18th Parliament · 1st Session
Pharmaceutical Benefits 2943
Wednesday, 28 May
ThePresident (Senator the Hon. Gordon Brown) took the chair at 3 p.m., and read prayers.
– I ask the Minister for Social Services whether it is a fact that, under the Government’s pharmaceutical benefits scheme, the friendly societies’ dispensaries have the right to trade with the general public. Has the Minister received representations from the retail traders’ associations protesting at the granting of this right to the friendly societies’ dispensaries? Will the Minister advise the Senate as to the present position and the steps that will be taken to protect the livelihood of these small storekeepers, chemists and others affected?
– At present there is no valid act relating to pharmaceutical benefits, but the Government has announced its intention of re-enacting that legislation in the near future. I have received representations from many bodies, and I have had regard to those representations in making recommendations to the Government. The Government recently gave consideration to the pharmaceutical benefits scheme, and as this matter will come before the Senate soon, I am not in a position to make any announcement regarding what is proposed. The position of small shopkeepers and others who might be affected by the legislation has been taken into considers- . tion.
– On the 21st May, Senator Fraser asked whether I would furnish a list of newspapers which had not drawn their full quota of newsprint, and the extent to which they had failed to do so. .
Inquiries which I have made have disclosed that to date no’ newspaper proprietor has not drawn his full quota of newsprint. However, the specifications for the second half of 1947 are not due until the 31st July, and if it then be found that any newspaper proprietor does not specify for his full quota, the unwanted tonnage will revert to the pool and will be available for re-allocation.
– Adverting to the question which I asked last week, is the Minister for Trade and Customs able to inform me of newspapers which have not used their full quota of newsprint?
– I shall endeavour to obtain that information as soon as possible.
Ban on Dutch Ships.
From yesterday’s press we have learned that the Indonesian Government has now granted permission to our waterside workers to load ships destined for the Dutch East Indies. I ask the Minister for Supply and Shipping whether there is any arrangement, or agreement, between theCommonwealth Government and the Indonesian Government which allows the latter to havecontrol over a section of Australian citizens? Can any foreign nation now dictate the destination of our trade and commerce? Is ‘control over our tradeand commerce permanently or only temporarily transferred from the Commonwealth Government to union officials?
– I have not read the statement mentioned by the honorable senator, “but I remind him of the fact that, a few months ago, the people of Australia determined that shipping and other matters ofconcern to them were safe in the hands of the present Government. Agreement has not yet been reached between the Indonesian people and the Netherlands Government regardingthe transport of cargoes from Australia to the Netherlands East Indies. Until such an agreement is reached, the matter is not of much concern to the Commonwealth Government.
– On the 14th
May, Senator Large asked a question concerning the granting of licences for the importation of smoking pipes from Great Britain and France.
I have had inquiries made, and I now inform the honorable senator that licences are not required for the. importation of smoking pipes of United Kingdom origin. During the fiscal year 1938-39, which is the base year for import licensing, smoking pipes to the value of £18,517 were imported from France and other foreign countries. Import licences’ for smoking pipes of French origin are being limited to the equivalent in value of the imports during the base year.
– On the 2lst May, Senator Aylett asked a question concerning provision for the admission, at concessional rates of duty, of motor trucks and chassis imported by local government bodies and public utilities.
I now confirm that there is no such provision.
– On the 23rd May, Senator Allan MacDonald asked a question concerning the amount of cargo awaiting shipment to Western Australia.
I am now able to supply the following figures for the information of the honorable senator : -
Vessels under the control of the Australian Shipping Board have recently discharged cargoes at Esperanee and Albany and there are no other important accumulations of cargo in easternStatesforWesternAustralia. TheAustralian Shipping Board will allot further vessels for the Western Australian service at opportunity to do so occurs.
– Does not the Minister for Supply and Shipping con- sider thatitis criminalneglect to allow ships withrefrigerated space to depart from Australian ports without utilizing that space for the transport of food? Is it not a fact that this has happened on a number of occasions?
– I do not know to what the Leader of the Opposition (Senator McLeay)is referring; but I assume he has in mind some alleged disorganization caused by industrial disputation, becausehe rarely asks a question in regard to such matterswithout reflecting upon the workers of this country. However, I assure him that the departure of vessels without food is not in any way connected with any industrial dispute. Whilst it is tobe regrettedthat vessels with refrigerated space do not always carry away shipments of food, the fact remains that it often occurs, and I refer the Leader of the Opposition to the recent dislocation brought about by the refusal of graziers to send stock to the markets. Probably the reason for the non-utilization of refrigerated space in ships is that graziers have not played their part in providing meat for export.
– In view of the repeated representations made by honorable senatorson both sides of the chamber that more shipping space be made available for the transport of materials urgently required in Western Australia, I ask the Minister for Supply and Shipping whether the statement attributed in press reports to an honorary Minister in the “Western Australian Government on her return to Western Australia that her representations in this matter had accomplished greater results than those of members of the Parliament is correct? If so. was her success in comparison with the efforts of honorable members and honorable senators due to female influence?
– I have not read the press reports to which the honorable senator refers. The State honorary Minister mentioned submitted to me a long list of goods which she requested be made available to Western Australia. As most of those items are being handled by the Minister for Works and Housing, I referred the list to him.I am not aware of the degree of success achieved in that quarter. However., I can assure honorable senators that it has not been possible to make available any additional shipping space for the transport of materials to Western Australia as the result of the visit toCanberra of that honorary Minister.
asked the Minister for Munitions, upon notice -
– The answers to the honorable senator’s questions are as follows : -
Refugees in Australia - SS. “ Misr “.
– In reply to a question asked by Senator Collett on the 22nd May, the Minister for Immigration has supplied the following information, which, with the leave of the Senate, I shall incorporate in Hansard -
Attached is a statement giving the numbers of alien migrants who landed in Australia fromMisr, their nationalities and the States to which they were proceeding. More than 90 per cent. of these migrants were comingto join relatives domiciled in Australia who had guaranteed the maintenance of their nominees.
The Department of Immigration has no control over the allocation of berths on foreign ships proceeding to Australia and it is left to alien migrants to make their own arrangements in regard to transport to this country. The department gave no assistance in this regardto aliens who travelled byMisr.
I have read comments which appeared in the Western Australian press regarding the alien passengers on board. In order to test theaccuracy of these newspaper reports, and partly for immigration purposes,I arranged for two reliable officers of my department who had a wide experience of alien migrants to travel on the vessel from Fremantle to Melbourne. Both officers were satisfied that the migrants were not undesirable types and would be readily assimilated and prove good citizens. One officer in his report states, “ I categorically state that thepress reports criticizingthemigrant passengers are grossly misleading, unfair and entirely unwarranted.”
It is the Government’s desire that as many British migrants as possible should be settled in Australia in the shortest possible time.
To that end I suggested that Fremantle should be made the terminal port for vessels carrying British migrants and that those destined for other States should travel to their destination by coastal vessels, train or even by air. The adoption of such a plan would accelerate the flow of British migrants to this country but the suggestion was not intended to apply to vessels transporting foreign migrants.
The proposal to make Fremantle a terminal port for migrants for all States is only in the exploratory stage, but I may say that likely sites for transit camps examined for the purpose were inspected by me in the company of the Under Secretary of the Western Australian State Department of Lands and Immigration. Further, this proposal was discussed in Perth by the permanent head of my department with the State Minister for Immigration and the Under Secretary of that department.
The Government’s immigration policy is known to all State governments. Conferences on the departmental, ministerial and Premiers level have been held between the Commonwealth and States and the Commonwealth and States are working in close collaboration to implement the policy decided upon. At those conferences the State governments, including the Government of the State of Western Australia, have agreed to be responsible for the reception, placement and after-care of migrants. For such purposes it will be necessary to establish reception centres at the port of disembarkation in each State and Western Australia is now proceeding with the establishment of its reception depot for migrants destined for settlement in that State. The cost of this depot will be borne jointly by the State and Commonwealth Governments
Decline in Birth-rate.
– Following on a recent statement by the Minister for Immigration, drawing attention to the alarming decline of the birth-rate and the great increase of old-age pensioners, can the Minister for Social Services inform me whether the Government has any proposals to meet this development? Does the Government propose to give further consideration to the payment of child endowment for the first child of a family up to the age of sixteen years?
– The Government realizes that there is a regrettable decline of the birth-rate of this country and that, although there has been an improvement in the last few years, the drift is serious. The Government proposes to stimulate immigration to increase population, and when it is able to develop its national medical service to the maximum extent it will concentrate on maternal welfare, which should result in a further stimulus to the birth-rate. “With regard to the second question asked by the Leader of the Opposition, the answer is “No”. The reasons for the Government’s refusal to grant child endowment in respect of the first child have been elaborated on several occasions.
– Can the Minister representing the Treasurer inform me whether there are any statistics available to show the number of taxpayers in this country who are in receipt of incomes exceeding £1,500 a year, and whether such statistics show their occupations?
– I am not aware whether such statistics are available, but I shall have inquiries made in an endeavour to supply that information.
– On the 22nd May, Senator Aylett asked me the following question, without notice: -
Can the Postmaster-General say whether bis department is experiencing difficulty in obtaining staff for telephone exchange work! What is the weekly wage paid to telephonists and how does it compare with the wages paid to women in other industries who have the ability to act as telephonists? Further, can he say how the amenities provided and the conditions of employment in telephone exchanges compare with those enjoyed by women in other industries ?
The answer to the honorable senator’s question is as follows: -
During recent years the department has experienced difficulty in recruiting telephone operating staff at some centres. The weekly rates of pay of telephonists are as follows: -
These rates, which have been fixed by the Public Service Arbitrator, are being reviewed at present by the Public Service Board and the department in order to see whether there is justification for approaching the arbitrator for a variation of the award. It is not practicable to make a comparison between the wages paid to telephonists in the department a nd those paid to women employees in other industries who have the ability for telephone operating duties. Appointment to the permanent staff as telephonist is obtained by passing an education examination of an elementary standard. The successful candidates may, however, possess educational qualifications greater than the minimum required to pass the examination and which would no doubt have a material bearing on the class of work for which they would be suitable if employed in outside industry. it is the policy of the department to provide staff amenities in accordance with standards approved for the Commonwealth Public Service as a whole. These standards compare favorably with those obtaining in industry generally. The department is aware that at some centres the existing amenities are below the approved standards, but is taking steps to effect substantial improvements as part of its rehabilitation programme.
The general conditions of employment of telephone operating staffs in the department are those prescribed by the determination of the Public Service Arbitrator, and the Commonwealth Public Service Act and regulations for the Commonwealth Public Service. As a general rule, they are more favorable than the conditions of employment applicable to women in outside industry.
– I ask the Minis ter for Supply and Shipping whether it is a fact that the Government has now handed back the Coalcliff Colliery to its owners? Did the loss incurred under government control amount to approximately £100,000? In addition, has the
Government undertaken to pay compensation to the owners amounting to £85,000? If these figures are not correct, will the Minister supply the correct figures, in order that the taxpayers may know how good a business deal the Government made in this matter ?
– It is a fact that a loss was incurred while the Coalcliff Colliery, was being operated, first, by the Coal Commission, and, later, by the Joint Coal Board. However, thatloss was accounted for by reason of experiments in respect of the eradication of dust in mines generally by the water immersion method and various other methods. Those experiments were costly, but if they prove to be the means of saving the life of only one miner, and help to stabilize the coal-mining industry by inducing miners to return to it, the expenditure of £100,000 in this matter will have been well justified. I am not aware of the amount of compensation that will be paid to the owners, but I shall supply that figure later to the Leader of the Opposition.
asked the Minister representing the Treasurer, upon notice -
– The Treasurer has supplied the following answers: -
asked the Minister representing the Minister for Commerce and. Agriculture, upon notice -
– The Minister for Commerce and’ Agriculture has supplied the following answers : -
asked the Minister representing the Treasurer, upon notice -
– The information is being obtained and a reply will be furnished as soon as possible.
asked the Minister for Trade and Customs, upon notice -
– The answersto the honorable senator’s questions are as follows : -
Transfer of Hospital Patients - Wab Pensions
asked the Minister representing the Minister for Repatriation, upon notice -
– The Minister for Repatriation has supplied the following answers: -
asked the Minister representing the Minister for Repatriation, upon notice’ -
– The Minis!:..-: for Repatriation has supplied the follow ing answers : -
Debate resumed from the 23rd Mav (vide page 2S46), on motion by Senator Ashley -
That the bill be .now rend a second time.
– I am pleased to note that tinbill provides some tangible assistance fo.’ primary producers, particularly in regard to soil erosion. Deductible expenditure is to include the cost of protecting thibanks of waterways, planting windbreaks terracing, the prevention of gullying, and expenses of a like nature. Over the years, we have heard quite a lot about thiravages of soil erosion in this country. It is a matter of great public interest. In fact, it is what might be termed a great national problem.. Whilst there if a certain amount of activity on the pan of State- governments- and others to counter this scourge that, is wasting thegreat asset of our fertile, lands;, it L= pleasing to note that, by this measure, the Commonwealth Government is doing something practical to assist primary producers in that direction. The bill provides also that the money expended in the construction of dams, earth tanks, bores, wells, underground- tanks, leverbanks, irrigation channels, and other similar structural improvements shall bt deductible for income tax purposes. In the drier portions in this continent the- need for water conservation is great. 3 am not referring to the far inland area* where there are no centres of population, but, rather to more settled areas of semiarid land in quite a number of State? where water conservation presents a great problem, not only to State governments. but also to local-governing authorities. The former Minister for Public Works in Western Australia, Mr. Hawke, initiated a proposal for a £10,000,000 loan i.o Western Australia for water conservation in the southern areas. The Labour administration of which he was a member and which held office in Western Australia until recently, was greatly concerned with the problem of water conservation. A previous Labour administration had undertaken the construction of the Canning dam during the depression years, and the boon that that great reservoir has been to the State since its completion is ample evidence of the desirability of great public works projects. At present the capacity of the Mundaring dam in Western Australia is being increased, showing that water conservation, like soil erosion, is regarded as a problem of considerable magnitude in that State, [t is gratifying, therefore, that the Commonwealth Government, too, is doing something practical in that direction.
I welcome the Government’s decision to increase the taxation concession applicable in parts of the Commonwealth coming within what is known as “ Zone A “, from £40 to £120. This zone includes the northern portion of Western Australia. Wo have heard a lot about the pioneers of Australia, and I contend that the people residing in the northern portions of this continent, particularly in the north-western area, are truly pioneers. They have undertaken valuable developmental work in an area the vast mineral resources of which are as yet untapped or even unlocated.
I come now to what I regard as an anomaly in the incidence of taxation. I have had brought to my notice the case of a widow of pensionable age, who owns her own home, and in addition, two or three other small properties that give her a total- income of approximately £140 a year. The home that she owns and in which she lives would not be a bar to her receiving a pension, but she is deprived of this benefit, and of other social service benefits, because of the £140 per annum that she obtains from her properties, yet out of that income she has to pay income tax, a social services contribution, rates and taxes and maintenance costs on her properties. These charges are a severe drain upon her income. Under the con- solidating social services legislation with which we dealt recently, old-age pensioners will, from the 1st July next,, receive 37s. 6d. a week. The woman will have only 9s. 6d. a week more on which to live and to meet all the liabilities to which I have referred. I suggest that the Treasurer (Mr. Chifley) should give consideration to providing a special exemption to taxpayers in this category. This possibly can be done by increasing the exemption limit. I realize the difficulties that would be presented to the Treasurer in implementing my suggestion. It would be necessary to differentiate between cases of nominal income such as I have mentioned and cases in which persons of pensionable age receive considerable income as the result of ownership of p large number of properties. However, we must endeavour not to penalize thrift. As other honorable senators have pointed out, the birth-rate in Australia is at an alarmingly low level, and the proportion of citizens of pensionable age is continually increasing. I hope that the Treasurer will give earnest consideration to my proposals, perhaps not at present, but nt a later stage.
– in reply - This bill appears to have the support of not only the Leader of the Opposition (Senator McLeay) and the Deputy Leader of the Opposition (Senator Cooper), but also every other honorable senator. The reason for this is obvious. It is the substantial benefit that will be conferred upon taxpayers generally and upon industry by the measure. Since the cessation of hostilities, there have been three successive income tax reductions, involving a total of approximately £71,500,000 a year. The first reduction of 12£ per cent., which operated from the 1st January, 1946, accounted for £20,000,000 a year; the second reduction, which operated from the 1st July, 194:6, accounted for £17,500,000; the third reduction, which will operate from the 1st July, 1947, will account for £34,000,000 a year, making a total reduction of £71,500,000. Included in these remissions will be the effect of increased concessions for dependants. The family man will be particularly well cared for.
For example, the allowance made for a dependent wife will be increased from £100 to £150, and that for the first child of a family will be increased from £75 to £100. The cumulative effect of the reduced rates of tax and the increased allowances for dependants will cause reductions ranging from 100 per cent, on certain low incomes to 10 per cent, on high incomes. In future, neither social services contributions nor income tax will oe payable by a taxpayer having a dependent wife and receiving £200 a year or less. The total levy of tax and social service contributions upon a majority of taxpayers will he less than 50 per cent, of the annual wartime total.
The Leader of the Opposition complained that the leaders of the Labour party during the last elections virtually described the Leader of the Opposition ing the House of Representatives (Mr. Menzies) as a criminal, because of the tax reductions which he proposed. All honorable senators will agree that exaggerated and extravagant statements are made by members of all parties during election campaigns.
– The Prime Minister made one.
– So did Mr. Menzies, and he was outdistanced by the Leader of the Australian Country party (Mr. Fadden). I played a considerable part in the election campaign in almost every State, but I have no knowledge of Mr. Menzies or Mr. Fadden being referred to as a criminal. The people were not greatly impressed with the promise of a tax reduction of £25,000,000 made by Mr. Menzies. However, the leaders of the Labour party, their supporters, and the people of Australia were greatly concerned about the method of financing the proposed reduction. The concessions and bribes offered to the people by the Opposition parties amounted to many millions of pounds. For instance, the abolition of the means test alone would have cost £46,000,000 a year. The provision of endowment for the first child in each family would have cost approximately £20,000,000 a year. These two items, added to the annual cost of social services, would have made a total of £66,000,000 a year. Mr. Menzies and his supporters gave very little indication of the means by which they proposed to obtain this huge sum. Mr. Menzies proposed to finance social services on a contributory basis.
This would have had a most unfair effect upon people earning £400 a year and less, about whom the Leader of the Opposition professed to be so greatly concerned. I point out to him that 1,500,000 taxpayers in Australia earn £400 a year or less. Under the scheme of reductions proposed by Mr. Menzies,, that group would have received a benefit of £6,000,000 a year. This would have represented a reduction of approximately ls. 6d. a week each. I also point out to the honorable gentleman that under the Menzies scheme, persons in receipt of £1,000 a year or more would have benefited by £11,000,000 a year. There are S5,000 persons in that group. In other words, under that plan, the small group of high income earners would have benefited by almost twice the amount proposed for the large group of low income earners. That was not the only injustice contained in those proposals.
– What are the relative gross earnings of those two groups?
– I am not able to state them at the moment.
– They are of some importance.
– I am dealing with the individual benefits that would have accrued to 85,000 high income earners and to 1,500,000 low income earners. The larger group is composed of the real toilers and wealth-producers of the nation. Members of the Labour party said at the elections that tax reductions would be made at the appropriate time. We have kept our promise and have made reductions progressively. Another important aspect of the Menzies proposal was that the 1,500,000 taxpayers, who would have been called upon to pay only ls. 6d. each a week less in taxes, would have been required to pay at least twice as much in social services contributions under the proposed contributory scheme as they are obliged to pay to-day. Mr. Menzies referred, during the election campaign, to the social services of New Zealand and
Great Britain. In New Zealand, the social services contribution from every £l of income earned is ls. 6d.. Every person who earns money must contribute at that rate. The British scheme is on a per capita basis. If the -Australian scheme were similarly based, the approximate cost for each individual would be £1 a week. This would be divided between the employers, the employees and the Government. Each group would have to pay £44,000,000 a year. Thus, the taxpayers on low incomes would have to pay approximately 6s. 6d. each a week, which would represent 300 per cent, of their present commitment. The condemnation of Mr. Menzies, of which the Leader of the Opposition has complained, was directed, not at the principle of tax reduction, but at the means of implementing his proposals.
Senator Cooper said that he doubted whether the Government’s tax reductions would benefit small business men, primary producers, and others working on their own account. I have bad the statements made by the honorable gentleman examined, and I am in a position to announce that the reductions will be of considerable benefit to farmers and business men as well as to wage-earners during the financial year 1947-48. Farmers and business men will obtain the benefit of the reductions in their assessments of provisional tax payable in respect of the year that will end on the 30th June, 1948. These assessments will be issued during that year. Provisional tax assessments are an integral part of the pay-as-you-earn system of taxation. Normally, the provisional tax payable would be equal to the amount of income tax assessed for the previous financial year. However, because of the reduced rates of tax, the provisional tax payable for the financial year L947-48 will be lower than it otherwise would be. These reductions will accord with the reductions proposed in this bill. A similar position will obtain for the purposes of social services contributions.
Another suggestion made by Senator Cooper was that .the Government should re-establish the Public Accounts Committee, but I point out to him that tha4 committee was abolished in 1932 by the Government of which he was a supporter.
That Government continued in office until 194a, and in that period huge financial commitments were entered into by way of war and other expenditure, but it was never suggested by members of the present Opposition that the committee should be re-established. In view of the curtailment of war-time expenditure, and the small number of public works being undertaken in the post-war period, I ask what need there is for reconstituting the Public Works Committee?
– In 1932, when thb Government abolished the Public Accounts Committee, members of the Australian Labour party, who were then in opposition, were very much opposed to its abolition.
– Another criticism made by Senator Cooper was that superannuation pensions should be exempted from payment of income tax. However, it is clear that pensions are in the nature of income, and as such should be taxable. If the amount of the pension is less than the . permissible income, it will not be taxable. Obviously, there is no justification for exempting superannuation pensions from taxation while people receiving similar amounts as wages have to pay tax. Furthermore, the tax concession on superannuation contributions confers .a substantial benefit on contributors. They cannot have it both ways ; and it ie better for them to pay tax on the income they receive when retired rather than on contributions which they make while working for wages. Another matter suggested by Senator Cooper was the exemption from income tax of money spent in combating soil erosion. When he mentioned this matter last year the Government promised that it would consider his representations and that promise has been kept by the provision inserted in this bill.
– Yes, I give the Government credit for that.
– Another matter suggested by Senator Cooper was that special concessions should be extended to settlers in the northern parts of Australia, including the Northern Territory and the north-western portions of Queensland and Western Australia. I point out to him that the zone system has been introduced, and the special zone deduction has been increased from £40 to £120 a year. That is an increase on the former concession, of 300 per cent.
– Only in one zone.
– I agree; but there must be a limit to concessions which can be made if the public revenue is to be maintained, and the concessions whichI have mentioned are considerable.
Adverse comments were made by members of the Opposition regarding the continued levy of company and other taxes. However, the number of people overseas who are anxious to set up business in this country refutes that criticism. Although [ do not suggest that the Government is entitled to all the credit for it, I think that Australia is in a very sound ecouomic position. T am pleased’ with the reception accorded this bill by the Senate and I thank honorable senators for their remarks..
Question resolved in the affirmative.
Bill read a second time.
Clauses 1 to 4 agreed to.
Clause 5 (Exemptions).
– While commending the Government for continuing the exemption from income tax of settlers in the Northern Territory for the years 1947 to 1952, I point out that the continuance of the exemption for a further period of five years is quite inadequate, because persons who settle there require to invest a considerable amount of capital in the first place. I invite attention to the excellent report submitted by Mr. R. G. Casey when he visited the Northern Territory a short time ago. Investments in the pastoral industry are not ones which show a quick return. At present there are approximately only S,000 people in the territory, and the Payne-Fletcher Report a few years ago estimated that the population in the northern areas could be increased to probably 30,000 in a period of from ten to fifteen years. The Commonwealth Government is spending something like £1,000,000 on the territory, but to show that we are sincere in our White Australia policy itis necessary for us to do something concrete to promote settle ment in these vast spaces. We mustmake some show to the teeming millions to the north of Australia to convince them that we are doing something to populate this huge area from which we are excluding them. One of the best methods of encouraging settlement in the Northern Territory is to afford security of tenure to leaseholders, and I suggest the adoption of something along the lines of the Queensland leaseholds, which provide for a minimum period of 30 years, before a resumption can be made, and include other financial safeguards. I think we should extend considerably the period of exemption from taxation. Honorable senator; may ask what loss of revenue to the Government that would involve. The amount collected in taxes in the Northern Territory is insignificant compared with the aggregate amount collected in Australia. Nevertheless, great advantage would be obtained by publicizing the fact that the Government is prepared to accord generous treatment to bona fide settlers. Such treatment would permit them to make long-range plans, and that would bran added inducement to settlement.
– The Government has already made a considerable concession, and 1 assure the honorable senator that at the expiration of five years the matter will again be reviewed and consideration given to his representations.
– With regard to the exemption provided for prospectors for gold and other minerals, does that exemption cover the incomes of members of a syndicate endeavouring to develop a gold mine? Very often the members of the syndicate contribute £200 or £300 each and employ someone else to prospect for them.
Senator ASHLEY New South Wales(Minister for Supply and Shipping) [4.19]. - If the members of the syndicate make a contribution towards the outlay involved they are covered by the exemption.
Clause agreed to.
Clauses 6 to 11 agreed to.
Clause 12 -
Section seventy-five of the Principal Act is a mended -
by inserting after paragraph (f) the following paragraphs : - (h.) the construction of dams, earth tanks, underground tanks, irrigation channels or similar structural improvements, or the sinking of bores or wells, for the purpose of conserving or conveying water for use in carrying on primary production on the land; and
. -I again commend the Government for allowing as a deduction in respect of income tax expenditure incurred on the items set out in the clause. However, I should like to know whether in paragraph h the phrase “ for the purpose of conserving or conveying water for use in carrying on primary production on the land “ includes expenditure incurred in the conveying of water in piping. In many areas, particularly in artesian areas where bores have ceased to flow, the water is now pumped to the surface. Many of those bores are from 2,000 to 4,000 feet in depth, and settlers find it cheaper to pipe water from existing bores for distances up to 5 miles rather than sink new bores to such depths. Even when new bores are sunk, the water must still be pumped.It can be pumped in unlimited supplies, and it has become the practice to pipe the water from such bores to various parts of a property. Provision is made in respect of expenditure on the construction of open drains, or channels, for the conveyance of water, but in such drains, particularly in summer in north-west Queensland, the loss of water by evaporation and absorption is as high as 90 per cent. That, of course, is not desirable, because we should conserve water as much as possible in such areas. By contrast, little water is lost when it is conveyed in piping. I should like to know whether the clause covers expenditure on the conveyance of water in piping. I believe that the Minister will readily see the advantages of the piping system.
– The clause does not cover expenditure in respect of the conveyance of water in piping. However, allowance is made either by annual depreciation or the cost of replacement. I cannot accept the suggestion made by the honorable senator. If I did so, the provision would have to be made in respect of similar expenditure in many other industries.
– In the hope that provision may be made at some future date along the lines I have suggested, I move -
That, in paragraph (h), after the word “ wells “ the following words be inserted : - “ or the use of piping, “.
Question put -
That the words proposed to be inserted (Senator Cooper’s amendment) be inserted.
The committee divided. (The Chairman - Senator T. M. Nicholls.)
Majority . . . . 10
Question so resolved in the negative.
– Paragraph g provides for a deduction in respect of expenditure incurred in “ preventing or combating soil erosion on the land otherwise than by the erection of fences “. I should like to know whether that provision includes expenditure incurred in the erection of new fences. In order to prevent soil erosion a primary producer often finds it necessary to plant breaks, and in order to protect the young plants from stock, they have to be fenced off. I should like to know whether this provision applies to expenditure incurred in the erection of such fences. As I read the clause, no provision is made in respect of expenditure incurred in the erection of new fences. However, the erection and maintenance of fences are just as essential in increasing production as the construction of irrigation channels. Furthermore, should a farmer completely restore an old fence of which onlya few posts were left standing, the expenditure thus incurred would be covered by this provision, as such work would be classified as the repairing of a fence. The erection of a new fence may be just as essential to increased production as the construction of wells, dams and channels. [ refer especially to fences erected to protect trees which may be planted to check soil erosion.
– No deductions except by way of depreciation will be allowed in respect of new fences, wherever and for whatever purpose they may be erected. An allowance is made however, in respect of the cost of repairing fences. These matters were discussed with members of graziers and settlers associations when the bill was being drafted, and the present provisions are the result of those discussions. The matter to which the honorable senator has referred will receive consideration when further legislation is being drafted.
– I bring this matter forward particularly in the interests of small settlers on whose holdings fences are necessary for the maximum production. They are in a different position from graziers who measure their holdings in terms of square miles rather than acres. I ask the Minister to give to this matter further consideration in the interests of small settlers to whom a deduction would be of great benefit.
.- Recently, I had to renew a fence on my property at a cost of £125. If a farmer is entitled to an allowance for depreciation, others also should be entitled to it. This is a matter which should be regarded from the point of view of the nation, although I do not object to sympathetic consideration being given to it by the Government. However, the granting of concessions can be carried too far. A line must be drawn somewhere.
– This clause deals specifically with rural production. If it had general application I might have adopted a different attitude.
Clause agreed to.
Clause 13 agreed to.
Clause 14 (Deduction for residents of isolated areas).
– This clause deals with deductions ou behalf of residents of isolated areas. Already persons living in certain areas are allowed some deductions. This bill provides that the deduction allowed to residents of Zone A shall be increased from £40 to £120. The allowable deduction in respect of residents of Zone B is to remain at £20. I should like the department to examine the boundaries of Zone A. That zone includes Cape York, in north Queensland, and includes a portion of the State served bythe northwestern railway. From there it extends south, and includes a large area of country, some of which is 250 miles from a rail-head. Naturally, the cost of maintaining a property in such a locality is higher than in a district served by a railway because materials have to be carted for distances up to 250 miles by road. The line then runs across to Western Australia through some sparsely populated country to the north of South Australia. I knowthat portion of Zone A which is situated in Queensland and I consider that an error has been made in excluding from these benefits residents living many mile? from a rail head, many of whom are sadly in need of assistance and I hope that the boundaries of Zone A will be re-examined with a view to including them.
– In my second-reading speechI said that additional deductions wen- being provided for, andthat some anomalies would arise in respect of the zone allowance. The introduction of the zone system was an attempt to arrive at an equitable basis for measuring relief from taxes. Wherever . the line marking the boundary of a zone may be drawn there will still be anomalies. I am prepared to ask the departmental officers to examine Senator Cooper’s request, but further than that I am not prepared to go at this stage.
Clause agreed to.
Clauses 15 to 19 agreed to.
Clause 20 (Exploration and prospecting expenditure).
– I should like an explanation of sub-sections 1, 2 and 3 of proposed new section 123aa. I particularly desire to know why expenditure incurred in prospecting for gold and petroleum are excluded from consideration in calculating allowable deductions. Are they covered by some other provision? Sub-section 2 of the proposed new section reads -
The amount of the deduction allowable under this section shall not exceed the amount remaining after deducting from the assessable income derived from the carrying on by the taxpayer of a mining business, and from the activities of the taxpayer associated directly or indirectly with the carrying on by him of that business, all other allowable deductions which directly relate to that income.
I should like to know what it means. Sub-section 4 (a) defines “ exploration or prospecting “ as “ geological mapping, geophysical surveys, systematic search for mineralized areas, and detailed search by drilling or other means for ore deposits within those areas “. Can the Minister say whether expenditure incurred in proving the extent of an ore body by a prospecting syndicate would be an allowable deduction.
– There are provisions for deductions in respect of expenditure incurred in the search for minerals other than gold and petroleum and coal. Gold and petroleum are provided for elsewhere in the act. It is already known that there are practically inexhaustiblesupplies of coal in Australia.
SenatorO’Flaherty. - What isthe meaning of sub-section . 2 ?
– It meansthat the deduction in respect of prospecting expenditure may not exceed the net income derived from mining.
– I understand that certain State laws provide that prospectors may be granted assistance with respect to tools and other equipment used by them. Under this provision they are to receive exemptions in respect of income tax. They also are entitled to exemption on a normal zone basis. I should like to know whetherthe normal zone basis is applicable to the exemptions covered by this provision. In other words, can a prospector be given an exemption under both heads.?
– If he is operating within the zone he gets both exemptions.
Clause agreed to.
Clauses 21. to 23 agreed to.
Clause 24 (Concessional Rebates).
; - Something has been said about the promise made by the Leader of the Opposition in the House of Representatives (Mr. Menzies), that if his party were returned to office,child endowment would be paid in respect of the first child of each family. When it was suggested in this chamber that the motive behind that promise was a reduction of wages, the Opposition said that the charge was fantastic; butwe have had some experience ofthis sort of thing before, and I am delighted that the Chifley Government has not fallen into the trap. In New South Wales many years ago, the then Labour Government introduced a child endowment bill. At that time the basic wage was based on the needs of a man, wife and two children. The conservative upper House threw the bill out, and the Labour Government agreed that the basic wage should no longer be based on the needs of a man, wife and two children but on those of only a man and his wife. It was claimed, and with some truth, that the aim was to establish a principle, but what actually happened - and it would have happened again - was this : There was a reduction of wages by about £5,000,000 in New South
Wales. Tie basic wage of a single man waa reduced by 10s. a week, that of a man with a wife and no children by the -nine amount, that of a man with a wife and one child by 5s., whilst that of a man with a wife and two -children remained at the previous figure.
THE CHAIRMAN (Senator Nicholls) -Order! The honorable senator is not entitled to make a second-reading speech “in this clause.
– I shall not question your ruling, Mr. Chairman.
– This is a most important clause. I welcome the decision to include the cost of -diathermic treatment administered under the direction of .a legally qualified medical practitioner in the allowable concessional deductions for medical expenses. Diathermy is a most important part of medical treatment, especially following a ci-ious operation. [ ask the Minister for Supply and Shipping (Senator Ashley) whether the Government will give consideration to liberalizing the medical expenses concession by providing that deductions in respect of such expenses may be spread over a period of years. It frequently happens that a person has to undergo an operation, the cost of which far exceeds the limit of his annual concessional deduction for medical expenses, whereas in the following year or two he may have no medical expenses at all. I suggest that n taxpayer should be entitled to claim a concessional deduction in respect of medical expenses over a three-years period, and I ask the Minister to give consideration to this -very important and urgent matter.
.- This clause deals with rebates and deductions. There has been so much criticism in both Houses of Parliament in regard to this matter that I think the Minister for Supply and Shipping (Senator Ashley) should make clear the difference between a deduction and a rebate.
– Paragraph h of this clause provides for the substitution of the words “ nineteen years “ for the words “ eighteen years” in that portion of the act relating to concessional deduction? in respect of children of more than sixteen years of age who are wholly maintained by a taxpayer, and are receiving full-time education. I have received representations from taxpayer? whose sons and daughters are attending schools of higher education, particularly universities, for the increase of the age limit from eighteen years to 21 years. The number of dependent children coming within this category would not be great, but the taxation concession would be of great assistance and might be sum dent to enable a parent taxpayer to meet the cost of a university education for his son or daughter. In cases such as tEi.we should err on the side of generosity rather than on the side of niggardliness.
.- I support the request .that has been made by Senator Cooper. I know from personal experience that- as boys get older and go through a university the cost of their upkeep and education increases year by year. Some consideration should be given to the raising of the age limit, and I think that 21 would be a reasonable age.
– Paragraph m of this clause deals with deductions for the maintenance of parents. There are many cases in which a parent .is maintained by perhaps three or four members of his or her family at different periods throughout the year. For instance, a mother who has three son? may live with each in turn. In these circumstances no one child who is a taxpayer can claim that his parent is wholly maintained by him. I should like to know if it would be possible to provide a concessional deduction for any taxpayer maintaining a parent for portion of the year only.
– I shall deal first with the last point raised by Senator Cooper. Any taxpayer who wholly maintains a parent for a fixed period is entitled to a concessional allowance. Senator Allan MacDonald referred to concessional deductions for medical expenses. I point out that these concessions are allowed on a family basis, tie maximum amount permissible in the case of each member of the family being £50. However, consideration will be given to the honorable senator’s suggestion that where a member of a family has to undergo an expensive operation or to undertake costly treatment the concessional deduction should be spread over three years.
Senator Cooper and Senator Lamp have urged the raising of the age limit for concessional allowances in respect of dependent children receiving full-time higher education. I point out that until last year a deduction was not allowable in respect of any student child of more than sixteen years of age. The age limit was increased to eighteen years in respect of children receiving full-time education, and this measure further extends the limit to nineteen years. The policy of the Government in regard to these matters is to proceed step by step. However, consideration will be given to the representations that have been made by the honorable senators.
– With further reference to the statement by the Minister that anybody who contributes to the upkeep of parents is allowed a deduction for income tax purposes, I cite the case of a taxpayer who pays rent for his parents’ home. I know of a man who has been doing so for a number of years. Is he entitled to a deduction for the amount of rent paid on behalf of his parents?
– No allowance is made in such oases. The concession permitted in respect of parents applies only if they are fully maintained by the taxpayer.
– I thank the Minister for Supply and Shipping (Senator Ashley) for his assurance that my previous suggestion will be considered. I refer now to a proposal affecting concessional rebates, which I made on another occasion when the tax burden was not so onerous as it is to-day, namely, the allowance of a deduction for the cost of educating children at other than State schools. I know that departmental officers view my proposal with grave doubt. Their contention is that free education is available throughout Australia and that, therefore, children can be sent to State schools. Nevertheless, the factremains that in Australia there are large numbers of denominational and private schools which give a very high standard of education. Their existence relieves the education departments of the States of a huge annual burden of expenditure. The cold fact is that if there were no such schools the various State governments would be at their wits’ end seeking to provide free education for all children. I doubt whether they could do so at present. Therefore, there is a strong argument in favour of granting deductions to parents who are prepared to pay for the education of their children, thu*relieving the States of that cost. I have maintained for several years that expenditure of this character should be exempt from income tax. I now suggest to the Minister for Supply and Shipping that provision be made for such exemptions.
– I refer to the allowances made in respect of housekeepers. According to my interpretation of the clause before the committee, if a man has the misfortune to lose his wife and engages a housekeeper to care for his children deductions are allowable only while the children are under the age of sixteen years. I consider that from the age of sixteen years onwards a daughter needs at least as much care as she receives in her more tender years. Theref ore, the allowance in respect of a housekeeper should be permitted while any children in the taxpayer’s family living at home are under the ag*of 21 years. The taxpayer is obliged not only to maintain the housekeeper but also to pay her wages. Very few hired housekeepers are as efficient in the management of household affairs as a man’s wife would be. I consider that a deduction in respect of a housekeeper should be permitted while children under the age of 21 years are resident in a taxpayer’s home.
– The principle applied in respect of the allowance for a housekeeperis the same as that applied to an ordinary family. I wish to inform Senator Allan MacDonald that allowances in respect of school fees were carefully considered by the Treasurer (Mr. Chifley), who could not see his way clear to do more than raise the age limit to nineteen years in respect of children receiving full-time education. The position will be examined again next year in order to ascertain whether further concessions can be made in this regard.
– This clause provides that allowances shall be made in respect of a housekeeper who has the care of any of a taxpayer’s children or step-children under the age of sixteen years, or of any other children in respect of whom the taxpayer is entitled to a 2’ebate. I want to know whether the taxpayer will lose the right to the deduction on behalf of a housekeeper when his children pass the age of sixteen years. If they remain with him be is still obliged to pay the expenses of maintaining a home for them. I ask the Minister to clear my mind on that matter. I may have overlooked some other provision in the bill for an allowance in respect of a housekeeper even when the taxpayer’s children are over the age of sixteen years.
– I am sorry that I did not make myself clear. The provision in relation to a housekeeper or anybody engaged in the care of a taxpayer’s children is the same as that which applies to an ordinary family. It is assumed that the conditions in that family will be the same ms in an ordinary family and that as each child reaches the age of sixteen years it will normally go to work.
– Am I right in assuming that, unless there are children in the home under the age of sixteen years, no allowance is made in respect of h housekeeper?
– I claim that a child, especially a girl, needs just as much care at the age of sixteen years and later as at an earlier age. If a girl stays in the home until she reaches the age of 21 years does the father still receive an allowance in respect of a housekeeper ?
– If the girl is an only child, no.
.-] regret that the facts are as the Minister for Supply and Shipping (Senator Ashley) has stated, because thi3 procedure represents a departure from the previous practice. I know of cases in which taxpayers have been granted exemptions in respect of housekeepers although there have not been any children under the age of sixteen years in their homes. I believe that last year the law was amended so that a taxpayer could secure a rebate on behalf of a housekeeper just as in the case of a wife. Unless the bill retains this provision; it should be amended. I have received letters of thanks from taxpayers whom 1 have assisted to secure this concession by writing to the Taxation Commissioner. I fear that there is a misunderstanding on this point.
– In view of the Minister’s definite statement, I ask him to bring this matter before the Government at a later stage and press for an amendment along the lines I have suggested.
– Why not move an amendment to the bill now? Is the honorable senator afraid to do so?
– I think I can achieve my object by other means. I claim that a widower who is left with a family of children, particularly daughters, and who is fortunate enough to be able to engage a housekeeper who will give care and protection to the children, is entitled to a deduction in respect of that woman. Deductions that are not so important as the one I suggest have been granted. I am of the same opinion as Senator Lamp. I am beginning to fear that there is some misunderstanding. If not, I hope that the Minister will bring this matter before the Government with a view to making provision for this urgently needed relief in appropriate cases.
.- I think that the Minister’s statement was incorrect. A widower can obtain a deduction in respect of a housekeeper. The case stated by Senator Aylett is that of a widower. I believe that, even if the childrenof a widower have passed the age of sixteen years, he is still entitled to a deduction in respect of his housekeeper. That did not apply in the past, but it will apply in future.
– I shall have the matter raised by Senator Aylett brought to the notice of the Government for consideration. I. want to make sure that the honorable gentleman is clear about the facts of this case. Therefore, I repeat that a concession for a housekeeper only operates while the taxpayer’s children living in the home are under the age of sixteen years.
-Does not a widower obtain an allowance for a housekeeper?
– Not when all the children in the home are over the age of sixteen years.
.- I urgently suggest that the Government postpone this clause with a view to making provision for the case stated by Senator Aylett. Under a previous measure, a widower was entitled to exemption in respect of a housekeeper.
Clause agreed to.
Clauses 25 to 28 agreed to.
Clause 29 (Deduction by employer f rom salaries and wages).
– This clause deals with deductions to be made by employers from salaries and wages paid to their employees. At times it is difficult to determine on whom the. responsibility rests for making deductions. For example, in the case of a shearing contractor, can the Minister inform me whether the contractor is responsible for deducting the tax on his employees’ wages, or is it the responsibility of the property owner who employs the contractor and shearers? A similar position arises in regard to drovers. I should like some clarification of the position.
– In the cases mentioned by Senator Cooper the contractor would be responsible.
– And if the deductions are not made by him is the property owner responsible ?
– The employer is responsible.
Clause agreed to.
Clauses 30 and 31 agreed to.
Clause 32 (Registration of tar agents) .
– This clause provides for anamendment of section 251j of the principal act, which states that registration of tax agents shall be dependent on the applicant satisfying the Tax Agents Board in the State thai he is qualified for registration.The amendment relates to partnerships and companies. I have in. mind companies whose registered offices are overseas, although their operations are conducted in Australia. A literal reading of the clause would suggest that some time must elapse before the companies local officers could supply testimonials of the integrity, good fame and character of the directors, because that information would have to come from other parts of the world. I suggest that an amendment be made in this clause by inserting in paragraph a. after the word “ company “ the words “ resident in Australia and “, and that a consequential amendment be made in paragraphb by inserting thosewords after the word “ person “. However,I do not desire to press my suggestion if a satisfactory assurance is forthcoming from the Minister for Supply and Shipping (Senator Ashley).
.- It is not known whether any companies outside Australia are desirous of being registered, but if any such applications are made consideration will bo given to the suggestion made by the honorable senator.
Clause agreed to.
Clauses 33 to 38 agreed to.
Title agreed to.
Bill reported without amendment ; report adopted.
Bill read a third time.
Debate resumed from the 16th May (vide page 2508), on motion by Senator Ashley -
That the bill be now read a second time.
– I do not intend to address the Senate on the motion for the second reading of the bill, because the measure is complementary to the Income Tax Assessment Bill which has just been debated.
– I welcome the introduction of this bill, although it is somewhat belated, but I think that the reduced rates of tax should be operative from the 1st January last instead of the 1st July next. Those reductions could very well have been made twelve months ago. Under the new scale of taxation the permissible income will be £250, as against the present amount of £201. Income tax is going to be a heavy burden on our community for many years to come, and I believe that that is inevitable after the colossal expenditure and destruction of assets incurred during the war. We have to make a recovery, and suffering recoveries is usually not very pleasant. That is all the more reason why the imposition of income tax should be rational and equitable. Our income tax provisions have been so altered and amended over the years that to-day they resemble a building supported by props. They are a mass of anomalies and inequities, but because we are a democracy, and the government of the day is subject to pressure by various groups, that is inevitable. However, the result is that to-day very few people know exactly what their tax obligations are. In this way we have founded a rather flourishing industry in this country. To-day, many former employees of the Taxation Department have set up in business for the purpose of showing taxpayers not how they can dodge tax but how they can legitimately reduce their tax. I repeat that our taxation set-up abounds with anomalies and inequities. The job of evolving a scientific system is a task for experts. It cannot be undertaken effectively by Treasury officials or by n parliamentary committee. Many, difficult problems are involved, such as, the complexity of the basis upon which tax is assessed, the discrimination against composite incomes, the concessional allowance instead of the straight-out deduction in respect of family and other liabilities of the taxpayer, the incidence of war-time company tax on public companies and the short-comings in respect of deductions for depreciation and alterations of buildings, as well as a host of other difficulties. After all, it is a virtue and a national benefit that high incomes should be earned. I have heard a lot of loose talk to the contrary, but, undoubtedly, it is in the national interest that high incomes)1 should be earned. Therefore, there is no point in discouraging such earnings from either personal exertion or investment by maintaining excessive tax rates or exasperating tax complexities. We have just dealt with a measure which makes certain provision in respect of tax agents to whom I have just referred. Many former employees of the Taxation Department earn a good living by showing not the wage-earner, or the man on a fixed salary, but the businessman and the grazier and other classes of taxpayers how they can reduce the amount of tax they need pay. We must simplify our system of taxation. Very few taxpayers in Australia are able to calculate their liability for tax. Our system is far more complicated than that operating in Great Britain or New Zealand. Therefore, I suggest that a royal commission be set up in the near future to investigate our system of income taxation generally. Any expenditure in an endeavour to simplify the present system would be well justified.
I shall deal now with collections of the income tax. When we advocated last year that income tax should be reduced, our suggestions were practicable and not nonsensical as was alleged by supporters of the Government. This fact is borne out by the collections of income tax for the first ten months of the current financial year compared with those for the corresponding period of the preceding financial year. In that period this year collections of tax have amounted to £140,319,000 compared with £140,931,000 in the corresponding period in the preceding financial year, or £612,000 less.
This result has been achieved in spite of two reductions of rates made as from the 1st January, 1946, and on the second occasion as from the 1st July, 1946. Despite those reductions, income tax collections decreased by only £612,000 in the period mentioned. The Treasurer (Mr. Chifley), in his budget statement, estimated that those reductions would amount to a total concession of £37,000,000 for a full financial year. Considerable doubt exists as to whether all revenue available from income tax has been collected. I presume that there must always be a lag; but it appears to me that the amount of uncollected and unassessed income tax mentioned recently by the Minister is altogether too high.
The reductions of tax proposed under this measure are loaded very much in favour of the lower ranges of incomes However, as I said earlier, I am glad that the minimum limit of income liable to tax has been raised from £201 a year to £251 a year. Political expediency may seem to demand .this, but one of these days we shall have to pay more attention to economic considerations. The proposals contained in the bill are quite contrary to all the Treasurer’s talk about the necessity for keeping up tax rates in order to keep inflation down. By that I mean that the incomes that are expended mainly on goods which enter into what is called the standard of living, and many of which are in short supply, are favoured at the expense of incomes portion of which is likely to be saved and used in investment, or otherwise to stimulate production. Avoidance of that state of affairs was at least one virtue of the proposal for a flat-rate reduction of income tax made bv the Leader of the Opposition in the House of Representatives (Mr. Menzies), as Leader of the Liberal party. It was also a virtue of the proposal of the Leader of the Australian Country party (Mr. Fadden) that all taxpayers should benefit by a reduction of at least 20 per cent, of their respective rates. The scheme proposed under this measure effects an average reduction of about 60 per cent, of the tax now paid on incomes of less than £10 a week, but an average reduction of only 15 per cent, of the tax now paid in respect of incomes above that level.
Reverting to uniform income tax, I remind the Senate that that system was introduced as a war measure about five years ago. However, legislation passed recently had the effect of excluding the States from the income tax field. It is all very well to say that the States can still levy income tax; but we know that after the big fellow has collected his bones there is none left for the little fellows. We must make up our minds whether we are to remain a federation or develop a unitary system of government. There must be a definite allocation of the fields of taxation as between the Commonwealth and the States. The Commonwealth’s power to tax incomes should be limited to federal purposes, and, of course, Commonwealth activities are increasing all the time. This line of demarcation is essential if local self-government is not to be destroyed by abuse of the Commonwealth’s financial powers. Uniform income tax was essential as a war-time measure, but if the same policy be applied in peacetime it can, and will, destroy federation, and will impose centralization and bureaucratic control, if not openly, then by stealth, because of the over-riding powers of the Commonwealth in the field of income taxation. Therefore, I view with some misgiving the result of this trend, because I am a federalist, and to-day the States are rapidly being emasculated. They are simply at the beck and call of their financial master, the Commonwealth.
– I propose to deal with only one aspect of the measure. I refer particularly to the preparation of tables of the weekly deductions to be made under the pay-as-you-earn system. . Unfortunately, after deductions were made under the tables prepared in the past, 50 per cent, of wage-earners found that when they received their assessments they had to pay a considerable amount in a lump sum in addition to the amount deducted weekly from their wages. Of course, we do not hear complaints from the other 50 per cent, of the taxpayers, who, under those calculations, found that they were entitled to a refund of tax. All of the complaints in this respect come from those who find that deductions made from their wages are not made at a rate sufficient to meet the tax actually assessed. Therefore, I suggest that those charged with the responsibility of compiling these tables in the future should endeavour to ensure that, under their new calculations, 90 per cent. of taxpayers shall find when they receive their assessments that they are not still in debt to the Taxation Department, or are entitled to a refund of tax. I do not know whether that objective can be achieved, but it should be borne in mind in order to avoid a recurrence of the complaints to which I have referred.
Question resolved in the affirmative.
Bill read a second time.
Sitting suspended from 5.51 to 8 p.m.
– In his second-reading speech Senator Sampson referred to the date of commencement of the proposed reductions. They will apply from the earliest practicable date, which is the 1st July next. The state of Commonwealth finances precludes their commencement from an earlier date, and, moreover, that would not be possible without straining to breaking point the already overburdened Taxation Department.
The honorable senator also referred to the complexities of the Commonwealth income tax laws. It is somewhat strange that that complaint should be voiced when reductions of taxes are about to be made. Although Commonwealth income tax legislation is not simple it is less complicated than are the income tax laws of the United Kingdom, the United States of America and Canada.
– The laws in those countries must indeed be bad.
– It must be remembered that we are living in a complicated period, both internationally and industrially. Unfortunately, high taxes are necessary as the result of two world wars. The organization of present-day industry does not lend itself to the simplification of taxation laws. Some of the representations made from time to time by the Opposition in favour of greater reductions of taxes would increase the complexity of the legislation.
Senator Sampson also referred to uniform taxation, and said that eventually the system would lead to complete domination of the tax field by the Commonwealth. Under the system of uniform taxation many taxpayers in the lower ranges of income will pay less than they did in pre-war years, when they paid taxes to both Commonwealth and State Governments. For instance, from the 1st July next a married taxpayer with one child will pay £2 5s. in taxes on an income of £300 per annum.
– He would get more satisfaction from paying taxes to the State.
– Compared with a payment of £2 5s. from the 1st July next, a married taxpayer with one child, on an income of £300 per annum, paid to Commonwealth and State Governments the following amounts: Victoria, £3 16s.; New South Wales, £5 6s. 4d. ; Queensland, £8; South Australia, £811s.11d.; Western Australia, £818s.5d.; and Tasmania, £7 9s.10d. Those figures show the benefits which taxpayers in that category receive under the uniform taxation system.
Bill agreed to.
Bil] reported without requests; report adopted.
Bill read a third time.
Debate resumed from the 16th May (vide page 2509), on motion by Senator Ashley -
That the bill be now read a second time.
– This bill is a machinery measure to implement the reductions proposed by the Income Tax Assessment Bill. It extends the amount of income which can be received before taxes have to be paid, and also reduces the rate of tax from oneeighth of a penny in the £1 on income in excess of £100 to one-tenth of a penny in the £1. The Opposition agrees with the proposed reduction of taxes on lower incomes and will not delay the passage of the bill.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
Debate resumed from the 16th May (vide page 2510), on motion by Senator
That the bill be now read a second time.
– This is another machinery bill, the object of which is to implement certain provisions of the Income Tax Assessment Bill. It increases the minimum value of a gift on which duty shall be paid in one year from £500 to £2,000. The Opposition has no desire to oppose the measure or to delay its passage.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from the 16th May (vide page 2510), on motion by Senator Ashley -
That the bill be now read a second time.
– This bill is complementary to tie Gift Duty Assessment Bill with which the Senate has just dealt. The Opposition is in favour of it, and will not delay its passage.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without requests or debate.
In, committee: Consideration resumed from the 16th May (vide page 2512).
Clauses 3 to 6 agreed to.
Title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Debate resumed from the 22nd May (vide page 2735), on motion by Senator Armstrong -
That the bill benow read a second time.
– This bill provides for certain grants to the States for the construction and maintenance of roads. It involves two principles. The first is whether revenue from the petrol tax should be used for the purpose for which it was first intended, namely, for the construction and maintenance of roads, or whether it should be retained as a revenue-producing tax. Before dealing further with that matter,I should like to give a brief history of the petrol tax. It was first introduced in 1926 by the Bruce-Page Government. I commend the right honorable member for Cowper (Sir Earle Page), who was then Treasurer of the Commonwealth, upon his foresight in those days. The right honorable gentleman realized the part that would be played in developing our inland areas by road transport and introduced this special tax as a means of providing revenue for the construction of roads. Under the Federal Aid Roads Agreement made in 1926, a tax of 3d. a gallon was imposed on all petrol used in this country, and in the 21 years that have passed since then, the revenue so raised has proved of inestimable value and benefit to the outback areas of Australia. It has provided for people living in those areas road facilities more in keeping with those enjoyed by citizens residing in the larger centres of population.. In principle, the bill carries on some of the main features of the original Federal Aid Roads Agreement. In 1930, the tax was increased by 4d. a gallon by the Scullin Government as a means of raising revenue in the depression days, when it was necessary to obtain finance from every possible source so that our budget could be balanced. I am sure that the community as a whole, particularly the motoring community, which was most vitally affected, paid the extra tax willingly in view of the financial difficulties that faced this country. But the tax has remained to the present day. In 1940 an extra 4-Jd. a gallon was imposed for war revenue purposes, making the total tax at that time ll-£d. a gallon. No one could have objected to that wartime imposition when our full productive capacity and- man-power resources were being regimented to ensure a maximum war effort. In November of last year, the customs duty on petrol was reduced by Id. a gallon, so that the total tax today is 10d. a gallon. The basis of allocating revenue raised by means of the tax has remained practically unaltered from the time of its inception.
The payment made to the States for road construction and maintenance is still the equivalent of 3d. a gallon, although the total sums distributed to the States have increased owing to increased consumption of petrol. In the ten years from 1927 to 1937 the total con.sumption of petrol in this country was 1,914,000,000 gallons, and the revenue collected by means of the petrol tax was approximately £52,000,000. Of that sum, £22,000,000 was made available for road construction and maintenance, the remaining £30,000,000 being paid into Consolidated Revenue. In the following ten years from 1937 to 1947 - I have estimated the figure to the 30th of June this year - the consumption of petrol in this country will total 2,510,000,000 gallons, and the revenue collected from the petrol tax £111,000,000. In that period the amount allocated for the building of roads will have been £31,000,000, and the amount’ paid into Consolidated Revenue, £72,000,000. .So, in twenty years, £153,000,000 has been collected from petrol users in this country and £53,000,000 has been paid to shire councils and various other bodies for the building and maintenance of roads, leaving approximately £100,000,000 for Consolidated Revenue. The petrol tax, therefore, has become a revenue tax, because the figures I have given show conclusively that the sum that has been paid into Consolidated Revenue greatly exceeds that used for the building and maintenance of roads. It is true that those years include six years of war, when money was urgently required, but I point out that, long before the war, the proportion of the proceeds of this tax paid into Consolidated Revenue was substantial. Not only is the petrol tax a revenue tax, but also it is a sectional tax, because only one section of the community pays it. That section includes private motorists, public carriers, bus service operators, fishermen, private boat owners, owners of boats for hire, and farmers who use petrol for shearing engines, pumping engines and so on. These people pay the petrol tax in addition to all other taxes imposed upon the community.
According to figures just released by the Treasurer (Mr. Chifley) and published in to-day’s press, the coffers of the Treasury are bursting with surplus wealth. The Treasurer has disclosed that he expects a surplus at the 30th June, of £43,000,000. It cannot be said, therefore, that the petrol tax is required to bolster our revenues. One course open to the Government is to devote the entire proceeds from the petrol tax to the construction, improvement and maintenance of roads, to the construction and maintenance of aerodromes, and for the provision and maintenance of jetties, boat havens, beacons, &c, according to the proportion of the revenue derived from each of these three fields. Alternatively, the tax should be substantially reduced, say by 6d. a gallon, so that those who have paid it since the depression days and throughout the war may benefit by the surplus revenues now enjoyed by the Commonwealth. In the current financial year, the estimated yield from petrol tax is approximately £16,000,000. Of this amount, the Government proposes to hand over £6,000,000 to the States for the purposes of roads, country aerodromes, and the fishing industry. This will leave an amount of £10,000,000 to be contributed to Consolidated Revenue. It is proposed that £4,500,000 shall be used for the construction and maintenance of roads, that £1,000,000 shall be used for the construction of roads in sparsely populated areas, that £500,000 shall be used to build roads of access to Commonwealth properties, and that £100,000 shall be applied to road-safety work. This makes a total of £6,100,000. I commend the Government for setting aside a specific sum for road-safety work. It is essential to have one set of road-safety signs throughout the Commonwealth so that travelling conditions may be made safer and the accident rate reduced.
In making available these sums of money, the Commonwealth Government suggests that it is doing something for the benefit of the States. I point out that this is not the case. Under the uniform tax scheme, the Commonwealth has usurped the power of the States to tax on their own account and has become the sole taxing authority. In fact, this revenue will be contributed by people from all States. The fact that the Commonwealth collects it is merely incidental. In making allocations to the States, the Commonwealth merely returns to them, not all, but a portion of the money collected for the development of roads. I am convinced that the use of these funds on road transport systems will be a means of adding to the real wealth of Australia. The true wealth of the nation comes from its primary industries. The more we encourage prosperity in our primary industries, the more wealth we shall create. Furthermore, in providing good road transport facilities in distant areas, we shall provide a greater inducement for people to settle in them. The bulk of our population of over 7,000,000 persons is congregated in the big cities, chiefly on the eastern seaboard. Good transportation systems constitute an economic factor of first importance to the settlement of our country areas. The Commonwealth Government should have vision and plan a long-range policy of development. Unfortunately, the Labour party obtains most of its support from the large industrial areas. Therefore, its representatives in this Parliament are accustomed more to organizing industry for the greater distribution of wealth than to the creation of wealth. As I have said, our wealth is created chiefly in the wide areas distant from the large cities. The policy which dictated the provision of a three-year term of operation for this bill is short-sighted. An adequate policy of road construction and maintenance could scarcely be put into operation within that period. Therefore, the Government would have been wise to plan for a ten-year period of operation. The fixing of such a period would have enabled the State roads authority to co- operate with local-governing authorities in preparing a long-range plan.
Many miles of dirt roads in the country are gazetted as main roads. These need to be made into all-weather roads so that they will be passable to traffic in all seasons. Also, many rivers, creeks and gullies need to be bridged before we can honestly claim to have a good net-work of roads. The time has come when road transportation is of first-class importance to our country residents. To-day it is possible to transport stock, especially sheep, efficiently and at reasonable cost, in large semi-trailer two-decker vehicles. However, this means of transport can be used only if roads are good and rivers and creeks are properly bridged. Because of their unusual length these large trucks cannot negotiate steep banks and rough gullies. For this reason, it is more important than ever to allocate large sums of money for the improvement of our country roads. By doing so, we shall encourage the development of our potentially wealthy rural areas. Experiencehas shown that transport leads to the development of country districts. Whenever new railways have been constructed, the land adjoining them has been speedily settled.
The construction of good main roads would give residents of outback districts much better opportunities than they have at present to dispose of their stock profitably. By using modern vehicles on good roads, a rail truckload of fat stock can be moved in one day, say 250 miles to a railhead, and placed on the rail for transport to market. Without road transport, drovers would take probably three to five weeks to shift the stock to the railhead over roads on which feed might be scarce. The construction of new roads and the improvement of existing roads would give our pioneers the opportunity to progress which they deserve. The expenditure incurred in such a programme would result in a considerably increased return to the Treasury from our primary producing areas. Farmers would be able to secure more profitable prices for their products. This would be reflected in higher income tax returns. Primary producers would also benefit considerably in times of drought. They would be able to shift their stock more quickly than is possible at present, and thus would be able to reduce the heavy losses which otherwise they must sustain in times of severe drought. Apart from being handicapped by the difficulty of transport over bad roads, country residents have to pay high freight charges for all goods that they consume as well as for products that they send to market. They are hit both ways.
In Queensland, a heavy vehicle tax of 3d. a ton per mile was imposed recently. It applies a charge for the carriage of goods, which is based on the carrying capacity of each vehicle, and a charge of Id. for each passengermile. This heavy duty tax is paid initially by the transport operators, but country residents who must obtain their requirements and send their products to the cities by road, must pay the extra expense in the long run. Naturally the carrier adds the extra cost to his charges. Furthermore, the farther people are removed from the capital cities the higher are the charges which they have to pay. Motor transport is often the only means of transportation available to country dwellers. In addition, they are exploited in having to pay petrol tax on the petrol which they use in running stationary farm machinery. In some years pumping of water by machinery may be a very costly item. Farmers have to pay the tax on petrol used in lighting plants, milking machinery and other necessary equipment, and they receive no benefit whatever in return from that tax. I maintain that the price of petrol should be the same, at least, at all towns on railway lines. When this matter was raised on previous occasions’ it was said that it would be very difficult to fix a universal price, but I point out that there is only one price for sugar in the capital cities, notwithstanding the fact that sugar has to be shipped from Queensland as far away as Perth. The cost of transportation is borne by the industry, and sugar is sold at the same price in Perth as it is in Brisbane. I see no reason why the same arrangements should not be made in respect of the selling price of petrol, and I believe that if the Government gave the matter earnest and sympathetic consideration some plan could be evolved at least, so far as towns on railway lines are concerned, to overcome the difficulty.
It has been said that more money has been granted for road construction and maintenance than was provided in 1939. That is true, but this is a progressive age. The more petrol we use the greater will be the amount available for expenditure on the construction and maintenance of main roads. Costs of construction and maintenance are now much higher than they were in 1939, and more could be done with the amount available then than can be achieved with the sum provided at present. The price of bitumen, which is used extensively in the construction of roads, has increased from £20 a ton to approximately £80 a ton. We must admit that local authorities, on whom a great deal of responsibility for road construction and maintenance rests, have not been able to procure the necessary plant to carry out their work. During the war years they supplied engineers staffs and plant for war purposes, and their men who came from all States of the Commonwealth, did a very fine job. The plant and machinery which the local authorities, and particularly those in Queensland, had acquired over the years were requisitioned and used for war purposes, and in fairness to those bodies we must realize that they are experiencing great difficulty in getting suitable machinery to replace their plant. Such new plant as is available for purchase costs a great deal more than the plant which the Government requisitioned from them during the war. Nor has any concession been made in respect of the transportation of road-making machinery to inland centres. That concession should be extended to local authorities because most of them are barely able to afford the cost of new plant. They are dependent on the income from rates, and they find it practically impossible to carry out any long-range plan of construction or maintenance because of depletion of their funds and the high cost of new plant. In addition, they are confronted with the task of repairing the damage done to their roads during the war. Naturally they were not able to maintain their roads in proper repair, with the result that most of them have deteriorated seriously. This applies particularly to local-government bodies in Queensland,’ because during the war that State became the forward area for our own and allied troops. I consider that shire councils should receive some compensation for damage done to their roads. They have a good case, because compensation has been paid for war damage to dwellings and other buildings, and I contend that they should be similarly treated. The money is available from the proceeds of the petrol tax. Approximately £10,000,000 will be collected this year over and above the sum to be spent on maintenance and construction of main roads. Of course, the railways also did a fine job during the war, and they had to carry on with locomotives and rollingstock sadly in need of repair. Whilst they accomplished a great deal, particularly in shifting heavy machinery, a great number of troops and lighter war material of all kinds were transported by road. It is true that a large number of long defence highways built during the war have been handed over to local authorities, but, on the other hand, the cost of maintaining them is too great for those bodies to bear. Some of the roads were constructed in sparsely-settled country and may be of great advantage in opening up new areas, but it would be a great pity if those roads should be allowed to fall into disrepair because shire councils have not sufficient funds to maintain them. Under present conditions it is impossible to expect local-government bodies in sparsely-populated areas to maintain the roads in the condition in which they should be maintained.- This bill, admittedly, provides for the sum of £500,000 to be spent on the maintenance of such strategic roads throughout the Commonwealth, but that amount is not sufficient to maintain the thousands of miles of roads built as defence highways. I doubt whether the sum of £500,000 would provide £15 a mile to spend on maintenance. Honorable senators will agree that that is only a fraction of the amount needed to maintain them properly. The aggregate sum which is being allocated, namely, £6,100,000, is not sufficient, and my contention is borne out by State representatives at the Australian Transport Advisory Council meeting held in Melbourne on Monday last. Press reports of that meeting say that State representatives pointed out that great damage was. done to roads during the war and that machinery which would otherwise have been available to repair them has been worn out and cannot be replaced at anything like pre-war cost. Considering the surplus of £43,000,000 anticipated by the Treasurer for the current financial year, and also the fact that the amount of £10,000,000 derived from the petrol tax is to be paid into Consolidated Revenue, this measure is anything but generous. The Commonwealth can afford to be much more generous in this matter, because, as I said in my opening remarks, a system of firstclass roads will serve to develop our back country. We must do everything to attract new settlers there, because it is in the country that the wealth of Australa is really produced. Any money expended in the development of those resources will be a good investment, and the expenditure will be returned many times to the Treasury in numerous indirect ways, particularly through an increase of the national wealth. One-sixth of the sum of £4,500,000 to be specifically allocated for road construction and maintenance may be used for the development of country aerodromes and aviation facilities. As collections of petrol tax on spirit used for aviation purposes is paid into a separate fund, this work should be financed from that fund, and not, as is proposed under this measure, from collections of tax imposed on petrol used by motor users. It is most important, of course, that country aerodromes and aviation facilities be developed as fully as possible. That is a link in our general development scheme. First. we must provide a first-class system of roads for transport by motor vehicles of heavy goods to rail heads. Then we require fast air services for the transport of passengers, lighter goods and mail. Therefore, it is essential that country aerodromes be developed to supplement our main aerodromes on the coast. If it is proper to utilize collections of tax on aviation spirit for the development of large city aerodromes it is equally proper to use that fund to finance the construction of aerodromes in the country.
I strongly support the proposal under the bill to provide financial assistance to the fishing industry. . Those engaged in that industry use a certain amount of petrol, but unless better facilities, such as beacons on fishing grounds, up-to-date jetties and havens are provided, they will receive no benefit whatever from their contributions of tax. That is a very wise provision.
In this country, with its great distances, we must undertake a long-range plan for the construction of permanent all-weather roads. I hope that the Minister will consider the points which I have made, and ensure that a greater sum of money shall be made available for the purposes I have mentioned. Such expenditure will prove to be a sound investment. It will yield valuable direct and indirect benefits to the community as a whole.
.- We always welcome a measure which provides special financial assistance to the States in order to enable them to carry on their particular activities. Therefore, we welcome this bill, under which approximately £1,750,000 more will be made available to the States than was provided for them in 1939. The total sum involved under the measure is £6,100,000, and of that amount £4,500,000 is to be allocated to the States. I should like an assurance that that money will be allocated on an equitable basis. I understand that Tasmania will receive 5 per cent, of that amount. In deciding the allocation to Tasmania consideration should be given to the peculiar position of that State so far as transport is concerned. Tasmania depends upon road transport to a greater degree than any other State, and this tendency will be more pronounced in the future because the railways in Tasmania are practically becoming a back number. I do not think that the day is far distant when the Tasmanian railways will not be used for passenger transport at all. Indeed, I believe that Tasmania would be wise to abandon its railway system altogether, because it is now losing money at the rate of £1,000 a day. That money could bo more profitably invested in the development of an up-to-date road system throughout the State.
I am particularly concerned about the supervision of this expenditure in the various States. We have in existence at i;resent an Australian Transport Ad visory Council. The Minister for Munitions (Senator Armstrong), in his secondreading speech, said -
It is proposed that the States will be required to submit to the Commonwealth Minister for Transport each year a statement on a broad basis of proposed allocations of expenditure on road construction works for the following financial year and that these statements will be referred to the Australian Transport Advisory Council for its information.
I should like the Minister to clarify that passage. If the statements of allocations are to be submitted to the council merely for its information, I have no complaint; but I shall object to any proposal that the council shall investigate such allocations before this money can be expended. The council consists of a representative of the Commonwealth and each of the States; but no one knows) better than- each transport authority the requirements of its State. Each State transport authority is best able to decide how and where the money can be expended to the best advantage. I shall strongly object if it be intended that the Transport Advisory Council shall determine where the money shall be expended. That would infringe State authority. A Minister of the Tasmanian Government has said publicly that this bill will be of very little use to the States because the Transport Advisory Council will finally determine where the money is to be expended. In fact, he claimed that the State transport authority would be denied the right to say what roads shall he constructed under this scheme. I do not know whether that statement is correct. If it is not correct, I ask the Minister to refute it.
Under this measure the sum of £1,000,000 is to be set aside specifically for the construction of feeder roads and will be made available direct to local government bodies. Is it intended that each local government body in each State shall submit is claims to the Transport Advisory Council, or to the State transport authority, and should the latter be the case, will the recommendation of that authority to the council be confirmed? I should like the Minister to clarify that matter in view of the conflicting statements that have been made in that respect. I wish to know clearly what part the Transport Advisory Council will play in deciding where this money is to be expended. In Tasmania, no local government body constructs a road in the first instance. That work is done exclusively by the State government, which hands over the road to the local government authority. Of course, the main roads are constructed by the Main Roads Board. I also wish to know whether Tasmania’s share of the sum of £1,000,000 is to be made available direct to local-government bodies, or will it be handed to the State governments? Will the latter determine where the money shall be expended?
A sum of £500,000 is to be allocated for the construction and maintenance of arterial roads throughout the Commonwealth which do not come under State control. I believe that that amount will prove to be inadequate for the purpose in view. During the war the Commonwealth expended many millions of pounds in constructing roads for defence purposes, particularly in northern Australia. No State government would have contemplated building those roads probably for another 50 years. However, those roads form an essential link in any plan for the defence of this country, and they will play an important part in the development of Australia. Probably, more of those roads will have to be constructed by the Commonwealth. The cost of maintaining them will be subs’ antial. Therefore, the Government would be wise to allocate a greater amount for that purpose. Perhaps the Government may be making provision in that respect in some other way. However, it is the Commonwealth’s responsibility to ensure that those roads shall be maintained in first-class order. I sincerely hope that it will spare no effort, or expense, in order to ensure that, should we require to utilize those roads for defence purposes in the future, we shall be able to do so without delay. Should the Commonwealth fail to give special attention to those roads, they will rapidly deteriorate to such a degree that, should an emergency arise in the future, we shall be confronted with a grave problem in making good that deficiency. That plan, of course, will not directly affect Tasmania ; but I should like to know whether Tasmania will receive 5 -per cent, of the amount of £500,000 to be allocated under that heading. The Minister, in his secondreading speech, said that Tasmania would receive its quota on the basis of the total amount to be allocated under the measure. Perhaps he can clear up that point.
In reply to Senator Cooper, I point out that it has remained for this Government, under this measure, to provide the largest amount from petrol tax collections for the specific purpose of road construction and maintenance. I remind him that in 1936 the government which- he supported made available to the States for this purpose an amount of only £2,778,899.
– But it was allocated on the same basis of 3d. a gallon.
– In 1937-38 the Government which the honorable senator supported made available for road construction to the States an amount of only £4,449,000.
– That grant was made in order to relieve conditions during the depression.
– -According to the honorable senator, the depression extended from 1931-32 to 1938-39. During practically the whole of that period a non-Labour government was in office in this Parliament. The honorable senator implies, apparently, that those governments used the collections of petrol tax to tide them over the depression. That showed the incompetence of the government of the day. I ask leave to continue my remarks later.
Leave granted ; debate adjourned.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Ashley) read a first time.
.- I move-
That the bill be now read a second time.
In this bill appropriation is sought for a grant of £25,000,000 to the United Kingdom Government as a contribution towards costs of war incurred by it in the Pacific zone. The United Kingdom is labouring under great difficulties to-day because in the war it fought with unwavering will the battles of many other peoples as well as its own. The military side of the story is fresh in our minds, but it may be that the economic aspects of Britain’s war effort, which are no less important and are now so much to the fore, are not so fully comprehended, and the further sacrifices that are necessary for its complete recovery are not realized. Britain’s economy was mobilized and maintained at the pitch of a total effort so long as the war lasted and, indeed, with only gradual diminution, for many months afterwards. That country’s efforts, however, went a great deal further. Britain organized and bore a large part of the cost of campaigns in which the forces of other nations were engaged. Its strategic responsibilities were immense and far exceeded its own current resources. To meet the cost Britain drew heavily upon its external assets and pledged its future wealth and earnings. As a result, £1,500,000,000 sterling of Britain’s international investments were realized for war purposes and in addition the United Kingdom incurred new external liabilities amounting to £3,500,000,000 sterling in the prosecution of the war. Thus Britain suffered a deterioration in its external capital account of £5,000,000,000 sterling.
In order to tide over the needs of the transition period Britain had to raise credits from the United States of America and Canada amounting to £1,250,000,000 sterling. Meanwhile its homes and industries had suffered from enemy bombing, its shipping fleet had dwindled and its export trade, already sacrificed to permit full concentration upon war industries, had been reduced to one-third of the prewar volume. We in Australia put forth a full-scale war effort, but we suffered no loss of external wealth, and on balance we incurred no external liabilities. In fact, our position in that respect is more favorable to-day than it was before the war. Whilst we still have some war accounts to settle with the United Kingdom, our London funds, after providing for those debts are considerably higher than in 1939. Moreover, we were able during the war to reduce our London debt by £00,000,000 sterling. This improvement has come about partly because nonessential imports were curtailed, partly from substantial lend-lease aid from the United’ States of America, and partly because cash expenditure by United States forces in Australia contributed more than £100,000,000 sterling to Australia’s external funds. The United Kingdom is, in fact, the only member of the United Nations to emerge from the war heavily burdened with external war debts. The latest estimate places these debts at about £3,500,000,000 sterling. That amount is owed to a. number of countries - some within the sterling area and some outside - to which the United Kingdom made payments in sterling for local currencies for payment of the forces, war purchases and other services in the several countries.
Under the Financial Agreement with the United States of America the “ line of credit “ of 3,750,000,000 dollars is intended mainly to aid Great Britain in its post-war recovery and to assist it in the resumption of normal multilateral trade.
The money is being expended in the United States of America on goods and services which Britain needs. Other countries also will benefit insofar as their sterling balances are convertible into dollars. No interest or principal is repayable until 1951, so that Great Britain will get a short breathing space. On the other hand, the external war debts of Great Britain, amounting to £3,500,000,000 sterling are an immediate problem. They have gravely disturbed the economic balance. The discharge of these debts in the near future by exports or conversions to other currencies is impossible. Even spread over a very long period, they would impose a crippling burden. In the meantime, the liquid form of the balances is embarrassing. It is essential, therefore, for Great Britain to make some arrangement with the holders of these balances. The United States of America made a generous lendlease settlement and is giving further assistance under the loan agreement to Great Britain to aid its recovery. It is reasonable that other countries, including the Dominions, should make some contribution from their own war accumulation of sterling balances. Although Australia is not a large holder of sterling, this country did derive a net benefit to its external position during the war, partly by repatriation of sterling debt .and partly by some increase of our balances which at the end of the war. stood at approximately £120,000,000 sterling, and are now about £170,000,000 sterling. That sum has, however, to be considered in the light of large arrears of import requirements due to war-time shortages, and an increase of over 80 per cent, in import prices.
When the Prime Minister (Mr. Chifley) was in London last year he discussed with the British Chancellor of the Exchequer the matter of assistance from Australia, and later it was considered in Cabinet. After full consideration, the (Government decided that the most appropriate method of assistance to the external war debts problem of the United Kingdom would be to make an outright contribution of £A.25,000,000. It is proposed to make this contribution towards war costs incurred by the British Government in and around the Pacific. It has been suggested that we should do better by making a gift to the United Kingdom of food and other commodities to the value of £25,000,000. There is no real issue here. Australia is already sending all available food to Great Britain. The only way to increase these exports would be to intensify food rationing drastically. A gift of food would not increase the quantity reaching the United Kingdom. It would, in effect, do exactly what the Government proposes - that is, make a money gift. The form of gift as proposed in this bill is, in all the circumstances, the most appropriate. I am confident therefore, that honorable senators will readily approve this gift, and that they will wish it to go forward as a practical expression not only of gratitude to the United Kingdom and her people but also of our proud confidence in them.
Debate (on motion by Senator Cooper) adjourned.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Ashley) read a first time.
.- I move -
That the bill be now read a second time.
The bill which I am now presenting to the Senate is in the nature of a machinery measure but the matter is of importance to those who are or will be employed by the National University. Under section 27 (t) of the Australian National University Act provision was to be made for “ a scheme of superannuation “. The interim council of the University has found from its early experience that more than one arrangement for superannuation will, however, be required. The council finds that most, if not all, of its academic and scientific staff will be covered by what is known as the F.S.S.U. - Federated Superannuation ‘Scheme for Universities - a British and Australian scheme evolved by the universities and a group of insurance bodies to which most scholars and scientists coming to the National University will already belong and will wish to continue to belong. At the same time, the office and administrative staff and some of the technical staff cannot be provided for under that scheme. It is proposed that they should come under the Commonwealth Public Service Superannuation Scheme. Provision will be made under the Superannuation Act 1922-1947 for the National University to be proclaimed an approved authority for the purposes of that act, and members of the staff of the university to come under that act will be gazetted from time to time. This, incidentally, will enable any member of the Commonwealth Public Service who joins the office or other staff of the National University to continue unbroken his membership of the Commonwealth superannuation scheme. The sole purpose of the present amending bill
Is to permit the necessary dual superannuation arrangement to be made by the National University whereby all members of its staff can be covered.
Debate (on motion by Senator Cooper) adjourned.
Debate resumed (vide page 2970).
– Senator Cooper claimed that the petrol tax was a sectional impost. Whilst that may be. true, it cannot be denied that the section excluded from the payment of this tax, either directly or indirectly, is very small. It would be most difficult to find anybody who is not a private motor car owner or a user of public motor transport, or the airways. Senator Cooper also said that the motor lorry driver was the principal contributor of the tax, but I contest that argument. The commercial truck-driver takes into consideration all his running costs, including tyres, petrol, repairs and replacements, in fixing his charges, and so passes them on to the public. It is not he, therefore, who is the principal sufferer under this legislation. The only person who really suffers is the man who uses his own private car for business purposes. He cannot pass the tax on. The private motorist who drives for pleasure can cut down that pleasure if he believes that it is costing him too much. I deny, therefore, that the petrol tax can be regarded as a sectional levy.
Another complaint made by Senator Cooper was that the proportion of revenue allocated for the construction and maintenance of country aerodromes was insufficient. I fail to see the validity of that argument. After all, it is the Commonwealth Government that builds, nol only city aerodromes, but also country aerodromes, and it must have funds for this purpose. I doubt very much whether, .after the allocations have been made to the States, the revenue derived from the petrol tax remaining with the Commonwealth will be anything like sufficient for the construction of all the aerodromes that the Government has planned for our country areas. In addi tion to what the Commonwealth expends in this direction, the State governments may expend one-sixth of their grant on the improvement of country aerodromes and of roads of access to those aerodromes. Few country aerodromes have not been taken over by the Commonwealth Government. Therefore, the onesixth that can be expended by the States out of the money allocated to them will be in addition to whatever expenditure to which the Commonwealth Government is committed. It is true that enormous runways are required only at city aerodromes for the heavy transport planes of the future, but country aerodromes from one end of Australia to the other are being built or extended to take Douglas aircraft which are by no means small. This work can only be undertaken out of Commonwealth funds, and to carry it out I have no doubt that the Commonwealth will require much more revenue than that provided by the petrol tax on aviation spirit. I remind the Minister that I should like it made clear just where the investigation of the roads that are to be built and maintained out of allocations to the States will start and finish. Will the Transport Advisory Council dominate the States or will it merely endorse the recommendations made to it by the State authorities which, after all, are the only authorities in a position to know what roads would be of greatest benefit to the States and to the Commonwealth as a whole.
– Western Australia is very much concerned with the future of the Commonwealth Aid Roads and Works programme. Recently I asked a question in this chamber in an endeavour to induce the Minister for Supply and Shipping (Senator Ashley) to postpone the introduction of this measure into the Senate in view of representations made by the new State Premier of Western Australia, the Honorable Ross McClarty. The Minister said that I was rather late in making the request because the bill was about to be received from the House of Representatives. Unfortunately the letter that was sent to me from the State government was addressed to “ The Honorable A. N. McDonald “, without the usual title “ Senator “, with the result that it went to my namesake in the House of Representatives, thus delaying its delivery to me. It is not often that I am charged with being dilatory in attending to such matters.
The purport of this bill is to continue, with certain amendments, what was known as the Federal Aid Roads Agreement, which, as Senator Cooper has pointed out, was introduced by the BrucePage Government in 1926. The then Treasurer, the right honorable member for Cowper (Sir Earle Page) was severely criticized by sections of the Australian press for, amongst other things, inaugurating what was termed a system of speedways over which motor cyclists could take their “ flappers “ for joy rides on the pillion seat. Sir Earle Page took the long view, and his policy was proved to be correct eventually, as is often the case with decisions made by statesmen who take a long view. I shudder to think of what would have happened within Australia during the recent war if those arterial roads had not been laid down then. The task of constructing them under war-time conditions would have been stupendous. The policy of the BrucePage Government revolutionized the building of main and arterial roads in all States, and no State was more greatly affected than Western Australia. The programme is now to be continued. The present agreement will expire at the end of next month, and the Government will implement its new policy as from the 1st July. According to the Minister for Supply and Shipping, the bill covers four distinct items. The first item is the appropriation of approximately £4,500,000 for distribution amongst the States. The second is the appropriation of £1.000,000 for the special purpose of building and maintaining roads in sparsely-settled areas. The third is the provision for £500,000 per annum to be expended on the maintenance of certain strategic roads and roads of access to Commonwealth properties. The fourth is an appropriation of £100,000 for the promotion of road safety principles and practices. All of these items are urgent and highly desirable.
T commend the Government for undertaking the continuation of the agreement, which has been of Treat benefit to every
State. The bill has one main fault, namely, its term of operation of three years. This period is too brief. Representations have been made to the Government from various sources in an endeavour to have the currency of the bill extended to ten years. I, too, urge it to reconsider its decision on this point That is the main reason why last week I asked that the introduction of the bill be deferred until the Government had time to reconsider the position. Unfortunately, the Government did not accede to my request. The main reason why Western Australians consider that the three-years term is totally inappropriate is that, owing to the scattered nature of communities in that State, much of the work to be done on isolated roads will have to be carried out in association with local-governing authorities. In Western Australia these are known as roads boards. In some instances the boards will have to raise- funds on loan for the carrying out of this roads policy. For the State Government to suggest that these authorities should raise loans for this purpose on a threeyears basis would be not only inappropriate but also rather stupid. No community in Australia could bear the sinkingfund charge that would be necessary in order to redeem a loan of this character, even though the roads constructed could be termed semi-permanent. In fact, ten years would be too brief a period for the redemption of such debts. That is why I support the Premier of Western Australia, in asking the Government to extend the period of the agreement from three years to ten years. I know that the bill contains provision for the review and reconsideration of the agreement at the end of three years. However, as I have said, no local-governing authority would undertake the task of raising finance for these road works by means of a loan which would have to be redeemed within three years. The sinking-fund charge would be much too high, having regard to the amount of money involved and the benefit that would accrue to the community. I again urge the Government to extend the period to ten years.
The Premier of Western Australia also takes exception to tho trend of the proposed agreement, which indicates that the Commonwealth may impose its overriding authority upon the road policies of the various State governments. I agree with him in this respect also. No matter how enthusiastic or efficient the central Commonwealth authority may be, the fact is that local conditions in the various States will be better understood by the respective State departments. I have no quarrel with the Government regarding the appropriation of £500,000 for roads in Commonwealth territory. That is a domestic matter for the Commonwealth. However, in relation particularly to isolated areas off the main track in Western Australia, I consider that the State Minister in charge of road transport should have a greater degree of freedom than is contemplated in the bill in framing plans for the construction of arterial roads. The Commonwealth Government would be well advised to have regard for the points raised by the Premier of Western Australia in this respect.
I have traversed briefly my main criticisms of the measure. In itself the bill is fundamentally sound. This policy of - road construction, which was inaugurated in 1926 by the Bruce-Page Government, has been of inestimable benefit to the road users of Australia. A significant feature of the scheme during the early years of its operation in Western Australia was the condition attached to the agreement between the Commonwealth and the States at that time that area as well as population should influence distribution of these funds. The smaller States, numerically speaking, such as South Australia, Tasmania and Western Australia, had previously suffered considerably in the distribution of largesse by the Commonwealth on account of the sparse nature of their populations. The population-cum-area system represented a new departure by the Commonwealth. The government of those days made a serious blunder; which this Government also intends to perpetrate. It interfered too much with the road-construction programmes of the States. However, after a brief trial, it relinquished a large share of its influence at the meetings of the interstate transport advisory body in 1927, and allowed the States to develop their domestic policies without hindrance. That was an historic development. I agree with the Premier of Western Australia that the Government would be well advised to allow the States to pursue their own policies in relation to roads without undue interference from the Commonwealth Minister, for Transport or any of his officials. With the few exceptions that I have stated, I commend the bill and also the Government for having introduced it.
.- This bill will effect a departure from previous Federal Aid Roads Agreements. It proposes to grant to the States, from Consolidated Revenue, moneys for the construction, reconstruction, and repair of roads, for works connected with transport and for other purposes. Previously each State had to contribute on the basis of 15s. in every £1 from its own revenue, and, in addition, legislative action had to be taken by each State before the agreement could be implemented. Under this measure money will be handed over to the States in the form of grants. There will be no obligation on the States to contribute at all. I understand that the States may contribute if they so desire, but that there is no obligation on them to do so. When it is remembered that this proposal is to take effect as from the 1st July next, it will be realized that there will be no delay in implementing the proposals because there will be no necessity for the enactment of State legislation. Under this bill the Commonwealth is to make available to the States certain moneys each year during a period of three years, without any strings so far as the States are concerned, except that they will be required to assume responsibility as the constructing and supervising agents of the Commonwealth. When it is suggested that the Minister for Transport will have the sole right of determination in regard to States’ proposals, it should be realized that there is an Australian Transport Advisory Council, whose function is to plan on a nation-wide basis. On that Council each State is represented by its Minister for Transport, so that any decisions made by the Minister for Transport are reached only after consultation with the Australian Transport Advisory Council.
States have the right and the opportunity to bring before that council any matters affecting their interests, and the bill provides that, prior to the 30th June each year, States must place before the council their requirements for the succeeding twelve months. For those reasons I consider that the suggestion that this bill constitutes an interference with State autonomy is unwarranted.
With regard to the payment of money to the States, some concern has been expressed that the abridgment of the period in which the money is to be paid from ten to three years may have a detrimental effect on States’ roads plans, lt is suggested, for instance, in regard to Western Australia, where most of the roads are under the control of localgovernment bodies, that it is unfair to expect road constructional ‘ authorities to expend large sums of money on the purchase of expensive machinery when there is no guarantee that the grant will be continued after three years. But this bill provides that at the end of three years the whole matter is to be reviewed, and I do not believe that this Government would depart from the practice of making large grants of money to the States for this essential work.
Another factor which must be borne in mind is the need to plan road construction on a national rather than on a State basis. Provision must be made for the construction of strategic roads in the event of war, and whilst this bill requires the States to submit their plans to the Austraiian Transport Advisory Council for approval I do not think that that can he regarded as adversely affecting their plans. Under that arrangement the States will know exactly what amounts it re available to them from year to year, and that should be of considerable assistance in preparing their construction programmes. Whether the amount of the grants is to he increased or decreased I do not know, but the new method proposed by this bill for financing States’ road construction seems to me to be fundamentally sound, and I cannot see that it will he disadvantageous to the States.
With regard to the proposed establishment of a trust fund from the proceeds of the tax of 3d. per gallon on petrol and coal tar distillates from which grants will be made to the States, the schedule to the bill shows clearly the various fuels which will be subject to the tax. I understand that the imposition of the present tax of 3d. a gallon will result in a payment to Western Australia of £864,000 on the basis of its present consumption of petrol. If the consumption of petrol increases, the amount of the grant will be increased accordingly, and the amount of the grant is to be reviewed during the period of operation of this plan.
The bill provides that petrol for civil aviation use shall be exempted from payment of the tax. In the light of the development of civil aviation, not only in this country but all over the world, I think that all honorable senators will agree that that provision is justified, particularly when we recall that the Government is at this moment faced with a tremendous capital outlay in connexion with the construction of the Essendon aerodrome. In addition, another large aerodrome has recently been constructed in Western Australia. The necessity for thu provision of aerodromes and adequate facilities throughout the Commonwealth is increasing, and if we are to fulfil these requirements we must not do anything to discourage the development of civil aviation.
So far as the States are concerned the distribution of Commonwealth funds by grants will not involve any deviation from existing practice. Tasmania is to receive 5 per cent, of the total proceeds of the tax, and the remaining 95 per cent, is to be divided between the other .States on the basis that three-fifths of their grant will be calculated on their population and two-fifths on their area. The bill also provides that a sum of £100,000 is to be made available to the States for construction of roads through sparsely populated areas. This will be a great advantage to Western Australia, and it is anticipated that from the distribution of this sum £192,000 will be received by that State. In Western Australia roads boards have to construct and maintain roads over tremendous areas, and for that purpose they receive only a small income from rates, with the result that they find it almost impossible to carry out a programme. The payment of this large sum to the States will be of tremendous value to them, and I think that all road conducting bodies will appreciate it. 1 am pleased with the provision in the bill to make available the sum of £100,000 for the promotion of road safety. I know that in Western Australia the National Safety Council was recently resuscitated for the purpose of educating pedestrians and motorists in an endeavour to reduce the tragic loss of life through road accidents, and it is gratifying to note that the Commonwealth is making specific provision to overcome the toll of the road. As one who has travelled extensively in Western Australia, I say that the roads boards have done a very fine job. Some excellent roads have been provided, but there is still a great deal to do. The roads boards have .been able to accomplish what they have achieved because of the provision of Commonwealth money, and under this bill they will receive greater sums of money from the Commonwealth. Local authorities in Western Australia suffered greatly from damage to their roads caused by heavy transport during the war. They have endeavoured to obtain compensation in that respect, but in many cases unsuccessfully. Senator Cooper has pointed to the advantages resulting from the operation of heavy trailers capable of carrying two tiers of sheep. However, those heavy vehicles are causing more damage to roads than most people believe, and they are involving the roads boards and municipalities in very heavy expenditure. Senator Cooper also said that the Government could be far more generous towards the States. When we take into consideration our transport economy as a whole, and remember the heavy capital expenditure incurred by various governments in the provision of railways, which to-day have to compete with heavy road transport on roads also provided by the taxpayers, road-users have no real objection to paying the petrol tax provided they receive good value for that money in the form of first-claps roads. The bill will be in the best interests of the country, and, therefore, I support it.
– I do not propose to speak at length on this measure. The Commonwealth and State governments have consistently advocated land settlement ; but we can no more hope to induce settlers to open up the back country unless we provide serviceable roads than we can induce farmers to undertake primary production in areas where no water is available. Nothing is more helpful to a farmer than a good road, which will enable him to transport his produce to market. Senator Nash and I have travelled throughout Western Australia. We found the roads generally in a fair state. Unfortunately, during the war, heavy military trucks caused considerable damage to roads, and all roads boards found it beyond their means to maintain their roads in first-class order, let alone construct new ones. In Western Australia, during the war, the Commonwealth also constructed several roads to serve important aerodromes. Those roads will now be maintained by local roads boards. However, they have been handed over in a bad condition. I have in mind, in particular, the road to Northam. During the war I made repeated representations to the then Minister for the Army to provide financial assistance to the local main roads board for the maintenance of that road. Nothing makes so bad an impression upon visitors to a State than bad roads. Prior to the war the roads generally in Western Australia were in fair condition, but heavy military traffic damaged them considerably. I agree with Senator Cooper that we shall not foster primary production unless we provide first-class roads in country areas. The roads in some districts, however, are so bad that they involve farmers in direct financial loss. For instance, a farmer at Kalamunda told me that very often he would lose a lot of his eggs through being broken while being transported over a bad road. Primary producers cannot be expected to carry on under such conditions. This is a very grave problem in Western Australia, because in that State the roads are longer than those in any other State. I support the bill.
. - in reply - I thank honorable senators for the reception that they have given to the bill. I thank, particularly, those who have commended the bill, and also those who have offered helpful criticism. Due to inadvertence in addressing the envelope containing the communication which Senator Allan M.acDonald had received from the Premier of Western Australia, the Government received that communication at too late a stage to be able to accede to his request for a postponement of the bill.
Senator Cooper generally commended the bill, as all thinking people do; but be also directed a number of criticisms which I was pleased to hear, although I do not agree with the honorable member in respect of all of them. However, it is always helpful to hear the other man’s point of view. He complained about the great increase of collections of the petrol tax over the years. People associated with the motor trades and the petrol industry are not the only sections of the community that can complain of heavy taxation. That is a complaint which can he justly made by every section of the people. Even members of Parliament are vocal in their complaints’ about the increase in taxation over the years. I am afraid that I cannot offer Senator Cooper any consolation in that direction. He also said that the amount proposed to be allocated under the measure was not sufficient for the objective in view. He then objected to the operation of this measure for a period of only three years. He will find the answer to both those complaints by taking those two observations together. The reason for fixing the period of throe years is that the Commonwealth realv.es that the States will have available for road construction and maintenance, not only the money to be made available to them under this measure, but also money that they have been able to place in reserve during the war when they were unable to undertake this work. The Government will review these proposals at the end of the period mentioned. We. realize that one of the basic requirements of the nation’s economy is a system of first-class* roads, and we shall do all we can to develop and maintain our roads generally in first-class order. As Senator Nash mentioned, the Common- wealth is just as anxious as the States to review these proposals at the end of the period of three years. Senator Allan MacDonald objected to that period for a different reason. He said that the main roads board in Western Austrafia could not borrow on the basis of a threeyear period and suggested, therefore, that it would not be able to operate effectively. The honorable senator appears to have missed the point in that respect. The Commonwealth has no intention of interfering with borrowing by local main roads boards, or State governments, in this sphere. Financial assistance from petrol tax collections is not the only money available to the States for road construction and maintenance. The States have other sources of revenue for that purpose. In New South Wales, for instance, considerable revenue is derived from motor vehicle registration fees and drivers’ licences, &c, and that money is devoted to road construction and maintenance. I understand that for every £2 which New South Wales received in 1939 from the Commonwealth from collections of petrol tax, it borrowed £1 on the loan market for this purpose. There is no intention that road construction and maintenance shall be financed solely from this fund. That has not been the practice in the past, and it will not be the practice in the future. Therefore, borrowing by main roads boards will not be interfered with so long as they are permitted by their respective State governments to borrow money for this purpose.
I am pleased that Senator Cooper was able to congratulate the Government on the safety measure proposals contained in this bill. It is hoped that the toll of life and property caused bv road accidents will be reduced because of the wise expenditure of the £100,000 that is being made available for that purpose.
The honorable senator also urged that the price of petrol should be the same throughout the Commonwealth, but I am afraid that is a matter outside the scope of this bill. His suggestion, however, will be given consideration. He also asked that the shire councils should be compensated for damage to roads caused by military vehicles. That matter is under consideration by the Government, and it is hoped that in cases in which it can be proved that the damage was caused by vehicles engaged in defence measures something will be done. The honorable senator also desires that the revenue derived from the tax on aviation spirit shall be expended on aerodromes, but as Senator Aylett pointed out the development of civil aviation would require an expenditure of £10,000,000 rather than £1,000,000 per annum. The same argument applies to roads. It is not fair to say that the Government collects £16,000,000 a year from the petrol tax and pays to the States only £6,000,000, retaining £10,000,000 in Commonwealth consolidated revenue. I point out that many roads on which motor vehicles travel were constructed before there was any petrol tax. This bill seeks to meet the needs of the next three years. The States admit that they cannot expend large sums on roads at the present time. I emphasise that after three years the position will again be reviewed.
Senator Aylett referred to Tasmania’s roads problem. He said that that State was particularly dependent on road transport, and that, therefore, the grant to it should be increased. I remind him that 5 per cent. of the receipts from the tax will be a considerable sum. From what I have gathered, there is general satisfaction in Tasmania regarding the amount to be made available to that State. The honorable senator also desires to know whether the Tasmanian authorities will be able to expend the money made available to that State without reference to the Commonwealth Government. Senator Allan MacDonald also spoke in similar term’s. I admit that there is a small string attached to these grants. That is because the Commonwealth desires to know what is being done, so that roads may be planned on a national basis. It is important that no State shall build roads without regard to the programme of adjoining States. The transport authorities should know what is being done in every part of Australia. The purpose underlying the bill is that the States shall comply with a broad policy in order that a truly national roads programme shall be maintained. The honorablesenator also asked if Tasmania would share at the rate of 5 per cent. in the £500,000 to be expended on strategic roads and roads serving Commonwealth property. The answer is that Tasmania will not share in that vote. The money will be expended not at the direction of any one State, but under the advice of the military authorities.
I have endeavoured to answer the points raised during the second-reading debate. In summing up, I remind the Senate that out of the yield from the petrol tax, the Commonwealth proposes to pay £4,500,000 to the States for general main roads work, and in addition, £1,000,000 for special purpose roads in sparsely settled areas, including timber country and districts in which other transport is not available, as well as £500,000 for the maintenance of strategic roads and roads of access to Commonwealth property, and £100,000 a year for a roads safety campaign. The grand total, £6,100,000 a year, compares favourably with the average expenditure of £3,800,000 for the three years before the outbreak of war, and the average of £2,900,000 a year between 1930 and 1940. It will be seen that there has been considerable progress since 1930. I assure the Senate that in three years’ time, the Government will be willing to take further steps to provide the roads which are so vital for the development of Australia.
Question resolved in the affirmative.
Bill read a second time.
– Clause 6 provides, in paragraph b of sub-clause 3, that payments to a State shall be subject to the condition that the amount expended by a State shall be expended in accordance with a policy agreed to by the Minister. I should like to know whether the Commonwealth Government will require from the States details as to how the money shall be expended even in cases in which a State Government considers that the proposals in respect of expenditure on roads are reasonable.I desire that information because it has been said that the Commonwealth proposes to tie the States down by requiring them to expend the money on particular roads, thus making the States no longer free agents.
– The honorable senator need have no fears on that score. As I mentioned when replying to the second-reading debate, the purpose of this provision is that the Commonwealth Government shall be supplied with information necessary to coordinate the programmes of the several States. That is important from a national point of view.
– I agree.
– I assure the honorable senator that there will be no interference with the States in matters of detail.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Motion (by Senator Ashley) proposed -
That the Senate do now adjourn.
– About two weeks ago, I criticized the Australian manufacturers of smoking pipes. I still think that my criticism was justified, but local manufacturers who consider that my statements were uncalled for have endeavoured to enlighten me as to what is being done in the various States. The result is that I have visited two factories where smoking pipes are manufactured, and have received from manufacturers in South Australia and Victoria, samples of the pipes made by them. I now find that pipes of much better quality than those that I have been able to purchase are being made in this country. It would appear that it is not so much a matter of the quality of some of the smoking pipes made, as one of distribution. T was informed by the proprietor of an establishment in New South Wales which employs 40 hands that the output of his establishment is approximately 3,000 dozen smoking pipes a month, and that a high percentage of that output consists of good briar pipes many of which were made from local woods, and that the balance . consists of pipes of inferior quality for use by natives in the Pacific islands. Hie informed me that he was as much in the dark as I was regarding the destination of the pipes manufactured by him, because he rarely saw any of them in Sydney shops.It would appear that a large proportion of the output of Australian factories is exported, possibly to New Zealand, Indonesia, Malaya and other countries with the object of capturing the markets there. Although I do not retract what I said previously about the poor quality of some smoking pipes offered for sale, I am now aware that better pipes than those to’ which I referred are being made in Australia.
– I draw attention to the inadequacy of the pension received by the majority of war widows. A better word would be “ allotment “, for it is the continuation of the soldier’s allotment to his wife and dependants. Consider the case of a serving soldier with a wife and two children. The amount coming into the home then was £5 2s. a week, made up of an allotment of 3s. 6d. a day from the soldier’s pay, a dependant’s allotment of 4s. 6d. a day for his wife, 3s. a day for the first child, plus 7s. 6d. a week child endowment and 2s. 6d. a day for the other child. When the wife became a widow the amount paid was £4 7s. 6d. a week, made up of her pension of £2 10s. a week, her 17s. 6d. a week for the first child, plus 7s. 6d. child endowment and 12s. 6d. for the other child. On the 1st July next an additional 5s. a week will be received -thesame as for civil widows and oldage and invalid pensioners - thus bringing the total weekly payment to £4 12s. 6d. as against £5 2s. 5d. when the husband was on active service. It may be argued that with £4 12s. 6d. a week a widow with two children can manage just as well as she did on £5 2s. before her husband was. killed. But what a comparison to make when a woman has lost her helpmate a breadwinner - a man who gave hie life for the protection and future welfare of his country. Of course she struggled along cheerfully while her husband was away. She looked forward, to easier times when the war was over and the head of the family was earning much more than her war-time allotments. But what is her position? To supplement her pension and child allotments she can take up some kind of work. At present she receives 16s. less than a basic wage family. The lack of a father is <a terrible hardship. There is no one to advise and control the young children. In addition, she has to do or leave undone many necessary things about the house that her husband would have done. It is wrong that a widow with children should have to go out working at all. The correct upbringing of the children is most important. Denied a father’s guiding hand they tend to drift into -undesirable -ways of life. In granting a war widow’s pension there is no means test. It is just a flat rate of £2 10s. a week, while the war widow’s pension was £2 2s. a week. ‘An increase of 8s. was granted in 1943. In this period of 23 years the basic wage increased by £2 5s. a week while the war widow’s pension increased by 8s. a week.
I hold no brief for the young widow without children. She can supplement her pension considerably in many walks of life. She . probably lives with her parents and she Can marry again. Her pension of course would then cease. Nor do I hold any brief f ot the widow who is in comfortable circumstances. It is the 60 or 65 per cent, of other war widows with whom I am concerned. How can they be assisted? Would it he better to increase the allowance for the children or increase the widow’s pension? The consensus of opinion of people with whom I have dis- - cussed this question is that the pension should be increased, either by an amendment of the Australian Soldiers’ Repatriation Act or an administrative instruction. An increase of up to £1 a week over and above the basic war widow’s rate should be granted to those widows in the greatest need. They should be treated as special cases’ and dealt with sympathetically on their merits. I suggest to the’ Minister for Repatriation (Mr. Barnard) that the advice of- the Legacy Club in each State might be sought. Legacy clubs are doing a magnificent work in connexion with the children of deceased soldiers. They have a confidential register showing each widow’s economic position and the success or otherwise of heT control over the children. The problem cases are those where the mother has not sufficient time and energy after a day’s work to devote to their well-being.
I ask that this matter be brought to the notice of the Minister for Repatriation, so that something may be done regarding it before the end of the present financial year.
– I regret thai I was not in fie chamber when Senator Brand began speaking, but I shall take the opportunity tomorrow to peruse his comments, and to bring them to the notice of the Minister for .Repatriation (Mr. Barnard), who himself has had certain family disabilities as the result of the war, and who I am sure, has a most sympathetic outlook on this matter. If the honorable senator’s statement that there was no increase of the war widows’ pension of £2 2s. from 1920 until 1943 be true, he and his associates on the other side of the chamber must accept a very high degree of responsibility for that, because they were in occupation of the treasury benches for many years during that period. Their own Ministers for Repatriation could have faced the position, and if they believed something were wrong, they could have taken the necessary action. I personally am not familiar with the period during which the honorable senator claims there was no rise. In the very near future, the Minister for Repatriation will introduce into the Parliament a measure to provide for increased repatriation pensions. War widows will be included in that class. In the meantime, the honorable senator’s representations -will be conveyed to the Minister, and the honorable senator himself will have an opportunity to deal with the matter in this chamber before the present sitting concludes.
Question resolved in the affirmative.
The following papers were pre sented : -
Arbitration (Public Service) Act - Determinations by the Arbitrator, &c. - 1947-
No. 30 - Amalgamated Engineering Union; and others.
Nos. 37 and 38 - Amalgamated Postal
Workers’ Union of Australia.
No. 39 - Commonwealth Postmasters’ Association.
Nos. 40-43 - Amalgamated Postal Workers’ Union of Australia.
No. 44 - Federated Ironworkers Association of Australia and Commonwealth Storemen and Packers’ Union.
Commonwealth Public Service Act - Appointments - Department of Labour and National Service - C. R. Airey, S. H. Solomon.
Defence Act - Regulations - Statutory Rules 1947, No. 59.
Defence (Transitional Provisions) Act - Regulations - Statutory Rules 1947, No. 55.
National Security Act - National Security (War Damage to Property) Regulations - War Damage Commission - Report for 1946.
Seat of Government Acceptance Act and Seat of Government (Administration) Act - Regulations - 1947 - No. 2 (Juries Ordinance).
Senate adjourned at 10.50 p.m.
Cite as: Australia, Senate, Debates, 28 May 1947, viewed 22 October 2017, <http://historichansard.net/senate/1947/19470528_senate_18_192/>.