House of Representatives
8 March 1978

31st Parliament · 1st Session

Mr SPEAKER (Rt Hon. Sir Billy Snedden) took the chair at 2. 1 5 p.m., and read prayers.

page 499


The Clerk:

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

Mr Steve Biko

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 on 13 September 1977, Steve Biko, President of the Black Peoples Convention died, aged 30, while being held incommunicado for questioning in detention without trial in South Africa;

That this is the 20th death of a black political prisoner in similar circumstances in South Africa in the last 18 months; and the 44th death of a prisoner while in police custody in recent years;

That Steve Biko had been held in detention since 22 August; and had previously been held for 101 days without trial; and in addition, was under a S year house arrest and restriction order;

That Steve Biko is the acknowledged leader of the black people’s resistance to apartheid, racial exploitation and injustice in South Africa, and that in this context his death in the hands of the white police must be regarded with grave suspicion;

Your petitioners accordingly request the Australian Government to register the strongest protest to the South African Government at the circumstances of Biko’s death and decline to accept the credentials of the new South African ambassador due to be appointed shortly.

And your petitioners as in duty bound will ever pray.

Petition received. by Mr Dawkins Petition received.

Schools Commission

To the Honourable the Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned parents of children attending Parkside Primary School:

Notes the recent Federal Governments instructions to the Schools Commission which includes:

  1. the provision of funds to private schools on a rate per pupil basis instead of a needs basis
  2. the automatic linkage of private school grants to 20 per cent of the average per pupil costs in government schools
  3. the cutting of $4m from the special school projects area to cover part of the costs of the increased funds going to private schools

And further notes the Federal Governments departure from the 2 per cent real growth increase in school funding for the current financial year

We your humble petitioners therefore pray that your Honourable House will:

  1. deplore the unwarranted intrusion on the independence of the Schools Commission involved in the Federal Government directing the Commission to cut funds in specified areas and apply these funds elsewhere
  2. reject the departure from the needs basis in funding private schools
  3. call on the Federal Government to require the Schools Commission to report upon the needs of Australian schools and make recommendations on the allocation of funds on a needs basis within any given budgetary allocation
  4. call on the Federal Government to implement the 2 per cent growth in real terms of Federal funding for Australian schools which was stated to be a minimum figure for planning guidance only
  5. reject the transfer of some $13-S 14m from government schools to private schools at a time when expenditure on schools has been frozen in real terms.

And your petitioners as in duty bound will ever pray,

Petition received. Pensioners: Home Maintenance Loans by Mr Jacobi. Petition received. Pensioners: Home Maintenance Loans

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

That it is necessary for the Commonwealth Government to renew for a further term of at least 3 years the States Grants (Dwellings for Pensioners) Act 1974-77, renewed for one year expiring on the 30 June 1978.

The demand for dwellings has not slackened as the waiting list (all States) of 12,060 single and 4, 120 couples as at the 30 June 1977, showeth.

Your petitioners respectfully draw the attention of the Commonwealth Government to the Report of the Committee of Inquiry into Aged Persons’ Housing 1975 under the Chairmanship of the Rev. K.. Seaman (now Governor of South Australia) which recommended additional funds to State housing authorities to meet the demand for low-rental accommodation in the proportion of $4 for $ 1 with the proviso that the States do not reduce their existing expenditure and

That the Act include married pensioners eligible for supplementary assistance and migrants as specified by the Seaman Report and that particular consideration be paid to the special needs and requirements of the prospective tenants in the location and design of such dwellings.

Furthermore, your petitioners desire to draw the Government’s attention to the hardship of many pensioner home owners caused by the high cost of maintenance.

The Social Security Annual Report 1976-77 shows that 24.6 per cent, or 283,000 home owning pensioners, have a weekly income in excess of the pension of less than $6 per week.

Your petitioners strongly urge the Commonwealth Government to establish a fund whereby loans can be made to means tested pensioners for the purpose of effecting necessary maintenance to their homes. Such a loan to be at minimal interest rates sufficient to cover administrative costs and to be repaid by the estate upon the death of a single pensioner before probate or upon the death of the surviving spouse in the case of married pensioners or where two pensioners jointly own the dwelling. Administration to be carried out by local government bodies.

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

Petition received.

page 500



page 500




– I ask a question of the Minister for Industry and Commerce. The Minister will have noted that in the Prime Minister’s statement to this House yesterday in which he sought to explain his personal intervention in the IBM affair there is a reference to the Minister as former Treasurer on page 9 of that statement. I ask the Minister In view of the fact that he resigned as Treasurer a fortnight before Mr Moyes of IBM Australia Ltd wrote to the Prime Minister on 2 December, will he tell the House when it was that Mr Moyes made representations to him on behalf of IBM? What was the nature of those representations? How did the Minister deal with them? Did he inform the Prime Minister or any other Minister of Mr Moyes ‘s approach? If so, when? Will he table any written communication to or from Mr Moyes on this matter? Will he table any written communication between the Prime Minister and himself on this matter?

Minister for Industry and Commerce · FLINDERS, VICTORIA · LP

– I shall check the record and if I feel that there is anything that needs to be added to the statement to this House made by the Prime Minister yesterday I shall advise the honourable gentleman in writing.

page 500




-Has the Minister for Defence seen recent reports that the radar at Amberley Air Force base is virtually useless because of a spare parts shortage and could be out of operation for over 12 months? If this is true, can the Minister inform me of the effect on the operations of the Air Force base at Amberley and when he expects the radar to be operational?

Minister for Defence · MORETON, QUEENSLAND · LP

– Yes, I have seen the reports. If I may say, with due respect, they seem to me to be highly fanciful. The Royal Australian Air Force at Amberley has been using the Eagle Farm air traffic control radar for many years. Indeed, it used that radar until about August 1977. Because a new type of radar, namely SURAD, was installed and there was a shortage of spares, Amberley temporarily dispensed with the use of SURAD radar and went back to using the old system. To put the matter into some perspective I say to my honourable friend that in a real sense the introduction or installation of SURAD radar at Amberley RAAF base is extremely welcome but could be looked at as something that in terms of priority could be done without. I suppose one could give all sorts of illustrations of that proposition. But that is the essence of the matter. For the next few months the RAAF Amberley base will revert to using the Eagle Farm air traffic control radar system, a system which the Amberley base has used for many, many years. The honourable gentlemen will be aware that the distance in a straight line between the Amberley base and Eagle Farm is of the order of 16 or 18 miles, which is quite within the capability of the Eagle Farm air traffic control radar.

page 500




-I ask the Prime Minister a question relating to the matter of a computer contract involving IBM Australia Ltd and Facom Australia Ltd. I repeat my question of yesterday. What were the four matters of viability raised by Mr Moyes to which the Prime Minister referred in his letter of 17 January? Were these the same matters then raised by letter dated 18 January from the Department of Administrative Services to each of the tenderers? If so, does this mean that IBM was answering questions asked by itself and that Facom was being obliged to answer questions asked by IBM? Accordingly, in order to elicit the true position, will the Prime Minister table the letter dated 2 December from Mr Moyes and his reply dated 17 January?

Prime Minister · WANNON, VICTORIA · LP

-Yesterday the Leader of the House indicated that the tabling of documents in this matter is obviously going to be something that impinges on commercial matters, matters that are still in train because tenders have been recalled, and clearly there is a great deal of information that could be regarded as competitive and confidential in a commercial sense. The honourable gentleman sounds, as he always does, eminently reasonable in asking in a limited way for one or two documents but then he asks for one or two more. The Government, I believe, must apply a rule in this matter and in matters of this kind, and that is that there should not be a tabling of documents if there is a relationship to commercial matters. Firms need to know that they can deal with governments in confidence. They need to know that information that comes either directly or indirectly in the course of the tendering process should be safeguarded.

There is some important information which I need to give the House. It is additional to that which is contained in my statement. It concerns government and IBM. It relates to a Minister of the Crown, and it is important. May I say that it relates to a former Minister of the Crown, now the Leader of the Opposition. On 25 May 1973 my colleague the honourable member for Corangamite, asked the then Minister for Social Security, the present Leader of the Opposition, this question:

Are senior members of his Department now in Canada or on their way there? If they are, when were the arrangements made for the officers of his Department to visit Canada? Finally, are his officers accompanied by a representative of the IBM company and, if so, who is paying the latter ‘s expenses?

The answer was:

I am not aware that a representative of IBM is accompanying the representatives of my Department in Canada. I will find out what the arrangement is. It certainly is not an official one and is one that I have not approved in any way because -

Mr Hayden:

– Um, um!


– I think the honourable gentleman should wait for the next part of the answer which he gave, which reads: . . . and is one that I have not approved in any way because it has not been brought to my attention. The representatives are in Canada largely to assess computer processing techniques which have been developed there. It is true that I have said that our scheme is not the Canadian scheme. It is not the British scheme nor is it any other country’s scheme. It is a scheme developed especially for the needs of Australia.

An uncharitable person could have drawn the conclusion- I do not draw this conclusion- that the honourable gentleman, in the light of subsequent events, was devising a scheme for the advantage of IBM. On 25 May 1973 Mr Hayden, in a ministerial statement, said:

The honourable member for Corangamite (Mr Street) inquired at Question Time this morning inter alia whether a representative of IBM was accompanying officers of the Department of Social Security presently in Canada. At that time I -

That is, Mr Hayden- had no knowledge of the matter but undertook to check his claim.

It should be remembered that he had said that it was not official and not approved. He went on to say:

Perhaps I could commence by pointing out that the Department of Social Security currently is engaged in an intensive investigation and planning exercise to determine the computer equipment which will be required for its future operations. In particular these investigations are centred on the equipment which will be needed to help in the administration of the new Health Insurance Scheme. As part of these investigations three officers of the Department are in Canada. Two of these officers are making a particular study of the type of computer equipment being used in health insurance administration in Canada.

The IBM company has supplied most of the equipment which is being used extensively in health insurance administration in Canada and the officers concerned have been inspecting such installations. I should point out that most of the equipment used by the Department of Social Security is IBM equipment. It is true that a representative of the IBM company has been with these officers in Canada. The IBM representative who has been with them is a computing systems engineer and he joined them on 1 May 1973. I have asked the Acting Director-General of my Department to obtain full details of how this arrangement was made and I will advise the honourable member for Corangamite, who raised this question, as soon as that information comes to hand.

There was no suggestion at that time that it was not official. Then the honourable member for Corangamite asked the Minister for Social Security the following question upon notice:

Will tenders be called for the supply of computer equipment required for the Government’s proposed National Health Insurance Scheme; if so, will details of tenders received be made public.

The question was answered on 29 August 1973. If my information is correct, tenders were called on 14 June 1 973, only a few weeks after an IBM official had accompanied the officers of the Minister for Social Security to Canada to examine computing arrangements. The then Minister for Social Security gave the following answer:

The computing equipment to be procured is made up of three major items.

I do not think that honourable gentlemen would be particularly interested in a detailed description of the items but the cost of item 1 was $5. 5m, which should be noted, the cost of item 2 was $4.3m and the cost of item 3 was $3.2m. The Minister for Social Security at that time went on to say:

Insofar as Item 1 is concerned, the Department intends to request the Commonwealth Stores, Supply and Tender Board to certify that it is inexpedient to call open tenders . . . The central processing unit of the second computer, Item 2, must be identical to the first as the two machines must work in such a way as to back each other up utilising common programs and software systems and the Department does not propose to invite open tenders for this unit.

Mr Hurford:

– That is fair enough.


– I am not saying that it is not fair.

Mr Keating:

– What are you talking about?


-For days the honourable gentleman concerned has been making claims and allegations. Then we come to the circumstances in which open tenders are called for item 3 and, of course, to finish the saga, IBM receives the contracts. Nobody really suggests that the honourable gentleman was involved in an impropriety- perhaps honourable members opposite would suggest that- but that was a circumstance in which an IBM engineer accompanied officers of the Department only days before tenders were to be let and let in such a way that the contract would be to IBM. Quite plainly there must be fair competition and fair play between companies. I do not believe that under those circumstances anyone can claim that fair play between companies had been preserved. Nevertheless, I think the House needed to know the relationship between the Leader of the Opposition and IBM.

page 502




– Is the Minister for Defence aware of reports that equipment at the Darwin radar centre operates for only 12 hours a day? Can the Minister advise the House of the situation and of any plans to remedy any deficiencies in the operation of that equipment?


– Those reports arose out of evidence given yesterday, I understand, before His Honour Mr Justice Williams, who is sitting in Darwin as a royal commissioner inquiring into drug activity. The evidence was along the lines that come 8 p.m. the call is ‘Shut her down, Ernie. We are going home’, and that the radar does not operate after that. That simply is not true. Radar operates at Darwin 24 hours a day, seven days a week. I hope my honourable friend will understand that, and I hope the Australian people who are concerned about surveillance activities will understand that also. What happens simply is this: Between the hours of 8 p.m. and 6 a.m., when there is very little traffic in the area, the man who is responsible for the tower control takes over the responsibility of viewing the radar display. That is the simple situation. I hasten to correct any vision that the man there is being driven into a state of exhaustion by his duties. The simple fact is that between the hours of 8 p.m. and 6 a.m. one man is watching both the control and approach displays on the one radar screen.

page 502




– I ask the Treasurer a question. I refer him to the Prime Minister’s statement to this House yesterday in which he referred to the present Treasurer at page 13 of that statement. I ask the Treasurer why he was so eager ‘to press that the Government proceed with the Facom tender’. Was the Treasurer satisfied that no impropriety had occurred in the process of recommending the contract to Facom Australia Ltd? Will the Treasurer table his letter to the Prime Minister referred to in that document? Further, has the Treasurer had any oral or written communication with representatives of IBM Australia Ltd on this matter?


-I did write to the Prime Minister putting a particular point of view substantially to the effect referred to in the statement by the Prime Minister yesterday. The Prime Minister has canvassed already in some detail the attitude of the Government regarding the proprieties of this matter and the need to have an observance of certain procedures. So far as communication with IBM Australia Ltd is concerned, to the best of my recollection- without checking my files- I have had no communication with IBM regarding this matter save and except that a copy of Mr Moyes’s letter of, I think, 2 December, to the Prime Minister was either sent to me directly by Mr Moyes as a courtesy or, alternatively, forwarded to me by the Department of the Prime Minister and Cabinet because of my interest in this matter as I had ministerial responsibility at that time for the Australian Bureau of Statistics.

page 502




– I address a question to the Treasurer. He will recall the commitment in the Liberal Party’s policy speech last November to introduce a scheme of deposits insurance for building societies. Will the Treasurer inform the House of the state of play with respect to the introduction of such a scheme?


– The commitment made in the policy speech was that the Commonwealth Government would explore with the States the establishment of a scheme whereby deposits with building societies could be insured in some manner. That commitment was reiterated in the Speech of His Excellency the Governor-General at the opening of Parliament. I can inform the House that the Government has established already an interdepartmental committee comprising representatives of my Department, the Department of the Prime Minister and Cabinet and the Reserve Bank of Australia for the purpose of investigating and recommending the most appropriate method by which such a scheme might be introduced. This Committee has met already. Last week the Prime Minister, my colleague the Minister for Environment, Housing and Community Development and I met representatives of permanent building societies throughout Australia and received their general views on this matter. I can tell the House that the Government believes that the most desirable way in which such a scheme might be established is one that is established in full co-operation with State governments- a scheme which has national application.

For this reason, we attach particular significance to co-operation with State governments. The Prime Minister has written already to the State Premiers advising them of the establishment of the Commonwealth interdepartmental committee and inviting responses from State Premiers as to joint exploration of the best way of devising a scheme. Thus far the Government has received responses from two of the States and is hopeful that the other States will respond as soon as possible because the essence of a satisfactory outcome to this exercise, which the Government believes will be welcomed by the building society industry, is that which is the result of full and complete co-operation between the Commonwealth and the States.

page 503




-I ask the Minister for Transport whether he is aware of a statement released in Alice Springs by his colleague the Minister for Primary Industry during the recent election campaign in reference to the Stuart Highway, which read:

After discussing the issue with Mr Sam Calder, M P., and Senator Bernie Kilgariff I believe it is necessary to identify a special fund allocation specifically for the reconstruction of the Stuart Highway. This would mean, in addition to funds provided to the South Australian Government as part of the national program and for allocation at their direction, there would be a specific sum provided to upgrade the Stuart Highway over a period of years.

In view of the Minister’s reported attitude that it is not the policy of the Government to provide grants for specific road works outside the normal funding arrangements, do the views of the Minister for Primary Industry conflict with his own views on the funding of the Stuart Highway reconstruction? What is the real situation regarding the Stuart Highway?

Minister for Transport · GIPPSLAND, VICTORIA · LP

– The views of the Minister for Primary Industry, in common with my own, reflect a recognition of the necessity to upgrade the Stuart Highway. The discussions of the Minister for Primary Industry with the honourable member for the Northern Territory also reflected the concern of the people of the Northern Territory that the South Australian Government is doing nothing about the upgrading of the Stuart Highway. The fact is that this Government is making available $20m for national highway construction in South Australia this year. It suits the political purposes of the South Australian Government not to make funds available for the Stuart Highway because it does not think there are any votes for it in the Northern Territory. It is to the everlasting shame of the Labor Government of South Australia that that situation exists.

Mr Charles Jones:

– What are you doing about it?


– I fixed my priorities in this way. I wrote to the South Australian Minister for Transport informing him that I would appreciate knowing that funds would be made available by South Australia in the next financial year for an expenditure program on the Stuart Highway. The Minister has written to me concurring in this matter.

page 503




-Can the Minister for Health inform me of the percentages of successful appeals to the social security appeals tribunals in each of the States? In the event of a significant disparity, could the Minister explain the seeming anomaly?

Dr Klugman:

– You just happen to have the figures.

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

– I do happen to have the figures that the honourable member for Wide Bay is seeking. The Minister for Social Security keeps me very well informed in case I receive a question such as this. From 1 July 1977 to 3 1 January 1978, that is, seven months, the following appeals were upheld or partly upheld on the recommendation of the tribunals. The figures, on a percentage basis, are: New South Wales, 20 per cent; Victoria, 9.6 per cent; Queensland, 9.6 per cent; South Australia, 26 per cent; Western Australia, 10.1 percent; Tasmania, 10.5 percent; Northern Territory, 20 per cent; and the Australian Capital Territory, 6.9 per cent. The average for Australia was 12.4 percent. Since the tribunals are autonomous in the sense that they operate as independent units it is, of course, inevitable that the different views and attitudes of the members will be reflected in the statistics. However, the discrepancies are being monitored and are discussed from time to time with the tribunals. I am informed by the Minister for Social Security that the practice of monitoring the decisions of the tribunals will continue, as far as resources are available, in order to ascertain any reasons for quite large discrepancies between the States. It is a very good question and I can assure the honourable member that the Minister for Social Security is watching the situation carefully.

page 503




– From recollection, the question of a natural disaster insurance scheme was before a meeting of Premiers at a Premiers Conference sometime last year. As a consequence of consideration at that meeting, a working party comprising, I think, both Commonwealth and State officials, was established to explore the way in which such a scheme, involving both the Commonwealth and the States and, as the honourable gentleman has suggested, the insurance industry, could effectively be brought into existence. I shall obtain for the honourable gentleman an up-to-date report on the state of that consideration and let him know the results.

page 504




-I direct a question to the Prime Minister. He is no doubt aware that last night the Prices Justification Tribunal announced an increase in the price of petrol. I refer to the variation in the selling price of petrol throughout Australia. I cite the classic example of Hobart where the maximum wholesale price of petrol is 16.97c a litre super grade, making an average selling price of approximately 22c a litre super grade. I also refer to the fact that super grade petrol may be purchased on most street corners in Melbourne, Adelaide and Sydney at approximately 15.8c a litre, which is nearly 30c a gallon more than the price charged in Hobart. The Prime Minister will understand the effect this has on the economy of Tasmania. Therefore, will he give the House an assurance that in view of the unfair variation the Government will look seriously, firstly, at the wholesale prices being charged by the oil companies in Australia and, secondly, at the decision of the Prices Justification Tribunal in relation to this latest price increase?


-The question of petrol pricing is a very serious one indeed. The honourable gentleman has been vigorous and energetic in trying to achieve a fairer petrol price system than that which now operates. The honourable gentleman will know, as will all honourable members, of the fuel price equalisation proposals which were part of our last general election program. They will be put into operation as soon as legislation can be introduced, passed through the House and implemented effectively. As I understand it, the matter to which the honourable member for Franklin was addressing himself really goes to the heart of the pricing policies of the petrol companies themselves. We all know of the practice of some retailers who make no attempt to supply the higher cost areas but who significantly supply Melbourne and Sydney and do not get out into the country where there are transport costs in relation to distribution. As a result, they are able to give very significant discounts. This has created difficulty for other retailers in terms of a fair deal and in terms of many of them being able to survive on an equitable and fair basis. So there is a question of fairness in terms of the pricing of petrol around Australia and also in relation to a large part of the retail industry.

A number of small retailers have been put in very great difficulty as a result of the operations on the one hand of petrol companies and their wholesale pricing policies, and on the other hand because of the operations of some retailers like ACTU-Solo Enterprises Pty Ltd who make no attempt to service the whole of Australia and take cost advantage, therefore, by serving the high density areas. The Government has been looking at this latter problem. At meetings held under the chairmanship of the Minister for Business and Consumer Affairs the industry has been in discussion with the Government. I think it is generally recognised that this is a real problem. It is the Government’s intention that it be overcome. We would like it to be overcome on a co-operative basis and by agreement because we think that would be the fair and reasonable way in which to proceed. From what I have heard of the discussions, the Minister might be having some difficulty in getting to that overall agreement. However, I believe it is an important objective. I thank the honourable gentleman for his continued interest in the cause of better petrol prices and a fair deal for Tasmania.

page 504




– My question is directed to the Minister for Productivity. Have the Government Aircraft Factories presented a submission to the Government for the provision of Nomad Searchmaster aircraft for surveillance work? What stage of development has it reached? What is the date on which delivery of these aircraft is anticipated to take place? Is the projected price of these aircraft competitive with that of similar aircraft and less than the $45 million-odd quoted for another aircraft last week by the Minister for Defence?

Minister for Productivity · BALACLAVA, VICTORIA · LP

-Work is still proceeding with the adaptation of the Nomad aircraft for surveillance purposes under the title Searchmaster. Work is still proceeding, in a technical sense, but submissions have been made to an interdepartmental committee which is looking at the whole question of coastal surveillance. When the time is right an announcement will be made about the appropriateness of the Nomad for that purpose.

page 505




– Is the Minister for Trade and Resources aware of a statement made by Sir Frederick Catherwood the Chairman of the British Overseas Board of Trade, that Australia is one of the very few advanced countries which rely on protection to defend their industries and that that has weakened Australia’s international trading position? Does Sir Frederick Catherwood ‘s statement accurately reflect the relative degrees of protection in Australia and the European Economic Community?

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

– I have seen reports of some comments made by Sir Frederick Catherwood and I do not take to them kindly. Australia sees evidence of protectionism in many other countries and has committed itself to joining with other countries in trying to achieve a balanced reduction in tariff barriers- not just straight out tariffs but also other non-tariff devices. We want to see tariff barriers reduced in relation to agricultural products as well as industrial products. Sir Frederick seems to assume that the policies of protectionism accorded to agricultural industries in Europe should not be questioned. At the same time the modest levels of protection that we give to our secondary industries in Australia are to him unreasonable and unfair. To me that is an indication of the double standards of thinking that exist in the minds of many people in Europe. It seems that agricultural industries in Europe are sacrosanct and that any amount of protection can be provided to them. It is almost immoral to question such a policy. Apparently the European countries have a right to do whatever they wish in terms of economic security but we, as a developing industrial nation, have no right to give degrees of protection if we have problems.

I believe that Sir Frederick will be coming to see me this afternoon. I do not know whether this matter will be a topic for discussion but I am sure that I will find it an occasion on which to make some comments to him which he might like to put in the Press. If Australian exporters found it as easy to get into the European markets as the European exporters find it is to get into the Australian market, our exporters would be in a very favourable position.

page 505




-My question is directed to the Prime Minister. It refers to the reopening of the United Nations Educational Scientific and Cultural Organisation embassy and the consulates at Los Angeles and Bombay to which the Prime Minister referred last Thursday in his statement on the resignation of Sir John Kerr. Will the Prime Minister give full details of the arguments used in favour of reopening these posts? Is he aware that the House of Representatives Standing Committee on Expenditure only last May, after a thorough examination of Australia ‘s overseas representation, received no submissions advocating any reopenings and, in fact, recommended additional closures? Has he noted the report to the effect that it will cost the Australian taxpayers an additional $440,000 for just the consulate reopenings, leaving aside other costs relating to UNESCO? Finally, will he not only table relevant documents which he has received to date but also arrange for a full statement of the costs of the closures and the reopenings to be presented to this House?


-The decision to reopen the Los Angeles, Bombay and United Nations Educational Scientific and Cultural Organisation posts was taken as a result of a letter that the Minister for Foreign Affairs wrote to me recommending in strong terms the reopening of those three posts. The Minister is out of the country for a few days. I am quite sure that he would be very happy to answer in full the question that the honourable member for Adelaide raised. The Foreign Minister believed that, on important national grounds, all three posts ought to be reopened. He was able to persuade the Government to that effect.

page 505




– My question, which is directed to the Minister for Health, refers to the controversial Mr Milan Brych. Has the Minister given any further consideration to any action which the Federal Government might or will take so that a clinical evaluation of the expensive treatment provided by Mr Milan Brych in the Cook Islands for cancer sufferers can be undertaken?

Mr Lusher:

– What are you the member for?


-We would not let him into the Cook electorate, let me tell you that. Can the

Minister advise the House whether he has any knowledge of the range of fees charged by this man to those seeking his controversial treatment?


– The Government is prepared to offer Milan Brych an opportunity to produce evidence about his treatment of cancer, and by ‘evidence’ I mean scientific evidence which can be evaluated by scientific experts. The Government is anxious to ensure that if a more effective method of treating cancer really exists it is made freely available to all Australians. Therefore, on behalf of the Government, I want to make the situation with regard to Mr Brych absolutely clear. Leaving aside the question of whether he is a medically qualified practitioner or whether the serious charges which led to his deregistration in New Zealand were justified, let us examine the claims he has made concerning the effectiveness of his co-called new secret treatment method which he has been rendering since 1 972.

Mr Brych has had six years in which to produce reports and papers. This is a normal procedure for people in the scientific area of the profession. He has consistently refused to follow this practice. His results have been published only by way of headlines in newspapers. He has restricted his treatment to those people who can afford to pay the very high- indeed, exorbitantcharges involved.

Mr Jull:

-How much?


-Up to $20,000 or more per patient. In spite of all the doubts, the Government is prepared to do all in its power to obtain details of Mr Brych ‘s methods in case they may be of benefit to cancer sufferers. The Government makes this offer to Mr Brych: If he will give his personal assurance to co-operate fully and to reveal every detail of his treatment- methods and case records- I will ask the Government to send an expert team to the Cook Islands to discuss the whole matter with him. Members of the team would be scientists of the highest calibre whose reputations and capacities in this field would be beyond any doubt. I am also prepared to include a distinguished layman. There must first be agreement on Mr Brych ‘s pan, otherwise the exercise would be pointless and futile. Nothing could be fairer than this. The ball is now in Mr Brych ‘s court. The onus of proof is now on him to respond to this offer to establish once and for all the effectiveness of his very expensive treatment.

page 506




– I direct a question to the Prime Minister and refer him to his statement to the House yesterday in which he said that he held deep seated doubts and reservations about the tendering processes for the Australian Bureau of Statistics computer ‘a considerable time’ before Mr Moyes of IBM Australia Ltd wrote to him on 2 December. Why then did the Prime Minister tell Mr Moyes in his letter of 17 January that, because of matters raised by Mr Moyes ‘s 2 December letter and because of Mr Moyes ‘s discussions with the Prime Minister and the chairman of the Public Service Board, tenderers for the computer contract, including IBM, would be given the opportunity to ‘clarify’ their tenders? Did the Prime Minister say in his letter to Mr Moyes: ‘Of course, if you wish to vary your existing tender on the basis of these clarifications, the Government will be prepared to consider your proposition?’ Will the Prime Minister table his letter of 1 7 January to Mr Moyes?


– I have made it perfectly plain that any matters relating to specifications arose from discussions between officials and as a response to the way officials dealt with particular aspects of matters that might have been put to me or to anyone else. This question gets back to the original proposition. We had a situation in which Mr Harragan had resigned at a very strange time indeed, having regard to the tender process. That being so, it was a question of justice being seen to be done as well as being done. We had that as a paramount objective. In addition, officialsespecially those from the Australian Bureau of Statistics- were pressing the Government for an early decision so that new equipment could be obtained at the earliest time. For a considerable time we were seeking to try to meet both of those objectives until ultimately it became perfectly plain that it was not possible to meet both those objectives and that there was only one proper thing to do. That was to recall tenders completely.

Everything that happened up to the point of the recalling of tenders needs to be looked at against that background. That was the only reason why the shortened tender process was first devised, that is, to try to get things done quickly but in a way that would test the viability of the original tenders and in a way that would be fair. The further that process continued, the more officials came to the view that it was not a proper course to take. Therefore, they recommended the entire reopening of tenders and that is what was done. To keep this matter in perspective, I think it is worth noting again that the Leader of the Opposition in the speech that he made in the Parliament has confirmed what we have done. He said that he believed Mr Harragan ‘s behaviour was quite improper. After saying that, does he now suggest that nothing should have happened and that the Government should not have acted? The Leader of the Opposition indicated that he regarded Mr Harragan’s behaviour as quite improper. If we had allowed the matter to proceed it is perfectly plain, on the basis of what the Leader of the Opposition has said, that he would have been attacking us from the other side of the fence. The Leader of the Opposition even went on to say in a later statement on Mr Harragan that in his view he was deserving of censure. I think in relation to these mattersparticularly having regard to the computers for Medibank when open tenders were not called and the orders were placed with IBM- that it is time the honourable gentleman got off this particular horse.

page 507




-Is the Minister for Primary Industry aware of allegations made in another place last evening of malpractice in the Australian meat export industry? Can he inform the House whether there is any substance to these allegations?

Mr SINCLAIR I have read a statement made in the other chamber by Senator Primmer in which he makes very serious allegations about a number of purported malpractices in Australia’s export industries. Not unnaturally, these are of concern not just in the administration of my Department but also in maintaining Australia’s very high reputation abroad, in terms of both the quality of our product and the standard of inspection that is effected, in order to ensure that the product meets the general description that is given to it and, of course, meets the standards that we necessarily impose on all our exports. The honourable senator made a number of specific allegations, in particular one regarding investigations made by the Commonwealth Police. These flowed from some allegations made in a wild way last year without specifics being mentioned. We managed to obtain some details. As a result, about the middle of last year- on 2 1 June, to be precise- my Department requested the Commonwealth Police to commence an investigation. As a result of that investigation Acting Chief Superintendent R. H. Gillespie, the Officer in Charge of the District of Victoria, wrote to the Regional Director of my

Department in Victoria. Mr Speaker, I seek leave of the House to have a copy of that letter incorporated in Hansard.

Leave granted.

The letter read as follows-

page 507


102-104 Jolimont Road, East Melbourne, 3002 Postal Address: Box 48SG, G.P.O., Melbourne, 300 1 Telegraph: 6542744 Telex: AA31796 Telegraph: “COMPOL”

Our ref: V77/2180 16 November, 1977.

Regional Director, Department of Primary Industry, 10 Queen Street, MELBOURNE. 3000

Exportation of Meat not obtained from Registered premises

At the request of Doctor R. H. WHITING, who was previously employed by your Department, this Force has been conducting an investigation into allegations that meat which has not been obtained from Registered Premises is being exported.


A/Chief Superintendent Officer in Charge DISTRICT OF VICTORIA

Minister for Primary Industry · NEW ENGLAND, NEW SOUTH WALES · NCP/NP

– Only one report was made to my Department. It stated that 10 companies had emerged as suspects in relation to breaching the Exports (Meat) Regulations. The companies were not named. However, the report from the Commonwealth Police specified that inquiries made and surveillance of suspect vehicles had failed to provide sufficient evidence for prosecution and that inquiries were continuing. No further report has been made to my Department by the Commonwealth Police. It would seem that there is no basis now for Senator Primmer ‘s allegations. However, if he has any facts that he wishes to disclose in confidence to either the Commonwealth Police or the Department, of course they would be prepared to follow those allegations further.

A number of other detailed assertions were made in the honourable senator’s statement in the other place. With one exception, I do not propose to answer them here. That exception is a purported complaint from an East European country at a diplomatic level about exports from Australia. As far as the Government is aware, no official complaint has been so lodged. There was a commercial dispute between Polish and Romanian import agencies and an Australian supplier late last year regarding the fat content of meat, which importers claimed was in excess of specifications. The Australian Meat Board was used to adjudicate in the matter, a settlement was made in an ordinary commercial way and there has been no complaint from either country as to the basis of the resolution of that dispute. Some other quite wild assertions were made by Senator Primmer. I believe that it is necessary for the highest possible export standards to be maintained both by the technical officers of the Department of Primary Industry and by the Government. To the best of my knowledge these have been met. If Senator Primmer has any other evidence- indeed, if he has any evidence- to justify his complaints, I suggest that he submit it to either my Department or the Commonwealth Police. That might be a more equitable way of settling wild assertions in a fair and just manner.

page 508


Leader of the Opposition · Oxley

Mr Speaker, I seek leave to table a document. It is a copy of a letter from the Prime Minister of Australia dated 1 7 January 1 978. It is addressed to Mr A. G. Moyes Managing Director, IBM Australia Ltd, IBM Centre, Sydney, NSW 2000.


-Is leave granted?

Mr Malcolm Fraser:

– It has been published. There is no reason why it should be tabled.


-Leave is granted. The document will be tabled.

Mr Malcolm Fraser:

– No, leave is not granted, Mr Speaker. I said: ‘It has been published. There is no reason why it should be tabled’.


– I apologise. I misinterpreted the Prime Minister’s words. Leave is refused. The document will not be tabled.

page 508


Leader of the Opposition · Oxley

Mr Speaker, I claim to have been misrepresented.


-Does the honourable gentleman wish to make a personal explanation?


– Yes.


– He may proceed.


-During Question Time the Prime Minister (Mr Malcolm Fraser), in answering a question, referred to certain arrangements associated with the purchase of a computer by the Department of Social Security in 1973. He quoted extensively from a statement I made in the Parliament on 25 May 1973 about a representative of IBM Australia Ltd accompanying officers of the Department of Social Security. I make the point clear that my recollection is quite sound on this. I had no knowledge that this arrangement had been made. From recollection, it was an unofficial one, and immediately I discovered the facts of the matter I instructed that it should be terminated. However, the association had terminated of its own accord before the instruction was issued. It is a shame the Prime Minister did not complete his quote from what I had said because it finished this way -

Mr Cotter:

– You are on the run.


– I do not think so. I think the Prime Minister may have that problem shortly. The Prime Minister neglected to mention at the end of the quotation that I added:

I might add that I understand there is some sort of precedent for this sort of practice. For example, in the mid- 1 960s, a representative -

We were not in government then, honourable members will recall, although the coalition parties were- of another computer supplier accompanied a representative or representatives of the then Department of Social Services on a visit to the United States of America when the visit was for the purpose of inspecting computer installations.

It was on that basis, I understood, that the Department presumed there was sufficient precedent to justify what it did. It knew better when I issued my instruction. I hope my instruction still stands.

Mr Malcolm Fraser:

- Mr Speaker, it ought to be noted that in spite of the instruction the contract was awarded to IBM Australia Ltd without going to open tender and that the honourable gentleman could certainly have seen that that would occur.


-Order! The right honourable gentleman will resume his seat.

Mr Hurford:

- Mr Speaker, I rise on a point of order. Under which Standing Order did the Prime Minister rise and make this statement.


– I am about to ascertain that. Does the Prime Minister wish to be called?

Prime Minister · Wannon · LP

- Mr Speaker, I wish to speak on a personal misrepresentation.


– Does the honourable gentleman claim to have been misrepresented?


-Yes, Mr Speaker.


– If the right honourable gentleman wishes to make a personal explanation he may proceed.


-Mr Speaker, the implication in what the Leader of the Opposition (Mr Hayden) has said is that the matters had proceeded without his knowledge. It is perfectly plain that when it was decided that the contract should be awarded to IBM without going to open tender the Minister would have had to be involved in that.

Mr HAYDEN (Oxley-Leader of the Opposition)- Mr Speaker, I wish to make a personal explanation.


-Does the honourable gentleman claim to have been misrepresented?


-Yes. The facts are that the procedures adopted on that occasion had long established precedent- precedent established by previous conservative governments. The situation is not analogous. The fact is that the Prime Minister (Mr Malcolm Fraser) intervened directly and in a way which leaves the appearance of giving favour to IBM Australia Ltd. That is what this question is about. I did not intervene at any stage. That is a very important distinction.


-Order! The honourable gentleman will resume his seat. I have permitted considerable laxity in personal explanations. It is not the occasion for a continuation of the debate.

page 509


Discussion of Matter of Public Importance


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

The depressed state of the home building industry due to the inadequacy of financial support for the industry.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the Standing Orders having risen in their placesMr UREN (Reid) (3.9)- It is in the housing industry where the conservative Government’s economic policies are felt most. The industry is under-utilised. There are ample resources, both men and materials, to build shelter for people who are not able to acquire finance to build a home because of the Government’s tight money policy, or for people who are not in income brackets which would enable them to meet the required monthly repayments. More and more people are being forced to register with the State housing commissions or to continue to live in sub-standard conditions where social problems are expanded. The home building industry is at least one sector of the Australian economy where there is a potential for growth, and that growth could have a multiplying effect on other industries if the Australian Government acted in the interests of the community as a whole. But this Government is not concerned about the community as a whole. This Government is a sectional government. It is a class biased government. It is part of the Government’s policy to maintain a tight monetary situation. It has a beat inflation first mentality, irrespective of the unemployment and the social and human suffering it is creating. Above all it does not even make sound economic sense.

Let us examine some of the facts of the home building industry. Firstly, real private investment in dwellings for the September quarter of 1977 was 13 per cent below [he level for the same period a year earlier. Total dwelling approvals for the December quarter of 1977 were almost 15 per cent below the level for the same period one year earlier. Building commencements were down by almost 20 per cent on the previous December quarter, which was the lowest quarterly level for three years. The number of houses under construction recorded for the December quarter was the lowest for the last six years. Total loan approvals for owner occupations in November were only 2.2 per cent above the level for the same period a year earlier. Loan approvals have been constrained by the growth of the money supply, which is running at less than 5 per cent- well below the Budget proposal of some 8 per cent to 1 0 per cent.

The last Indicative Planning Council report for the housing industry estimates the feasible capacity on available manpower and material at 150,000 dwellings in 1977-78. Based on the latest building statistics, the dwelling construction industry is producing fewer than 130,000 dwellings at an annual rate. This means that the industry is running at no more than 85 per cent of capacity. The rundown in industry capacity will cause future problems not only for the industry but also in the standard of housing that Australians regard as a basic right. The industry needs a stimulus now. A warning has been given by the Department of Employment and Industrial Relations. It is set out in a study entitled ‘Employment Prospects by Industry and Occupation’. I must say that this study was reported upon only in February of this year. This study, in part, says:

In the longer term assuming a full recovery occurs in the building industry the possibility of the re-emergence of skilled labour shortages cannot be ruled out. It is thought that many tradesmen may have permanently left the industry during the downturn and would be unlikely to return to their former occupations. The fall-off in the rate of new apprenticeships registered in the building trades will also contribute to skilled labour shortages in the event of the industry returning to full capacity.

That is a warning that the industry must be stimulated now to prevent inflationary bottlenecks from occurring in the future. With the industry running at such a low level of capacity utilisation, a very sound case can be made for stimulating the industry through the provision of additional finance. The industry should get this finance not only on economic grounds but also on social and human grounds. A stimulus at this time would not be inflationary and the manpower and materials are available. One has only to examine the Australian Bureau of Statistics’ labour force survey of November 1977, which shows that employment in the total building and construction industry have been above that in all other occupations over the last three or four years. Not only is the industry capacity available but also the demand is there.

We can expect to see household formation continue at the rate established in the 1960s and 1970s at least until the mid 1980s. The number of people on the waiting lists of State housing commission exceeds 100,000. When one realises that last year only 11,400 dwellings were constructed by the State housing commissions one can understand the tragedies in our community due in a great part to inadequate shelter. Houses must be built to eliminate this human suffering, which cannot be tolerated in a country such as ours. In order to understand the real public sector attitude one should examine the table which I have obtained from the Parliamentary Library which clearly sets out the position. According to the table, in 1954-55 at least 22 per cent of all housing- one in five houses- was built by the public sector. In 1 977, 7.9 per cent of housing- or one in twelve houses- was built by the public sector. In 1 976, because of the flow-on of enormous amounts of money allocated to welfare housing by the Whitlam Labor Government, 12.2 per cent of housing was built by the public sector.

Let us look at the amounts that have been allocated in various Budgets. In 1974-75 the Labor Government allocated 2.1 per cent of the

Budget for public sector housing. In 1977-78 only 1.46 per cent of the Budget was allocated for welfare housing. That shows this Government’s priorities. We need to upgrade the provision of welfare housing. No wonder the number of people on the waiting lists of housing commissions exceeds 100,000. More houses must be built in the welfare section, and there should be an immediate increase in the allocation of funds to the State housing authorities.

At present 70 per cent of housing funds goes straight to the public sector and 30 per cent goes to the terminating building societies. At this stage I believe that we should be allocating more money to the terminating building societies. In that way we can stimulate the economy more quickly. That is a short term policy. The long term policy should be to put more money into the public sector, because the welfare housing sector needs money more urgently.

The Government should direct the Reserve Bank of Australia to ease the restrictions on the availability of finance for housing. Special measures will be needed to prevent the industry from slipping further behind because of the possibility of a drain on finance due to the seasonal rundown in liquidity to meet $5 billion in tax payments. The token attempts at interest rate cuts will not provide the needed stimulus unless measures are taken to provide for an adequate flow of funds to the housing sector. The drop in interest rates will still mean that purchasing a home will be well out of reach for most Australian families that are seeking homes. For example, a single income family on average weekly earnings- which are about $205- with repayments set at 25 per cent of income, could borrow about $2 1 ,000 at the permanent building society interest rate of 12 per cent, to be repaid over 25 years. A half per cent drop in interest rates would enable this family to borrow about $21,700, an increase of $700. That is well short of the loan required to buy a modest dwelling, say, in the western suburbs of Sydney, which would cost at least $30,000. A loan of $2 1,700 to purchase a home costing $31,000 leaves a considerable deposit gap.

Despite the slight lowering of interest rates, the Government’s economic policies are making it harder for people to purchase their own homes. Not only is the availability of funds being constrained through unrealistically low targets for the growth in the money supply, but also people are being forced to obtain more of their housing finance from institutions where money is more expensive. I refer to the fringe banking institutions. So we see that the half per cent reduction in interest rates is just window dressing. In the June quarter of 1976 about 30.5 per cent of home loan approvals were from permanent building societies and finance companies. In the September quarter of 1977 this share had risen to 41 per cent. Most of this increase came from a decline in the savings and trading banks share from 58 per cent to 47 per cent during the same period.

Savings bank interest rates for housing loans are between 9 per cent and 10 per cent. The interest rate charged by permanent building societies is about 12 per cent. Higher interest rates reduce the capacity to borrow of those people wanting to buy their own homes. For example, with repayments set at 25 per cent of income, a home buyer on the average weekly earnings of $205 could borrow about $25,200 at the savings bank interest rate of 9.5 per cent. If a person were forced to go to the non-bank institutions and borrow at 12 per cent he could borrow only $2 1,000. This means that the policy of forcing prospective home buyers into high cost money will increase the already excessive deposit gap by more than $4,000. The Government must take the important step of ensuring an adequate flow of funds and reverse the persistent outflow of capital from Australia which has occurred in recent months. That would be a most important act for this Government. The Government has been unable to plug the outflow of foreign capital, which has lowered the availability of liquid money in this country. A capital outflow places a drain on domestic liquidity and in turn limits the funds for all investment activities, including housing.

Finally I warn the Government that if it is intent on heightening social tensions by squeezing the resources at the command of the people, this policy will manifest itself in the area of housing. A house is the biggest single investment or expenditure item in the lifetime of any family. It is an important item to that family. Housing is an important facet of Australian society. It is important that people have the right to have shelter. It is important that finance is made available to them on reasonable terms. So I ask the Government to act and to make finance available. There is a great downturn in the economy, and unless a stimulus is provided the housing sector of the economy will stagnate. Stimulation of this area of growth will have a multiplier effect. If the housing industry is built up the white goods industry, the furnishing industry and all the other industries that are related to the housing industry will receive a stimulus. I call on the Government to act now.

Minister for Environment, Housing and Community Development · Braddon · LP

– It is sad in a way to have to reflect that many of the pressures that the housing industry, along with other sectors of industry, has to bear are a direct heritage of the decisions made by honourable members opposite when they were in government. The housing industry is particularly influenced by monetary policy. Monetary policy has to bear the excessive brunt of adjustment when we face inflationary situations such as those created by the previous Australian Labor Party Government. The worst example of monetary instability was in the period 1973-1975. In this period the rate of growth in the money supply, broadly defined, fluctuated from an annual rate of more than 20 per cent in 1973 to less than 10 per cent in 1974, and back to 20 per cent growth in 1975. It was not surprising, therefore, that the housing industry has had a series of peaks and troughs in recent years. It enjoyed a healthy boom in 1973 - perhaps one should say it enjoyed a heady boom in 1 973- and followed the rest of the country to a sharp recession during 1 974 but recovered moderately in 1976-77.

Such instability- I think it is vital in this debate to note that there has been significant instability in this industry- is bad for home buyers, bad for builders, bad for workers within the industry, bad for sub-contractors, bad for the suppliers who supply the industry with materials and, indeed, bad for the economy. The damage done may take years to be corrected. Economic studies carried out by my Department show that whilst cost increases vary rapidly during times of overstretched resources it takes much longer to moderate these increases at times of slacker activity. The stance adopted by the present Government, of course, contrasts very much with the stance adopted by the previous Administration. When in government its approach was a completely ad hoc approach. Its policy towards the building and construction industry was never constant and never heading in the one direction. The Labor Government just did not have an overall economic policy to pursue. There was no clear guideline for it to follow in deciding whether those who were investing within the industry should outlay thousands of dollars or millions of dollars in new investment, or whether they should delay doing so or whether they should not invest any money at all.

This Government, in complete contrast, has held a steady course since coming to power. It has had an over-riding objective of reducing the heritage of inflation left behind by the previous

Administration. We have stated continually that the most important single way of getting this country back on the road to economic recovery is to break the back of inflation. It is only in this way that we can restore consumer and business confidence. It is only when the community knows that the inflationary spiral which so crippled our economy has been brought to a satisfactory level that we can expect business confidence to return in this country and we can expect confidence to return to the home building industry.

It is important to note that the Government has been consistent in pursuing three essential objectives within the housing area: Encouragement of home ownership, concentration on areas of greatest need within the community and ensuring economic conditions conducive to a stable and adequate building industry. All those primary objectives are related and of course, all have a significant bearing, on the home building industry itself. But I suggest that one cannot separate the needs of the people for housing from the needs of the particular industry. The building industry- especially the home building industryis a very important part of the economy. The Government’s efforts to create lasting economic growth are particularly relevant to the building industry.

The Government inherited a housing environment which has made progress quite difficult to achieve. Inflation, of course, was rampant until the time we took office. In particular, building costs had gone through the roof. The deposit gap was so great that home ownership was beyond the reach of an increasing proportion of young families. Welfare housing policies of the previous Labor Government ignored those within the community who were in greatest need. I suggest that a great deal has been done to provide more generously for the housing needs of Australians -indeed, all Australians- and also, as a result of those efforts, to assist those within the home building industry. The most important achievement, of course, has been the manner in which we have borne down on inflation. The facts speak for themselves and no one could argue with them. Inflation is now down to single digit figures. This has been of invaluable assistance to the particular industry that we are now debating.

Comments were made by the honourable member for Reid (Mr Uren) about the situation of housing finance. Again, many things have been done by the present Government to assist with housing finance and thus to encourage home ownership. We amended the regulations under the Banking Act in May 1977 to permit increased lending by the savings banks. In the

Budget Speech we encouraged lenders to increase lending for private houses. The former Treasurer and the present Treasurer (Mr Howard) have made a number of comments to encourage people within the lending industry to provide further funds for home building. We have provided additional funds for the Homes Savings Grant Scheme. I wish to make one or two comments about that scheme because it is relevant to this particular subject.

One point that I think needs to be made and needs to be made strongly but which would be in disagreement with some of the comments made by the honourable member for Reid is that there has been a firm increase in the volume of funds available for housing in the six months between July and December last year. There has been a significant increase in those funds. The total funds made available by building societies and by banks for home purchases and home building totalled $2,237. lm which was an increase of 5.2 per cent over the equivalent period between July and December 1976. 1 have just mentioned the Homes Savings Grant Scheme. The Government honoured its promise of introducing a new homes savings grant scheme. The new scheme, of course, is more liberal than the previous scheme which the Labor Government sought to abolish and, in fact, did abolish. There are no limitations on the value of the home or the age or marital status of applicants.

Mr Uren:

– I will drop a confidential document on you, if you do not watch out.


– The honourable member for Reid said that he would drop the scheme again. The scheme is on the basis of $1 for each $3 held in approved accounts. In this calendar year thousands of couples and single people around Australia will receive up to $1,333 under the Homes Savings Grant Scheme. This, of course, will be increased to up to $2,000 from 1 January next year for those people who have sufficient funds in the required accounts. At the moment, applications are running at the significant rate- a much greater rate than last year- of 1,100 applications per week and a substantial number of those applications are being granted. In this current financial year the scheme will put more than $34m into the hands of home buyers and into the hands of the people who are building their first homes. A substantial amount of that $3 4m will in fact go to the purchase of new homes and will, therefore, greatly assist the home building industry.

The honourable member for Reid mentioned welfare housing. I must make reference to the Commonwealth-State Housing Agreement. In 1977-78, a total of $390m will be advanced to the States of which $272m, that is 70 per cent, will go to State housing authorities for public housing and $1 18m, that is 30 per cent, will go to home builders accounts. There are, of course, needs tests applying to those amounts. The honourable member for Reid would not dispute that. In order to receive a housing grant for a family dwelling the bread winner’s income, excluding overtime, must not exceed 85 per cent of average weekly earnings. For a home builders account the limit on income is 95 per cent of average weekly earnings. Therefore, we are directing funds to those in greatest need.

A new agreement has been negotiated. I must compliment my predecessor, the present Minister for National Development (Mr Newman) for the great deal of work he did in negotiating with the State Ministers to create a new housing agreement which is a significant advance on the one that has existed for a number of years. The essential factor is that there will be greater flexibility for the State governments to decide how they might spend their funds and, in particular, how they might direct their funds to home purchasers. Again, this will greatly assist those people who are dependent upon the home building industry. It will indirectly provide surpluses for reinvestment within the housing industry and so will stimulate that industry.

I think it should be mentioned that the honourable member for Reid and, I suspect, other honourable members opposite have fallen into the old trap of misusing figures and statistics to support their cases and to suit their own ends. It is important that I should warn them, as my predecessor did, about the inherent dangers in plucking certain figures for a short period, such as one month, out of the air and holding up those isolated figures as a positive indication of the current state of the industry. To use the most recent figures on dwelling approvals and to say therefore that the home building industry is in a critical situation is to act in a most misleading way. The fact is that the latest figures issued for January are notoriously unreliable, as they are for each January. It is a month when councils meet irregularly for the purpose of granting approvals and the figures released at the end of January were for approvals. It is a well accepted fact that it is a more accurate approach to look at trends, that is, figures over a longer period than one month- perhaps a minimum period of three months, and preferably for a much longer period.

What is the current trend? As I mentioned earlier, following a short, sharp recession in 1974 recovery began in late 1975 and developed through 1976 when growth within the home building industry was quite strong. We then entered a flat period in 1977, essentially because of a substantial build-up of stocks. This flat period has been recognised by the present Government and, as I mentioned previously, a number of significant steps have been taken to rectify the position and an improving trend within the home building industry is now developing. The excess stock situation which was certainly critical during 1977- there was a substantial build-up of stocks of houses on the market during that year- is easing and excess stocks are reducing. I believe and the Government believes that the stock situation should not be an impediment to growth within the industry in the foreseeable future.

To summarise the situation generally, the Government anticipates a moderate level of growth within the home building industry during the present calendar year. During the calendar year 1977 there were 125,000 commencements. During the current calendar year 1978 the Government anticipates 132,000 commencements. The Government remains quite hopeful of achieving a figure higher than 132,000, especially as the general economy continues to improve. The situation is being carefully monitored by the Government. It recognises the comments being made within the industry and the concern felt in some sectors of the industry, particularly in some States. I think some of those comments were substantiated, at least in part, by some of the comments made by the honourable member for Reid. The Government is monitoring the situation closely. It rejects the contention of the honourable member for Reid that the current situation is critical. It is not critical at this time. It is improving. It will continue to improve as the Government continues to bear down on inflation and to reduce interest rates.


-Order! The Minister’s time has expired.

Mr Les Johnson:

– Although the time in which to prepare for this debate was very limited one would not need a great deal of practice to demolish the attitude of the Minister for Environment, Housing and Community Development (Mr Groom). I think it is appropriate that the honourable member for Reid (Mr Uren) should introduce this matter of public importance, namely the depressed state of the home building industry due to the inadequacy of financial support for the industry. The Minister, who is new to this area of parliamentary and public interest, probably has not had the opportunity to move around among the industry groups to ascertain the extent of anxiety and uncertainty which is in evidence. He needs only to turn on the radio here in Canberra on practically any morning to hear something about the depressed state of the housing industry in Canberra itself. If he were to go to any of the housing industry conferences, be they conferences of permanent building societies, terminating building societies, the real estate industry or the building unions, he would find that the same feeling of serious concern in evidence.

The fact of the matter is, of course, that housing is going beyond the reach of the people and the Government seems to be quite oblivious to that trend. Let me enumerate some of the statistical facts of the situation as outlined by the Australian Bureau of Statistics. It might be best if I go back a little way to the bulletin dated 2 February 1978 which, in dealing with building approvals to December 1977, states:

In seasonally adjusted terms the number of new dwellings approved in December 1977 (11,100) rose by 4 per cent when compared with November 1977 (10,700) but fell 12 per cent when compared with December 1 976 ( 1 2,600).

That is a very serious decline. The bulletin continues:

For the year ended December 1977 the number of new dwellings approved was 129,700 compared with approvals of IS 1,100 in the previous twelve months, a drop of 14 per cent.

If that does not reveal in the starkest possible terms a very serious downturn in the industry nothing possibly could. We could debate this very serious situation until we were blue in the face but apparently the Minister would never be impressed. The bulletin released by the Australian Statistician on 22 February 1978, in dealing with the number of new dwellings, states:

In seasonally adjusted terms the number of new dwellings commenced during December Quarter 1977(30,400) fell by 19 per cent when compared with December Quarter 1976 (37,700).

For the twelve months ended December 1977, the seasonally adjusted figure for the number of new dwellings commenced was 129,000 a fall of 10 per cent when compared with the figure of 144,100 for the previous twelve months.

These are not my figures. They are simply figures contained in the latest of the main statistical bulletins available and I doubt whether the Minister would, for a solitary moment, dispute the accuracy of this information. Again, the bulletin released by the Australian Statistician and dated 2 March, in dealing with building approvals for January 1978, states:

In seasonally adjusted terms the number of new dwellings in January 1978 (9,900) fell by 1 1 per cent when compared with December 1977 (11,100) and 24 per cent when compared with January 1977(13,000).

There it is in hard, factual form. The Government cannot get away from that situation. Nothing is happening as regards governmental initiatives. It appears to me that this Government has virtually abdicated its responsibilities in connection with the housing prices. We hear the platitude about turning everything over to the States. It is a matter of turning over the responsibility but not the wherewithal to enable the State governments to take up the slack which has been created by this Government’s abdication of responsibility for housing and so many other areas. When one compares that with the great range of initiatives taken by the Labor Administration from 1972 to 1975 one begins to understand why this deficiency has occurred.

Where is the new Commonwealth-State housing agreement that has been talked about for a long time? We have seen some of the indicators emerge. All we know is that something very serious is about to happen that is bound to have the effect of increasing housing interest rates and imposing a greater burden on low income earners, whether they be buying houses or paying increased rents through the reflected increase in interest. That undoubtedly will be the situation. It seems to me that the Government will go on from that to put new dependency onto the Housing Allowance Voucher Experiment scheme- the HAVE scheme. It is simply a Fraser Government device to get welfare housing out of the custodial care of the corporate caring process of governments and into the hands of the private sector. People will be hounded out of their housing commission homes. Soon we will have some kind of dictum to that effect.

Where are the new initiatives? Last week a delegation of pensioners from my electorate wanted to know the truth about allegations that the Government was going to curtail the benefits available under the States Grants (Dwellings for Pensioners) Act and that the Government was going to reduce the amount of money available under that legislation. We know that the Government has already slashed the funds available for pensioner housing through the subsidy schemes. Those subsidies have been reduced from a $4 for $ 1 basis to a $2 for $ 1 basis. Where is new hope for the young people of this country represented by any attitude or proposal coming forward from the other side of this chamber? Has there been a solitary suggestion?

We have heard much about the homes savings grant scheme and the amendments that have occurred under that heading. The effect of all that is simply that this Government is intent on getting money into the hands of people irrespective of whether they have a genuine housing need. Money which previously went to the deserving home-seeker is now being given to people who, in many instances, do not need any assistance at all. In fact, the Government is not taking any steps to ensure that the money it is giving under the homes savings grant scheme is even being used for housing. The Government cannot even deny my contention that often that money is given to wealthy people who use it for overseas trips or to buy motor cars, jewellery, fur coats and all kinds of things. That is not to say that there are not people among them who are deserving of that kind of assistance. It is the contention of the Opposition that the Government should be making government funds available to the deserving. I strongly criticise the lack of discernment on the part of Government supporters so far as this blatant handout is concerned.

I suggest that new initiatives should be taken by the Government. Foremost among those initiatives is the need to get funds into the hands of terminating building societies, which in turn can make money available, as they did under the Labor Government, to people around the average weekly earnings income level at an interest rate of about 5Vi per cent. There should be an element of subsidy similar to that given to people whose income is low enough to attract support from the housing commissions. If Government supporters look at the reports of the Indicative Planning Council, which is another authority set up by the Labor Government, they will find that our housing needs and our capacity to produce housing is falling short. Everything reflects incompetence on the part of the Fraser Administration. Unless something is done we will see the deterioration of many social standards brought about through the inadequacy of housing.


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


-This Government has acted to increase the opportunity for home ownership of a wide range of Australians. Today the Opposition came into this chamber with a poorly worded, poorly prepared motion. The Opposition cannot get enough speakers into this place to present a reasonable argument in support of its motion- a motion which it introduced as being one of public importance to this country.

Let us look at some of the facts. Let us look firstly at some of the initiatives this Government has taken to assist the home buyer. One is the introduction of new homes savings grant scheme, which was denigrated by the honourable member for Hughes (Mr Les Johnson). His speech indicated that home buyers should be made aware that any future Labor government would move to remove this opportunity for home ownership in Australia. We have been given the red light in this regard. Home buyers should take note that any future Labor government would discontinue the home savings grant scheme. That scheme has been in operation for only two years but more than 46,000 people in Australia have already taken advantage of it. It is an imaginative program.

The Government has revised the home interest tax deductibility scheme in such a way that it concentrates on assisting home buyers in the early years of home ownership and those people who battle against circumstances to establish a way of life and a home for themselves and their families. We have extended the activities of the Housing Loans Insurance Corporationthe HLIC- to give it a greater degree of commercial and operational flexibility. As time goes by, some of those amendments will prove to be most substantial. The Corporation is already insuring loans to 100 per cent of valuation. The Corporation will insure a wider range of loans, including loans to builders and developers for land acquisition and development and subsequent dwelling construction.

It would seem to me that the role of the Corporation has been encouraged and enlarged. Because of its success in the past, success is assured for the future. The HLIC has moved towards providing insurance for loans for rental housing projects and loans made by government instrumentalities, such as State superannuation funds. In the middle of the year we will see the introduction of a completely overhauled CommonwealthState Housing Agreement and a capacity for the HLIC to widen the eligibility for subsidised home loans and to distribute available funds more efficiently so that people who are living in housing commission or housing trust premises will have a capacity to purchase under reasonable conditions and at 100 per cent valuation, if necessary, those homes which they have spent their lives improving and in which they have raised their children.

The honourable member for Hughes came into this chamber poorly prepared and not knowing what the motion was all about. He said that it was the same old thing. It is not the same old thing. We have moved a long way past the days of 1 975 when there were high interest rates and a general incapacity in the country. We now have a government which is committed to home ownership and a government which has taken numerous initiatives to strengthen the opportunity for home ownership. If we look at the public housing area- the area of welfare- we must recognise the Government’s sympathy for those people who do not have the capacity for home ownership and who need shelter, encouragement and provisions for the growth of their families. The State governments have agreed to a new housing agreement. Substantially they have said that it is an innovative program and one which will give the Federal and State governments increased opportunities to serve better the people they represent. The new agreement will increase the opportunities of moderate income earners for home ownership. Again the emphasis will be on home ownership for the low income earner. It will provide cheap money for the State governments to build rental housing for those in need. That has been a traditional role of housing commissions and of the Commonwealth-State Housing Agreement. Subsidies provided by the taxpayer will be directed to those most in need. There will be provision for the States to allocate funds to voluntary groups or local government where those agencies are better able to assist in providing housing services.

The new agreement will also encourage the States to give additional attention to the environmental aspects of public housing, such as urban renewal, provision of open space, landscaping and community facilities. One of the shortcomings of all previous agreements has been a lack of understanding of what housing trusts and commissions should be doing. They saw their role entirely as one of providing cheap accommodation, giving no thought to families and individuals, whether they be elderly or young, or the surroundings in which they would be living. So often we have seen this sort of development become a ghetto and a blot on our society. Now, under the new Agreement, provision is made for note to be taken of the environment, the surroundings and the way of life of the people involved.

Mr Les Johnson:

– That is under the old Agreement; you have never read the agreement.


– I will come back to the substance of the matter of public importance which the honourable member for Hughes neglected and in relation to which he was so badly prepared. The Opposition takes great delight in seizing upon the figures for one or two months and stating that they indicate a trend in the building industry. I refer Opposition members to a statement made in the middle of last year by the previous Minister for Environment, Housing and Community Development, the present Minister for National Development (Mr Newman). He said that he was concerned at that stage because he felt that ‘taking the overall view for the rest of this year I think, particularly because of the build up of stocks and because of the level in the last half of 1976, we could see some decline in the general activity in the building industry in 1977’. The previous Minister recognised that the circumstances prevailing in the industry were being met and that the demands and requirements of the industry were being met by the Government. The circumstances were such that he could see some decline occurring. We have witnessed that decline, but we also have an assurance that these minor fluctuations, compared with previous fluctuations which occurred under the Labor Government, are not substantial and in fact will be ironed out in the forthcoming year. It would also be obvious to those people interested in the building industry that the moves taken by the Government to reduce inflation and to create a sustained economic growth must benefit the housing industry.

One of the important factors in the cost of housing, of course, is the interest component of repayments. With interest rates being reduced, that must give Australians a better capacity to own their own homes. Of course, a response to lower interest rates does not take place overnight, but the Government’s intention, the Government’s commitment- in fact, the Government’s action- indicates that pressure is being exerted to lower interest rates. They have started to move down; they will continue to move down. Nothing will provide a better stimulus, a more substantial and long-lasting stimulus, to the building industry than the lowering of interest rates. The Government’s action is not an artificial pump-priming action to pour money into government-sponsored or government-built homes. The government component comprises only eight per cent to 10 per cent of the total building industry in Australia. Honourable members opposite are telling me that if we doubled that figure we would provide some sort of stimulus in the Australian building industry. I respond by saying that such an increase would be inconsequential. We need a sound economy, a lowering of the inflation rate and a lowering of interest rates if we are to provide any sort of sound stimulus for the building industry.

I point out to honourable members some of the factors that appertained while the present

Opposition was in government. Up to and including 1972 the average price for a new house and land varied between 188 and 195 weeks’ earnings at the prevailing rate of average weekly male earnings. The price of the new housing package shot up to 219 weeks in 1973 and 227 weeks in 1974. What could be a greater indictment of the Labor Party, that once great Party, whose members sit opposite? What could be a greater indictment of its policies and its lack of understanding of the needs and aspirations of Australians? It would seem that the present Government has adopted- I am convinced that that is the case under our new and dynamic Minister for Environment, Housing and Community Development (Mr Groom)- an innovative program. It is a program which indicates good management, which is something that the Opposition cannot claim. The Government has made a commitment to support home buyers- a commitment which the Labor Party would seek to reverse.

The superfluous matter of public importance which is before the House is time wasting and is based on inconsequential argument and inconsequential facts and figures.


-Order! The honourable member’s time has expired. The discussion is now concluded.

page 517


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

Second Reading

Minister for Business and Consumer Affairs · Farrer · LP

– I move:

The purpose of this Bill now before the House is to give effect to the Government’s decision to introduce a scheme, to reduce the prices paid for certain petroleum products by consumers in country areas throughout Australia. Products to be covered by the scheme will be motor spirit, power kerosene, automotive distillate and aviation fuels.

Honourable members will recall that the Prime Minister (Mr Malcolm Fraser), in the course of the last election campaign, stated that prompt steps would be taken after the election to implement a scheme which would subsidise freight differentials involved in transporting eligible petroleum products from refining ports and seaboard terminals to country sale points. These freight costs constitute a substantial element of the relatively high prices paid by rural consumers particularly in the more remote areas for various petroleum products.

The proposed scheme will subsidise country freight differentials to the extent that country consumers of products covered by the scheme will pay a price which includes no more than 4c per gallon of the transport costs. The scheme will operate by means of grants made by the Commonwealth to the States pursuant to section 96 of the Constitution. These grants will be in amounts equal to moneys expended by the States in subsidising sales of eligible products by oil companies and other registered distributors, provided such payments are made in accordance with legal schemes formulated by the Minister for Business and Consumer Affairs under the Act. These legal schemes will formally set out the respective roles of the Commonwealth and the various States in the implementation of subsidy arrangements and will detail the relevant administative procedures.

The freight differentials to be subsidised are based on costs submitted by individual oil companies to the Prices Justification Tribunal and accepted by that Tribunal. Rates of subsidy are calculated by deducting from these differentials that part of the freight cost to be borne by consumers, namely 4c per gallon approximately 0.9 cents per litre. For example, in the case of a freight differential of 10c per gallon the consumer will pay 4c only and the remaining 6c will be covered by subsidy under the scheme.

Provision exists in terms of section 4 of the Act for the Minister to amend the scheme by varying rates of subsidy set out in the schedule of subsidies which is an integral part of the scheme and lists the subsidy rates applicable at some 8,000 locations throughout Australia. This provision enables account to be taken of requests by oil companies for variations in differentials in cases where freight cost charges have been established to the satisfaction of the Prices Justification Tribunal. Section 7a of the Act requires all amendments to the Schedule of subsidy rates to be tabled in the Parliament in the same manner as regulations. Disallowance by either House would result in the amended rates being revoked and previous rates continuing in force. Section 7 of the Act requires copies of the schedule and of all amendments to the schedule to be published in the Gazette.

The legal schemes in relation to each State provide that claims for subsidy are to be made only by oil companies and other distributors registered under the scheme by the Minister. Before such distributors may be registered they must enter into an agreement with the Commonwealth that they will pass on to consumers the full benefit of subsidy received in respect of all sales made at locations in the schedule. The States Grants (Petroleum Products) Act 1965, which it is proposed to amend by this Bill, formed the legal basis for the previous subsidy scheme. This scheme was terminated by ministerial action in 1974. The Government considers, however, that a scheme of such great significance to rural consumers of petroleum products should not be capable of termination by ministerial action only without reference to the Parliament. Accordingly, the Bill before the House provides that, except as authorised by a resolution of each house of the Parliament, the Minister shall not revoke or otherwise terminate the operation of the scheme.

The earlier scheme also involved appropriate complementary State government legislation. This legislation is still extant and with certain amendments will be suitable for the same complementary function in the new scheme. The scheme will come into effect after the required State legislation amendments are effected. The scheme will operate in the Northern Territory on the basis of an ordinance of the Legislative Assembly of the Territory and an administration scheme legally formulated under that ordinance.

Honourable members will appreciate that the proposed Australia-wide scheme is directed solely to subsidising freight costs in excess of 4c per gallon. It will therefore have no effect on the prices of petroleum products in metropolitan and other areas where freight differentials do not exceed the 4c subsidy margin. In addition, I would point out that the scheme is not related to, and will have no effect on, present motor spirit discounting practices whereby resellers in some areas are prepared to operate on the basis of minimal margins and large throughputs. The proposed subsidy scheme will substantially benefit large numbers of Australia’s rural citizens whose economic activities and general well-being are so heavily dependent on the availability of reasonably priced transport and machinery fuels. I commend the Bill.

Debate (on motion by Mr Hurford) adjourned.

page 518


Reference to Public Works Committee

Mr McLeay:
Minister for Construction · BOOTHBY, SOUTH AUSTRALIA · LP

– I move:

That, in accordance with the provisions of the Public Works Committee Act 1969, the following proposed work be referred to the Parliamentary Standing Committee on Public Works for Investigation and Report: Re-development of airways facilities, Adelaide Airport, S.A.

The proposal is for the construction of buildings to house improved operating facilities at Adelaide airport to overcome present deficiencies in aviation safety services and to enable safety to be maintained with traffic growth. The proposal comprises: An operations building to accommodate area approach control, flight service centre, the necessary control equipment and training facilities; a services building containing a transformer for the provision of primary power, essential power generation and air conditioning plant; an air traffic control tower accommodating an elevated control cabin, support control equipment and essential power and air conditioning plant; and associated site works, car parks, roads and engineering services, sewerage and drainage and security fencing to the operations building and services building area.

All buildings will be steel framed and clad externally with asbestos cement sheeting. With the exception of the services building which will be naturally ventilated, they will have thermally insulated external walls and ceilings and be air conditioned. Operation areas will be sound attenuated against aircraft noise. All buildings will have fire detection systems installed and fire extinguishers will be provided. The estimated cost of the proposal at March 1978 prices is $2. 35m. I table plans of the proposed work.


-On behalf of the Opposition I welcome this motion and express support for it. At this stage, as the Minister for Construction (Mr McLeay) has said, the proposal for redeveloping the airways facilities at Adelaide Airport will be referred to the Public Works Committee. I hope that the Committee will facilitate the examination of this proposal. Some of us, like the Minister and me who come from Adelaide, know just how limited in many ways the facilities are at the airport. I have not had time to examine this proposition in detail in order to be able to express a view as to whether other improvements which are not included in this proposal ought to be made to the Adelaide Airport.

Generally speaking, the attitude of the Labor Opposition is that now is the time, if ever there was a time, for many public works projects to be funded in order to reduce the number of unemployed and to reduce the under-employed services that are available to be used on this sort of work right now. So often it is only those proposals which go through this Parliament and which we oppose that get publicity. This is one of the many proposals that we support. In fact I would not be at all surprised, when we have a look in detail at the proposal, if we supported even more work being done.

Question resolved in the affirmative.

page 519


Second Reading

Debate resumed from 2 March, on motion by Mr Fife:

That the Bill be now read a second time:


-This is another occasion on which the Opposition is pleased to support a Government proposal. Once again, as I said in relation to the motion that was agreed to only a moment ago, we are not expecting a great deal of publicity in the country for this measure because there is no controversy about it. The Bounty (Polyester-Cotton Yarn) Bill 1978 grants short term assistance by means of a bounty to a particular producer of polyesterCotton yarn. I am informed that at the moment there is only one producer of this yarn, and that is Bradmill Industries Ltd, whose works are at Kotara near Newcastle in New South Wales.

The first point to be made is that the assistance is for a short term only. The amounts available for the bounty are limited to $600,000 for each of the 12-month periods which commence on 1 October 1977 and 1 October 1978 and a further $550,000 for the final 1 1 months commencing on 1 October 1979. By August 1980 the provisions of this Bill will no longer apply. The reason for that is the further examination of long term assistance for the industry being made by the Industries Assistance Commission. Its report is expected to be received towards the end of 1978. We expect even this Government to have made up its mind on the report concerning long term assistance by the time the bounty terminates at the end of August 1980. Another point to be made about this bounty is to remind the House that it will be provided at the rate of $1.15 per kilogram of yarn. That is set out in the Bill and in the second reading speech of the Minister for Business and Consumer Affairs ( Mr Fife).

I have said something about the main provisions of the Bill and mentioned, as background, that the assistance is relatively short term. I should say also that the bounty implements one of the recommendations of a report of the Industries Assistance Commission, namely, report No. 138 of 19 July 1977. I find that report quite complicated inasmuch as it covers a wide variety of products. It is headed, ‘Certain Spun Yarns and Wool Textiles and other Goods’. However, honourable members will obtain a better idea of how diverse are the products about which the report is made when I read through the contents of the report. It relates to cotton, cotton blend and substitute yarns, hand-knitted yarns, carpet yarns, other woollen and worsted yarns and fabrics, rugs and blankets, sleeping bags, woven pile fabrics, and knitted net fabrics and curtains. In addition to all those goods, a chapter of the report also deals with other goods.

The Minister will understand that I have taken over my duties in respect of this shadow portfolio fairly recently. I suppose that he still considers himself a new boy to a certain extent. I would be glad if, in his reply to this second reading debate, he would tell us something about the other recommendations contained in this very diverse IAC report and the intentions of the Government in relation to those other recommendations. Not only is the report very diverse, as is evident from that list of subjects which I have just read to the House, but also within the heading of cotton, cotton blend and substitute yarns, one must recognise that at least three sub-headings are included in the chapter. They relate to viscose cotton, including polynosic cotton threads, polyester cotton and PVA natural fibres. Indeed, it takes a fair amount of study of the chapter to ascertain what the IAC is saying that applies to polyester cotton itself.

I have another question of the Minister which I would be glad if he would answer in his reply: What is the current rate of duty on polyester cotton yarn? The House must recognise that what is being proposed here by way of this bounty of $1.15 per kilogram is an addition to the present rate of duty. My problem arises in respect of what is stated on page 9 of the report. Paragraph 3.8 states:

However there is some contention about one of the by-laws applying to cotton blend yarns- BL7753573 relating to multiple or cabled polyester/cotton yarn where each and every ply is finer than 1 7.4 tex. Bradmill originally requested that this by-law be amended to exclude natural yarns for knitting, but subsequently withdrew this request. It is not clear whether, and to what extent the demand by knitters for twofold polyester/cotton yarn of the type admitted duty free under this by-law, has been encouraged by the duty free facility. In view of the uncertainty surrounding this issue, and since there is limited local capacity to supply doubled yarn, and since Bradmill revised its request, imports under by-law of polyester/cotton yarn have not been included with competitive imports.

Perhaps there is a simple explanation but it seems that this bounty could apply to some imports which are already entering Australia duty free because of a particular by-law. I would like the Minister to devote attention to that in his reply. I mentioned that, on the face of it anyway without making an assumption about the answer that the Minister will give me shortly, there is an existing 15 per cent duty. I have said already that the beneficiary of that duty is Bradmill Industries Ltd of Kotara. But I should say also that with the introduction of this bounty and with the 15 per cent duty possibly another producer, Bond’s Spinning Mills, may be able to put into production, with some alterations to its equipment, and supply this yarn.

It is very awkward to extract only this part of the IAC report and devote attention to it when discussing a Bill like this one without recognising that, in this chapter of the report anyway, the other types of yarns are themselves a substitute for polyester cotton yarn to which we are devoting attention. That has to be realised to understand why the Industries Assistance Commission came to its decision, namely, that this yarn should be the subject of a bounty. There is no doubt that the producer- Bradmill- would have preferred the assistance to come in another form. Those honourable members who have read the chapter of the IAC report dealing with this matter will know that the first option Bradmill preferred was a tariff quota. Its second preference was an increase in the tariff itself. A third option was a market sharing arrangement. It is only the fourth option- the bounty- which is recommended by the IAC and which is the subject of this Bill.

The Opposition welcomes the recommendation of the IAC and the decision of the Government. There are advantages in the application of bounties vis-a-vis alternative forms of assistance. Firstly, unlike tariffs and quotas, they do not raise the price of the protected product to consumers or consuming industries. In other words, they do not add to inflation. Secondly, when financed from general government revenue, they are less inequitable than tariffs or quotas in the sense that their costs are shared by all and not just by consumers of the product. Thirdly, since bounty payments are based on annual Budget appropriations, they are more open and subject to greater public scrutiny than tariffs or quotas in relation to which costs are largely hidden. So where possible we support the use of the bounty in order to protect jobs which, of course, is the purpose of this measure. I will not detain the House any longer on this subject, other than to repeat that the Opposition welcomes the Bill and hopes that it will have a speedy passage through this House.


– I have no particular brief with respect to the textile industry or with respect to this Bill, the Bounty (Polyester-Cotton Yarn) Bill, so I am in the same position as the previous speaker, the honourable member for Adelaide (Mr Hurford), in that regard. However, involved in the Bill is a number of very important principles which ought to be canvassed because they are very appropriate to the consideration of events in Australia today. As I look through report No. 138 of the Industries Assistance Commission on which the Government’s decision quite obviously has been made, several things become crystal clear. The bounty in respect of which the decision has been made will apply to seven producers. I will read out the names of those producers. I think that there has been a takeover in respect of one of these, so I will read them out as listed in the IAC report. The companies are Bradmill Industries Ltd, Bond’s Spinning Mills, Actil Marketing Ltd- I think Actil has been absorbed by one of the previously mentioned companies- -Supertex Industries Ltd, Gold Coast Textiles Pty Ltd, Rocklea Spinning Mills Pty Ltd and Yarragon Textile Mills Pty Ltd. One of those firms was in particular trouble. Quite clearly, part of the problem was due to a lack of demand in Australia and to imports providing competition with which those firms were not able to keep pace.

One or two other points in this IAC report are quite important. Before I deal with those points in detail, I shall deal with the general principles which are contained in IAC reports, especially those on the textile and clothing industries, of which this industry is part, and to which the present Chairman of the IAC, Mr McKinnon, has referred. I merely remind the House that in the middle of last year he made it quite clear that the quantitative reallocation of resources in Australia which occurs on account of industry protection of one kind or another was more than $4,000m some years ago and is certainly more than $5,000m today.

Some questions need to be asked not only with respect to this Bill but with respect to all matters of industry assistance. Those questions are: Who enables the subsidy to be paid? Who benefits and who pays? I shall return to those questions over and over again in considering the matter of industry protection in Australia. The principle which I hold is simply this: The subsidiser. should not have household living standards lower than those who receive the subsidy. To put it in terms which are most appropriate to the Australian Federation, those States which effectively are the subsidisers should not have a living standard lower than those States which are the net recipients of subsidies through industry protection of one kind or another. I believe that that is a very valid social principle. It also happens to be a very valid economic principle; it is often called the principle of equal marginal social product. It is appropriate in this case.

Having stated that principle, I am intrigued by the fact that in this Bill a bounty has been chosen. T applaud the fact that a bounty was recommended and chosen to be supported by the Government. Previously bounties have applied more to rural products than to products of secondary industry. One famous case is that of tractors. Over more recent years bounties have been provided for machine tools and other products. I can only support the honourable member for Adelaide (Mr Hurford) who quite correctly and validly indicated the benefits of choosing a bounty rather than tariffs or tariff quotas. A bounty is certainly of far greater benefit to the ultimate consumer. It is a better index for industry, showing where the principal benefits ultimately lie. Of course, Bradmill and others wanted tariffs or tariff quotas rather than a bounty. Not the least reason for that preference is that there is some vertical integration in the industry.

When tariffs are applied in an industry in which there is vertical integration, the benefits flow throughout the whole process. It is on that basis that there has been considerable trouble over recent years in separating what are nominal tariffs from what are effective tariffs. For that reason those entrepreneurs and industrialists wanted the other form of assistance, but the consumers of Australia would not want it. That certainly needs to be recorded. On page 22 of the IAC report a superb justification for the Commission arriving at its decision is given. It states:

Assistance in this form -

That is, a bountywould meet the present needs of the industry more quickly and would limit the level of assistance to the volume of production it could reasonably be expected to achieve. It would also avoid the high costs to users and consumers associated with the use of tariff quotas or an additional duty on imported yarns.

So I believe that the IAC reached its decision on correct economic and social grounds.

Who benefits? Ultimately the 2,300 to 2,500 employees, managers and entrepreneurs in the industry benefit. The work force in this industry has declined. As indicated on page 8 of the IAC report, it has declined from 2,700 in December 1975 to 2,300 or 2,400 in April 1977. What is the benefit to each employee in the polyester-cotton yarn industry, which is part of the textile industry? The bounty provides $260 to $270 per employee per year in order to keep people in employment. That is not a large subsidy; but it is a subsidy. The cost to the subsidiser and the benefits to the recipient of the subsidy should be repeated over and over again.

Profitability in this industry is not high. On page 9 of the IAC report the witnesses who gave evidence to the Commission on behalf of firms stated that in the case of their firms over the four years to 1975-76 the return on funds used was 11.2 per cent, 10 per cent, 2.5 per cent and 6.1 per cent. Of course, the profitability of the textile industry as a whole is much higher than that. As was pointed out in a superb article in the Canberra Times on 2 March 1978, the profitabilitythat is, the ratio of operating profits to funds employed- of the whole textile industry for 1975-76 was of the order of 22 per cent plus. So an increase in employment in these industries will not be created merely by increasing their profitability.

Mr Holding:

-That is right.


– That is right. That is the principal reason why the Oppositions ‘s payroll tax proposition in the last election campaign was dreadfully wrong and unfair. Increasing profitability does not increase employment. The principle involved in supporting the IAC’s decision to recommend a bounty is the same principle as was used to reject the payroll tax proposition of the Opposition and its imagined effect on employment in the last election campaign. In Australia the proposition of zero growth with increasing employment in industry, which finds it very difficult to reallocate resources, is an impossibility. It just cannot occur. I turn now to the textile industry. I wish to refer for just a few moments to some of the reallocations of resources that are involved. I shall return to this theme in this House over and over again. It has become clear to me that in times of economic restraint, or economic recession, certain parts of Australia are far more vulnerable to the effects of that restraint than are other parts. The State of the honourable member for Melbourne Ports (Mr Holding)Victoria always does magnificently well in times of economic recession. It does very well compared with the rest of Australia. My State, because of the lack of the transfer involved in measures such as this, does very badly.

I shall illustrate quite quickly one point concerning the textile industry. According to the IAC’s draft report on the textile, clothing and footwear industries- I shall refer only to the textile industry, which is the industry with which this Bill is concerned- the net subsidy equivalent given to the textile industry in 1975-76 was of the order of $ 1 20m plus. That is big money. It is also clear that the subsidy given to the textile industry a year earlier, which would have been a little lower, was of the order of $2,960 per employee.

That is all very well. But I went a little further and found that there were 40,000 people employed in the industry in Australia in December 1976-1 do not like using too many figures- and that the recipients of that subsidy were broken up on the following State basis: 11,000 employees in New South Wales; nearly 23,000 employees in Victoria; 1,100 employees in Queensland; 2,200 employees in South Australia; 800 employees in Western Australia; and a little over 2,000 employees in Tasmania. I shall now transfer the benefits from State to State to illustrate the point I am making. I believe this is the crux and the kernel of the argument I shall put. The benefit through measures such as this which transfer assistance to industry in terms of the States in 1974-75, which understates the figure in terms of this year, is as follows: New South Wales received $34m of the $120m total; Victoria was fortunate to have received $70m; Queensland received a little over $3m; South Australia received $6.5m; Western Australia received $2. 3m; and Tasmania received $6m. All I am saying is that in circumstances where it is argued that the reallocation of resources in Australia is important and has to be considered, part of the measures to determine how those resources are to be reallocated has to be the net subsidy equivalents of tariffs, quotas, bounties and other forms of industry assistance. That argument has to be on the table in the future and not under the table.

It is not sufficient for a government in times of economic restraint to say: ‘We are going to cut public expenditure’, which may be a correct economic decision, and to say: ‘We have to cut capital expenditure; we will cut that’, if at the same time the subsidy equivalents of the use of the external trade powers continue on, are not measured and are not cut. In every recession from Prime Minister Scullin’s day- that was a depression for which he was not responsible- the reaction of every government has been to cut public expenditure, which is a decision with which I am not arguing, and to increase the transfers as pan of the use of the external trade powers. We want those transfers measured and discussed by the States at an appropriate forum, such as a Premiers Conference. That is the precise reason why in times of economic restraint some States are much more vulnerable than others.

I refer again to the principle which I stated when I began my speech a few moments ago. The subsidisers should not have to experience a standard of living lower than that of those who are receiving the subsidy. Because of the way in which affairs have been managed in Australia over the years that is the actual situation at present; it is the case. I am not making an argument with respect to free trade; I am making an argument with respect to fair shares and fair returns for equal products. To diverge for one moment, those people who scarify and lacerate the Hamersleys and the Utahs of this world do themselves a stupid injustice because the value of the output of those producers is what enables those bounties and net subsidy equivalents to be paid to the industries which happen to be situated in some of the industrialised States in the south eastern corner of Australia. It enables the return per person engaged in those industries to be greater than the increase in the value of output attributable to those people. So it should be. But let us have the equalising mechanism put in order and put in train.

This Bill is welcome. Its provisions have been recommended by the Industries Assistance Commission in the best manner possible. The use of the bounty deserves to be applauded. The actual subsidies involved in this Bill are relatively small. The subsidies involved in the group of industries of which the one dealt with in this Bill is a small part are relatively very large. We merely request that the amount of those transfers be known, calculated, measured and discussed within the Australian federation. I return again to the position of my own State, which receives very little from this legislation. It is not sufficient that that State, which is the largest exporting State in Australia and hence the State which, together with Western Australia, enables those subsidy equivalents to be paid, should have the lowest standard of household living in Australia at the present stage.

There is something wrong with the distribution of resources within the economic federation of Australia. It is not sufficient that 8.5 per cent of the work force of Queensland be registered as unemployed when subsidies are going from that State to other parts of the Commonwealth. It is not sufficient that there be one job newspaper advertisement for every 1,200 people in the State whereas some of the subsidised States of Australia, according to the ANZ Banking Group Ltd’s index, have a newspaper advertisement for every 500 or 600 people within those States and that the deterioration should be likewise. The people of Queensland should not be the wood and water Joeys of the Commonwealth. I support the Bill. It deserves support. The principles on which the IAC has made its determinations deserve to be applauded. Over and over again I shall return to this aspect of economic federalism in Australia. The IAC, in making the type of determination it has been making, is doing a service for this country for which it deserves to be applauded.

Mr DEPUTY SPEAKER (Dr Jenkins)Before I call the honourable member for Brisbane, I point out that this Bill deals with polyester-cotton yarn. I allowed some latitude to the honourable member for Lilley but it would be out of order in regard to both the nature of the Bill and the presentation of the Bill by the Minister for Business and Consumer Affairs for the House to go into a general debate on this question.

Mr Peter Johnson:

– In supporting this important piece of legislation this afternoon I feel that some background ought to be given as to how the Bounty (Polyester-Cotton Yarn) Bill has come about, what it will do and how it will assist an important section of the garment and textile industry which has needed and will continue to need a degree of assistance in the years to come. Briefly, the purpose of this Bill is to grant short term assistance by means of a bounty to Australian manufacturers of polyester-cotton yarn. The main provision is that a bounty will be payable to the manufacturer on the production of yarn consisting of a mixture of polyester and cotton fibres. This measure has come about because the extremely high increase in imports in Australia has resulted in the total production of cotton weaving yarns dropping from 19.4 million kilograms in 1975-76 to 14.3 million kilograms in 1976-77 and spinning yarn production dropping from 5. 1 million kilograms to 4.8 million kilograms. We often hear it said- articles were quoted in various speeches today- that we should not have protected industries and we should not be thinking along the lines of assisting this important section of Australian industry. This is something which I abhor. I will refer later to the situation facing Bradmill Industries Ltd. Some honourable members have said they do not care that 300 people have lost their jobs. These members have criticised the fact that certain garment manufacturers and textile producers in this country have in the last few days declared reasonable profits. These members are the first ones to criticise the manufacturers and say that their profits are too high. May I remind those people who are being critical that we derive tax revenue from profits; we do not derive tax revenue from losses. If we have high profits we have high tax revenue.

Local producers supplied about 29 per cent of the local demand for fine-count combed cotton and cotton blend yarns in 1975-76, but unfortunately that fell to 24 per cent in 1976-77. Stocks, unfortunately, increased and orders declined substantially in 1976-77, due to an increase in imports and a lack of concern by certain sections in the Australian economic scene about the difficulties which these very important technical people were facing. They could not produce a yarn that competed successfully with yarn that was produced overseas, both natural fibre in the form of cotton and synthetic fibre in the form of polyester. The manufacturers went to the Industries Assistance Commission. The IAC, for once, took account of the full situation and considered all the relevant evidence, not just part of it, as has been its wont on a number of occasions. The IAC looked at this whole situation and recommended a bounty. It did this in preference to recommending tariff quotas or additional duties, in order to assist this very important section of industy more speedily and to reduce the cost of the end product to the consumer.

Under this Bill the bounty payable is $ 1 . 1 5 per kilogram. This was the estimated difference between the landed duty paid price of imported yarns and the ex-factory price of comparable local yarn. May I say that I believe that the Australian industry has unfairly received a good deal of criticism from many ill-informed people. Recently I had the opportunity to spend some time in Sydney and look at some new processing equipment which is the first of its kind ordered in the world. It was not ordered by a German company, an English company, a continental company or an American company. It was ordered by the Australian group Bond’s- Wear Pty Ltd- Coats Patons (Australia) Ltd. There has been a most revolutionary and most significant breakthrough in cotton yarn manufacture. It has been in the very important area of spinning. It has been by Bond’s. The process which Bond’s now uses has meant that in the last three years it has been able to increase production by 10 per cent without a lc increase in the cost of production. This firm is selling the product at the same price it was selling that product three years ago.

Open-end spinning equipment has recently been developed. This process not only spins at approximately five times the speed of the latest conventional machinery but also eliminates the need for two other operations, stubbing and winding. The yarn produced by this system is suitable for selected apparel knitting purposes, and Bond’s is currently converting its Lithgow mill to this system. On the basis of the machines already installed which I saw operating in Sydney, it is likely that Bond’s will be able to reduce the labour content of its Lithgow factory and at the same time, because of the increase in productivity, be able to employ more people in the garment manufacturing area. I am pleased to see that at present in this area Bond’s employ in the vicinity of 2,000 people, which is an increase in the number of people it employed previously. This has come about because of its confidence in the future of the industry under this Government. Under the previous Administration, with its academic theorising on a 25 per cent tariff cut, we ended up with a lot of people who unfortunately lost their jobs.

I think the matter of bounties is totally different to the matter of tariffs and quotas. The argument as to why we should introduce a bounty system in this area of polyester-cotton yarn is interminable. I believe that we should explore every measure that would ensure a safe and secure industry. I also believe that governments must give industry the degree of assurance that it needs. I refer to the Bradmill situation and to the type of equipment which that firm has introduced in the area of polyester-cotton yarn. Bradmill may need 12 months to do a feasibility study on the best equipment available at the most reasonable price, to import that equipment, to install it, to get the initial production runs going correctly and then start producing so that it will get a return on its investment in that equipment. In some cases this may take 24 to 30 months- two to 2¥t years. Unless an industry has an assurance from the Government that at the end of 12 months the Government will not change its mind, as we saw during previous administrations, then there is no way in the world that industry can invest in new plant and equipment in the years ahead.

New equipment is being produced. I was able to observe at the Bond’s factory new equipment developed by Bond’s engineers which has been found to be an extremely worthwhile and highly profitable innovation. Bond’s itself has taken out world-wide patents and is selling to the world equipment which has been developed by its own engineers. I believe that it is terribly important that any form of assistance, including the bounty that we are talking about today, which will ensure that those industries which need assistance keep on going, should be forthcoming. The spin-off from giving this assistance is in the number of people that these industries employ. Anyone who travels through New South Wales country areas, Victorian country areas, indeed even Queensland, to a lesser extent South Australia and most definitely certain parts of Tasmania, will see that many people are employed in these industries and are involved in them because these industries have been decentralised and are located in rural areas. A number of very important advantages are to be gained from assisting these industries to survive. The cost has to be considered. However, if honourable members consider the cost of the assistance that we give industries in this country and the amount of imports which come into this country in comparison with the situation in the major trading countries which are signatories to the General Agreement on Tariffs and Trade they will realise that Australia by far is the fairest of them all.

In 1 975, when the Fraser Government came to power, the market share for the Australian garment and textile industry was only about 55 per cent and about 45 per cent was imported. In 1978 the situation is that Australian manufacturers have a 60 per cent share of the home market but we still have the biggest percentage per head of imports in the world. No country has a higher percentage import ratio per head of population than this country has. The United States of America has an 85 per cent market share, the European Economic Community has a 90 per cent market share and Japan, of all places, in the garment area has a 100 per cent market share. Not a single item can be imported in Japan. We have never imposed such restrictions in this country and I do not believe that we should do so.

I believe that we should have due consideration for other nations and also due consideration for the people in this country who want to buy merchandise which is not manufactured in this country. I know the people who were involved in bringing into this country from Israel a well-known international brand of leatherware By Australian standards it was extremely expensive. I was told that, even with the very high duty, there were still people in this country who were quite prepared to expend that amount of money on such goods. Although the goods were not manufactured here, they were prepared to involve themselves in the expense of importing them and paying very high duty. I believe that we should allow this practice to continue. If people are concerned about the price, that is a different matter. We are talking about expensive merchandise which can be produced overseas and which has an international reputation, such as our Australian goods used to have overseas. Unfortunately that ceased to be the case in the latter part of 1 973. Over a number of years I built up a fairly successful export market for Australian manufactured goods garments, children’s wear, men’s wear and textiles. This grew over a period of about eight years. Working through the South Pacific area I gained an understanding of the market and I found that people appreciate high quality garments. Australia has the highest quality in the world of garment manufacture and finish. This is the only country in the world in which even the cheapest garment is overlooked. Very few other countries would expend the money- this is a very expensive part of the merchandise and we spend the extra time in processing a garment to overlock it.

On occasions I have heard an assertion about $4 billion- I do not know the magic formula used- being the cost to the Australian consumer of having protected industries. I do not understand the so-called relevant facts surrounding that assertion. I come back to the very simple principle that, by introducing a bounty of $ 1 . 1 5 per kilogram on yarn produced, we will ensure that Australian expertise is retained, that Australians will maintain their jobs and that other associated industries will have a continuity of supply from an Australian manufacturing house. I believe that that is the crux of the matter. I keep hearing a lot of airy fairy nonsense from people who assert that the end of all our problems will come very swiftly if we introduce free trade. I believe that those people have not had a sufficiently long, hard and sensible look at this matter. If they spent a little time looking at the truth of the situation they would change their minds rather dramatically and in so doing the extremely high unemployment rate, which was caused in the main by some 30,000 to 40,000 people losing their jobs through the decision of the previous Government to reduce tariffs by 25 per cent, would be alleviated.

A lot of people associated with the previous Government had a burning desire at every possible opportunity to put forward their argument as to why Australian industries should not receive any degree of protection, why we should not have any tariffs and why we should not impose quotas. Bounties have just recently been given a half-blessing because some people now realise that they are supposedly identifiable in the actual cost. If the Australian situation is compared with the situation of our trading partners people would be surprised to find out that even our near neighbours who are trying to compete with Australian manufacturers have huge and very restrictive tariff and quota walls. At the same time they are using- I emphasise the word ‘using’- the offshore operation of some Australian manufacturers to gain hard world currency and hard Australian dollars. They are subsidising those manufacturing plants in those countries to ensure that they will be maintained. The situation is that we have a subsidised manufacturer in another country who is trying to supply to Australia. They say: ‘We can produce this item for X number of dollars cheaper than you can in Australia. ‘ People are saying that that is why we should buy from these countries. Those people do not look far enough back to find out the true situation in relation to where the subsidy starts and why in some cases the Australian manufacturer cannot compete.

It is with a great deal of pride that I say that over a period since 1975 we have had a complete change in attitude. The Minister for Business and Consumer Affairs (Mr Fife) who is at the table is partly responsible for that. I congratulate him. I appreciate that he and his Department do not have an easy job. Unfortunately, the issue is not black and white. For the Minister for Defence to make a choice of two or three different aircraft types is fairly easy, but in this area of tariffs, quotas and bounties very difficult decisions have to be made. I am pleased to see that the Bounty (Polyester-Cotton Yarn) Bill 1978 will show the Australian community that the Government understands the problem


-(Hon. Ian Robinson) - Order! I must mention to the House that the clock stopped during the temporary electricity failure. The honourable member’s time has expired although the clock does not show it.

Minister for Business and Consumer Affairs · Farrer · LP

– in reply- This Bill is another job protection measure of which this Government is proud. I am grateful to honourable members who have participated in this debate for the support that they have given. The honourable member for Adelaide (Mr Hurford) who led for the Opposition asked me to respond to two matters. I am pleased to be able to advise him that the present rate is 15 per cent general and Vh. per cent preferential. That was the information he sought. He asked me also about other aspects of the report, particularly the question of long term assistance. I should like to advise the House and the honourable member for Adelaide that aspects of long term assistance are currently under review by the Industries Assistance Commission. I anticipate receiving the report later this year. Once the report is received, naturally it will be considered by the Government and in due course the Government will announce its decisions.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Third Reading

Leave granted for third reading to be moved forthwith.

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

page 526




Debate resumed from 7 March, on motion by Mr Carlton:

That the following Address-in-Reply to the Speech of His Excellency the Governor-General be agreed to:

May it please Your Excellency:

We, the House of Representatives of the Commonwealth of Australia in Parliament assembled, desire to express our loyalty to Our Most Gracious Sovereign, and to thank Your Excellency for the Speech which you have been pleased to address to Parliament.


-Mr Deputy Speaker, I commence my remarks today by asking you to convey to Mr Speaker and to our new Chairman of Committees my congratulations on their appointments. I also take this opportunity to thank the people of the Ballarat electorate for returning me to Parliament to serve them, and the nation, for a further three years. I particularly welcome the chance to serve the new areas of my electorate, the largest of which is the city of Maryborough. I regret however that I no longer represent the seat of Ballaarat spelled with a double ‘A’. The historic spelling of the name was changed along with the redrawing of boundaries. That, I think, is a pity, and I trust that the change will be reversed at the next redistribution.

I extend to the honourable member for Oxley (Mr Hayden) and the honourable member for Kingsford-Smith (Mr Lionel Bowen) my congratulations on their election to their respective positions of Leader and Deputy Leader of the Parliamentary Labor Party. Both gentlemen have heavy tasks ahead of them if they are to remould the Labor Party into an effective opposition again after two disastrous election defeats. I think it is very important that they succeed in these tasks. At a time when democratic institutions around the world, and particularly what should be the most fundamental democratic institution of all, namely Parliament, are coming under increasing pressure, it is vital that we have a strong and effective parliamentary opposition. Other speakers, from both sides of the House, have dwelt on this general issue during our present debate. Several have made positive and thought-provoking suggestions. The contribution by my friend the honourable member for Perth (Mr McLean) in particular deserves careful consideration.

Australia is one of fewer than 20 countries in the entire world which still have democratically elected governments. If we want to preserve our basic democratic freedoms, we are going to have to work for them. We cannot take them for granted, as a God given right. We as a Parliament need to use the next three years wisely, to ensure that we lay the framework for the future prosperous, and compassionate, development of our nation; to ensure that our basic institutions are properly structured to cope with the future requirements that will be asked of them; and to ensure that in coping with the short term problems that will confront us all, we do not lose sight of our longer term objectives.

As members of this Thirty-first Parliament we in this chamber- on both sides of the Houseand our colleagues in another place, have a great responsibility to those who have elected us to office to justify their confidence in us, to convince them that we as parliamentarians are conscious of their needs and are earnest in our desires to meet those needs within the framework of the overall resources of our nation. We need to strengthen Parliament relative to government. Government must be permitted to govern but it must not do this in a way which ignores Parliament and parliamentary processes.

There are many ways in which Parliament should be strengthened. The first, and most essential, is to increase the staff and backup faculties available to members of Parliament. It is quite impossible for members- certainly of this chamber- to carry out all the functions quite rightly expected of them by their constituents, and at the same time to play any worthwhile part in the legislative and policy formulation process, with their existing support staff. The staff increases necessary need not cost the taxpayer additional money, as I believe the problem could, and should, be met by transferring these resources away from Government Departments and towards Parliament.

We need as well to re-think our practices in relation to the handling of legislation through the Parliament. Parliament needs to be involved, I believe, at an earlier stage than is the case now. A major revamping of the committee system is called for. This could be done in various ways. One that appeals to me as worthy of consideration is that followed in the West German Parliament, where legislation initially presented to the Bundestag is presented in draft form. Before further debate, this draft legislation is worked over in detail by small expert committees of members of the Bundestag. These committees can, I understand, co-opt outside advice. This approach strengthens the role of parliament. It brings greater and wider expertise to the legislative process and it is conducive, I believe, to a better spirit of co-operation and bipartisanship between the major parties than is the case in our essentially Westminster system.

We in Australia need a greater bipartisan approach to many of the issues which confront us. No government is always right, and no opposition is always wrong. Other institutional arrangements also are of great importance. In particular, there are those relating to industrial relations and wage fixation. The arbitration and conciliation system which we have in Australia has served us long, and many would say well. But is it, in its present form, still relevant to our present day and age, and to the changes that face us in the future? Is it still desirable to have a body such as the Conciliation and Arbitration Commission so frequently interposed between management and labour as is now the case, or may it not be preferable to have more matters discussed, negotiated and resolved between the two parties directly? I do not know the answer. It obviously is a complex issue and requires careful examination. But at the very least we should be giving thought to the matter.

Similarly, we should be paying more attention to the organisation of trade unions in Australia. At present we have some 300 trade unions. Nations like Germany and Japan, with work forces many times the size of ours, have 25 to 30 trade unions. Whether this has been responsible for the phenomenal economic performance of both these countries since World War II is not fully proven. However, it does seem highly probable, at least in part. I would like to see a strong move towards industry unions in Australia, and a major reduction in the number of unions. This would, I believe, lead to a significant increase in both the quality and the sense of responsibility of union leaders.

I would also like to see legislation introduced to make compulsory a vote of union members before strike action is adopted. To quote West Germany again, not only must any strike there be approved by the union’s executive council, but at least 75 per cent of the members of the union must previously have voted for industrial action in a secret ballot. In taking a decision, the union executive must take into account the business situation of the firm concerned, the general economic situation, and the public’s welfare. A strike must be directed solely against the employer. Strikes in sympathy, or political strikes, are not allowed. Is it Utopian to think of such an institutional arrangement in Australia? Perhaps it is, but if the West Germans can do it, why cannot we? Would it lead to a massive revolt by the union movement in Australia? Perhaps it would, but the fact remains that in West Germany the system works well, and relationships between management and labour are much more cooperative and harmonious than they are in Australia.

We also need a complete revision of our principles and methods of wage fixation. The present inquiry into this matter by the Conciliation and Arbitration Commission will be of vital long term significance for our economic wellbeing, both collectively and individually. I am convinced that the principle of fixing wages primarily in accordance with changes in the cost of living is a bad principle. To give full flow-ons simply builds inflation into our system. The same applies, although to a lesser degree, with partial indexation and partial indexation has the additional fault that it in no way brings or buys industrial peace. If anything, it may do the opposite. Any system of wage fixation which has as its essential principle anything other than wage increases must be based primarily on productivity increases is, to my mind, an unsatisfactory system. It is argued by some that in order to preserve wages equity between different workers in different industries, wages in all industries must move up uniformly. This is a dangerous argument. It ignores the fact that some industries are more productive than others. These industries should therefore be in a position to attract workers and other resources through financial incentive but this will not happen if wages move uniformly throughout all industries, wage uniformity is a major factor inhibiting the most productive and efficient use of our resources and a major cause of inflation.

Another institution which is also in great need of review and improvement is our structure of capital markets. For most of our history successive governments appear to have had a fear of permitting capital markets in Australia to operate on a market oriented basis. Perhaps in no other area is there such a plethora of official controls and intervention. Many of these have grown up piecemeal over the years. The result is a capital market structure which most financial observers would accept as being overly inhibited and inefficient. I fully support calls which have been made from various sources for a national inquiry into capital markets. Such an inquiry would need to review both internal and external considerations. Matters requiring consideration on the internal side include the effect of existing taxation policy, particularly section 26aaa and 26a of the Income Tax Act; the 30/20 rule for insurance companies, and the whole basis of taxation of insurance companies; the special capital market needs of small businesses; stamp duty; the inability to short securities on the Australian stock exchanges in a controlled fashion; and the general regulatory controls exercised by the Reserve Bank over the banking system.

On the external side there is, for example, the inhibiting effect of regulations which exclude a forward market in foreign exchange transactions for capital items and a currency futures market, and the difficulties facing Australian companies in borrowing abroad in Australian dollars. A closely related issue is the method of determining the value of the Australian dollar against other currencies. Our present system of fixing the value of the dollar by administrative fiat on a daily basis using a trade-weighted basket seems to me to run the risk of giving us the worst of all possible worlds. If we are going to have a flexible exchange rate, as seems inevitable given the world in which we currently live, why not let the rate be determined by market forces but subject to Reserve Bank intervention in the market as may be required? This would simply conform with the practice which has long been followed by most other Western nations. Such an approach would, or course, necessitate the development of a proper foreign exchange market. This is something that is long overdue in Australia in any event. We should be moving towards this end now, regardless of the separate issue of exchange rate fixation.

We need as well to be looking at other institutions which have been created in recent years. One that I have particularly in mind is the Prices Justification Tribunal. It is very difficult to find any firm evidence to suggest that the existence of the Tribunal has in any way led to lower prices throughout the community than would otherwise have been the case. On the contrary there are those who claim that its existence has led to higher prices in some areas including, in particular, motor vehicles. The Prices Justification Tribunal is an expensive addition to the bureaucracy of this country which is paid for by taxpayers’ funds. As well, it imposes significant costs on firms appearing before it through the work involved in preparing submissions.

Since its establishment both the previous Labor Government, which was responsible for setting up the Tribunal, and the present Government have reduced in various ways the powers of the Tribunal. There have been several reasons for this, not the least of which was its role in its earlier days in eroding business confidence and profitability and deterring investment, thereby aggravating the unemployment situation. The main reason advanced for retention of the Tribunal is that its very existence’ is conducive to greater harmony in industrial relations. There may well be some substance in this argument, but against this must be weighed the considerable disadvantages to which I have just referred. My own judgment is that these disadvantages will outweigh the one possible advantage, and for this reason I urge the Government to take early action to abolish the Tribunal.

We have seen in recent years a massive growth of government regulation of, and intervention in, the affairs of the private sector. Some of these have been necessary and desirable; others have much more dubious justification. If we are to have a healthy and enterprising private sectorthe sector which provides 75 per cent of all jobs in this nation and the overwhelming proportion of the goods and services we need- it must not be unduly hobbled by government intervention and regulation. It must be permitted to get on with the job of producing, making profits, investing those profits in further developments and providing employment and creating new jobs in a manner compatible with the private sector’s overall responsibility to act responsibly in the interests of the community as a whole. The private sector cannot be totally absolved from all responsibility in this growth of government intervention. Too many industries seem to take the approach of saying ‘hands off’ to government when things are going well for them, but come running to government for assistance or intervention when things are not going well. I urge those industries which adopt this approach to rethink their attitude, otherwise it is quite inevitable that government involvement in their affairs will grow inexorably over time and that would be bad not only for the industries concerned but also for our nation as a whole.

An issue about which we hear much today and which has a relationship to the point I have just been discussing is that of- to use the current jargonstructural adjustment’. This is not something new. Industries in Australia, as in all other countries, have been adjusting to change throughout our history. The best example would undoubtedly be our rural industries, which have been engaged in a continuous adaptation to changed consumer demand, new technology and changing markets. Our manufacturing industries have also undergone considerable changes over the years, for similar reasons. Change is inevitable. We cannot resist it indefinitely. Equally, government has a responsibility to ensure that change does not take place at an unmanageable rate, at a rate which places undue strain on the economy.

This is particularly important in relation to tariff policy, about which I spoke in this House last week and which therefore I will not pursue in any detail today. What we must move towards over time is the situation where a larger proportion of our resources is going into those industries which are best able to compete in our domestic market and /or in world markets. We must encourage and, where necessary, provide incentives to these industries to expand their markets. For many manufacturing industries our home market is too small for optimal efficiency. These industries must therefore look for export markets and the Government must assist them in this regard. I therefore particularly welcome the Government’s proposals for a new export incentive scheme based on providing incentives to firms which get out and seek markets abroad and which increase their exports to those markets. I hope the Government will announce the details of this scheme as soon as possible.

Productivity and specialisation will be the key to our success or failure. In the next decade competition in both the domestic and export markets is likely to become even more intensive as the lower wage countries expand in world trade. If we are to survive this competition we must specialise and we must pull out all the stops on improving our productivity. This in turn, however, raises other issues. If we succeed in raising productivity, will overall demand for the output of our industries, both at home and abroad, be sufficient to absorb the labour that will be released from existing employment as well as to lower the present level of unemployment? I see no overriding reasons why Australia, with sound economic management and with appropriate job training and retraining schemes, cannot lift its rate of economic growth to a level over the years ahead which will permit a significant reduction in our level of unemployment. It will not be easy. It will require considerable initiative by the private sector, and trade unions and considerable support from government.

The answer of course does not lie entirely in our own hands. To a larger extent than many people realise, our future economic prospects will depend increasingly on economic trends in the rest of the world. A protracted period of little growth in international trade could jeopardise the Government’s strategies concerning maintenance of the exchange rate and a lowering of interest rates, and could short-circuit the recovery in the Australian economy which is now clearly emerging.

I have deliberately concentrated today on some of the longer term issues that we need to tackle in the next three years. There are others, high on the list being the great need to reduce the cost of health care in this country. This can be done only by strengthening hospital management, by discouraging doctors from prescribing more and more specialist services and by discouraging people from unnecessarily utilising medical and hospital services.

The health care industry is an industry, despite the special aura that tends to surround it. It should be subject to the same rigorous costbenefit tests that are applied to most other industries. The cost of health care in Australia has risen enormously in recent years. Its growth has been far ahead of the rate of inflation and population growth. Despite the enormous increase in cost, we do not seem to be noticeably any healthier, or to live any longer. We simply cannot afford a continuation of the rate of increase in health costs which we have been experiencing.

I believe it is incumbent upon us all- the government, the Parliament, and the nation- to make sure that we use the next three years wisely. We are on the right track, but I believe much more can be done. As we move towards the 1980s and the latter two decades of this century, we will find a world of change, a world of much greater complexity than we have ever experienced before and a world in which we will need to use all our initiatives, all our thoughts and all our co-operative processes to get us through the period ahead. If we do so, I believe our future will be very bright.


-There seems to be emerging amongst Government supporters a tactic that the simple solution to our economic problems is to keep telling people how much better things are getting and how much they will improve, and that that is all that needs to be done. A little more than two years ago the Liberals came to office with a massive majority, wedded to the philosophy that if inflation could be slashed and public sector spending cut to ribbons, then the private sector would take up that slack and prosperity for all would return. The nation was told over and over again that the fault lay with ‘Labor’s profligate spending’ and if that could be ended and the money thus saved put back into the hands of the taxpayer, then all would be well. World economic conditions, we were told, had nothing to do with the recession that occurred during 1974-75.

The general election of last year was held because the Prime Minister (Mr Malcolm Fraser) was told by his economic advisers, when it looked as if he would be forced to have an election in May of this year, that things would be worse than ever and that he would have great difficulty in convincing the Australian electorate that his economic policies were working. Since the election, we have seen the Press wage a campaign aimed at talking up the economy. One survey after another has been released to prove that people thought things would get better. If anyone, particularly members of the Opposition, suggested that there were a few unanswered questions about where we were going, then they were regarded as something akin to traitors. If there were any faltering in our surge towards the new boom, it was the fault of the Labor Party, the trade unions, the dole bludgers, women who wanted to work, importers, the European Economic Community, Japan and the United States, the lavatory attendant at Parliament House and the Easter Bunny- everyone, it seems, but the Prime Minister and the Liberal-National Country Party coalition.

There has been a slight reduction in the rate of inflation from 13 per cent to 9 per cent; although some of it is undoubtedly due to a slowdown in the overseas rate of inflation. There have been tax cuts, but they have found their way into the pockets of the rich and the well-off. The less affluent section of the community will be clearly worse off after the proposed rises in health fund premiums come into effect. It is interesting to note the about-face by the media which, during the election campaign, headlined the Prime Minister’s claims that a man on $200 a week with a wife and two children would gain $6 a week and which, a few weeks ago when the tax cuts came into effect, provided printed tables showing that the gains would be $3 a week.

Those are the few pluses for the Government. Now let us look at the other side of the coin. The number of unemployed has risen from 265,567 in November 1975 to 445,300 in January 1978, or 7.2 per cent of the work force. The Prime Minister claims that the rate of unemployment will drop from February onwards. Now that the Government has abolished seasonally adjusted figures, the Prime Minister plays a delightful little game. When the number of unemployed rises in December, January and February, he says that it is the fault of the school leavers; when the number drops in March it is because of the Government’s economic policies. Each time the unemployment rate has fallen it has not fallen below its previous pre-Christmas peak, with the result that each year the underlying rate is higher.

An interesting sidelight to the debate about unemployment is that on the one hand Government supporters are claiming that Labor caused unemployment by cutting tariffs by 25 per cent in 1973, and on the other hand the Prime Minister and the Deputy Prime Minister (Mr Anthony) are using the 25 per cent tariff cut as evidence, when arguing with overseas trade delegates, that we are not practising protection. They want the best of both worlds. The reliability of surveys indicating a rise in production can be gauged by the information released last Friday week, which showed that of the 3 1 key indicators in manufactured items for which seasonally adjusted statistics are available, 19 were lower than in January 1 977- and 1977 was one hell of a year.

There is a strange contradiction in our Prime Minister’s free enterprise philosophy. It does not extend to allowing Australia’s industries to compete with overseas industries. In recent months a number of Australian industries have been protected by the most monumentally high tariff walls in our history- tariffs way in excess of those applying in any other country. At the same time, the Prime Minister has the gall to attack the European Economic Community, Japan and the United States for doing the same thing to protect their own producers. I do not intend to get into a discussion about the merit of free trade or protection. I simply illustrate the hypocrisy of accusing other countries of being protectionist when Australia is the arch protectionist of them all.

What fascinates me is that the Government will go to any length to protect industries where it is patently obvious that they have little chance of viability without massive tariff protection, yet it does little or nothing to encourage those industries where growth is guaranteed and where Australia could successfully compete with overseas countries. I refer in particular to the tourist industry, which surely must wonder what it has to do to get any assistance from this Government. It is probably impossible to find an industry which has had such a remarkable growth or such an assured future. The World Tourist Organisation has estimated that world-wide travel expenditure on tourism in 1976 was SUS250 billion. Australia, largely due to the neglect of the Liberals, has slipped behind in the race to acquire its share of the tourist dollar. Expenditure by travellers in the Pacific and South East Asia in 1976 was $US5.8 billion. Australia’s share was less than 10 per cent of that total and less than one per cent of the world total.

The argument against helping the industry is that Australia does not really need to worry about the fact that we have a substantial and growing deficit in tourism because we have a trade surplus in a number of other areas. This attitude, expressed by Treasury officials when giving evidence before the House of Representatives Select Committee on Tourism, seemed to me to ignore the fact that we are having increasing difficulties in selling our traditional products overseas. It also ignores the fact that as the rural, mining and manufacturing sectors become less labour intensive, there is a need to create more and more job opportunities in the service sector. There is also mounting evidence that consumers are opting to spend more and more of their surplus savings on leisure and travel rather than on consumer durables.

Tourism is particularly attractive in coping with unemployment because it is a labourintensive industry. It provides employment directly through accommodation, entertainment, travel agencies and transport operators, and indirectly through retail sales, construction and a myriad of service industries. Women, migrants and the unskilled are the major beneficiaries.

As a large number of our major tourist attractions are well away from the capital cities, few industries can aid decentralisation more than tourism. The industry is a clean one and if carefully planned and organised can be a factor in preserving our heritage and our environment. It is in the industry’s long term interest to see that our heritage, our wildlife, our scenic attractions and our foreshores are not despoiled or polluted either by tourism or any other industry.

The tourist industry has had enormous problems, particularly in defining itself. Because of the wide variety of people who are in one way or the other involved in tourism, it has had a problem in presenting to the Government evidence of its contribution to the economy. Treasury argues that the tourist dollar is merely a transference of a dollar from one part of the nation to another. It may be that some portion of the internal tourist dollar is transferable expenditure, but it ought to be obvious even to biased Treasury officials that the international visitor represents a 100c in the dollar gain to Australia. So also does the Australian who prefers to travel inside his own country rather than travelling overseas.

One of the major tasks now being attempted by the Australian National Travel Association is to provide evidence of the job creating nature of tourism. A simple question which should be asked of the Treasury officials is this: What would happen to hotels, motels, travel agents, tour operators, restaurants, cafes and clubs, civil aviation, shipping, railways, buses, taxis, car hire firms, coach firms, entertainers, sporting facilities and other allied tourist enterprises, including the clothing, footwear, handicraft industries and so on, if tomorrow every Australian decided to stay at home and not to go on vacation for a year? Pigram and Cooper, in their report to the Select Committee, entitled ‘The Economic Significance of Tourism to Australia ‘, had this to say: . . . the Treasury argument fails to appreciate that tourism and travel are often financed from savings that might otherwise remain unspent. In technical terms, tourism, by creating new opportunities to spend, can provide a stimulus to the community’s marginal prosperity to consume, rather than save. This expenditure is not all together a transfer of normal spending patterns, but to a considerable degree reflects the generation of ‘abnormal consumption’ and thus not additional expenditure in the economic system.

In the same paper evidence was presented from Canadian research that tourism creates in that country approximately 320,000 jobs directly and more than half that number again indirectly.

I have been referring only to the economic benefits of tourism, but what of the benefits to the health, welfare and education of our people, not to mention the goodwill and understanding gained from international visitations. The Australian Parliament has been talking about tourism for more than a decade, and during that period, with the exception of the time when the honourable member for Grayndler (Mr Stewart) was the responsible Minister, it has done little or nothing about it. When we were in government the Australian Tourist Commission was at last given a decent budget to promote Australia overseas and to encourage Australians to see their own country first. Funds were made available for the development of tourist attractions such as Sovereign Hill, Old Sydney Town and Lachlan Village, just to mention a few. Things were starting to happen- not enough, I grant you, but at least it was a start after years of talk.

At the time of the 1975 election a then shadow Minister for the Liberal Party, Senator Rae, promised that the Liberals, if elected, would do better. Senator Rae got the sack and the Prime Minister then proceeded to cut back on the little that was being done. None of Senator Rae’s promises were fulfilled. The ATC had its budget slashed and grants to heritage attractions were stopped. The only action taken by the Liberals in the interests of the industry was the setting up of the Select Committee, and that was as a result of some questions I asked the Prime Minister. The establishment of the Committee was a good move, but, in itself, it achieves nothing. The litmus test for the Government will be whether it will act on the Committee’s recommendations. The Committee is an excellent one, with a first class group of members from both sides of the House included in its membership. It is keen; it has worked hard; it is knowledgeable; and I believe it is realistic in that the Committee does not see itself as a fairy godmother to the tourist industry but as a group of politicians who have the vision to see the potential in tourism if a few significant changes are made and the Government indicates that it is taking the industry seriously and will give it a little help and a little encouragement.

Of course, we realise that if we had unlimited funds we could create a boom in industry, but that would be unfair to the taxpayer and unfair to the industry itself. An industry which needs massive government aid does not deserve to survive. The Select Committee made a number of modest recommendations, which I seek leave to have incorporated in Hansard.

Leave granted.

The recommendations read as follows-

page 532


The Committee recommends that:


-I thank the House and the Minister. Of those 17 recommendations, I understand that the Government intends to adopt three- recommendation No. 4 dealing with the registration of travel agents, recommendation No. 8 enabling the provision of small business finance through the Australian Industry Development Corporation to include the tourist industry, and recommendation No. 13 providing for the upgrading of Brisbane Airport. Of the other recommendations, five, in my view, are absolutely essential if the Government is to be taken seriously by the tourist industry, and vice versa.

Recommendation No. 2 provides for a matching $2m grant over two years to the Australian National Travel Association for the promotion of domestic tourism. In simple terms, it would be a joint promotional effort by the Australian Government and the industry to urge Australians to ‘see Australia first’. Recommendation No. 5 will cost the taxpayer nothing to implement. It urges the Government to play a leading role in getting the States and Territories together to ensure that we have staggered school holidays. That does happen to a degree now, but there is still an absurd amount of overlapping which results in the same limited amount of facilities being overtaxed during May, September and January. A little co-operation ought to result in school holidays being spread over the months of April, May and August, September and December, and January and February. The result should be cheaper accommodation for tourists and more profitability for the industry. Recommendation No. 5 highlights the training needs of the tourist industry and the need to upgrade the quality of service.

Recommendation No. 10 deals with an area which the Labor Party feels is essential in the revitalisation of the accommodation sector. Because of quick changes in fashion, hotels, motels and other income producing buildings associated with tourism have a relatively short life- approximately 25 to 40 years- in comparison with office buildings and factories. The hotel which was the height of fashion a few years ago loses its appeal and has to be replaced. To encourage entrepreneurs regularly to update their facilities, thus enabling them to compete with overseas accommodation, the Committee has recommended that the Government introduce a depreciation allowance on tourist buildings.

Recommendation No. 12 deals with regional routes for domestic airlines. In my view, it is an innovation which should cost the Government nothing to implement and which should lead to increased profitability for our own domestic airlines. It could be the great breakthrough that could lead to major development in at least two of Australia’s greatest international attractionsthe Centre and the Great Barrier Reef. The present domestic two airline policy provides for Ansett Airlines of Australia and Trans-Australia Airlines to provide all the interstate civil aviation services. Qantas Airways Limited provides the international services. The result is that Qantas can fly to New Zealand, Noumea, Fiji, New Guinea, Singapore, Bali and so on and can arrange any number of these destinations in a package deal. However, Qantas is prohibited from flying to Alice Springs or to the Great Barrier Reef or to Hobart. On the other hand, the domestic airlines have access to all the internal destinations but cannot fly to any of the countries situated close to Australia.

If, for example, any of the three airlines wanted to package a three week holiday which included Alice Springs, Ayers Rock, Singapore, Bali, New Guinea and the Great Barrier Reef, they would be unable to do so. Similarly, if they wanted a package which included New Zealand, Tasmania, Melbourne and Sydney, that could not be done either. It is quite impossible to have a mix of international and domestic travel. The situation is absolutely absurd. One has to choose between one or the other. When Australians realise that the cost of an economy class air fare from Sydney to Ayers Rock is $252, that the air fare from Sydney to Cairns is $302, and that they can have an eight day package deal to Fiji, including accommodation, for $397 or an eight day package to Noumea for $305, it is not surprising that they choose the more exotic international trip. Even packages to Brampton Island at $391 for eight days are more expensive than the package deals I mentioned earlier. I believe that Australians would jump at the opportunity to include in an overseas trip a visit to some part of Australia that they may not opt to visit on its own.

Another major benefit of regionalising flying for Australia’s airlines would be that gained by international visitors. At the moment if a couple fly into Sydney and want to visit the Barrier Reef they are faced with an extra charge of $600, plus the cost of accommodation, just to get to Cairns. That added burden, on top of an outlay of at least $2,000 to get to Australia, is just too much. How much better it would be if they could transfer at Fiji or Noumea to a smaller jet belonging to TAA or Ansett and fly direct to the Barrier Reef for a few days and then on to Sydney, Canberra, Adelaide, Alice Springs, and then on to

Bali where they could resume their trip by larger jet. It is essential that we implement recommendation No. 12 if we are to reduce the $300m travel gap that exists because Australians prefer to travel outside Australia and if we are to encourage more international visitors to see Australia ‘s greatest tourist attractions.

There are two other particular matters which I want to put to the Government and which have not yet been dealt with by the Committee. If Australia is to develop its major tourist attractions, particularly those for which it is internationally famous, funds must be provided as they are in many other countries to develop selected areas. I speak specifically of the Barrier Reef and Ayers Rock. The establishment of international standard accommodation can be achieved only if governments assist with infrastructure costs. Enormously expensive capital costs are associated with building in these wilderness areas.

The Government has a lot to answer for to the tourist industry for dismantling the plans of the Whitlam Government to develop the Ayers Rock-Mount Olga area. The present situation there is absolutely disgraceful. Superb proposals put forward in 1969 by the consultants Harris, Kerr and Forster were being implemented by the Labor Government in 1975 when the Liberals were returned to office. The proposals were immediately abandoned. Similar proposals were prepared for the Barrier Reef and were promptly pigeon-holed. Australia must do something to upgrade its world class attractions, and this can be done only by government action.

Finally, we must continue to fund a limited number of man-made attractions such as those I mentioned earlier that depict various aspects of Australia’s heritage. I refer to Old Sydney Town, Sovereign Hill, Swan Hill, Lachlan Village, the Western Zoo at Dubbo and a number of others. I am not excluding any on purpose. No doubt honourable members know of many similar attractions. I have not the time to include all of them in my remarks. Time, unfortunately, does not permit me to dwell on many other aspects of tourism that I hope to cover in the future. If this Government is serious about tourism the least it can do is implement the minor proposals I have suggested today. Many of the suggestions would not be expensive to adopt. They simply demand government action and administrative decision. A decision concerning the airlines would cost us nothing at all. Most of the other suggestions could be adopted at minimal cost. We hear a lot of talk about tourism. It is up to the Government to start to take it seriously and do something concrete about it.


-First of all I congratulate you, Mr Deputy Speaker, on your appointment as Chairman of Committees. I would be grateful if you would convey to Mr Speaker my congratulations on his knighthood and on his re-appointment to the chair, a position which he fills with such dignity and impartiality. I also thank the electors of Macarthur for returning me, particularly as the Australian Labor Party candidate opposing me was of very high quality. I must say in all fairness that he is very highly regarded in the electorate. I regret that voters in Campbelltown, Cobbitty and Narellan did not on this occasion have the opportunity to vote in the electorate of Macarthur. They were transferred to the electorate of Werriwa. I hope that at least for some of them the prospect of their returning to the great electorate of Macarthur may emerge in the future.

I also express some concern for the constituents in Macarthur. It would be foolish for any Government supporter to claim that everything in the garden is lovely. I think no Government supporter would be foolish enough to maintain that proposition seriously. What we have been maintaining with some vigour is that now there is a far greater prospect of success and recovery, of full employment, of economic stimulus and of the restoration of the sort of life to which people in Australia were accustomed and the sort of confidence with which they could look forward to the future. I believe that the restoration of these things is far more likely than it could ever have been had the Labor Government continued in office or had this Government’s term been cut short at the last election.

The areas in respect of which I certainly have a great deal of concern for my electorate in particular are fairly widespread. I am very concerned about the future of the miners who live and work in my electorate. I am concerned because the New South Wales Government is introducing legislation which is placing in jeopardy hundreds of jobs in the mining industry in my electorate. This is occurring because of the State Government’s attitude to the mining of coal under stored waters. Its attitude appears to be a rejection entirely of a finding by an expert committee which examined this matter that no real risk was involved in mining under stored waters provided proper safeguards were maintained. The State Government’s decision, as is evidenced by the introduction of a Bill in the State House last Thursday, is a disastrous one for a large number of my constituents.

I am also concerned about the impact of the decision of the European Economic Community to take a very strong line about imports of Australian steel. It was bad enough for the coal miners in my electorate that the steel industry around the world was in such a disastrous state and that exports of coal were diminishing, but now that exports of steel from Australia are also under pressure it means that many of the mines which had assured, guaranteed outlets of coal to the plant of Australian Iron and Steel Pty Ltd at Port Kembla are now facing a very worrying time. They have large stockpiles. The protectionist self-interested attacks of the Europeans on our exports could bring serious problems regarding the employment of miners in my electorate. I hope that the Government will take a positive stand and do what it can to ensure that this highly skilled and competent work force in the South Coast mines of New South Wales will be retained and will continue to produce coal. The future of the industry is assured provided it can overcome its temporary problems.

I am concerned about the paper mill workers in my electorate who are dependent on what one could almost call the whims of the Industries Assistance Commission. The paper industry is a major industry and a major employer in my electorate. I hope and feel sure that the Government will be adopting a most sympathetic attitude to the interests of paper mill workers in Australia in general and in the Shoalhaven area in particular.

There are many pensioners in my electorate. I hope that the Government will be taking a serious look at some of the unfortunate consequences of the Labor Government’s antipensioner legislation which still persists despite the reform which has taken place under the present Government. That reform, of course, relates to the increase in the tax-free zone that now removes so many pensioners from taxation liability. This taxation was imposed on pensioners for the first time by the so-called reforms of the Hayden Budget. Superannuitants had to pay tax. This Government has removed almost a quarter of a million of them from that category. I still believe that there is a great deal of scope for this Government to provide further relief to superannuitants particularly by way of fringe benefits. The Government’s failure to recognise the significance of the cut-off level for the pensioner medical card, for example, strikes me as unfortunate. I hope it will fix up that situation.

I am concerned about the dairy farmers in my electorate who have suffered severely from the unfair activity of the New South Wales Government which removed, without compensation, dairy farmers quotas. I welcome the continuation of the Federal Government’s support schemes to assist the manufacturing milk section of that industry. If the Government in New South Wales had the same sympathetic understanding of the pressures on the requirements of the milk industry in that State I am certain that a large section of my electorate would be facing a far more happy future. Beef producers, I am afraid, may well not be facing in the immediate future a good time at all. It appears to me that non-American markets for Australian beef are drying up. It also seems very likely that a large number of Australian meat exporters are fast running out of their United States quota. It could well be that unless the Government provides greater assistance to help corporations and exporters to develop new markets, the beef producer may be looking at the wrong end of a price situation.

It is the taxation situation, particularly as it affects primary producers, that worries me most. The difficult period through which so many primary producers have passed in recent years has resulted in many of them incurring serious losses. These losses have accumulated. As honourable members know, if one suffers a loss, one has the right to carry that loss forward to the next year’s income and to the income for the year after that if the income in the first year is not enough to offset those losses. The principle is simple and quite proper. It is a serious burden for a farming family to have to go into debt as a result of incurring the losses which are now so universal throughout the rural sector. The changes in the tax laws which were implemented during the period when the present Leader of the Opposition (Mr Hayden) was Treasurer of the Labor Government had a serious impact on the capacity of farmers to obtain a benefit from those carried forward losses. Whilst some of the measures that this Government has taken have greatly benefited many taxpayers, I submit that they have effectively worsened the relative position of farmers who have accumulated losses.

There is no doubt that a farmer or small businessman with accumulated losses has been disadvantaged severely by the changeover from a deduction to a rebate system for concessional expenditures through being unable to derive a full tax saving from both his accumulated losses and his concessional expenditures. For example, let us consider the case of a farmer who is carrying forward losses amounting to $12,000 and who has an income in both the current year and the following year of $10,000. Let us assume that he has no dependants and has concessional expenditures such as life assurance, medical costs, land rates and so on amounting to $ 1,500. Under the pre-Hayden tax scale and deduction system, he would have been regarded as having no taxable income in the current year and therefore would not have to pay any tax but he would have been regarded as having a taxable income of $5,000 in the subsequent year and would have to pay a tax bill of $680. Under the 1977-78 tax system, in the current year he would have no tax to pay, as was the case under the old system, but in the following year his tax would be $1,410 instead of $680. No rebate would be available because his concessional exenditures did not exceed $1,590 a year. Hence, under the new system he would pay $730 more in tax in the second year. This has been brought about as a result of the improvements in the tax system. Mr Deputy Speaker, I seek leave to have incorporated in Hansard a table prepared for me by the Parliamentary Library.

Leave granted.

The table read as follows-


-I thank the House. The problem arises basically because the deductions for concessional expenditures up to $1,590 were replaced in 1975-76 by a general rebate available to all taxpayers regardless of whether they incurred the itemised expenditures. However, the inclusion of accumulated losses in this situation has added a new dimension to the problem. The changeover to the new system has increased the tax burden significantly, particularly for primary producers and small businessmen, who incur both losses and concessional expenditures. I urge the Government to change this situation, which has been worsened by the introduction of the very large tax free zone. It means that accumulated losses are now being applied against income which does not attract tax anyway instead of against taxable income. If equity is to be provided to the many farmers I know who have suffered severe losses, I suggest that that kind of system should be changed. It is clearly inequitable. It is clearly wrong. Many farmers in my electorate will suffer as a result of this change, which clearly benefits so many taxpayers but which disadvantages so many farmers at a time when farmers are suffering severely for other reasons.

Sitting suspended from 6 to 8 p.m.


– Prior to the suspension of the sitting I was lamenting the fact that the changes in the taxation structure were having a seriously disadvantageous impact, particularly on farmers who had accumulated tax losses. I was stressing that it was grossly unfair that those people who are in the worst possible position should be treated so unreasonably as a result of gains by other groups in the tax structure. I earnestly hope- I stress this- that the Federal Government will recognise this serious disadvantage to many farmers in my electorate, to farmers throughout Australia and to small businessmen.

I refer to another group in the tax structure which I think is grossly disadvantaged. I refer to a situation that has emerged as a result of the Federal Government’s proper decision to remove death and gift duties. The consequence of this decision is serious in its impact on people who have endeavoured to make arrangements to minimise the payment of death duty by taking advantage of arrangements called Gorton arrangements. There is no doubt now that there is a serious risk of many farmers and family business people being in a situation where they will be seriously disadvantaged financially as a result of those arrangements and the curious approach by the Taxation Commissioner, although these duties are now being removed. I earnestly seek the Government’s support for the proposition that all people who have come to Gorton-style arrangements should be allowed to undo them and face whatever tax disadvantages emerge from that undoing. The reason I put this proposition to the Government is that it is totally inequitable for the present situation to continue when the Government has now determined that death and gift duties should be removed, and in fact have been removed in regard to estates passing between parent and child and husband and wife as at 2 1 November last.

If it is acceptable to the Government that people in those categories should no longer be hit with death and gift duties it is equitable that people who are still alive and who came to arrangements to avoid the payment of these duties should now be able to undo those arrangements without suffering the specific and vicious disadvantage being imposed upon them, I submit, by the Taxation Commissioner. I think there is justice and propriety in my suggested course of action. I am not suggesting that the Taxation Commissioner should be asked not to proceed in the current case in which people are rightly appealing against court judgments in support of the Commissioner’s contention. It would be improper to tell the Commissioner what to do. All we have to do in equity is to allow those arrangements to be undone.

An immense amount of time has elapsed since the original Gorton decision in the High Court. Eight years ensued between the decision in Gorton ‘s case and the decision in a subsequent case in the High Court, during which time many thousands of people relied on the original Gorton decision to come to these taxation arrangements. The High Court decision which put these propositions at risk was made by an evenly divided full High Court. My view is that that decision was incorrect. The fact was that it was clearly against all established commercial practice and was certainly contrary to common sense. Something like $500m of gift duty assessments is in question. Imagine the hardship that the collection of this amount of money would involve on people who are still alive, who had they not entered into this kind of agreement would not have been subject to estate duty, but who because they entered into these agreements must pay estate duty. The impact of this kind of situation on many farms and small businesses would clearly render a large proportion of them bankrupt. I believe that it would be totally improper for the Government to pursue this matter.

I think there is an unfairness in the issue of the assessments and in the interest penalty of 10 per cent. This situation has existed for years and years, with uncertainty. The one thing that the Taxation Commissioner has an obligation to provide for the people of Australia is certainty. One must know whether the arrangements one is making are acceptable. The Commissioner did nothing for eight years, in effect, while allowing these schemes to proceed- schemes the merit and justice of which are such that the Government has removed the liability for the payment involved as at 2 1 November. I think the Government has an immediate obligation to do something about this situation. So, Mr Deputy Speaker -

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


-Mr Deputy Speaker, I speak to the House tonight as the member for Grayndler after having spoken to the House on numerous occasions during 24 years and three months as the member for Lang.

I regret the abolition of the division of Lang, which was an original electorate at Federation. Why Lang was abolished can be known only by the Distribution Commissioners. Not only was I but also a lot of other people were amazed at its abolition and at the drastic changes made in the boundaries of the proposed seats of Lowe, Sydney and Grayndler after objections to the original proposals. It is reasonable to assume that if this Government can interfere with, alter and cancel a recommendation of an independent stores and tender board in the case of a computer tender pressures on Distribution Commissioners by people in this Government can have the desired effect in having boundaries changed to suit an individual or individuals.

In my 24 years as the Member for Lang I faced

I I elections. I commend and thank the electors of Lang for their intelligence and good judgment in returning me as their member on each occasion. I made many friends and had a large number of firm and loyal supporters in the abolished Lang electorate. I place on record my thanks and appreciation for their support, assistance and advice during those 24 years.

The new seat of Grayndler contains 49 per cent of the abolished seat of Evans, 16 per cent of the old Grayndler, 4 per cent of the old Blaxland and 31 per cent of the abolished seat of Lang. Therefore, for the 1977 election I took over 69 per cent of electors that were new to me. It was with some trepidation that I faced election for the twelfth time. My fears were unfounded. The people in the new electorate of Grayndler possess the same sound judgment as did those in the old electorate of Lang. The swing to the Labor Party in the seat of Grayndler registered 4.1 per cent. It was the highest swing to Labor in the State of New South Wales and the second highest in Australia. I thank those new people whom I inherited from the seats of Grayndler, Evans and Blaxland for their support and their confidence. I promise to serve them faithfully and well throughout my term as the member for Grayndler. If it is possible I will try to serve them even better than they were served by my predecessors Fred Daly and Tony Whitlam.

The electorate of Grayndler has a large number of problems. A large proportion of the population in the electorate of Grayndler comes from other countries. Amongst those people there is a high rate of unemployment. They have their housing difficulties; there is the language barrier; there is the overcrowding in schools within the area; and, above all, there is an insufficiency of English or second-language teachers in all those schools. Some of the schools in the electorate of Grayndler have 43 different nationalities amongst the pupils and, because this Government fails to make available sufficient funds for education, those young boys and girls are unable to get a basic education in English. These are some of the topics that I will have to devote myself to in the life of this Parliament. I promise my constituents in Grayndler that I will do exactly that. I know that the job is in front of me and all members of the Opposition. The policies enunciated in the GovernorGeneral’s address to the Parliament give no hope, no consolation, to any person who wants to lift this country of ours out of” the mire into which it has fallen deeper and deeper in the last couple of years. The policies enunciated on behalf of the Government by the Governor-General are unimaginative. They offer no hope for our unemployed, for our manufacturing industries or the health system throughout Australia. Virtually stay-put policies have been enunciated by this Government. So the job is in front of the Opposition in highlighting the continuing failures of this Government to do anything about unemployment and inflation.

During this debate on the motion for the adoption of the Address-in-Reply many honourable members have commented on the tourist industry, and I want to deal with that topic. You, Mr Deputy Speaker, will recall that I was the Minister for Tourism and Recreation from 1972 to 1975 and I was the Deputy Chairman of the House of Representatives Select Committee on Tourism which was appointed in December 1976 and which tabled an interim report in November 1977. That Select Committee has been re-established and the Labor Party has seen fit to elect me again as one of its representatives on that Committee. To my mind the tourist industry has been and is still the most neglected industry in Australia, yet it is an industry which has been described by people who are not prone to giving compliments- such as those on the Industries Assistance Commission- as a relatively efficient industry with sound long term prospects. Very few in the community apart from those engaged in the tourist industry appreciate the tangible and intangible benefits of the tourist industry. That statement applies in particular to many Ministers in this Government as well as many in the previous Labor Administration. It also applies to many of our top public servants, particularly those in a position to give the Government advice on finance and industry matters.

The tourism committee had prepared for it a report by Dr John Pigram and Dr Malcolm Cooper of the Geography Department of the University of New England. The report is entitled ‘Economic Significance of Tourism to Australia’. Pigram and Cooper admit that there is a lack of statistics and indicators on the subject and therefore they were most cautious in their estimates of the economic significance of tourism to Australia. The report is now a public document and I challenge anybody in the community, particularly the Treasurer (Mr Howard) and the Minister for Finance (Mr Eric Robinson), to prove the estimates by Pigram and Cooper incorrect. The Chairman of the Select Committee on Tourism, the former honourable member for Herbert (Mr Bonnett), in tabling the report of the Committee on 3 November 1 977 said:

It was estimated that the contribution of tourism to gross domestic product in 1 974-75 was $3,300m.

I interpolate to say that that is about 5.5 per cent of the gross domestic product. Mr Bonnett went on to say:

In 1974-75, governments are estimated to have gained $172m in indirect tax, $ 165m in company tax and $355m in income tax.

I again interpolate to say that those estimates of tax from the tourist industry represent 4.9 per cent of the total company tax received, 4.3 per cent in indirect tax and 4.6 per cent of the total income tax that was received. Mr Bonnett went on to say:

The advisers also estimated the multiplier effects of tourism. For every dollar generated by tourism a further 25c is generated in the rest of the economy. Similarly for every two direct jobs in tourism one further job is created and an increase in tourism turnover of $ 1 0,000 creates 1 .2 1 jobs.

It was estimated by the advisers that tourism provided direct fulltime employment for 263,000 persons and indirect employment for 136,760 persons. Tourism also makes a significant contribution to Australia’s balance of payments as well as increasing the community’s knowledge of Australia and the Australian heritage.

The advisers considered a number of definitions of what is the tourist industry and what is a tourist, and in the report which I have mentioned on page 7 they say:

This report recommends that, conceptually, tourists be defined simply as:

All short-term visitors into an area for any purpose- other than to commute to work, or for purely local travel within the home community, or as travellers in transit.

By accepting that definition it can be argued that 26 prime industries may be identified as benefiting directly or indirectly through investment from tourism in Australia. The report lists some of those industries under these groups: Finance, entertainment, retail, community services and transport. The finance group includes savings banks for personal loans for travel and for the issue of travellers cheques. Industries in the entertainment group include zoos and theme parks, cafes and restaurants, licensed motels, sport and recreation facilities. The retail group includes supermarkets, service stations, motor boats, outboard motors, caravans and tents. The transport group includes buses and trains, road passenger vehicles, railways, ships, air transport and other services. I seek leave to have this extract from pages 1 1 and 12 of the report incorporated in Hansard. I obtained the permission of the Minister who was previously at the table to do so.

Leave granted.

The extract read as follows-


– Many people in the community do not realise the potential benefits of tourism coming under those headings. Tourism makes a contribution to our balance of payments position, to our general economic development, to employment opportunities, to decentralised development, to the community wellbeing and to the extension of the education process and other social benefits. We find that 1.6 per cent of fixed capital expenditure is invested in tourist activities, 10 per cent in manufacturing, 4.8 per cent in mining and 2.4 per cent in agriculture.

Many honourable members have spoken about penalty rates and their effect on employment in the tourist industry. Let me quote a few statistics from page 36 of the Pigram and Cooper report. In the tourist industry $ 1 ,0 1 3m, or 2.9 per cent of the Australian total wages and salaries bill, was spent on wages and salaries, compared with 24 per cent for the manufacturing industry. In the tourist industry the penalty rate paid to males is $15.24 and to females $4.27, compared with $16.03 paid to males and $3.07 to females in the manufacturing industry. If we look at the average wage, including penalties, we find that a male in the tourist industry receives $146.93, compared with $149.40 in the manufacturing industry. A female in the tourist industry is paid $ 1 1 7.67, compared with $ 1 10 in the manufacturing industry.

Mr Cohen:

– For what year was that?


-That was for 1974-75. They are the latest statistical figures that are available. People talk about extravagant payments of penalty rates and wages in the tourist industry but they should look at the facts. They say that the tourist industry is a 7-days a week industry and therefore there should be a loading on a base wage which extends over the seven days of the week. I ask those who espouse that argument to give me the cut-off point, to tell me how far that goes. Would they refuse to pay penalty rates in hotels and motels? Would they refuse to pay them in cafes, restaurants and night clubs?

Would they refuse to pay them to coach drivers, airline pilots and employees of the airlines and railways? Wages in the tourist industry are no greater than wages paid in any other industry in Australia.

Mr Giles:

– Absolute nonsense!


– I quoted the figures and I will mention the hours worked. In the tourist industry the average hours worked on ordinary time are 39.5 and 3.3 hours on overtime, making a total for the week of 42.7 hours. In the manufacturing industry 38.9 hours are worked on ordinary time and 3. 1 hours on overtime, making a total of 42 hours worked. I seek leave to have page 36 of the report incorporated in Hansard so that the honourable member for Wakefield (Mr Giles) can be brought up to date.

Leave granted.

The document read as follows-


– I would like to refer to a lot of other points because I have found that reports tabled in the Parliament, particularly those that were tabled at the time this one was tabled, are not read by honourable members. They are not read by the top public servants. Honourable members come into the House and shoot their mouths off without knowing the facts. The honourable member for Wakefield is not the only honourable member who is guilty of that. Australia is suffering from a high rate of unemployment. The tourist industry is predominantly Australian owned and Australian controlled. Therefore it should be encouraged by this Government and by the State governments. At least the State governments are trying to do something. This Government neglected the tourist industry up until 1 972-

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


-Mr Deputy Speaker, firstly I ask you to convey my congratulations to Mr Speaker on his re-election to that high office. I also congratulate you on your election as Chairman of Committees. I ask you also to pass on my congratulations to the Deputy Chairman of Committees. I pay tribute to the Clerk of the House and to those who assist him in his work. All these people contribute to the effective operation and workings of this Parliament. However, I emphasise that, in order to fulfil their duties and responsibilities, better accommodation must be provided for members of parliament. The accommodation which has been provided is not good enough. It has been my unpleasant duty as the National Country Party Whip to allocate to honourable members of my party rooms which are below standard in size and in other respects. I know that this matter is receiving the attention of those responsible and I wish them well in their endeavours. It is certainly something that is necessary if we expect the best results from the people who represent the Australian community in this House. More and more honourable members are bringing staff to Parliament. They require rooms and honourable members need to have room in their offices so that they can work effectively there.

As I see it, one of the most vital needs of the nation is effective and economic communications. Many people living in sparsely settled areas suffer quite severely from the lack of frequency in postal services and from the high costs of installation of telephones in the first instance and in the cost of telephone communications generally. This is because of the high percentage of trunk line calls that have to be made so that they can conduct their business effectively. In the course of this speech I will mention some of the other problems faced by people in those isolated areas. I make no apology for doing that, because those people are represented by only a comparatively small number of members in this House. Those of us who represent those people have to take the opportunity when speaking in debates to draw attention to the problems that exist in those areas, whilst not neglecting the needs, and difficulties of, and the progressive measures that are needed for, the community as a whole.

I turn now to postal services. It is my very strong conviction that where postal services can be provided they should be provided at a frequency of not less than twice weekly. Quite often this minimum requirement cannot be met by the

Australian Postal Commission under the criteria with which it has to conform. Whilst we recognise the need for the economic operation of government departments and commissions, such as the Postal Commission and the Telecommunications Commission, it must be remembered that the Postal Commission should provide a minimum service even if that service has to be provided at some cost to the community. I have taken up with the Minister for Post and Telecommunications (Mr Staley) the suggestion that even if a twice weekly postal service is outside the financial criteria of” the Postal Commission it should be provided, and the difference between the amount allowed to the Postal Commission and the cost of providing the service should be made available by the Government to the Postal Commission. This would mean that in providing such an essential service, which the national need justifies, the balance sheet of the Postal Commission would not be affected adversely.

I turn now to telecommunications. The cost of installing telephones for individual subscribers in outlying areas can be and often is prohibitive. Once again, the need for a high standard national communications service should be given the consideration that it deserves. I believe we all agree that the progress the Telecommunications Commission is making in the development of automatic telephone services is very desirable; but to have automatic telephone services one has to have a high standard of telephone line with which to be connected to those services. There are examples of people who have telephone lines which are suitable, if not fully effective, for manual exchanges but which, although the people have not asked for this service to be provided, have to be changed in order to conform with the requirements of automatic exchanges. These people have to incur very great costs in upgrading their lines in order to meet those conditions.

I believe that in this area there should be a reasonable maximum charge. I believe that that charge should be spread over a longer period than it is at the present time. It could be spread over, say, 10 years in order to alleviate the heavy burden of meeting the capital cost of that connection. In some cases it is beyond the financial capacity of people to provide telephones for themselves. I once spoke about this matter to a Postmaster-General in a previous government. He said: ‘I realise that there is a social problem. People who are living far away from medical and professional services, particularly medical services, and who are without a telephone are indeed very isolated’. There are cases in which very serious illness has resulted from such isolation because a telephone was not available. There is no advantage in having a very high class ambulance service if one cannot call on it when the need arises.

I deal now with another matter which concerns telephone services, which I have advocated and on which I hope to receive the support of every honourable member in this House when they consider the justice of the claim. Every telephone subscriber should have a local access call to the nearest main business centre. I define ‘main business centre’ as a town which has medical and other professional services available. I ask the Minister for Post and TelecommunicationsI will ask him again by another means if he is not able to answer now- to provide me with the cost to the Telecommunications Commission of providing this very justified benefit. When I say that it is justified, I really mean that, because it is an advantage that is enjoyed by the great majority of Australians today. The problems faced by the people who are suffering in the sparsely populated areas should be alleviated to that extent.

I should like to touch on a few other matters. I welcome the pending introduction of the Australian Rural Bank. The major benefit it will provide will be long term loans, thereby reducing the annual cost of redemption of loans. I believe that the establishment of such a bank is a step in the right direction. There may be some other aspects of the Bank’s activities that will need changing as time goes on. I strongly recommend that people use it and take advantage of it. If we find that there are problems in the operation of the Rural Bank- for example, if money is not being provided or if it is not going to the right people under the conditions on which the Rural Bank is brought into being- then I, for one, will be looking to see that the position is changed. A responsibility will rest on the banks which will be operating in conjunction with the Rural Bank and which will be recommending loans to see that the objective of the Rural Bank is realised. If that does not occur, then the objective will have to be realised in some other way. But, at the present time, the banks will have that responsibility and I feel that they will be able to cope with it.

I should like to deal with another aspect of this question about which there is some division of opinion. I am of the opinion that the interest charged by the Rural Bank should be at a specified rate below the existing commercial rates of interest. That situation should continue until the interest rates overall reach a figure that is more capable to being handled by our primary producers; for example, when the figure gets down to, say, 7 per cent. From then on, primary producers might be able to cope with the commercial rates of interest, if they have decreased. I know the arguments against this proposal only too well- I have heard them quite often- but I strongly suggest that the difficulties faced by most rural industries, particularly in recent years, are full justification for a modest concessional rate of interest.

I hope that the Government will give consideration to that factor. It will be very difficult indeed for many hard working primary producers to regain viability unless some concessions are made- concessions such as interest rates, which I have mentioned. We have often heard the adage ‘a fair day’s work for a fair day’s pay’. In asking for these concessions tonight I am simply reversing this adage and asking for a fair day’s pay for a fair day’s work. We will be moving towards that to some extent if those costs that have to be met now can be decreased. It is well known that a large number of primary producers are receiving intolerably low net incomes at the present time.

The cost of transport is a matter of very deep concern because it plays an important part in the rising costs of production. The re-introduction of the fuel price equalisation scheme is vital if we are to offset these costs to some extent. I commend the Government on the action that it is taking in this matter. I remind the House and the people of this nation that it was a Labor government which deprived the people of Australia of the advantages of a fuel price equalisation scheme which could have been so beneficial to them during these years of low prices. Those Labor Party members who represent rural areas must feel this way, even if they do not say it. In any case, the fuel price equalisation scheme was designed to offset some of the problems, the difficulties and the costs faced by people living in outlying areas. Honourable members should remember also that it was not a benefit purely to the primary producers; it was a benefit to all those people who live in outlying areas, whatever their occupation. The benefit was spread across the board. The scheme enabled people to live in those areas without having to meet those extra costs.

Mr MacKenzie:

– It helped the tourists, too.


– It helped the tourists as well, as my honourable friend from Calare said. It helped everybody because people could travel through those outlying areas and even middle areas without having to pay the high prices for petrol that they now have to pay. The scheme which is proposed at the present time will subsidise the country freight differential to the extent that country consumers of products covered by the scheme will pay a price which includes a freight differential of no more than about one cent a litre. The scheme will operate by means of grants made by the Commonwealth to the States pursuant to section 96 of the Constitution. These grants will be in amounts equal to the moneys expended by the States in subsidising the sales of eligible products by oil companies and other registered distributors, provided such payments are made in accordance with legal schemes formulated under legislation to be introduced by the Minister for Business and Consumer Affairs. These legal schemes will set out formally the respective roles of the Commonwealth and the various States in the implementation of subsidy arrangements and will detail the relevant administrative procedures. That is the basis of the scheme which is being introduced. The second stage of the proposals by the Government to reduce the difference to not more than 0.5c a litre will benefit a much greater area and will be, of course, of substantially greater benefit to outlying areas. I look forward to the introduction of the benefits to be provided for in the second stage. The first stage of the Government’s proposals will be implemented in the near future. I strongly recommend that the second stage of the Government’s proposals be brought forward and implemented as soon as practicable.

Another matter that I want to raise tonight is the inequity of the burden of local authority rates. These charges have become increasingly difficult to meet where the profitability of industry is low or non-existent. Unfortunately, those areas are not hard to find today. I therefore strongly recommend that the Stuckey report brought down by the Australian Council of Local Government Associations, which advocates that 5 per cent of personal income tax be made available to local authorities, should be accepted by the Government. I commend the Government for introducing the principle of allowing a percentage of personal income tax to go to local authorities. I commend the Government for its intention to increase the figure to 2 per cent during the life of this Parliament. Whilst I concede that the expenditure of a government must be controlled, I still believe that the rate of progress towards achieving a figure of 5 per cent, which I believe is necessary and desirable, should be increased. Again I urge the Government to give consideration to looking at the percentage of income tax made available to local authorities. I repeat that where profitability is low or nonexistent the burden of rates is very heavy. Surely the Government, as the representative of the people of this nation, should look at ways and means of providing funds for necessary and essential services in the most equitable way. If the people in country areas have a good season and receive good prices they will make a fair and reasonable contribution. I repeat that there is a need to spread the burden of local authority expenditure amongst those people in the community who are best able to bear that burden.

I wish to mention the great advantage of the removal of death duties to many people, including the families of those people who will be leaving estates to their families. Only recently I received a letter from a person who was left an estate before the Queensland Government led the way and abolished death duties. That person had to pay both State and Federal duties on that. It was a property which was showing very little profit but which still had a high capital value. It was still hightly valued for the purposes of estate duty. The woman concerned was billed to the extent of $85,000. She will never be able to pay that amount. She was made bankrupt. There are very many instances of this occurring. There was a similar case recently. An attempt has been made to obtain a little more time to allow the debt to be paid.

I welcome the Government’s decision to appropriate funds for decentralisation projects. The Summit Co-operative Fruitgrowers Association in the Stanthorpe district of the electorate of Maranoa, about which honourable members have heard before, has already made an application for funds to assist in financing the establishment of a fruit juice processing plant. The value of establishing such a plant in the granite belt of Queensland is not only in the work it provides but also because hailstorms are quite prevalent in that area. During some seasons they have affected large amounts of fruit, as they have done this year, making it unsuitable for the fresh fruit market. That fruit is still quite suitable for juice processing. At the present time there is quite a keen demand for fruit juice. The cooperative already has markets for some of the fruit juice that it will be processing. I am confident that the project will be very successful. The Summit Co-operative Fruitgrowers Association has had extensive experience in handling fruit and has been a successful association through the years. This is one way in which we can move effectively towards decentralisation. I warmly commend the Government for taking that action.

I shall say a few words about the rate of unemployment so that I will not be accused of having a one-sided view of life in general in this nation. I am concerned about the rate of unemployment and I think every effort should be made to reduce it. In that connection, I would like the Government to look very carefully at the existing apprenticeship conditions with the object of further encouraging employers to engage apprentices. It has been claimed that the conditions which attach to employing apprentices make it uneconomic for them to be employed. If that is so, and some employers have made that claim to me, it is necessary that alterations be made to make it economical for those employers who wish to do so to engage apprentices. They should be encouraged in that way. Some of the problems I have mentioned and some of the remedies I have mentioned apply to people in outlying areas. I say again that I make no apology for that. I remind those people who criticise them that a responsibility rests upon the shoulders of every person in this nation to see that the full productive capacity of the nation is utilised. The gratitude of the Australian community is surely due to those people who are prepared to accept that responsibility in areas where conditions of life are not easy and where there are no medical, educational or cultural advantages available to them. We should be prepared to do something to assist them in the national effort that they are making.

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


-Firstly, Mr Deputy Speaker, I congratulate you on again being appointed a Deputy Chairman of Committees. I would like you to convey to the Chairman of Committees and to the Speaker my congratulations upon their attainment of their high offices. I also congratulate the new honourable members who were elected to this House last December. The new honourable members on this side of the House have made a great contribution to the Parliament already and I am sure they will be a great adjunct to the Opposition and a thorn in the side of the Government.

I also convey my thanks to the people of the electorate of Grey for returning me to this place. It was not a very easy job. As honourable members know, there was a redistribution of the boundaries of the electorate. All the predictions were that the redistribution of the seat of Grey had changed it from being a marginal Labor seat to a marginal Liberal seat. I needed to increase my vote by 3 per cent to hold the seat. I was able to do that. Despite the predictions by the commentators on polling night, I was able to battle it out and return to this place again. Despite the changing of the boundaries of the electorate I was successful. Despite the fact that there was a very large election campaign in which money seemed to be no object to both the Liberal Party of Australia candidate and the National Country Party candidate, I was successful. The other candidates were able to spend money in the campaign that I had no possible hope of matching. I reflect on the comments that have been made here on a number of occasions about the Australian Labor Party suffering a crushing defeat. It is good to look at the figures. The Liberal Party can rule in this House in its own right at the present time. It received 39 per cent of the votes. The Labor Party, which received more of the overall percentage of the votes, has only 38 seats. Honourable members can see that there are some faults in our electoral system.

I refer to the Governor-General’s Speech, which is an outline of the Government’s policy for the next three years. I do not mean this as any reflection on the Governor-General himself, but one wonders what those promises in that Speech will mean and how many of them will be broken. We have to go back only to the promises made during the 1975 general election campaign and to events since then to find out how many promises were broken subsequently. For example, it was promised that Medibank would not be interfered with. That has been emasculated and could be emasculated even further. Similarly, indexation was to be maintained, but it has just about been emasculated; home mortgage as a tax deduction was to remain but that, too, has been emasculated and now applies only to the first five years of the mortgage. As I said, one wonders how many promises contained in the GovernorGeneral ‘s Speech will be broken by this Government in the years to come.

At the present time the Grey electorate faces a number of pretty severe problems. I know that many of those problems such as youth unemployment are similar to those found in other electorates. Two problems stand out. One is the drought that has hit the rural areas. This is the third year in a row in which most of the Eyre Peninsula has been affected by drought. Those areas that have not been affected by drought have been affected by problems of rust and other things. Generally speaking, this is the third bad year, with possibly only about 20 per cent of the area producing much at all. The second main problem that has arisen during the last few months is the closure of the Whyalla shipyards. I shall elaborate on that problem a little later.

Getting back to the problems of the people in the rural areas, because of the low rainfall during the last three years, many of the farmers, particularly the younger farmers, and the people who do not have reserves behind them are almost at the end of their tether. I have spoken to quite a few of those people. In one town I spoke to three people who said to me: ‘Well, this is our third bad year. We have a bill for superphosphate to pay and we have a bill for fuel to pay. We haven’t got the money to pay them. What will happen to us?’ We know of the Government’s proposal to introduce the Australian Rural Bank. I am afraid that this bank will not be able to help many of those people because many of them have reached the limit of their borrowing capacity and to borrow further would put them only deeper in debt. So one wonders what the future will hold for these people in the areas where the drought has had the greatest effect. We know that the Federal and State governments are providing some assistance to these areas. Whilst it will not solve all the problems, it will provide some assistance.

A few weeks ago the Leader of the Opposition (Mr Hayden) expressed a desire to look at some of the drought areas. I had the pleasure of accompanying him to parts of Eyre Peninsula in South Australia. He had a good look at the situation. He was able to speak to quite a number of the farmers in the area. They were quite pleased that he should come to see them and their problems first hand. I think the Leader of the Opposition came away fully cognisant of what the problem really was. In many areas the land is like a desert. The topsoil has been blown away, and sand drifts across the road. It will certainly take many years to recover, even with good seasons. I do not claim to have all the solutions. I suppose the solutions are in the hands of the Almighty. I am afraid that unless solutions are found soon, many of these farmers will go to the wall.

As I said, the second major problem that faces the Grey electorate results from the closure of the Whyalla shipyard. It is felt in Whyalla that the Federal Government has completely ignored the people’s problems. The Government ignored the people of Whyalla when it was suggested that a system could be implemented to keep the shipyards going. There was a lack of answers to questions asked by the South Australian Premier, by the City Council of Whyalla, by the various organisations in Whyalla and by me. Promises were made by the then Minister for Industry and

Commerce, Senator Sir Robert Cotton, that he would go to Whyalla and look at the problems. That promise was never carried out. It has been the subject of some adverse comment by the Mayor of the Whyalla City Council as to what the Government intends to do. The Government has made promises which it has never carried out. It could have sent someone to Whyalla to look at the problems to see whether it could come up with something which would assist in some way.

Last July Liberal and Labor senators met in Whyalla with the local council. They made certain pledges that they would support the report of the Joint Committee on Foreign Affairs and Defence on the retention of both Whyalla and Newcastle as shipbuilding centres. The Liberal senators, when given the opportunity in the Senate to back what they had said in Whyalla, not only supported the gagging of the debate, but also voted against the idea which they had supported in Whyalla. Quite recently a public meeting was called in Whyalla by the local Community Council for Social Development. Senators from both major parties were invited to Whyalla to discuss the problems. The result was that three Labor senators turned up for the meeting, but no Liberal senators at all were present. So we can understand why the people of Whyalla are a bit disillusioned by this particular Government.

At the present time more than 13 per cent of the work force of Whyalla is unemployed. With the completion of the work in the shipyards at the moment- only the fitting out of the last ship remains to be carried out- that percentage of unemployed will increase. It is quite obvious that the Broken Hill Proprietary Co. Ltd cannot absorb all the unemployed people as it earlier said it could. Previously it was able to employ many people in the steelworks, but with the downturn in the steel industry and the lack of orders being placed, this has not been possible. So we have that problem.

I mention one other matter. During the time in which I have been the member for Grey, when I have been approached by constituents I have never tried to be party political in the sense that I asked a person his political affiliations. I hope that because I have not done so I have been able to gain the respect of many of the people in my electorate. I find the attitude of some Ministerscertainly not all, but at least some- very petty in regard to the way in which they treat members of the Opposition. Any member who represents a large electorate has problems, just by reason of the electorate’s size. When Ministers withhold information that makes the situation even worse. I have found, in regard to many matters I have taken up concerning my electorate, that the information gets to the Press through a senator. I can cite one case where the information got to the Press by way of a State Liberal member. I feel that this is an affront to the local member who does most of the work in the electorate. Such a thing should not be allowed to happen.

I cite the case of the provision of television services to the Eyre Peninsula. I have raised the matter on numerous occasions in this House by way of question, I have spoken about it in various debates and I have presented petitions in this regard. At no time can I ever remember receiving any answer from the previous Minister for Post and Telecommunications to my approaches on this question. About a fortnight before the general election, I was informed that the Government had released its program concerning the extension of television services to country areas. It was only by sheer luck that I found out such information had been issued, because no information had ever been sent to me. When I took up the matter with the Minister’s office, I was told that something had been issued and that they would post it to me. I said: ‘Why post it to me because as far as I know all the other country members who were concerned about the proposal to extend television services have been informed by telegram or telex’. About five days later I received from the Minister for Post and Telecommunications a letter which was undated, which bore no address and which was unsigned. It included the Government’s proposals and an attachment which showed the proposed extension of television facilities in the electorate of Grey. When I looked at the areas which were to receive the additional services, I found that Eyre Peninsula, the area I had been pushing the hardest, had been ignored. Naturally I issued a Press statement condemning the Government for ignoring that area. Incidentally, I was pretty upset that I had not been informed, and I told the Press Secretary of the Minister for Post and Telecommunications that I was not too happy about the whole matter. Ten days prior to the election there was an announcement that a mistake had been made. Somehow it was omitted from the statement that there were proposals to provide Eyre Peninsula with television. Last November or early December, Senator Jessop from South Australia and the then Liberal candidate for Grey made an announcement that television would be provided to that area within 12 months. I felt that it was a case of a Minister or the senator telling a deliberate untruth in order to try to save the Liberal candidate from the political backwash resulting from not providing a television service to that area. That is how the situation finished up, as was demonstrated on election day.

I approached the present Minister and, from what the Minister told me, it was apparent that the statement that television services would be provided within 12 months was issued for purely political purposes because it was proved to be completely wrong. The Minister stated that the Government had drawn up a draft program which covered the period to 1981. When I refer to a draft program, I mean that it had yet to be approved by Cabinet. This is the way in which this matter of gaining information from the Minister about the provision of television services has gone on. I trust that the present Minister will treat Opposition members from large electorates in a less party political manner than did his predecessor, and I trust that he will at least have the courtesy to reply to the approaches made on behalf of the constituents of those members who represent large electorates, to whatever political party they belong.

I wish now to raise a few matters related to social security. One of them is concerned with the tight guidelines which apply in relation to the payment of the unemployment benefit. Some particular cases came to my attention in Whyalla. People who were out of work and receiving the unemployment benefit decided to use a small plot of land which they owned to try market gardening. From the moment they turned their first sod they lost their unemployment benefit. I feel that that action was a little harsh. I have taken up this matter with the Department. The honourable member for Murray (Mr Lloyd) has already drawn its attention to a similar case in Victoria. I believe that the case referred to in his electorate was used as an example in giving a reason why those people could not be paid the unemployment benefit. However, I feel it is unjust that, when people take initiatives to try to earn some money and try to become productive, from the moment they turn their first sod of soil they lose their unemployment benefit. I feel that they are paying a penalty for initiative.

One other matter at which I would like the Government to have a close look is the cut off point at which pensioners are no longer eligible for fringe benefits. Fringe benefits payable to pensioners have amounted to $34 for a single person and $57.50 for a married couple. As the years go by and because of the effects of inflation, more and more people who have a small private income other than their pension are moving above the cut out point and are losing their fringe benefits. I feel that the amount of benefit has remained at a static point for far too long. It is about time the figure was raised so that such people are not disadvantaged as they are now. Many of the people who have complained to me are old people. Many of them are Commonwealth superannuation pensioners who made their superannuation contributions when wages were much lower than they are at present. Ever since the Labor Government introduced indexation of superannuation pensions, more and more of these people have moved above the cut out point each year and have lost their fringe benefits. I trust that that matter will be given attention by the Minister.

Another matter I wish to raise concerns the application of the means test to the earnings of pensioners. For a very long time the amount of extra earnings for a pensioner has remained at $20 for a single person and $34 for a married couple. I am not quite sure when those figures were last adjusted, but they are completely ridiculous in this day and age, particularly when one looks at today’s money values. The amount of extra income a pensioner is allowed to earn should be adjusted according to the cost of living index in the same way as the pension is adjusted. Twenty years ago one probably had to work 10 or 15 hours to earn $20. Nowadays, with wages at the levels they are, one could probably earn that $20 by doing four or five hours work. So the present situation certainly does not encourage pensioners to try to get themselves off the bottom rung by earning extra money because, when they do so, they lose part of their pension when they reach that cut out point of $20 for a single person and $34 for a married couple.

A widow came to see me last week. She is now living on her own, but she has reared five children who are now grown up. She has worked hard to raise those children. Now that they are grown up she is on her own and she feels that she would like to enjoy life a little, probably by taking tours around the country. The moment that she earns $20, which she can do in a few hours, she finds that her pension is reduced. I trust that the Minister for Social Security (Senator Guilfoyle) will give consideration to this matter also with a view to upgrading the point at which pension payments begin to diminish.

The final matter I wish to mention concerns the abuse in some areas of the scheme which provides subsidies to employers who take on young people. Two cases have been brought to my attention in which the employer has taken on a young person and, at the conclusion of six months, has sacked that person for no reason and has immediately gone along to the Commonwealth Employment Service and taken on another person. Such employers are subsidised to the extent of $57 a week for taking on these young people. It is outright exploitation of the scheme which is supposed to be assisting young people to obtain employment, but all it is to some unscrupulous employers is a scheme under which they can get cheap labour.

I have been approached by a particular union which has drawn my attention to cases similar to those I have just mentioned. I believe that this matter deserves closer examination. I have discussed the matter with the Commonwealth Employment Service. I have been told that the Service is pretty vigilant. However, I was told by its officers that they feel that some unscrupulous employers are abusing that scheme. If that is the case, I think the situation needs to be watched more closely. Although I feel that some of the schemes which the Government has established to assist young people have only a cosmetic effect, this scheme may have some merit. It certainly should not be abused in the manner that it is by some unscrupulous employers.


-Mr Deputy Speaker, may I ask you to convey in the traditional way to the Speaker and to the Chairman of Committees my personal congratulations and those of the people of the electorate of McMillan. It is a pleasure to speak in the Address-in-Reply debate following the Speech delivered by the Governor-General, Sir Zelman Cowen. He was Dean of the Faculty of Law at the Melbourne University. Having personally passed through that faculty, it was no surprise to me that the high office of Governor-General was bestowed on Sir Zelman Cowen.

In the time available to me in the AddressinReply debate I would like to record the Government’s position on apartheid in South Africa. The Governor-General made two comments in his Speech relevant to this issue. He said:

My Government will carry out a continuing program of law reform, particularly with a view to protecting civil liberties and enhancing civil rights. Constant vigilance is required to ensure that the rights of individual citizens are not eroded or ignored.

In South Africa, since 1948, law reform against the black population has taken a course which has been more repressive each year than the year preceding. I shall refer to that legisltaion later. The Governor-General also stated the Government’s fundamental belief: . . . that a better society can only be realised by giving the men and women of Australia a greater measure of choice, power and freedom.

There is no freedom in black Africa. The crime of apartheid is one which has been condemned by Liberal-National Country Party governments over a number of years. In 1961 the Australian Prime Minister, Mr Menzies, as he then was, stated:

I am against apartheid because it offends the conscience, against it as a basic policy because it seems to be doomed to a terrible disaster.

The Prime Minister (Mr Malcolm Fraser), at the Commonwealth Heads of Government meeting in London last year, stated:

Apartheid cannot succeed even in terms of its own logic. A policy that pretends to foster equal social development but which involves permanent separation of the races and permanent political inferiority on one race will not, and cannot, succeed.

At the World Conference for Action Against Apartheid in Lagos, Nigeria, on 23 August 1977, the Australian Minister for Foreign Affairs (Mr Peacock), made Australia’s position very clear to the delegates from the 112 nations participating when he declared:

We are utterly opposed to it as an unjustifiable and repugnant system and we want to see it end as soon as possible.

We are opposed to it on moral grounds because it constitutes an affront to the dignity of men . . . and is a flagrant violation of fundamental human decency.

We are opposed to it on intellectual grounds because its arguments are fraudulent and internally inconsistent. We are opposed to it politically, for it is a design for disaster . . . it necessarily involves continued and increasing dependence on repression.

The August 1977 World Conference for Action Against Apartheid adopted a declaration which included a definition acceptable to the overwhelming majority of delegates and which included reference to the following:

Apartheid, the policy of institutionalised racist domination and exploitation imposed by a minority regime in South Africa is a flagrant violation of the charter of the United Nations and the Universal Declaration of Human Rights . . . it is a crime against the conscience and dignity of mankind . . . this inhuman policy has been enforced by ruthless measures of repression and has led to escalating tension and conflict.

I believe that it is a proper time for this Parliament to record its opposition to apartheid for a number of reasons. In its last session the General Assembly of the United Nations proclaimed by resolution that the year beginning on 2 1 March 1978 will be the International Anti-Apartheid Year. The commencing date for the year commemorates the Sharpeville massacre of 1 965. All member nations will be asked to commemorate this International Anti-Apartheid Year to demonstrate a desire to see the abolition of apartheid as a crime against humanity.

It is also proper to raise the matter in the House this week having regard to the presence in Canberra of Mr Donald Woods, former Editor of the East London newspaper in South Africa, the Daily Dispatch. Honourable members will be aware that Mr Woods is one of the speakers at the International Press Institute’s General Assembly and is one of the ‘people who have humped the cross of free speech and dissent, who have stumbled under pillory and punishment and bureaucratic bloody-mindedness’. Donald Woods was one of the many people in South Africa banned under the Internal Security Act, that legislation having as a predecessor the Supression of Communism Act. I believe that we must further publicise and oppose the repressive and disastrous features of the South African Government’s policy to help balance some of the distorted propaganda which emanates from such sources as the League of Rights in this country or such publications circulating in this country as the South African News and Views. In the January 1978 copy of that publication a summary is given of the National Party success in the November elections in South Africa.

The National Party since coming to power in 1948 has continuously maintained the implementation of apartheid as an essential plank of its political platform. It has won seven successive elections. The 1977 election results were overwhelming. It gained a further 1 8 seats giving it 134 seats out of a total of 165 seats. The election was called 18 months earlier by Prime Minister Vomer at a time when both internal and external criticism of the apartheid policy was on the ascendancy. Unfortunately for the blacks in South Africa there is a direct relationship between increased repressive measures and cries for freedom. Only the whites in South Africa have the right to vote. Of an estimated population of 26 million in 1976, only the white population has electoral franchise despite the fact that it represents only 16 per cent of the total population. Notwithstanding the racial imbalance, the whites control approximately 87 per cent of the total land area in South Africa. Prime Minister Mr B. J. Vorster, speaking after his party’s return to government, is quoted as saying:

We want to give them -

He is referring to the blacks- the right to control their own education. We want to give them rights in the maintenance of law and order in their cities and local authorities.

Those words sound fine, but they have a meaning in South Africa different from that in Australia.

One proposal which was an election issue sought constitutional change to give added status to the coloureds and Indians of South Africa. Under these proposed changes an executive president would be appointed as head of state and there would be a separate parliament for white, Indians and coloured groups from which a joint cabinet would be formed under white leadership. Again, it is interesting to note that the Indian populaton comprises 2.5 per cent of the total and the coloured 9 per cent. Nothing is said of the black 72.5 per cent of the population. We had to wait until February 1978 to learn what was proposed for the blacks in South Africa. In February this year the new Bantu Administration Minister, Dr Mulder, in the course of parliamentary debate on the Bantu Citizen Amendment Bill, stated that he did not wish to hide the facts but that the governing party’s policy, when carried to its full consequences, would mean that blacks would have no political say in South Africa whatsoever. No black South African will hold South African citizenship. The leader of the new Republic Party, Mr Raw, interjected with the words ‘That is your dream, that is your nightmare ‘, words, which to quote the Melbourne Age editorial of 9 February 1978, had the ring of tragic prophecy. Some people in Australia are quick to condemn those who criticise the South African apartheid policy and many are quick to label opponents as communists or sympathisers of communists. Honourable members will appreciate that this is an easy and simple means of condemnation and one which demands an immediate and unthinking response.

In the time left to me I wish to highlight briefly some of the repressive legislative measures introduced and passed by the South African Government since 1948 and some of the repressive measures adopted by the police state tactics of the South African regime. In doing so I want to rely on primary sources where possible and certainly rely on reputable independent international organisations like the International Commission of Jurists, Amnesty International and the United Nations. I do not therefore intend to talk about the future of the South African Government should Zimbabwe identify itself with black Africa and apply military pressure to that country. I am not concerned with the type of harangue which comes from the Eric Butlers of this world. The evidence identifying apartheid as a crime against humanity is overwhelming, and in the short time left to me I feel I cannot cite sufficient examples which would raise voices of condemnation from every responsible and thinking Australian.

I want to talk of government policy and action, of facts not fiction, of the choice or lack of choice between suppression, prejudice, bigotry and imprisonment and that of the right of the individual to live in freedom under the rule of law. In so doing I do not condone the military interference of any nation in the sovereignty of another state. It may therefore be instructive to examine selective pieces of legislation commonly referred to as ‘repressive legislation’. Dicey has defined repressive legislation as statutory enactments which violate the most fundamental requirements of the rule of law in that they permit punishment without trial in the regular manner before an ordinary court; such statutes being aimed at preventing free expression of dissent from fundamental government policy by penalising dissenters and those who, whatever their personal opinions, effectively represent the dissenters or support their right to their beliefs.

From 1948, in its first five year term, the Nationalist Government prohibited mixed marriages in the Prohibition of Mixed Marriages Act No. 55 of 1949. It reinforced the penalties of ‘immorality’ across the colour line in the Immorality Amendment Act No. 55 of 1949. It began the complete geographical separation of the races in the Group Areas Act No. 41 of 195 1 which was superseded by Act No. 77 of 1957. It legislatively suppressed communism in the Suppression of Communism Act No. 44 of 1950 which has since been amended on 80 occasions. It commenced the racial classification of every South African in the Population Registration Act No. 30 of 1950. It created a new system of government for Africans in the reserves in the Bantu Authorities Act No. 68 of 195 1 and so on. Africans responded by a series of mass protest meetings as well as by constant minor violence of a sporadic nature. In mid- 1952 the African National Congress publicly called for nonviolent disobedience of apartheid laws, the socalled Defiance Campaign. In response, the Government enacted the 1953 Criminal Law Amendment Act and Public Safety Acts. The Acts were designed to prevent future organised civil disobedience by setting extraordinary penalties for minor violations committed, as it was stated in the Acts, ‘by way of protest’.

South Africa became a republic in 1961 and, following renewed acts of sabotage, riots and most notably Sharpeville, the Government passed the General Law Amendment Act No. 37 of 1963, the so-called ‘90 day clause’. This Act enabled police to hold any prisoner incommunicado, without any right to habeas corpus, in order to extract information in relation to alleged sabotage or dangerous crimes. Eighteen months later the law was suspended. However, at the end of the same parliamentary session in 1965, the Minister of Justice announced the ‘180 day clause’ Act which authorised ‘protective’ detention of state witnesses and forbade the courts to interfere. The word ‘protective ‘ is taken from the Act, the Criminal Procedure Amendment Act No. 96 of 1965.

The late 1960s and early 1970s witnessed a substantiation of the Government’s control over apartheid and dissent. Some of the measures introduced included the Prohibition of Mixed Marriages Amendments Act, which stated that partners to a mixed marriage contracted outside South Africa could be prosecuted under the Immorality Act if they returned to South Africa and lived together, and the Abolition of Juries Act 1969, which provided for the repeal of laws dealing with trial by jury in criminal proceedings. I could give other examples.

This period also witnessed a stringent legislative attack on the Press. The Publications and Entertainments Amendment Act 1969 provided that where the Publications Control Board found a publication to be ‘undesirable’- that is the word used in the Act- it would then become an offence to publish such material. The Internal Security Act introduced in 1976 maintained and broadened the scope of the 1950 Suppression of Communism Act. It was first gazetted as the Protection of State Security Bill but renamed as the Internal Security Act because the proposed Bill could be abbreviated to the ‘SS Bill’ which had Nazi connotations. There may be a great deal of sensitivity in South Africans with respect to that connotation. The Act created a 10-member parliamentary commission appointed by the Government to investigate matters referred to it by the government affecting internal security. These matters included suspected activities or suspected organisations. There is no provision for the formulation of any charges against persons under suspicion. There is nothing giving the person under suspicion the right to legal representation or for informing the person under investigation of the allegations existing against him or what evidence is available to support these allegations. The proposals in the Bill have been referred to as measures amounting to legalising witch-hunt. Within a short time of its introduction, the South African Minister of Justice used the powers granted to him under the Act to order the preventative detention of more than 130 people regarded as critics or offenders of the South African policy.

I made reference earlier in my speech to the Terrorism Act of 1967. This Act is far-reaching and perhaps the most frequently used in South Africa. Under that Act it is regarded as a terrorist offence for any person to further or encourage the achievement of any political aim or social or economic change. Any person would be guilty of an offence under this Act if he encouraged any activity which resulted in embarrassment to the administration of the affairs of the state, obstruction to the free movement of any traffic or prejudice to any industry or undertaking. Any person adjudged under the terms of this Act to have engaged in such activites has committed the offence of participating in terrorist activities. The onus of proof is placed upon the accused to show beyond reasonable doubt the innocence of his or her alleged activities.

Section 6 of the Terrorism Act provides for detention without charge for an indefinite period. Any person so detained is held incommunicado and therefore denied access to family, legal advisers and independent medical practitioners. The January 1978 report of Amnesty International on political imprisonment in South Africa records that in October 1977 the South African Institute of Race Relations issued figures on the number of people detained. It was estimated that as at 30 September 1977, 662 people were in detention and that between January 1976 and September 1977, 566 detainees had been released uncharged. The Institute calculated that as many as 97 people of those freed had been detained for more than one year. The complexity of laws, by-laws and regulations passed by governments in South Africa to enmesh the black population in its apartheid policy is massive. Mr Deputy Speaker, I seek leave to incorporate in Hansard a list which gives some simple examples of the nature of these suppressive laws and regulations.

Leave granted.

The document read as follows-

An African who was born in a town and lived there continuously for SO years, but then left to reside elsewhere for any period, even two weeks, is not entitled as of right to return to the town where he was born and to remain there for more than 72 hours, unless he has obtained a permit. If he does remain without a permit, he is guilty of a criminal offence punishable by a fine of up to R20* or, in default, imprisonment for up to two months.

No African, even if he has been lawfully residing in a town by virtue of a permit issued to him, is entitled as of right to have his wife and children residing with him. They are permitted to reside with him only if they have been issued separately with permits to do so.

An African boy, aged 16, who has left school and lives at home with and is maintained by his parents but does not work may, at any time, be arrested without warrant by a policeman who ‘has reason to believe that he is an idle person’.

An African who was born in a town and has worked and lived there for five years may be required at any time to leave that town and take up residence in another African area where he has never lived and where he has no relatives or friends. If he remains in the town more than three days after he has received written notice to leave, he is guilty of a criminal offence.

An ‘obvious white’ person who is married to or cohabits with an African or a Coloured person is included in the African or Coloured group, as the case may be.

The African group includes ‘any person who is or who is generally accepted as a member of an aboriginal race or tribe of Africa’.

Any man, although obviously in appearance a white person, who is married to an African woman is a member of the African group.

An African employed in a supermarket who refuses to resume work which he has discontinued is guilty of a criminal offence.

An African factory worker who is absent from work for 24 hours without permission, in addition to being dismissed, (a) may be fined by a Government inspector an amount up to R2, which is withheld from his wages; and (b) is guilty of a criminal offence punishable by a fine of up to R50 or imprisonment for three months.

A white workman who is permanently totally disabled is entitled to a monthly pension based on his earnings; an African similarly disabled is entitled to a lump sum based on his earnings, but not to a monthly pension.

An African living in a town who conducts a class in reading and writing without remuneration in his own home for a few of his African friends is guilty of a criminal offence. The ‘offence’ is punishable by a fine of up to R200 or imprisonment for six months.

An African religious minister who conducts regular classes for his congregation in which he teaches them to read the Bible is similarly guilty of a criminal offence.

It is unlawful for a white person and a black person to drink a cup of tea together in a cafe anywhere in South Africa unless they have obtained a special permit to do so.

A man married or single who is ‘obviously in appearance’ or ‘by general acceptance and repute’ a white person and who attempts to have sexual intercourse with a woman who is not ‘obviously in appearance’ or ‘by general acceptance and repute’ a white person is guilty of a criminal offence punishable by imprisonment with compulsory hard labour for up to seven years, unless he can prove to the satisfaction of the court that he had reasonable cause to believe, at the time that the alleged offence was committed, that she was white.

Every African, male and female, between the ages of 1 8 and 65, is liable to pay an annual tax (known as the general tax) of at least R3, in addition to the ordinary income tax payable by all South Africans.

Every African who is the occupier of a dwelling in an African township is liable to pay an annual tax (known as the local tax) of Rl.

A white man who tells a group of Africans that the apartheid laws are unjust and should be disobeyed is guilty of an offence punishable by a fine of up to R200 or imprisonment for one year, or both.

An African who writes ‘ Down with Apartheid ‘ on the wall of the house of any person is guilty of a criminal offence punishable by imprisonment for up to six months without the option of a fine.

No African may serve as a member of any jury empanelled for any criminal trial, even where the accused is an African.

Any policeman in the performance of his function of preserving ‘the internal security’ of South Africa may at any time without a warrant search any person or premises anywhere in South Africa and seize anything found on such person or in such premises.


-I thank the House. The examples were prepared by Mr Leslie Rubin at the request of the United Nations. He was formerly a senator in South Africa representing African voters and is now, I believe, a professor of comparative law at Howard University in the USA.

Another device used by the South African government to control the black minority is the use of the banning order. The Minister of Justice and Police, Mr James Kruger, has the power to issue banning orders without preferring charges in court and without giving any reasons therefor. No victim has the right to challenge the Minister’s decision in court.

One interesting example was given by John Berman in the London Financial Times in relation to the banning orders served on the organisers in the Black Labor Movement in Johannesburg, Cape Town and Durban in 1976. The Government sought to ban the urban training project. This particular project was helped by a grant from the British Trade Union Congress and the International Federation of Free Trade Unions. It was aimed at providing educational seminars for committee members in basic training in negotiating and conciliation skills. The urban training project was apparently successful. On its first training seminar near Pretoria, 148 trainees from all over the Witwatersrand attended. The absurdity of the banning order is demonstrated in that the urban training projects officials had a reputation as apolitical trade unionists who were highly respected in the more liberal enlightened business circles in Johannesburg. But I guess that one should not waste time seeking logic in the cesspool of apartheid policies applied by the South African Government. Banning orders now can be made under the Internal Security Act whereas previously they were under the Suppression of Communism Act 1950. Banning orders may now be imposed not only against communists or suspected communists but also against any person ‘engaged in activities which endanger or are calculated to endanger the security of the state or the maintenance of public order’. Apartheid has been condemned by the International Commission of Jurists since that body was founded in 1953. It was discussed at length and a resolution passed at the first international congress of jurists in Athens in 1955. On every possible occasion since that date, the International Commission of Jurists has condemned the policy of apartheid and the actions of the South African Government in enforcing the tenets of apartheid which violate the fundamentals of the rule of law.

I conclude by again referring to the 1978 report of the 1977 Nobel Peace Prize winnerAmnesty International- on Political Imprisonment in South Africa. The report states:

Stripped of its pseudo-philosophical basis, however, apartheid is seen for what it really is- a justification for the continuing domination of the black majority population by South Africa’s ruling white minority. (Extension of time granted). The report goes on to state:

It is a system of institutionalised racial segregation and racial domination which provides for discrimination against blacks in all walks of life. They are denied equal opportunities with whites in education, in employment and, most importantly, in determining by whom they should be led and by whom they should be governed. Blacks are treated as inferior human beings, and are condemned to a subservient role.

I commend that publication to all honourable members. I conclude by referring to the sad and pathetic case of the death of Steve Biko. With the banning of objective commentators in South Africa, we in Australia increasingly will have to rely upon international independent assessors and those fortunate enough to escape the regime. The case of Steve Biko unfortunately was one of many involving detainees and political prisoners dying in suspicious circumstances. The so called lies which surrounded the activities of the security police in South Africa have at least been consistent over the years. So many detainees have committed suicide by hanging, to quote the police, or have thrown themselves out of the windows of their prison cells. In the inquest which was finally conducted in Pretoria, the South African security police chief stated that Mr Biko- I am now quoting from a report in the Canberra Times of 19 November 1977- tried to kill himself and was ‘apparently set on selfdestruction’ before his death in detention. Also reported in that newspaper was a version of what happened by Colonel Pieter Goosen, the head of the Port Elizabeth security police, whose version was challenged by Biko’s family. He said in an affidavit which was read by Biko ‘s lawyer:

The deceased was apparently set on self-destruction even with his method of breathing during detention.

I conclude by contrasting those words and the picture which was painted of the security police there with the words of Helen Suzman who has been a guest of this country and indeed of this House. She described Biko in the following terms:

The Vorster people are like lemmings running into the sea. Biko was a moderate trying to reach out to us.

One could go on for a long time giving evidence of the shocking practice of apartheid which is practised by the regime in South Africa. It comes as a surprise to me that people in Australia who claim to be intelligent can still condone apartheid in South Africa.


– I congratulate the honourable member for McMillan (Mr Simon) on his speech. He certainly did not upset people on this side of the House, although he seems to have upset the honourable member for Holt (Mr Yates) and the honourable member for Cowper (Mr Ian Robinson). It is a pleasure for me to be sandwiched between the honourable member for McMillan and the honourable member for Diamond Valley (Mr N. A. Brown) in the sequence of speakers tonight. They are two left wingers, so to speak, of the Liberal Party, and I am usually regarded as one of the right wingers in the Australian Labor Party.

Mr N A Brown:

– Do we get an extension of time if we do not agree with what you say or only if we agree with what you say?


-Only if we agree. Tonight I should like to take a shotgun type of approach to politics and deal with a number of issues. This is the only time, apart from later in the year when we are speaking on the Budget, that we are able to do this sort of thing. I should like to make a few points. I refer firstly to an interesting phenonemon; that is, the phenomenon of some of the conservative persons in the communitysincere, honest, et cetera, conservative peoplewho have suddenly become disappointed or disgusted with this Government. I refer specifically to Mr Geoffrey Fairbairn who, as many honourable members know, is a reader in history at the Australian National University in Canberra. He conducts a course in the history of revolts and insurgencies and has written books on the subject. He has always been what one would call a right wing intellectual in this country. He has taken an aggressive right wing line, as it is generally considered to be- a conservative line I suppose would be a better term for it. He has demonstrated how upset he has become with this Government, specifically with the Prime Minister (Mr Malcolm Fraser) on the so-called Kerr issue. I seek to incorporate in Hansard a letter by him which was published in the Sydney Morning Herald yesterday.

Leave granted.

The document read as follows-

page 553



Sir, Now that Sir John Kerr has resigned- a decision that should evoke only sympathy from those concerned with principles- there is, or used to be, a great Australian tradition that one did not kick a man while he was down.

Ordinary Australians like myself should surely only rejoice that, whatever pain Sir John may have suffered, he has in his resignation gone far to heal otherwise irreparable wounds.

It is quite impermissible, in my view, that Labor politicians should now go on implying that Sir John was somehow a ‘traitor’, since this is to imply that they saw him as their creature. Governors-General can only commit treason in the true and terrible sense of that term: conspire to bring about the ruin of the kingdom, polity, society- call it what you will.

There is no evidence whatever to suggest that Sir John at any time behaved in such a fashion; it is also clear, in my view, that in November, 1975, he behaved- for reasons that he may justify- in such a way as to give countenance to the view that he finally decided, with all its wretched consequences, to accept the LCP ‘ blocking position ‘.

It is this ‘blocking position’ in regard to Supply that I now realise, far too late in the day, was subversive of our kind of constitutional democracy. It was this conduct, not the ultimate decision of the then Governor-General, that really caused many Australians to believe, wrongly in my view, that reformism was going to be denied at all costs by the socalled ‘Establishment ‘.

The man responsible for this is not the Governor-General but the then Leader of the Opposition. I am extremely sorry to have to hammer this point home. It gives me no joy to attack a man whose father gave me a phrase of utmost helpfulness in living; whose mother was one of my mother’s greatest friends; whose wife and children I have no wish to Offend.

I have no wish whatever to offend the Prime Minister; we were never friends, so there is none of that bitter personal sense of betrayal that marks the Labor leaders’ attacks on Sir John Kerr.

I am only concerned to establish very clearly indeed that (as I have written before) my old friend Manning Clark and Mr Patrick White- some of whose views I do not sharewere basically right about one thing in particular: the manner in which the Labor Government of 1 975 was brought down was utterly deplorable. In my cowardice in the face of this issue at the time, I took my sons to Fitzroy Island in order to evade it. I failed as a citizen.

It is surely time that what has been elegantly described as ‘the armpit of the southern hemisphere’ took stock of itself. If the present Prime Minister cannot recognise that something very squalid has taken place- if he remains impervious to the decencies and niceties of constitutional democracythen we are in for a very rough time indeed.

GEOFFREY FAIRBAIRN, Tasmania Circle, Forrest (ACT).


– I shall quote a little from the letter to emphasise the point that Mr Fairbairn makes, namely, the deplorable manner in which the Government was brought down in 1975 and how upset he is about it. His letter concluded:

If the present Prime Minister cannot recognise that something very squalid has taken place- if he remains impervious to the decencies and niceties of constitutional democracy then we are in for a very rough time indeed.

I emphasise that point. It is important, and hopefully some of the people on the other side, not only of this House but also in politics generally, will realise that there are difficulties associated with the line being taken by the Prime Minister.

I turn now to the reaction by the Prime Minister to what happened outside the Hilton Hotel approximately three weeks ago. Again I quote from Geoffrey Fairbairn. I ask for leave for his statement which was in the National Times on 27 February to be incorporated in Hansard.

Leave granted.

The document read as follows-

page 553


By Geoffrey Fairbairn

The happening at the Hilton Hotel and its aftermath evoked memories of situations of violence in far off places, since it is my business to study the phenomenon known by the ambiguous and privileged word, terrorism.

Belfast, for instance, when accompanying an army patrol through a bad area at night: a lovely girl followed us for some time, shouting to whatever sniper might be hidden among the chimney pots, ‘they’ve got a branch man with them. ‘

Being in civilian clothes, I was in her imagination the special branch man, and she was inviting one of her pals to kill me (or execute me, according to one ‘s views these days).

The special branch, after all, was founded last century specifically to deal with Irish (then Fenian) terrorism: I was the target for the night.

The experience was disagreeable but intelligible: this girl’s fiancee had just been picked up for attempted murder. They belonged to a long history of injustice and contempt- a long history of the cult of the gun too, equally important.

The relevance of this otherwise not very interesting memory I hope I can quickly establish: when I began to watch hundreds of uniformed troops being made to regale TVviewers with their absolutely pointless meanderings in and around Bowral I began to ask myself whether the Prime Minister, who appears to have assumed the guiding role, had taken leave of his senses.

That not being very probable, I began to ask myself whether the Government had permitted the growth of some vast organisation of terrorists, which as a result of brilliant penetrative and surveillant intelligence activities, they were about to smash- and thereby make the governments of the still comparatively civilised world their eternal debtors.

That does not appear to have been the case: quite clearly this grotesque misuse of the army was either the result of panic or of a rogue-elephant approach to anything that might seem to get in his way.

The extraordinary coincidence in time between his trampling upon precious constitutional decencies in the case of the former Governor-General and this unconscionable display of force, which flew in the face of even the British imperial tradition, where the minimum use of force was paramount doctrine, seemed quite suddenly- only of course on the level of symbolism (the most important level of all)- to assume a certain congruence.

The saying of our time-one man’s terrorist is another man’s freedom fighter’- is altogether pernicious so far as a constitutional democracy is concerned.

People who engage in politically motivated violence in a democracy are criminals and they should be regarded as such- and therefore the Army should never, never, never be brought out to deal with them.

I mean the Army as such: obviously specialist units, such as the special air service and the explosives, etc, branch must be used on occasion.

The British Army was in 1969 brought into action in support of the civil powers for reasons that just do not obtain in Australia today, or in the foreseeable future, when they were brought out, to put it brutally, to prevent a pogrom against Catholics, in a situation of mob violence which the police of that day were singularly unequipped to deal with.

Transnational terrorism (that is, terrorism used by groups who are not agents of sovereign governments) represents a very tricky problem. Their activities can be appalling in terms of individual lives, though in fact they have killed very few people, comparatively speaking, since their activities reached a kind of watershed in 1968. Most of their activities have not ultimately been lethal, though monstrous in terms of moral and political blackmail.

The destruction of such terrorist groups, which now have ‘servicing facilities’ (usually supplied by the KGB) on an international scale, should be the hope of all people who believe in democracy as a mode of political behaviour (a mode of behaviour, I would insist, that is far more deeply subverted by the rogue-elephant approach on the non-violent level than it ever can be by disparate groups of terrorists ‘calling despair and violence to the regeneration of the world).’

The destruction of such groups can only be achieved over a long period of time by professionals- by the officers of penetrative and surveillant intelligence services (the ordinary police often being of tremendous significance). It is not a job for politicians: nor is it a job for soldiers, except for their specialists in special situations.

Above all, it is absolutely necessary to realise what the terrorist (a criminal in a democracy, I must repeat) is really after. He is first of all after publicity; in some ways he is a creature as well as an exploiter of satellite TV. As an expert, Brian Jenkins of RAND, once put it, ‘Terrorism is psychological warfare. It is theatre. ‘

The terrorists cap never win in a constitutional democracy, provided that the leaders of democracies stick to their lastthat is, behave according to the democratic mode of behaviour: never break its unspoken rules themselves and treat terrorists as criminals. What democratic leaders must never do is to break the rules themselves and give the impression, however inadvertently perhaps, that because a bomb has gone off- a bomb about which nothing at all seems to be known as to its provenance- it is permissible to declare a local state of siege and thereafter cash in politically on that word terrorism .

As though one bomb- the USA once knew over 4,000 bombs in a year- could be used subtly to alter the perceptions of the population as to what was permissible in terms of ‘security’.

I am technically all in favour of greater security- and being only a very ordinary citizen, in terms of security not only for politicians (few politicians cared when ordinary

Australians were physically shattered almost beyond a few years ago by bombs thrown by ‘Yugoslavs ‘).

I am also aware, as someone who has given years of attention to this problem, someone who has hundred and hundreds of files on it, as well as some experience ‘in the field’ that this kind of revolutionary criminality is far, far too serious a business to be left to politicians especially since our Prime Minister does not seem to understand that the primary objective of any kind of terrorist is precisely to precipitate the type of over-reaction we saw last week in Sydney.


– I thank the House.

Mr Cotter:

– What did he say?

Mr Yates:

-Yes. What did he say?


– I shall quote from the article. I think the argument that Mr Fairbairn puts is very important because it gives the reaction to terrorism in democracies by people who believe in democracy. It also gives the sorts of things that terrorists want people to do. He says that we should not react in the fashion the terrorists want and that it is important not to over-react. Let us look at the aims of terrorists. The picture is most clearly shown at present in West Germany. The terrorists accuse, incorrectly I believe, the West German Government of being a totalitarian government and then say to people in the community: ‘What is the difference? You object to us because we take terrorist actions, but what else can we do when we are dealing with a totalitarian government?’ There is no totalitarian government in West Germany. There is no totalitarian government in Australia. It is a democracy, and democracies should behave in a certain way when they are dealing with terrorism or attempted terrorism. After dealing with Ireland Mr Geoffrey Fairbairn stated:

The relevance of this otherwise not very interesting memory I hope 1 can quickly establish: When I began to watch hundreds of uniformed troops being made to regale TVviewers with their absolutely pointless meanderings in and around Bowral I began to ask myself whether the Prime Minister, who appears to have assumed the guiding role, had taken leave of his senses.

I think that is an important point. I was driving to Canberra that Tuesday evening after the Hilton bombing. I passed about 50 armoured personnel carriers and masses of trucks at night. It was a completely pointless exercise. I point out the relevance of this article. I again quote from Mr Fairbairn ‘s article. He continued:

That not being very probable, I began to ask myself whether the Government had permitted the growth of some vast organisation of terrorists, which as a result of brilliant penetrative and surveillant and intelligence activities they were about to smash- and thereby make the governments of the still comparatively civilised world their eternal debtors.

It was not that; it was a misuse of the Army. It was what Mr Fairbairn called the rogue elephant approach, a completely unnecessary one. I hope that the honourable member for Holt will agree with me when I finish quoting from the article by Geoffrey Fairbairn. I feel that his behaviour in this House shows that probably he is closer to the wavelength of Geoffrey Fairbairn, whom I know, than are many other people here. The article stated:

The saying of our time- ‘one man’s terrorist is another man’s freedom fighter’- is altogether pernicious so far as a constitutional democracy is concerned.

We can accept the proposition that in a totalitarian regime people may have to take up arms or use terrorist activity to get rid of a particular government. In a democracy that is not necessary. If a government can persuade the people that it is right, that is the line to take. The article also stated:

People who engage in politically motivated violence in a democracy are criminals and they should be regarded as such- and therefore the Army should never, never, never be brought out to deal with them.

That is the point Mr Fairbairn is making. I think it is important. We must continually emphasise to people that these terrorists are criminals who should be dealt with by the police force. The only time the Army should be used is for specific purposes. If some hostages needed to be freed or something of that sort maybe the Army would be needed. Again I quote from Geoffrey Fairbairn ‘s article. It stated:

Above all, it is absolutely necessary to realise what the terrorist (a criminal in a democracy, I must repeat) is really after. He is first of all after publicity: In some ways he is a creature as well as an exploiter of satellite TV. As an expert, Brian Jenkins of RAND, once put it, ‘terrorism is a psychological warfare. It is theatre ‘.

The terrorists can never win in a constitutional democracy, provided that the leaders of democracies stick to their lastthat is, behave according to the democratic mode of behaviour Never break its unspoken rules themselves and treat terrorists as criminals.

What democratic leaders must never do is to break the rules themselves and give the impression, however inadvertently perhaps, that because a bomb has gone off- a bomb about which nothing at all seems to be known as to its provenance- it is permissible to declare a local state of seige and thereafter cash in politically on that word terrorism . . .

Referring to the behaviour of terrorists, going on to Yugoslavs or terrorism that happened in Australia allegedly arising out of the Yugoslav position, he concludes by saying: . . that this kind of revolutionary criminality is far, far too serious a business to be left to . . . our Prime Minister who does not seem to understand that the primary objective of any kind of terrorist is precisely to precipitate the type of over-reaction we saw last week in Sydney.

I think they are important points that we have to consider and if the Parliament does not consider those sorts of points then I do not know who will. It is up to us to emphasise that we are living in a democracy, that we are living in a constitutional democracy and that people who take violent means to try to change the democracy- and we have no evidence that in fact that was the purpose of the bombing outside the Hilton, but let us assume it was- should be dealt with as common criminals. That is how they should be dealt with.

May I relieve the seriousness of my address at this stage and refer to what I enjoyed as an interesting advertisement during the week after 10 or 11 December last year. There was an advertisement in the travelling pages of a newspaper. I cannot remember whether it was the Sydney Morning Herald or the Age. The advertisement was headed ‘Sick of elections? Come to China’. It was an advertisement for people to travel to China. I think it is one of the important points that we have to remember that we are different from those sons of countries.

I would now like to get on to another issue which I consider to be important, and that is the issue that has arisen in South Australia. The point I want to refer to is the importance to have police forces under the control of governments. I will quote from the transcript of an interview on the Willesee at 7 show on 20 January 1978. Mr Salisbury, as honourable members will remember, was the Commissioner of Police who had been dismissed by the South Australian Government. Having denied that he had any responsibility to the State Government, he was asked by the reporter:

So you’re responsible primarily firstly to someone other that the State Government that hires you?

Mr Salisbury: In that situation my interpretation is yes I am, I am actually responsible to the Crown.

Then there was a discussion on just what that means and the reporter asked him:

So you don ‘t see that you are responsible to the South Australian Government?

Mr Salisbury replied:

It’s very difficult to answer a question like that in brief. This is something that needs analysing and I am not going to say that I am not responsible to the government. I am responsible to the government, with certain qualifications, but I am not subordinate to a politically elected government.

Hopefully we have only politically elected governments in this country and hopefully we will continue to have only politically elected governments in this country. I think that is the important issue there. Somehow he believes that he is responsible to some type of authority provided it has not been politically elected. I think that is an important issue to raise in this House.

Again, on a completely different tack, I would like to refer to an issue which allegedly is peculiar to New South Wales. I am glad that the

Minister for Business and Consumer Affairs (Mr Fife) is sitting at the table because he was prominent in New South Wales governments over a number of years. Whilst in those years New South Wales did not have any starting price betting, SP betting has come in again since the party he supported lost office. I would like to refer to the hypocrisy of a radio station in New South Wales called 2UE which has been running a campaign attacking SP betting- saying that it ought to be wiped out, it is a terrible thing and that the station has evidence that SP betting exists. Station 2UE is one of the stations in Sydney which broadcasts the races. I am a keen racing man and I often listen to them. They go to a lot of trouble to give listeners the Totalisator Agency Board prices, the prices on the tote and the prices with the bookmakers at any particular time. The stations broadcast the prices less than 10 minutes before the start of a race whereas betting on the TAB in New South Wales closes 10 minutes before the start and you have no chance of getting a bet on with the TAB after that time. Obviously the only purpose in broadcasting the prices- and I am thankful for the stations doing this- is for the benefit of those people who want to bet SP, and of course the stations make a profit out of the advertising associated with race broadcasts. I have no objection to the service the stations provide. I am pleased with the service that this station provides but I do object to the hypocrisy on the part of its news department which goes around saying what a terrible thing it is that there is SP betting in New South Wales.

While I am dealing with hypocrisy I would like to deal with Fred Nile’s Senate team for New South Wales. Appropriately enough Mr Reuben Scarf was No. 2 on that Senate team. I have a copy of the advertisement which reads: ‘You get three votes for one when you vote for Fred Nile’s Senate Team’. I suppose it is like people getting three suits for the price of one, I think it was and a shirt, et cetera, tossed in. This is the whole tenor of the advertisement, and I quote from it:

Your vote for the Fred Nile Senate Team will let the ruling party know the ‘silent majority’ of decent Australians support good standards and reject legalised brothels, incest, sodomy, et=, and the permissive views of Don Chipp (Little Red School Book), Mr Billington’s marijuana party and others.

So apparently the team is very strong on those particular issues. The advertisement then sets out a how-to-vote guide. The advertisement suggests that if a voter is voting for the Fred Nile Senate team and supports the Liberal-Country Party he should vote 1, 2 and 3 for the Fred Nile Senate team, then vote 12, 13, 14, 15 and 16 for Chipp’s team and then vote 26, 27 and 28 for what the advertisement calls ‘Whitlam’s Team’, in other words, the Australian Labor Party’s team. That is to say, even though Fred Nile’s Senate team is terribly upset by Don Chipp it still puts him a long way ahead of the ALP. On the other hand if a voter wanted to vote for the Fred Nile team and the Labor Party the advertisement suggests the voter should vote 1, 2, 3 for Nile, Scarf and Judge, then vote 26, 27 and 28 for the marihuana team and 29, 30 and 31 for what the advertisement calls ‘Fraser’s Team’, in other words, the Liberal-Country Party team. So whilst Fred Nile’s Senate team seems very strong on the question of marihuana and on the question of permissiveness, et cetera, it does not seem to affect its actual advice as to how people should vote. The advertisement still put the marijuana team and what it calls the Little Red School Book team ahead of the established political parties. What utter hypocrisy on the part of a team which calls itself a Christian team.

I would like to conclude tonight by quoting from a supplement called the Sunday Argus which is distributed as a supplement to the Sunday Telegraph in the western area of Sydney. It gave a large amount of space last Sunday to a Philip Henry Jeffery who is aged 89. 1 know that the honourable member for Dundas (Mr Ruddock) is tonight at some function being held in honour of Mr Philip Jeffery who, as the supplement points out, has always been closely associated with conservative politics and through the years has been a close friend of every conservative member of parliament representing the Parramatta district and those in other areas in the western region. As a result of an interview with Mr Jeffery- and I think this is the important point in the interview- the report states:

The world was a different, much better place, even in relatively recent times as 1 948, in Mr Jeffery ‘s view. ‘Dreadful things are happening today,’ he says. ‘I suppose a lot of it has been occasioned by the immigration- by people coming here. ‘

That was said by Mr Phillip Henry Jeffery, the adviser to the Liberal Party in the outer western area of Sydney. No wonder the Liberals do not do very well there in elections.

I have not dealt with all the points with which I wanted to deal but let me just mention the socalled Constitutional Security Movement which was set up in New South Wales in order to defeat the referendum on the upper House. The members of the Movement felt very strongly about the referendum. It was run by a chap called Valder. He certainly should have been associated with something called a security movement because he was previously the Chairman of the Sydney Stock Exchange and he did not do anything for the people who had invested in securities. So then he formed what he called the Constitutional Security Movement. It is interesting to note that once the Liberal Party and the Labor Party came to a deal on the ques.ton of the upper House the Constitutional Security Movement went underground.

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

Mr N A Brown:

– The commencement of a new Parliament and the Governor-General’s Speech should encourage us to consider the direction in which our country is proceeding and the direction in which we believe it should be proceeding. If we do not make this examination of” basic principles from time to time we run the risk of getting lost in a wilderness of details and concentrating on short term issues while we ignore the consequences of what we are doing, the type of society we are building and the type of society we believe we should be trying to create. If we are to undertake this type of examination- this is an appropriate time at which to do it- our first task should be to get clearly into our minds what we believe government should be doing and to understand what it is capable of doing.

The most dominant theme of our age has been the expansion of government. It has so expanded at every level that there are now very few areas of human activity that are not controlled by government regulation in one form or another. Usually this control is dressed up as ‘reform’, which is the modern euphemism for ‘change’. My concern is that with this expansion of government it has gone into fields where it cannot achieve any desirable improvement in society and where it may indeed be counter-productive. Government is now involved with activities which our basic principles should tell us are not proper areas for government involvement. As government has expanded, so has it drifted further and further away from the basic principle which is its only justification, and that is that it exists only to serve individuals and not to control them. I suggest that this is a time when we should assert that if the expansion of government is not stemmed and reversed the society will quickly lose the strength of the momentum and impetus which comes from individuals and their own exertion. We have drifted away from that principle and we should get back to it.

So often government decisions and legislation proceed on the assumption that all wisdom rests in the government and that the government can best determine what is good for the people, and particularly can determine the best way in which their money should be spent. That has always seemed to me to be a very strange assumption to make because in many cases those doing the directing and the regulating are not involved in what they are controlling and regulating and have had no experience of it at all. I hope, therefore, that if there is one principle upon which we can act in this Parliament it will be to keep the role of government and the extent of its activities under greater control. I am confident that the present Government will have that as one of its guiding principles, but if we do not do so we will one day face the fact that we have more people doing the controlling and regulating, gathering the taxes, spending the taxes and depending on that expenditure than we will have people producing the wealth for all of that to be done. We will then be in a state of irreversible decline and our society will be quite unrecognisable. If that is what we want, then so be it. If it is not what we want we must ensure that government actions and legislation are directed to giving more, not less, impetus and stimulus to the individual.

We will have to make a lot of hard decisions during this Parliament on matters which will raise this basic issue of whether government involvement should be expanded or reduced. I hope that when deciding these issues we will recall the basic principle that the greatest good will come from the greatest scope given to individual effort. Some of the matters with which we will have to deal are perennials, where extensive government involvement is already a fait accompli. In the Budget debate last year the honourable member for Moore (Mr Hyde) mentioned some of those areas of present government involvement in which we should question whether we really want that involvement and control, and certainly whether we want it to the extent that we now have it. I commend that speech to honourable members for close study. It shows that many areas of government activity regarded as Holy Writ and unchallengeable really start to look very limp when subjected to some basic questioning.

One issue that will have to be determined this year is the cost of health care. I hope that we do not merely fiddle around with the present structure. I hope that we make the present system justify itself by reference to basic principle. We should realise in the first place that many people do not want to be insured and do not need to be insured. Unless there are overwhelming reasons to the contrary, they should not be compelled to be insured. To include those people in a universal scheme guarantees an enormous bureaucracy, unlimited expenditure and very little, if any, public benefit for them or for the community at large. The bulk of the population, however, will want to be insured and it will need to be insured. It should take out private insurance with some government involvement if that is unavoidable. The poor should be provided with completely free treatment for that is the obligation of society towards the poor and the disadvantaged who cannot support themselves. Frankly, it would be simpler and cheaper in the long run to pay for their costs outright. I would rather see a plain demonstration of humanity by that means than the vast and cumbrous structure which now embraces us all and which will probably strangle us with its computer printouts if it does not bankrupt us first. It is a terrible indictment of the present scheme that there is apparently under consideration a proposal for higher income earners to pay an extra charge to keep this creaking machine going. The higher income earners are said to be those earning $200 or more. That is surprising, seeing that average weekly earnings are $205.

The second matter to which we will have to draw attention again is the continuous issue of taxation reform. If we do not press on with taxation reform we will find more and more of the productive members of society concluding that their exertion is simply not justified by the rewards. Clearly, the present Government’s taxation reforms were desirable and effective. For instance, I notice that as one of the results of those reforms there is now not the same reluctance to work overtime. I think it is also true to say that there is now a feeling that the taxation burden has been lessened to some extent. All of that is good, but the really productive people in the community- the tradesmen, the professional people, the business people and their employees- are still being wrung dry, and that feeling is encouraged when they see how a lot of their money is being spent.

One could devote an entire speech to this subject of taxation reform but two examples are sufficient to show how the taxation system acts to restrict business initiative and incentive. Let us take a private company which has a taxable income of $100,000 this year. After paying company tax of $46,000, $54,000 will remain. After utilising the retention allowance of 60 per cent, $21,600 remains. The dividends are paid and they will attract personal tax in the vicinity of $12,960 in all probability. So the result is that of the original taxable income of $100,000, the net income, after tax, is $8,640 or thereabouts. If the company has a capital of $400,000 the proprietor has made 2.3 per cent on his investment after tax. That cannot really be described as much of an inducement to stay or indeed to go into business.

The second example relates to excess distribution and the amendments made to the law on that subject in 1976. I have been advised that those amendments were catastrophic for private companies, which are the structure for much of the small business activity conducted in Australia today. The whole argument is set out in the Taxpayer of 25 February 1978. It seems that this clearly was a case of over-reaction to prevent specific tax avoidance. In the course of preventing the abuse, many private companies now have been severely hit once again. I commend that article to honourable members. Here may even be, who knows, one of the solutions to our unemployment problem, or to part of it. If we substantially reduce business taxes it might just be profitable, once again, to employ people, which it scarcely is today in many businesses.

Mr Hodgman:

– That is what the Fifty Cents League said.

Mr N A Brown:

-Indeed. Of course, I give credit to it. We also will have to ask some hard questions about education, particularly tertiary education. I pose the question: Can we afford a completely free system that asks the student to make virtually no contribution at all? Is there no merit at all in a system of student loans- even loans of larger sums, if necessary, than the present Tertiary Education Assistance Scheme allowance- to enable students to lead civilised lives, free from the distractions of money, while they are studying, but to repay that loan when they start earning income? Surely they owe something to the community at large which has paid for them to obtain a qualification which almost guarantees them a higher earning ability and a higher standard of living than those of the community at large. After all, it is the working man himself who now is producing income to pay taxes to pay for, amongst other things, free grants to tertiary students who never return what they have been advanced. Presumably the argument against this is that when they graduate they pay taxes. But the working man, part of whose taxes has been spent in this way, never has it refunded to him.

In the area of social welfare, are we really doing much to encourage self-reliance by the way the social services system is structured, with a claim being made, an examination of the claim, followed by a straight payment of money? Does it achieve anything at all, we should ask ourselves, except to encourage another application and to encourage more people to rely on the same system? This is a question we should be asking particularly about unemployment benefits. Despite the improvements made by the present Government, is the system of virtually automatic and regular payments really the best way of encouraging people to work for their living? Again, I hope that we address our minds seriously to this question. I would not pretend to have the answers to these questions. What concerns me far more than not having the answers is that in many areas such as those I have mentioned we have even stopped asking the questions. Of course, it is much easier not to ask the questions and to keep adding to the same structure of more and more application of government wisdom and government money and more and more diminution of self-reliance.

As politicians we are nudged along in this exercise by the treadmill effect of the lust for popularity which haunts us all. That is just as true of me as it is of other members in this place. We like to go back to our electorates at the end of the week and say: ‘Look how effective a member of Parliament I am. Look at the thousands of dollars I have obtained for your favourite project in the last week. I hope you will remember this when the next election comes around’. That is just as much a vice that contributes to the present system as is any other feature of it. We have become so preoccupied with the need for social welfare and support of one means or another that we find now that there is virtually a social welfare establishment. Like all establishments, it is concerned to entrench itself, to increase the number of clients who are dependent on it and to expand the proportion of resources over which it has control. Like all establishments, it reacts with outrage if any suggestion is made to limit the boundaries of its empire. We have now given such an impetus to the social welfare establishment that we run the risk of encouraging a dependent mentality.

Perhaps it is time to encourage a different view of society and of the nature of the individual in society. Perhaps it is time to suggest that more effort should be directed to encouraging individuals to find their own place in society and that instead of devising means of encouraging more people to rely on the state we should be encouraging more people to rely on themselves. If this is not done, then the mendicant philosophy will overwhelm us all. We should be examining, for instance, why it is that almost every day in this place- at least in my case- we are deluged with reports and surveys of one sort or another on matters of social welfare. They are all very worthwhile, deserving subjects for inquiry. But no one seems to be investigating how the individual can be encouraged to stand on his own feet, to make his own contribution to society and to improve his own material and social position. No reports on that subject land on my desk. We should be examining the subjects of health care, social welfare, education and many of the other sacrosanct areas of government expenditure to see whether there is a better way of achieving the same desirable end- a method of helping those who really need help, yet at the same time encouraging their self-reliance.

Despite the substantial achievements of the present Government in this area- such as its taxation reforms, its encouragement of law reform and administrative review, its encouragement of the individual trade unionist as opposed to the monolothic trade union that tries to dominate him- despite all the reductions in government expenditure and despite the reduction in the size of the Public Service, I hope that during this Parliament we will continue with this as one of our guiding principles: a concern to keep the role and the involvement of government under some reasonable control and, at the same time, to improve and increase the role of the individual citizen in society.


– It is with considerable pleasure that I follow the honourable member for Diamond Valley (Mr N. A. Brown) in this debate. The speech we have just heard from him is the speech of a man who understands the meaning of the word ‘liberal’. It was very much a speech in defence of the pluralist society and of individual choice. I think it advocated policies which, if adopted, will lead this nation to greater aggregate wealth and greater opportunity to provide greater wealth for those who really are needy. The analysis of the taxation system that he presented to the Parliament is relevant to the things that I intend to say. His analysis of the vices of a democratic parliament that always tries to be over-popular, and hang the cost, also is relevant to the remarks I intend to make. In the Economist many years ago some wise soul wrote:

The doctrine of the safety net to catch those who fall has been made meaningless by the doctrine of fair shares for those who are quite able to stand.

We have come no longer to debate whether social welfare ought to be directed to the needy and how we ought to do this, but to take as established the notion that social welfare is a universal right that should be paid to everybody, irrespective of need. If we do this, if we accept it completely and if the present trends continue, inevitably we will pay a dreadful price, and the greatest price will be paid by the most needy. The reasons why the ‘universal right’ approach has been adopted by many- many whose intentions are indeed for the best- are not all unreasonable. They are overwhelmed by more important reasons that argue that we should apply social welfare to need. The dignity of the recipient is probably the most quoted reason for adopting the universal right approach. There are memories of the ‘poor laws’ and of the unnecessary, extreme and hard-hearted discretion that needlessly withdrew the dignity of the recipients of welfare assistance, much of which was in kind. It is not necessary to behave in such a way that dignity is withdrawn if welfare is applied to need. I will come back to that.

There is the political sophistry that government can in some way give the people what it has not first taken from them. That is nonsense. The honourable member for Diamond Valley has dealt adequately with that subject. It concentrates the electorate’s attention on the benefit and does not identify the cost. Governments therefore become popular. They accept the argument of a person that he has paid taxes all his life and is therefore entitled to such and such a benefit, and do not point out that the person can receive that benefit only of he in fact pays even more taxes. Governments take the money out of his left pocket and put it back in his right or vice versa. There are compelling reasons why we must adopt a needs approach and direct our social welfare of all kinds to those who need the succour of the community. Probably the most important single reason is that it is only if we direct public expenditure to those who need it that those who need it will receive sufficient assistance. It is important that we take note of what has happened in countries like Britain which have universal pensions and which have found it necessary to apply a means test so that no less than 2VA has cent of the British pensioners receive another pension- a means tested pension. Britain had to do that because it is the only way in which it could even approach catering for the needs of the needy. No country in the world has managed to provide universal pensons without later going back to means testing at least portion of them.

Mr Holding:

– That is not true.


– I believe that it is true.

Mr Holding:

– You have not looked at the situation in Sweden.


– I have done some research on the matter. Professor Downing -

Mr Holding:

– Look at the situation in Sweden.


– Just listen for a moment. Professor Downing’s research in the Judah Cohen Memorial Lecture, which was a carefully researched paper, stated categorically that that was the case. If honourable members opposite prove me wrong by citing one case in the world, I care not. It will not destroy that argument. The fact is that the overwhelming situation is that it has been found necessary to supplement general pensions with means tested benefits of some sort. A second reason why it is necessary to provide the benefits of the community to those who need them and those people alone is that the additional taxes have a very damaging effect on the needy. Either we take those additional taxes from the rich and poor alike, which is clearly regressive and which will bring about a situation in which we are taxing a large family with modest earnings to provide a pension for a wealthy widow who is quite capable of attending to her own needs, or we tax the rich alone- we would have to tax them at very high levels- in order to hand the moneys back to them. That would remove their discretion and waste considerable effort to what end?

The high taxes destroy incentive. If a government imposes taxes that are too high it will encourage people to rely on the government because the rewards that are left to their discretion are inadequate. Over and above that, because they knew that someone else will do the job for them in like measure to the amount of discretionary income that is left to them, many will say: ‘Why put in the extra effort?’ We ought to ponder why this country’s growth rates are as low as they are. A government removes the rights of people to make decisions for themselves every time it decides that it will take money from them and determine how best to spend that money. The government is in effect saying it should provide a pension for them at such and such a time in life and that they will not have the discretion to decide where and when they will spend it.

Mr Holding:

– Would you apply the same theory to subsidies?


– If I caught the interjection correctly, the honourable member is referring to subsidies to industry. The same argument applies to industry. It so happens that at the moment I am discussing welfare benefits.

Mr Holding:

– What about primary producers? Would you apply the same argument to them?


– I would. The Prime Minister (Mr Malcolm Fraser) indicated before he went to the people the last time, and the time before, that he wished to return discretion to the taxpayer. That is a very liberal philosophy and policy. It prevents the needless formation of a mammoth civil service that is enormously costly to run in order to produce an end which, in the most charitable interpretation of events, would be the same as a taxpayer might produce for himself. But it is far more likely that it will be thoroughly inefficient, not merely because it is cumbersome and large and is a bureaucracy but because the needs of individual people vary enormously. It is not possible to write one set of rules that will meet the needs and desires of each and every one of us. It is far better and more efficient and the nation’s resources will provide far greater succour and joy to the citizens of the nation if they themselves decide how they wish to spend their resources upon themselves. The variety of wants of individual people are extraordinarily wide. Why not leave the discretion with those people?

Mr Holding:

– Because most of the people I represent do not have the money to exercise discretion. That is what the argument is about.


– I have made it perfectly clear that the whole aim is to provide sufficient resources for those people who do not have sufficient money. Interjections like that are inane in that they rest on the notion that governments can produce something out of nothing. There is no way that any government on earth can do that. It is by pretending that that can be done, because it may be politically popular, that the Budgets, of many other countries in the Western world and not only of this country are led into a crisis situation. General principles are of no value unless we can apply them to particular scenes. Applying this general principle to the Australian scene, let us look at what we face inevitably in the near future. We have reason to continue to reduce public expenditure. Let us look at that. We have a Budget deficit in excess of $2,300m. It will almost certainly be somewhat higher than that. That is a substantial proportion, indeed about 2.5 per cent, of our gross domestic product. Last year it was 3.36 per cent of gross domestic product. The figure is coming down, and that is good because many things depend on it.

Let us look at the situation we face in connection with the coming Budget. I am glad that the Treasurer (Mr Howard) is at the table. We have the full year effects of standard rate taxation. No doubt the Treasurer has directed his mind to the problems that that will involve. He will no doubt wish to reduce the Budget deficit further. Amongst other things, the control of interest rates depends upon the control of the deficit. We will wish to control the money supply so that the situation does not become inflationary. Yet we have a problem built into that. No doubt we would make further tax reductions if we could. Some tax reductions are built into things to which we are committed. The biggest cost to revenue will flow from standard rate taxation, but the abolition of estate duty and gift duty will also be costly.

Looking ahead to the next Budget, possibly growth will give us an added advantage of about- perhaps the Treasurer will agree with me on this- $600m. That is not enough. It does not provide the sort of money that is needed. So we will have to look at the area of further reductions in expenditure.

I put it to honourable members that we have no option but to adopt the principle which I outlined in the early stages of my speech. We are not prepared to take away the succour from the needy; therefore we must take it away from those who are not needy- perhaps from the greedy. We cannot afford to ignore the areas of health, education, welfare and welfare housing. Why? It is because they make up 48.3 per cent of expenditure in the Budget? It is too large a portion of the Budget to ignore, particularly when we bear in mind that many other sections of the Budget such as the transfer payments to the States are locked in to the Budget for one reason or another. So we ought to look very carefully at these transfer payments areas and the welfare area- I am using the word ‘welfare’ in its widest sense- to see where we can cut them without hurting the needy.

Do we need universal health care? I think not. That matter has already been dealt with in the debate tonight, so I shall just refer honourable members to the speech by the honourable member for Diamond Valley. Do we need universal free education? Again, I think not, particularly at a time when we have truck drivers, shearers and other people who work with their hands, paying for the higher education of people who, after having completed their education, will lay claim to higher incomes than those taxpayers will ever hope to get. Is it reasonable to tax those people in order to provide benefits for a section of the community that is already among the strongest? Is it sensible not to have a system of tertiary fees? As the honourable member for Diamond Valley said, ought not the Tertiary

Education Assistance Scheme arrangements be loan arrangements? Is it sensible to penalise the parent who sends his child to a private school, but who is poorer than a wealthy parent who sends his child to a public school? Ought pensions to be universal, or ought we to adopt Professor Henderson’s recommendation and maintain the means test on them so that wealthy people do not get the pension and we can thereby concentrate on paying extra pension to the poorer people?

Mr Ellicott:

– Means test the unemployment benefit.


– Yes, ought we to means test the unemployment benefit? Is it sensible to pay unemployment benefit to people who get high incomes for a portion of the year but not for the remaining portion of the year? Is it sensible that someone like myself who comes from a wheat farming background, who can make big money in one year and a loss in the next, ought not to be required to balance his income between years?

Mr Morris:

– Answer some of the questions. Why ask them all?


– The honourable member can answer them. Ought we to go on paying unemployment benefit to those people who are giving the system a working-over? I admit that there is a difficulty in catching up with such people. There is a Budget item of $648m for unemployment benefit. I remember a Press release put out by Senator Wheeldon when he was Minister for Social Security in which he said that 28 per cent of those receiving unemployment benefit were not entitled to that benefit. I repeat: Twentyeight per cent. That is an extraordinarily high figure. Twenty-eight per cent of $648m is a lot of money. If we could catch 10 per cent of those people who were giving the system a working over, the saving would amount to approximately $ 1.8m- a substantial sum. Is it sensible that the people who occupy welfare housing are not among the needy? I think it was Professor Henderson who pointed out that the majority of those in welfare housing were not the poor and that the majority of the poor were not in welfare housing. Should we perhaps be looking hard at means testing the family allowance? These are all possibilities and they are possibilities that would yield the sort of money we would need to write the kind of Budget that would be required so that some sort of stimulus could be achieved in a non-inflationary manner.

Debate (on motion by Mr Willis) adjourned.

page 562


Nuclear Industry- Parliament House: Security- The Parliament- Wine Industry- Australian Taxation Office -Unemployment

Motion (by Mr Howard) proposed:

That the House do now adjourn.


-This week a British Government inquiry recommended that a major nuclear fuel reprocessing plant should be built at Windscale. The Australian people and the Parliament should be quite clear about the implications of this recommendation and the circumstances surrounding it. Firstly, the decision of the inquiry was made primarily for commercial reasons. British Nuclear Fuels Ltd has acknowledged the decision as ‘a complete vindication of our proposals ‘. These proposals, in fact, are based on an interest in $ 1,500m worth of nuclear fuel reprocessing contracts from Europe and Japan. As elsewhere, commerical interests take priority in the nuclear industry. As far as Australia is concerned, this recommendation is another nail in the coffin of attempts to control the spread of plutonium and the potential to make nuclear weapons. If the inquiry’s recommendation is accepted by the British Government, it will undermine current attempts to assert multilateral control of the dangerous aspects of nuclear power.

The International Nuclear Fuel Cycle Evaluation still has several years to run before firm conclusions are reached about methods to prevent the spread of nuclear weapons via the nuclear energy industry. The Australian Government, as the Minister for Foreign Affairs (Mr Peacock) indicated in answer to a question without notice last week, is placing great faith in the outcome of these talks. The evaluation was proposed as a part of President Carter’s attempts to discourage uranium reprocessing. Clearly, any British decision to go ahead with this part of the nuclear fuel cycle will seriously undermine whatever goodwill and good intentions remain in regard to the strengthening of nuclear safeguards. The evidence presented to the Windscale inquiry illustrated just how serious a problem is posed by the so-called ‘peaceful’ nuclear industry.

The major fuel reprocessing plant in Britain makes a mockery of the Australian Government’s so-called safeguards policy. It will be simply impossible to enforce a policy of granting prior approval for reprocessing for specific uranium export contracts under these conditions. The Australian Government policy simply will not work. The technical circumstances surrounding the possible establishment of a nuclear fuel reprocessing plant in Britain are also serious. High level radioactive waste is produced in large quantities from such plants- 14.5 cubic metres per annum from a single 1,000 megawatt reactor. But the disposal of that waste is still an unresolved problem. In no country- I stress the words ‘in no country’- is the proposed waste containment method- vitrification- in operation on a commercial scale as the Prime Minister boasted. At this stage only laboratory experiments have been carried out; it has not been done on a large scale. We know that in the United States alone there are 74 million gallons of liquid toxic waste which cannot be reprocessed and which cannot be controlled. If a country such as the United States with its enormous wealth cannot solve the problem it will be very difficult for others to do so.

Just last month two scientists from the United Kingdom Atomic Energy Research Establishment, Dr Feates and Dr Keen, wrote: ‘Ten years of research will be needed before we have enough information on any specific site to propose a pilot-scale trial of a disposal system’. That is, even if fuel reprocessing goes ahead, even if vitrification can be made to work, there is still no guarantee that a safe dumping ground exists in Britain to dispose of the radioactive waste from the reprocessing plants. Australia cannot and must not be misled by the recommendation of the Windscale inquiry. It does not provide any justification for uranium exports. We on this side of the Parliament will maintain our opposition to the nuclear industry, surrounded as it is with unresolved environmental and security problems.

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


-Last night during the adjournment debate two honourable members opposite spoke on two topics to which I wish to refer. The first matter was that of security, which was mentioned by both the honourable member for Wills (Mr Bryant) and the honourable member for Melbourne Ports (Mr Holding). I can appreciate their concern at the fact that some form of security is being implemented at the Parliament because they might be prevented from entering this building at some stage. Let us look at the real situation. The honourable member for Melbourne Ports said that honourable members on this side of the House might be concerned that they could be shot or blown up. He was obviously assuming that nobody would bother to do that to honourable members opposite. The honourable member for Wills said that there are enough attendants working in the building for us not to have to worry about security. Both honourable members completely overlooked the fact that the staff working in this building are just as important and need just as much security as honourable members.

I remind those two honourable gentlemen that it was not the members of the conference visiting the Hilton Hotel who suffered; it was the staff of the hotel or people carrying out work in the precincts of the hotel who suffered as a result of the stupid act that occurred at that time. Such an incident could well happen here. If we take some measures to show that we are concerned, I think the Government, and I hope the majority of members of the Opposition, would be seen to be acting in a sensible manner by at least acknowledging that we are not, as the honourable member for Wills likes to mention, still living in an atmosphere which was relevant 20 years ago. It is 1978 and, as the Prime Minister (Mr Malcolm Fraser) has said and as many other people have said, Australia has now unfortunately entered an era in which terrorism is rearing its ugly head.

Another matter that was raised last night concerned parliamentary procedures and the lack of opportunity for debate. That is a matter of circumstance from which I am sure all of us have unfortunately suffered. It is one of the facts of life in this Parliament that we tend to try to put through too much legislation in the short amount of time available to us. But that has occurred not only under the administration of this Government. Let me refer honourable members to the time when Fred Daly was the Leader of the House. He boasted openly that he had put through more Bills in any one year than had any other government. Of course, that was the case. He gagged every debate. As soon as a member of the Opposition- we were in opposition on that occasion- tried to speak on a piece of legislation he was gagged.

Now the honourable member for Wills is making some lame duck complaint because I happened to gag him. Let me just explain the reason he was gagged yesterday. Because of the time that was available and because of an agreement made between the Whip of his Party and myself, only a limited number of speakers from each side were to take part in the debate. The Opposition Whip always tries to keep to such agreements because he is an honourable member of this Parliament. The agreement was made in the best interests of those who wished to speak. Three Opposition members had the opportunity to speak in the time which was normally allocated to one speaker. The arrangement was made by courtesy of the Opposition Whip, and I was happy to accept this. Now we have the honourable member for Wills, who is one of the rebel back benchers, making abusive remarks about me.

Mr Bryant:

– You villain!


– The honourable member for Wills is unfortunately in a geriatric situation. We on this side of the House will be sorry to see him being forced to leave the Parliament in the next few months in order to make way for his old arch enemy Bob Hawke. We know it is on; we have been told. We have received confidential information. I was sorry to hear it, because despite the way in which he attacks me, I rather like the benign old geriatric.


-Order! I call on the honourable member for Bendigo to withdraw that remark.


-I am sorry, Mr Deputy Speaker. I withdraw. He is not a geriatric. He is a benign old gentleman. He is so befuddled these days it is a tragedy. During the election campaign he went to Maryborough, which is situated in the electorate of Ballarat to campaign for the Labor candidate. He forgot which electorate he was in and he attacked me in spite of the fact that I represent a different electorate altogether. When the people of Maryborough read about that they said: ‘Good Lord, is this the best the Labor Party can do- to attack a bloke who is not even a candidate for this area’. The result was that Jim Short increased his majority and won the seat of Ballarat which is normally a Labor stronghold. That will now become a Liberal Party seat, thanks to the honourable member for WillS who is one of our greatest helpers. Every time he opens his mouth he helps us. I will be genuinely sorry when Bob Hawke replaces the honourable member for Wills. I will be sorry to lose him for many reasons.

We will be sorry to lose him, even though he interrupts debates, even though he jumps up and speaks at every opportunity. Fred Daly once said to me: ‘He is the only member on this side I cannot shut up. He would speak under wet cement’. We on this side of the Parliament are well aware of that fact. We like the old fellow. He is not a bad bloke. We will be terribly sorry to see him replaced. I did not take offence at the remarks he made about me last night because he knows that, in trying to allow as many honourable members as possible a chance to take part in the debate, I was merely carrying out my duties as Government Whip.


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


-This evening I want to register my strong personal objection to the so-called security measures adverted to just a few moments ago by the Government Whip, the honourable member for Bendigo (Mr Bourchier). I believe that the imposition of these measures is part of a political stunt organised by the Prime Minister (Mr Malcolm Fraser). I believe that the measures reflect his obsessional personal fears for his own safety.

Mr Howard:

– Ha, ha!


– He does not think it is a laughing matter. He has conducted himself as probably the most confrontationist politician in the history of this Parliament. If his actions attract attention to himself, that is to be understood. What I want to know is how much he has influenced the Presiding Officers of both Houses of this Parliament in the measures which have been brought down? Has pressure been brought to bear by the Prime Minister? I think these questions ought to be answered by the Prime Minister at a later date. We as members of Parliament were not consulted- at least honourable members on this side of the House were not consultedabout the proposed measure. We were not advised, nor have we seen any evidence of so-called terrorist activities in relation to this building.

I wish to refer specifically to an article which appeared in yesterday’s Melbourne Herald entitled ‘Terror comes to Canberra’. I ask again: Where is the evidence to support the contention that terror has come to Canberra? Many honourable members in this chamber feel that from time to time the occupant of the canopied chair in this chamber is the main terror. But where is the evidence to support the sort of headline which reads: ‘Terror comes to Canberra’. The opening paragraph of the article reads:

About 10 years ago an attendant noticed an old car at the front steps of Parliament House, with its engine running.

The article goes on to relate an incident involving a chap who wanted to come into the Parliament and make some remarks. The article goes on to say:

Another time a man jumped out of the gallery on to the floor of the chamber just before 8 p.m. and just as the Sergeant-at-Arms was entering.

That must have occurred at least five years agobefore I entered the Parliament. The first incident occurred 10 years ago and the second incident must have occurred at least five years ago. A third incident refers to a member of the Press Gallery. The article goes on to say:

His entry on to the floor of the House was almost identical to a journalist a few years earlier. He leaned over the gallery too far and fell!

They are very serious matters which warrant the kind of security measures and the infringement upon the rights of members of this Parliament and of Australians to enter the parliamentary building in the course of their normal activities, that we are now witnessing. I ask again: Where is the evidence? There is no evidence. All we have is the Prime Minister’s personal obsession with his own safety.

It is said that Parliament is often a theatre; maybe that is true. Let us have a look at the first incident after these so called security measures were announced. A bundle of papers fell from the Press Gallery. It was an infringement within the chamber? What happened? Government supporters laughed. They thought it was a joke. Maybe it was a try-out. I do not know whether the journalist concerned was questioned. The papers may have contained a bomb destined for someone in the House; we do not know. This shows the absurdity of the kinds of things advanced in this article. The article and the measures which have been taken are a farce. Let us go back a few months to the night that the lights went out in Parliament House when the Liberals were in government. For more than half an hour Parliament House was in darkness. Anything could have happened. Are we to guard all the electricity sub-stations around Canberra to prevent the lights from going out whenever a Liberal government is in power? Where is the sensibility? Where is the evidence for the necessity to take the kind of measures that are being taken? Access to the Parliament and to members of the Parliament is a fundamental right of every Australian. It is a fundamental right of every parliamentarian and his staff to be able to move about this building.

I received a circular, as no doubt other honourable members did, from a Mr Evans asking me to sign a form to enable my staff to be issued with a pass. I do not propose to sign the form. I do not believe the measures should be brought into existence. Again there is no evidence. I keep raising that question over and over again: We are part of a political stunt by the Prime Minister. The previous speaker, the honourable member for Bendigo, mentioned the

Hilton incident. Where is the evidence which relates the Hilton incident to meetings in this chamber? There is none. Again it is capitalising on a tragic event which affected the lives of Australians. It has nothing whatsoever to do with this Parliament unless it involves the Prime Minister himself. The measures are an invasion of the rights of members of this place, and making this Parliament a fortress spectacular will do one thing: It will attract the nuts, the crackpots, the cranks and the misfits who know that any kind of an event -

Mr Baume:

– There you are.


– They all sit opposite and constitute 86 in number. These measures will attract their comrades from outside who will take some silly action outside Parliament House because they will be guaranteed publicity.

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


-Vignerons in the Hunter Valley will suffer from a very large surplus of wine grapes, contributing substantially to the Australia-wide surplus which will probably exceed 50,000 tonnes. This means that vignerons will be unable to dispose of grapes worth approximately $4m. There has been an unexpected swing from red to white wines, although many white grapes will be included in the surplus. However, the major part of the problem can be found in government policy.

Until various Governments began to tinker with it, the wine industry was able to deal with its own problems without crying for help. Because of section 31a of the Income Tax Act, winemakers had sufficient liquidity to buy grapes even when they were surplus to immediate requirements. Some of these grapes were made into brandy, which had a ready market before excise was increased by an incredible 231 per cent. Wine prices were stable in relation to inflation, ensuring a healthy growth rate.

Today the wine industry is burdened with the need to pay off its huge deferred tax obligation. The market for Australian brandy has been eroded by big imports of cheap foreigns brands with which it must now compete. Wine makers are selling off young wines to pay off the most urgent bills, and attempting to recover some funds by increasing wine prices in the market place. All of this is almost entirely due to some ideological insistence that all must be taxed on the same basis. It is not even achieving this. Winemaking is not a true secondary industry, to be taxed like all other secondary industry.

Section 3 1a was simply a system of providing winemakers with the same essential tax treatment received by every primary industry in one form or another. Winemaking is so closely linked with primary industry that in all fairness it must be treated as such. I therefore ask that the Government carefully re-think its position on this problem, and quickly, before those communities so heavily dependent on grapegrowing and winemaking are totally destroyed. The picking of grapes is very labour-intensive. The wine industry exists throughout various parts of Australia. I believe that the Government should have a look at the matter and give justice to the industry otherwise, as I have mentioned in this short speech, it will go out of existence.

Mr Les McMahon:

– I am pleased that the Treasurer (Mr Howard) is in the House tonight to hear this most important case which I am about to put. The matter deals with a constituent in my electorate and the Australian Taxation Office. The constituent involved is 88 years of age. He has had a bit of trouble with the Taxation Office. His name is Mr Gibbons. He turned 88 years of age on 6 March, two days ago. Last Friday he left the Prince Henry Hospital after an eight days’ stay due to falling in the house in Glebe where he is living. Mr Gibbons has been very absent minded in his old age. Like many old people he has a tendency to forget things. He needs constant supervision by his family. I am pleased to say that his family has not asked him to go into a nursing home. It is looking after him.

He had some trouble in December with a tax cheque. In addition to his pension he receives a certain amount of money from the Workers Compensation Board in Sydney for a dirt disease. He is receiving approximately $160 per fortnight. His son-in-law helped him to fill in his tax assessment form. For some reason he did not include the pension which he receives. To his good luck, just before Christmas he received a tax cheque for $530. Not having had a holiday for many years he thought it would be handy to have one. Because he is 88 years of age he took his son away with him. He went to the Gold Coast. He had a good time and enjoyed himself. When he came home he was told that the Taxation Office had made a mistake and that he had to give back the $530 plus $230 because he had made a wrong statement in regard to the amount of money he was then receiving. Mr Gibbons has been very sick. His son-in-law saw me. He was a bit worried about his father-in-law because his father-in-law had been upset during the past couple of months. His father-in-law did not usually drink, but he had had a few drinks lately. He had been trying to calm himself down. He had to see a specialist doctor.

I took up the matter with Mr Gray of the Taxation Office in New South Wales. I told him that the man was willing to pay back the money at the rate of $4 a fortnight. It was pointed out that he would be 103 years of age before he paid it off. We had a discussion with Mr Gibbons. He said that he would pay $20 a fortnight. While this was happening correspondence was received stating that Mr Gibbons’ wages would be garnisheed Forty dollars a fortnight is to be taken out of the money he is receiving. Correspondence that I have shows that he is not receiving $300 a fortnight. Tax has to be deducted from that and he has to pay for health insurance. He has lost his telephone concession and his card which gave him certain transport entitlements. The man is very sick. He has just come out of hospital. I hope that the Treasurer will take up the case. I will talk to him afterwards. I hope he will do what he can. The man does not have any money. He had a few dollars and he went out and enjoyed himself. I am pleased to be able to say that his family is looking after him. As I said earlier, they have not sent him to a nursing home. He is trying to live the life that he has always enjoyed. I hope that some benefit will flow from what I have said. I was upset that the Taxation Office stated that it would garnishee his wages without telling me first. In other words, the Taxation Office said that it would garnishee his wages, which amounted to $40 a fortnight, without telling the Federal member of parliament who was handling his case. I believe that the Taxation Office is doing these things only to the little people. Other people can get away with it.


Order! The honourable member’s time has expired.


– I noticed in this afternoon’s Melbourne Herald a news item which I feel ought to be drawn to the attention of honourable members. It appeared on page 3. 1 will read it verbatim:

The number of Australians out of work fell last month by 44,000 a private consumer research organisation has found.

The organisation said the number of “full-time unemployed “in February was 328,000.

The survey conducted by the Roy Morgan Research Centre Pty Ltd., which also conducts the Gallup Poll, found that falls were recorded in all age groups.

The findings were the results of four evenly spaced surveys during February in which information was obtained from 1 1,000 people questioned.

It is expected that these trends will be reflected also in the Commonwealth Employment Service figures due later this week.

The managing-director of the Roy Morgan Research Centre Pry Ltd., Mr Garry Morgan, said today: “It is expected that the CES figures for February will fall about 20,000 to 30,000.”

However, he points out that the Australian Bureau of Statistics is expected to report an increase because it did not survey in December -

I query why not - . . . and January when the unemployment pool rose because of school-leavers.

In a statement issued with the results of the survey, Mr Morgan is critical in the way in which the CES figures are used to measure unemployment each month.

He describes them as misleading because persons, registered as unemployed, do not have to notify the CES when they have a job, thereby inflating the situation. “People can be registered for a full-time job while working part-time, “ he said.

The Morgan index showed that the 121,000 unemployed last month, aged over 24, was the lowest for six months. Last month, the number was 156,000.

Those aged between 14 and 24, who were out of work, totalled 207,000-down 9000 on February’s figures.

This is not the first time that a major discrepancy has been brought to the attention of this Parliament between the figures collected by a private research organisation, the figures collected by the Commonwealth Employment Service and the figures produced by the Australian Bureau of Statistics. The significant point is that, despite the prophecies of doom which have been paraded in this House during the last fortnight by members of the Opposition, the unemployment level is falling. That is confirmed not only by the figures of the Roy Morgan Research Centre Pty Ltd but also by the figures of the Commonwealth Employment Service. I believe that to a large extent this vindicates those of us who have contended that if people were prepared to give the Government’s policies some time to work a result would be achieved and the unemployment level would continue to drop.

It is not surprising that the news that the unemployment level is dropping will come as a shock to members of the Australian Labor Party. When the Whitlam Government was in power it created the highest unemployment in this country since 1930. Since 1975, honourable members opposite have paraded permanently as prophets of doom, jeremiahs, whingers and scaremongers putting fear into the unemployed and particularly the young unemployed. I have complained in the House on many occasions about people using the unemployment situation as a political football. I suggest to those members of the Labor Party who have repeatedly tried to frighten young people who are endeavouring to get employment that they ought to pay a little attention to the figures and give a little encouragement to those people who are presently out of work and who want work and will be looking for work in the near future. Instead of knocking, whingeing, fear mongering and scaremongering, honourable members opposite should speak during the next few weeks in praise and support of the community youth support scheme, the special youth employment training program and the fact that apprentice training allowances were increased three weeks ago. I wonder how many honourable members opposite have told the young people in their electorates of that situation. Honourable members opposite ought to act constructively to get young Australians into jobs.

I congratulate the Roy Morgan Research Centre Pty Ltd. I noticed some laughter from honourable members opposite when I cited its figures. I did not notice such laughter when the gallup poll figures indicated certain things which supported the Labor Party a few months ago. Either Mr Morgan’s organisation is corrupt or the figures are correct. If the figures are correct, we are starting to win the battle against unemployment. I hope that in the weeks ahead we will not hear honourable members opposite trying to drum up unemployment as an issue for purely political purposes. High unemployment is something which they created and we cured. It would help us a lot if they assisted us in repairing the damage that the Whitlam Government created from 1972 to 1975.

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member’s time has expired. I call the honourable member for Melbourne Ports.

Melbourne Ports

-Mr Deputy Speaker -

Mr Yates:

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


– Oh, no!

Mr Yates:

– I will not take up the honourable member’s time; he need not worry. I strongly object to the fact that although the honourable member for Denison was not in the House when you were looking to catch the eye of the honourable members who wished to speak in the adjournment debate you did not give me the call but gave the call to him.


– There is no substance to the point of order.


– I want to extend the argument I put to the House in the adjournment debate last night in terms of the political hysteria that is being whipped up in this community. It was commenced by the Prime Minister (Mr Malcolm Fraser). No one in this House can support the unfortunate incidents that occurred at the Hilton Hotel. But equally I for one will not sit back and allow the Prime Minister or the Speaker of this House to use that incident to erode an institution of this nation. I am referring to this Parliament. I refer to an article that appeared in the Herald newspaper. I suppose that the Speaker of this Parliament has rights as a member of Parliament. If he wants to write an article for the Herald or any other journal as a member of this Parliament that is his right. But I have the strongest objection when he writes a partisan political article which appears under his name as the Speaker of the House of Representatives. He talks about terror coming to Canberra. Where was the terror? He talks about a couple of cranks on a couple of occasions ten years ago. I do not regard that as an appropriate set of circumstances and I do not believe it is appropriate for a Speaker of this House.

More important than that, having led with this sort of palpable political nonsense, the Speaker- a man who is supposed to be above the politics of this place- then enjoins the community to accept the argument that because of the incidents that took place at the Hilton Hotel we as a community ought to accept the fact that the security service of this nation- the Australian Security Intelligence Organisation- is entitled ‘to gather intelligence knowledge about any person who may become a threat’. He did not refer to any person who was a known or suspected terrorist. He referred to any person who may become a threat. I have pointed out to the Speaker of this House my concern about the fact that the Australian Security Intelligence Organisationthis is clearly the case from the evidence collected by Mr Acting Justice White- regarded every member of the Australian Labor Party in every parliament of this nation as a potential threat and had collected dossiers on them. I am bound to say that some real progress might have been made in apprehending the culprits in respect of the Hilton Hotel outrage if our security organisations had been doing their job instead of acting as professional snoopers on people who are concerned to express their rights as citizens in the community and take political positions and attitudes which do not necessarily agree with those of the government of the day or the people who adopt the standards that apply in ASIO.

Mr Howard:

– That is a totally unwarranted attack. “*


– Let me tell the Treasurer that the people of my electorate know a bit about terrorism because -

Mr Carlton:

– I am not surprised.


– The people whom this Government and its predecessors supported- I am referring to members of the Ustashaplanted a pencil bomb in the Richmond Town Hall some 12 years ago. It blew a hand off a child. A bomb is planted in the Yugoslav Embassy once every two years. Less than six months ago -

Mr DEPUTY SPEAKER (Mr Millar)Order! It being 1 1 p.m., the debate is interrupted. The House stands adjourned till 10.30 a.m. tomorrow.

House adjourned at 11 p.m.

page 569


The following answers to questions upon notice were circulated:

Review of Passports Procedure (Question No. 1)

Mr Jacobi:

asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

  1. 1 ) Has an interdepartmental committee been established to review the procedure for the issue of passports taking into account the danger of child abduction (Hansard, 8 November 1977,page3133).
  2. If so, (a) when was it established, (b) which departments are members of it, (c) what are its terms of reference and (d) when is it expected or required to report.
Mr Peacock:
Minister for Foreign Affairs · KOOYONG, VICTORIA · LP

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

Following a review by my Department of the problems associated with the issue of passports, an interdepartmental committee met in June, last year to consider recommendations made by the Department. The review was wide ranging covering the Passports Act and Regulations and other relevant legislation as well as the administrative procedures relating to the issue of passports. The incidence of child abduction was one of the matters considered by the Committee.

Departments who participated in the interdepartmental committee were Attorney-General’s, Business and Consumer Affairs, Health, Immigration and Ethnic Affairs, Administrative Services (Commonwealth Police), ASIO, Prime Minister’s and Cabinet and Home Affairs.

I expect that I shall soon be in a position to provide details of the recommendations arising from this review.

Advertising Expenditure (Question No. 33)

Mr Les Johnson:

asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

  1. 1 ) What sum was spent by his Department on advertising and services during the period (a) 1 1 November 1975 to 13 December 1975, (b) 14 December 1975 to 30 June 1976, (c) 1 July 1976 to 30 June 1977 and (d) 1 July 1977 to date.
  2. What was the cost of each campaign undertaken.
  3. Under which item of expenditure were funds allocated.
  4. Which advertising agencies or consultants were used for each campaign.
  5. What was the total sum paid to each agency or consultant for each campaign.
  6. How was each agency or consultant selected.
  7. What is the estimated cost of advertising and promotion of Government programs and services for 1977-78.
Mr Peacock:

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

  1. (a)$361;(b) $1,081; (c) $10,499; (d)$16,651.
  2. The Department conducts a continual campaign for the recruitment of staff. The cost of advertising in relation to staff recruitment during the period 11 November 1975 to date was $28,592.
  3. Division 315/2/13- Department of Foreign AffairsIncidental and Other Expenditure $24,885. Division 318/2/06-Department of Foreign Affairs- Australian Development Assistance Bureau- Incidental and Other Expenditure $3,707.
  4. Advertising was arranged through the Australian Government Advertising Service.
  5. All payments in respect of advertising were paid to the AGAS.
  6. Advertising was lodged with agencies by the AGAS in accordance with its normal practices.
  7. The estimated cost of advertising in the 1977-78 financial year is $29,500.

Transport between Tasmania and Mainland (Question No. 106)

Mr E G Whitlam:

am asked the Minister for Transport, upon notice, on 22 February 1 978:

What recommendations did the interdepartmental committee make on the outstanding issues in the report of the Royal Commission into Transport between Tasmania and the mainland of Australia presented on 5 March 1976 (Hansard, 26 October 1977, page 2459).

Mr Nixon:

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

The interdepartmental committee has not yet forwarded its recommendations. As is normally the case interdepartmental reports are confidential to the Government. When received the interdepartmental report will be considered by the Government and if appropriate an announcement of any decisions taken will be made in the usual manner.

Spratly, Paracel, Kurile and Senkaku Islands: Claimants and Jurisdiction (Question No. 118)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

Which governments now (a) claim and (b) exercise jurisdiction over the Spratly, Paracel, Kurile and Senkaku Islands. (Hansard, 26 October 1 97 1, page 2555).

Mr Peacock:

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

  1. Spratly Island: Current claimants to the Spratly Islands or part thereof are believed to be Vietnam, the Philippines and the People ‘s Republic of China. Vietnam and the Philippines maintain military garrisons on separate islands of the Spratly group.
  2. Paracel Islands: Current claimants are believed to be the People’s Republic of China and Vietnam. The People’s Republic of China maintains a military garrison on Paracel Islands.
  3. Kurile Islands: The Soviet Union claims, occupies and exercises jurisdiction over the Kurile Islands, which it is understood to interpret as including Kunashiri and Etorofu Islands and Shikotan Island and the Habomai group. Japan claims these four are historically and legally Japanese territory.
  4. Senkaku Islands: Current claimants to the Senkaku Islands are believed to be Japan and the People’s Republic of China. It is understood the Senkaku Islands are normally uninhabited, but have been patrolled by Japan in the past.

The regime on Taiwan is believed to be a claimant to the Spratly, Paracel and Senkaku Islands and maintains a military garrison on an island in the Spratly group.

In providing this information, the Government takes no stand on the merits of or the current position in respect of any of the above claims.

Covenant on Civil and Political Rights (Question No. 120)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

Will he bring up to date his answer on the steps being taken to ratify the 1966 International Covenant on Civil and Political Rights which entered into force on 23 March 1976 (Hansard, 8 December 1 976, page 3,560).

Mr Peacock:

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

  1. There have been consultations with the States since December 1976 on the implementation in Australia of the International Covenant on Civil and Political Rights. Further consultations will be necessary before a final decision is taken on ratification of the Covenant.
  2. Since December 1976 the following States have ratified the Covenant: Guinea (24 January 1978); Guyana (15 February 1977); Panama (8 March 1977); Poland (18 March 1977) and Spain (27 April 1977).

Reciprocal Enforcement of Custody Orders (Question No. 122)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

Which countries has Australia approached with a view to concluding arrangements for the reciprocal enforcement of custody orders.

Mr Peacock:

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

The following countries have been approached with a view to ascertaining their attitude towards entering into reciprocal arrangements with Australia for the recognition and enforcement of custody orders:

Argentina, Bangladesh, Canada, Chile, Cyprus, Egypt, Eire, France, Germany (F.R.G.), Greece, Hong Kong, India, Italy, Malaysia, Malta, Netherlands, Pakistan, South Africa, Spain, Sri Lanka, Sweden, Turkey, United Kingdom, United States of America, Uruguay, Yugoslavia.

The Family Law Act 1975 and the Family Law Regulations enable custody orders originating in New Zealand and in Papua New Guinea to be registered in Australian courts and thereby to acquire the same force and effect as if they were custody orders of the Family Court of Australia.

Extradition Arrangements (Question No. 124)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

With which further countries has Australia negotiated extradition arrangements since 24 February 1977 (Hansard, page 507) (a) of general application or (b) to implement the Convention for the Suppression of Unlawful Seizure of Aircraft.

Mr Peacock:

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

Since 24 February 1977 Australia has negotiated extradition treaties with Denmark, Finland, the Federal Republic of Germany and Norway. The texts have been initialled but not signed. All four treaties will be of general application and the offences which will be extraditable will include the offences prescribed in the Convention for The Suppression of Unlawful Seizure of Aircraft.

Agreements for Scientific and Technical Co-operation (Question No. 126)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 1 9 April 1977:

Which countries have (a) approached or (b) been approached by Australia with a view to negotiating an agreement for scientific and technical co-operation (Hansard, 19 April 1977, page 1002).

Mr Peacock:

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

Australia has concluded agreements for scientific and technical co-operation with the following countries:

USA (1968) USSR (1975)

India (1975)

Federal Republic of Germany ( 1976)

Of these the USSR and the FRG were approached by Australia and India and the USA approached Australia.

In addition, Australia has concluded cultural agreements which contain specific undertakings to promote and encourage the development of bilateral contacts in science as well as in other fields. These agreements have been made with France, Indonesia, India, the Republic of Korea, Thailand, USSR, Italy, Iran, Singapore, Malaysia, Yugoslavia, Philippines and Romania (signed but not ratified).

Australia has also been approached formally by the German Democratic Republic with a view to concluding an agreement for scientific and technical co-operation From time to time various other countries have raised with Australia the possibility of a scientific agreement but no draft agreements have been presented by either side for discussion.

The honourable member may be aware that at the Prime Minister’s direction, a group of officials is examining policies for Australian Government involvement in international scientific and technological activities particularly with regard to whether Australia should enter into further bilateral scientific and technological co-operation agreements with other countries. It is expected that this group will shortly produce its findings.

Comprehensive Reciprocal Agreements on Social Security (Question No. 128)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

With which further countries has Australia negotiated comprehensive reciprocal agreements on social security since 22 February 1977 (Hansard, page 33 1 ).

Mr Peacock:

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

Australia has not concluded any comprehensive reciprocal agreements on social security since 22 February 1 977.

Reciprocal Agreements on Medical and Hospital Care (Question No. 129)

Mr E G Whitlam:

am asked the Minister for Foreign Affairs, upon notice, on 22 February 1978:

Which countries has Australia approached with a view to negotiating agreements for the reciprocal provision of medical and hospital care (Hansard, 24 February 1977, page 508).

Mr Peacock:

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

Australia has not approached any country with a view to negotiating agreements for the reciprocal provision of medical and hospital care.

Outpatient Charges (Question No. 184)

Mr Les Johnson:

asked the Minister for Health, upon notice, on 22 February 1978:

  1. 1 ) Did the Prime Minister receive a deputation from the Pharmacy Guild of Australia during the latter pan of 1977 when a proposal was made for reintroduction of a patient contribution at hospital outpatient departments to cover both medical consultations and pharmacy supply, equivalent to the pharmaceutical benefits surcharge of $2 per item.
  2. What additional revenue would result from implementation of this proposal.
  3. Would reintroduction of outpatient charges disadvantage low income patients and include persons who at present receive emergency treatment without charge.
  4. Is the Government still considering the implementation of the proposal put by the deputation; if so, when can a decision be expected.
Mr Hunt:

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

  1. Yes.
  2. The Australian Capital Territory and three States, New South Wales, Victoria and South Australia currently impose charges on privately insured persons attending recognised hospital outpatient units. These charges are made on an ‘all-inclusive’ basis and cover the provision of any necessary medical, paramedical or nursing services, supply of drugs, etc.

The other three States and the Northern Territory have thus far chosen not to introduce outpatient charges. At the present time information is not available that would enable an estimate to be made of the likely revenue that would result from the introduction of a $2 surcharge on pharmaceutical items supplied by outpatient departments.

  1. This would of course depend on the nature of the charging arrangements that were introduced. Existing outpatient charges are raised only on fully privately insured persons, and full hospital benefits coverage of the charge is therefore available in all cases. However, to place the supply of drugs from outpatient units on the same charging basis as supply from private pharmacists, the outpatient charge would need to be levied on all patients (except pensioners). Those patients not privately insured would not be able to recover their costs through a health insurance organisation. The question of what charges should be raised for nonpharmaceutical benefit items would need to be explored, as full charges for such items could represent a heavy financial burden for uninsured, low income patients. On the matter of emergency treatment, the submissions made to the Prime Minister by the Pharmacy Guild suggested that free outpatient services should be available in emergency cases, with a limit of 24 hours free coverage.
  2. The matter is currently under examination by my Department, but the honourable member should understand that this is not an issue for unilateral ‘decision’ by the Commonwealth Government. The State governments are responsible for the operation of their recognised hospitals and whether or not outpatient charges are to be made, the level and scope of any such charges, etc., are matters for decision by the State Governments. The Commonwealth Government’s role in these matters is limited to discussing with the States the desirability or otherwise of outpatient charges and if appropriate, to concurring under the cost-sharing agreements with decision reached by the States.

The only area in which the Commonwealth Government could act unilaterally on this matter would be in respect of recognised hospitals in the Australian Capital Territory and the Northern Territory. I believe it would be undesirable to introduce new charges in territorial hospitals without first fully exploring with the State governments the desirability or likelihood of similar charges being introduced on a more general basis.

Cite as: Australia, House of Representatives, Debates, 8 March 1978, viewed 22 October 2017, <>.