House of Representatives
25 September 1979

31st Parliament · 1st Session

  1. House of Representatives
  2. 31st Parliament
  3. 1979

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

page 1451

PETITIONS

The Clerk:

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

Education

To the Honourable, the Speaker and Members of the House of Representatives, of the Australian Parliament assembled. The petition of certain citizens of NSW respectfully showeth:

Dismay at the reduction in the total expenditure on education proposed for 1980 and in particular to Government Schools.

Government Schools bear the burden of these cuts, 1 1.2 per cent while non-Government schools will receive an increase of 3.4 per cent.

We call on the Government to again examine the proposals as set out in the guidelines for Education expenditure 1980 and to immediately restore and increase substantially in real terms the allocation of funds for education expenditure in 1 980 to Government schools.

And your petitioners as in duty bound will ever pray. by Mr Lionel Bowen, Mr Cadman, Mr Howard, Mr Hunt, Mr Les Johnson, Dr Klugman, Mr Morris, Mr 0’Keel e and Mr West.

Petitions received.

Metric System

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

That the plan to obliterate the traditional weights and measures of this country is causing and will cause widespread inconvenience, confusion, expense and distress.

That there is no certainty that any significant benefits or indeed any benefits at all will follow the use of the new weights and measures.

That the traditional weights and measures are eminently satisfactory.

Your petitioners therefore pray:

That the Metric Conversion Act be repealed, and that the Australian Government take urgent steps to cause the traditional and familiar units to be restored to those areas where the greatest inconvenience and distress are occurring, that is to say, in meteorology, in road distances, in sport, in the building and allied trades, in the printing trade, and in retail trade.

That the Australian Government request the State Governments to procure that the imperial and metric systems be taught together in schools.

And your petitioners as in duty bound will ever pray. by Mr Aldred, Mr Burns, Mr Fife, Mr Jarman, Mr Nixon, Mr Peacock and Mr Shipton.

Petitions received.

National Women’s Advisory Council

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

That the National Women’s Advisory Council has not been democratically elected by the women of Australia;

That the National Women’s Advisory Council is not representative of the women of Australia:

That the National Women’s Advisory Council is a discriminatory and sexist imposition on Australian woman as Australian men do not have a National Men’s Advisory Council imposed on them.

Your petitioners therefore pray:

That the National Women’s Advisory Council be abolished to ensure that Australian women have equal opportunity with Australian men of having issues of concern to them considered, debated and voted on by their Parliamentary representatives without intervention and interference by an unrepresentative ‘Advisory Council ‘.

And your petitioners as in duty bound will ever pray. by Mr Calder, Mr Ewen Cameron, Mr Fisher, Mr Lusher, Mr McVeigh, Mr Millar and Mr Nixon.

Petitions received.

Refugees

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

That a grave threat to the life of refugees from the various States of Indo-China arises from the policies of the Government of Vietnam.

That, as a result of these policies, many thousands of refugees are fleeing their homes and risking starvation and drowning. Because of the failure of the rich nations of the world to provide more than token assistance, the resources of the nations of first refuge, especially Malaysia and Thailand, are being stretched beyond reasonable limits.

As a wealthy nation within the region most affected, Australia is able to play a major part in the rescue as well as resettlement of these refugees. lt should be possible for Australia to: establish and maintain on the Australian mainland basic transit camps for the housing and processing of 200,000 refugees each year; mobilise the Defence Force to search for, rescue and transport to Australia those refugees who have been able to leave the Indo-China States; accept the offer of those church groups which propose to resettle some thousands of refugees in Australia.

The adoption of such a humane policy would have a marked effect on Australia’s standing within the region.

And your petitioners as in duty bound will ever pray. by Mr Aldred, Mr Hurford, Mr Jarman and Mr Yates.

Petitions received.

Pre-School Education

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

  1. In S.A. P re-school services are becoming increasingly inadequate.
  2. The development of adequate services has been curtailed by reduced Federal Budget allocations to Pre-schools in the last two years.
  3. Projected cuts for 1979-80 will cause further deterioration of the quality of services offered.

Your petitioners therefore humbly pray that the Federal Government increase its allocation for Pre-school education immediately to enable the provision of adequate pre-school services in S.A.

And your petitioners as in duty bound will ever pray. by Dr Blewett, Mr Clyde Cameron and Mr Porter.

Petitions received.

Pensions

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 restoration of provisions of the Social Security Act that applied prior to the 1978-79 Budget is of vital concern to offset the rising cost of goods and services.

That reason advanced by the Government for yearly payments ‘that the lower level of inflation made twice-yearly payments inappropriate’ is not valid.

Great injury will be caused to 920,000 aged, invalid, widows and supporting parents, who rely solely on the pension or whose income, other than the pension, is $6 or less per week. Once-a-year adjustments strike a cruel blow to their expectation and make a mockery of a solemn election pledge.

Accordingly, your petitioners call upon their legislators to:

  1. Restore twice-yearly pension adjustments in the Autumn session.
  2. Raise pensions and unemployed benefits above the poverty level to 30 per cent of the average weekly earnings.

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

Petitions received.

National Health Scheme

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

  1. The NHS Patient Contribution of $2.50 towards the cost of pharmaceutical benefit item is excessive, and any increase on this amount is to be deplored.
  2. We the undersigned strongly object to the Government taking any such action.

We therefore do ask the Government of Australia not to take such action.

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

Petition received.

Community Health Centre Services

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

We are completely opposed to the concept of charging patients in Community Health Centres, and indeed, the very nature of fee-for-service medical service delivery.

We feel the Federal Health Department directive to charge patients attending Community Health Centres works to the detriment of the people of Collingwood who demonstrably failed to receive full twenty-four primary care before the Community Health Centre was established.

We pray that the Government do continue funding under the present guidelines.

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

Petition received.

Red Army Choir

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

That the Red Army Choir is a military propaganda unit glorifying the Soviet regime which is still hostile to the democratic way of life. The Red Army is the main instrument in keeping formally free people under subjugation, and its presence enables blatant violations of Human Rights to be perpetrated. The support, therefore, of such instruments of a totalitarian regime can only harm the development of free and liberal thought under it.

Your petitioners humbly pray that the Australian Government assert its support for the aspirations of subjugated people by denying entry into this country to the Red Army Choir.

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

Petition received.

Marine Radio Licence Fees

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

That we strongly oppose the increase in Marine Radio Licence fees for the following reasons:

  1. 1 ) Radios are an essential part of safety equipment.
  2. Marine Radio users save the government millions of dollars in Search and Rescue.
  3. 3 ) Increased licence fees will deter the boating fraternity from purchasing and using radios for their own safety and assistance to other craft will be therefore reduced.

Your petitioners therefore humbly pray that the government will not reconsider the increased licence fee, but consider a reduction of same in the interest of Safety.

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

Petition received.

Overseas Students

To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned, citizens of Australia, and overseas students, respectfully showeth our deepest opposition to the introduction of discriminatory fees for overseas students. Your petitioners therefore humbly pray that fee policy on overseas students be revoked in view of the following:

  1. Financial Implications and Impact on the Matriculation Overseas Students.

The matriculation students came to Australia under the impression that they would receive free education. However, this sudden imposition of fees will cause immense hardship to the students and their families. Many students will have to return to their home countries as they are unable to meet the fees. These students, on returning home, will not be accepted by any local tertiary institutions as the Australian Higher School Certificate or the Matriculation Statements (HSC) equivalent are not recognised by their home governments. These students will be deprived of any chances of further education.

Those applicants to study in Australia in 1980 (e.g. students in Taylor’s College, Malaysia) are caught in the dilemma, either to bear the extra financial burden or to give up further education totally.

  1. Aid to developing countries.

The majority of overseas students studying in Australia came from the developing countries. Most of them did not have the opportunity to seek any advanced education owing to the poor and extreme shortage of educational facilities in their home countries. These developing countries need trained and tertiary education person to help in meeting the challenge of technological development and to contribute to the economy of the countries. Australia, as a developed country, has a moral responsibility to assist the developing countries.

  1. Discriminatory Effect of the Introduction of Fees.

By the introduction of fees, it would mean only a few students from rich families would be able to come to study in Australia. Students from socially disadvantaged backgrounds would be deprived of the opportunity to obtain higher education. Thus making education a privilege, not a right.

  1. Interchange of cultures.

Overseas students have made a tremendous contribution in promoting better understanding and friendship between the people of Australia and the developing countries. The overseas students have provided the Australian public with the opportunity to learn and study the customs, life-style and different cultures of these various developing countries. Further, overseas students have made valuable contributions towards research and development in their post-graduate studies.

  1. Postive Form of Aid.

Providing educational opportunities to overseas students is the most effective and positive form of aid to developing countries.

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

Petition received.

Education

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 further cutbacks in Commonwealth funding to State Schools and transferral of funds to wealthy independent schools as required under the guidelines to the Schools Commission announced by the Minister for Education in early June are of vital concern in that they mitigate against the interests of the great majority of Australian Children in State Schools.

That Queensland State Schools have not reached the Resource Usage Targets set by the Schools Commission, and even at those financial levels will fall well short of actual provision standards envisaged by the Commission.

That Queensland’s effort in respect of Capital works is particularly of concern being less than half the per capita effort of other States.

Your petitioners therefore call on their legislators to ensure:

  1. That Federal funding to State Schools is restored to at least 1974-75 levels;
  2. the independence of the Schools Commission to recommend the allocation of funds to schools on the basis of need, unhindered by Government directive; and
  3. that sufficient funds are provided to Queensland, appropriately tied, to ensure achievement of National standards in this State.

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

Petition received.

Sale of Publicly Owned Enterprises

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

There is a definite limit to the quantity of Australia’s mineral resources.

Accordingly our resources should be managed and developed under Australian ownership and control.

Publicly owned trading enterprises and corporations have been established and operated for the benefit of Australians since Federation.

The Commonwealth Banking Corporation, Trans Australia Airlines, Housing Loans Insurance Corporation, Australian Meat and Livestock Corporation, Australian Wheat Board, were all designed to operate to the benefit of our Nation as a whole under public ownership.

The Fraser government’s irresponsible proposals to sell off our Nation’s interest in the Ranger Uranium Mine, the Housing Loans Insurance Corporation, and to dispose of other successful statutory corporations such as Trans Australia Airlines, would be contrary to the Nation’s interests.

Your petitioners therefore humbly pray that the House of Representatives will reject outright proposals of the Fraser government to sell the Ranger Uranium Mine, the Housing Loans Insurance Corporation, Trans Australia Airlines, and other publicly owned enterprises.

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

Petition received.

Health of Aboriginal Children

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 there are Australian Aboriginal children living under conditions of inadequate nutrition in a background of poor housing, hygiene, and overcrowding that amounts to ‘a Third World enclave in the midst of affluence’ (see also the Report from the House of Representatives Standing Committee on Aboriginal Affairs ‘Aboriginal Health’ 1979);

That such a state of affairs is intolerable in our country;

That only an effort on an unprecedented scale could create conditions that would give these children the rights set out in the United Nations Declaration of the Rights of the Child.

Your petitioners therefore humbly pray that the Government will make generous funding available for the specific purposes of:

Making a real improvement in the health, housing, education, employment and welfare of the Aboriginal people, doing so with due regard for the needs, hopes and aspirations of the Aboriginal people themselves;

Providing increased help, encouragement and opportunity for Aboriginal people to train as nursing aides and in other paramedical roles, and as fully qualified nurses, doctors and social workers;

Providing increased health education for Aboriginal people in ways that are acceptable to them.

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

Petition received.

Pensions

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

We present this Petition to seek a fairer and better deal for handicapped persons.

We urge you to implement this request through your Minister for Social Security.

The signatories to this petition are pleased to acknowledge the action your Government has taken to reverse the Budget announcement and therefore exclude the Invalid Pension from taxable income.

We now urge you to act in another area of discrimination to handicapped persons by:

Increasing the $20.00 per week income allowed in a sheltered workshop to $40.00 per week, before that income begins to reduce pension benefits; and then tie the $40.00 per week level with C.P.I./pension adjustments in the future.

Your petitioners therefore humbly pray that you act in this area of discrimination to handicapped persons by increasing the $20.00 per week income allowed in a sheltered workshop to $40.00 per week, before that income begins to reduce pension benefits; and then tie the $40.00 per week level with C.P.I./pension adjustments in the future.

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

Petition received.

Post Office Agency, Dandenong West

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

That they request Australia Post through Mr W. Yates M.P., Member for Holt, to reopen the Post Office Agency in Hemmings Street, Dandenong West.

This Agency has served the district for many years and was a convenience and service to the residents of Dandenong West and the surrounding area, many of whom are elderly and infirm.

The Dandenong Post Office is not conveniently situated in relation to public transport or car parking and is approximately 1.5 km distant from Dandenong West.

At least one shopkeeper is willing to have the Agency reinstated at his premises which is the Dandenong West Newsagency.

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

Petition received.

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MINISTERIAL ARRANGEMENTS

Mr MALCOLM FRASER:
Prime Minister · Wannon · LP

– I inform the House that the Treasurer (Mr Howard) left Australia on 22 September on a visit to Europe for a Commonwealth Finance Ministers meeting and for the annual meeting of the International Monetary Fund. The Minister for Finance (Mr Eric Robinson) will act as Treasurer until Mr Howard returns on 14 October. The Minister for Foreign Affairs (Mr Peacock) left Australia on Sunday to attend a meeting of the United Nations General Assembly in New York and will be away until 9 October. The Minister for Primary Industry (Mr Sinclair) is acting as Minister for Foreign Affairs during Mr Peacock ‘s absence. The Minister for Special Trade Representations (Mr Garland) plans to leave Australia today on a visit to Singapore, Malaysia and Iraq for trade talks. The Minister for Trade and Resources (Mr Anthony) will act as Minister for Special Trade Representations until Mr Garland ‘s return.

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QUESTION

QUESTIONS WITHOUT NOTICE

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QUESTION

TRADE RELATIONS WITH ASEAN COUNTRIES

Mr HAYDEN:
OXLEY, QUEENSLAND

– I ask the Prime Minister whether it is his intention to transfer responsibility for trade relations with all five Association of South East Asian Nations Countries to the Minister for Special Trade Representations. Will the change necessitate an enlargement of the Department of the Minister for Special Trade Representations? Does it reflect the critical low that has been reached in our commercial relations with ASEAN? Does it mean a further erosion of the responsibilities of the Minister for Foreign Affairs and his already sadly demoralised Department?

Mr Uren:

-i hope you are ready for that.

Mr MALCOLM FRASER:
LP

-The Leader of the Opposition generally gives me notice. I forgot to bring the answer in today.

The Leader of the Opposition’s question is an odd one indeed because the thrust of it seemed to be: Is the future of the Association of the South East Asian Nations trade relationship to be transferred to the Minister for Special Trade Representations, and does that diminish the Minister for Foreign Affairs and the Department of Foreign Affairs? Trade is a trade matter and if trade is handled in a separate department, as it is under my colleague the Deputy Prime Minister and the Minister for Special Trade Representations, that cannot in any way be construed as a reduction in responsibility of the Minister for Foreign Affairs or the Department of Foreign Affairs.

I think there is a great deal of misunderstanding sometimes about some of these matters. For example, during the discussions with ASEAN, and indeed with other countries on the International Civil Aviation Policy Review, the Department of Foreign Affairs and where necessary other relevant departments were involved throughout at official or ministerial level in formulating Australia’s approach. It was an approach of the Government and it was an approach which came out of discussions and advice from all the departments concerned. On the principal discussions officers of the Department of Foreign Affairs as well as officers of the Department of Transport have, of course, been involved. But there are no proposals to change the administrative arrangements in relation to these particular matters. It ought to be noted that the Department of the Special Trade Representative is a very small department of twelve, fourteen or fifteen people. It was therefore a very specific purpose to give additional ministerial capacity for discussions and negotiations on trade matters because quite plainly with the importance that this Government attaches to trade, it would not be possible for the Minister for Trade and Resources to be out of Australia to carry out all the work with the European Community, with ASEAN, with the United States, with Japan, with Korea, with New Zealand and all the rest. Additional ministerial support is especially needed in that area. It was done with a very small and very modest department and the intention is that that Department maintain its present modest size.

Whilst I have the opportunity I think it ought to be noted that over the last several years as a result of the measures taken by this Government through the ASEAN Australian Trade Fairwhich was very successful in Sydney and which I think is going to be repeated in Melbourne shortly- and through other special processes that have been introduced, such as the Early Warning System on trade problems that might develop either way, a good relationship has developed over these particular matters. When I was in Manila, as a result of the general relationship that had developed, President Marcos himself wanted to take out the trade agreement that had been put aside for many years and sign that trade agreement. Progress was made in relation to that agreement. That again is a sign of the growing and constructive relationship between ASEAN and Australia.

I think it is now becoming much more widely understood that ASEAN exports to Australia are growing at about 30 per cent a year or more, which is much more than the general level of imports into this country. The developing countries ‘ share of Australian markets is growing quite substantially and the ASEAN share of the market is growing. This is as a result of very specific measures that this Government has introduced and the trading opportunities that have been provided. It gives the lie completely and absolutely to the suggestion that this country is unduly protective and does not allow goods from ASEAN to enter Australia as they ought to. An increase of 30 per cent a year in its exports to Australia is a very substantial increase, and that has been going on year after year. I have no doubt that the exports from those countries to the Australian market will continue to grow. Indeed, many of the Government’s actions have been designed to encourage that to happen.

At the same time the ASEAN countries also understand now that they cannot solve all their trade problems by having access to the Australian market. We are 14 million people. Those countries need access to other markets such as North America and Europe. If they had access to North America and to Europe in relation to textiles, wearing apparel and footwear, for example, similar to that which they have to Australia, they would be exporting another $ 1 ,000m worth of goods each year.

page 1455

QUESTION

MOTOR VEHICLES

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– My question, which is directed to the Acting Treasurer, concerns the Budget statement on depreciation of imported and sold or leased motor vehicles. Has the Minister seen today a report of a government decision rejecting approaches from the importers and distributors of these vehicles? Has there been a Cabinet decision on this matter since 19 September? Is it a fact that there has been no change in the estimates by the dealers’ association and major importers of the loss of sales expected to be caused by this decision? Will this loss of imports and sales mean a revenue loss of about $36m in a full year, excluding the tax on profits on resale of leased vehicles which should be taxed under the law anyhow? Is the Minister aware that the Leyland Motor Corporation of Australia Ltd, employs 800 people in my electorate? Is it a fact that the clear profits made in Australia by Leyland are on the import and sale of premium vehicles, that these profits are used to subsidise Leyland ‘s manufacturing operations and that the elimination of those profits threatens the commercial viability of the company’s manufacturing operations and the jobs of some of its employees? Will the Minister have this matter reconsidered, and will he particularly take into account lost revenue, unemployment and our fair trade practices with the European Economic Community?

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

-I have seen reports in the financial Press about the alleged effects the matter raised by the right honourable member for Lowe might have on some motor vehicle importers and distributors. I was not aware until this morning that Leyland in fact did operate in the electorate of the right honourable member for Lowe. I am not aware that the Government has reconsidered this matter. It was a matter for Budget consideration in two areas: The first was the question of fixing as a maximum the amount of money in relation to which a taxation deduction could be claimed for depreciation purposes; the other was the question of non-taxable capital gains for vehicles which had been sold and which had been subject to leasing arrangements over a period of years. Of course, I have respect for the views of the right honourable member for Lowe. I will certainly take into account his comments to me. I will get from him as much information as I can in relation to the effects, as he sees it, on the various areas that he has indicated.

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QUESTION

BEEF

Mr LIONEL BOWEN:
KINGSFORD-SMITH, NEW SOUTH WALES

-I direct my question to the Prime Minister. I refer to a question I asked the right honourable gentleman on 29 May last relating to access for Australian beef in the United States as a trade off for continuation of United States bases in Australia. I refer the right honourable gentleman also to a report in the weekly newsletter Inside Canberra of 2 1 September on the same matter. I ask the right honourable gentleman: Did his Press secretary strongly deny to Inside Canberra a statement which is now reported as being made by Mr Alan Renouf, a former ambassador, that the Prime Minister had hinted to the United States Government that if Australia did not receive adequate treatment in the Multilateral Trade Negotiations the future of United States defence installations in Australia could be jeopardised? Did the Prime Minister give an instruction to his Press secretary to deny the reports, or was he aware that the denial was made? If so, why has the Prime Minister declined to answer the question on this subject which I placed on notice on 30 May last?

Mr MALCOLM FRASER:
LP

– It might be better if I answer the question on notice now.

Mr Lionel Bowen:

– Oh!

Mr MALCOLM FRASER:

– I hope the honourable gentleman will not object to the question on notice being answered now. Over a number of years there have been discussions at high levels with the Government of the United States of America on a very wide range of issues. On many occasions going back more than a decade I have drawn attention to the special relationship between the United States and Australia. It is both a treaty relationship and a relationship forged in a common cause in World War II, in Korea, in Vietnam and in many other instances of co-operation. The discussions that I had with the American Ambassador in February this year- the Foreign Minister was present for most of the discussions- were broad-ranging and covered the European Economic Community’s position on access for primary products and the role and attitude of the United States in the Multilateral Trade Negotiations as a whole and in its bilateral negotiations with Australia. In the course of these discussions there was again reference to the broad-based Australia-United States relationship going back over many years and the co-operation between our countries, including joint defence facilities.

In these circumstances, when countries are negotiating, I believe that the totality of relationships ought to be considered. Clearly the negotiating strength of the United States was at times important to us in these trade negotiations. I believe that reasonable access to Europe for Australian products was assisted by the support that came from the United States at different periods in the negotiations. But it would be entirely wrong for whatever remarks were made at that discussion in February to be construed as implying any threat of action by Australia in relation to defence facilities. I am sure that the remarks have not been so construed by anyone who understands the real significance and the basic strength of the Australia- United States relationship, which all people on this side of the House support and which I hope the Opposition also supports.

page 1457

QUESTION

GOVERNMENT GUARANTEES TO PUBLIC COMPANIES

Mr HYDE:
MOORE, WESTERN AUSTRALIA

– I ask the Acting Treasurer and Minister for Finance: What does the taxpayer, through the agency of the Commonwealth Government, stand to lose as a result of guarantees afforded to the Co-operative Farmers and Graziers Direct Meat Supply Ltd? If the taxpayers’ money is at risk, what has the Government budgeted to cover this expenditure? Are any other guarantees or loans to public companies currently expected to result in loss to public revenue? If so, which ones?

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

– The Government’s guarantee as to the Co-operative Farmers and Graziers Direct Meat Supply Ltd is for half of $9m. It was a joint guarantee with the Victorian Government for commercial borrowings. The Commonwealth has guaranteed up to $4.5m. Information coming to me is that there are difficulties in the industry and the position has somewhat deteriorated. It is not possible for me to tell the honourable member for Moore whether there will be any loss. I understand that abattoirs in Victoria, because of some reduction in the throughput, are having difficulty. There has been a request from the Chairman of the co-operative for an additional $4m from the shareholders to be paid to that co-operative. No allowance at all is made should there be a loss incurred by the Commonwealth Government with regard to the guarantee.

Other borrowings that I know the honourable member for Moore and other honourable members have been interested in include the borrowing of $2. 4m for the Mount Lyell Mining and Railway Company Ltd. Mount Lyell is now in a cash flow situation. I expect that money to be repaid during the course of this financial year. I have had correspondence with Mr Batt, the Deputy Premier of Tasmania, about this matter and I see no reason why it should not be repaid during this year. In fact the receipts allow for repayment of that figure. The other area of concern is the matter of the Chrysotile Corporation of Australia at Woodsreef. The agreement with the New South Wales Government and that company has not yet been finalised but the amount with which the Government could be involved is $1.4m. I can only indicate in that respect that my information is that one cannot be very optimistic, given the report that I have concerning that industry and that corporation. Of course, we do give a number of other guarantees. Guarantees to organisations such as Qantas Airways Ltd, Trans-Australia Airlines and Ansett Transport Industries Ltd involve very large, substantial, even immense amounts of money. I do not see any possible risk in those very substantial guarantees that the Commonwealth has given.

page 1457

QUESTION

TAXATION DEDUCTIONS: MOTOR VEHICLES

Mr HURFORD:
ADELAIDE, SOUTH AUSTRALIA

– My question also is directed to the Acting Treasurer. It is supplementary to the one asked by the right honourable member for Lowe concerning the correctness or otherwise of reports that the Budget measure limiting to $18,000 the value for depreciation purposes of motor vehicles may be dropped. Has he had brought to his attention the strong representations of, for instance, the Federation of Automotive Products Manufacturers against the present very substantial implicit subsidy attaching to each luxury car sold in Australia under the existing depreciation and lease provisions? In other words, are ordinary taxpayers subsidising the use of these luxury cars? Are taxation deductions for expensive leasing arrangements also to be limited? If not, why not? Will the Government persist with its Budget measure or capitulate to threats, which capitulation will cause a lesser number of jobs in Australian manufacturing industry?

Mr Eric Robinson:
MCPHERSON, QUEENSLAND · LP

-Yes, I have seen reports concerning this matter. There has been a substantial amount of publicity about it in recent weeks. It is a Budget measure and, as such, was announced by the Treasurer. Of course, it will require separate legislation which as yet has not come before the Government for finalisation. I have not had any personal representations on it. I can recall receiving correspondence about it. It is my understanding that the Treasurer, prior to his going overseas, did see some people from the industry who expressed concern at the effect it had. The honourable member is quite correct; it is in two parts. I thought that I had mentioned that earlier. First of all, there is the fixing of the maximum figure for a vehicle on which depreciation deductibility will be allowed. Secondly, there is an area which has been abused substantially, and that is people who have had a vehicle on lease selling it to an associate for the residual figure and then selling it for a much higher figure, with a capital gain and no taxation. I am not sure of the figure, but I think that $20m to $25m was the tax lost because of that particular occurrence.

page 1458

QUESTION

WHEAT PRICES

Mr FISHER:
MALLEE, VICTORIA

-My question is directed to the Minister for Primary Industry. I refer to a recent statement that the New South Wales Government intends to legislate to impose a ceiling on the price of stock feed and industrial wheats. As the new wheat plan involves Commonwealth and State complementary legislation and as the Australian wheat growers have agreed to these prices being determined by market forces alone, does this New South Wales decision threaten the effectiveness of the new five-year wheat scheme?

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

– As honourable members would know, under the existing stabilisation arrangements a price is set for domestic sales of wheat in the Australian market which embraces not only wheat sold for human consumption but also wheat for industrial and stock feed purposes. The present position is that all wheats are sold at that negotiated price. It was envisaged that the new arrangements should distinguish between wheat sold for human consumption and wheat for industrial and stock feed purposes. In order to determine a basis on which wheats for industrial and stock feed purposes should be sold, the Australian Wheat Board has been given a capacity to determine what it sees as a realistic market level.

In my view, whatever that level is, it is unlikely in market circumstances that prices would rise above the price set for wheat for human consumption. However, the New South Wales Government believes that unless some maximum is set within the legislation it is likely that in some circumstances prices could be payable for wheat for industrial and stock feed purposes significantly above prices for wheat for human consumption. It says that the formula to determine the price of wheat for human consumption has been calculated on what is a fair and equitable basis. The New South Wales Government believes that it would be inequitable to allow that to happen and it is therefore insisting, as I understand it, that a maximum price be set within its State legislation.

The legislation is, of course, the product of a Bill passed not only through this Parliament but also through all the State parliaments. If the States wish they can include any legislative provisions which lie within the responsibility of their parliaments and not the Federal Parliament. If New South Wales were to apply the upper price limit- given the geographic situation of New South Wales, its significance as a wheat producing State and the application of the interstate wheat trade- I do not believe that it would be realistic anywhere else in Australia for other than such a limit to be applied. I do not accept the conclusion which the honourable gentleman has stated that if there is to be a legislative upper limit it will be applied expressly at the request of the New South Wales Government. I do not believe that that will seriously disadvantage the prices for other grains or the wheat growers themselves.

page 1458

QUESTION

KAMPUCHEA

Dr BLEWETT:
BONYTHON, SOUTH AUSTRALIA

– I direct a question to the Acting Minister for Foreign Affairs. Why did Australia, in the United Nations last week, support the retention of the Kampuchean seat in the General Assembly by the ousted Pol Pot regime described earlier by the Minister for Foreign Affairs as ‘an evil and vicious despotism’? Would not the interests of Australia, the Kampuchean people and the international community have been better served by Australian support for the Indian compromise proposal to leave the Kampuchean bench empty for the time being?

Mr SINCLAIR:
NCP/NP

-As the honourable gentleman would know, this Government in its recognition of other governments does not necessarily bestow any significance on the politics or philosophies of those governments, nor the actions undertaken by them. We have been particularly critical of the Government of Pol Pot. At the moment, we are most concerned at the apparent starvation conditions that exist in much of Kampuchea. We are concerned to try to see in what way we can provide aid to its people. In terms of the attitudes and views of the Government within the United Nations with respect to either regime, we have not recognised the regime which currently purports to exercise government over much of Kampuchea. Whilst we retain a good deal of cynicism about the manner and form of the Pol Pot Government, we do not believe that it is appropriate at this time for us to change our attitudes or views with respect to the future.

Our concern is that both governments recognise the plight of the people of that country and hopefully, that they will enable the free passage of those who are seeking to provide international aid for the people of Kampuchea. I believe that this is a far more significant proposal than any other. In regard to the Indian proposal, I do not believe that when the people of a country are obviously in distress it is wise for that country not to be represented in the United Nations. It was on that the basis that the Government gave its vote.

page 1459

QUESTION

SMALL BUSINESSES

Mr JARMAN:
DEAKIN, VICTORIA

– Can the Minister for Industry and Commerce tell the House what measures the Government has taken to increase the access of small businesses to available sources of finance? What funds, if any, have been allocated by the Commonwealth Development Bank in the past 12 months for this purpose?

Mr Jacobi:

- Mr Speaker, I take a point of order. I draw your attention to Question on Notice No. 4500 standing in my name.

Mr SPEAKER:

-The question is in order. I call the Minister for Industry and Commerce.

Mr LYNCH:
Minister for Industry and Commerce · FLINDERS, VICTORIA · LP

– The Government is particularly conscious of the importance of small business to the Australian economy. There are some 370,000 small businesses throughout the country which are worth about 90 per cent of the free enterprise section of the Australian economy. I welcome the question which the honourable gentleman has posed because it reflects the continuing interest he has shown in the needs of the small business community over a long period. Some time ago, this Government extended the charter of the Commonwealth Development Bank to enable the Bank to lend to all types of businesses, thereby removing the restrictions which previously confined the lending of the Bank to the rural, tourism and industrial sectors. I am happy to report to the House that since June 1978 when the extension of the Bank’s charter took place, the value of non-rural loans approved has increased by 94 per cent- a very sharp lift- to $36m. That covers some 750 non-rural applications which have been approved compared with about 430 for the comparable period of the previous year.

The significant lift in lending by the Commonwealth Development Bank which has taken place has gone very importantly into the small business sector which demands and has received the full support of this Government. I might say that of course this is not the only area in which the Government has taken very effective steps to assist the small business community of Australia. I remind the House of the recent Budget submission to lift the retention allowance under division 7. It has now risen to 70 per cent from the earlier figure of 60 per cent. That is worth $30m to small companies throughout Australia and, of course, is a lift which took place on the earlier move from 50 per cent to 60 per cent in the 1976 Budget.

Small business will also gain very considerably from the Government’s decision to abolish Federal estate and gift duties and of course will share in the Commonwealth’s overall program of industry support which is seen in the industrial research and development area- the export market and development grants program- as well as in the very important assistance which the Government provided for the tourist industry in the recent Budget. I share with the honourable gentleman his concern for the needs of the small business area. The Government has responded very firmly to those needs in the financial as well as the general support areas. The assistance measures that I have just outlined are consistent with the Government’s intention to provide the small business community of Australia with continuing support.

page 1459

QUESTION

LIQUEFIED PETROLEUM GAS

Mr KEATING:
BLAXLAND, NEW SOUTH WALES

– My question is directed to the Prime Minister. Will the Government respond positively to representations of State governments and municipal gas utilities to reduce the price of liquefied petroleum gas consumed in regional centres throughout Australia? Is it a fact that country people are paying import parity for their gas under the Government’s oil price policy, that is, at an oil equivalent of $ 18 a barrel in contrast to the $3 a barrel oil equivalent for gas being paid by the majority of consumers connected to natural gas pipelines? Will regional consumers be relieved of the Government’s high regional gas price policy? Can the Prime Minister say what specific measures the Government has in mind?

Mr MALCOLM FRASER:
LP

-The Victorian Premier, Mr Hamer, and in his absence the Acting Premier, Mr Thompson, spoke to me about this particular matter. It is under examination at the moment and at the appropriate time a report from the Minister for National Development will be coming to the Government. The matter is not necessarily a simple one because there are different issues in different States. I think in at least one State supplies of LPG to country utilities are subsidised either by the State government or the State power authorities. That would of course give the States undertaking that a particular interest in seeing that any involvement of that kind was transferred from their shoulders on to some other government’s shoulders. As I say, there are different issues in different States and the matter is under examination.

page 1460

QUESTION

ALTERNATIVE MOTOR VEHICLE FUELS

Mr Ewen Cameron:
INDI, VICTORIA · LP

-The Minister for Industry and Commerce will be aware of the running cost and pollution advantages of using liquefied petroleum gas and diesel fuel for powering motor vehicles. Will the Minister advise the House on the steps that are being taken by vehicle manufacturers to offer alternative fuel systems to car buyers? Will the Minister consider reducing duty on motor vehicles entering Australia which are designed to use LPG, diesel fuel or compressed natural gas as a method of conserving petroleum supplies, reducing pollution and overcoming the shortage of this type of vehicle in Australia?

Mr LYNCH I am very much aware, as is the Government, that there can be significant advantages from the point of view of running costs and also of pollution in using alternative fuels such as LPG and diesel for powering motor vehicles. The House will be aware of the very comprehensive statement made by the Prime Minister in relation to energy conservation and development. As part of that statement the Prime Minister indicated the Government’s objective of having LPG fuelled vehicles built on production lines in Australia. Since that time intensive discussions at ministerial level have been held with the industry and we have met with the executive of the Federal Chamber of Automotive Industries. The industry has raised a number of issues which are pertinent to the Government’s objective. It, of course, pointed to the need for revised safety standards for LPG equipment and their uniform application throughout Australia. These issues are at the present time under very active examination in Victoria by the Standards Association of Australia and the LPG task force. In the meantime, the companies themselves are actively examining the technical and commercial aspects of LPG production with a view to introducing such vehicles onto the production line.

So far as diesel is concerned, there has been less demand in this country for diesel powered cars than there has been in Europe and the United States. This is partly explained by the absence of a significant differential between the price of diesel fuel and petrol in this country. But demand for diesel powered vehicles is certainly increasing. One local producer at the present time has commenced assembly of a diesel engine powered car and several other models are being imported.

In response to the honourable member’s query about the question of duty, the Government is not contemplating any reduction of duty on cars entering Australia which are designed to use LPG, CNG or diesel fuel. It is, of course, open to any importer to introduce such cars into Australia through the existing import arrangements. I am aware that at the present time there are supply constraints abroad and also that some of those arrangements have a degree of inflexibility which the Government is considering at the present time.

page 1460

QUESTION

FRASER GOVERNMENT

Mr WEST:
CUNNINGHAM, NEW SOUTH WALES

– Is the Prime Minister aware of the public disquiet over suggestions of growing instability within the Government? Does he agree -

Government members- Oh!

Mr SPEAKER:

-Order! The honourable member will resume bis seat. The honourable member ought not to imply a result in his question and honourable members on my right ought to listen to the question in silence. I call the honourable member for Cunningham.

Mr WEST:

-Thank you, Mr Speaker. Does the Prime Minister agree with the statement of the Minister for Health that the Government is being subjected to sabotage and back-stabbing or does he interpret the events referred to by the Minister for Health merely as one section of his Government exercising its conscience as an independent political organisation?

Mr MALCOLM FRASER:
LP

– I am just waiting for the day when the gentleman- I suppose one day he will become honourable- who accused the Leader of the Opposition of a gutless sell-out to the Left enters the Parliament.

page 1460

QUESTION

OIL SUPPLIES TO AUSTRALIA

Mr O’KEEFE:
PATERSON, NEW SOUTH WALES

– I ask the Minister for National Development whether it is a fact that a meeting of Government Ministers was held yesterday with executives of the major oil companies concerning oil supplies to Australia? If so can the Minister inform the House whether the meeting was successful? Can the Minister say whether increased supplies of petroleum to Australia will result?

Mr NEWMAN:
Minister for National Development · BASS, TASMANIA · LP

– A meeting was held yesterday with oil executives. That meeting dealt with several issues, one of which is a problem that has arisen because of an industrial dispute about two tanker ships that has resulted in the loss of production of oil from Bass Strait and Barrow Island. This will result, in the next five or six weeks, in some shortfalls of products in some areas of Australia. However, we have asked the oil companies to do everything possible to minimise the effect of any shortage or to overcome any shortage. The oil companies will be reporting back next week on ways and means in which that will be achieved. I will be keeping the Parliament and the people of Australia informed of the results of that meeting.

page 1461

QUESTION

DISALLOWED QUESTION

Mr Armitage having addressed a question to the Minister for Finance-

Mr SPEAKER:

-Order! The honourable member’s question is out of order.

Mr Armitage:

– I raise a point of order. On what grounds is the question out of order?

Mr SPEAKER:

-Because it relates to a matter for which the Minister is not responsible, that is, a public affair.

Mr Armitage:

– I raise a further point of order. I was referring to the fact that the Minister had rejoined the Ministry and asking for the reasons why he decided to rejoin the Ministry.

page 1461

QUESTION

AUSTRALIAN MUSIC: RADIO QUOTA

Mr FALCONER:
CASEY, VICTORIA

-My question is directed to the Minister for Post and Telecommunications and concerns the quota for Australian music on radio. I remind him that the Australian Broadcasting Tribunal recommended in June 1977 that the quota be increased from 20 per cent to 30 per cent by May of this year. Has the Government endorsed the Tribunal’s recommendation of a 30 per cent Australian quota? Was the matter to be further considered by the Tribunal immediately following the hearings in June of this year into the renewal of the Melbourne television licences? What progress has the Australian Broadcasting Tribunal made in these deliberations? Can the Minister inform the House what considerations, if any, have delayed the Tribunal in implementing its recommendations, which gave such hope to the Australian music and recording industries?

Mr STALEY:
Minister for Post and Telecommunications · CHISHOLM, VICTORIA · LP

-The Government did agree with the proposition that the Australian Broadcasting Tribunal should set standards for Australian content in both radio and television and, in particular, it agreed that there should be increased content for Australian radio stations in the playing of Australian material and material produced within Australia. The implementation of this proposal is a matter for the Broadcasting Tribunal in discussion with interested parties and, of course, the various industry bodies. Those discussions have been under way in recent times. I would expect final decisions about levels and timing to be announced in the relatively near future. But I do underline the fact that this Government certainly supports the proposition, as a general one, that there should be higher levels of Australian content in this area.

page 1461

QUESTION

MEAT EXPORTS

Mr KERIN:
WERRIWA, NEW SOUTH WALES

– I direct my question to the Minister for Transport. Is it a fact that Australia is about to lose a contract to supply a Middle East market with 160 tonnes of fresh lamb a week, worth nearly $6m to the exporters, due solely to a decision by the Minister not to relax operating restrictions on supplemental air cargo airlines? Is it a fact, as has also been claimed, that this is another example of cutting off our nose to spite our face by way of protecting Qantas Airways Ltd?

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

– I have read with some interest an article on this very question. It seems to me that there is a bit of confusion about it. In the first place, the article refers to an application by British Cargo Airlines, formerly IAS Cargo Airlines, which in the last couple of years was given a right by me to bring back split charters from the West on the return voyage for the carriage of Western Australian lamb. It is now claiming that it can obtain markets in Syria if it is likewise able to bring back split charters on its aircraft as return freight. I should point out that the proposition really boils down to this: The cargo carrier wants to take the freight away from the scheduled carriers that now operate in this country. I have said to British Cargo that millions of tonnes of freight come into this country and that it is welcome to develop any freight carriage proposal in respect of that freight. But if it takes the split charter cargo already scheduled to be carried by the scheduled carriers, all it is asking to do is to increase the passenger costs of the travellers on those aircraft because when the scheduled carriers lose freight, which is an integral part of their total operation, and the costs go up because of it, they will have to increase the fares to passengers on the routes to offset it.

I have also said to the people who came to see me that there are plenty of routes into this country and points of destination from which they can pick up cargo without any inhibitions and without having any effect on the scheduled carriers. Therefore, I did not think the proposition was fair to the passenger carriers. It is only a prospect in this particular case. I understand that one other cargo carrier is prepared to carry lamb, if the agent will give it consideration, based on the proposition I have just put. The end result is that I have had to say no to British Cargo on this issue. In my view it does not inhibit the cargo carrier at all from picking up its share from the millions of tonnes of freight available to it.

page 1462

QUESTION

TERM OF PARLIAMENT

Mr BURR:
WILMOT, TASMANIA

– Is the Prime Minister aware of reports that the New South Wales Government intends to put forward a referendum proposal that the life of the New South Wales Parliament be extended to four years? Will the Government consider a referendum proposal in conjunction with the 1980 general elections to the effect that the life of the House of Representatives be extended to four years and the term of a Senate appointment be eight years?

Mr MALCOLM FRASER:
LP

-That is an interesting proposition. I think referenda have shown over a long period that unless there is a fair measure of agreement between the major parties they are unlikely to be accepted. I believe, in the terms in which the honourable gentleman put it, that such a referendum would have the whole-hearted support of all members of the Senate. A term of eight years would no doubt be attractive to honourable gentlemen. That might well remove some of the difficulties that have sometimes faced referenda. I have not really given this matter a great deal of thought, but in the light of the New South Wales Government’s suggestion I am prepared to consider it.

page 1462

QUESTION

NUCLEAR WASTE MATERIAL

Mr UREN:

-I direct a question to the Minister for National Development. What is the nature of the arrangements being negotiated between the Australian Government, the Western Australian Government and the Government of West Germany concerning the dumping of nuclear waste in Western Australia? What stage have these negotiations reached?

Mr NEWMAN:
LP

-The Australian Government’s position on this matter is very clear. The Government would not adopt a policy of allowing nuclear waste from overseas to be dumped in this country.

page 1462

QUESTION

HOUSING INDUSTRY

Mr CADMAN:
MITCHELL, NEW SOUTH WALES

– My question is addressed to the Minister for Housing and Construction. Is it true that the Building Workers Industrial Union of Australia and other elements of the union movement are presently engaged in a war against the housing industry sub-contract system? Has the efficiency of the sub-contract system helped the industry to keep down prices of new houses, so benefiting home buyers and the general community? Can the Commonwealth

Government take action to protect the subcontract system from destruction by the union movement?

Mr GROOM:
Minister for Housing and Construction · BRADDON, TASMANIA · LP

– The honourable member for Mitchell is quite right when he speaks of the attack presently under way by certain elements of the union movement, in New South Wales in particular, on the housing industry sub-contract system. I know that he has taken a very keen interest in this subject and has attended a number of meetings on the matter in New South Wales in recent weeks. This attack has been evident for some months, especially in New South Wales, but it has extended to a couple of other States- Victoria and South Australia- involving in particular the Building Workers Industrial Union of Australia, which obviously seeks to destroy the self-employed status of tradesmen and other small business people who are involved in this important industry.

Quite a vigorous campaign is under way. I think it is important that the House be aware of this campaign. The union wants to force people to become employees. It wants to unionise the housing industry, to extend its power and influence over this industry and of course, its income from the subscriptions that employees would be required to pay. Unfortunately, it appears that the New South Wales Government has been influenced by this campaign. It has undertaken an inquiry into the sub-contract system in New South Wales which will be very costly and obviously long drawn out. I believe it will also be an unjustified inquiry in the circumstances. I think that is evident from the vehement defence of the inquiry by Mr Syd Einfeld, the Minister for Housing in New South Wales, in sections of the Press this morning.

It would be a very disastrous thing for the housing industry if this present campaign proves to be successful. The people of New South Wales, in particular, should be aware of what would occur if the sub-contract system were destroyed in that State and indeed, in any other State of Australia. It would obviously reduce the initiative that is shown by these self-employed people- the small business people and the tradesmen involved in the industry. This industry has been able to avoid industrial stoppages that have occurred in other sections of the building industry in recent years, and that is so important to the question of costs in the industry. It would result, no doubt, in a substantial increase in housing costs. I have been told that it would mean at least a 25 per cent increase on the cost of an average house. A gentleman in one of the housing industry bodies indicated to me the cost increase would be over 40 per cent. That is a very substantial increase indeed. Should that increase occur in costs, it would mean that fewer houses would be constructed in Australia. That would be a bad thing for the industry, a bad thing for the community and everybody would be worse off.

We will be watching the situation very closely indeed because we realise its importance. We have an observer at the present time attending meetings of the inquiry in New South Wales to keep the Government informed of its developments. We believe in the sub-contract system. We recognise its significance for the industry and we will do all we can to support its continuation.

page 1463

COMMONWEALTH BANKING CORPORATION

Mr SPEAKER:

-Pursuant to statute, I present the annual reports and financial statements of the Commonwealth Banking Corporation, the Commonwealth Trading Bank of Australia, the Commonwealth Savings Bank of Australia and the Commonwealth Development Bank of Australia, together with the Auditor-General’s reports thereon, for the year ended 30 June 1979.

page 1463

AUSTRALIAN DRIED FRUITS CONTROL BOARD

Mr SINCLAIR:
Minister for Primary Industry · New England · NCP/NP

– Pursuant to section 3 (7) of the Australian Dried Fruits Corporation Act 1978 I present the report for the final period of the Australian Dried Fruits Control Board 1 978.

page 1463

NAVY PATROL BOATS

Mr SPEAKER:

-The Minister for Defence has indicated to me that he wishes my indulgence.

Mr KILLEN:
Minister for Defence · Moreton · LP

– Last week I gave the House information concerning the Fremantle class patrol boat and I pointed out to the House that the lead ship is overweight. My attention has been drawn to what, on any reasonable construction, is an ambiguity in my answer. The ambiguity is this: I have said that the Commonwealth is completely indemnified. That was the advice tendered to me with respect to the lead ship. In my humble opinion, I agree with that advice. The position is less clear with respect to the follow-on craft. I wish to inform the House that I have this day written to the Attorney-General (Senator Durack) asking him for his opinion of the position. When I have received from the AttorneyGeneral his opinion I will convey the terms of it to the House.

page 1463

INDUSTRIES ASSISTANCE COMMISSION

Mr FIFE:
Minister for Business and Consumer Affairs · Farrer · LP

– For the information of honourable members I present the report of the Industries Assistance Commission on fixed resistors.

page 1463

DEPARTMENT OF THE CAPITAL TERRITORY

Mr ELLICOTT:
Minister for the Capital Territory · Wentworth · LP

– For the information of honourable members I present the annual report of the Department of the Capital Territory for 1978-79.

page 1463

AUSTRALIAN FISHING ZONE

Ministerial Statement

Mr SINCLAIR:
Minister for Primary Industry · New England · NCP/NP

– by leave- I am pleased to inform the House that the Governor-General has approved the proclamation of 1 November 1 979 as the date on which the provisions of the Fisheries Amendment Act 1978 not yet in force are to come into operation. From that date Australia will have a 200 nautical mile Fishing Zone in accordance with international law. Australia will thus join with the other Pacific Forum countries which have established similar zones in accordance with the Port Moresby Declaration of September 1977. Within the 200 nautical mile Australian Fishing Zone foreign fishermen will be in breach of the Act unless they have the necessary Australian licences and they will be required to comply with terms and conditions of access determined by Australia.

It will be recalled that when I introduced the Fisheries Amendment Bill 1978 in the Parliament last year I pointed out that when the zone commences we will have international obligations with respect to management of the fisheries resources to ensure their proper conservation and optimum utilisation. These objectives are set out in what will become section 5B of the Fisheries Act. To give effect to its obligations, Australia will, as appropriate, determine total allowable catches, the amount of the allowable catch that will be taken by Australians and the allocation to foreign countries of any available surplus. Foreigners will not be allowed access to fisheries fully exploited by Australians or likely to be so in the near future. In time, as Australians develop the necessary capacity to operate in those fisheries where they do not now operate, the allocation to foreigners will be reduced accordingly. The Government hopes that ultimately Australians will harvest the whole of the allowable catch but in some fisheries this may take some time because of economic and productivity factors.

Foreign boats allowed to fish in the AFZ will fall into three categories: Foreign fishing under bilateral arrangements, feasibility fishing and commercial joint ventures. The most numerous initially will be those licensed for purely foreign operations, normally in accordance with government to government fisheries agreements. In concluding such arrangements in pursuance of Australia’s jurisdiction over the resources of the Zone we will be acting to ensure maximum benefits for Australia and the protection of the interests of Australian fishermen.

Last year I sought applications from Australian companies in conjunction with foreign interests wishing to carry out feasibility fishing projects. The Government has approved a number of ventures involving interests from Japan, the Republic of Korea, the United States of America and Poland to carry out these projects. They are intended to assess the extent and commercial viability of harvesting unknown or little known resources in the AFZ. They provide a relatively low cost means for Australia to evaluate off-shore fisheries resources. They are limited to a maximum of two years and will not entitle either foreign or Australian participants in them to any exclusive or preferential rights in any fishery that may develop. All information gained from these projects will be made available to the Australian fishing industry to assist assessment of whether commercial development by Australians, solely or with foreigners in commercial joint ventures, is feasible. At all times, the Government will give preference to purely Australian operations in the AFZ.

I now turn to the details of bringing the relevant provisions of the Fisheries Amendment Act 1978 into operation and thus establishing the AFZ. Under the definition of ‘Australian fishing zone’ the AFZ only includes waters that are proclaimed waters’ under section 7 of the Fisheries Act, and does not include any waters that are proclaimed to be ‘excepted waters’ under section 7A of the Fisheries Act. Also, it will not include any waters that are specifically excluded from the AFZ by appropriate terms in any international agreement with another country. It is therefore important to understand the specific steps that will be involved. As the first step, the Governor-General has approved a new proclamation of proclaimed waters which will replace the proclamations presently in force, and will govern the application of the Fisheries Act to

Australian fishermen and, pending the establishment of the AFZ foreign boats within the existing 12-mile declared fishing zone. This proclamation will be published in the Gazette of 26 September 1979 and will come into force on that date.

The proclaimed waters will include ali waters beyond the territorial limits of Australia or of another country and that are within 200 nautical miles of Australia. Australia for this purpose includes all islands that are part of a State, including Macquarie Island, Lord Howe Island, and all islands that are part of the Northern Territory. The States and the Northern Territory will continue to administer fisheries inside the 3-mile territorial sea, in accordance with and subject to the arrangements that have been agreed under the off-shore constitutional settlement successfully concluded with the States at the recent Premiers Conference. Proclaimed waters are now also to include all waters within 200 nautical miles of each Australian Territory, other than waters within the territorial limits of other countries. I wish expressly to refer in this regard to the fact that the waters up to 200 miles off the Australian Antarctic Territory are to be covered by the new proclamation.

The next step after the proclamation of proclaimed waters will be the coming into force, on 1 November next, of the provisions of the Fisheries Amendment Act 1978 relating to the AFZ. The AFZ, in which Australia controls the operations of foreign fishermen as well as of Australians, also extends 200 nautical miles from the baselines. However, the AFZ would overlap with the existing or prospective 200 mile zones adjacent to Australia’s neighbours. Except in the case of Papua New Guinea, to which it shall refer separately, the Government has decided that, pending conclusion of delimitation negotiations with these countries, median lines in accord with Australia’s maximum legal entitlement should be used for the interim delimitation of the AFZ in areas between Australia and its neighbours. By agreement with Papua New Guinea pending the entry into force of the Torres Strait Treaty, in the area between Australia and Papua New Guinea the Australian Fishing Zone will extend to the fisheries jurisdiction line described in the Treaty, except in the protective zone where existing areas of jurisdiction south of the line will be maintained. Fisheries jurisdiction will also be exercised within the three-mile territorial seas around Australian islands north of the fisheries jurisdiction line. Negotiations on permanent maritime boundaries with Indonesia began in February. Two rounds of negotiations have been held and these will be continued. Discussions also have been held with the Solomon Islands. It will be necessary to enter into similar negotiations with New Zealand and France.

The Proclamations approved by the Governor-General apply to the waters within 200 miles of the Australian Antarctic Territory. The application of the Fisheries Act to waters adjacent to the Australian Antarctic Territory is based on Australia’s sovereignty over the Australian Antarctic Territory. The Government proposes to recommend an additional step under the Act with regard to those waters. As already mentioned, the amendments to the Act last year enable the Governor-General, by proclamation, to declare any proclaimed waters to be excepted waters. When introducing the amending legislation I pointed out that the concept of excepted waters provides the Government with flexibility to delay or exclude the application of the Australian Fishing Zone in certain areas. Against the background of the Antarctic Treaty and Australia’s current involvement with other Antractic Treaty countries in negotiations for the conclusion of a convention for the conservation of antarctic marine living resources, the Government proposes to recommend to the GovernorGeneral that, in all the circumstances, the appropriate course at this time is to take the further step of excepting Austraiian Antarctic Territory waters from the AFZ. The exception will not affect the application of the Fisheries Act to any Australian fishing activities off the Australian Antarctic Territory.

In view of our close relations with Japan and the long-established presence of Japanese fishing vessels in waters off Australia, we commenced negotiations on access to the AFZ first with the Japanese Government. The negotiations have concerned a head fisheries co-operation agreement, a subsidiary agreement covering access for tuna long-line vessels, and related matters. Negotiations by officials have now concluded and the resulting agreement is under consideration by the Government prior to the formal signing of the documents. Whilst the head fisheries co-operation agreement will remain in force for a minimum period of two years and will provide the basis for our future fisheries relations with Japan in the context of Australia ‘s extended maritime jurisdiction, the subsidiary agreement covering the access of tuna long-line vessels is for one year. In line with international practice, Australia reserves the right to review the terms of foreign access to the AFZ on an annual basis to enable responsible management of the resources in the AFZ and to protect the interests of the

Australian fishing industry. Under this subsidiary agreement, the Japanese side has agreed to the payment of an access fee of $ 1.4m, which will include its vessels’ statutory licence fees, and to the continuation of technical assistance for the benefit of the Australian fishing industry. The technical assistance program has been in operation since early 1976. In addition, the Japanese Government has provided certain assurances on access to the Japanese market for Australian fish and fish products. Details of the agreement will be made available following its acceptance by both governments.

Talks have also been held with Taiwanese commercial interests concerning access, albeit on a smaller scale than current operations, for trawlers and gillnetters to waters off the north and north-west of Australia. The Taiwanese represent the only other substantial foreign fishing presence within 200 miles of Australia. As we do not recognise Taiwan, we have held discussions with Taiwanese fishing interests and their Australian agents. The results of the talks are now under consideration by the Commonwealth and the relevant States with a view to finalising arrangements to enable licences to be issued prior to the commencement of the AFZ. The arrangements will provide for severe penalties for illegal fishing activities, and in discussions with Taiwanese fishing industry leaders it has been made clear that access to the AFZ is dependent on cessation of illegal activities, in particular, by the clam boats in the Great Barrier Reef. Negotiations have also been held with the Republic of Korea concerning a head fisheries co-operation agreement and arrangements for access to fisheries not exploited by Australians. These negotiations will be resumed shortly. No timetable has yet been set for negotiations with other countries.

The Commonwealth appreciates the importance which the States attach to fisheries matters. Throughout the period of preparation for the AFZ, the Commonwealth has maintained continuous consultations with the States and has kept them informed of the progress throughout the negotiations. Among the matters under discussion with the States are the role of State officers in enforcement of the rules applicable to the AFZ and in gathering information on foreign fishing operations there. Commonwealth officials are presently studying the basis on which the States are reimbursed for enforcement activities carried out on behalf of the Commonwealth, to see whether that basis will continue to be suitable for work in the AFZ. The Government has provided funds for observer activities undertaken by the States for the Commonwealth. Whilst the Commonwealth, in co-operation with the States, will determine the systems for gathering information and will undertake its collection, processing and distribution, the finished data will be published and made available to the fishing industry as well as to government agencies, State and Commonwealth.

The Minister for Transport (Mr Nixon) announced in July of last year details of the Government’s upgraded civil coastal surveillance program which, among other matters, was designed to take account of the need to enforce Australian fishery laws after commencement of the AFZ. The legislative systems that have been devised for the AFZ will supplement the physical surveillance that the Government will need to provide. For example, licensed boats will be under a legal obligation to report their positions in the AFZ every 2 days and to obtain advance approval to enter the AFZ, to leave it, to enter an Australian port, or to travel in the AFZ outside their authorised fishing area. Within the next 2 years the Government will be reviewing surveillance arrangements as foreshadowed by the Minister for Transport in his statement.

Apart from certain direct financial benefits, such as access fees, which will flow to the community from the AFZ, the Government anticipates that other benefits will flow, for example, to the Australian fishing industry as it increases its share of the total allowable catch; to the fish processing industry, which may handle a portion of the foreign catch as well as the expected increase in domestic production; and to traders and local authorities in ports to which licensed foreign boats are granted entry rights. The Commonwealth Scientific and Industrial Research Organisation’s Division of Fisheries and Oceanography and the Department of Primary Industry have been strengthened to meet the need for fishery research and management of the AFZ. The charter by CSIRO of a 50-metre fishing research vessel, the Soela, will further strengthen Australia’s fisheries research capacity. Fishery research and management in the AFZ will continue to be co-ordinated through the Australian Fisheries Council.

I have spoken at some length and in some detail on the Australian Fishing Zone. The Government regards it as a significant event in Australia’s maritime history, bringing the living resources in an area of sea nearly equal to that of the Australian land mass under Australian management, together with the associated benefits and responsibilities. The AFZ, at the same time is not a gold mine. We need to accumulate a great deal more knowledge of the physical characteristics of the Zone itself and of its fish resources. The Government is cautiously optimistic that, as our knowledge increases, the AFZ will prove to be a valuable asset, capable of yielding continuing economic benefits. It is our intention to manage the AFZ, with that objective always in view. I table a map of the area to be delineated by the Australian Fishing Zone. I questioned Hansard earlier in the day and, regrettably, I was told that it is not possible to print the map in Hansard, that having been my earlier intention. I have tabled it and it is available to honourable members. It will give honourable members and other persons interested some idea of the extent of the waters that are in fact covered by the statement I have just made to this House. I present the following papers:

Australian Fishing Zone- Map- Ministerial Statement, 25 September 1979.

Motion (by Mr Fife) proposed:

That the House take note of the papers.

Mr KEATING:
Blaxland

-The Opposition will be seeking to reply in detail at a later stage to the statement just made by the Minister for Primary Industry (Mr Sinclair). It is a comprehensive and significant document. My colleague in the Senate, Senator Walsh, will also respond to it as the appropriate Opposition spokesman on matters for which the Minister for Primary Industry has responsibility in this House. A number of issues remain unclear. I might just point out that the Opposition’s attitude to the 200-mile exclusive economic zone and to the Australian Fishing Zone was outlined by me, amongst others, at the conference held by the Australian Institute of International Affairs on 1 September this year. I presented to that conference a paper called: ‘The Control and Development of Australia’s Off-shore Economic Zone ‘. In that paper I referred to the fishing zone issue. A number of the points to which I referred in that paper have not really been covered adequately by the Minister.

One point which I might mention at this stage is concerned with Antarctica. Australia has spent very little money on the Antarctic region. One wonders what the wisdom is of declaring for the benefit of Australia a 200-mile fishing zone off the Antarctic coast. The Minister said in his statement that the 200-mile fishing zone would be declared for Australia’s Antarctic territory. Then he went on to say that these waters would be excepted waters’. I could not understand what he meant by that. I think the Government should make a full statement on its Antarctic policy and on whether it sees Australia’s role in terms of some kind of exclusive fishing rights off the Antarctic coast. There is also room for the Government to expatiate on a policy on Antarctica relating to environmental problems, commercial problems and international relations, particularly in the event of the declaration of a 200-mile exclusive economic zone. In that event the prospect of mineral and energy development will loom large in the thinking of many private organisations. I think the environmental issues concerning Antarctica should be tackled before any such pressure is applied for development. The whole question of Antarctic has not been attended to adequately by the Government, and this statement does not really shed very much light on it.

The Minister also referred to the terms and conditions for licencing foreign fishing vessels, but he did not give any details as to the kinds of terms that would be appropriate. I think that that information would be welcomed by the Opposition so that we could have an understanding of the Government’s thinking on this issue. The mechanisms for negotiation and the institutional arrangements which the Government would set up to maintain ongoing discussions with other countries about fishing within Australia’s 200-mile fishing zone are also matters which were not attended to in the Ministers’ statement. More specifically he did not cover the kinds of trade-offs which the Government sees for the granting of fishing licences in this area, particularly to countries such as Japan. All of these issues need clarification.

Another matter which comes to mind as being skimmed over by the Minister in his statement is the defence and surveillance problem. It is all very well to say that bilateral legal agreements buttress physical surveillance of the Australian coastal region and that the Taiwanese and Japanese fishing authorities will come to an arrangement with Australia about how the area is to be treated. But, in fact, we virtually do not have a coastal maritime surveillance capability at all. My colleague, the honourable member for Corio (Mr Scholes), has often argued that we need a unit of the Royal Australian Navy dedicated to maritime reconnaissance not only in relation to fishing but also in relation to drug running and general surveillance of areas close to our ports and all the other maritime tasks which Australia is undertaking. There is no real mention of these matters in the statement. At the moment all the Government is really saying is that it intends to declare a 200-mile fishing zone and that it will allow Australians to operate in that zone. I hope that at some time in the future Australians will operate exclusively in that zone. But for the time being the people operating in that zone will be mainly the owners of foreign fishing vessels. That might be the start, middle and finish of Australia ‘s off-shore fishing policy.

I hope that the Minister’s statement is a forerunner to a much more detailed and comprehensive approach by the Government. We do not want just a declaration and a proclamation of the Australian fishing zone but a code for the conduct, negotiation and practice of fishing in this area. My colleague, the honourable member for Hawker (Mr Jacobi), also suggests that the legislation being brought in by the Attorney-General (Senator Durack) to streamline the enforcement of penalties be applied to fishing operators who happen to infringe agreements with Australia. This is also an important matter which needs to be attended to. The surveillance question can no longer be left unattended. An island continent such as Australia with a large coastal area and which is in the throes of declaring a fishing zone- I hope that at some stage it will be a 200-mile exclusive economic zone- must be in the position of knowing what is happening around its coastal territories. Plainly that is not the position at the moment. Rather than worrying about these capital vessels and accommodating those people in the defence establishment who are trying to fit Australia up with superior kinds of vessels which would be more appropriate to military situations in other parts of the world, the Government should be concentrating on what I see as the effective task- the naval establishment may see it as a menial task- of adequate surveillance of the Australian coastal territories. This is a significant step for Australia, and if we move to establishing a 200-mile economic zone that will be even more significant.

They are the caveats which the Opposition puts on the statement at first glance. I hope to take the opportunity in debate to reply to the statement at length. I certainly hope that the Government will list the statement for debate at some later time. Therefore, I seek leave to continue my remarks when the debate resumes.

Leave granted; debate adjourned.

page 1467

ASSENT TO BILLS

Assent to the following Bills reported:

Tasmanian Native Forestry Agreement Bill 1979.

Sales Tax (Exemptions and Classifications) Amendment Bill (No. 2) 1979.

page 1468

INCOME TAX LAW

Discussion of Matter of Public Importance

Mr DEPUTY SPEAKER (Mr Giles:
WAKEFIELD, SOUTH AUSTRALIA

-Mr Speaker has received letters from both the honourable member for Gellibrand (Mr Willis) and the honourable member for St George (Mr Neil) proposing that definite matters of public importance be submitted to the House for discussion today. As required by Standing Order 107, Mr Speaker has selected the matter which in his opinion is the most urgent and important, that is, that proposed by the honourable member for Gellibrand, namely:

The use of the income tax law for party political purposes.

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

More than the number of members required by the Standing Orders having risen in their places-

Mr WILLIS:
Gellibrand

-The Opposition raises this matter of public importance today because we are concerned that an action on the part of the Fraser Government is contributing in no small way to the scandalous developments in Queensland regarding the BjelkePetersen Fund. This is occurring despite the fact that revelations regarding some aspects of the scandalous nature of that fund have been made by members of the . Liberal Party. At the same time we find action or inaction on the part of their federal colleagues in this Parliament resulting in the perpetuation of that scandal and the development of it through the coercion of people into making contributions to the Bjelke-Petersen Fund. This coercion is being applied by means of tax deductibility; that is, the Bjelke-Petersen Fund is being advertised to potential donors as being tax deductible. To this stage we believe that there is every reason to consider that the tax deductibility may well apply to such contributions because this Government has not taken the action necessary to prevent that from occurring. That is of concern to us because we regard this fund as objectionable and scandalous. The Bjelke-Petersen Fund was commenced as we understand it early this year. The objective of the fund was spelt out in a letter which was widely circulated in Queensland by the Queensland State President of the National Party, Sir Robert Sparkes. In that letter he said in part:

Incredible though it may seem, despite the fact that our Party is battling to protect the free enterprise system in which individuals and companies have thousands of millions of dollars at stake our capacity to combat the socialists and the communists is impaired by a chronic shortage of funds.

To overcome this serious financial disability and to pay tribute to Jo Bjelke-Petersen ‘s outstanding efforts to preserve the free enterprise system, it has been decided to establish the Jo Bjelke-Petersen Foundation.

The brochure which I left with you explains in some detail the facts concerning the Foundation. Briefly, the intention is that the funds raised by the Foundation would be invested in buildings in carefully selected centres and the net income that is earned would be employed mainly in two ways.

Firstly, about half would be applied towards the cost of election campaigns.

Secondly, the balance would be largely used to promote the merits of the free enterprise philosophy and generally enhance the effectiveness of the Party organisation in its struggle to preserve the free enterprise system.

It is clear from what is said there by the Queensland State President of the National Party that the objective of this fund is blatantly political.

Mr Holding:

– It is a slush fund.

Mr WILLIS:

– It is a slush fund, as the honourable member for Melbourne Ports said. It is to enable the National Party to improve its standing in Queensland. It certainly needs some shoring up. It plans to buy buildings throughout Queensland. For a $100,000 donation -

Mr Donald Cameron:
FADDEN, QUEENSLAND · LP

– You people financed John Curtin House in exactly the same way. You are hypocrites.

Mr DEPUTY SPEAKER (Mr Giles:

-Order! The honourable member for Fadden will withdraw that remark.

Mr Donald Cameron:
FADDEN, QUEENSLAND · LP

– The Labor Party financed John Curtin House in the same way. It is hypocrisy.

Mr DEPUTY SPEAKER:

-Order! If the honourable member continues to behave in that way I will warn him.

Mr WILLIS:

-As I was saying, for a $100,000 donation a person could have one of these buildings named after him. Gifts are payable over 2lA to 3 years. The campaign has been highly organised. The first edition of National Outlook, which is the National Party newspaper in Queensland, stated:

Targets will be allocated to each electorate or zone. It is planned that electorates with sitting State members will have a target of $60,000 each; those where there is a chance of winning a seat will have a target of $40,000; and those where there is little chance, $20,000.

The metropolitan zones will have a target of $50,000 each . . .

Printed literature and correspondence will be kept to a minimum during this drive as the basis of fund-raising will be person-to-person contact.

There certainly has been person-to-person contact. We understand that there have been approaches by National Party Ministers and members of parliament to potential donors to persuade them to contribute to this fund. Indeed, the Australian Financial Review on 17 July of this year contained an article which states:

Last week Mr Everald Compton, of Compton Associates, professional fund raiser for the Bjelke-Petersen Foundation, confirmed that a National Party minister had personally approached a business colleague for a donation.

Mr Compton also confirmed that individual National Party Members of Parliament were approaching companies in their electorates for donations.

Here it is clearly spelt out by the fund raiser for the National Party in Queensland that Ministers and members of the National Party in that State are making direct person-to-person approaches to companies to make donations. Of course that is approved of by the Premier of that State.

Mr Donald Cameron:
FADDEN, QUEENSLAND · LP

- Mr Deputy Speaker, I raise a point of order. I do not wish to interfere with the current speaker’s address.

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member will proceed to his point of order.

Mr Donald Cameron:
FADDEN, QUEENSLAND · LP

– My point of order is that John Curtin House, the Labor house in Canberra, was financed in exactly the same way. What is the argument?

Mr DEPUTY SPEAKER:

-Order! The honourable member will resume his seat.

Mr WILLIS:

-I believe that the fact I have just mentioned and other facts demonstrate the scandalous nature of this fund. It has been claimed not only by members of the Labor Party in Queensland but also by members of the Liberal Party that improper pressure has been applied on companies to contribute, including the threat of loss of government contracts for noncontribution to the fund. That suggestion is contained in an article in the Age of 10 July 1979 which reported what was said by Mr Warburton, an Opposition front bencher in Queensland. The article states:

Mr Warburton said businessmen were being threatened with victimisation over Government contracts and even being put out of business.

A spokesman for the Opposition leader, Mr Casey, yesterday said the Labor Party had evidence from two companies which had been pressured- one . . . for a $250,000 donation.

The Liberal Party confirmed that it had complaints from four contracting companies- three in Brisbane and one in Central Queensland- involving amounts from $25,000 to $250,000.

The letter by the Queensland State President of the National Party, Sir Robert Sparkes, which I referred to previously, states on the third page:

Your contribution clearly should be viewed not as an act of altruistic generosity but as a sound and very essential investment in the protection of your commercial future as well as our basic democratic life style.

Clearly in that passage there is a kind of threat involved- that it is an essential investment in the protection of the company’s commercial future to donate to the Bjelke-Petersen fund. What could be more clear than the implication that is obviously to be drawn from that- that government contracts and co-operation will depend on such contributions being made. Claims have been made recently by State Liberal members of parliament regarding rezoning of land on the Gold Coast for development purposes, as has been widely reported in recent days, in return for donations of up to $100,000 by a Melbourne businessman, a person who was also an associate of the Minister for Foreign Affairs (Mr Peacock ). At least one $100,000 gift has been made. It is public knowledge that Gold Coast millionaire and ex-National Party member of parliament Sir Bruce Small has made such a contribution. Reports of clubs south of the Queensland border having raised $150,000 for the Bjelke-Petersen fund have also been made. They apparently raised that money as some insurance against poker machines being introduced in Queensland. I want to refer particularly in this debate to the tax attractions of gifts to the fund. In the letter by Sir Robert Sparkes he makes it clear that the National Party sees tax deductibility of gifts to the fund as being an attraction. The letter states:

I reiterate and stress the fact that any individual or company that supports the concept of the Foundation could provide indirect financial assistance in a manner which is tax deductible, provided of course that the supporter has a product or service that can be advertised.

The procedure is for the supporter to purchase advertising space in the Party paper, the ‘National Outlook’, which circulates throughout the State to approximately 25,000 people.

I might say that there have been only three editions of it. It is a quarterly newspaper. The letter continues:

If desired, the outlay can be spread over say three financial years. In the case of a company paying 46 per cent tax, this of course means the actual cost of the assistance is reduced to 54 per cent of the nominal value.

There is no doubt whatsoever about the legitimacy of the advertising approach as far as the Taxation Department is concerned. The Foundation has obtained impeccable legal and accounting opinion on this matter, and it unequivocably confirms that the Taxation Department has no authority to query the ‘value for money’ aspect of the advertising.

Enclosed is a photostat copy of an opinion in support of this contention.

Sir Robert Sparkes is clearly saying there that a contribution can be largely tax deductible. At company tax rates that means a saving of 46c in the dollar of the donation. He also is saying that a donor would not have to worry about the donation not being tax deductible because the National Party has good advice in that regard.

The advice refered to is a decision of the High Court. I will come to that in a moment. It relates to section 5 1 ( 1 ) of the Income Tax Assessment Act. This is the section which relates to deductions for advertising. It does not mention advertising as such but deals with losses and outgoings. All losses and outgoings are dealt with by this section. It states:

All losses and outgoings to the extent to which they are incurred in gaining or producing the assessable income, or are necessarily incurred in carrying on a business for the purpose of gaining or producing such income, shall be allowable deductions except to the extent to which they are losses or outgoings of capital.

That is the relevant section. What the State President of the National Party was saying in the letter is that the High Court supports the view that any expenditure on advertising is deductible under that section. He is relying on a decision in 1 949 as reported in the Commonwealth Law Reports, volume 78. The High Court stated: tt is important not to confuse the question how much of the actual expenditure of the taxpayer is attributable to the gaining of assessable income with the question how much would a prudent investor have expended in gaining the assessable income. The actual expenditure in gaining the assessable income, if and when ascertained, must be accepted. The problem is to ascertain it by an apportionment. It is not for the Court or the Commissioner to say how much a taxpayer ought to spend in obtaining his income, but only how much he has spent.

What the High Court is saying is: ‘We do not decide what is the right amount to be paid in any particular expenditure. That is a matter for the taxpayer to decide. So, if the taxpayer decides to pay many thousands of dollars more than is the commercial value of a certain advertisement, it is not for us to make a decision on that’. That is what is being relied upon by the National Party in claiming tax deductibility for contributions to the Bjelke-Petersen fund. As I understand it, that judgment to which I have just referred- the judgment in the Rompibon Tin case- is the leading authority in respect of section 5 1 ( 1 ). I understand that there have been some cases in which the Commissioner has succeeded in getting the courts to rule that, where a payment was greatly in excess of what was clearly the commercial value of certain outgoings, that would not be tax deductible; but, in general, the decisions have gone the other way, and the Rompibon Tin case is the one which normally applies. So the general run of the law is in favour of what the National Party is claiming, that is, that the contributions to the fund will be tax deductible.

We say that it is incredible that this Government is allowing that situation to continue, where contributions to a blatantly political fund are tax deductible. We have asked questions about this in the past, and we received from the Treasurer (Mr Howard) an answer which was not terribly satisfactory at that time. Only yesterday Senator Colston received from the Treasurer a letter in which he claimed that the Commissioner would take the view, in regard to contributions to the Bjelke-Petersen fund, that these contributions would not be tax deductible if they were in excess of genuine advertising expenditure. I will quote just the last words of the Treasurer ‘s letter:

The Commissioner is of the view that, to the extent that payments to the Foundation do not represent genuine advertising expenditure, deductions are not allowable in the assessments of donors and proposes to take action accordingly.

If the Commissioner is successful in getting that through the courts, then that is fine; but what I am saying to this House is that it is highly unlikely, on the basis of existing tax law, that the Commissioner’s moves in that regard will be upheld by taxation boards of review or the courts, because the whole tenor of the decisions by the courts is not to uphold decisions of that kind by the Commissioner.

So we have the absurd and ridiculous situation that Liberal Party members in Queensland are protesting vigorously about this enormous scandal of the Bjelke-Petersen fund and are pointing out examples of the way in which the whole processes of decent political behaviour in that State are being corrupted by the existence of that fund; but in this Parliament the Government is allowing the tax Act to remain in a form which enables contributions to that scandalous fund to be tax deductible. We say that this Government is duty bound to amend the Act so that such contributions are not tax deductible in the future. Until it does so we must say that it seems to be in tremendous conflict within itself. The Liberal Party in Queensland and the Liberal Party nationally seem to be taking quite different views on just how to treat the Bjelke-Petersen fund. It is simply not good enough to rely on the view taken by the Commissioner of Taxation in this matter. He is constrained by the law and the law is not going to support him.

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member’s time has expired.

Mr KEVIN CAIRNS:
Lilley

-When members of the Opposition were running around looking for a title for their matter of public importance they looked at page 5 or 6 of today’s Melbourne Age and thought: ‘There is a line that we want to run’. So they have come up with this proposition in their matter of public importance. I suggest, rather sadly, that the honourable member for Gellibrand (Mr Willis) has made himself a hireling in this matter. What he has said is contrary to common sense and to the practices of the Labor Party. Let me point out just one or two matters. I have no knowledge of the Joh Bjelke-Petersen Foundation Fund. I do not know those who have contributed to it, and I do not know what people intend to do with it. But I do know that when John Curtin House was opened here in Canberra there was a suggestion that section 51(1) of the Income Tax Assessment Act ought to be enshrined in the front foyer because it had been so beneficial for those who had raised the money for that building. I will read out that sub-section:

All losses and outgoings to the extent to which they are incurred in gaining or producing the assessable income, or are necessarily incurred in carrying ona business for the purpose of gaining or producing such income, shall be allowable deductions except to the extent to which they are losses or outgoings of capital, or of a capital, private or domestic nature . . .

That provision has been in the Act for very many years, while Liberal-National Country Party governments and Australian Labor Party governments have been in power. Neither of those brands of government proposed to alter the Act. Yet members of the Labor Party come into this House and put forward this absurd and nonsensical proposition. In regard to this proposition one or two points ought to be made. They are simply that whether the money that is paid by some contributor to a fund is tax deductible remains a matter of confidentiality between that person or organisation and the Commissioner of Taxation; and, if tax deductibility were not granted, no doubt people would then have the right to appeal on the basis of that section of the Act. I do not know whether there have been any appeals or not, but I do know that the matter of tax deductibility is one of confidentiality. The Commissioner of Taxation has a discretion in determining that matter. I do not want to be provocative in this debate, but I mention in passing that the discretion which members of the Labor Party would give to a Commissioner of Taxation is greater than that which they would give to the Director-General of the Australian Security Intelligence Organisation. So confidentiality and the right of appeal remain. There was a legitimate attempt, which would have been a noteworthy one, to enshrine that section of the Act in the foyer of John Curtin House.

I go a little further and say that I am puzzled as to why the Labor Party has brought forward this matter of public importance. Does the Labor Party want to destroy its own advertisers? A few moments ago I had the privilege of looking through a Labor Party journal known as the Labor Star of Victoria. It is put out by the Victorian Branch of the Australian Labor Party and is nominated as its official journal. Under certain circumstances, advertising in that journal could qualify for income tax deduction. I suggest that before members of the Labor Party bring forward a matter such as this, they contact a few organisations and a few people to see whether tax deductions for advertising in that journal is to be eliminated. For example, they might contact one of the multinationals in Australia- Lever and Kitchen Pty Ltd, which is not a small business and which has an advertisement in that journal. It is legitimate to ask: Is that advertising a tax deductible item? Does it qualify? Has the honourable member for Gellibrand asked? Has he protested against the very fact that the company might even consider it to be a tax deductible item? In the same journal there is an advertisement for the Australian Labor Party’s economic policy with a couple of clever graphs spread over a couple of pages.

When I looked through that economic policy, nowhere could I see the proposition that section 5 1 ( 1 ) of the Income Tax Assessment Act was to be altered, repealed or abolished. So, Mr Deputy Speaker, you can understand my puzzlement and why I arrive reluctantly at the opinion that today the honourable member for Gellibrand has made himself rather a hireling for some tired and worn out political campaign. I have looked through other journals and in those journals I find that Amalgamated Wireless (Australasia) Ltd has advertised. Did members of the Australian Labor Party ever check whether that would be a tax deductible item or did they say: No, we are going to raise this matter in the Parliament on Tuesday; so get in for your cut because next week you may find that it is no longer a tax deductible item ‘.

I do not know whether Philips Industries Holdings Pty Ltd is a small show. I think it is a rather large business. It is probably based in Victoria; so it could be a large business. Was that a tax deductible item? Those of us who come from the north merely ask our colleagues in the southern States to bring a little consistency to the argument and apply the same rule across the board fairly and honestly. In one of the same journals is an advertisement for the International Year of the Child. I think that ultimately some Commonwealth money is involved in the International Year of the Child. That may attract some form of tax deductibility that will excite the imagination of the honourable member for

Gellibrand. He will say that we should not allow it.

In this discussion the Opposition made one or two serious errors. I will mention one or two other matters in passing as a glancing blow. It seems that the people who are raising money for the Bjelke-Petersen Foundation are the same people who raised money for John Curtin House. But there was an extra rake-off in relation to John Curtin House. The Labor Party was in Government at the time and it leased John Curtin House back from itself. Its members wore two different hats around the same conference table and passed leasing arrangements from one side to another. Would the Joh Bjelke-Petersen Foundation dare to come at that kind of manipulation? Criticism is always valid; we merely ask that there be a certain area of consistency in the criticism.

I turn to the points that have been made by the honourable member for Gellibrand. There is confidentiality with respect to tax deductible items. There is a right of appeal if certain people feel that a contribution should not be tax deductible. The section of the Income Tax Assessment Act which has been quoted by the honourable member for Gellibrand and which may or may not have been used by those who have contributed is the same section which the Opposition administered when it was in government. It is the same section under which people contribute to Labor Party journals and then claim tax deductibility for those contributions. The same fund raiser was used for John Curtin House, with the added bonus on that occasion that the Labor Government leased the building.

The title of this matter of public importance, The use of the income tax law for party political purposes’, is very important. The most dreadful party political purpose for which an income tax Act could be used would be to make a dependent economy, whether by way of tax deductions or income tax rates. The Government is being accused of allowing a section of the Act to operate which ought not to operate. That accusation has been made by those who, during their three years in power, led the world in the rate of increase of tax which they collected from the Australian people. Let me recite one or two figures. I do not like reciting too many on an occasion such as this. Of the 23 industrialised countries in the world in 1972 Australia had the third lowest rate of increase in the taxation take. During the next three years Australia led the world. In 1973 it was first. In 1 974 it was second. In 1 975 Australia slipped momentarily to fifth place. On that occasion it was beaten by Malta, Turkey and other such grand nations.

Those who concern themselves with income tax ought to look at their own record. After all, the record is clear as to what they did. Their intentions were obvious. The accusation is being made of the Government by the person who a few years ago said:

The Leader of the Opposition has claimed recently that in this financial year the Australian Government will collect 36 per cent more in income tax than it collected last year. This figure is quite incorrect as I will demonstrate shortly … In Tact, the 36 per cent is quite erroneous. If we do the sum properly it will be seen that in fact the increase becomes 32 per cent.

That was the advice given in this House on 19 March 1974 by the gentleman who introduced this matter into the House today. We can legitimately ask- we ought to do so- whether the Opposition is really serious about income tax. Is it really serious about the tax take? Opposition members will say: ‘Do not take much notice of what we did in the past. That is all over and forgotten. We would not do it again.’ That reminds me of the anthropologist who visited a tribe of cannibals in Africa. He said to the head man: ‘I am told that you still follow that disgusting habit of cannibalism. Is that so?’ ‘Oh, no,’ said the chief, ‘We consumed our last man yesterday.’ Does anybody believe, therefore, the plea of innocence made by the Opposition in respect of income tax? Does anybody believe that it would not consume the taxpayer the next time it was in power as it did during the three years it enjoyed power from 1972 to 1975?

I return to where I began in relation to this matter of public importance. The Opposition is worried about the Bjelke-Petersen Foundation. It says that it is concerned about a section of the Income Tax Assessment Act. I presume that that section of the Act is being administered in the same way as it was during the time that the Opposition was in power. I suggest also that the benefits, directly and indirectly, to the Opposition from the administration of the Act when it was in power were greater than they are in respect of this Foundation in Queensland. Opposition members know that what I say is totally and absolutely correct. The matter ought to be looked at in that way. This matter of public importance ought to be rejected. The Opposition is hypocritical and guilty of double standards. The honourable member for Gellibrand ran a story today that does not hold water. It is a disgraceful matter of public importance. Above all, the honourable member for Gellibrand has made the worst mistake of taking his lead from a story probably written by a cub journalist of the Melbourne Age.

Mr HUMPHREYS:
Griffith

-I must admit that I have a great deal of respect for the honourable member for Lilley (Mr Kevin Cairns) but I am completely amazed that a prominent member of the Liberal Party can stand in this place and defend the Joh BjelkePetersen slush fund. It is absolutely incredible. The honourable member for Lilley knows full well what the Premier of Queensland is doing with his slush fund. That he can be so hypocritical and support the Premier of Queensland, the National Party and its slush fund is absolutely amazing. The honourable member for Lilley denigrated John Curtin House, named after a famous Australian, yet he stood up for Joh Bjelke-Petersen who will go down as the most notorious and corrupt Australian ever to enter the political sphere.

Today we are debating the use of the income tax law for party political purposes. That is the main argument. This matter began on 2 April when Mr Bjelke-Petersen told a gathering of 300 party faithful at the Cloudland Ballroom in Brisbane ‘The 21st century belongs to us’. The occasion was to launch the Joh Bjelke-Petersen Foundation which is aimed at raising $2. 5m to keep the party afloat financially and expand its activities in the 1980s. I wonder what sort of activities they are. Are they the land deals, the Iwasaki deals or deals to drill and mine the Great Barrier Reef? The Minister for National Development (Mr Newman) may know whether Joh has done any deals regarding the mining and drilling of the Great Barrier Reef.

There has also been a donation of $100,000 from Sir Bruce Small. I wonder how many advertisements he will get for $100,000. The newspaper is brought out only four times a year. It will be a classic advertisement. But Sir Bruce Small did get to have dinner with Joh BjelkePetersen. I do not know whether Mrs BjelkePetersen was there. A person can have dinner with Joh for $25,000, just as Mr Keith Williams of the Gold Coast did. I shall read a little from an article about Mr Keith Williams as published in the Sunday Mail of 12 August. The article states:

Millionaire Gold Coast entrepreneur Mr Keith Williams is being paid $10,000 a year as chairman of the recentlycreated Gold Coast Waterways Authority.

So Mr Williams is being paid $10,000 a year. In April of that year Mr Keith Williams donated $25,000 and had dinner with Joh BjelkePetersen. He is $5,000 in front already and if he is re-appointed -

Mr DEPUTY SPEAKER (Mr MillarOrder! I remind the honourable member for Griffith that to date his remarks have not altogether related to the subject of the matter of public importance before the House. I would like him to address himself more pertinently to the matter.

Mr HUMPHREYS:

-Mr Deputy Speaker, I make the point that in a letter from the State President of the National Party it was pointed out that these donations were tax deductible. I shall read that letter to you very shortly. I am making the point that Mr Williams donated $25,000 in the hope, I am sure, that that money would be tax deductible. Strangely enough, Mr Williams finished up with a $10,000 a year job. That job is for three years. That is very amazing. One could probably say: Pay the price and name the prize.

It is very interesting also that Mr Rice donated $100,000 to the fund. Here we have a prominent member of the Victorian Liberal Party donating $100,000 to the National Party in Queensland. Why would Mr Rice be donating $ 100,000 to the Joh Bjelke-Petersen slush fund? I wonder why. I think that Mr Rice also thought that his donation of $100,000 would be tax deductible. I wonder whether it is true that Mr Rice tried to stop people in Victoria from reading all about his donation of $100,000 and the allegations that he paid that $100,000 for a few favours. I ask you once again, Mr Deputy Speaker: Why would a prominent member of the Liberal Party donate $100,000 to the Joh Bjelke-Petersen fund when he has very good friends in the Minister for Foreign Affairs (Mr Peacock) and other Ministers from the Liberal Party. Mr Rice is a very interesting chap. I am glad to see that the people of Victoria can now read what has been stated in the Queensland Parliament.

Mr John Brown:
PARRAMATTA, NEW SOUTH WALES · ALP

– What about the fellow who got the knighthood last week?

Mr HUMPHREYS:

-One can buy a knighthood. They are cheap enough. One does not have to pay $25,000 for them. What we are all about here today is the use of the income tax law for party political purposes. In this regard I read part of a letter from Mr Sparkes. It states:

I reiterate and stress the fact that any individual or company that supports the concept of the Foundation could provide indirect financial assistance in a manner which is tax deductible, provided of course that the supporter has a product or service that can be advertised.

The procedure is for the supporter to purchase advertising space in the Party paper, the ‘National Outlook’ . . .

I think that newspaper is produced four times a year. It is quite interesting to note that one can pay $100,000 for advertising space in that newspaper. That would pay for a quite substantial advertisement. It would probably take up the four pages of the newspaper. I wonder what sort of advertisement Mr Rice will put in that newspaper?

Mr Holding:

– That would be interesting. It would probably be about Kentucky fried chicken. That is what he brought to Victoria.

Mr HUMPHREYS:

-As my colleague has pointed out, the advertisement would probably be about Kentucky fried chicken. I quote further from the letter which, I remind the House, is from the State President of the National Party in Queensland:

There is no doubt whatsoever about the legitimacy of the advertising approach as far as the Taxation Department is concerned. The Foundation has obtained impeccable legal and accounting opinion on this matter, and it unequivocally confirms that the Taxation Department has no authority to query the ‘value for money’ aspect of the advertising.

Enclosed is a photostat copy of an opinion in support of this contention.

I also have here a copy of a letter which was sent to Senator Colston by the Treasurer (Mr Howard). I would be only too happy to table the letter. I do not know whether the honourable member for Gellibrand (Mr Willis) did so during his speech. I will not bore the House by reading the whole letter; I shall quote only part of the letter. It reads: . . the allowance of deductions for outgoings to the extent that they are incurred in gaining or producing a taxpayer’s assessable income or are necessarily incurred by a taxpayer in carrying on a business for that purpose, except to the extent that the outgoings are of a capital, private or domestic nature.

The Commissioner is of the view that, to the extent that payments to the Foundation do not represent genuine advertising expenditure, deductions are not allowable in the assessments of donors and proposes to take action accordingly.

So here we have a letter from the State President of the National Party saying that he has complete evidence from accountants and solicitors that these donations are tax deductible, yet we have the Commissioner of Taxation saying that they are not. Who is right? What is going on in Queensland? Are these people donating to the National Party to keep the terrible socialists and communists away from under their beds? Are these people donating to get advertisements in the Press, are they donating to get favours in connection with land deals and so on, or are they just donating so that they can keep Joh BjelkePetersen and his slush fund going and contribute to Mr Hinze ‘s world tours? I think it is absolutely disgraceful that we can have this sort of thing going on in Australia today. As I say, it is absolutely disgraceful and can only be deplored by honourable members on this side of the House and by the people of Australia.

Mr KATTER:
Kennedy

– I find myself at a considerable disadvantage for two reasons. The first is that I have some very cruel evidence that I propose to put before the House, evidence which I gained over a period of many years as a former member of the Australian Labor Party. But the honourable member for Gellibrand (Mr Willis) and the honourable member for Griffith (Mr Humphreys) are fairly nice blokes, so perhaps I should go a little bit easy on them.

Mr Jull:
Mr KATTER:

– I am tossing up as to whether I should. Let us deal first of all with the question of breakfasts. Do honourable members recall the famous breakfast involving the Australian Labor Party? It does not mess around when it comes to making financial deals that could be a little questionable. Financial deals that would put this country into hock with the Arabs for, I think, $40 billion would not be of great consequence to the Labor Party. I come now to the subject of the political organisation about which the honourable member for Gellibrand read out a letter. I was sitting here straining at the leash, trying to detect something shabby or shoddy about Sir Robert Sparkes ‘s letter. I could not see anything in it.

I represent an electorate which is not an electorate of great privileged people. We have a few great mining companies and perhaps a few great squatter organisations. But I represent an electorate of battlers, ordinary working class people. I represent industrial areas. Two great men issued one very clear edict to me when I entered political life. One of those men was John McEwen. They said to me: ‘Above all, keep your nose clean’. Let me say to this House and to this nation that if I were to have clear evidence, even a shred of evidence, that the senior members of my party were associated with a scandal of great magnitude and of this nature, not for one moment would I be speaking to this motion. I would have to look at the whole of my party affiliation. Let me make that quite clear. Furthermore, if I were to detect that some people were to gain affluence or influence unjustly because of a contribution to a political party, again I would have to look at my particular situation and my party loyalties.

Time and again members of the Labor Party bring forward these sorts of matters with monumental media backing. It is becoming old stuff in Queensland. It is a matter of asking: ‘What is the scandal for today? There was one at breakfast time but there is a new one by lunch time.’ But they all fizzle out. Labor Party supporters say that they will produce evidence and affidavits. Russel Hinze is coming back. He had what I think is a pretty attractive itinerary. He is coming back to answer charges that the Australian Labor Party is stimulating.

I refer to the John Curtin House Fund. Not for one moment did the honourable member for Lilley (Mr Kevin Cairns) suggest that this was not a great fund in itself. If my memory serves me correctly, prominent members of all parties supported the John Curtin Fund. Incidentally, where has the honourable member for Griffith, who represents a Queensland electorate, gone? There is not one Labor man in the House.

Mr Leo McLeay:
GRAYNDLER, NEW SOUTH WALES · ALP

– Yes, there is.

Mr KATTER:

-There is. I pay credit to the honourable member for Grayndler. He has the courage to sit in the House and listen to these facts. But if I were to read some of the facts the members of the Labor Party would not be leaving the House- they would be leaving the country because of my knowledge of what they have done. The ultimate in contempt is to withdraw funds from pensioners and Aboriginals. I will not say any more at the moment on that subject, but these people on the Opposition side were prepared to exploit the underprivileged.

Mr Jull:

– The Australian Labor Party?

Mr KATTER:

-Yes. The Australian Labor Party was prepared to exploit the underprivileged to raise party funds. In regard to the John Curtin Fund, I thought that the honourable member for Lilley made an outstanding contribution in this discussion on a matter of public importance because he was not emotional. He merely asked a very simple question. He asked: What is the difference between the two fund raising operations?’ Well, what is the difference? The Australian Labor Party organ The Star, or whatever it is called, goes to such underprivileged organisations as Amalgamated Wireless (Australasia) Ltd which contributes to advertising. So where is the difference if someone contributes to the Joh Bjelke-Petersen Fund? I have a huge electorate. I am kept terribly busy. I do not know much about the Fund but I do not think for a moment that anyone associated with the Fund has hidden anything. On every occasion that there is a great tirade of abuse and a great media move against Bjelke-Petersen he has one simple request: ‘Well, bring forward your evidence. If there has been a shady deal down on the Gold Coast, okay, let us have it investigated and let us look at the whole thing’. I repeat that if my Party had defaulted, if the leaders of my Party were proven to be a lot of Godfathers and a lot of Mafia type operators I would find it difficult to remain as a member of the Party and I certainly would not be speaking in this discussion.

The allegations made by Australian Labor Party supporters have no substance whatsoever. They have brought forward this discussion apparently because of something they read in the Age. I do not know what stimulated this discussion. May I say that Labor’s contribution in this place today was pretty weak, even in trying to sustain the argument that there is some great skulduggery operation. What I do know is that a Bjelke-Petersen Foundation Fund dinner is to be held in my electorate. I know it has been advertised and I know that all sorts of people are going along to it.

Mr Leo McLeay:
GRAYNDLER, NEW SOUTH WALES · ALP

– Did they invite you?

Mr KATTER:

-I do not know that they did, to be honest. I am not sure that they did. The people of South Australia gave a very clear and precise judgment in relation to this matter. Are honourable members going to tell me that the people of South Australia represent the AW As of this country or the great overseas companies? Were there enough of such people in South Australia to give a devastating defeat to the Labor Party? The former Labor Party Premier in that State, Mr Corcoran, is a fine man. I have never heard a word said against him. He is a good family man. But the judgment of the workers of South Australia was that their whole future was in jeopardy because of the scurrilous mud-slinging activities- this very type of operation that we are discussing today- which had not been sustained. Honourable members will recall the Prime Minister (Mr Malcolm Fraser) in this House giving figures on the number of occasions that the Leader of the Opposition (Mr Hayden) claimed that we on this side of the House were all sorts of weird operators and that almost everyone was a criminal or semi-criminal. Those allegations were never sustained. They always petered out and fizzled out. But the Labor Party has kept at it. What was the judgment of the people of South Australia? They got to thinking for the first time and they said: ‘Okay, unless we have the sort of thing that this Joh BjelkePetersen fund claims it will provide, that is, getting the financial vitality that is necessary to sustain the sort of philosophy that has made Queensland the mecca of Australia, there has to be a change’.

If all this alleged skulduggery and crooked dealings are going on why are decent people flooding into Queensland? Do they want to be associated with the Mafia and Godfather-type activities, with Joh Bjelke-Petersen as the Godfather? Surely honourable members opposite do not believe these people are rushing to Queensland to be associated with that sort of operation. The people in South Australia have made their judgment. The same thing will happen at the next Federal election. The members of the Labor Party are using all sorts of desperate measures. They are bringing in Bob Hawke. The moment Bob Hawke becomes a member of this House he will be just another member. Look at what has happened to the big shots who have become members of this House. The honourable member for Lalor (Mr Barry Jones) was a great national figure but the moment he became a member of this House he was just another member of the Australian Labor Party. He is not even a member of the front bench. The same will happen to the great Bob Hawke. The media that he insults and treats with contempt crawl to him and cringe because they think they have a great winner- someone who can knock over big Mal. They are fools; they are idiots. I am sad to see my good friend the honourable member for Griffith and the honourable member for Gellibrand associated with this ridiculous and unsubstantiated discussion of a matter of public importance.

Mr DEPUTY SPEAKER (Mr Millar:
WIDE BAY, QUEENSLAND

-The discussion is concluded.

page 1476

APPROPRIATION BILL (No. 1) 1979-80

Second Reading (Budget Debate)

Debate resumed from 13 September, on motion by Mr Howard:

That the Bill be now read a second time.

Upon which Mr Willis had moved by way of amendment:

That all the words after ‘That’ be omitted with a view to substituting the following words: ‘whilst not opposing the second reading, this House condemns the Fraser Government for presenting a budget which-

reduces the real living standards of Australian families:

will increase unemployment to the highest level in the nation’s history;

facilitates and stimulates the recent fresh outbreak of inflation;

ensures that economic growth will be well below the nation ‘s productive capacity;

fails to introduce an effective job creation program, particularly for the young;

savagely reduces the allocation of funds for job training and re-training program;

will be responsible for the highest level of tax and total revenue collections in the nation’s history;

forces State and local governments either to reduce their services or increase their charges, and

intensifies the lack of credibility of the Prime Minister and his government and adds to their long list of broken promises’.

Mr Ian Robinson:
COWPER, NEW SOUTH WALES · NCP

-The Budget, whilst tough and uncompromising in its anti-inflationary intent, provides for lower tax rates from December and twice yearly pension increases. Business and industry are assisted with the increased retention allowances for trading or business income- up from 60 per cent to 70 per cent- and tax depreciation on buildings for tourist accommodation has been introduced for the first time. Tax concessions to encourage energy conservation are also of great significance. The bench-mark for assessing Budgets differs from the position which existed a few years ago. When inflation is low and near full employment is possible the Budget criteria are vastly different from the present situation of acute inflationary pressures. A few years ago a good Budget was one that was popular with the community. Today a good Budget is one that recognises and responds in a realistic way to the nation’s problems and needs, whether or not that response is popular. There is a tendency to judge Budgets on the basis of ‘What’s in it for me?’, based on the idea that handouts are the main expectancy. On balance, this year’s Budget is fair to all sections of the community.

In this debate two weeks ago the honourable member for Grayndler (Mr Leo McLeay) delivered his maiden speech. I congratulate him on the content of his speech. In fact, if one looks at the record of speeches that have been delivered thus far in this Budget debate they will see that at least the honourable member has been honest in his references to the enormous cost of providing social security benefits in this country today. The honourable member cited some very pertinent figures. He indicated, for example, that the number of people supported for every thousand taxpayers today is vastly greater than it was 10 years ago. I believe that the Budget and its import, in addition to the economic climate, have to be considered separately from the stance of what are the inescapable demands of responsibilities upon the government of the day, and the area of social security is certainly one of them.

The Budget is designed to reduce inflation and promote sound and broadly based economic growth, to provide incentives for both individuals and business within a reasonable framework of the longer term economic growth requirement and, of course, to reduce significantly the demands of government on the country’s financial markets. If we are to reduce the deficit to a sensible level, there is a very great need to ensure that finance is not just pumped in to bridge the gap and to meet the deficit each financial year. The current Budget extends the Government’s commitment to assist the needy and the disadvantaged. It will equip Australia to succeed in a world environment of rising inflation and intensifying competition. It is for that reason also that there are special provisions for export incentives, special provisions to take account of what must be regarded as a sound business approach to the needs of the total economy.

Inherent in all of this is the responsibility of turning attention to employment. Of course, there is vast unemployment, an unacceptable level of unemployment, unemployment that worries the Government and any thinking Australian. It is pleasing to see that there has been an improvement in terms of new and permanent jobs which, of course, is one of the main aims of the present Government. Employment has started to increase. During the past year 64,000 new jobs have been taken up in civilian employment. This is in contrast with the Government’s positive policy of holding down the size of the Public Service. There are obvious and sound reasons for that policy. Productive sections of business, industry, mining and rural pursuits have started to expand job opportunities. Job training schemes which are financed by the Government’s various proposals and which are now in operation have helped nearly 500,000 people to get permanent jobs. About half a million people are better trained for employment in this country. Of course, unemployment continues to be the biggest single problem with which the Government is faced. It has brought stability to the economy by sticking firmly to the policies of economic restraint. Growth and productivity are now being encouraged by these measures, which will certainly help to boost employment.

The honourable member for Hughes (Mr Les Johnson) made criticisms and used the phony story about increased taxation. It is interesting that apparently he and so many others have just discovered that even though tax rates will be reduced there will be a greater collection of taxation. There is no mystery about that. It is being asserted that people will be paying higher taxes. This is not the case. More people getting jobs, more people with higher pay and the total spectrum of this progression means that the total tax revenue will increase, but of course, the Government’s outlay will increase at the same time. The important consideration is just where the deficit has been accounted for in this situation. The internal deficit will be down to about $800m. This is a tremendous achievement. There is no doubt at all that one salient point which worries the Opposition is that the Government has been able to produce a Budget which gives us a real chance of beating the deficit, of getting the deficit to a manageable size. Succeeding Budgets can be foreseen as the means of getting rid of this enormous deficit which has been a burden on the economy for five years or so.

There is no doubt that events since the Budget was announced have proved conclusively that the community is conscious of what is occurring. If we want any real evidence of that, let us look at the situation in South Australia where there was a massive election campaign a few weeks ago with emphasis by the Labor Party on unemployment and by other sections of the community on the very elements of this Budgetwhat it was doing and what it could do- and the need for State administrations to complement the approach being made by the Federal Government. The ballot box revealed that the people see very clearly what is best for Australia.

Mr McVeigh:

– Was the Leader of the Opposition in that campaign?

Mr Ian Robinson:
COWPER, NEW SOUTH WALES · NCP

-I understand that he was rather hesitant about it in certain respects. He wanted to be there to be the knocker of the Federal Government, but that was a dismal failure. We now know the result, lt is very interesting to recall that many assertions have been made in this House of broken promises by the Government. In truth, this Government has an excellent record. Let us have a look at that record. Let us look at some of the promises that have been kept. We promised major tax reforms and they have occurred. If the policy of the Leader of the Opposition (Mr Hayden) were still in operation, the total level of taxation would be astronomical compared to the present level under the reformed tax system that has been implemented by this Government. There were many other promises, and they have been kept. We promised to help local government. This has had an enormously useful effect on every home owner, every average citizen in this country. It is an effect for the better because it has helped to hold down rates. It has helped so many communities by enabling betterment schemes to be introduced, employment giving schemes to be implemented by local authorities. That is a promise which this Government made and kept. In the next Budget it will raise still further its allocation to local government. A firm undertaking in that direction has been given. Many other facets of the Budget are helping small business, farmers and the average citizen. I believe that that is being very widely recognised. I have never known a Budget of which there was so little criticism.

The Opposition has been striving ever since the Budget was brought down to find some valid criticism. It has failed dismally to do that. I remember that the Deputy Leader of the Opposition, the honourable member for KingsfordSmith (Mr Lionel Bowen), made a powerful speech, I think in the second week in August, just before the Budget was introduced. The theme of the speech was that it is too late for the Prime Minister (Mr Malcolm Fraser) to smarten up. He caught the headlines with that speech. He spoke about all sorts of dire consequences for the economy and so on but I am afraid that his thesis has suffered a very severe denting and he is not able to sustain the assertions that he made at that time.

In summary, some of the most important provisions of the Budget are that, as I mentioned a moment ago, the income tax surcharge will end on 1 December and that twice-yearly indexation of pensions has been restored. These are two great issues that the Opposition has used in the past year notwithstanding the reasons and the background for the Government’s decision to maintain the tax surcharge at the end of June. The reasons, of course, were quite clear. They have proved to be valid reasons. They have proved to be in the best interests of all sections of the community. I mentioned that there will be additional help for the tourist industry.

I believe that it is one area in which we find a very great need to look at the total scene. There was a clamour for the reduction of air fares for flights to and from Australia. A very great deal of credit deservedly goes to the Minister for Transport, the honourable member for Gippsland (Mr Nixon) for achieving a reduction. There was a lot of criticism of his actions in the early stages of his negotiations, but now we see the results of that endeavour paying off. The figures speak for themselves. The inflow of overseas tourists into this country has already begun to give the economy of tourist areas, particularly the north coast of New South Wales, a very useful and timely boost. Only at the weekend I saw figures produced by the tourist authority at Port Macquarie which show very clearly that there has been an impact on tourism in that area. It is proper that the Government decided it was timely to provide an incentive in this Budget for the construction of tourist accommodation in Australia. A provision for tax depreciation on buildings to accommodate tourists has been provided for the first time.

Perhaps it could be said that the rural sector was not given a vast handout on this occasion. But the provision of funds has been sustained and there has been an increase for roads, local government and for some other specific purposes. In addition, the special allowance for grain storage on farms was introduced to cope with the enormous stock of grain that one finds throughout Australia at present. On top of that, $2 1 5m was provided for export incentives. Much of this will assist industries beyond the primary industry field. It has to be remembered that if trade around the world is to be encouraged, effectively and usefully, we should take into account not just one or two items but should encompass a broader approach. Whereas these incentives apply to specific industries, they are also indirectly assisting other industries from which bulk commodities flow to overseas markets and a build up of Australian commercial enterprise and activity throughout the whole of the export field. If we think in terms of the development of our great mineral and other resources, we see that what is being done, encouraged by the Government’s approach to the economy, is of tremendous significance. Already we are seeing useful results so far as employment and the economy are concerned.

In the short time available in a debate of this kind one is not able to refer in great detail to a great range of matters. One matter of significance that I do want to mention is the Government’s sustained support for education. I mention this because I have found some sections of the community being flooded with propaganda which asserts that the present Government has cut funds for education. If we make an appraisal of total funding for education it can be seen that the criticism is unfounded and misleading. Undoubtedly the criticism is politically motivated and quite deliberately activated. In the last three financial years recurrent funds for all government schools in Australia rose by 17 per cent in real terms after adjustment for inflation. However, school enrolments in that same period rose by only 3 per cent. Therefore, per student there has been a huge increase in public spending thus enabling a further major expansion in education. In the six-year period of 1972 to 1978 the government school teacher work force- that is all governments- increased by 3 1 per cent while the student population rose by only 6 per cent. Our pupil-teacher ratio is now comparable with that of any other country. That is not a bad achievement.

During the past decade capital expenditure on government schools has aggregated $4,000m. That is the sum invested by tax payers in the education system. The resource targets set by the Australian Schools Commission have been passed and in some instances are running two years ahead of time. When we consider total funding for education including recurrent funding, we find that 5.6 million taxpayers in Australia are contributing no less than $6,000m a year to education. That is about $1,000 for the taxpayer. I think that the taxpayer’s contribution deserves to be recognised. One hears a lot of criticism of the cost of health services and the cost of contributions if one is fully covered in a medical fund. One can completely cover one’s family under a health scheme for all eventualities for less than $ 1 ,000 a year. There are other comparisons that could and should be made.

One hears little of what might be termed effective evaluation. It is not a matter of comparing one thing with the other and saying one is more important than the other. I rate health and education as being pretty equal basic needs in this community and pretty equal basic rights. I think that if there is to be justice for all then these two areas should be seen in parallel and should be given some recognition in unison. It is for that reason that I mentioned those figures in today’s debate.

I conclusion I want to say that the Government has acted courageously in this Budget and in the two preceding Budgets introduced in this Parliament. I am sure that the results speak for themselves. We have seen an improvement in the economy to the benefit of all sections of the community. We have real hope for the future. That hope seemed a long way off only a comparatively short time ago. It will be seen to grow in abundance as a reward for those who support the philosophy of the Government at this time.

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

Mr HURFORD:
Adelaide

-I support the amendment moved by the honourable member for Gellibrand (Mr Willis) to the motion for the second reading of Appropriation Bill (No. 1) 1979-80. 1 remind the House of the terms of this amendment because it is now over a week since the Budget was last debated in the House. This amendment sums up most succinctly the attitude of the Australian Labor Party, the Opposition, to this Budget. We do not have the numbers to oppose the Budget and bring the Government down as we would like to do. So our amendment reads: whilst not opposing the second reading, this House condemns the Fraser Government for presenting a budget which-

  1. reduces the real living standards of Australian families;
  2. will increase unemployment to the highest level in the nation’s history;
  3. facilitates and stimulates the recent fresh outbreak of inflation
  4. ensures that economic growth will be well below the nation’s productive capacity;
  5. fails to introduce an effective job creation program, particularly for the young;
  6. savagely reduces the allocation of funds for job training and re-training program;
  7. will be responsible for the highest level of tax and total revenue collections in the nation’s history;
  8. forces State and local governments either to reduce their services or increase their charges, and
  9. intensifies the lack of credibility of the Prime Minister and his Government and adds to their long list of broken promises’.

At the outset, I will disclose my basic attitude to the role of government because it is on this that I shall build the ideas that I will convey in this speech on the Budget. On one hand I reject an abdication to market forces and on the other hand I reject universal State control. In other words, I reject the proposition that we can or should seek to achieve in this day and age anything approaching a totally free enterprise economy without any government involvement. That would mean no tariffs, no subsidies and no pensions- no government involvement whatsoever. In the same way, I reject the proposition that we should have a communist state, which is at the other end of the spectrum. The formerthat is, the totally free enterprise economy that some people still pay lip service to- assumes that we can return to the early days of the industrial revolution, laissez-faireism, when there was even more inequality, even worse living conditions, and even more exploitation of people than we have today.

As I mentioned earlier there are still people who pay lip-service to the attitude that we ought to have no government involvement and a complete market economy. There are still people on the conservative side of politics who pay lipservice to that, but I hope that this abdication to market forces alone is gone forever. Similarly, let us hope that we shall never suffer universal state control in this country. Along with it goes a lack of personal freedom. We of the Australian Labor Party fight for individual liberties. We reject the system of the communist states which suppress those liberties. We value our freedoms and we mean to preserve them. We social democrats or democratic socialists- in other words, we members of the Labor Party- believe that people do best if they operate in a mixed economy, that is, a private business sector operating in partnership with a government sector, in which the operation of market forces is controlled by the government either through legal rules or through direct intervention. The legal rules include the tariffs that I mentioned earlier and bounties. Direct intervention includes public enterprises such as Trans-Australia Airlines and the State government insurance offices.

The great questions- in fact, the only questions in my view- are: Where should the boundaries be set in particular cases? Democratic socialists will decide these issues in a pragmatic way on the merits of each case. Of course this is a pragmatic approach, and rightly so. I defend it as such. It is a pity that the Budget we are debating is not a more sensible, pragmatic document. Instead, because it is built on false premises, it gets itself tangled in such knots that it causes all the difficulties- one might even call them disastersset out in the amendment which I took time to read to the House, such as a reduction in living standards, more unemployment, deepening recession, a higher level of tax- the highest ever level of tax- and more inflation. I could go on. Basically, the Government has adopted the attitude that the only way to prosperity is through poverty. That attitude is as outdated as the one that for any medicine to be good it must have a rotten taste.

A prominent Liberal- I refer to Mr Bill Wentworth, a former honourable member for Mackellar- summed up as well as anyone in recent years the attitude on which the Fraser Government has built its policy, which is a bad policy, by saying that through stagnation comes salvation. That is the Fraser Government’s approach. That was the Fraser Government’s approach when Mr Wentworth was a member of this House. He criticised and rejected that approach. I reject that approach, as does the Labor Party.

The basic belief of the Fraser Government is that the only way in which to achieve a reduction in inflation and thus make us more competitive is to put a lid on the economy and create more unemployment. We of the Labor Party reject that approach. Of course we agree that we have to make this country more competitive. If we want to achieve full employment and a rising standard of living for ordinary Australians- the Labor Party wants to achieve those things- we must bring inflation under control. We must be able to compete against imports without raising the tariff. Raising the tariff adds to costs. That means more outgoings from the pockets of people and less for them to spend on other goods and services. If there is less for them to spend on other goods and services it means that less employment is being created in other areas in order to help to reduce, the terrible unemployment from which this country is suffering at present. Of course, the increased tariffs and the results of them also mean a lesser standard of living when people cannot purchase the other goods and services.

As I said earlier, we must bring inflation under control in order to compete against imports, but we must do so also in order to be able to compete on the export market. We are a nation of only 14 million people. We lack economies of scale. We do not have the hundreds of millions of people of the European Economic Community. We do not have the hundreds of millions of people of the American customs union. We do not have the economies of scale of the 50 million to 60 million people in the industrious nation of Japan. We are therefore in a relatively precarious position. We ought to recognise just that. But we have some major advantages. One of them is our relatively lower energy costs due to our abundant supplies of coal and natural gas. Another advantage is our access to raw materials, such as our bauxite and iron ore. Another of our advantages is the skills of our people if those skills are developed in the way in which they should be developed. Yet another advantage is our proximity to Asia, the fastest growing area in the world in terms of the growth of the standard of living. There are wonderful markets there for us if we can get out and compete with exports.

That brings me back to the matter of competing for exports. Despite our disadvantages of distance, lack of economies of scale and lack of population, we still have certain advantages. But these advantages cannot be exploited if we do not keep inflation under control. It is just downright wrong to say that the Labor Party does not recognise these facts. Where we differ from the present Government is in the argument about the means of bringing inflation under control. We do not differ about the objectives or about the ends. We differ about how we can achieve a greater competitiveness, not concerning the objective of achieving just that. There are other ways of achieving the objective of competitiveness without bringing our great country to its knees. The bringing of our great country to its knees will be the result of present policies.

In my opinion the greatest feature of this Budget is that it continues the stagnation policies of the last three and a half years. There has been an enormous increase in receipts- the taxation and other revenue which is extracted from the people for government. Those receipts are up by 15.4 per cent. At a time when inflation is expected to be running at the rate of 10 per cent, the increase in government expenditure is only 9.1 per cent. So we have money coming to the government from the people increasing by 15.4 per cent, and we have money going from the Government to the people increasing by only 9. 1 per cent. That is an actual drop in real terms because of the 10 per cent inflation rate. There is only one way to describe that, that is, to say that it is contractionary. This Government is contracting the economy of this country at a time when it should be expanding it and creating more jobs. The Government is prolonging and deepening the intolerable recession which this country is suffering. That is why the Labor Party has included that point in the amendment which it has moved to Appropriation Bill (No. 1 ).

Why is the Government doing so? The Government is doing so, firstly, because it sees some merit in there being a lower deficit. Let me admit immediately that at present- quite wrongly- there is a fetish in the business community in particular about lower Budget deficits. This is because the people of the business community have been shockingly and wrongly brainwashed on this subject by Liberal and National Country Party politicians. I admit that deficits cannot be limitless. They have to be financed by borrowings from the public unless the money supply is allowed to blow out with disastrous consequences for inflation. So there is a limit to the amount of deficit that one can allow. But the more the government has to borrow- we admit this also in relation to deficits- the more there is a danger that interest rates have to be increased. But interest rates do not necessarily have to be increased. I will come back to that in a moment. What I am saying is that the Labor Party realises that deficits cannot be limitless but the limit is far higher than has been allowed by the present Government.

Let me take the point again that there has been too much of a fetish about deficits. Too many people have been ignorantly and wrongly hoodwinked on the subject. Business people now believe that if a government is not bringing down the deficit then it is not dinkum about inflation. So inflationary expectations grow and the belief becomes self-fulfilling. But it is quite wrong. That ignorance must be educated out of the community, particularly the business community.

To help me make my point, let me illustrate my thesis from recent history. I go back to the Whitlam years of government. Contrary to the mythology, Australia did not have a deficit when inflation soared to its peak levels midway through 1974. International inflation was our main problem then, coupled with some wages decisions in the Australian Conciliation and Arbitration Commission which did more harm than good for workers. The country actually ran a domestic surplus of $21 lm in the financial year 1973-74. So, contrary to belief, it was midway through 1974 when inflation was at its peak. The deficit was not high at that time and there was indeed a surplus of $2 1 lm in that financial year 1973-74. The deficit emerged principally very late in 1974 and early in 1975. Yet, as it emerged, inflation caused by international reasons, started to come down from those peaks of mid 1 974. So let me repeat that there is no correlation between high inflation and large deficits.

Let me go further. Since the advent of the Fraser Government, we have had three financial years when the deficit has been at its peak and far higher than during the Whitlam years. The Fraser Government deficits knocked the Whitlam Government deficits into a cocked hat. Yet, thankfully, during those Fraser years, there has been a reduction in inflation. This has been a continuation of that reduction which was commenced when my colleague Mr Bill Hayden, the honourable member for Oxley and Leader of the Opposition, was Treasurer of this nation. So for goodness’ sake, where on earth is the link between deficits and inflation? Where is this mystical- I might almost say mysterious- link? When we look at that piece of recent history we see that there is no link. It should be recognised that there is no link in spite of this mythology which has been allowed to grow. More needs to be said on this subject because there is such a misconception about the monetary effects of government deficit spending.

I believe, and indeed assert, that a domestic deficit of even $2 billion to $3 billion which implies an overall deficit of around $3 billion to $4 billion- one has to distinguish between the domestic deficit and the total deficit- can be consistent with responsible monetary management. It can lead to orderliness in the growth of our money supply with no dire consequences for interest rates. Let us take a monetary growth rate of, say, 10 per cent for 1979-80. This requires an expansion of M3 of $4.5 billion. On the basis of past evidence, a domestic deficit of $ 1 billion to $1.5 billion financed entirely by an increase in base money- that is, printing money- would be consistent with this target. But a deficit larger than this is feasible unless financial markets are saturated with government debt or government securities, and there is no evidence of this being so at the present time. If there is no saturation- as there is not at present- the extra money supply can be and will be soaked up by an increase in private holdings of government debt in line with the growth in financial asset portfolios. A 10 per cent growth in both portfolios and the money supply would enable an extra $1.6 billion deficit spending to be financed by bond sales. In short, a 10 per cent growth target in this monetary area is something which is quite responsible as a target and is consistent with a $2 billion to $3 billion domestic deficitwhich means a $3 billion to $4 billion total deficit without any adverse consequences. Lower target yields would of course yield correspondingly lower deficit figures. It is of vital importance to us as a nation to educate the community out of the present erroneous thinking on this subject of the deficit.

If investors, in response to Liberal Party and National Country Party statements, perceive a $2 billion to $3 billion domestic deficit as adding to inflation, all hope of a satisfactory economic policy is lost. We are doomed to present Fraser Government stagnation policies which are adding to our unemployment on a seasonally adjusted basis from month to month. We need a more expansionary economic policy. We need it desperately. We need it not only because of the extra jobs and the better conditions, particularly for less well off Australians which such spending creates, but also because of the extra confidence it would engender in the community. Consumer confidence is still woefully low. People are not spending; they are saving. The savings ratios are increasing. This is because the residents of this country are naturally terrified about unemployment. We badly need to reduce this fear in people’s minds. Only when we get a Labor government which is not hung up on the mythology of the deficit will people find that confidence to go out and to spend. People will recognise a party in government which is dinkum about unemployment as well as inflation, and people will go out and help to get the economy moving again.

I want to make it clear that the Opposition realises that its more expansionary economic policies can be pursued only if it obtains the confidence of all sections of the communityincluding the trade union movement- to implement an incomes policy. I would have liked time to illustrate what I mean by an incomes policy but my time is coming to an end. The main point I am trying to make in this speech during the Budget debate is that there is an alternative to the contractionary Budget we have before us now in this Parliament. That alternative is greater expansion, so long as there is an incomes policy going with it so that we do not ricochet back into inflation. That more expansionary monetary and budgetary policy is only part of the package which the Labor Party is preparing in order to get this economy going and to reduce the level of unemployment. Other parts of the package include better manpower policies and industrial development policies.

Mr DEPUTY SPEAKER (Mr Millar:

Order! The honourable member’s time nas expired.

Mr GRAHAM:
North Sydney

-This afternoon we heard one of the most remarkable speeches that has been delivered in this House for quite a long time from the honourable member for Adelaide (Mr Hurford). We heard some comments from him about his own economic policies and beliefs and about what he describes as the future activities of a future Australian Labor Party Government. His statement in relation to the deficit is quite the most remarkable statement that has been made in this place for a long time. He is encouraging Australians to believe that they can spend money that they do not have; that they can create additional credit that they do not have; and that there will be- as he said- some degree of flexibility in keeping inflation under control.

The reality is that when the Labor Party came into power in 1973, its first Budget was accompanied by this kind of expression: Now is the time for us to transfer assets from the private sector to the public sector. Then there was the statement: There is no reason why the civil service should not be pacesetters in almost every manner, so that in terms of salaries and benefits, private enterprise will be encouraged to follow the civil service. The end result of this was enormous inflation and the highest taxation rates that we had ever seen. They were introduced by the present Leader of the Opposition (Mr Hayden), when he was the Treasurer in 1975. As I said, when in government the Australian Labor Party set out to transfer assets from the private sector to the public sector. On a previous occasion Labor even set out to nationalise banking. To the best of my knowledge, in spite of what the honourable member for Adelaide said this afternoon, he is still pledged to what he has described as socialisation of the means of production, industry, distribution and exchange. In those circumstances one ought to beware of the new look references which he stated here because they are inconsistent with the policies and the platform of the party to which he belongs.

The honourable member for Adelaide admitted that there was a high inflation level in 1 974. This Government, with prudent economic policies, has reduced that level from its great peak of 17.6 per cent to about 8 per cent. That is a very significant achievement. Private sector interests rates are lower than when the ALP was in power. The unemployment position has really stabilised and seasonally adjusted civilian employment has been increasing month by month. There has been a dramatic recovery in the rural economy. This has reinforced the growth of confidence throughout the private sector. Farm incomes are estimated to have doubled during the year. Production has risen in most industry groups. Retail sales overall are up and dwelling commencements have increased.

Yet the honourable member for Adelaide was saying that people are saving their money and not spending it. The fact of the matter is that record levels will be with us again at Christmas time in 1 979. 1 feel that in most parts of our great cities this will be apparent to all. Private investment spending has continued to grow strongly. The Government deserves to be complimented for its exchange rate management and its effective anti-inflation policies which have continued to help our producers to export. They are now competing successfully on world markets. The balance of payments has improved because of strong growth in the value of exports and increased capital inflow to Australia from overseas.

If there is one significant yardstick by which one may judge the confidence of overseas investors it is to be seen in those figures. If people are prepared to invest in this country, to hope to build industry and manufacturing capacity, they will provide employment for Australian workers. They hope to get a return on their investment. This is the significant yardstick to which I have referred by which the conduct of the Government and the success of its policies may be properly judged. When the Labor Party was in Government in 1974 and 1975 there was an outflow of investment from Australia and what has been described as the exporting of businesses. Many Australian businessmen went to Manila, Hong Kong, Singapore and Bangkok and proceeded, with lower costs, to put their creative ideas into action in those places and to export production back to Australia. The end result was that jobs having been exported we had increased unemployment in this country.

We on the Government side are accused by the Labor Party of being people who are heartless, people who have an inadequate policy related to those in need. We are constantly being criticised on our social security and welfare policies. Yet within the context of overall economic responsibility the Commonwealth Government has continued to give high priority to income security and social welfare needs. Total spending on social security and welfare will increase by 9.6 per cent to $8,900m in 1979-80. This represents 28 per cent of total Budget outlays. Those figures must be seen in the context of what the shadow Treasurer, the honourable member for Adelaide, was saying. Most pensions and benefits will now be indexed on a six-monthly basis in line with consumer price index movements. There is no doubt that in November of this year- in a few weeks time- and in May and November thereafter in each year there will be increases in age, invalid and widows’ pensions, supporting parents’ benefit, deserted wives’ pensions, sheltered employment allowances, unemployment benefit for all aged 18 or over without dependants- and married people in the rare circumstances where they are younger than 18 years- and sickness benefit for all people aged 1 8 years and over and married people younger than 18 years.

The Government has maintained its commitment to provide income test free pensions of $5 1.45 a week for single people, and $85 a week for a married couple, aged 70 years or over. Increases above these levels are subject to the income test. The total expenditure on age pensions is estimated to rise to $3, 530m, almost 40 per cent of the total welfare budget. In these circumstances it seems to me that the Government must be complimented. Most of us believed that economic circumstances were such that it would not be possible for the Government to go ahead with the development of these social welfare policies.

Looking to the future growth of the economy one must turn to energy policy, mining, exploration for minerals and our hopes for the future production of oil in this country. We are all aware of the fact that when the ALP was in

Government from 1972 to 1975 the whole infrastructure of the oil exploration industry was virtually destroyed. The Labor Government followed policies which drove the technical people away from Australia. It denied investment in oil exploration. It set out to establish a frame of mind in the Australian community that would make people believe that the Government was going to nationalise the whole operation if it possibly could.

The latest survey of industry and commerce shows that $7,500m will be invested in projects around Australia within the next 12 months. They are ready to go now or are in their final feasibility stages. At December last the estimated capital cost of mineral projects already on the board, excluding the Western Australia North West Shelf project, was $4,000m. It is estimated that between 83 and 143 exploration wells could be drilled this year. Even the lower estimate of 83 wells would be the best result since 1972. The Government’s crude oil pricing policy and taxation and investment incentives have given a new impetus to the oil exploration industry. As a result, Australia’s oil reserves have been upgraded by more than 600 million barrelsabout three years’ additional supply at current consumption rates. New capital investment in mining was 75 per cent higher last year. The larger mining companies expect to increase their investment by a further 32 per cent this year.

A package of six uranium Bills, covering uranium development, Aboriginal land rights, nuclear codes, national parks and environmental protection measures, has been passed through the Parliament by this Government. The Commonwealth and the Northern Lands Council have reached agreement on terms and conditions for mining the Ranger uranium deposits in accordance with the Aboriginal Land Rights (Northern Territory) Act. What has been happening in the Labor Party recently in relation to these matters is very significant indeed. We are aware of the fact that the former president of the Australian Labor Party, who is hoping to become a member of this House, tried to convince the Australian Council of Trade Unions that it ought to support the Government in its policies for the production of uranium; but he failed. He failed because there are people who are seeking, for reasons quite divorced from problems of safety, to prevent Australian uranium from being mined. One can only conclude that that is in the interests of people other than those who live in this country.

In my judgment, the people of Australia can be very thankful that over the last three years they have had a government that has been determined to attack the problem of inflation. It is quite clear to me that the honourable member for Adelaide, who preceded me in this debate, is simply going to ignore all the advice which came from the Labor Government in London and all of the advice that came from his own senior people several years ago when the then Prime Minister, the former member for Werriwa, and the former member for Melbourne Ports were making comments such as: ‘Every time there is an increase in pay it is another man ‘s job ‘.

Mr Innes:

– Rubbish! Absolute claptrap!

Mr GRAHAM:

– These statements were made. The honourable member can see them in Hansard. Mr Frank Crean made these statements and they are recorded in Hansard.

Mr Innes:

– You are taking them completely out of context.

Mr GRAHAM:

– The context is the context of reality. The honourable gentleman says that I am quoting out of context. I really do think that he should study what happened in London and read what Mr Healey said when he stated that it was not possible to inflate an economy back into full employment. The British Labor Government went right through the process, as the Labor Government here did between 1972 and 1975, continually spending and creating credit which did not exist. This resulted in very difficult economic problems for Australia and it has been almost impossible for this Government to cope without some form of restriction. This has to be the case. In the 1930s we had depression. Before the war we had circumstances that were unknown in our national history. To my mind, to talk about the current circumstances as being comparable to those of those years is absolutely absurd.

I am going to support the Budget and the Government because I believe that the Budget has in fact sustained the living standards of Australians. In my judgment, it will improve the living standards of Australians as time goes by. I suspect that when the next election takes place the Government will make it clear to those in Opposition that they had better look around their benches and get used to them because after that election they will be on that side of the Parliament again.

Mr INNES:
Melbourne

-I rise to support the amendment moved by the honourable member for Gellibrand (Mr Willis). He has introduced into this debate certain specific areas to which I would like to address myself. In his address he pointed out that this Budget is surely one of deceit and deception, because it has endeavoured to take the people in the electorate for a ride on a whole range of issues that directly affect their livelihood. It is also a deceit of broken promises. Pressures have been applied to government instrumentalities, States and the like to reduce the standards and the expectancy of people throughout the length and breadth of this country. The time allocated to me in speaking to the amendment is not sufficient to enable me to deal with matters in my area of responsibility. I will just address myself to the area of telecommunications and postal services, which highlights the effect of Government strategy and policy. Telecom Australia and the Government have made great mileage out of the ‘Community Access 80’ document, which they claim offers substantial benefits to fringe suburban and rural areas in terms of telecommunications charges. In the near future I intend to take issue with many of the claims made about those so-called benefits.

At present I would like to talk about an area in which this Government has deliberately increased telephone costs for the whole community, and in particular for the fringe suburban and rural areas. Before this Government came into office a large percentage of Telecom capital investment funds was provided by the government through a Budget allocation. This Government progressively reduced that allocation until it was withdrawn altogether in last year’s Budget. The Government has forced Telecom to compete for loan fundings on the open local capital market; it cannot utilise the cheaper interest rates offered on the international market. This means simply that Telecom interest repayments have risen substantially. Therefore, the cost of capital works has risen proportionately. It now costs more to provide capital works than it did when the government provided loan funds at favourable interest rates. A Labor government will look at the possibility of reducing those costs by looking once again at the possibility of providing loan funds at favourable rates. This will mean significantly lower rates for rural and suburban fringe subscribers. The major cost in trunk and subscriber trunk dialling calls is the cost of the capital equipment used to make the call. If that capital equipment cost can be lowered, the cost to the subscriber can be lowered. In this sense the ‘Community Access 80’ document and the supposed benefits it offers are a three-card trick designed to woo the voters in the marginal areas.

Rather than engaging in an exercise in deception in which dubious advantages are offered to a number of subscribers whilst in reality the Budget increases the real costs of the services, Labor will take positive fiscal steps, through the Budget, to offset the higher costs of capital equipment. At the moment it is a cross-subsidy of people who are called on to subsidise higher capital cost equipment. If this is done regardless of the departments involved- one looks at decentralisation, primary industry and the like- it is right and proper for the particular department to look at the subsidy and not to throw it back to the consumer who is paying excessive rates despite the profits of Telecom in the telecommunications area. The loan funds policy confirms the Government ‘s policy of handouts and its snide support of private capital interests.

By forcing Telecom to take public loan funds for 18 per cent of its capital requirements, the Government is redistributing public funds from Telecom’s purse into the hands of those financiers which play the private capital market. A loss of public wealth results with every interest payment to these pinstriped loan sharks. There are plenty of them about. Some of them occupy seats on the other side of the House. Loan funds provided through the Budget mean that the capital will remain in public hands. The Government provides the funds to a statutory body which repays the loan with interest back to the Government. Labor may look at charging the loan against the appropriate department. As I have pointed out, this is one of the areas that ought to be investigated. Community subsidisation of rural areas, as is the case at present, is unimportant; the end result is that the capital remains in public hands. Under this Government’s policy of forcing Telecom on to the local market, the statutory body repays the loans at higher interest rates to the individuals who exploit it.

As the shadow Minister in this area I have developed a comprehensive program for lowering telephone costs across the community, reducing the problems faced by country subscribers and bringing the justice of community need, not the greed of private capital, into the forefront of government policy. In a related area relevant to the portfolio, the Budget has failed to provide for new avenues of income for Australia Post and Telecom which could increase their revenues and provide cheaper, more efficient services to subscribers. Again, many of these areas eat into the autonomy of private multinationals in the market place. Again, I suggest that the Government has a deliberate policy of undermining the public sector for their benefit. Australia Post and Telecom have extensive estate interests which are not being fully utilised. It is a known fact that the telecommunications terrestrial system is 50 per cent utilised. Some capital investment is needed in a very efficient enterprise which is making enormous profits at the moment. Surely it is worthy of that investment. A Labor government would investigate the needs of the commissions and turn real estate into profit through leasing and rentals, if necessary acting as a developer. Too often, private developers make huge profits at the taxpayer’s expense. They will do it in Canberra.

I believe that another service which Australia Post could offer would be to act as agent for several government departments where there are possibilities to develop such services. That statutory body could receive an agent’s fee for these services. The benefits are clearly two-fold: Firstly, Australia Post would increase its income potential; and, secondly, the local post office would provide a much needed and valuable public service by decentralising many government services. I believe that the Government also serves its private capital backers by taking no action against services which clearly abrogate the postal and telecommunications Acts. Many message and letter delivery services challenge the common carrier sections of the Acts. Many private telecommunications services certainly bear investigation. A Labor government would investigate these practices and take legal action against them where necessary.

Rather than acting to pursue the law, this Government is openly condoning and often encouraging these services in direct competition with the Public Service. One of the major areas of potential public income not tapped by this Government is the area of business and special telephone services presently dominated by multinational cartels. Telecom has not been encouraged and /or allowed to enter this lucrative field. Advances in switchboards, such as the new private automatic branch exchange, and new types of telephones which simplify business calls are being marketed by private companies while Telecom workshops are quite capable of developing and marketing these services. What is worse is that often Telecom officers effectively work as public relations agents for private companies. The only new area which Telecom has entered is the push-button telephone which has very dubious advantages. As many honourable members will realise, the really lucrative new markets are untouched. Labor would make Telecom compete vigorously for these markets. We would also prevent practices whereby Telecom workshops in the past have improved and developed products which have then been used by the private developers to increase their profits. This Budget attacks none of these problems.

Telecom also expects to increase its extortionate profits by a further enormous amount this year. Its recently published ‘Service and Business Outlook for 1979/80’ does not estimate in so many words what this increase will be or even let on to the Parliament and the public that there will be an increase. But the booklet mentions an expected 9 per cent increase in earnings and only an 8 per cent increase in costs. A little arithmetic with previous figures leads me to believe that Telecom’s profit may therefore rise by up to $40m to a figure in excess of $220m. We are not opposed to profits per se. We are opposed to lining the pockets of individuals who serve the Government. That money must be ploughed into rendering a proper effective service to all Australians. The program of country telephone automatic connections is not gaining its promised expansion. In some areas Telecom admits that connection times for new telephone services will increase to an admitted time span of several months.

The most drastic reduction in service to the public by Telecom is the continued winding down of the telegram service. Although telegram prices have increased every year since 1974-75, they are to rise again this year. At the same time, Telecom expects 12 per cent less telegram traffic and lower staff needs in the area. There is a deliberate sabotage of the service. The cost of the service to people who do not have a telephone and who need a service of that nature is exorbitant. From next month it will cost $4.30 to messenger deliver a 12-word telegram. An urgent telegram of the same sort will cost $8.60 to deliver- over 70c a word. The cheapest practicable means of delivering a telegram- by telephone- will cost $3, and $6 if it is urgent. That is 50c a word. The easiest but totally nonpracticable method of delivery for Telecom is by post. A 12-word telegram will cost only $2.50. However, the business community is a little better served. The smallest percentage increase in telegram costs, a mere 1 1 per cent, goes to telegrams delivered by telex which are a snip at $2 a pop. The reason for constant rises in telegram costs is Telecom’s futile commitment to the user pays principle, a principle worthy of substantial review and little else. Clearly, there are disadvantaged groups within the community. I am thinking also of country users who deserve crosssubsidisation by their more fortunate neighbours. Some services deserve continuation despite a continuing loss. They should not be priced out of reach for those who desire and need them.

Telecom expects this year to increase its staff by only 0.3 per cent or roughly 250 people in a total work force of 90,000. Australia Post expects a similar increase in a staff of 31,500 after reductions last financial year. It is not right in these times of drastic unemployment and the hardship associated with it that those who can afford to carry more of the burden, such as our profitable public enterprises, do not do so. Hiring rates should be increased. It is not as though there is no work to be done. Telecom admits that it will take longer to provide some services than it did last year. Telecom has said:

In some districts, particularly New South Wales and Queensland, demand will exceed Telecom’s ability to provide service- hence connection times will increase. It may not be possible to allot new telephone numbers from a few exchanges for periods extending to several months.

We all know that when bureaucracy forecasts waiting periods of several months some people at least will wait much longer.

The deceit and deception of the Government’s Budget strategy is inherent in the estimates for each of the departments for which I am responsible as Opposition spokesman in this House. It is a Budget of deceit and deception. The amendment moved by the honourable member for Gellibrand points this out. If Government members had any conscience whatsoever they would support the amendment and oppose the strategy that is contained in this Budget, which is a very vicious Budget that will do nobody in the community any good.

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

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

– This year’s Budget is further testimony to the Commonwealth Government’s support for immigration, for migrants and for the development of a socially cohesive and culturally diverse Australian community.

It is frequently said that Australia is a country of immigrants. At no time in Australia’s history has there been such a wide range of achievements in immigration and ethnic affairs as there has since the beginning of 1976. Let me just reiterate some of the achievements of this period of less than four years in order to put the Budget appropriations for the current financial year into perspective.

Following an extensive review of immigration policies in the context of Australia’s population, new immigration policies and population objectives were announced on 7 June last year. We have an active immigration policy with denned objectives over rolling three-year periods; we have relaxed family reunion entry categories in a responsible way; we have introduced new opportunities for independent applicants to be considered for migration under a systematic selection system known as NUMAS, which is based on the collective experience of settlement in this country over many years. We have introduced a refugee policy and mechanisms which at the time were unique in any country in the world and we have demonstrated over the past two years in particular an ability to operate a complex refugee intake program in a compassionate but responsible way. There has been a major initiative in the area of post-arrival services and programs for migrants as a result of the Government’s acceptance of the Galbally report’s recommendations. The implementation of the Galbally report’s recommendations is proceeding generally on schedule and I shall be making a statment in the near future to give details of the implementation program.

I am confident that there is no country which has developed such an effective and wideranging framework and specific programs and services for migrant settlement to offset disadvantages newcomers hold and to ensure that they have equality of opportunity and treatment in their new home. There has been significant progress in developing standards in interpreting and translating through the National Accreditation Authority for Translators and Interpreters and dramatic advances in recognition of overseas professional and generalist qualifications through the operation of the Committee on Overseas Professional Qualifications. The Telephone Interpreter Service- a unique Australian system of communication and assistance to those without an adequate knowledge of English- was decided on by the McMahon Government in 1972. It is now operating in all States and will be extended through the use of modern technology to cover all significant groups of people around Australia who do not speak English. Funds are provided in the Budget to assist in doing just this.

In the area of adult migrant education, the Galbally report’s recommendations have provided a boost to action through increased expenditure. Two years ago, there was virtually no initial settlement program for newly-arrived migrants. In the current financial year provision is made for almost 12,000 newly-arrived migrants to participate in this program. This is for a substantial proportion of adult migrants who do not speak English and require information about Australia, its institutions and available services. In the on-going Adult Migrant Education Program, current enrolments total around 100,000. We are moving to extend the Home Tutor Scheme and to make it more effective. Discussions will be initiated in the near future with the objective of extending the Courses in Industry Program. This extension is planned first for Melbourne and Sydney, which are the main centres of migrant concentration. Overall, the Adult Migrant Education Program will receive $24,100,000 in the current financial year, an increase of 34 per cent on expenditure in the 1978-79 financial year. To put this in perspective, the appropriation this year will be four times that outlaid in 1974-75. As honourable members would know, I recently introduced a Bill to establish an Institute of Multicultural Affairs in Melbourne. This will also be breaking new ground and represents further evidence of the Government’s commitment to the development of a cohesive multicultural nation.

In all, the appropriation for my Department will be $73.4m, an increase of $1 1.7m on expenditure last year and representing a significant increase in real terms. Over 50 per cent- that is $37. 735m- of this expenditure will be on the provision of settlement services. An additional $lm has been allocated for the development of migrant resource centres to assist community settlement and to provide focal points in the community for migrants to receive information and advice on services and to develop their own co-operative arrangements for self-help.

I doubt whether any impartial observer could dispute that this is a remarkable record of achievement in a short time and especially under difficult economic circumstances. We in the Government believe that a continuing immigration program is a crucial element in policies and programs for the advancement of Australia. We believe also that we must link the immigration intake with effective post-arrival settlement programs so that the process of immigration is one that is satisfying and productive to migrants themselves and to the Australian community.

We believe that people should not be enticed to Australia with inaccurate or out-of-date information about Australia when they make their decision to migrate. For this reason, expenditure on information and publicity will rise from $537,000 to $790,000 in the current financial year and we will review our information activities both overseas and in Australia in the light of the major information needs survey now being concluded under one of the Galbally report’s recommendations. Expenditure on population planning and research will increase by 22 per cent in the current financial year. This is essential expenditure to ensure that adequate information is available to decision-makers in the Australian community for resource allocation, for immigration planning and for use by those who have to plan and carry through services to the community as a whole and to elements within the community.

I am sure that most people still do not appreciate just how much population growth has slowed down in Australia and the implications of this slow-down for the future. In each successive year since 1971, when there were 276,000 live births in Australia, there has been a reduction in the number of live births. By 1978 the number of live births had declined to 225,000. In other words, last year there were 50,000 fewer live births in Australia than there were seven years ago. That trend has enormous implications for areas including education, service industries and domestic consumption in the years ahead.

More than 20 years ago when Australia was going through a difficult period of unemployment and economic problems, there was a clamour from some people that immigration should be cut or that it should stop completely. Fortunately, good sense prevailed and a majority of Australians, not only supporters of the Government of the day but also leaders of the trade union movement, recognised the importance of immigration to Australia’s development and economic well-being. Planned immigration, based on the need to maintain a balanced program, both ethnically and industrially, continued to lead us into the prosperous 1960s. Attitudes, especially of some sections within the Opposition in more recent times, are reminiscent of those calls for reduced immigration in 1956 and 1957. Those people should heed the warning given at that time by the then President of the Australian Council of Trade Unions, Albert Monk, who said:

It may be possible to turn off the flow of migrants, but it is hard to turn it on again.

He and the government of the day recognised how much migration had been associated with buoyant national prosperity and how it was impossible to turn the flow of migrants on and off without, firstly, a loss of confidence in Australia as a country of resettlement and, secondly, a consequent loss of impetus in planned population growth as an important component in economic development and national prosperity.

I mention this statement by Albert Monk as a contrast to the present views of the Opposition. Our immigration and ethnic affairs policies have been stated in this Parliament. But what about the attitudes and policies of the Opposition? I have studied the platform that the Australian Labor Party adopted in Adelaide in July this year without obtaining any real clues to the approach that the Opposition would take if it ever assumed government. Perhaps the reason for the lack of specific policies is that the Opposition does not really believe that it will get into government for a long time. The ALP’s immigration policy is a very imprecise one but it does say that family reunion must have a high priority.

We might ask what is meant by family reunion. In a statement on a new approach to immigration and community relations, the Opposition spokesman said that family reunion is a concept that includes:

Brothers, sisters, fiancees and spouses without necessarily putting an order of priority as to which one should go before the other.

It is an incredible situation in which the ALP spokesman has omitted from his list parents and children of Australian residents and referred only to female fiancees. It is even more incredible that the Opposition says that one should not put an order of priority as between brothers, sisters, fiancees and spouses for migration purposes. Australia would be a laughing stock if it were to adopt an approach which gave no priority to spouses and to fiancees and parents over brothers and sisters. But the ALP approach begs the whole question of selection criteria. If the ALP asserts that all brothers and sisters of Australian residents should be admitted to Australia government would quickly lose control of the intake. Within one year an additional 25,000 to 30,000 or more brothers and sisters would be eligible and the number would increase in a geometric progression very rapidly. It is by no means impossible that within three or four years of the introduction of an open-ended policy for brothers and sisters as many as 100,000 brothers and sisters would be coming to Australia as migrants.

There is no clarification in recent Press releases from the Opposition spokesman on Immigration. He has recently released two Press statements one of which can be dismissed immediately because it was not only nonsensical but also based on a false premise that the effects of NUMAS can be deduced in figures for the migrant intake for the financial year ending on 30 June. In fact, very few migrants chosen under NUMAS had arrived before the beginning of this financial year.

But the Government has been accused more recently of promoting migration ‘at a time when unemployment amongst newly-arrived migrants has reached 17.5 per cent’. This again is misleading. There is a need for extreme caution in interpreting the results of labour force surveys where the numbers involved are very small. Overall, the labour force survey showed an unemployment rate among overseas-born of 6.2 per cent in July, only marginally above the figure for Australian-born and this in spite of substantial intakes of refugees and the Tasman free-flow movement. Moreover, there has been a definite trend for many years for overseas-born recent arrivals to have a much higher rate of unemployment as shown by the labour force survey, than other groups in the community, and this is for obvious reasons. Not the least important is that the labour force survey gives a snapshot picture. It does not reflect the very high level of mobility among recently arrived migrants who might have had four or five jobs in a relatively short period but be unemployed at the survey date.

Recently arrived migrants move from hostels into the community or from initial accommodation to more permanent accommodation. They may seek employment initially near their first place of accommodation and then seek employment closer to their more permanent accommodation. If anything, the unemployment rate for overseas-born has been declining during the current calendar year and this applies to the rate for arrivals since 1 January 1978 where the rate has declined from over 20 per cent in January of that year to 1 6.5 per cent in July.

This sort of nit-picking approach by the Opposition spokesman obscures the fact that we are accepting large numbers of persons on humanitarian grounds such as Indo-Chinese refugees, Soviet Jews, Timorese, Eastern European refugees, and large numbers of persons on compassionate family reunion grounds. It is of interest that if one takes only the occupationally eligible entrants in the 1978-79 financial year, only 17.7 per cent of persons intending employment were not in skilled, technical, professional or administrative worker categories. If we take a different approach and look at the family reunion and refugee categories- the groups the Opposition would give priority to- 73 per cent of those indicating they would be seeking employment were in the unskilled, semi-skilled or not classified categories, the very groups in greater difficulty in finding employment under current circumstances.

It is a pity that in a debate on immigration the Opposition should have descended to the sort of level where the Opposition hovers around waiting for innocuous pieces of paper, in some instances early Departmental drafts, to become available as the basis for unintelligible Press releases. Let me look more closely at the intake arid what it really means. In the intake of 68,750 settlers for the financial year 1978-79, the numbers of persons intending to enter the work force was just over 27,500. The remaining 41,200 persons were dependants and persons not intending to enter the work force. If we deducted the number of persons in the work force in Australia departing for permanent residence overseas, the net worker gain to Australia in the financial year 1978-79 would be less than 25 per cent of the gross migrant intake.

This gives an indication of the need to maintain a significant level of migration in order to maintain the skilled work force in Australia since a considerable proportion of the persons leaving Australia are persons with skills and experience who have found jobs overseas. It is important to realise also that migrants are highly mobile in the period soon after their arrival in Australia, so that they are able to take up vacancies in the Australian work force. Filling of these vacancies helps create jobs in related industries and occupations. So the simplistic approach that so many on the Opposition side take, that is, because we have a migrant intake we will add to unemployment, is clearly shown to be absolute nonsense. If we structure the migrant intake correctly, rather than adding to unemployment we can in fact create more employment opportunities particularly in that area where great need exists- the area of semi-skilled and unskilled workers.

Mr Deputy Speaker, I have a feeling of pride in referring to the achievements in the Immigration and Ethnic Affairs portfolio since the beginning of 1976. This year’s Budget gives additional funds and resources to enable a continuation of a positive approach to Immigration and Ethnic Affairs. Australia has enormous resources. It has enormous space. It has enormous energy to be tapped. It has a skilled work force. It has a very small population and domestic market. In short, it lacks the people to achieve the undoubted potential we have for building a prosperous, free and great nation. We face great challenges as a country of large-scale refugee resettlement but I believe that this complex issue has been handled in a way that balances compassion and the interests of the Australian community.

Our immigration and ethnic affairs policies and programs are based on Australia’s interests, compassion for our fellow men and women and playing a responsible role in the international arena. They provide a firm basis for development of this nation and for achieving individuals ‘ prosperity and security in a free society.

Mr Barry Jones:
LALOR, VICTORIA · ALP

-Mr Deputy Speaker, I second- I am sorry, I do not actually second but I speak in support -

Mr MacKellar:

– Second it.

Mr Barry Jones:
LALOR, VICTORIA · ALP

-I would second, third, fourth or fifth it if I had the opportunity. I support the amendment in regard to Appropriation Bill (No. 1) moved by the honourable member for Gellibrand (Mr Willis) condemning the policies of the Fraser Government since its election in 1975. I want to talk, as I have quite often in this House, about the problems of increasing unemployment in this country. I believe one of the great problems we as a parliament face is that we lack the opportunity really to examine the long-term implications of what we will do. Quite often we find in political life that the shortterm consideration is paramount and the longterm consideration is ignored. This is true whether we deal with political parties, the parliamentary process, trade unions or business. Very often it is the short-term consideration rather than the long-term consideration which tends to dominate. Occasionally we hear from the Government some kind of projection as to what it thinks future employment will be in this country.

I wish to draw attention for a few minutes this afternoon and again tonight to a working paper on a project that has been put out by the IMPACT research centre through the Industries Assistance Commission. It is called: ‘The SNAPSHOT Model: underlying theory and an application to the study of the implications of technical change in Australia to 1 990 ‘. It is written by P. B. Dixon of La Trobe University and D. P. Vincent of IAC. The IMPACT project is a Commonwealth Government inter-agency project in co-operation with the University of Melbourne to facilitate the analysis of the impact of economic, demographic and social changes on the structure of the Australian economy. The IMPACT research centre is located at the Industries Assistance Commission in Melbourne. A draft preliminary working paper, the title of which I mentioned previously, was published in August 1979. The SNAPSHOT model is an attempt ‘to simply ask what the economy will look like at a particular point of time in the future ‘. The chosen date is 1990-91 and comparison is made with the base year of 1 970-7 1 . The authors set out to compare two models of the Australian economy between 1971-72 and 1990-91. One model adopts technical progress, which is not defined, for 19 years, and the other foregoes technical progress. As the authors say on page 24:

The comparison between our two simulations provides a basis for discussing some of the implications of technical progress. Put in frankly emotive terms, the comparison is between the long-term prospects for what we will call an innovative economy and those for what we will call a Luddite economy.

The paper has been praised by Professor Alan A. Powell of Melbourne University in another IMPACT paper entitled ‘Employment Prospects for Keynes’ Grandchildren: Some Popular Fallacies’. The most enthusiastic endorsement has been from Mr P. P. McGuinness, the Economic Editor of the Australian Financial Review, writing in both the Financial Review and the National Times. In fact, Mr McGuinness ‘s enthusiasm is of such an order that he claims rather more for the SNAPSHOT paper than the authors would claim themselves. A Financial Review editorial headed ‘Not 1984, but 1990’, which was published on 12 September, roundly declares that:

In an economy with rapid technological change major industries, far from declining, expand substantially. That means that Ludditism would destroy more jobs than technological advance.

I think it is necessary to say that this does not appear in the SNAPSHOT paper or in Professor Powell’s paper; at least if it does, I cannot find it. I asked Mr McGuinness by telegram if he could confirm where the material came from. I checked Table 4.3 which he named in his reply, only to find that the material was not there. The paper raises some anxieties. For example, the authors use the terms ‘technical change’ and ‘technology’ as if they were identical. ‘Technical’ is a far more narrow and specific term than is ‘technological ‘. For example, conversions from direct current to alternating current, from imperial measurement to metric or from diesel to liquefied petroleum gas could probably be regarded as technical; technological is far broader, involving the sum of knowledge of the means and methods of producing goods and services; for example, conversion from fossil fuels to atomic power. The extreme sophistication of the SNAPSHOT paper’s economic methodology, which makes whole pages completely incomprehensible to the non-mathematician- a factor which makes its adoption more likely at policy making levels- conceals the apparent naivete of its conclusions.

The author’s computer may have been told things that are withheld from the reader, but I am unable to find even a single sentence in a 58-page paper to explain what elements of technical progress are considered; that is, precisely what type of technical or technological scenario is anticipated. The comparison between an innovative economy’ and a ‘Luddite economy’ suggests the language of advocacy rather than an objective description. In any case, where do we find the Luddite economy which is described as foregoing technical progress for 1 9 years, whatever that means? We are already eight years in from 1970-71. Does this mean that the Luddite economy retains the 1970-71 technology- that is, pre-microchip technology- but fails to recognise changes that have already been introduced to 1979-80? If so, the description is misleading. But there is growing evidence that the paper is of significant influence in shaping some elements of government policy. It might be more relevant to compare the impact of technology or technical change if, firstly, the rate of change from 1971-72 to 1979-80 continues unchanged until 1990-91; or, secondly, if the projected rates of change are accelerated between 1979-80 and 1990-91.

After the use of ‘frankly emotive terms’ on page 24 of the IMPACT document, it comes as a profound anti-climax to read on page 52 that:

The overwhelming impression from Table 4.6 is that the occupational composition of the work force … in 1990-91 is unlikely to be radically different from that in 1 97 1-72 and that it will be determined largely independently of technical change.

Sitting suspended from 6 to 8 p.m.

Mr Barry Jones:
LALOR, VICTORIA · ALP

-Prior to the suspension of the sitting I was telling a spellbound House about the IMPACT project sponsored by the. Australian Government, in collaboration with Melbourne University, under the auspices of the Industries Assistance Commission, and in particular about its recently published paper called The SNAPSHOT Model’-it is not a novel-by P. B. Dixon and D. P. Vincent. SNAPSHOT uses computerised projections in an attempt to describe what Australia’s economy will be like in the year 1990-91. The authors examine two different scenarios: One rejects all technological change, which they call the ‘Luddite economy’, and the other adopts all technological change, which they call the ‘innovative economy’. The authors make no apology for using what they call frankly emotive terms’ to describe these two scenarios. The reason that I put so much stress on the SNAPSHOT report is that it is the only document in existence prepared under government funding which even attempts to estimate the extent of future technological unemployment.

As I shall show, the figures in the survey are quite alarming. Nevertheless, enthusiasts for technological determinism among our leading financial journalists read the SNAPSHOT paper as a ringing endorsement of vast employment expansion under high technology. This is simply not the case. I can, however, make one very confident prediction, and that is that not one word of my speech will be reported in the Australian Financial Review, the National Times, the Bulletin, the Age, the Canberra Times or the Australian. I want to describe precisely what it is that the SNAPSHOT paper describes. As I said before the suspension of the sitting, there was a concession by the authors that the overwhelming impression from table 4.6, which later I will ask to be incorporated in Hansard, is that the occupational composition of the work force in 1990-91 is unlikely to be radically different from that in 1971-72 and that it will be determined largely independently of technical change.

This, of course, raises the question: If all the technical change will produce no change in employment then why did they use the ‘frankly emotive terms’ with which they describe the two scenarios? In fact, there is a yawning gap in the SNAPSHOT paper which is not examined, let alone filled in. Table 4.1 on page 28 of the paper is based on an assumption from page 27 that a growth in annual productivity from 1971-72 to 1990-91 of 2 per cent per annum would lead to a decline in final demand for labour of 32 per cent. This implies an annual growth rate of 1.69 per cent- that is to say, 32 over. 19. Why a figure of 19 multiplied by 2 per cent- that is to say, 38 per cent- is not used, is not explained. The table suggests that there will be a fall in labour requirements by 1990-91 of 32 per cent- that is to say, the 100 per cent minus 32 per cent which equals 68 per cent. I seek leave of the House to incorporate in Hansard table 4.1 headed ‘Labour Requirements by Occupation to Deliver a Fixed Vector of Final Demands Assuming 1971-72 and 1990-91 Techniques.’

Leave granted.

The table read as follows-

Mr Barry Jones:
LALOR, VICTORIA · ALP

-I thank the House. Table 4.2 says that the work force in 1990-91 under the ‘innovative economy’ or the ‘Luddite economy’ will be identical- 7.9 million. This is based on assuming that 49 per cent of the total estimated population in 1990-91 will be of work force age and offering for work. But, Mr Deputy Speaker, the term work force does not mean the actual number of people in work. It means the number of people who are of work force age and who are offering for work, full time or part time. I seek the leave of the House to incorporate in Hansard Table 4.2 headed ‘Projections of GDP and Other Macro Variables’.

Leave granted.

Mr Barry Jones:
LALOR, VICTORIA · ALP

-I thank the House. In the entire SNAPSHOT paper there is not a single sentence which discusses employment rates, the impact of technological unemployment or attempts to identify where new jobs will be found. In fact, Table 4.6 takes a baffling line. It predicts that the occupational shares- that is to say, proportions- in the work force will barely change while forgetting that in Table 4.1 a massive fall in absolute numbers has been predicted. For the last time I seek leave of the House to incorporate in Hansard Table 4.6 headed ‘Occupational Shares in the Work Force’.

Leave granted.

The table read as follows-

Mr Barry Jones:
LALOR, VICTORIA · ALP

-I thank the House. This discrepancy seems to have escaped the notice of the authors and of some of the financial journalists who have been examining the paper. The point is that Table 4. 1 indicates that labour requirements, using 1971-72 techniques, would by 1990-91 amount to only 68 per cent- a total of 3,58I,000-of the then work force. That would, of course, represent a shortfall of the order of 4.3 million. Somehow it is airily assumed that new jobs will be created although Table 4.6 makes it quite clear that it is anticipated that the variations between the proportions of people in the work force will be of a very small order. The statement on page 52 of the paper, that the occupational composition of the work force is unlikely to be radically different in 1990-91, is correct if it refers to relativities- that is to say, percentages. But if we refer to absolute numbers there appears to be a shortfall of 4,319,000 jobs-that is to say, 7,900,000 less 3,581,000-to be accounted for. No doubt new jobs will be found, but SNAPSHOT does not suggest where they will be. True, the value of consumption is predicted to fall from $52.6 billion in the innovative economy to $35.8 billion in the Luddite economy, a drop of 32 per cent identical to the predicted fall in labour needs from 1971-72 to 1990-91. But are high consumption and quality of life necessarily identical, although no doubt they are related? SNAPSHOT predicts that, compared to the ‘Luddite economy’ the ‘innovative economy’ would produce industry growth rates which were -

Mr DEPUTY SPEAKER (Mr Millar:

Order! The honourable member’s time has expired.

Mr Barry Jones:
LALOR, VICTORIA · ALP

– That is a pity. I only needed another minute. Could I have that?

Mr DEPUTY SPEAKER:

-I am afraid that the honourable member must resume his seat.

Mr Barry Jones:
LALOR, VICTORIA · ALP

– If I could have another minute I could make a very valuable point.

Mr DEPUTY SPEAKER:

-The honourable member for Lalor has had two occasions to address the Budget and the amendment. I am afraid, short of a motion to extend -

Mr Barry Jones:
LALOR, VICTORIA · ALP

– If the Minister were gracious enough to allow me, it would take only a very short time.

Mr DEPUTY SPEAKER:

-I think not.

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

– In spite of the extraordinary lengths to which the Opposition has gone to confuse the people regarding the responsibility and advantages of the Budget to the taxpayer as from 1 December, this year’s Budget has been well received by the community generally and in particular by the business sector. This is reflected in the way in which the stock exchanges have reacted to the Budget. At the close of trading yesterday the index of all ordinary shares was 667.8 1 points, which is higher than the mining boom of 1970 when the index reached 663.48. Indeed, last week it topped a record of 677. During the days of the Whitlam Government the index sank to as low as 220 points.

Mr Donald Cameron:
FADDEN, QUEENSLAND · LP

– How low?

Mr HUNT:

– As low as 220 points. Compare that with the index at the close of trading yesterday when it was 667.81. In spite of all the criticism by the Leader of the Opposition (Mr Hayden) and his small band of supporters, the fact remains that the record of the Fraser Government in economic management is far ahead of the deplorable record of the former Labor Government. One must not forget that the Leader of the Opposition was one of the most important members of the Whitlam Ministry. Indeed, he was central to its economic policy decisions. He was one of the great spenders. He was the Minister for Social Security. Indeed, he was the master of Medibank. He was the Treasurer during a most significant period of the Labor Government. He was the Treasurer when the Labor Government crashed in the greatest political landslide in our history. He presided over social security during the important period of Labor’s three-year term when social welfare benefits and costs rose from $2,099.7m to $5,077.4m and when the Commonwealth taxpayers’ expenditure on health rose from $783.2m to $2,952.7m. Mr Deputy Speaker, I seek leave to incorporate in Hansard a table which sets out the movements in some government costs and revenue between 1972-73 and 1978-79.

Leave granted.

The table read as follows-

Mr HUNT:

– It was during the Leader of the Opposition’s term in government that doctors fees for benefit purposes rose by 94.4 per cent. It was during the Leader of the Opposition’s term in government that the individual tax take of government more than doubled- from $4,089.5m to $9219m-in a three-year period, which was a record. Indeed, it was a government of records. It was during that three-year term that the Leader of the Opposition was in government that inflation rose from about 4 per cent to about 18 per cent. It was during his term in government that unemployment rose by 138,000 in one 12-month period alone- between May 1974 and May 1975. Yet we constantly hear of what a Hayden Labor government would do now for Australians.

The Leader of the Opposition has gone to extravagant lengths to shake off the so-called Whitlam extravaganza image. In a wellorchestrated federal conference in Adelaide the Leader of the Opposition did his best to deceive the Australian people into believing that the Labor Party had learnt its lesson now that Gough Whitlam had been deposed, that the new leader, the present Leader of” the Opposition, is now a chastened man and has learnt his lesson. It was implied that it was all Whitlam ‘s fault and that the present Leader of the Opposition would not be as naughty or as irresponsible as his former leader. The old adage that a leopard does not change his spots is very applicable to the Leader of the Opposition and the Labor Party of 1979. Those honourable members opposite who believe that they can hoodwink the Australian people are only engaging in self-delusion. The erstwhile Labor leader in South Australia paid the price for his misjudgment of the electorate. He gambled that the Federal Budget could be sold as a bad Budget, especially in the States. Indeed, so has the New South Wales Premier, who surreptitiously stuffs money up hollow logs while he cries poor and reneges on his promises to abolish estate and gift duty.

Mr Baillieu:

– He has plenty of logs there to put it in.

Mr HUNT:

– That is a very good interjection. I ask you: How can one judge a man who one moment says he has insufficient funds for welfare housing and the next has to struggle to hide a Budget surplus of $100m? How can I trust my New South Wales counterpart, the New South Wales Minister for Health, when he says that he wants an additional $lm for community health projects in that State? The same person tried to blame the Commonwealth for cuts in hospital services. He said that they were made because of a cut in Commonwealth funds. The truth, of course, is that the New South Wales Government will receive $438m under the hospital costsharing agreement for 1979-80 compared with $383.8m for last year, which represents an increase of $54m or 14.13 per cent, which is a greater percentage increase than is enjoyed by any other State government. So I submit that it is hardly a cut.

Leaving aside the attempted deceptions of the New South Wales Government, let us ponder on the recent Labor defeat in South Australia. Honourable members opposite will try to dismiss this inglorious defeat on the grounds that the election was fought on State issues. Unfortunately, as is more often the case, that opinion is at odds with the views of Mr Hawke. Mr Hawke has said clearly that federal issues were involved. The South Australian economy was going backwards before the election last Saturday week. The people recognised that billions of dollars of investment projects were not eventuating because of the negative socialist ideology of the Labor Party. The voters saw that the Federal

Government’s economic strategy had commenced a resurgence of the best business and investment activity for almost 10 years. South Australia was going to miss out because of the negative attitudes of the Labor Government’s policies. It was more concerned with stifling investment and crying poor than getting on with the job. The Labor Party has cost South Australians many billions of dollars.

The people of South Australia have clearly shown that they want development, such as the Roxby Downs development. The Liberal Government will see that this occurs. The project would involve a capital investment of more than $2,000m and employ 5,000 people. It would also indirectly create 50,000 jobs. The Labor Party in South Australia would have denied the people this enormous economic development and the benefit that that would bring to the living standards of South Australians. The Labor Government and its federal counterparts had a similar capacity to cause a drought of investment funds when in office. During Labor’s term in office little or no oil exploration took place in this country. Today Australia is only 70 per cent self-sufficient in motor spirit. Indeed, Australia has had to import up to 60 per cent of some of the specialised fuels, such as avgas. This situation would not have occurred if the development of oilfields and refineries had not been retarded during those three tragic years of Labor government. Already the fuel policy of the Fraser Government has resulted in an improvement of an additional 600 million to 700 million barrels.

The Leader of the Opposition, and those who follow him, have hurled destructive criticism at the Government during this debate. Not once has the Opposition offered one constructive suggestion which could provide any alternative economic strategy. It is very easy to condemn the Government for its strategy and it is very easy to be critical, but it is not easy to deliver the goods, and this Government has in fact been delivering the goods on the economic front. When it comes to policy areas, such as health insurance policy, the Opposition is in total confusion. The Leader of the Opposition, in his address to the annual conference on the New South Wales branch of the Australian Labor Party on 3 June 1978, said:

Let me say this plainly. Labor will restore Medibank. It remains one of our highest priorities consistent with responsible handling of the economy.

The Leader of the Opposition also said:

The restoration of Medibank is a universal protection for all Australians and will be achieved as quickly as we can manage it

Speaking at a public meeting in Geraldton in Western Australia in June of this year, the Leader of the Opposition again pledged that Labor would bring back Medibank as quickly as it could. On 19 July of this year the Australian Labor Party considered this matter at its national conference in Adelaide. The Leader of the Opposition said:

We are committed to a staged restoration of Medibank. The first step will be taken in our first year of office.

At that time the shadow Minister for Health- the honourable member for Prospect (Dr Klugman)- presented a policy for a universal health scheme financed by an income-related contribution. The emphasis is on the words income-related contributions’. The honourable member was not open enough to say that a Labor government would increase taxes. Instead he used the euphemism ‘income-related contribution’. The honourable member did not use the words ‘tax’ or ‘levy’. So what he said, really, was that a Labor government would introduce a universal health scheme financed by a tax or levy. Obviously since the Adelaide conference someone in the Australian Labor Party has attempted to work out the costs because a week or two ago, in his speech in this debate, the honourable member for Prospect said:

The figures that I have estimated for a return to Medibank- I am not saying that that is what one should be aiming at-

This is a curious comment and well worth contemplating. I do not disagree with the honourable member for Prospect. In fact I think he is generally known in this House for his very high degree of frankness and honesty. It is obvious that he is not completely satisfied that a return to a universal health insurance scheme such as the previous Medibank scheme would be good for Australia. In fact he probably has a sneaking suspicion that if a Labor government were to restore that type of health insurance scheme the medical profession would have a capacity to withdraw subsidy from it quicker than a government would have a capacity to pour money into the system. That is largely due to the type of system that we have in this country and which I think we will have for many years to come; that is, the fee for service system. It is debatable whether we should have that form of system. Nonetheless, it is the system that exists in this country. I think there is a high degree of doubt on the part of the honourable member for Prospect about the wisdom or the desirability of a reintroduction of that form of expensive health insurance. The great cost explosion that has been associated with health insurance generally needs to be taken into account. Any fee for service system that does not have brakes and checks in it will ultimately break down under its own burden of cost.

In spite of the decision at the Adelaide conference that if elected a future Labor government would return to Medibank, albeit in stages, it should be emphasised that a return to Medibank in 1979-80 would directly cost taxpayers at least $ 1,000m in medical benefit payments alone. By comparison, the estimated cost of medical benefit payments in a full year under the present scheme would be well in excess of $500m. A return to Medibank not only would encourage doctors to provide more medical services but also people would undoubtedly use them at a very high level. I emphasise that the number of medical services provided in 1974-75 grew by 13 per cent. In 1975 they increased by 28.5 per cent. Those figures may be arguable. It may be that there are lags associated with those figures so far as statisticians are concerned. But nobody can hide the fact that during the Labor term of office there was a very rapid rise in the rate of use of medical services because people were often inclined to believe that they were free. Therefore they had no reason to worry about the costs. I think that in some instances people were encouraged to believe that this was true. By comparison the average growth in medical services since 1976 has been less than 5 per cent. If medical service growth under Labor had continued the cost of reintroducing Medibank would be substantially higher than the $ 1,000m figure that I mentioned a moment ago.

The Labor record in health, for which the Leader of the Opposition had an important responsibility, is more than typical of its record of wanton irresponsibility. I refer for instance to the open-ended hospital cost sharing agreements with the States; the absence of medical services committees of inquiry in each State; the unbelievable 94.4 per cent increase in doctors fees for benefit purposes; the frauds; the rip-offs and the great health cost explosion. During Labor’s term of office total health costs exploded from $2,505m to $5,660m. If people complain about the high cost of health insurance premiums they need to remember that they are paying a high price for the Labor years of extravagance. Health costs accelerated at the following annual rates: During the first year of the term of office of the Labor Government health costs rose by 20 per cent; in the second year they rose by 36.6 per cent and in the third year they rose by 37.7 per cent. Whereas, in our first three years of office the annual rates of increase have been reduced progressively as follows: In the first year of the Liberal-National Country Party Government’s term of office the increase was 14.13 per cent; in the second year, 10.7 per cent and in the third year less than 10 per cent.

I hope that I have contributed to putting into some perspective the incredible attack on the Budget by the Opposition. No attack on the Government’s economic record can deny that the Government has been successful in reducing inflation in spite of external inflationary pressures, due firstly to world wide petroleum price increases; secondly, agricultural product increases, including meat price rises; thirdly, raw material price increases. Australia is doing better than most countries in the western world. Our inflation rate of 9 per cent is lower than the average rate of 12.9 per cent in the Organisation for Economic Co-operation and Development countries. The most recent Budget will continue to exert a downward pressure on inflation.

The restoration of twice yearly indexation of pensions undoubtedly will be of great benefit to the aged people of the Australian community. Of course we all welcome the increased accessibility of over 200,000 pensioners and their dependants to health benefit cards. This will be of great assistance to them in obtaining medical care at no cost to them in most circumstances, and also in obtaining pharmaceutical benefits. I would like to add that the Government is looking seriously at a number of options to try to assist disadvantaged people to obtain pharmaceutical benefits at no cost to them. I hope that we can overcome the present problem in the not too distant future. The Government will continue to help to restore confidence in the investment sector of the economy. I believe that this is a good and responsible Budget. It will continue to help to mend the damage that was done to the Australian economy by the former Labor Government.

Mr DEPUTY SPEAKER (Mr Millar:

Order! The Minister’s time has expired.

Mr SCHOLES:
Corio

-I rise to support the amendment. I think it is interesting that the Minister for Health (Mr Hunt) attacked the Australian Labor Party for not presenting alternative policies but was unable to find things in his own Government’s policies to talk about during his speech. He spent the major part of his speech attacking the Labor Party. I suppose that is reasonable. If I had his record in the health field I would not want to talk about health either, especially my own record. It surprises me that a Minister of the Crown in charge of health would stand up in the House and say that the medical profession in Australia cannot be trusted; that the medical profession would rort a scheme which guaranteed Australian’s health care when needed. I think Australians would also have been surprised to hear the Minister say that those persons who are disadvantaged are now in such a situation, because of his Government’s three years in office, that he feels it is necessary to seek assistance for them in obtaining drugs that they need for their health.

This Budget is one of a continuing series of budgets which has transferred, on a planned basis, resources from those people least able to afford it to other sectors of the community better able to afford it. It is a symptom of the Government’s whole approach that it is agonising over whether a person who feels his ego requires a car worth more than $18,000 should have his purchase subsidised by the taxpayers of Australia. Currently, almost all of the luxury vehicles sold in Australia are sold on the basis of the Government subsidy in the forms of tax concessions and special leasing arrangements. In many cases profits have been made by this mode of operation. There is no such treatment for the persons on $200 a week or less who constitute something like 70 per cent of the Australian community.

The Minister for Health talks about his achievements in health. I will tell him of some of these achievements. Pensioners are no longer guaranteed free treatment. In many instances pensioners have to pay doctors the amount in excess of the 85 per cent which is paid by the Government. People no longer have access to the drugs prescribed for them by doctors. The Government has said that only the cheapest version of any given drug will be available on the free list. The Government has withdrawn its support for the public hospital sector to the extent it is legally able and is engaged- in line with its policy of foreign investment- in encouraging the disposal of Australia’s hospitals to overseas investors.

It is not surprising that the cost of health care rose during the period 1972-75 when the Labor Government was in office. That government accepted its obligations to all Australians, something that this Government would not understand. The Labor Government moved to cover the two million persons in Australia- I repeat two million persons in Australia- who, because of the cost of private insurance and because of their inability to meet those costs, were not covered at all and depended upon their good health or, when sick, upon charity for the cost of their health care should that care become available.

At the time when the Labor Party came into office masses of bad debts were incurred by our public hospitals. There were millions of dollars outstanding in unpaid health care; health care that people had to have but could not afford. It is a situation which the Minister is proud to announce we are returning to, one where health care is available to those who are sufficiently wealthy to be able to afford it; health care insurance based on the risk that one will remain healthy. There is no suggestion now by this Government, as there was prior to 1972, that universal health care by private insurance should exist. That point has gone by the board too.

We do not even have a pretence that there should be some contribution from all Australians- in accordance with their ability to pay- towards the provision of health care services. No, this Government is saying that those who are young can take the risk and have a lower level of insurance. If they run into problems the hospitals will find some means of collecting their money, possibly by having debt collectors parked outside doors. There is no suggestion that a minimum level of insurance is not only desirable but also should be required as part of the normal attitude of a society which I would hope would be charitable enough to believe that people who are in ill-health, who are sick, are entitled to expect treatment. No longer is that a possibility, and one wonders at this Minister’s criticism at the time of the introduction of Medibank and the suggestion then that doctors would create a situation of impossible costs if Medibank were introduced.

How many members in the House now who were members in 1973-74 remember the present Minister, then the shadow spokesman for health, and other members of the present Government, sitting at the back with representatives of the Australian Medical Association, plotting to ensure that Medibank was not introduced, and arranging the voting in the Senate against the introduction of a levy to offset the Medibank payments. In adding up the figures for health care it is convenient to forget that the figures transferred from taxation have been transferred to compulsory contributions or contributions to health care organisations in order that adequate cover may be available to those people concerned about their health. Health is one of those areas where one is entitled to expect care; where that care should be available in accordance with one’s needs and the need for treatment, irrespective of one’s income or capacity to meet the financial costs. Unfortunately, that is not the Government’s policy and it is not the policy which is being pursued currently within Australia. The amendment which the Opposition has moved to this Budget highlights what has occurred in the last three years.

One remembers well the eulogies in this House by Government members about the Government transfer of the former provision of tax rebates in respect of children to increased family allowances. The Opposition was told by the Government, not altogether honestly, that the family allowance was actually a new reform and that new money was being pumped into the family through this system. Certainly some families benefited and some lost. In the year of its introduction the equation was about right. The families which lost were those on higher incomes. The families which gained were those on lower incomes and therefore it was not an unreasonable transfer of resources. But since then the tax concession in respect of children has gone. The family allowance scheme is now very much like the scheme which was introduced in 1950 when another conservative government came to power on a promise to pay child endowment for the first child- an appeal to greed rather than need. Nevertheless, that promise was honoured and in 1950 a five shilling child allowance fee was paid in respect of the first child to each family entitled to receive it. In 1972 families were still getting five shillings. An amount of ten shillings was still being paid to families in respect of the second child. It was an amount which had been fixed in 1947.

The family allowance scheme is shaping up in exactly the same way. The changes in arrangments that took place in 1976 were said to be the greatest advance in care and understanding of the family by any government in modern times. I do not know about the care and the understanding, but I do know that in the last three years that amount has not been altered at all. The Government has completely forgotten about its undertakings. It refused to index the family allowance payments and therefore it is allowing those amounts to depreciate through inflation to amounts which are insignificant. People who would have gained under the tax rebate system are gaining nothing extra now because of the change to the family allowance scheme. People on low incomes have need of that amount of money and need government support, which was offered to them with such wide open arms and such acclamation; in fact, Government members when making speeches dislocated their arms trying to pat themselves on the back. I think they should now hang their heads in shame because the allowance has not been altered for three years and people in need of that support are not receiving it. The Government is good with slogans but poor on action.

It has reduced its support for the education system and has made it clear that it does not consider that the State education system or the systematic Catholic schools education systemwhich deals with those people in the lower income groups in the general community- are worthy of support. The Prime Minister (Mr Malcolm Fraser) has made it quite clear that, as far as he is concerned, there will continue to be a transfer of resources away from the low income school areas to the areas of the A class school. I have quite a few in my electorate. Members of this Government have talked and beaten hollow drums about their concern for the family and yet they are presiding over a situation where in every respect the levels of support for families, on a government basis, are being eroded by inflation.

In the field of social security, children’s allowances have been completely forgotten by the Government, as have tertiary allowances. Who is disadvantaged most by the freezing of those payments? They are the people who have the lowest income in the community. One’s income has to be extremely low in order to qualify for those benefits. In this country today if one’s income is under $10,000 a year one can expect no sympathy or concern at all from this Government. As the Minister has said, this Government’s policies are to ensure that it delivers the goods. Every time it can get them over the wall it is delivering those goods as far away as it can. It shows no concern at all for the interests of Australia or Australians. It shows no concern at all for encouraging Australians to develop their own country. It believes that it is far better to take the easy and popular way out.

After all, when the Prime Minister goes overseas, if someone has made a few million dollars out of a swift deal in Australia it is more likely than not that he will be welcomed in that person’s country. We are selling out Australia. We have in vogue a multi-million dollar program which is designed to ask Australians to be proud of their country. One of the songs even says: Stop passing the buck’. This is a reversal of the normal situation in most areas, where the leaders of nations accept responsibility for the decisions they make. This is one government in which the leader never accepts responsibility for anything and never fails to get up in this House and say that it is someone else’s fault, no matter what happens.

The Minister for Health has just made a full speech in which he told the Parliament that he was upset about the Labor Party’s policy on health, when he himself has introduced in Australia a situation where no greater confusion on health care has ever existed and no lesser cover has ever been available to those who are sick since health was accepted in this country as a government responsibility. I might add that that was done by referendum. The Government schemed and connived to prevent Medibank from coming into operation. Since it returned to office it has used the health system of Australia for any reason other than the delivery of health services. On one occasion it was used to reduce the cost of living index for temporary purposes, so that the Government could claim a reduction in inflation.

In the Government’s eyes, families do not count -

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member’s time has expired.

Mr KEVIN CAIRNS:
Lilley

-The battle of El Alamein was a turning point in World War II in more ways than is generally imagined. As we know, from that time on the Allied forces in North Africa turned the tide, the reputation of Montgomery was made and that of Field Marshal Rommel began to be unmade. It was a turning point in another way, because during the week of the battle of El Alameincertainly during that month- there was released in Great Britain the first of a trilogy on the interests of Lord Beveridge which he pursued in the latter years of his life. That work was entitled Social Insurance and Allied Services’. It was the kind of work which gave a foretaste of a better post-war world for war-weary soldiers and a better post-war world, after 1945, than the soldiers and their families had experienced during the 1 9 10s, the 1 920s and the 1 930s.

Within two years the same Lord Beveridge took part in a second event, which was the release of the famous work which revolutionised the responsibilities of governments in the Western world. This was his work on full employment in a free society. It merely said that demand could be so managed in the Western world as to cause work to be available for those who desired it. But almost within the release of that work the seeds of problems were sown. At a meeting in early 1944 Lord Beveridge was told that in order to bring about his aim it would be necessary that there be restrictions on arbitration and restrictions with respect to collective bargaining and that there be certain price control measures. At that time the union leaders told him that they rejected this, that the common sense of the unions could be relied upon to restrain wild inflation, and that any element of regimentation was unacceptable in peacetime. The other side of that argument is simply this: Were those restrictions and obligations to be put aside, his aim of full employment in a free society could not be consummated. I merely mention that in passing.

I then come to the third interest in Lord Beveridge ‘s life. This was in the late 1950s and early 1960s. He then began to be worried about the social effects of what he regarded as continuous inflation upon the aged, and the ensuing problems in relation to the requirements of social services within his community. I recite that story in order to indicate to the House that encapsulated within that period of less than 20 years are the problems that we have today. There was a problem with respect to the organisation of society for full employment and the accompanying problem of the organisation of society so as to deliver social security for those who require and demand that it be delivered. Those are the main aggregates of the matters with which we are dealing. But the unstated assumption of all that Beveridge said was that there had to be transfers within society, whether within a health system- of which the Minister for Health (Mr Hunt) would be aware- or within a social security system.

From time to time I have heard leaders of the Opposition say: ‘We do not want the young and the healthy to insure; we want them to pull out of insurance.’ It should be quite clear that they are abusing the principle of insurance, which is that those who are in need can gain a transfer from those who are not so much in need, and that they are abusing the principle of social justice within a tax system where some pay and some benefit. The payers and the beneficiaries cannot always be the same people. The proposition that has been put forward from time to time- namely, to pull the young and the healthy out of the health insurance system- is an abuse not only of Beveridge ‘s principles but also of reasonable principles of social justice.

Therefore, what is required in a government is that the twin tasks that Beveridge faced in his latter years be accomplished together- especially since 1973. It was not so difficult to accomplish them in Australia until that time, but in 1973 this country and the rest of the world had experienced the external effects of the oil crisis. I ask this House to bear in mind the response of Australia to the oil crisis of 1973-74, and what would be a Labor government’s response to a similar crisis of 1978 and 1979-80. If we go back to 1973-74, we now know that there were three countries which responded to that crisis in a very careful and very gauged manner. They did not over-expand their economies; they controlled their economies and their people accepted that control. Those three countries were West Germany, Japan and Taiwan. At first their performance was not as good as that of Australia, but in all the subsequent years their performance has been incredibly better than that of the countries that ignored that lesson.

Which were the countries which did quite the opposite? They were Australia, Italy, the United Kingdom and, to a significantly lesser extent, the United States. I merely say that in response to any crisis, whether it be the oil crisis of the 1973 period or the one which is presently upon the Western world, honourable members should ask themselves whether Australia is going to go for the short term solution or the long term solution. Had one looked at Australia in 1973-74 one might have thought that it was doing reasonably well; but it had sown the seeds of its own disaster at that time. Therefore, one has to look at an ultimate solution and not at a short term solution close at hand.

It is not unlike the story that is told of a very famous British journalist who was interested in world affairs. He saw Mao Tse-tung three years before he died. He said to Mao Tse-tung: ‘What do you think the world would have been like had Mr Khrushchev been assassinated and not President Kennedy’? Mao Tse-tung thought for a moment and he said: ‘ I do not think Mr Onassis would have married Mrs Khrushchev.’ In other words, one is dealing with a broad and ultimate solution and not with the easy solutions close at hand, no matter how inviting the smart responses might happen to be. Our task therefore is to bring about a series of events. We have to consider Australia in the 1983-84 period and not make all our judgments upon the six months between the middle and the end of 1979. That was the way judgments were made previously.

How is that being accomplished? What is happening to public expenditure in Australia? I am invited to refer to one area because of the proposition put forward by the previous speaker, the honourable member for Corio (Mr Scholes). I mention the aged. He asserted that the aged in Australia are doing badly. That is not correct. It is a foolish proposition. The honourable member does not know what he is talking about. Let me give one or two figures to the House. I dislike giving too many figures but these deserve to be given. In the middle 1960s less than 1 1 per cent of the total government outlays were directed towards welfare for the aged. That included precise programs for the aged and others in which the aged share, such as the health program in which the Minister for Health, who is at the table, has some interest In 1979 that figure is just on 19 percent.

Mr Hunt:

– What is the difference?

Mr KEVIN CAIRNS:

-Total expenditure on welfare for the aged has increased from 1 1 per cent of government outlays to 1 9 per cent. That is an enormous increase. The Government and, through it the Australian people, has given that welfare to the aged. The Government is honoured to give it. At the present rate of increase between 23 per cent and 24 per cent of total government outlays will be spent on welfare for the aged by 1984-85. That will include explicit programs, such as aged pensions and aged persons’ hostels, and other programs in which the aged share, such as the general hospital and health program. We should not play politics with this fact. We should recognise it without deliberately trying to cause a conflict of generations. Were that to occur Australia would be the loser.

One has to see what kind of economic policy can be grafted on to this drawing power in terms of public expenditure. If there were to be resistance to an increase in public expenditure in Australia, a government that would go into that field with its ears back, having the drawing power to which I have referred, could commit a grave error. I was concerned, therefore, to observe that the Opposition does not seem to have learnt much. Knowing that there is that justified drawing power in relation to welfare, we have heard a confession of the general taxation policy of the Opposition. This will exacerbate and worsen the situation to which I referred. I now refer to a very interesting lecture, the F. E. Chamberlain lecture, given by the Leader of the Opposition (Mr Hayden) in Perth on 2 March 1979. He is one of the people who criticise us with respect to taxation. On page 11 of the Chamberlain lecture he said:

The challenge to traditional democratic socialism has been expressed in a number of deeply dispiriting doctrines. One example, is the rapid spread or philosophies based on lower taxes and smaller government. Fraserism was one or the earliest expressions of these philosophies, although Mr Fraser’s practice has been rather erratic. This sort of approach strikes directly at the conventional democratic socialist notion that equality and equity can only be assured by a stronger public sector.

If we have a stronger public sector we will also have a stronger public taxation sector. Those factors have to accompany one another. The Leader of the Opposition poured scorn on the late Richard Crosland who argued that welfare could be delivered by means of greater economic growth; that greater economic growth would generate the resources that were able to be redistributed. Having confessed the total taxation policy to which the Opposition is committed, the Leader of the Opposition rubbished the fact that increases in taxation can be avoided by having a faster rate of total economic growth. He put Crosland in his place. Going back to what Beveridge said, I am simply arguing that one has to look at the total growth policies responsible for employment and the policies with respect to public expenditure which themselves are intimately related to the rate of inflation. It is not surprising, therefore, that at the Australian Labor Party Conference in Adelaide on 18 July 1979, having listened to the Opposition’s oil policy which was decided subsequent to the discussions on economic policy, the Premier of New South Wales said:

I think we had a bit teo much of that on the economic policy, when we went on for hours and got words slipped in here and great victories and great losses, but in the result we finished up with a bit of a hotch-potch of a policy.

What is a hotch-potch of a policy? Is it just a jumble? Is it a mess? Some people say more precisely that it is a mutton broth with lots of vegetables in it. I do not want to parody that proposition. We should ask ourselves who are the lambs that will be led to the slaughter as a result of that hotch-potch policy and that mutton broth. Above all, the Australian taxpayers will be led to the slaughter. Let there be no mistake about that whatsoever. We ask that these matters be understood. We ask that they be considered because they deserve to be considered. Australians will tolerate only bearable levels of taxation. They will not tolerate levels of taxation that are unacceptable. If a government wants to embark upon all kinds of experiments in addition to the drawing power to which I have referred, the taxation grab will be up in the future as it was in the past.

Let me recite one or two pieces of evidence to which I referred this afternoon. They are worth referring to whatever one says. A country will tolerate a level of taxation which is appropriate to its people. Quite clearly, Australians will not tolerate a high level of taxation. They will tolerate a level of taxation significantly below that which is tolerable in West Germany, for example, owing to the different nature of its people. A judgment has to be made in respect of each country. This fact should be remembered about the Opposition’s term in office: During the three years it was in power the rate of increase of taxation was the highest of any industrialised country in the world. In other words, the rate of increase in taxation beat every other country which has a market economy and for which taxation rates are measured. As I said this afternoon, in 1972 out of 23 or 24 industrialised countries Australia was 21st or 22 nd in the rate of increase in taxation. It was at the bottom of the list. The next year Australia was first. In the subsequent year it was second and in the third year it was fifth. Its performance over those three years beat that of every other nation in the world.

If people learn nothing from the past that is up to them, but it is appropriate to realise what would happen if the same people with the same philosophy, ignoring the experiences of the past, were returned to power. This philosophy is supported by the F. E. Chamberlain lecture in Perth in March this year by the Leader of the Opposition. Can anybody reasonably say that the Opposition would not repeat its performance and do again what it did previously? I merely ask the House to consider the proposition. After all, everybody wants taxation to be reduced. One does not have to be a Lafferite to do it. The honourable member for Werriwa (Mr Kerin) would agree with that. One might have to acknowledge the words of Dr Clark in 1945. To go upon the same path that was traversed before would be very damaging indeed.

Each country has to make this judgment in terms of taxation. How can a party come into this Parliament and say that the taxation rate should be reduced and at the same time say: ‘If we get into power we will pay political candidates money; we will pay political parties money. We will pay the taxpayers’ dollars to those who are standing for election, whether it be in terms of parties or persons’? How are we to believe, under those circumstances, that there could possibly be a stabilisation of taxation rates with the Opposition in power? I ask the House merely to consider these matters, and to consider them very carefully.

I return to where I began. Lord Beveridge, during the last 20 years of his life, was concerned with three features of life. One was the provision of an adequate level of social security and social services within a country. That concern was manifest during the depths of World War II and had more effect than many would imagine in stabilising the democracies after World War II. Lord Beveridge was committed to full employment but with the necessary control of demand that was part of full employment. In his latter years, he was concerned with the effects of inflation upon social security and old age. We merely say that each of those aggregates deserves to be considered and has to be considered. If a government comes into this chamber and ignores them it commits a very grave fault and it ought to be rejected for committing such a fault. I just do not understand how anyone can promote the doctrines that have been promoted by the Leader of the Opposition and this afternoon by the honourable member for Gellibrand (Mr Willis) and others. They remind me of a famous Cook Island political leader who went to New Zealand where he was able to observe a famous political party in operation and said: ‘That mob are so inept that if they formed a firing squad they would make a circle and face inwards’. We are concerned about ensuring that when members of the Opposition face inwards they fire the correct bullets with respect to an appropriate rate of taxation, show appropriate concern as to the main aggregates in the economy and, above all, do not repeat during the oil crisis of 1979 the kind of infamy that they repeated during the oil crisis of 1973.

Mr KERIN:
Werriwa

– It is always a pleasure to follow the honourable member for Lilley (Mr Kevin Cairns) in a debate. Except for his politics, he is not a bad sort of bloke. He is one who generally uses fair and logical arguments. He has had a few cracks at the Australian Labor Party and the Labor Government. Thankfully he did not blame Mr Whitlam for the oil crisis in 1973. The honourable member pointed out that Mr Wran had said something about the Australian Labor Party’s economic policy being a hotchpotch. I suppose that the Opposition will have to live with those words from now on. It is also obvious that the Liberal Government will be hammering a point about our economic policy being a sellout to the Left and that sort of nonsense. Anyone can pick up the words said at a conference and use them to advantage. Anyone can pick up and use the word said by the Minister for Health (Mr Hunt) in relation to his opposition to what the Liberal Party of Australia is doing in Queensland. Anyone could point to the words said at the weekend by the Minister for Finance (Mr Eric Robinson ) and the Minister for Defence (Mr Killen). In politics, the use of intemperate words at times is something that we are all well aware of and familiar with.

The fact of the matter is that the economic policy of the Labor Party as thrashed out in Adelaide was not a sellout to any faction or to any individual; it was a simple, pragmatic approach as a result of debate. We have already tried one prices and incomes referendum in this country and I am quite sure that if another one were to be put up the same fate would befall it. The ALP’s economic policy at present is a significant and straightforward response to the economic problems of the day. I was very pleased to hear the honourable member for Lilley say, quite properly, that what happens in one year is not as a result of the preceding period. I want particuularly to talk about leads and lags as they are known in economic jargon.

Mr DEPUTY SPEAKER (Mr Millar)Order! I remind the honourable member at this point that he is required to address himself to the amendment.

Mr KERIN:

– I am quite prepared to speak to the amendment, Mr Deputy Speaker. I want to address myself to matters of a general economic nature, particularly in light of the amendment of the honourable member for Gellibrand (Mr Willis). During the last four or five years, through constant repetition of simplified arguments and arguments that are best described as diametrically opposite to the truth, the LiberalNational Country Party Government has managed to get away with propounding two major economic frauds. The first is that LiberalNational Country Party governments are better than Labor governments at managing such things as the money supply and other economic variables. The second is that everything in economic policy has to be subordinated to reducing the Budget deficit. This is the idea of inflation first, to heck with the unemployed and down with notions such as public works expenditure. One can label these frauds. One can label the first one as the money supply myth and the second as the Budget deficit myth. I believe, and I am sure that most economists believe, that the facts of the situation are as follows: Firstly, the record of the Liberal-National Country Party Government in managing the money supply was and still is extremely bad. In fact, it was the failure of the Liberal-National Country Party Government under the right honourable member for Lowe (Sir William McMahon) in 1972 which led to many of the subsequent economic problems in 1973 and 1974. Secondly, the Budget deficit is important, but there are many other aspects of economic policy which are also important. The Fraser Government has allowed the objective of reducing the Budget deficit to become a fetish.

I turn to the first proposition about the money supply. It is true, as members of the present

Government are fond of telling us, that responsible control of the money supply is desirable. What is not realised, however, is that it was the McMahon Government in 1972 that left us with a legacy of monetary instability. It was in the last year of the McMahon Government that the rate of increase in the money supply really got out of control. Mr Deputy Speaker, I seek leave to incorporate in Hansard a table regarding the nominal and real rates of growth of money supply for the years 1970 to 1979.

Leave granted.

The table read as follows-

Mr KERIN:

– This table shows the annualised rates of growth in respect of the money supply as expressed in Ml and M3, the consumer price index and the real growth in Ml and M3. This table shows that even in nominal rates, the rate of increase in the money supply for the last two or three quarters of the McMahon Government was the highest in Australia ‘s history. That is bad enough. This was after a period of relative price stability. This was after a period when the money supply during the 1950s and the 1960s was not important. It was not important internationally. It was not until the 1970s that the worldwide growth in the money supply got out of hand. I will not go into all the reasons for that but there was speculation in both commodities and currencies caused partially by the failure of the Bretton Woods Agreement in 1971 and the onset of excessive liquidity in America as a result of the Vietnam War.

During the quiet period of the 1950s and the 1 960s, running up to 1 972 , we had a dme or relative price stability. But the table shows that in the last three quarters of 1972 the nominal increase in the money supply was the highest ever in Australia’s history. That is bad enough. But if we take out the rate of increase in the CPI- that is, we get the real increase in the rates of money supply as expressed as Ml and M3- we find that it is really bad in real terms. In fact, it is even worse in real terms; it is by far the worse. It was far worse than any period- any quarter on any six months period- under the Labor Government. The people who say that they are the good money managers are the people who left us with this legacy.

If there is a high money supply and if that is fed into an inflationary situation, an increase in the money supply has to follow. But even so, the Labor Government did a great deal to rein in the money supply. One has only to look at the last column of the table, which refers to the period of office of the Labor Government. In inheriting this increase in the money supply, it was inevitable that wages and prices would increase. That was the legacy that the Liberal-National Country Party Government left us. This, of course discredits those honourable members opposite who say that they were or are better money managers. When one looks at Ml and M3 one finds that it was in the six months to December 1972 that the money supply grew at the fastest rate in nominal terms. It was the fastest rate that we had had for 20 years to that stage and it has not been equalled since. In nominal terms, the rate of increase in 1975 approached that of 1972, but of course the rate of inflation was much higher and to adjust for this we must look at the figures in real terms. When we do so we see that the real increase during Labor’s term of office did not approach the rate that the Liberal-National Country Party Government left us with.

Largely because the Liberal-National Country Party Government refused to revalue the foreign exchange rate in 1972, there was an unprecedented increase in the money supply in the 12 months before the Labor Government came to office. As I said, throughout the 1950s and 1960s the average annual increase in the money supply was about 6.5 per cent. Because of the large surplus in the balance of payments in 1972 there was a great influx of money from overseas and the domestic money supply increased in a dramatic way. The second main increase was caused by the Liberal Government’s expansionary fiscal and monetary policies in 1972. In 1971 the Liberal Government planned for a domestic budget surplus of $630m. In fact, the surplus was about $390m, which was the smallest domestic surplus since 1968-69. On top of that, the Liberal Government election Budget of August 1972 reinforced the expansion. After all, it had nothing to lose. In August 1972 it budgeted for a domestic deficit of $60m. In the 12 months to December 1972 the domestic money supply increased by about 20 per cent, or about three times the annual average increase for the previous 20 years. Nearly 1 7 per cent of that 20 per cent increase took place in the six months to 1 December.

That was a classic case of too much money chasing too few goods. That was the legacy that the Liberal Government left to the Labor Government. There is no doubt that this greatly contributed to inflation during 1973 and into 1 974. We now know from bitter experience just how long it takes to get the economy back on an even keel when things go astray. After four years in office the present Prime Minister (Mr Malcolm Fraser) has not even begun to achieve what he promised he would do in three years. What chance did the Labor Government have in 1 973 and 1974, before a forced election, when it was left a legacy of absolute monetary irresponsibility? It is now widely accepted by economic commentators that much of the problems that Australia experienced in the years after 1972 can be attributed to the monetary explosion in that year. For example, I can cite Professor Porter of the Monash University. In an article in a German journal, the Weltwirtschagtliches entitled: ‘External Shocks and Stabilisation Policy in a Small Open Economy’, he said:

Monetary instability in Australia can be traced back to 197 1, the time or a refusal of the coalition government to revalue the currency.

So he goes on. I can cite other academics. For example Davis and Lewis, in the publication Monetary Policy stated:

Similarly, the failure to revalue the exchange rate after the currency realignment led to an undervalued currency, prompting both an improvement on current account and a speculative inflow of capital . . .

Inflation began to accelerate, in pan in response to these pressures . . . and ‘stagflation ‘appeared.

Again, they stress that a lot of the inflation during 1 973-74 was due to the irresponsible policies of the Liberal Government, particularly during 1972. What were the consequences of this monetary explosion? As I have said, many of the economic problems between 1973 and 1975 were the direct result of the monetary explosion- for example, the wage push of 1974. The Liberals had made enormous political capital out of that. Perhaps with firmer policies, some of the wage push could have been controlled, but the majority of it was due to the monetary explosion of 1972. Throughout the world, wherever there has been a monetary explosion of this sort, wages have followed. Even Milton Friedman, the high priest of the monetarists, said quite categorically when he was here that trade unions do not cause inflation. In terms of monetary policy, as far as Friedman and most of the respected monitorists are concerned, if there is a buildup of money in the economy, stability goes out the door and prices and wages increase.

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– There never has been a decided and determined correlation. It is now ‘said that there is an 18 month lapse, but it could be a 1,000-year lapse.

Mr KERIN:

– Even Milton Friedman concedes that trade unions do not cause inflation. He has pointed to the effects of an increase in the money supply in terms of the Australian Conciliation and Arbitration Commission. I am quite sure that when we have an arbitration commission that has to deal not with economic variables but with industrial peace, there is an even stronger reason to say that the increase in the money supply during 1972 very much caused the wage push of 1974. I believe that the McMahon Government of 1972 must answer for much of the wage push of 1974. Higher rates of inflation in 1973 and 1974 were inevitable once the money supply had been allowed to rise to over 25 per cent per annum.

The Labor Government did much to try to control inflation. I shall reiterate some of the steps that were taken. For example, there was the revaluation of the Australian dollar. It is not widely realised just how significant these revaluations have been. In December 1972 there was a revaluation of about 7 per cent, in February 1973 there was a further effective revaluation when the United States dollar was devalued by 10 per cent and we did not follow, in September 1973 there was a further overt revaluation of about 5 per cent and since May 1974 there has been an effective revaluation, which has gone largely unnoticed, of a further 7 per cent against the Deutsche mark because we are tied to the

United States dollar which has been strengthening in world currency markets. We also had variable deposit requirements. Levels of 33.3 per cent and 25 per cent certainly helped curb the inflow of liquidity during 1973 and into 1974. There was a tariff cut of 25 per cent. We strengthened the Prices Justification Tribunal and introduced or strengthened the Trade Practices Act, and we cut back the rate of growth in the Public Service by one per cent.

What was the cause of the monetary explosion under the Government of the right honourable member for Lowe? I think it is useful to look back over the history to see what can be learnt. There is an important lesson to learn from the Liberals’ failure in 1972. Since a Liberal government cannot revalue because of opposition from the Country Party, an inflow of capital from overseas is very inflationary under a Liberal Prime Minister. But the present Government’s strategy is caused by expectations of capital inflow. The explosion of 1 972 was caused by the fight between the Liberals and the Country Party at Christmas time in 1971. The right honourable member for Lowe wanted to revalue but the Country Party refused. The result of this was an enormous build-up of foreign reserves during 1972 which spilled over into the domestic money supply.

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– I want my way. I want to make this -

Mr DEPUTY SPEAKER (Mr Millar)Order! If the right honourable gentleman feels that he is being misrepresented he can seek redress. He will resume his seat. The honourable member’s time is running out.

Mr KERIN:

– What would happen if, as the Government hopes, there is a capital inflow in the coming year?

Mr DEPUTY SPEAKER:

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

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

- Mr Deputy Speaker, is it practicable for me to make a personal explanation now?

Mr DEPUTY SPEAKER:

-If it is on the score of a specific misrepresentation, but certainly not if it is to enter into debate on some issue which I rather feel may broaden.

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– It is not a specific one, but a series of mis-statements. There were six or seven.

Mr DEPUTY SPEAKER:

-Under those circumstances the right honourable gentleman might like to launch a very effective response at another time.

Mr PORTER:
Barker

-There is no doubt that this Budget is the right one for Australia at this time. There has been a return towards a more fundamental strength in the Australian economy. Solid progress has been made by the Government in correcting the imbalances in the economy. The most obvious success of the Fraser Government’s policies has been the reduction in inflation. Table 6 of the Budget Papers at page 21 clearly shows this. In 1974-75 the inflation rate was 16.7 per cent. Thereafter it fell year by year. In 1975-76 it was 13 per cent, the following year it was 13.8 per cent, the following year it was 9.5 per cent and last financial year it was 8.2 per cent. This clear trend downwards has been interrupted recently by a number of external events over which the Government of Australia has little or no control.

The first and most obvious event which immediately comes to most people’s minds is fuel prices. The increase in the Organisation of Petroleum Exporting Countries price of oil, with the Government’s policy of parity pricing, has clearly put an upward pressure on fuel prices. This price increase has brought to the attention of all Australians the scarcity of this resource and the need for conservation. The flow through of the OPEC price increase for oil will clearly affect the inflation rate in this country. It is worth mentioning that as a measure of the Government’s concern over the fuel situation, this Budget provides incentives for exploration, research and development. The Budget also provides an outright tax deduction for firms converting oil-fired equipment to other energy sources, such as gas. Clearly, all three of these moves will help to conserve our scarce oil for our cars and tractors. However, I repeat that there is no doubt that the increase in the price of fuel will be reflected in the consumer price index. It is worth noting that whilst we pay a little less than 30c per litre for fuel in the capital cities, the equivalent price in Australian cents per litre of motor spirit is 48.9c in Japan; 46.5c in the United Kingdom; 41.7c in West Germany; 49.8c in France; and 51.6c in Italy. I am advised that among our major trading partners the United States and Canada are two of the few countries which have pump prices lower than our own.

Another external factor which has had an effect on our inflation rate has been the strong demand for beef in the United States and other overseas markets. We have long been waiting for a boost to our beef exports and a recovery in incomes for those relying on this trade. However, there is no doubt that the subsequent price increases for export beef have fed through to higher domestic prices and as housewives and families switch to other meats those prices also have increased to meet the increased demand. This has resulted in a welcome increase in farm incomes. However, it has had an effect on pushing up the rate of inflation. The increased farm output and exports result in increased income in the hands of farmers, increased export income for all Australians and increased orders for plant and machinery for the manufacturing industry. The flow-on effects all these increases generate more employment and this benefits everyone. There is no doubt that these advantages outweigh the upward pressure such price increases have on the consumer price index.

However, it is clear that whilst wage increases are linked to the CPI the inflation rate will not come down as fast as we would have liked.. There are two important, points as to the short term future and the prospective CPI increases for the next two quarters. The last CPI increase for the June quarter was 2.7 per cent. It will be recalled that early in July, following the OPEC price increases, oil price rises started to flow through to the petrol pumps. Similarly, the new medical insurance rates took effect from 1 September. These two prices could have a combined effect on the CPI perhaps of the magnitude of less than 2 per cent. Thus one may think that the September CPI increase will be an exceptionally large one, taking into account the petrol prices, the medical contributions and the other general price increases. However, I want to make two important points. I am informed that the fuel prices for the September CPI were measured on 15 July, before the full effect of the OPEC increases was felt at the petrol pumps. Therefore, the effect of the fuel price increases which could contribute about ohe per cent to the CPI increase, is likely to be included not in the September quarter CPI figures but in the December quarter figures. Similarly, I am advised that for the September quarter the cost of medical insurance was taken in the middle of August. Therefore, the increase in medical contributions which took effect from 1 September is also unlikely to be included in the September CPI increase. If the September CPI figure is about the same as the June CPI figureand honourable members will recall that that was 2.7 per cent- then clearly, without the inclusion of the price increases for fuel and medical contributions the December quarter CPI increase could be higher. This delay in reflecting price increases of fuel in July and medical contributions in September, which could add between one to two points to the December CPI figure, could well give a false impression of the direction in which the economy is heading at that time.

The point I make is that whilst it is almost impossible to make accurate predictions of the inflation rate because of the effects of such things as overseas oil price increases, which are wholly beyond the control of our own Government, it seems clear that the inflationary pressure caused by the factors which I have outlined could well be easing by November-December this year and therefore people should not be unduly alarmed by a large December quarter CPI increase. It may well reflect only the lags I have outlined in the collection of data.

I move on now to review the effect that this Government’s consistent budgetary policy of fighting inflation has had on the economy. I refer to page 5 1 of Budget Statement No. 2. It reads:

While success on the inflation side has been the more obvious, it is also clear that considerable progress has been made in righting a number of the other distortions in the economy.

The Budget statement then discusses the need for moderation in wage increases and the need for company profits. However, it is worth noting that the statement goes on to say that as a result of our consistent economic policies, to correct the basic distortions which became apparent in the economy under the Whitlam Government there has been, quoting from the same page: . . a marked improvement in Australia’s international competitiveness, arising both from exchange rate adjustments and from the reduction in Australia’s domestic inflation rate. While there are major conceptual and other problems in attempting to construct measures of international competitiveness, various unofficial indexes tend to suggest that Australian industry may now be about as competitive as it was in 1971.

Let me cite some figures to show how after five difficult years we are starting to restore the economy to the more successful pre-Whitlam days. There has been a sharp turnround in rural exports which has played an important part in our improved international position. For the financial year just completed, the value of rural exports was some 16 per cent greater than in the previous financial year. There was also a strong rise in the volume of non-rural exports which resulted in a growth of some 1 7 per cent in the value of exports. Further, in the year to June 1979 exports by metal manufacturers increased by 3 1 per cent compared with an increase of just over one per cent in the previous year. The export of machinery and transport equipment last year was up by 23 per cent. Clearly our ability to export has been enhanced by our effort to reduce the rate of inflation in Australia. Therefore, the cost of our goods to those people who are buying them overseas is reduced.

It will be recalled that at one stage under the Whitlam Government the rate of inflation was five points above the average rate for member countries of the Organisation for Economic Cooperation and Development. Up to the last six months Australia’s inflation rate of about nine per cent is nearly three points below the OECD average. Let me give some specific examples. In western Europe in the six months to June 1979 I am advised that inflation stood at about 10.7 per cent. In the United States of America it was 12.3 per cent. In France it was 10.5 per cent. In the United Kingdom it was 13.7 per cent and in Canada and New Zealand it was 10.1 per cent. Compare those rates with the nine per cent in Australia. Obviously while we can maintain an inflation rate lower than that of most of our trading partners our international competitiveness will be enhanced. I believe the figures I have cited show that we are coping better than many other countries with the problems of inflation and we are starting to reap the rewards.

Another indicator which gives a hint of the view taken of the Australian economy by overseas investors is the inflow of foreign investment in enterprises in Australia. The Australian Bureau of Statistics in its ‘Foreign Investment Series’ for 1977-78 at page 38 reveals the total annual investments in Australia from 1947. It is quite clear from those figures that the foreign investment in Australia of about $ 1,400m in the early 1970s collapsed during the Whitlam years to under $494m. In other words, it was reduced by two thirds. In 1974-75 and 1975-76 there was a slight increase but investment from overseas was still less than $900m.

However, in the last three financial years there has been a marked turnaround. In 1976-77 capital investment from overseas increased from $785m to $l,562m-it nearly doubled. In other words, the confidence that overseas investors expressed in the Australian economy following the introduction of this Government’s first Budget was overwhelming. In 1977-78 the capital inflow was $ 1,276m. For the last financial year I am advised that that figure has further increased to $ 1,874m. Clearly, overseas investors believe that Australia is handling its economy properly. As a result, they are willing to invest here. Of course, their investment offers the prospect of future jobs.

I believe it is worth noting that for the first time in six years there has been an increase in employment in the manufacturing sector of this country. I accept that it is only a very small increase but at least the indications are that with the increase in confidence in the business sector in Australia there will be an increase in employment. The employment growth of about 1 per cent over the course of 1978-79 was concentrated in the private sector rather than in the public sector. This is a most welcome sign because it was in private employment that jobs were lost. It is in this sector that jobs have to be regained. At the end of August unemployment was 5.8 per cent of the labour force as compared with 6.2 per cent a year earlier.

Whilst there will be no miraculous turnarounds in the rate of unemployment it is quite clear that the signs of improvement are encouraging. There are, however, some worrying factors which must be taken into account and met head on. The general view overseas is that the outlook for the world economy is subdued and that we in Australia cannot expect to be completely immune from the consequences. However, it is clear from what I have said that we are in a sound position. In fact, the confidence of overseas investors in coming to Australia shows that we are in a sounder position than most of the industrialised world and thus are judged to be able to withstand such difficulties. If we can maintain our international competitiveness we will make the most of the international opportunities offering. Clearly another round of price hikes or wage hikes will eradicate that competitive edge we have built up over the past four years.

I turn for a moment to some of the personal aspects of the Budget. It is quite clear that as from 1 December the surcharge will be lifted and people will pay less tax. The Treasurer (Mr Howard) said in May this year that it may not be possible to reintroduce tax indexation and remove the surcharge in this Budget. That was a quite clear, precise and open statement made in this House. Therefore, anyone who suggests that this Government has tried to put one over the Australian public is just not telling the truth. The surcharge was introduced in the previous Budget as a measure, amongst other things, to reduce the Budget deficit. The need for the surcharge was explained to the Australian people. It was an open and clear tax. The Leader of the Opposition (Mr Hayden), in his speech on the Budget of 22 August 1978, said, as reported on page 625 of Hansard:

For those in the higher salary range the surcharge will mean a tax increase of 2.5 per cent in a full year or 5 per cent in the eight months. I am hoping to persuade the House that this is another example of inequity, another example of Government policies which are giving more to those who have and less to those who have not. The surcharge will be a greater burden per cent on those with lower incomes than it will for those on higher incomes.

So said the Leader of the Opposition after last year’s Budget. One would think that if his statement is correct the benefit of the removal of the surcharge will go to those people whom he suggested at that time were to carry the greatest burden- that is, the lower income earners. Surely that would be the honest and forthright conclusion to draw. However, that is not the conclusion which he drew.

Mr Chapman:

– He never knows what he is talking about.

Mr PORTER:

-That apparently is the case. It seems that when we put the surcharge on in 1 978 we were harming those on lower incomes and in the lower income brackets. When we took it off this year he said we were only benefiting those at the top of the income scale. In this year’s speech on the Budget, on 28 August, the Leader of the Opposition is reported on page 662 of Hansard as having said:

  1. . those families who finish up getting a dollar out of this latest tax rort can count themselves as doing well. I should point out of course, in the interests of balance, that those people at the top end of the income scale will do a lot better than a dollar.

Really, the Leader of the Opposition just cannot have it both ways. If he says that the lower income earners were relatively worse off when we put the surcharge on, he cannot say a year later in his speech on the Budget that they are to receive the least benefit. I suppose the old adage that you can make figures say whatever you want is applicable here. However, I think that the Australian public deserve a little bit of consistency. This Budget is consistent with previous Budgets brought down by this Government. Our Budgets have endeavoured consistently to reduce inflation, large government and the deficit; to encourage private enterprise and initiative and in the long term raise the living standards of all Australians. This Budget sets the framework for further economic recovery for Australia. Let us all work together to achieve a better and more prosperous Australia so that we may all share the benefits which flow from prosperity.

Mr WEST:
Cunningham

-Last year’s Budget featured a number of spectacular and vicious attacks on wage and salary earners and pensioners in this country. This year the attacks have been slower and more insidious. We can expect even worse results from the disease of deliberate contraction of the economy. This year the Government avoided the mistakes of last year such as the vicious tax on newsboys and the starving of pensioners because of its refusal to increase pensions on a half-yearly basis. But perhaps this year’s Budget pill inexorably will become more bitter as the contractionary effects of this Budget become obvious. These contractionary effects will be caused by a number of deliberate economic policies. I refer to the cut in the domestic deficit of a massive $ 1,400m, the cut in Government and specific purpose grants to the States and the real increase in income taxes over the next 12 months which will be managed under the cloak of the alleged removal of the 2.5c in the dollar but not until 1 December. Then there is the imposition of selective indirect taxes to the massive extent of $3 billion via the oil excise levy and the petrol tax at the pump, the final burial of Medibank and, finally, the erosion of real wages and family living standards. All of this will lead inevitably to further unemployment.

The Treasury admits that an extra 60,000 persons will lose their jobs this year as a result of the Budget. The Department of Employment and Youth Affairs admits that this is likely to continue over the next five years. What a great prospect that is for this country! It is clear that amongst the employed no one really thinks that he or she will be next to become unemployed, but try telling that to the 400,000-odd people who are currently unemployed and whose ranks are added to constantly, and not just by the unskilled or the semi-skilled. Professional people, university graduates and skilled workers are increasingly unable to obtain employment.

Since the Budget inevitably leads to further unemployment there has been understandable conjecture that the Prime Minister (Mr Malcolm Fraser) might want another early Federal election before this Budget takes effect. Perhaps the Prime Minister has been deterred by the recent fairly obvious vote of disaffection with early elections and perhaps he needs more time to intervene in order to patch up the coalition’s squabbles in Queensland. What then can we expect? Can we expect another mini-Budget, perhaps in May of next year? This year there was a mini-Budget of broken promises and perhaps next year we shall have a mini-Budget of election carrots. Has the Treasurer (Mr Howard) contracted Federal spending in August with a view to expanding the economy in May? After all, $500m could easily be regenerated from the domestic deficit and still leave an overall domestic deficit reduction of $900m?

The estimated $2 billion plus to be derived from crude oil levies is based on the prices of the Organisation of Petroleum Exporting Countries as at July 1 979. Nothing is more certain than that there will be further increases. Honourable members must remember that for every 5 per cent OPEC increases its crude oil prices and they are injected into domestic crude oil prices the Government stands to make another $300m. The next point I would like to make is that company tax receipts have been very conservatively estimated at $3,280m. They will be at least 10 per cent higher than that. Perhaps another $300m can be expected from that in Federal revenue. All of that adds up to some thing like $ 1,000m. Perhaps we can expect either full or half tax indexation to be paid in retrospect next year, instead of right now, as a means of effecting recovery and increasing demand to create jobs; and perhaps this will happen next year just before the Federal election.

I believe that the machiavellian tactics of the Prime Minister and the Treasurer are obvious. They are as reprehensible as their previous broken promises on tax indexation, to preserve Medibank and to provide jobs for all who want to work, to name just three areas. This strategy of contracting the economy now as a deliberate means of delaying economic expansion until next year means that the Government will coldly increase unemployment by 70,000 people to 100,000 people. The Government has exchanged the possibility of immediate job creation for the possibility of electoral enticements next year.

This Budget also makes it very clear that the economic relics from an outmoded era, now in control of Treasury, are also in full control of this Government. Those people are bereft of ideas, except to apply the discredited policies of the 1930s to the problems of the 1980s. Treasury has collected all the extra revenue that I have mentioned. It has collected an increase of $2.3 billion- 1 8 per cent increase- in personal income taxes. Selective taxes have raised $3 billion on oil and petrol sales. Those taxes are in the main attacks on motorists. Has the Government used the extra revenue to expand or create jobs? No, it has not. The Government has retained the extra revenue to contract economic activity in this country.

A prime example is the cutback in payments to the States for capital works. At a time like this- a time of recession- we ought to be spending money on capital works to provide the industrial and social infrastructure for future generations and to provide jobs for the current generation. But this year we have seen a cut in the general purpose capital grants to the States of 1 3 per cent in monetary terms and 2 1 per cent in real terms. We have seen a monetary cut of 5 per cent for specific purpose grants, which in real terms is a cut of 13 per cent. The sum of $72. 5m has been lopped off the specific purpose grants to the States.

The worst example of cuts in expenditure occurred in the area of welfare housing. This year only $260m has been made available, as against the $335m made available to the States last year. That is a 30 per cent cut in real terms compared with the appropriation in the last year of office of the Labor Administration. In 1 975, $384m was made available. Since then there has been a 41 per cent increase in the consumer price index. The sum of $560m-odd would be needed this year to maintain that expenditure in real terms. Instead, only $2 60m has been appropriated, which represents a cut of over 1 00 per cent in real terms. This is at a time when there are 73,000 applicants on the waiting lists for housing commission accommodation throughout Australia and 250,000 people living in caravan parks. Under the Labor Administration 6,000 dwellings were completed in New South Wales in 1974. Under this Government only 1,100 dwellings were completed there last year. There is little wonder that 71,000 building workers have lost their jobs in the housing industry throughout Australia since May 1975.

These cutbacks lead to further unemployment. Having caused that unemployment the Government unashamedly seeks to hide the effects of its economic policy. This is the reason why the Government wants to suppress the Commonwealth Employment Service’s figures on unemployment. I understand that today those figures are 397,000, compared with the figures that the Australian Bureau of Statistics produced a few weeks ago showing that 3 1 5,000 people are seeking full time employment. The Government still refuses to issue these figures simultaneously. It stopped issuing those figures simultaneously with the Australian Bureau of Statistics figures several months ago. The position now is that the media, interested parties and the Opposition have to request these figures. Why is this? The obvious answer is because the ABS figures are consistently 80,000 fewer than the CES figures. The worst feature of the current unemployment is the youth unemployment, particularly the rise in young unemployed females. The figures released today show an increase of 1 1 ,000 over the corresponding month of last year. In Wollongong, which is my own electorate, the number of females under 20 years of age who are unemployed has risen from 1,370 in August last year to 1,565 this year. So much for the claims of this

Government that it is improving employment opportunities throughout this country.

Let me suggest some immediate measures that this Government must take. It should lift the means test threshold for unemployed people from $6 to the $20 and $34 a week, that applies to single and married pensioners respectively. The Government ought to issue health cards to the unemployed. The Government must immediately index unemployment benefits that are payable to the unemployed who are without dependants. It should replace the Special Youth Employment Training Program with a scheme of subsidisation to employers who increase their net labour force.

I turn now to the question of cuts in wages and living standards. The Budget implies that there has been a 2 per cent cut over last year and this year in real wages. I suggest that it has been much more than that. In December 1975 nonmanagerial workers averaged $152 a week. In June 1 979 they averaged $2 1 1 a week. There has been a conservative loss of $14 a week as a result of full wage indexation not applying over that period. To that loss we can add the real loss in family allowance payments. At present family allowances are the same as they were when they replaced concessional taxation rebates for children back in 1976-77. Then they stood at $3.50 for the first child, $5 for the second, $6 for the third and $6 for the fourth. If half-yearly indexation had been applied, as it ought to have been, to those family allowances they would have risen, respectively, by $ 1 . 1 0, $ 1 .60, $2 and $2. So a family with three children is losing $4.70 a week because of this Government’s failure to index family allowances and a family with four children is losing $6.70 a week.

In the field of taxation, as a result of the latest tax mix, a family with an income of $12,000 a year is paying $322 a year more in taxation, or $6 a week, as a result of the failure to implement full tax indexation and the failure to remove the surcharge of 2.5 cents in the dollar until 1 December. No wonder wage and salary earners have refused to accept this Government’s offer of partial wage indexation; that is, indexation discounted for the effects of government economic decisions. The Government, through its Minister, says that this offer would amount to 80 per cent wage indexation. That is incorrect. It would be lucky to be 65 per cent indexation. In view of the losses that have already occurred in real wages, family allowances and taxation, it is not surprising that the trade union movement has knocked back what amounts to only a con trick upon the wage and salary earners of this country.

I turn in conclusion to the Government’s failure on energy policy. The truth is that this Government has no energy policy except to use petroleum products as revenue raisers. It is no wonder that the Leader of the Opposition (Mr Hayden) refers to every petrol bowser as a taxation office under this Government. There is no need for Australia to use Organisation of Petroleum Exporting Countries price rises as a means of raising revenue. One can say that OPEC gets the blame and the Prime Minister and the Treasurer take the money- to the extent of $3,000m. I refer also to the lack of a national gas policy. Only 3.5 trillion cubic feet of gas is in the Cooper Basin in current known reserves. That is enough to supply New South Wales and South Australia until 1987 and 2006 respectively. It is possible that as much gas again is in the Cooper Basin. On the North West Shelf there is 1 7 trillion cubic feet of gas. It is essential that we cut back proposed exports from there by at least one-third.

Mr DEPUTY SPEAKER:

-(Hon. Ian Robinson)- Order! The honourable member’s time has expired.

Mr JARMAN:
Deakin

-A Budget is a statement of probable revenue and expenditure, and of course of financial proposals for the ensuing year, brought down by a government. It is a responsible document, and the best Budget for the nation will not necessarily always be the most popular, or the most applauded. This Budget has been a responsible Budget and has been universally recognised as such. It has also received considerable applause. Australia, like many other Western nations, has been beset by a number of economic ills during the past few years, and these problems had to be tackled by the Government both fairly and firmly.

The Fraser Government has not failed to do just that. When the Whitlam Labor Government took office in 1972 it inherited from the McMahon Government a basically sound economy. Unemployment stood at about 1.4 per cent of the work force, and inflation was about 4.5 per cent. When the Liberal-National Country Party regained office in 1975, after 3 years of Labor rule, unemployment represented over 5 per cent of the work force and inflation was running at 17 per cent. During one quarter it had peaked at an annual rate of 1 9 per cent. Today unemployment still stands at between 5 per cent and 6 per cent of the work force. Inflation, however, has been reduced from 17 per cent under Labor to a figure of approximately 8 per cent under the present Fraser Government. The Fraser Government’s economic policies have been remarkably successful in reducing inflation. It would be unfair to blame all of Australia’s economic ills on the Whitlam Government, although it is true to say that the policies of that Government during its term of office did not help the situation in any way.

When the Whitlam Government came to office in 1972, Labor had been in opposition for many years. It is understandable in the circumstances, that the new Government had many plans and policies which it wished to put into operation. This it did with great gusto. Money seemed to be no object as new scheme succeeded new scheme only to be succeeded by yet another new scheme. The Budget deficit began to grow more rapidly, and continued to grow, as expenditure outstripped revenue. So too did inflation. But surprisingly enough for the Whitlam Government, unemployment began also to increase alarmingly. The Whitlam Government turned to the Keynesian theory of providing increased government expenditure to combat growing unemployment. More and more public money was spent. Yet still unemployment continued to escalate. As a result of these policies so too did inflation, which ran away to the alarming figure of 17 per cent. The Keynesian theory, which had been regarded as a panacea for economic control, was shown to be wanting in the then and indeed present economic situation; that of high unemployment and high inflation. This was the climate in which the Fraser Government took office in 1 975. It was put to the new Government by Treasury and its other economic advisers that the main task facing the new Government was first to contain, and then to reduce, the rate of inflation. One of the first steps to achieving this would be to curtail government expenditure. With a reduction of inflation to reasonable levels, it was argued, business confidence would be restored and as business confidence returned jobs would be created and unemployment ultimately reduced. This policy was accepted by the Fraser Government, and has remained the basis of its economic policy during its four years in office. As a result the deficit, which had been estimated to reach $3.5 billion will, if the Department of the Treasury predictions are correct, be contained to $2. 1 billion in the present financial year.

Even more cause for satisfaction is the reduction in the projected domestic deficit of $1.38 billion to $875m. This Budget outcome has been achieved despite a growth in Budget outlays of 9 per cent. It has been achieved despite the fact that the Government has, under this Budget, restored half yearly indexation of pensions, first introduced by the Fraser Government, I might add, and despite the fact that the 2.5 per cent income tax surcharge will be lifted as from 1 December 1979.-

Admittedly the increased oil royalties received by the Government following the crude oil price increases by the Organisation of Petroleum Exporting Countries, known as OPEC, greatly assisted the Government in not only reducing the deficit, but also enabled the Government to continue its social welfare policies of assisting those most in need. Australia produces 70 per cent of its own crude oil requirements. But if this oil were to be sold at below world parity prices the drain on Australia’s limited supplies would soon become serious. The Government has, in addition, returned to the policy of previous Liberal Governments, taken away during the Labor years, of giving incentives to oil companies for further exploration within Australia. During the Whitlam years exploration within Australia was virtually nil. Australia, with its vast resources of energy components such as coal or uranium, is in a much better situation to face a projected energy crisis than most other Western nations. Solar energy is another source- at present largely unproven- which may well in the future contribute to Australia’s energy reserves. But we are still very vulnerable. During a study tour of the United States of America which I made during the winter recess, I visited the Commonwealth Edison nuclear power station and a nuclear storage depot not far from Chicago. While I was in the United States President Carter made his statement on the energy crisis. In that statement he pointed out that in the future the United States would need to turn more and more to nuclear power. With the United States, the Soviet Union and other nations relying increasingly on nuclear power, we in Australia, who have something like only 20 per cent of the world’s uranium supplies, can have little influence indeed on the world trend towards the use of nuclear energy. At its most recent conference in Adelaide, the Australian Labor Party showed a most unrealistic approach to nuclear power and the mining of Australia’s supply of uranium. It made the unprecedented statement that a Labor Government would not honour any contracts which the present Government has entered into with other countries, despite the stringent safeguards and controls which this Government has imposed.

Mr Hawke, the President of the Australian Council of Trade Unions, stands head and shoulders above the Leader of the Opposition (Mr Hayden) and his Labor Party colleagues in his realistic and pragmatic approach to uranium mining in Australia. At the ACTU congress, Mr Hawke made a strong defence of his belief that Australian uranium should be mined. He said:

For a lot of our friends on the Left, it is ali right to stop the economic development of the west by making uranium and electricity more expensive.

He said that he did not see them doing anything about what was happening in communist countries. If a Liberal or Country Party parliamentarian had used those words he would have been accused of kicking the communist can. Mr Hawke said that he did not see why other countries like South Africa should grow rich from the sale of uranium while Australia turned its back and left uranium in the ground.

Mr West:

– How many jobs are involved?

Mr JARMAN:

– I will come to how many jobs. I am just about to tell you about that, my friend. The result of the elections in South Australia recently was a direct protest by the people of that State against the stand taken by the former Labor Government there in refusing to allow development of three major mining contracts in that State which would have created 7,000 extra jobs within the State of South Australia and would have brought in $4,500m within 5 years. There cannot be and will not be any stop to uranium mining in Australia. The unions involved in the mining of uranium cannot afford to ban it and the men concerned would simply leave their unions if any attempt was made to close down the mines. The policy of the Leader of the Opposition and his left wing union colleagues is completely out of step with community feeling, as the South Australian election showed. Bob Hawke was right to stress the stupidity of bans which do not and cannot ban anythingjust as the original ban on the Newport power station in Victoria showed. The only effect of that ban was to hurt the ALP. The sooner the Labor Party takes the step of bringing Mr Hawke into this Parliament to give some realistic thinking and leadership to the Opposition, the better it will be not only for that party but also for the nation as a whole.

Probably one of the most promising signs which this Budget has produced has been the reaction from the business community in general and the vast upturn which took place in the stock market. National share markets throughout Australia surged forward reaching their highest levels in six years following the Budget of the Treasurer (Mr Howard). Many of the effects of the Budget will not be apparent during the six months to the end of this year. The 2Vi per cent reduction in taxes which does not take effect until 1 December cannot be expected to show any worthwhile improvement in consumer spending in the current half year. Oil price increases yet to flow through to the consumer price index will probably show a full percentage point increase in the CPI; the changes in health charges will undoubtedly cost the December CPI another 1 per cent. Thus for the next five or six months we will probably see the CPI increasing at an annual rate in excess of 1 1 per cent and this will no doubt cause pessimistic commentators, and our Labor Party Opposition, to make grave predictions. However, in the second half of the financial year, we should expect the March and June quarters of the CPI to moderate sharply, giving an overall rate of inflation for the year of a little over 9 per cent. Compared with the situation in other western countries, this is a very good result indeed. One commentator on the Budget has said:

The basic assumption on which the Budget has been framed seems highly realistic and in one important respect, conservative. The assumption on which personal income tax receipts are based is that average weekly earnings will rise by only 9 per cent to 9’/i per cent which no one could suggest was even on the high side.

He continued:

If the Budget strategy is seen to be working in controlling money supply, and the rate of inflation, as the year unfolds, we suggest that the stock market may have continuing good times ahead of it, particularly in the energy sectors.

If business is buoyant in this country, so too will the rate of employment improve. In contrast to the Government’s Budget policies, the response by the Leader of the Opposition was vague and disappointing. One week to the day after the Treasurer introduced the Budget into this House, the Leader of the Opposition rose to reply. He said that a Labor Government would go further into the red. He said that it would increase the deficit; it would put a tax on capital. Government spending would be increased to reduce unemployment and employers would be paid by the Government to put on more staff- paid with taxpayers’ funds. It was like watching a re-run of an old movie.

Mr West:

– It sounds like one, too.

Mr JARMAN:

– It was a return to the old Whitlam policies, the same old story, the same old formula. The honourable member for Cunningham (Mr West) says it sounds like a re-run from an old movie. That is exactly what the speech of the Leader of the Opposition sounded like. I sat in my seat amazed. Had the Labor Party not learnt anything by its past mistakes? Then I recalled that the present Leader of the Opposition had been a senior Minister in the

Whitlam Government and its one-time Treasurer. He had been an architect- along with others of his colleagues- of the Labor Party’s past failed economic policies, and there he was that night trotting out the same old policies and theories once again. It was a replay of the old movie. Australia had experienced to its regret the folly of those policies before. Mr Hayden said that a Labor Government would support tax indexation, yet when tax indexation had been proposed by the Liberal and National parties when the Whitlam Government was in power, he had rejected it. Mr Hayden said that a Labor Government would wipe out tax avoidance. Yet when he had been Treasurer and in a position to do so, he had done nothing about tax avoidance. It was left to the Fraser Government when it came to office to take the first positive action against tax avoidance. When the Leader of the Opposition talks of taking Australia further into the red by increasing the deficit to finance Labor policies, he should remember that Thomas Jefferson said:

The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.

I would also remind the Leader of the Opposition of the words put into the mouth of Mr Micawber by Charles Dickens when Micawber was giving financial advice to the young David Copperfield. Micawber said:

Income 20 shillings, expenditure 19 shillings- result happiness.

Income 20 shillings, expenditure 21 shillings- result misery.

That is the policy of the Hayden Opposition. Probably the main point of resemblance between the Leader of the Opposition and Mr Micawber is that they both believe apparently in waiting for something to turn up. If the Labor Party ever wishes to be accepted by the Australian people as a credible alternative government, it will have to come up with more credible economic policies than those related to taking Australia further into the red. The Whitlam Government proved to our sorrow that no government can spend its way out of unemployment. The Australian people are still suffering dearly for the economic mistakes of the last Labor Government. We cannot afford, as a nation or as a people, to walk down that road again.

Mr John Brown:
PARRAMATTA, NEW SOUTH WALES · ALP

– I would like to refer to the Budget of 1979. The previous speaker, the honourable member for Deakin (Mr Jarman), has regaled us with all sorts of classical allusions which were more relevant to the nineteenth century than to the twentieth century.

Mr Humphreys:

– He is walking out, too. He does not want to listen to you.

Mr John Brown:
PARRAMATTA, NEW SOUTH WALES · ALP

-He is walking out. That is probably reasonable. In referring to the Budget of 1979, I would like to speak in short terms about this present Fraser Government. In the period of the Fraser Government’s rule over this country- a short four years- it has revealed more objectionable features than any of its predecessors in living memory. In four short years it has managed to identify itself with meanness, small mindedness, pettiness and churlish inequality. This is a mean and demeaning change from what the Australian people expected and got under the Whitlam regime, which was a period of at least an attempt at some form of egalitarianism in Australia or an attempt to rectify the great imbalance that existed traditionally in Australia between the ‘haves’ and the ‘have nots’.

I refer the present regime to those of the postwar period. The Curtins and the Chifleys were men of great vision and leadership who commanded the respect of all the Australian community- not just those who supported them in the electoral sense but the total Australian community that supported them in their efforts to pull Australia through the war. They were strong, but they were kind and compassionate people. Even R. G. Menzies of recent memory, whilst he was a patrician, commanding man, also had the respect of the Australian people, whether they supported him or not. I know that his political fortunes fluctuated. There were times when his electoral support was fairly low, but he was always a man who commanded respect. Whitlam was the man who raised the vision of Australia. He raised people’s expectations of what they could get from life. Whilst eventually he perished at the ballot box- that is something to be regretted by people who did not vote for him then but who would like another chance- at least historians will probably regard the period of his rule, from 1972 to 1975, as one of the Camelots of Australian history; as a period when things of an egalitarian nature did happen and when a quality was returned to people so that they could expect that they would get something like a fair share of the cake.

But since the present regime has been in power we have seen a reversion to 20 or 30 years back in the world experience. The National Times described our present Prime Minister (Mr Malcolm

Fraser) a couple of weeks back as the man of the feudal kingdom of Nareen and as a demeaning mean man. I think that that has been reflected in the miserable policies that his Government has introduced in its four years of power. Let me revert to the Budget of 1978. 1 remind the House and anybody who happens to be listening of the things that happened in that Budget. Taxes were put on blind people, on paper boys and on handicapped people. So, we had the ugly situation where two or three hundred people sat in wheel chairs in the rain out in front of Parliament House and demonstrated at the fact that a tax had been put on the meagre amounts that these people were allowed to earn in their sheltered workshops. This has been almost the pattern of existence of this Government. The Budget we are debating now is an extension of that mean spirited, petty attitude towards the Australian people.

The Government is trumpeting loud about its taxation cuts, but fortunately the Australian people realise that the taxation cuts which were promised two years ago but which have just appeared were paid out of the pockets of motorists. The $3.5 billion that has been plucked from the pockets of everybody who buys a tank of petrol in order to drive his car has paid for those tax cuts. But, more importantly, the basic failure of this Budget and of this Government has been the failure to inject into the Australian people any confidence in the future of their country. I know that a lack of confidence is an academic, almost ethereal thing, but it certainly permeates right through the ethos of the Australian people and their thinking, to the extent that people now have lost confidence in their ability to retain their jobs. It is reflected in all sorts of ways, but particularly in the large amounts of money that are deposited in savings banks. The savings banks are awash with money. People are terrified to spend anything for fear that they are going to lose their jobs next week. They are putting money away for the rainy day. I think that the rainy day might turn out to be a flood. That is the fear of the Australian people.

This Government is obsessed with the deficit- as it always has been- and that is one of the reasons that the Australian people have lost confidence in the future of their country. The funny thing is that in two years of the Fraser Government’s rule the deficit that it tells us it has reduced exceeded three years of the much maligned deficits that occurred under the Labor Party. In Australia there is a mistaken belief that low deficits mean a low inflation rate. I would like to speak for a few moments on that myth. The myth that the Budget cut taxes did not last even 24 hours; but the almost equally fallacious assertion that it is anti-inflationary unfortunately is still widely accepted. Over the last five years Australians have been indoctrinated to believe that the Budget deficit is the prime determinant of inflation.

This year’s estimated deficit, if it is like most estimated deficits of recent memory, will be pretty rubbery too. The estimated deficit is $2,193m, which is $l,285m down on the figure for 1978-79. Ipso facto, the gullible have concluded that the Budget is anti-inflationary. A less superficial appraisal would show that the deficit is lower because higher fuel taxes will add an extra billion-odd dollars to revenue, which in turn will add 1.5 per cent directly to the consumer price index by December, and more next year. As that feeds into wages and other producer costs, the direct increase will multiply. In fact, the lower deficit, given its origin, is the cause of higher, not lower, inflation. The Government’s own admission that inflation will rise from 8.2 per cent to above 10 per cent does not deter it from asserting that the Budget is antiinflationary. Will we soon be told that the way to stop inflation is to put prices up? This myth has been repeated by the Press, and it is a myth of which the Australian people should be aware. The myth that a lower deficit means lower inflation is exactly that- a myth.

This lack of confidence is reflected in lots of ways. I mentioned the fact that it is reflected in higher deposits in savings banks. In Sydney in the last few months there has been a fairly frightening episode which is a manifestation of this lack of confidence. It has been reflected in this way: Over the last few years in Sydney there has been a reasonable growth industry in the form of discount stores where ordinary working people can go and buy their durable commodities- their white goods, televisions, fridges, et cetera- at a much lower price than that in the retail stores. People have always been able to use the tax refund that they got at the end of June for that purpose. Recently, three of the leading discount stores in Sydney- Sydney Wide Stores Pty Ltd, Col Buchan Discounts Pty Ltd and Best and Less Pty Ltd- have all passed into receivership of one type or another.

I think that this fairly reflects the lack of confidence which is then reflected in the lack of consumer spending. These stores have not passed into receivership because of bad trading; that is nowhere near the fact. In fact they have always been very good traders. The reason is merely a lack of cash flow in that people are not going out and spending their money. They are banking it because they are terrified of losing their jobs and they are terrified of what the next year will bring. It is interesting to see the Minister for Productivity (Mr Macphee) and the Minister for Business and Consumer Affairs (Mr Fife) in the House. Of all the Ministers I think that probably these two are held in the highest esteem by honourable members on this side of the House. That is because of their ability, which overshadows that of the pygmies with whom they deal. But, then again, I suppose that the old adage holds true, namely, that in the valley of the blind the one-eyed man is king. I suppose that it does not really give them such a great rap to say that they are better than their fellows. Let me refer again to the discount stores and their lack of profitability. The fact that they have gone into receivership is a reflection of lots of things, not the least of which is the Government’s broken tax promises. The people of Australia have been promised tax cuts. These tax cuts have been a long time in coming. They have appeared eventually, at the cost of increased petrol prices. This meant that at the end of June this year people did not get their normal tax cuts and as a result they did not go out and spend.

Also the Government’s policy of confrontation with the unions has produced a continuous strike situation. Only recently we had four very serious strikes in Australia and the Government trumpeted loud and strong to the effect that the working people were bringing down the country with their repeated attempts to go on strike. The simple fact is that in each of those four strikesthe one in the Pilbara, the Telecom strike, the oil strike in Sydney, and the strike in Melbournethe industry concerned eludes me for the moment- the men have gone back to work and the court has made a judgment which has pointed up the fact that the strikes were mainly exacerbated by the attempts of the Government and the employers in every instance to perpetuate the strikes with their confrontation attitude. The simple truth is that these strikes were merely an example of the working people of Australia trying to catch up with the cost of living and make up for the fact that this Government, since it has been in power, has opposed the wage indexation that it claims to support. At every national wage case hearing it has gone before the Conciliation and Arbitration Commission and opposed the attempts of the Australian Council of Trade Unions and individual unions to get wage parity. This has led to the situation where decent and responsible Australian men and women have been forced to go on strike to try to get some sort of wage parity.

This continuing wage strike and the way it has been painted by the slanted Press has led to a lessening of confidence in the Australian people. The Government ‘s apparent unconcern with the unemployment situation and its one-eyed policy of fighting inflation without taking into account world trends adds to this lack of confidence in people’s ability to think that the country will survive. I think that that is the sad part of this Government’s policies. They have led people to think that that is the case. It appears to me that a country as rich as Australia should not be suffering these multiple ills of despair, unemployment and depression. This should be the richest country in the world, given our benefits of stable climate, resources and a democracy that has been stable since Federation, since the start of Australia, largely by the efforts of the working class. With all these things to support us there is no reason why we should have inequality, poverty, depression and despair. I think that supporters of this Government should hang their heads in shame to think that that is the case.

Mr Neil:

– Your Labor Government did it.

Mr JOHN BROWN:
PARRAMATTA, NEW SOUTH WALES · ALP

-As time is running short I will ignore the comments of the angry ant from St George who talks about the Labor Government. It is a pity that his Government does not have the compassion, vision and understanding of the Whitlam Government. It never will have.

I now refer to the overseas borrowings of this Government. When the Labor Government left office in 1975 the national debt stood at approximately $75 per head for every man, woman and child in Australia. Since then this Government has borrowed almost $5,000m from overseas bankers for no other reason than to finance its deficits and prop up the Australian dollar. The average debt per head of population in Australia these days is almost $400. It was $75 in 1 975. It is almost $400 in 1979. Well may Government supporters hang their heads in shame. Of course they should. The Australian people realise that this Government has put them in hock. It has put the Australian economy in hock to overseas borrowings to the extent of almost $5,000m. More significantly, for the first time in recent history our overseas borrowings almost double our overseas reserves. What a nice situation for the Australian people to find themselves in. At the end of four years rule by the people who claim to be the great economic managers this country is in hock.

That is what has happened. That has been the result of four years of their so-called ‘management ‘. The Government has sold out Australia to overseas financiers. This Budget should be the ultimate of the Government’s shame.

The apotheosis of this Government will be that it has left the country bankrupt. I see that the right honourable member for Lowe (Sir William McMahon) has entered the chamber. If only he were still the Treasurer perhaps we would see some improvement. He was desperately bad but he was a lot better than the present one. This Budget is something to be deplored by the Australian people. Please God that in another 15 months there will be a return to the Treasury benches of the real managers of the economy, the Labor Party.

Mr JULL:
Bowman

-No Budget brought down by any government can solve all the economic or socialills of the country. On the other hand, few people will dispute that a Budget can have a significant influence on our standard of living. But long term changes and trends in our society can occur despite Budgets. It is in this context that I believe that the Budget must be viewed as a working agreement between the Australian community and the Government. The social and economic influence of Budgets brought down in these modern times cannot be viewed as having the same impact as those brought down in the 1 950s, the 1 960s or even the early 1970s. Quite simply, there are trends in our community which can be influenced only marginally by the Government’s fiscal and monetary policies. Whilst a government has an obligation to be financially responsible in its administration of the nation, I am also firmly of the view that the community also has a responsibility to ensure that the social sub-structure of the nation is not diametrically opposed to the role of government. When the expectations of the community exceed or challenge the Government’s administration of a nation, not only will our society become stagnant and divided but also as a nation we will lose that capacity to identify and resolve our national, social and economic problems.

I now turn to probably the most important aspect dealt with in this Budget- unemployment and the labour market indicators. It is precisely in this area that I believe that the Government and the community need to co-operate and coordinate their activities if they are to make any real headway. The Budget Papers clearly indicate that productivity increases in business over the last three years have not necessarily been reflected in an expansion of employment. What is evident is that the productivity output per worker, which in some cases has occurred because of more up to date machinery, has increased to the extent that no longer can we necessarily rely on the equation that increased productivity or output equals increased employment opportunities. The consequences of this for employment when the economy regains its feet are not necessarily encouraging. Rather, I think that the facts point out that as a government we need to do substantially more than just repair the economy if we wish to re-establish a new measure of full employment for the nation.

The Budget Papers also state that over the last two years there has been a decline in the labour participation rate- that is, there has been a fall in the number of persons over the age of 15 years who are available for work. Normally, such a trend occurs concurrently with a downturn in economic activity and rising unemployment. However, in this case the decline has emerged some two or three years after the 1974 unemployment boom. No doubt the attraction of high wages has been but one significant factor in encouraging a high participation but we now see that the discouraged worker effect is becoming evident in our labour force. One can only observe that if this trend continues we will face a labour shortage in the mid-1980s. Coupled with our declining birth rate and an imminent shortage of skilled tradesmen, we could, within the period of the next decade, see a complete reversal. Australia could, in fact, face a shortage of skilled tradesmen, resulting in a high labour demand and high costs.

The greatest challenge facing this nation at present is the reduction of our unemployment levels. It certainly follows that one of our priorities must be a rationalisation of our labour market and substantial long term planning in the area of manpower and work force needs. It does not appear to me that we can necessarily expect to sit back and take for granted that the labour market will automatically adjust itself to changing demands. I think that we would be deluded if we expected education institutions to adjust automatically their intakes to take account of employment opportunities for their graduates. We could also be fooling ourselves if we believed that the computer holocaust, as the Australian newspaper entitled it last year, will not have a tremendous social and economic dislocation effect upon this nation. I believe that there are labour trends and changes in our community that throw into question a number of the traditional working mores of our society. We need to recognise this and, as a community, discuss and contemplate means of accommodating these changes in the light of our present employment situation. We should not shirk our community responsibility and say: ‘Let the Government fix it’. Any measures which the Government may contemplate in resolving these dilemmas will need to have not only the acceptance of the community but also a contribution from it. Unemployment is too big a problem for the Government to handle alone.

What then are these trends and changes that are taking place in the work force? Firstly, part time employment continues to grow and the survey based estimate of employment among the part time labour force actually declined over the course of the year. Secondly, female employment was again stronger than male employment. Thirdly, among industry groupings, manufacturing and community services recorded major changes over the year. Fourthly, government employment continued to rise but showed some slackening in the second half of the year while private employment continued to fall. Finally, in marked contrast to earlier years, junior unemployment rates have been rising by relatively less than the adult rates. The Special Youth Employment Training Program seems to have been an important factor in this development. In effect, it has resulted in some substitution of youth employment for employment of other members of the work force.

Debate interrupted.

page 1518

ADJOURNMENT

Trade Unions- Money Supply- Australian Broadcasting Commission: Football- South Australian Elections- Telephone Charges-Radio Australia

Mr DEPUTY SPEAKER (Mr MillarOrder! It being 10.30 p.m., I propose the question:

That the House do now adjourn.

Mr INNES:
Melbourne

– I rise in the adournment debate this evening to raise two matters and to make some protest about the way in which Government members- in particular, Ministers- attack unions in this chamber. They come into this chamber and make most misleading statements. They are a complete fabrication of the situation. They lead people to believe that the activities of organisations such as the Building Workers Industrial Union of Australia and the Australian Telecommunications Employees Association are designed simply to disrupt industries rather than to present legitimate claims on behalf of their members.

This afternoon we heard the Minister for Housing and Construction (Mr Groom) say that there had been an attack on the sub-contracting system by members of the BWIU and other building trade unions. The Minister’s whole speech was a fabrication of the situation. The situation clearly is that the unions themselves are not condemning the sub-contracting system; on the contrary, they are defending the subcontractors in that area for the purpose of maintaining a level that is at least equivalent to the minimum prescribed award rates.

Master builders and building organisations have given evidence to the inquiry that is being conducted in New South Wales. They have attested to the fact that sub-contractors have been forced to sign documentation that, in effect, would place the extent of their capacity to earn the minimum prescribed award rates at risk. In so doing, a situation is being created in the building industry in which the quality of housing construction is being undermined by people being forced into taking contracts that it is very difficult for them to fulfil. The whole basis of the submissions by the builders, the unions and the great majority of contractors has been along those lines. Yet this afternoon the Minister came into this House and lied to the Parliament -

Mr DEPUTY SPEAKER (Mr Millar)Order! The honourable member will withdraw that remark.

Mr INNES:

-I withdraw it. The Minister handled the truth rather carelessly. The whole position is clearly outlined in the material that was placed before the New South Wales inquiry. It seems to me that if Ministers mislead the Parliament in that way, they ought to be held responsible for any industrial disputation that arises out of the statements that they make. The position of the people who act in a responsible way in presenting the arguments of the people who are being exploited by builders and master builders in the sub-contracting field ought to be defended.

Let me turn now to the telecommunications dispute. In that dispute, the public of this country was held to ransom by stand-over tactics of the Government that prevented the Australian Telecommunications Commission from negotiating on a proper and legitimate claim by Telecom employees. At the time the dispute was in its infancy Mr Justice Staples, in criticising both the Government and the Telecommunications Commission, referred the parties to the dispute to a conference in an endeavour to find a way around a legitimate claim. What happened was that this

Government laid down its declaration to the Telecommunications Commission and prevented the Commission from negotiating an agreement. What happened after that? The matter finally went before the Full Bench of the Conciliation and Arbitration Commission, which found that the union had a legitimate claim. The matter has now been referred back to the parties involved to do what they should have done in the first place. Who is responsible for that situation? The people who sit on the other side of this House. Once again the union bashing policies of the Government have led to industrial disputation in order to serve the political aspirations of the Government. They are two examples that ought to be taken on board. As far as we are concerned, if industrial disputation should arise out of the irresponsible statement made this afternoon by the Minister for Housing and Construction the responsibility lies with the Government.

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– I rise in order to deal with an old, worn and grey thesis that is being mentioned continuously that I played a part in raising the money supply and therefore caused the problems of the Whitlam Government in the years 1973 to 1975. I have answered this charge on so many occasions that it has become for me a little boring, but those who would like to see my answer to the Financial Editor of the Age on 19 March 1979 will get the complete answer to that statement. I am sorry that the matter has to be raised by me again tonight.

In that article I point out that throughout 1 972 our worries were about unemployment, inflation and national growth. They continued into 1973. But we had decided to take action late in 1972 in order to ensure that the rate of growth of the money supply was diminished by preventing the inflow into Australia of funds that would be here for a year or less. We had also taken action to ensure that there would be a variable deposit rate if we felt that such action was subsequently needed. The point is that we really believed that unemployment had to be brought under control, knowing of the threat by Messrs Cameron and Crean of the Labor Party that unemployment would rise to 500,000 over the Christmas period of 1972-73. I think that the record was not too bad because even today, as I took out the present Budget and looked at the figures for gross national production, I noticed for the first time that in 1972-73 we achieved a growth rate in real terms of 6.3 per cent.

Dr Klugman:

– That is not true.

Sir William McMahon:
LOWE, NEW SOUTH WALES · LP

– It is set out in this document. The honourable member for Prospect can call those who compile this document liars, and I do not mind if he does. Nonetheless, that is what they have set out. This document says that the growth rate was 6.3 per cent, and I wonder whether the honourable gentleman will say that this is not true. In 1974-75 it was 1.3 per cent, whereas in 1975-76 it was 2.5 per cent. It is now struggling to get up to 2.8 percent.

I mentioned that the Labor Party forecast an unemployment rate of over 500,000. Let us look at the figures. In November the figure was 88,000. Anyone who knows anything about unemployment will know that this was a record. At the end of January the rate was 1 12,000. If we now get a figure of 450,000 at the end of January, we are pretty lucky. So how foolish are those who continue with this argument. I also pointed out in the article that the consumer price index was not 13 per cent as forecast, but 4.6 per cent, and only 2.2 per cent- the going rate- by the implicit price deflator. Interest rates fell to 6.5 percent.

The only argument that can be put up against those performances is that later on the money supply grew. I was sent a table by somebody from the Labor side, a very kind man, which shows that in the second quarter of 1972 the money supply had a growth rate of 9.5 per cent. It was then that we took action. Later it grew and got to a peak of 22 per cent in the fourth quarter. As I have pointed out, by that time we had taken action. If we look at the 1972 Budget we will see that it was a miracle performance. I am glad that I was the Prime Minister at the time. I hope the Speaker is listening because if his ears are not red and ringing, then he is not capable of realising what a wonderful Treasurer he was.

Mr COHEN:
Robertson

-A few weeks ago I was in Melbourne to watch the world fencing championships. At the time a major game of rugby league was being played in Sydney so I rushed back to my Melbourne Hotel to hear the result. I tuned into the sports news on the Australian Broadcasting Commission channel. I waited for 15 minutes. Being a Queenslander, and a follower of the great sport of rugby league Mr Deputy Speaker, you will be surprised to know that no result was given for any of the rugby games, either rugby union or rugby league. I was climbing back on the plane in Melbourne when I happened to bump into the Minister for Post and Telecommunications (Mr Staley). I gently informed him of this oversight by the ABC and said that I thought that the

Government ought to resign on this matter. He kindly wrote me a very nice letter which I shall read into the record. It stated:

I refer to your recent inquiry to me regarding the coverage of Sydney Rugby League results on ABC television in Melbourne.

The ABC have advised me that the lack of results coverage of Sydney Rugby League games by Melbourne stations is due principally to the fact that such games do not evoke any great interest in Victoria. By contrast, however, it is considered that there is reasonable interest in Sydney in the results of VFL games and for that reason such results are always included in sporting reports.

The point I made was that in Sydney a very good coverage of Victorian football league games is given. Those of us from Sydney do not show the prejudice of Victorians in these matters. The letter continued:

The greater interest in VFL in Sydney is also exemplified by the fact that replays of Melbourne matches are presented on Sydney television whereas no replays of Sydney matches are screened in Melbourne.

Anyhow, he graciously stated later on in the letter that the ABC had indicated that it is anticipated that the results of the approaching semifinal series in Sydney rugby league will be covered by Melbourne ABC television. Mr Deputy Speaker, you will be surprised at the number of letters I got from rugby league followers in Victoria congratulating me on the strong stand that I had taken. I point out that many thousands of visitors go to Melbourne and they are very badly treated. It takes five seconds to give the result of the major game in Sydney. This is a matter of serious discrimination.

Mr Neil:

– Shocking.

Mr COHEN:

-At last I find myself in agreement with something said by the honourable member for St George. I have also received a letter from Mr Hamilton, the General Manager of the Victorian Football League in Melbourne. It stated:

We note your comments concerning the lack of Rugby League scores on the ABC in Melbourne in comparison to what you have considered to be a fair go for Australian Rules scores on the ABC in Sydney.

I think it is important to point out that the status -

Honourable members interjecting-

Mr DEPUTY SPEAKER (Mr Millar)Order! I ask honourable members to be silent. The honourable member for Robertson should not have to play against the wind.

Mr COHEN:

-The letter continued:

Of the two sports in each of the two States and I draw your attention to a research survey initially conducted in 1 976 and repeated again this year. in New South Wales Australian Rules football attracts a following of approximately S per cent of the entire population whilst in Victoria Rugby League does not register as a major sport. I think these figures hold the answer as to why the ABC in Melbourne and Sydney have taken the stance that they have, Le. a stance that is relative to the demonstrated degree of public interest.

I am surprised that the General Manager of the VFL should feel so strongly about this matter that he tries to keep the results off the ABC. I was surprised at the spleen and the viciousness of the attack on me for defending rugby league. I suggested that with the Olympic Games coming up and the need for funds for them, we should settle this matter once and for all with a game between the champion football team, St George in Sydney and Carlton or Collingwood. It is quite simple; it used to happen before. We can play one half Australian rules and one half rugby league. We can have a points score system put through the computer to work out a satisfactory score. We can settle the matter once and for all and have a fair go for rugby league.

Honourable members:

Honourable members interjecting

Mr COHEN:

– It is interesting that some of the better honourable members on the other side support me and the worst ones attack me. Some of the honourable members on my side are just as bad as the ones on the other side. Mr Deputy Speaker, I thank you very much for your rapt attention.

Mr CHAPMAN:
Kingston

– Belatedly, tonight, because the opportunity was denied by proceedings in the House last week, I take the opportunity to congratulate my State colleagues in the Liberal Party in South Australia for their devastating and well deserved victory in the State elections last Saturday week. But the people of South Australia and, indeed, Australia, should be warned that the shrewd myth-makers are already at work, trying to lay the foundation for a future Australian Labor Party recovery by offering reasons other than the real ones, for Labor’s thrashing.

Mr Neil:

– Labor liars.

Mr CHAPMAN:

-They are Labor liars indeed. The myth-makers are falsely postulating that Labor’s defeat was a result of angry reaction to an unnecessary early election and hence the consequence of a mere error of political judgment on the part of former Premier Corcoran. Certainly, the early election was detrimental to Labor, but only in a minor way. The AdvertiserSouth Australian Institute of Technology surveys- which accurately predicted the election results, indicated that the early election was a major issue for only 2 per cent of the electors. The myth-makers are secondly postulating that the defeat was due to a sustained anti-Labor campaign by the South Australian business community which was not justified by South Australia ‘s economic circumstances and biased reporting by the Adelaide News. The Leader of the Opposition (Mr Hayden), the honourable member for Port Adelaide (Mr Young), and the honourable member for Bonython (Dr Blewett) have been prominent whingers in this regard. But the very fact that the business community campaigned in a way unprecedented in previous State elections demonstrates the depth of its concern this time about the future of South Australia under a continuation of Labor Party policies. It would have meant bankruptcy for South Australia. Given the extent of government control of business in South Australia, it took great courage for the business community to campaign for South Australia ‘s future in the way that it did. The News in its articles was merely reflecting the depth of concern about the State’s future felt throughout South Australia. I understand that it had great difficulty obtaining alternative newsworthy information from the Labor Party, such was the confusion in Labor’s camp. I particularly take issue with the assertions of the honourable member for Bonython about the News in Adelaide last Thursday week. Some years ago I had the privilege of being one of his politics students at Adelaide University. I say ‘privilege’ advisedly. He was a quite interesting politics lecturer.

Mr Neil:

– Did you write left wing answers?

Mr CHAPMAN:

-Well, some people, I understand, did that. I recall very vividly his assertion in lectures that alleged media bias had no impact on voting behaviour because voters perceived views expressed in newspapers through their own ideological predisposition. Hence if a newspaper expressed a view which accorded with the reader’s own predisposition, that would reinforce that view but if the contrary were the case, it would be perceived as a biased report and be rejected. The honourable member for Bonython in now contradicting himself either lacks credibility as a member of this House or he lacked credibility as a politics lecturer. The fact is that the News was reflecting the deep concern about South Australia’s regional economy felt by a majority of South Australians.

So we come to the real reasons for Labor’s thrashing last Saturday week. That reason is the failure of the Dunstan and Corcoran Governments over the years satisfactorily to manage South Australia’s economy. It is only over the last couple of years that this mismanagement has bitten deeply in South Australia’s regional economy.

Mr Baume:

-They couldn’t take it any longer.

Mr CHAPMAN:

-They certainly could not take it any longer. Before that it was hidden to some extent by the credits built up during the Playford Liberal era. These credits were gradually frittered away by Labor. More and more people became aware of this over a time, climaxing in Saturday’s election result. Linked to this was the growing and valid fear which South Australians had about the activities of left-wing unionists and their trendy friends, both in controlling the Labor Party and in fomenting industrial strife to the community’s detriment.

So let the myths about this election be destroyed and let the realities stand firm. The myths are being created because they provide no long-term reason for people to deny their support for the Labor Party. But the realities do provide a reason. The real issues in the election last Saturday week will remain a continuing product of Labor’s socialist ideology. The people of South Australia, and indeed Australia, should remember that and continue to deny their vote to the Australian Labor Party. In conclusion I especially congratulate the new Premier, David Tonkin, for his electoral breakthrough, achieved last Saturday week, in metropolitan Adelaide. This area was a previous Labor stronghold. It registered a swing of 13 per cent against the Labor Party. Of course, that swing was especially reflected in the State seats which are located within the Federal electorate of Kingston. I congratulate both the previous members who were returned to office and also the two new Liberal members who have been elected to serve the people in the South Australian Parliament.

Mr DEPUTY SPEAKER (Mr MillarOrder! The honourable member’s time has expired.

Mr Keith Johnson:
BURKE, VICTORIA · ALP

– I am sorry that the honourable member for Robertson (Mr Cohen) has left the chamber. He made a provocative speech this evening. If he really wants to go ahead with his invitation, I remind him that our players in Victoria can stand up for 50 minutes until half-time whereas those fellows in New South Wales can last for only 40 minutes and for most of that time they are lying on the ground anyhow. The honourable member was in some doubt last week as to who would be playing in the Grand Final in Sydney. If he has any fortitude at all I advise him to put his money where his mouth is and get every penny he can on Collingwood next Saturday. Even after playing three games in a row the Collingwood players would be quite happy to go to New

South Wales and show the people there how to play football.

I did not interrupt the honourable member for Kingston (Mr Chapman) when he was speaking because in the 10 years I have been a member of this place I have learned that it is very rude to interrupt while a member is making his maiden speech. That is the reason I did not interject during his speech. He perhaps is crowing a little too early in his comments to the House tonight. He would do well to take note of the words of exPremier Dunstan of South Australia on his return from a sojourn overseas when he said that he wept for South Australia as a consequence of the decision taken by the people in that State recently. Those words of course will ring true in the ears of South Australians in the short time that Premier Tonkin and his Government will be in office. Mr Dunstan commented further that the people who constitute the Tonkin Government were not of the nineteenth century but of an era even prior to that. The judgment of a man who is so respected throughout Australia cannot be ignored. That was his comment on his return to Australia. I join with him and I am sure all thinking people in Australia weep for the bad decision that was taken in South Australia that weekend. The South Australian people will come to weep for themselves before very long as the dead hand of the conservatives in that State tightens its grip around the throats of the workers of South Australia.

I wish to raise the matter of telephones and telephone charges in respect of a proposed scheme by Telecom called Access 80. It will provide some benefit to people in fringe areas around the metropolitan area, but it also will create anomalies. One anomaly that has been brought to my attention involves the people in the very fine township of Woodend which was very poorly represented for some years but is now in safe hands. Woodend is about 43 miles from Melbourne. A neighbouring town called Romsey is about the same distance from Melbourne. Under the new scheme the people of Romsey will be able to ring through to Melbourne but the people of Woodend will receive no benefit at all in respect of calls to Melbourne. Curiously enough the people of Woodend will be aligned with Bendigo. I have spoken with the tradespeople in Woodend. They came to me in rather large numbers and pointed out to me a fact that I had already known. There was some difficulty in understanding and explaining the new arrangements. The shopkeepers, the tradespeople and the commercial interests in Woodend are most distressed at the actions of this Government because of telephone chargesthere are also other reasons- and one cannot blame them.

The logical course would be for the Woodend telephone system to be aligned with Melbourne whence the people of Woodend draw all of their supplies and with which they do all their commercial business. The people of Woodend will remain disadvantaged albeit they are the same distance from Melbourne as the neighbouring town of Romsey which will benefit from the new scheme. I trust that the Minister for Post and Telecommunications (Mr Staley) will take some notice of what is being said in this House and will re-assess Access 80 before it is put into operation to make sure that anomalies such as the one that has been brought to my attention are removed and equal benefits applied to those people who live equal distances from Melbourne. It can be clearly shown that the line of communication and the line of business in Woodend are with Melbourne rather than with some satellite city.

Mr DEPUTY SPEAKER:

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

Mr YATES:
Holt

-Faintly over the air this evening there will be the voice of Australia- Radio Australia. This most successful station has had an outstandingly triumphant record over the last few months. I think the House should take note of its success. After all, if we are appealing to the Third World what better medium could we use other than Radio Australia? When the Embassy in Peking opened 250,000 letters were received in a month. That is a staggering number of letters. It means that throughout the Far East, besides listening to the booming voices coming from the United States and the Soviet Union, at last the voice of Australia is being carried to our neighbours and at last what is going on in Australia is clearly of interest to our neighbours. Australia is not only valuable to those who are learning English and want to know about Australia but also it is essential to our foreign missions. It helps to create in the minds of listeners an opinion of Australia. It helps people to understand the Australian way of life. It helps people to understand what we in Australia do.

In fact, Radio Australia is one of Australia’s greatest successes. From Indonesia alone 14,871 letters are received every month. Surely the Government must now respond to the question I raised on 2 1 August in which I called upon the Government to take further steps to make quite sure that the output of our station became a better and more audible signal throughout the entire Far East. Therefore this evening I wish to draw the attention of the House to the work of the Australian Broadcasting Commission in this field and at the same time to suggest that if we are to be a good neighbour in the Far East region it is essential that our neighours understand us and we understand them.

I feel certain that the House will encourage the Government and the ABC to ensure that mail from the listeners sent to the ABC is properly replied to. We should build up not only our radio service but also our letter reply service. It is with great pleasure this evening that I congratulate the ABC and Radio Australia. I look forward to the Government’s taking a much more active part in helping the ABC and Radio Australia if we are faithfully to pursue our interest in the Third World because the Third World is certainly interested in us.

Question resolved in the affirmative.

House adjourned at 10.59 p.m.

page 1524

ANSWERS TO QUESTIONS

The following answers to questions were circulated:

Changes from Visitor to Resident Status (Question No. 2666)

Dr Cass:
MARIBYRNONG, VICTORIA

asked the Minister for Immigration and Ethnic Affairs, upon notice, on 26 October 1978:

How many persons already in Australia were granted a change from visitor to resident status during each of the last three years.

Mr MacKellar:
LP

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

Temporary entrants to Australia of all categories, including visitor, people admitted for periods of temporary residence and illegal entrants, such as ships’ deserters, who were granted change to resident status in each of the last three years totalled:

1975- 76-11,045

1976- 77-11,360

1977- 78-12,000 (estimated)

The 1975-76 and 1976-77 figures reflect the effects of the amnesty offered by the Government to overstayed visitors and other prohibited migrants and of the grant of resident status to evacuees from Timor who were admitted on temporary permits. Note that figures for these years have recently been revised to include some cases not previously recorded in the statistics. The 1977-78 figure, which includes a carry-over of applications from the previous year, is not known precisely due to deficiencies in the statistical reporting system.

Within the above totals, people who came to Australia with visitor visas numbered 8,167 in 1975-76 and 4,440 in 1976-77. The corresponding figure for 1977-78 is not available.

Income Tax: Compensation for Nazi Persecution (Question No. 3143)

Mr Lionel Bowen:

asked the Treasurer, upon notice, on 20 February 1979:

  1. 1 ) Is it a fact that payments made by European Governments (other than the West German Government) to victims of Nazi persecution, for which recompense is made by the West German Government, do not fall within sub-section 23 (kc) of the Income Tax Assessment Act.
  2. Has his attention been drawn to the statement made by Sir Robert Menzies in introducing this provision that the payments have their origin in very unhappy circumstances and the recipients may well be left to enjoy the full amount of the allowances without diminution by taxation.
  3. Is it the intention of the Government to amend subsection 23 (kc) of the Income Tax Assessment Act so that all pensions paid as compensation for Nazi persecution may be exempt from income tax.
Mr Howard:
Treasurer · BENNELONG, NEW SOUTH WALES · LP

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

  1. 1 ) Yes. Exemption under sub-section 23 (kc) applies only to pensions, annuities and allowances paid by a State of the Federal Republic of Germany as compensation to victims of National Socialist persecution.
  2. Yes.
  3. No. The pensions paid by the West German Government have always been exempt from German taxation in the hands of German residents and would have been subject to Australian tax in the hands of Australian residents but for the exemption provided by sub-section 23 (kc). That sub-section was enacted to avoid upsetting a tax-free pension arrangement set up by the paying Government. Unlike the West German pensions, those paid by the Dutch Government are subject to Netherlands taxation when received by Dutch residents. By reason of the Australian-Netherlands Double Taxation Agreement, they are subject to Australian tax when received by Australian residents. It would not be appropriate for these pensions, being subject to Netherlands tax in the hands of Dutch residents, to be exempt from tax when received by Australian residents.

Taxation: On-shore Petroleum Exploration (Question No. 3582)

Mr Hayden:

asked the Treasurer, upon notice, on 28 March 1979:

Can he estimate the reduction in taxation revenue which would have occurred in (a) 1975-76, (b) 1976-77 and (c) 1977-78, had a shareholder rebate scheme applied to onshore petroleum exploration.

Mr Howard:
LP

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

The amount of calls in respect of on-shore petroleum exploration that would have resulted in a reduction in income tax revenue in the years mentioned if a shareholder rebate scheme on the basis proposed in the Budget had applied to on-shore petroleum is not known. However, an indication of the reduction in income tax revenue attributable to such a scheme is given in the attachments to the 1979-80 Budget Speech in which the full-year figures was estimated at $6m. It should be noted that this represents the revenue to be foregone in the first full year of operation of the new arrangements. To the extent that the exploration is successful and results in sufficient income, the consequential reduction in the deductions that would otherwise be obtained by mining companies in respect of exploration and development expenditure would offset the rebate, so that there would be no ultimate revenue cost.

Motor Spirit Prices (Question No. 3669)

Mr Hayden:

asked the Minister for Business and Consumer Affairs, upon notice, on 5 April 1979:

  1. 1 ) Does his Department monitor the retail price of motor spirit sold throughout Australia.
  2. If so, how frequently and how extensively is monitoring carried out.
  3. Does any monitoring include the estimation of the extent of discounting.
  4. What was the (a) extent of discounting, ( b) fraction of motor spirit sales affected and (c) level of discounts available in (i) Brisbane, (ii) Sydney, (iii) Canberra, (iv) Melbourne, (v) Adelaide, (vi) Hobart and (vii) Perth, during (A) December 1978, (B) January 1979 and (C) February 1979.
Mr Fife:
LP

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

  1. No.
  2. , (3) and (4) See ( 1 ) above.

Unemployment Benefits and Family Allowances (Question No. 4005)

Mr Howe:
BATMAN, VICTORIA

asked the Minister representing the Minister for Social Security, upon notice, on 28 May 1979:

  1. What are the current rates of (a) unemployment benefits and (b) family allowances for (i) a single adult and (ii) a married adult with 2 children.
  2. What does a single adult receive by way of unemployment benefits expressed as a percentage of average weekly earnings.
  3. What does a married adult with 2 dependent children receive by way of, (a) unemployment benefits and (b) family allowances expressed as a percentage of average weekly earnings.
  4. Is the Minister able to provide the comparable percentages for single and married adults (2 dependent children) in (a) the United States of America; (b) Canada; (c) Japan; (d) New Zealand; (e) France; (f) Germany; (g) the United Kingdom; (h) Sweden and (j) Austria.
  5. Are Australian levels of benefits lower than for other comparable countries: if so, why.
Mr Hunt:
NCP/NP

-The Minister for Social Security has provided the following answer to the honourable member’s question:

  1. (a) (i) $SI.4S a week, (ii) $103.70 a week (including additional benefit for spouse and children)

    1. (i) Not applicable, (ii) $8.50 a week approximatelythe rate is $36.90 a month)

The total of unemployment benefits and family allowances for a married couple with two dependent children is approximately $ 1 12.20 a week.

  1. Seasonally adjusted average weekly earnings per employed male unit (AWE) for June quarter 1979 (the latest available) are estimated by the Australian Bureau of Statistics to be $231.40. The rate of unemployment benefit payable to a single adult represents 22.2 per cent of this figure.

  2. (a) The rate of unemployment benefit payable to a married adult with a dependent spouse and two dependent children represents 44.8 per cent of seasonally adjusted AWE for the June quarter 1 979.

    1. The rate of family allowances for two dependent children represents approximately 3.7 per cent of the same figure.

The total of unemployment benefits and family allowance for a married couple with two dependent children represents approximately 48.5 per cent of preliminary seasonally adjusted AWE for the June quarter 1979.

  1. and (5) There are serious difficulties in attempting to provide valid and reliable international comparisons of unemployment benefit rates. The International Labour Office has stated (‘Social Security for the Unemployed ‘, 1 976 page 18):

There are probably as many unemployment benefit formulae as there are schemes, and quoting random national examples of them for international comparison would at best be meaningless, if only because their value to the recipients depends on other factors such as benefit duration, the number of waiting days, if any, and the treatment of family allowances, if any, during the benefit period- factors which, like the operation of earning ceilings in contribution and benefit calculation, can influence the actual structure of benefit rates enacted’.

These difficulties are compounded for comparisons between countries with social insurance systems providing partly or wholly earnings-related benefits and Australia’s social security system with its non-contributory flat-rate benefits. In addition to the problems outlined above in determining benefit rates for other countries there are problems because in many cases, there are limits on the duration of benefits paid under social insurance schemes. No such limits apply in Australia. (It is true that unemployed persons who exhaust their entitlements to unemployment benefits under social insurance schemes may be supported by other measures but the value of such assistance is usually below the rates of unemployment insurance benefits.) Also, social insurance schemes may not cover new entrants to the workforce, such as school leavers who have had no opportunity to contribute to such schemes. International comparisons of unemployment benefits as a percentage of average earnings are even less reliable because different countries use different definitions of earnings in their published statistics. The International Labour Office, in its ‘Year Book of Labour Statistics’, brings together earnings figures for a large number of countries but relies on data published by the countries themselves in compiling the information.

The honourable member may, nevertheless, find useful the following table showing for various countries unemployment benefits in 1975 as a percentage of wages lost by a worker who had a wife and two children and received the 1 974 average weekly wage in manufacturing.

With the exception of Australia, the figures have been derived from page 68 of ‘An International Review of Unemployment Insurance Schemes’ by Saul J. Blaustein and Isabel Craig, published in January 1977 by the W. E. Upjohn Institute for Employment Research. The table gives only a broad indication of the comparative relationship between levels of unemployment benefit and wages in the countries concerned and should therefore be taken as no more than a general guide.

The countries compared with Australia in the above table operate social insurance systems of unemployment benefits. One country which has a similar system of unemployment benefits to Australia’s is New Zealand. The following table compares maximum rates of unemployment benefit in the two countries.

Rates of Unemployment Benefit in Australia and New Zealand: June 1979

Office of Local Government (Question No. 4047)

Mr Uren:

asked the Minister for National Development, upon notice, on 30 May 1 979:

  1. Will he supply details of the Local Government Branch functional statement of (a) the previous Department of Environment, Housing and Community Development, (b) his Department and (c) the proposed Office of Local Government.
  2. Will he also supply details of the staffing levels and structure, including the duty statements and classifications of all 2nd and 3rd division officers, for the Local Government Branches of each Department referred to in part ( 1 ).
  3. When was the proposed staff establishment for the Office of Local Government submitted to the Public Service Board and when was Board approval granted for that submission.
  4. What is the current work program of the Local Government Branch of his Department including research projects.
  5. On which interdepartmental committees of the Commonwealth public service is the (a) Local Government Branch of his Department and (b) new Office of Local Government represented.
  6. What standing arrangements exist for liaison between (a) the Local Government Branch of his Department and (b) the new Office of Local Government, and the Australian Council of Local Government Associations, State local government associations and individual councils.
  7. Did he or senior officers of his Department issue a direction to the Local Government Branch of his Department that members of that Branch were not to have substantial communication with individual local government councils.
  8. What powers of examination and review will the Office of Local Government have over the programs of other Commonwealth Departments which either benefit local government or overlap with its activities.
  9. What arrangements have been made for the Office of Local Government to report its activities publicly.
  10. What is the publications program of the Office of Local Government.
Mr Newman:
LP

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

  1. to (4) The Minister assisting the Prime Minister in Federal Affairs announced on 25 May 1979 the proposed establishment of an Office of Local Government within my administration. The Department of National Development forwarded a proposal to the Public Service Board on 31 July seeking approval for the transfer of 12 positions to the Office of Local Government and associated establishment action. The Board’s approval to this proposal was given on 17 August.

The functions of the Office of Local Government as set out in the proposal to the Public Service Board are:

  1. general policy development and advice to the Commonwealth on local government issues

    1. co-ordination of Commonwealth programs
    2. the development, maintenance and dissemination of a comprehensive base of local government statistics; and research
    3. provide a focal point for liaison between the Commonwealth Government and other Governments and agencies on local government issues
    4. provision of Secretariat to Local Government Ministers ‘ Conference and Joint Officers Committee
    5. the administration of management assistance programs, and the promotion of more efficient and effective training and administration in local authorities.
    1. The (a) Local Government Branch of Department of National Development and (b) new Office of Local Government are not represented on any current interdepartmental committees of the Commonwealth public service.
    2. There is both formal and informal communication, as required by circumstances, between the Local Government Branch, the Australian Council of Local Government Associations, State Local Government Associations and State Departments of Local Government. The Local Government Branch and the ACLGA are both represented on the Joint Steering Committee of Officials, which supports the Local Government Ministers’ Conference. These roles will be taken up by the Office of Local Government, and the arrangements will be developed and strengthened as and when there is need to do so.
    3. No. However, for obvious reasons communication will normally be with the ACLGA or the relevant State LGA rather than with the 865 individual councils.
    4. The Office will develop consultation procedures with various Commonwealth Departments for the exchange of information on policy development and program operation affecting local government, and will monitor relevant Commonwealth programs to assess their effects on local government and endeavour to ensure consistency of objectives and procedures.
    5. The activities of the Office of Local Government will be comprehended in the annual report of the Department of National Development, which is tabled in the Parliament.
    6. No formal publications program has been developed.

Crude Oil Production (Question No. 4083)

Mr Hayden:

asked the Minister for National Development, upon notice, on 30 May 1979:

  1. 1 ) What is the total anticipated level of crude oil production in Australia in (a) 1978-79, (b) 1979-80 and (c) 1980-81.
  2. What is the anticipated level of crude oil production in Australia in (a) 1978-79, (b) 1979-80 and (c) 1980-81 priced to the producer at import parity.
Mr Newman:
LP

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

  1. (a) 24,853 megalitres, (b) 25,416 megalitres, (c) 24,309 megalitres.
  2. (a) 6,983 megalitres, (b) 10,851 megalitres, (c) 13,801 megalitres.

Poaching of Giant Clams (Question No. 4104)

Mr Cohen:

asked the Minister for Primary Industry, upon notice, on 3 1 May 1 979:

  1. 1 ) How many foreign fishing vessels have been apprehended and charged with poaching giant clams since 1 970.
  2. What were the names of these vessels and when were they charged.
  3. How many of these incidents resulted in conviction and what were the sentences.
Mr Sinclair:
NCP/NP

– The answers to the honourable member’s questions are as follows:

  1. 1 ) 30 foreign fishing vessels have been apprehended and charged with taking giant clams since 1 970.
  2. The names of apprehended Taiwanese clam vessels and dates masters charged are as follows:
  1. Convictions were recorded in all cases. Sentences were as follows:

Income Tax Paid by Persons of Retirement Age (Question No. 41 10)

Mr Neil:

asked the Treasurer, upon notice, on 31 May 1979:

Do income tax forms call for a person ‘s age to be stated; if so, what statistics are available showing the actual amount of income tax paid by persons of retirement age.

Mr Howard:
LP

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

Individual taxpayers were asked for the first time to state their year of birth on income tax return forms for the 1 977- 78 income year. This information is being sought again in the 1978-79 return forms. Income tax statistics that would indicate the income tax payable by persons of retirement age are, however, not yet available. It is expected that they will be available for inclusion in Taxation Statistics 1978-79, the supplement to the Commissioner’s annual report for 1 978- 79. This will be available for presentation to the Parliament during the 1980-81 Budget Sittings.

Child Removal (Question No. 4213)

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

asked the Minister representing the Attorney-General, upon notice, on 6 June 1979:

  1. 1 ) Has the interdepartmental committee formed to investigate and recommend to the Government legislation or administrative changes needed to reduce the incidence of children being removed from Australia without the knowledge or against the wishes of the other parent concluded its investigations and submitted its recommendations.
  2. ) If so, what are its recommendations.
  3. What action does the Government propose to take pursuant to these recommendations.
  4. In the event that the recommendations are not accepted, what other action does the Government propose to take.
Mr Viner:
Minister for Employment and Youth Affairs · STIRLING, WESTERN AUSTRALIA · LP

– The Attorney-General has provided the following answer to the honourable member’s question:

  1. Yes.
  2. , (3) and (4) The Government has considered the report and recommendations of the interdepartmental committee. Media reports had suggested that hundreds of children may have been removed from Australia by one parent without the consent of the other. The committee’s report indicates that approximately 10 such cases come to the Government’s notice each year. While the number of child removal cases appears not to be as high as media reports had suggested, the Government is concerned to make its legislation and administrative procedures as effective as possible to minimise the problem.

Prevention of child removal is a complex matter involving questions of jurisdiction, dual nationality, citizenship, freedom of travel and rights of the child.

The committee indicated that there is no panacea for the problem. However, the Government is hopeful that the following legislative and administrative actions which are being or will be taken, which arise out of the committee’s recommendations and which have been approved by the Government will both reduce the occurrence of the problem, and assist in the recovery of children that have been successfully removed from Australia:

Revision of sections 62 and 63 of the Migration Act 1958, which provide for offences in respect of the removal and carriage from Australia of children in respect of whom custody or access orders have been made or are being sought, to give them broader application, and relocation of the provisions to the Family Law Act 1975 where their existence should become more generally known;

Improving procedures for the entry of details of some children on warning lists;

Officers of theDepartment of Immigration and Ethnic Affairs and Business and Consumer Affairs stepping up at departure points identification checks of children who are accompanied by only one parent;

Tightening parental consent requirements for the issue of passports to children leaving Australia;

Providing courts and legal practitioners with detailed information on available preventive measures and proposals for new measures in a form which could be distributed to the public;

Approaches to courts to achieve better communication of orders for delivery up of passports by applicants to police and foreign embassies and consulates in Australia;

Requesting foreign diplomatic missions in Australia to decline passport facilities in respect of children who they are informed or who they have reasonable cause to believe are the subject of Australian court orders for delivery up of passports;

Additional and further approaches to other countries, especially New Zealand, to secure arrangements for the reciprocal enforcement of custody orders between Australia and those countries;

Continued participation by Australia in discussions in the Hague Conference on Private International Law on a proposed international convention on the specific problem of child removal;

Authorisation of the Attorney-General to grant financial assistance in deserving cases to assist parents to institute legal proceedings overseas for recovery of their children removed from Australia by the other parent;

Inclusion of the problem on the agenda in future discussions between Australia and New Zealand on travel arrangements between the two countries.

Littoral Search in Western Australia (Question No. 4250)

Mr Dawkins:
FREMANTLE, WESTERN AUSTRALIA

asked the Minister for Transport, upon notice, on 7 June 1 979:

  1. 1 ) Was a contract, or contracts, for littoral search in Western Australia awarded to Transwest Air Charter Pty Ltd.
  2. ) Is this company Australian owned or overseas owned.
  3. 3 ) If the company is overseas owned, is it required to seek or obtain Australian equity; if so, by what date.
  4. Was the award of the contract conditional upon the company successfully meeting these requirements.
  5. Were any other obligations placed on the company; if so, what are they.
  6. What period does the contract, or contracts, cover.
  7. Will the contract be withdrawn if the company fails to comply with any requirements placed on it.
  8. 8 ) Which other operators lodged tenders for the contract, or contracts, awarded to Transwest.
  9. Which of these operators are (a) Australian owned and (b) foreign owned.
Mr Nixon:
LP

– The answer to the honourable member’s question is as follows: (l)Yes.

  1. and (3) See parts (3) and (4) of answer to Question No. 3897.
  2. and (5) No.
  3. The contract is for the period 1 March 1979 to 28 February 1981.
  4. The contract includes normal penalty provisions, including provisions for cancellation, to protect the Commonwealth should the Company default in its contractual obligations.
  5. Other offers for the sectors or parts of sectors comprising the coastline segment included in the contract awarded to Trans- West Air Charter (WA) Pty Ltd were made by the following:

Chartair Pty Ltd

David L. Bidstrup

Geraldton Air Charter Pty Ltd

Quasco Pty Ltd

Paggi’s Aviation

Ord Air Charter Pty Ltd

Oxley Airlines Pty Ltd

Air Care ( R. & G. Senior Pty Ltd )

Allied Aviation Pty Ltd

Antarctic Resources Development Co.

Arnhem Air Charter Pty Ltd

Air Courier

Avon Aviation

Staywood Air

Skycharter Aviation

Mr R. B. Pearce

NavairPty Ltd

Gulf Air

Connair Pty Ltd

Jandakot Flying Services Pty Ltd

John L. Champion

Northern Territory Air Charter Pty Ltd

Murin Association

Executive Airlines Pty Ltd

Phoenix Airways

North East Charter

Jet Charter Airlines

Tropic Air Services Pty Ltd

Mac Air Charter Services

Wesguy Aviation Services Pty Ltd.

  1. I am advised that all are either wholly or predominantly Australian-owned.

Aircraft Accident Compensation (Question No. 4280)

Mr Kerin:

asked the Minister for Transport, upon notice, on 7 June 1979:

  1. 1 ) Does the Warsaw Convention cover passengers flying in Jumbo or wide-bodied jet aircraft.
  2. Is the limit of liability $45,000 per passenger on the death of passengers involved in an aircrash.
  3. Has compensation been paid in full to the families of people killed in the Teneriffe airline disaster.
  4. Is the Commonwealth Government liable on the death of passengers involved in an air disaster where an employee of the Government (e.g. an air traffic controller) is subsequently shown to have made an error in judgment.
  5. Do small aircraft operate or have they operated in close vicinity to large aircraft in the proximity of Sydney Kingsford-Smith Airport in any instance since 1 975.
Mr Nixon:
LP

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

  1. 1 ) Yes, if the country of registration of the aircraft is a Contracting Party to the Warsaw Convention. There are 110 Contracting Parties to the Warsaw Convention out of the 144 Contracting States of the International Civil Aviation Organisation. Of the remaining States some are Contracting Parties to the Hague Protocol which amended the basic liability cover of the Warsaw Convention from US$8,300 ($A7,500) to US$16,600 ($A15,000) for death or injury caused to a passenger.
  2. The figure of$A45,000 is the amount payable under the provision of the Australian Civil Aviation (Carriers Liability) Act. All international airlines on commercial operations to or from Australia have liability cover for death of a passenger of US$58,000 ($A45,000) or such higher sum as is specified in the contract of carriage.
  3. 3 ) I am unaware whether compensation has been paid in respect of all people killed in the Teneriffe airline crash.
  4. Commonwealth employees working on airports, such as air traffic controllers, are responsible for assuring the safe, orderly and expeditious movement of air traffic. Thus, they have a duty to exercise reasonable care, the degree of which may vary according to the dangers which may reasonably be foreseen in any given situation. If failure to exercise this duty of reasonable care causes an accident involving injury to or death of passengers, the Commonwealth may be liable in tort for damages by reason of the Commonwealth assuming the responsibility of operating air traffic control services at airports established and operated by it.
  5. 5 ) Since 1 975 there have been nine occurrences involving less than standard separation between light aircraft and airline aircraft within the Sydney Control Zone.

Veterans’ Affairs: Motor Vehicles (Question No. 4298)

Mr Hayden:

asked the Minister for Veterans’ Affairs, upon notice, on 7 June 1 979:

  1. How many (a) motor cars and station wagons by make and tare, (b) trucks and other commercial vehicles by make and mass and (c) motor cycles by make, are operated by his Department and statutory authorities and business undertakings under his control.
  2. What is the average fuel consumption (kilometres per litre) of each type and make of motor vehicle referred to in part(l).
Mr Adermann:
Minister Assisting the Minister for Primary Industry · FISHER, QUEENSLAND · NCP/NP

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

I refer the honourable member to the Minister for Administrative Services ‘ answer to Question No. 4299.

Productivity: Motor Vehicles (Question No. 4303)

Mr Hayden:

asked the Minister for Productivity, upon notice, on 7 June 1979:

  1. How many (a) motor cars and station wagons by make and tare, (b) trucks and other commercial vehicles by make and mass and (c) motor cycles by make, are operated by his Department and statutory authorities and business undertakings under his control.
  2. What is the average fuel consumption (kilometres per litre) of each type and make of motor vehicle referred to in part(l).
Mr Macphee:
Minister for Productivity · BALACLAVA, VICTORIA · LP

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

I refer the honourable member to the Minister for Administrative Services ‘ answer to House of Representatives Question No. 4299 (Hansard, 11 September 1979, page 972).

Housing and Construction: Motor Vehicles (Question No. 4308)

Mr Hayden:

asked the Minister for Housing and Construction, upon notice, on 7 June 1979:

  1. How many (a) motor cars and station wagons by make and tare, (b) trucks and other commercial vehicles by make and mass and (c) motor cycles by make, are operated by his Department and statutory authorities and business undertakings under his control.
  2. What is the average fuel consumption (kilometres per litre) of each type and make of motor vehicle referred to in part(l).
Mr Groom:
LP

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

I refer the honourable member to the answer provided by the Minister for Administrative Services to Question No. 4299 (Hansard, 1 1 September 1979, pages 972-3).

Ocean Island (Question No. 4386)

Mr Barry Jones:
LALOR, VICTORIA · ALP

asked the Minister for Administrative Services, upon notice, on 2 1 August 1979:

  1. 1 ) Is Australia a member of the British Phosphate Commission; if so, by whom is it represented.
  2. Is it a fact that an offer was made to the Banaban leaders by way of restitution for the loss of, and damage to, their home on Ocean Island.
  3. 3 ) What was the offer and did it include interest.
  4. What attitude did Australia take on whether the interest should be paid to the Banabans.
Mr John McLeay:
BOOTHBY, SOUTH AUSTRALIA · LP

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

  1. 1 ) Australia, as with Britain and New Zealand provides one of the British Phosphate Commissioners, (BPC). Australia’s current representative is Mr M. C. Timbs.
  2. Yes.

  3. Two separate offers have been made to the Banaban community, following proceedings instituted by the Banabans in 1974 in the UK High Court through two actions:

    1. against the BPC (the ‘ Replanting’ case) for damages in respect of alleged failure to replant certain minedover areas on Ocean Island. The Court awarded unspecified damages which were not to be ‘nominal’ nor ‘very large’. In attempting to achieve settlement the BPC offered the Banabans $A1.25m; the Banabans sought $A7m. The Judge then delivered judgment at $A75 an acre amounting to $A 14,000. The BPC renewed their offer of$A1.25m provided no appeal was made against the Court’s decision. This offer was accepted and the moneys have been paid to the Council of Banaban Leaders.
    2. against the British Crown (the ‘Royalties’ case) for damages in respect of alleged insufficient royalties collected for phosphate rock mined on Ocean Island and unjust apportionment of the royalties collected.

The Court rejected these claims in May 1977. However, an ex-gratia offer of $A 10m to a trust fund was then made to the Banaban people by the three partner Governments to assist them in establishing themselves in their new island home of Rabi, in the Fiji group. The offer did not include interest accumulating between the date of presentation and settlement. This offer was also subject to the Banabans agreeing to refrain from further litigation. It is understood that the offer has been orally accepted in principle but a formal settlement is still awaited. The funds are to come from the surplus of the BPC.

  1. The Banabans have sought agreement to the accumulation of interest since the offer was originally made. When a settlement appeared imminent late last year, the three partner Governments agreed to pay interest accumulated on the $Al0m up to 31 December 1978. Advice on formal settlement is awaited before any further consideration will be given to a further extension of interest accumulation.

Ratification of International Conventions (Question No. 4408)

Mr Barry Jones:
LALOR, VICTORIA · ALP

asked the Minister for Foreign Affairs, upon notice, on 22 August 1 979:

  1. 1 ) To which Inter-Governmental Maritime Consultative Organisation conventions, International Labour Organisation maritime conventions and Brussels conventions has Australia become a Contracting State under the present Government.
  2. Which conventions still have to be ratified by Australia.
Mr Peacock:
Minister for Foreign Affairs · KOOYONG, VICTORIA · LP

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

  1. None.
  2. It is the Government’s view that ratification of as many international conventions as possible is a desirable objective. Successive Australian Governments have, however, taken the responsible view that no such convention should be ratified until an exhaustive examination has shown that law and practice in all jurisdictions is completely in accord with the provisions of the convention. To this end, a full range of consultations takes place at up to and including Ministerial level, to ensure that compliance is put beyond doubt before ratification is proposed. The federal system in Australia thus means that progress towards ratification will be slower than in most centrally-governed states.

A complete list of IMCO conventions, indicating those which have been ratified by Australia, can be found in the Department of Transport’s Annual Report, Australian Transport, for 1 977-78. A similar list of the Brussels conventions can be found in that Department’s Report for 1976-77.

There are 23 ILO maritime conventions open to ratification which have not yet been ratified by Australia. These are conventions numbers 23, 53, 55, 56, 58, 68, 69, 70, 71, 73, 74, 91, 92, 108, 1 13, 1 14, 125, 126, 133, 134, 145, 146 and 147. The titles and other details of these conventions can be obtained from the ILO’s latest Chart of Ratifications of International Labour Conventions, a copy of which is held by the Parliamentary Library.

Ratification of International Labour Organisation Conventions (Question No. 4409)

Mr Barry Jones:
LALOR, VICTORIA · ALP

asked the Minister for Foreign Affairs, upon notice, on 22 August 1 979:

  1. 1 ) Which International Labour Organisation conventions has Australia ratified under the present Government.
  2. ) Which International Labour Organisation conventions other than maritime conventions have still to be ratified by Australia.
Mr Peacock:
LP

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

  1. Convention No. 144- Tripartite Consultation (International Labour Standards).
  2. I would refer the honourable member to the answer I have provided to the second pan of his immediately preceding question, as far as the general policy of the Government with regard to ratification of conventions is concerned. There are 72 non-maritime ILO conventions open to ratification which have not been ratified by Australia. These are conventions numbers1, 3, 4, 5, 6, 13, 14, 17, 20, 24, 25, 30, 31, 32, 43, 44, 46, 48, 49, 50, 51, 59, 60, 61, 62, 64, 65, 67, 77, 78, 79, 82, 84, 90, 94, 95, 96, 97, 101, 102, 103, 104, 106, 107, 110, 115, 117, 118, 119, 120, 121, 124, 127, 128, 129, 130, 132, 135, 136, 138, 140, 141, 142, 143, 148, 149, 150, 151, 1 52 and 153. The titles and other details of these conventions can be obtained from the ILO’s latest Chan of Ratifications of International Labour Conventions, a copy of which is held by the Parliamentary Library.

Newspaper Delivery Contract (Question No. 4435)

Mr Jull:

asked the Minister for Transport, upon notice, on 22 August 1979:

  1. Was a contract to deliver Sunday newspapers to Queensland coastal towns recently let to TAA.
  2. If so, has this contract now been sub-let to East West Airlines.
  3. ) What were the terms offered by TAA for the contract, and why was it consequently sub-let to East West Airlines.
  4. Did Ansett Airlines, or any other airline company tender for this contract, and what were the terms of these respective bids.
Mr Nixon:
LP

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

  1. to (4) The Commonwealth Government was not involved in the letting of the contract, and therefore does not have details of the information requested. The matter of course was one for the airlines to decide, having regard to the commercial nature of their operations.

Housing and Construction: Migrant Programs and Policies (Question No. 4444)

Dr Cass:

asked the Minister for Housing and Construction, upon notice, on 22 August 1979:

  1. 1 ) For what programs and policies concerning immigrants has his Department been responsible in each year from 1970 to date.
  2. What was the expenditure on each program and policy.
  3. What proportion of his Department’s administrative expenses are estimated to cover the programs and policies.
  4. On what dates did the transfer of responsibility for programs and policies referred to in part ( 1 ) to or from his Department take effect.
  5. To which or from which Departments were these transfers of responsibilities, made.
  6. Why were these transfers made.
  7. With what other Federal or State Government Departments or authorities does his Department share responsibility for the programs and policies referred to in part (1)
Mr Groom:
LP

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

  1. Since 1970 the Department’s Commonwealth construction responsibilities have included responsibility for some Commonwealth Hostels Ltd capital works, including capital works in migrant hostels.

During the period November 1973 to December 1975 the Minister for Housing and Construction was responsible for (the then) Commonwealth Hostels Ltd- which activities included accommodation services to migrants.

  1. During the period of the Department’s responsibility for Commonwealth Hostels Ltd, the following expenditures were incurred on accommodation services to migrants; the figures appear in Appropriation Acts No. 1 of 1974-75, 1975-76 and 1976-77, and include expenditures incurred by the (overlapping) responsible departments during the 1973-74 and 1 975-76 accounting period:

The following expenditures on capital works directed to the Department and relating to migrant hostels have been incurred by the Department since 1 970:

Randwick Hostel NSW-new ($3.9m)-concluding expenditure 1970-71 $68,000

Springvale Hostel, Victoria- new ($3.5m)- concluding expenditure 1970-71 $872,000 and 197 1-72 $23,000

Wacol Hostel, Queensland-fire protection 1978-79 $50,000

Wacol Hostel, Queensland-sewerage 1978-79 $42,000.

Some relatively minor maintenance expenditures relating to migrant hostel facilities have also been incurred by the Department since 1970. The majority of maintenance of Commonwealth Hostels Ltd assets and some capital works are carried out and funded by Commonwealth Hostels Ltd.

  1. During the aforementioned period of the Minister for Housing and Construction’s responsibility for Commonwealth Hostels Ltd, the proportion of the Department’s administrative expenses to programs and policies concerning immigrants was less than1 percent.
  2. The responsibility for migrant hostels transferred to the Department in November 1973 and from the Department in December 1975.
  3. 5 ) and ( 6 ) The responsibility was passed from the former Department of Labour and National Service in November 1973 and to the Department of Environment, Housing and Community Development in December 1975.

I have no knowledge of the reasons for the transfers.

  1. The Department has no direct responsibility for immigration policies. It continues to undertake design and construction of works required at migrant hostels sponsored by the Department of Administrative Services.

Immigration Entry Cards (Question No. 4472)

Mr Barry Jones:
LALOR, VICTORIA · ALP

asked the Minister for Immigration and Ethnic Affairs, upon notice, on 23 August 1979:

  1. Is it a fact that immigration entry cards state that answers to questions must be given in the English language.
  2. It is also a fact that the questions asked in almost all cases require a specific answer such as name, place of birth, passport number, nationality in which the actual language used for answers is virtually irrelevant.
  3. Do any other countries insist that immigrant entry cards (or their equivalent) be answered in a particular language, i.e. do the French insist that answers be given in French, or the Italians in Italian.
  4. Since Australia is a multi-cultural nation, is the insistence on using the English language only now rather anachronistic, irrelevant and an example of timorous Ockerdom.
  5. Will he give consideration to dropping the requirement that forms be completed in the English language.
Mr MacKellar:
LP

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

  1. Yes.
  2. No. For example one question asks for ‘usual occupation’. Additionally, a deal of information on passenger cards would be unintelligible to user departments if they were completed in native scripts or languages other than English, particularly the former. To emphasise this problem there are over 100 languages used by persons resident in Australia.
  3. No. However, a number of passenger cards in use are printed in the language of the country of origin as well as English where English is not the native language.
  4. No. English is the official language in Australia.
  5. 5 ) No. It would be impractical to do so because of the resources that would be required to provide translations and then the delays consequently incurred in processing data given.

Australia-Japan Relations (Question No. 4496)

Mr Barry Jones:
LALOR, VICTORIA · ALP

asked the Minister for Foreign Affairs, upon notice, on 28 August 1979:

Has his attention been drawn to the Official Report of the Australian Parliamentary Delegation to Japan, July 1978; if so, what action has been taken on each of the Delegation’s 7 recommendations, in particular recommendation 3 to the effect that the Australian Government should inquire whether it would be possible for an exhibition of Jomon and Yayoi pieces from the Tokyo National Museum collection to be brought to Australia for exhibition purposes.

Mr Peacock:
LP

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

My attention has been drawn to the Official Report of the Australian Parliamentary Delegation to Japan, July 1978.I have studied it with interest and would like to compliment members of the Delegation on its wide-ranging and detailed nature. I am informed that no special governmental or parliamentary machinery exists for the handling of recommendations of Delegations such as this. It is usually a matter for individual Delegation members to follow up personally with the appropriate Ministers. The following however is a general response to each of the recommendations, which I hope will be helpful.

  1. Japanese and Asian Language Training

Questions on the Government’s policy towards Japanese and Asian language training in Australia might be more properly directed to my colleague the Minister for Education, although this issue is probably more one for the State Governments. The Delegation’s recommendation concerning the teaching of the Japanese language is also relevant to the work of the Australia-Japan Foundation which was established by the Government in 1976. One of the objectives of the Foundation is to improve the facilities available in Australia for the study of the Japanese language. Towards this end, it has established an intensive Japanese language course, which is conducted annually at the Australian National University.

  1. Australia-Japan Parliamentarian Union

I suggest that the question of the establishment of an Australia-Japan Parliamentarian Union might be taken up with the Parliamentary Presiding Officers.

  1. Japanese Art Exhibitions

No inquiries have yet been made concerning the possibility of arranging an exhibition in Australia of Jomon and Yayoi pieces from the Tokyo National Museum. However, the Australian Gallery Directors’ Council, in association with the Department of Foreign Affairs and the Australia Council, has been very active in arranging for various exhibitions from Japan to visit Australia. Currently touring Australia are The Art of the Japanese Package, and the Sodeisha Group Exhibition (i.e. pottery). In the reverse direction, an exhibition of contemporary Australian jewellery will tour Japan early in 1980.

The Australian Gallery Directors’ Council has almost finalised arrangements for an Australian tour in 198 1 of the Tokugawa Collection. This will be a major exhibition of material rarely viewed outside Japan. It will survey Japanese an in the period spanning the 12th to the 18th centuries and will be in the genre of such other overseas exhibitions to tour Australia as the Archaeological Exhibition in 1977, El Dorado Gold in 1978, Chinese Classical Paintings in 1980 and 5,000 Years of Korean An in 1983.

  1. Air Fares

This recommendation might be more properly directed to my colleague the Minister for Transport. The Government shares the Delegation’s view on the importance of a reduction of air fares between Australia and Japan. This question is at present being actively pursued.

  1. Export of Primary Products to Japan

My colleague, the Minister for Trade and Resources, would be able to provide details of exports of Australian primary products to Japan since the time of the Delegation’s recommendation. I am advised, however, that there are long-standing promotional activities in Japan in respect of Australian primary products, and that every effort is made to take advantage of any new opportunities that arise for increased sales in that country.

  1. The Role of Women in Japanese Society

I am confident that future Australian parliamentary delegations to Japan will heed the Delegation’s recommendation that they should endeavour to find out more about the role of women in Japanese society.

  1. Film and Television Exchange

The Australian Film and Television School has been discussing an exchange of students and staff with Nihon University, Tokyo, since 1 977. The problem of language is considerable but it is hoped that the first exchange of one or two students each way may begin in the 1980-81 financial year. The exchanges will vary in length from three to twelve months.

The Australian Film and Television School has also discussed with the Australia-Japan Foundation the prospects for further exchanges in the film and television fields. The Foundation’s Media Support Program, as well as its program for travel and associated grants, provides opportunities for exchange of personnel in the Australian and Japanese media, including in the film and television industries.

There are also a number of joint ventures in the feature film industry which have reached the scripting stage, but have not yet been finalised.

Migration from Sicily (Question No. 4529)

Mr Barry Jones:
LALOR, VICTORIA · ALP

asked the Minister for Immigration and Ethnic Affairs, upon notice, on 29 August 1979:

What representation does his Department have in:

Palermo, (b) Messina, (c) Catania, or (d) any other city in Sicily.

Mr MacKellar:
LP

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

The Department of Immigration and Ethnic Affairs has one Migration Officer Grade 3 (Clerk Class 7) at Messina as Australia’s sole representative in Sicily. His office is titled Australian Consulate and, in addition to his primary migration role, he is responsible for all Consular functions.

Report on Urban Residential Streets (Question No. 4567)

Mr Burns:
ISAACS, VICTORIA

asked the Minister for Transport, upon notice, on 1 1 September 1979:

  1. 1 ) Did the Annual Report of his Department for 1977-78 state that the report on design and construction standards for urban residential streets requested in 1974 had been completed and would be published shortly.
  2. If so, has the report been published by the Bureau of Transport Economics.
  3. Will he take immediate steps to ensure that this report is released to the public as local government authorities, who are vitally interested in the report, are anxious to examine the findings and act on its recommendations.
Mr Nixon:
LP

– The answer to the honourable member’s question is as follows: (l)-(3) A study of urban residential streets was undertaken by the former Commonwealth Bureau of Roads following a reference from the then Minister for Urban and Regional Development on 23 April 1974. The Director of the Bureau of Transport Economics has advised me that many of the findings of this study have been progressively and widely disseminated. However, the case studies and associated work are now quite dated and the BTE does not consider the cost of bringing the various papers to a standard appropriate for publication to be warranted. Bona fide researchers may have access to the main working papers through the Director, Bureau of Transport Economics.

Disposal of Ships’ Ballast Water (Question No. 4576)

Mr Cohen:

asked the Minister for Transport, upon notice, on 1 1 September 1 979:

Is he able to state what are the regulations presently in force concerning disposal of ships ‘ ballast water into the harbours and coastal waters of (a) Japan, (b) Germany, (c) Canada, (d) the United States of America and (e) the United Kingdom.

Mr Nixon:
LP

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

  1. Japan’s legislation prohibits the discharge of contaminated ballast water in ports and in waters within 10,000 metres of port limits. A very complex system of regulations deals with the discharge of ballast contaminated by oil and other contaminants into coastal waters.
  2. The Federal Republic of Germany has no specific regulations except those internationally in force relating to oil. Individual ports prohibit the discharge of polluted ballast water but provide a collection service.
  3. Canada does not prohibit the discharge of ballast waters, but has regulations prohibiting the discharge of ballast water contaminated by oil and certain chemicals. This discharge prohibition is however restricted to certain specified waters.
  4. The United States allows the discharge of clean ballast water. US regulations are complex but the present prohibition of discharge is restricted to oil contaminated ballast water.
  5. The United Kingdom has no legislation prohibiting or controlling the discharge of ship’s ballast water except for ballast water contaminated by oil.

Social Security: Northland Office (Question No. 4579)

Mr Howe:

asked the Minister representing the Minister for Social Security, upon notice, on 1 1 September 1979:

  1. 1 ) For what period was the Department of Social Security regional office situated at the Northland Shopping Complex, Victoria.
  2. What space was available to the regional office at Northland.
  3. 3 ) Why has the Department closed this regional office.
  4. What new arrangements have been made to service the area since the closure of the Northland Office.
Mr Hunt:
NCP/NP

– The Minister for Social Security has provided the following answer to the honourable member’s question:

  1. 1 ) From 1 3 December 1 97 1 to 3 1 August 1 979.
  2. 330m2.
  3. This regional office has been relocated to office space at Bell and High Streets, Preston, because there was insufficient space available for the establishment of a fully decentralised regional office at the Northland Shopping Complex.
  4. The majority of clients from the office that operated from the Northland Shopping Complex will continue to receive Social Security services from the relocated Preston Office. The balance of clients are being catered for by the regional offices at Greensborough (which has been expanded ) and Heidelberg.

Repatriation: Dependant’s Allowance (Question No. 4598)

Mr Clyde Cameron:
HINDMARSH, SOUTH AUSTRALIA · ALP

asked the Minister for Veterans’ Affairs, upon notice, on 12 September 1979:

  1. 1 ) What is the current dependant’s allowance in respect of the (a) spouse and ( b) child of a war pensioner.
  2. 2 ) When was the allowance fixed at its present rate.
  3. Have these allowances been increased in the 1979-80 Budget; if not, why not.
Mr Adermann:
NCP/NP

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

  1. 1 ) The maximum rates are currently (a) $4.05 per week and (b) $1.38 per week.
  2. The dependant’s pension for wives was last increased in 1 964 and for children in 1 952.
  3. No. Dependants’ allowances have not been increased for some time because successive Governments have preferred to concentrate available finance on maximising benefits to veterans themselves or the dependants of deceased veterans. In this way, the family as a unit receives the benefit of increased pensions and allowances and the primary purpose of Repatriation pensions as compensation for disabilities related to service is achieved.

Namibia (Question No. 4599)

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

asked the Minister for Defence, upon notice, on 12 September 1979:

What developments have taken place since 20 February 1979 regarding the Government’s intentions to send an Army unit of 300 men to the United Nations Peacekeeping Force in Namibia.

Mr Killen:
LP

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

  1. 1 ) On 20 February the Government announced that it was willing to send an Army engineers unit to Namibia as a contribution to the United Nations Transitional Assistance Group ( UNTAG) proposed for that country.
  2. The UN has not yet issued a formal request for Australian or any other contributions. This is because South Africa has yet to accept the plan sponsored by the Western Five (Canada, France, Germany, UK and US) for a Namibian independence settlement under UN auspices. Discussions between the parties concerned are still continuing following the recent visit to South Africa by the special envoy for the Five, Sir James Murray.
  3. For a more detailed exposition of the principal obstacles to agreement I refer the honourable member to the reply given in another place by my colleague, the Minister representing the Minister for Foreign Affairs in the Senate, to a question without notice on 2 1 August 1 979.

Code of Practice on Radiation (Question No. 4601)

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

asked the Minister for Health, upon notice, on 12 September 1979:

Has he investigated claims that an Aboriginal Liaison Officer and his family were exposed to radiation in excess of internationally acceptable limits and in excess of the maximum whole body dose permitted to a member of the public under his Department ‘s Code of Practice on Radiation.

Mr Hunt:
NCP/NP

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

I am aware of the claim that an Aboriginal Liaison Officer and his family may have been exposed to radiation at Nabarlek in the Northern Territory. I understand that the claim was originally made to a member of the staff of the Office of the Supervising Scientist. The Supervising Scientist very properly referred the report to the Northern Territory Department of Mines and Energy, which is the supervising authority responsible for the regulation of all uranium mining activity in the Northern Territory.

Code of Practice on Radiation (Question No. 4602)

Mr Les Johnson:
HUGHES, NEW SOUTH WALES · ALP

asked the Minister for Health, upon notice, on 12 September 1979:

  1. 1 ) How many investigations in each year since 1972 were carried out by his Department to determine whether there were specific breaches of the maximum radiation dose permitted to a member of the public under his Department’s Code of Practice on Radiation.
  2. In how many cases was the permissible level exceeded.
  3. 3 ) What were the causes of the breaches.
  4. Where did the breaches take place.
Mr Hunt:
NCP/NP

– The answer to the honourable member’s question is as follows: (1), (2), (3) and (4) The only uranium mining carried out in Australia since 1972 has been in Queensland and that State’s authorities are responsible for the regulation of all aspects of the uranium mining there.

My Department’s Australian Radiation Laboratory (ARL) has, of course, been available for consultation on any radiation matters but, although claims, as yet unsubstantiated, have been made, ARL knows of no specific breaches of the maximum radiation dose permitted to a member of the public under the Code of Practice on Radiation Protection in the Mining and Millingof Radioactive Ores.

Immigration and Ethnic Affairs: Filling of Vacancies (Question No. 4608)

Mr Howe:

asked the Minister for Immigration and Ethnic Affairs, upon notice, on 13 September 1979:

  1. 1 ) Did his Department advertise 43 positions (as recommended by the Galbally Report, ‘Migrant Services and Programmes’) in December 1978.
  2. If so, is it a fact that none of the advertised positions in Victoria have yet been filled.
  3. How long will it be before the positions are filled.
  4. What are the reasons for delay.
Mr MacKellar:
LP

– The answer to the honourable member’s question is as follows: ( 1 ), (2), (3) and (4) Following advertisements for various migrant settlement and ethnic affairs officer positions, over 2,000 applications were received. It has been a lengthy task to produce short lists for interview and to conduct interviews in order to give all applicants for positions in all States and the Northern Territory the opportunity to demonstrate their abilities and capacities. The positions are now being filled and the first of the persons appointed are now taking up duty. The positions in Victoria will be filled in the very near future.

Lead in Petrol (Question No. 4621)

Mr Hayden:

asked the Minister for Health, upon notice, on 13 September 1979:

  1. 1 ) Has his attention been drawn to the report of the study Lead Burden of Sydney Schoolchildren’ (January 1979) by V. P. Garnys, R. Freeman and L. E. Smythe.
  2. If so, was his attention drawn to the findings and recommendations of the report, particularly those which related to automotive exhaust and levels of lead.
  3. In view of the findings of this study on the adverse effects of lead in petrol on the health of schoolchildren, what action has he taken or will he take to ensure the implementation of each of these recommendations.
Mr Hunt:
NCP/NP

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

  1. 1 ) and (2) This report, which was financed in part by the National Health and Medical Research Council (NH and MRC) has been drawn to my attention and has also been studied by my Department. (3)I have asked the NH and MRC to examine these problems urgently. Because of the complex nature of the subject this examination requires some time, and advice and recommendations from Council are not expected before October. On receipt of this advice I will be in a better position to indicate desirable goals and appropriate guidelines designed to ensure the maintenance of proper health standards and to protect Australians from the adverse effects detailed in the report.

Cite as: Australia, House of Representatives, Debates, 25 September 1979, viewed 22 October 2017, <http://historichansard.net/hofreps/1979/19790925_reps_31_hor115/>.

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