Senate
28 May 1952

20th Parliament · 1st Session

  1. Senate
  2. 20th Parliament
  3. 1952

The President (Senator the Hon. Edward Mattner) took the chair at 3 p.m., and read prayers.

page 885

DAIRY RESEARCH LABORATORY, HIGHETT

Report of Public Works Committee.

Senator O’BYRNE:
TASMANIA

– I present the report of the Public Works Committee on the following subject : -

Proposed erection of a -dairy research laboratory at Highett, Victoria.

Ordered to be printed.

page 885

QUESTION

WESTERN GERMANY

Senator VINCENT:
WESTERN AUSTRALIA

– During the current sessional period of the Parliament, is it the intention of the Minister representing the Minister for External. Affairs to make a statement to the Senate in regard to the attitude of the Government towards the situation in Europe, with particular reference to the peace treaties that were recently signed with Western Germany?

Senator SPICER:
Attorney-General · VICTORIA · LP

– The honorable senator was good enough to indicate to the Minister for External Affairs that he would direct this question to me to-day, and the Minister has provided me with the following answer : -

Honorable members will be aware from the press during the last few days’ of the concluding stages in the signature of an important set of agreements defining Western Germany’s relationship with the West. The agreements in question are -

First, theso-called “ contractual agreements “, which weresigned yesterday in Bonn between Western Germany and the Western occupying powers (the United Kingdom, United States of America, and France) and which restore to the West German Federal Republic almost complete independence;

And secondly, the treaty between France, Italy, Belgium, the Netherlands, Luxembourg and Western Germany, establishing a European defence community, or European army as it is commonly called. The latter treaty, which is to be signed in Paris to-day, makes it possible for the Federal Republic to share in the defence of Western Europe without, however, allowing the revival of a German national army.

The Western Allies have found it necessary to go ahead with those agreements because of the Communist military threat to Western Europe and the persistent Soviet refusal in the last few years to permit the unification of Germany (now divided under the occupation of the Soviet Union and the Western Powers) on a basis of genuine independence.

Because of the Soviet attitude it has been impossible, so far, to conclude a peace treaty with a united Germany. The present agreements do not constitute a peace treaty, but, until such time as the Soviet Union changes its present policy, the agreements will give Western Germany most of the advantages of a peace treaty.

Australia is not a party to these agreements, but we have naturally been kept informed of the progress of discussions. Honorable members will recall that, together with most other western members of the war-time alliance, Australia terminated the legal state of war with Germany on the 9th July, 1951. That act, the main purpose of which was to restore normal relations with the Federal Republic, does not of course obviate the need for an eventual peace treaty. I understand that a general statement covering all aspects of external affairs, including Western Germany, will be made by the Minister for External Affairs early next week.

page 886

CIVIL AVIATION

Senator ARMSTRONG:
NEW SOUTH WALES

– In view of the fact that the Australian Government has now directed that a very substantial portion of Commonwealth business hitherto handled by Trans-Australia Airlines shall be transferred to Australian National Airways Proprietary Limited, will the Government direct that Australian National Airways Proprietary Limited shall become a “ common carrier “, and so give to the public the same rights, privileges, protection and services as are extended by Trans-Australia Airlines which is a “ common carrier “.

Senator McLEAY:
Minister for Shipping and Transport · SOUTH AUSTRALIA · LP

– I understand that Australian National Airways Proprietary Limited is already giving such services. However, I shall refer the honorable member’s question to the Minister for Civil Aviation.

page 886

QUESTION

RAIL TRANSPORT

Senator PIESSE:
WESTERN AUSTRALIA

– As most honorable senators are aware, as from the 1st of June, the time taken for the rail journey from Adelaide to Perth will be reduced from three days to two days by the use of new diesel electric locomotives. At present, the service given by the dining car staff and the coach conductors on the Trans-AustralianRailway is excellent, but the coaches are dilapidated. I understand that new rolling-stock will arrive shortly from Europe. Can the Minister for Shipping and Transport say when the new coaches will be ready for use?

Senator McLEAY:
LP

– I understand from reports that I have received from the Commonwealth Commissioner forRailways, that two new trains each of nine coaches are expected to arrive in Australia in July. The trial run from Port Pirie to Kalgoorlie will be made about the end of August. . If the sittings of the Senate permit, I shall be -pleased to extend an invitation to Senator Piesse and his fellow Western Australians to travel in one of the new trains.

Senator HANNAFORD:
SOUTH AUSTRALIA

– Last year, the Commonwealth entered into an arrangement with the Government of South Australia for the appointment of a royal commission to inquire into the practicability of constructing a new railway line between Stirling and Brachina on the north-south line. Can the Minister for Shipping and Transport say when the findings of the royal commission will be presented to the Parliament?

Senator McLEAY:

– The latest information at my disposal is that the inquiry will be completed in a week or so, and I assume that the report will be received about a month later. The holding of the inquiry is not preventing the Commonwealth from proceeding with the task of widening the gauge from 3 ft. 6 in. to 4 ft. 8-£ in., because work has been commenced at the far end of the section.

page 887

QUESTION

GOVERNMENT LOAN’S AND FINANCE

Senator BYRNE:
QUEENSLAND · ALP; QLP from 1957; DLP from 1968

– Is the Minister representing the Treasurer aware that, in Ipswich, one of Queensland’s main cities and an important coal-mining industry and railway maintenance and construction centre, the City Council is concerned that works of major and national importance such as the eastern suburbs sewerage scheme, the augmentation of the city water supply, and the BundamaGoodna water supply scheme, may be jeopardized through inability to secure adequate debenture loans early in the new financial year? Is the Minister further aware that the council was unable to secure any debenture loans between August, 195.1, and January, 1952, and that if this state of affairs continues in the next financial year, it will be difficult to carry on the works that I have referred to? In view df the serious position that faces the Ipswich City Council and other local authorities throughout Australia clue to the curtailment of loan moneys, vill the Minister ask the Treasurer to recommend to the Government that the Loan Council be convened in an endeavour to arrive at a formula that will allow necessary and reasonable development of the resources of the Commonwealth to proceed without undue interruption?

Senator SPICER:
LP

– I am not aware of any of the facts to which the honorable senator has referred. If he places his question on the notice-paper I shall obtain an answer for him from the Treasurer. I understand that a meeting of the Loan Council is likely to be held in June or early in July.

Senator COURTICE:
QUEENSLAND

– Has the attention of the Minister representing the Treasurer been directed to the published statement of a clergyman in Brisbane that his church organization had invested in government loans and that, because of unexpected expenditure in connexion with the work of the church, they were compelled to realize on a portion of their loan investment and had suffered a loss of £5,000 due to the action of the Government in altering the interest rate? Will the Minister consider the buying back of such bonds at par in order to encourage the small investor to invest in future Government loans?

Senator SPICER:

– The honorable senator has advanced a proposition to which it would -be very difficult to give effect. The price of Commonwealth bonds on the market is, of course, affected by the prevailing interest rate. It is true that during the last few years there have been some fluctuations upwards of interest rates. Fluctuations in the fixed interest rate for Commonwealth bonds have been agreed upon by the Loan Council, in which, as honorable senators know, the Premiers and Treasurers of the States are represented. In fact, they have a larger combined vote than tha Commonwealth. It is very difficult for me to sen how Commonwealth bonds could be in any different position from company debentures in this connexion. If the interest rate declines, the capital value of Commonwealth bonds tends to rise. I do not think that it has ever been suggested that in those circumstances a refund should be made to the Government. On the other hand, if the interest rate tends to rise, the capital value of Commonwealth bonds tends to fall, but the bondholders always have the assurance that they hold securities that are guaranteed by the Government,- and that they will be paid the full face value of their bonds at the date of maturity. If the honorable senator is not satisfied with what I have said, and cares to place his question on the notice-paper, I shall bring it to the attention of the Treasurer.

page 888

QUESTION

AGRICULTURAL MACHINERY

Senator CHAMBERLAIN:
TASMANIA

– I desire to ask the Minister representing the Minister for Commerce and Agriculture a question relating to the inability of farmers in my State to secure adequate supplies of American machinery with which to increase the productivity of their farms. Difficulty has also been experienced in obtaining duplicate parts for machinery which was purchased under the lend-lease arrangements. The position is very unfortunate. Farmers in other parts of the Commonwealth have assured me that this state of affairs applies throughout Australia. In the event of Australia securing a dollar loan will the Minister emphasize the need for a considerable portion of the loan to be used for the purchase of needed farm machinery and implements from America? “Will he also make provision for adequate stocks of duplicate parts to he purchased for the purpose of maintaining the efficiency of American machinery and implements which are nl ready in this country?

Senator O’SULLIVAN:
Minister for Trade and Customs · QUEENSLAND · LP

– A considerable part of the 100,000,000 dollars which was borrowed by Australia was expended on equipment for farms, and earth-moving and road-making equipment of a typo not manufactured in Australia. However, Australian manufacturers are now supplying a very substantial proportion of farming requirements. If the honorable senator will give me details of the case that he has in mind I may be able to inform him of some source of local supply. In the event of a further loan being made available by America I am sure that it will be used in the best interests of the development of this country.

page 888

QUESTION

KURRI KURRI DRILL HALL

Senator ARNOLD:
NEW SOUTH WALES

– In view of the fact that David Jones Limited has been utilizing the drill hall at Kurri Kurri for some considerable time as a clothing factory and that about 70 women are employed there, will the Minister for Repatriation request the Minister for the Army to re-consider his decision to resume this drill hall? The Minister’s proposed action would result in these women losing their positions and there is no other avenue of employment open to them on the coal-fields.

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

– I shall bring to the notice of the Minister for the Army the situation that the honorable senator has mentioned and let him have a reply at an early date.

page 888

QUESTION

OIL AND PETROL

Senator SEWARD:
WESTERN AUSTRALIA

– Will the Minister representing the Prime Minister in- form the Senate whether Commonwealth Oil Refineries Limited has applied for permission to increase its capital in order to enable it to expand its works sufficiently to enable it to handle the greatly increased amount of petroleum products that will be available from the Anglo-Iranian Oil Refineries that are to be established at Kwinina, in Western Australia? If this is so, when was the application received? Has the Capital Issues Board granted such request? If it has not, what is the reason for the delay in dealing with the request? Has the Commonwealth Government agreed to provide a share of the increased capital of Commonwealth Oil Refineries Limited? Is the Government aware that any delay in granting the request of Commonwealth Oil Refineries Limited must slow down the Anglo-Iranian Oil Company’s preparations for the construction of its proposed refinery 1 In view of the national importance of the proposed refinery to Australia, will the Government take the steps necessary to have the application of Commonwealth Oil Refineries Limited granted, and all impediments to proceeding with the works of both organizations removed before thi present sitting of Parliament clones? If not, why not?

Senator O’SULLIVAN:
LP

– I assure the honorable senator that the Australian Government will render every assistance in the expeditious completion of the operation that has been contemplated in Western Australia by the Anglo-Iranian Oil Company Limited. In order that the detailed information asked for may be obtained, I ask the honorable senator to place his question on the notice-paper and I shall endeavour to obtain an. early rs-ply to it.

page 889

QUESTION

VEGOLYSEN

Senator COLE:
TASMANIA

– Will the Minister representing the Minister for Health have further investigations made with a view to having the drug Vegolysen placed on the list of life-saving drugs ? This drug is used for special cases of blood pressure, and the demand for it would not be great, but it would be of great help to superannuated persons who are in need of the drug if they were able to obtain it free of cost.

Senator COOPER:
CP

– I shall be pleased to bring the honorable member’s suggestion to the notice of the Minister for Health, and to obtain a reply from him.

page 889

WHEAT

Senator ANNABELLE RANKIN Can the Minister representing the Minister for Commerce and Agriculture make a simple statement on the wheat position in so far as it affects the cost of feed wheat purchased by poultry-farmers and other users of wheat for feed purposes?

Senator McLEAY:
LP

– I shall obtain a report from the Minister on the subject, and make it available to the honorable senator.

page 889

QUESTION

KOJE PRISON CAMP

Senator O’BYRNE:

– I ask the Minister for Trade and Customs whether the Government is satisfied with the conduct of affairs at Koje prison camp? It is customary for the guards outside a prison camp to be in full control of the prisoners inside. According to our own news services the situation which has developed in the Koje prison camp is such that the Geneva, convention relating to prisoners of war is being contravened. Will the Minister take immediate steps to have representatives of the International Red Cross visit the camp in order to make recommendations that may remedy the present shameful and humiliating position, which is not only a disgrace to civilization, but may also be taken as a precedent which could affect unfavorably the treatment of United Nations prisoners of war wherever they ure now, or wherever they may be held in the future?

Senator O’SULLIVAN:
LP

– This is not a subject which, in my opinion, should be discussed here at this stage. I assure the honorable senator - and I am sorry that the assurance should be deemed to be necessary - that Australia, in common with the other nations of the free world, will always observe the Geneva Convention, and the traditions of humanity and civilization, in our treatment of prisoners of war.

page 889

QUESTION

SPICES

Senator HENTY:
TASMANIA

– Is the Minister f or Trade and Customs aware that a shortage of spices in Australia is hampering the manufacture of meat products, both for local consumption and for export? Will he cause a census to be taken of the stocks of spices in Australia at the earliest opportunity, with a view to granting import licences to enable merchants to replenish their depleted stocks?

Senator O’SULLIVAN:
LP

– The shortages to which the honorable senator has referred have been brought to my notice. My department is making inquiries to see whether any action can be taken to alleviate the position.

page 889

QUESTION

SOCIAL SERVICES

Senator SANDFORD:
VICTORIA

– In view of the fact that costs and prices have risen steeply, will the Minister for Trade and Customs bring before the Cabinet the need to increase the amounts of unemployment and sickness benefits? Such payments have not been increased for many years.

Senator O’SULLIVAN:
LP

– I am not prepared to give a specific undertaking in regard to the matter raised by the honorable senator, but I assure him that the interests of the recipients of sickness and unemployment benefits are continually being carefully and sympathetically considered by the Government.

page 889

QUESTION

ARMED FORCES

Senator COLE:

– Will the Minister representing the Minister for the Army inform me of the rates of deferred pay that are payable to Australian soldiers serving in Korea and at the long-range weapons establishment in South Australia, respectively ?

Senator COOPER:
CP

– I shall be very pleased to obtain the desired information for the honorable senator.

Senator CRITCHLEY:
SOUTH AUSTRALIA

asked the Minister representing the Minister for the Army, upon notice -

  1. Is it a fact that members of the Permanent Army Forces ure now called upon to pay their own fares when travelling from camps to their homes whilst on annual leave or recreation period?

    1. Is it a fact that thu time spent in travelling to their homes on Such leave is included in their leave or recreation period?
    2. If so, will the Minister reconsider the position in order that more liberal conditions will operate for the Permanent Army personnel ?
Senator COOPER:

– The Minister for the Army has furnished the following answers : -

  1. No. A member of the Australian Military Forces proceeding on recreation leave may be grunted free travel once each year by the approved means and route of travel to’ his homo town. In special circumstances, such as a member being recalled from leave to meet service exigencies, free travel for recreation leave may be granted on one additional occasion during the leave year.
  2. No. When free leave travel is granted for recreation leave the travelling time for thu forward and return journeys is added to the leave granted, except in cases where the travelling time for the single journey by the approved method of travel is less than twelve hours.
  3. See answers to 1 and 2.

page 890

QUESTION

SNOWY MOUNTAINS SCHEME

Senator O’BYRNE:

– I address a question to the Minister for Trade and Customs in the absence of the Minister for National Development. In view of the importance of the development of the Snowy Mountains hydro-electric scheme as a means of giving impetus to the expansion of our primary and secondary industries, will the Minister suggest to the Cabinet the establishment of a sinking fund for the purpose of financing the Snowy Mountains Authority to embark upon a five-year plan to bring to early fruition as much of the scheme as is possible ? Will the Minister call for a report from the commissioners on the amount of finance necessary to ensure continuity in the progress of this tremendously important project?

Senator O’SULLIVAN:
LP

– The Snowy Mountains project is one of which Australia may well be proud. I am not in a position to give an assurance along the lines requested by the honorable senator,, but I shall discuss his suggestion with the Minister for National Development.

page 890

QUESTION

CANBERRA

Senator McCALLUM:
NEW SOUTH WALES

asked the Minister representing the Minister for theInterior, upon notice -

What steps are being taken by the Government to attract people engaged in privateindustry, or who wish to engage in private industry, to the Australian Capital Territory?

Senator McLEAY:
LP

– The Minister for the Interior has furnished the following reply : -

It is not clear from the question what thehonorable senator has in mind when he refers to attracting people in private industry. Peoplein private industry can generally be relied on to investigate and assess the prospects of establishing themselves where their enterpriseis likely to be successful. If by “ attract “ the honorable senator means the granting of special concessions or subsidies, other than making land available on liberal terms, the answer to> the question is, “ None “. The fact that people in private industry obtain land in the Australian Capital Territory on 99 year leasehold at a moderate rental, thus requiring no capital investment in land, could he regarded as a step to attract industry. It is relevant to the question to point out that 33 sites were recently leased in Braddon, Canberra, to persons wishing to engage in private industry; these blocks were leased for minor industrial purposes only and several of the lessees have already erected new buildings. The major industrial development in the Australian Capital Territory will be on an area set apart for the purpose iti the Division of Fyshwick, on the eastern side of Canberra. A subdivisional scheme for part of this area has already been approved and leases of sites will be offered to persons wishing to engage in private industry when new roads are constructed and necessary essential engineering services can be provided.

page 890

QUESTION

URANIUM

Senator CRITCHLEY:

asked the Minister representing the Minister for Supply, upon notice -

  1. Will the Minister inform the Senate what arrangements have been made with the United Kingdom and the United States of America for the development of uranium deposits in Australia?
  2. To what extent are future Australian requirements assured as the result of such arrangements ?
Senator COOPER:
CP

– The Minister for Supply has furnished the following answer : -

The uranium deposits in Australia are to be developed by Australia, but in the negotiations which recently took place with representatives of the Atomic Energy Commission of the United States of America for the purchase of uranium ore, promises were made on behalf of the United States authorities to assist technically and financially, if desired, in the development of the deposits. Representatives of the Atomic Energy Commission of the United States were acting also on behalf of the United Kingdom in this particular instance.

In the negotiations which have token place, the greatest care has been exercised by we Australian Government to protect the future requirements of this country, having regard to the possible use of this material in one of its forms as a means of producing electric power for industry.

page 891

FOOD PRODUCTION

Formal Motion fob Adjournment.

The PRESIDENT (Senator the Hon Edward Mattner:
SOUTH AUSTRALIA

– 1 have received from Senator Aylett an intimation that he desires to move the adjournment of the Senate for the purpose of discussing a definite matter of urgent public importance, namely -

The failure of the Government to expand the nation’s food production to meet the needs of Australia’s rapidly increasing population and to provide a sufficient surplus for export to safeguard our overseas balance of payments position.

Senator AYLETT:
Tasmania

– I move -

That the Senate, at its rising, adjourn to to-morrow, at 11.30 a.m.

The PRESIDENT:

– Is the motion supported?

Four honorable senators having risen in support of the motion,

Senator AYLETT:

– I was prompted to move the motion now before the Senate because of the fact that our food production is not increasing in proportion to the rate of increase of our population. In addition, our overseas credits have been sadly depleted because of lack of exports, of which 85 per cent, must come from the land. I wish to divide my remarks into three sections in order that honorable senators opposite may follow them more easily.

The first section deals with our declining food production compared with our increasing population. The second is concerned with the steps necessary to stop the drift from the land which is now taking place, and the measures that are necessary to bring about an immediate increase of production on farms that are already in production. The third section is concerned with a long-range plan to increase production year by year.

I propose to refer to some of the past history of primary production in order to show the real causes of its decline. It will be necessary to look back to the 1930’s, when the farmers were in such a sorry state that they were not much better off than persons who were lining up for the dole. That situation was brought about because men on the land enjoyed no security. They were paid low prices for their products. There was a lack of markets and also a lack of credit. Bank foreclosures had sent many of them bankrupt and many others on to the dole’. Their security had completely gone, and they had no incentive to produce more than they needed for their own consumption. That was almost the picture which confronted a Labour government when it came to office in 1941. That Government set about to give the farmers incentives to produce. It did so because primary production was in such a serious state that our war effort would have been seriously affected had something not been done.

Senator Cormack:

– Is that why that Government conscripted rural workers.

Senator AYLETT:

– The action that was taken by that Government could be studied with advantage by the present Government.

The rural production per capita increased, after Labour came to office, by 50 per cent. To-day, the production of primary produce is being achieved with 60,000 fewer workers than there were prior to the last war. In order to stabilize the position and to give the farmers incentives to produce, the Labour Government guaranteed prices for many products.

Sentor GEORGE RANKIN:
VICTORIA · CP

– It restricted wheat-growing and was obliged to buy wheat from America.

Senator AYLETT:

– It gave farmers subsidies in order to soften the effect of rising prices on the consumers. At the same time it pegged wages so that costs would be kept down. It made contracts with the farmers so that there would be a balanced production in this country, and not an over-supply of some products and a scarcity of others. It concentrated the available labour force on the most essential production. It provided transport facilities, despite the difficulties due to war conditions. Never at any time were commodities help up as they have been during the regime of this Government. Even during the war, the Labour Government was able to find ships for the transport of primary products. It ensured that the farmers had adequate supplies of. bags, which have been very scarce ever since the present Government was elected. It gave farmers their share of the labour that was available. There is no doubt that the farmers responded to the treatment accorded them by that Government.

Let us now come to the post-war era. There were still incentives for farmers to produce between the time that the war ended and the election to office of the present Government. The Australian Labour party did nothing to kill the incentives that had already been given. During the war, when the farmers were producing unprecedented quantities of primary products, with a restricted labour force, taxation was at its highest level. Had it remained at that high level after the war a decline of production would have been noticeable in Australia much earlier. The Labour Government continued to reduce taxes each year as the financial position of the country made such reductions possible. By giving to farmers an incentive to produce more, the Labour Government was able to build up huge overseas credits, undreamt of even by honorable senators opposite. Those credits were expanded because 85 per cent, of our exports consist of primary products, and the price of foodstuffs on the world markets was high. Reductions of taxes and the continuation of food subsidies kept the farmers on the land and in full production.

What are the causes of the continuing failure of our primary industries to keep pace with our increasing population? First, there is the failure of the Govern ment to maintain incentives to higher production. In spite of election promises, taxes have been increased instead of reduced. The farming section of the community alone has had to pay an additional £47,000,000 per annum in taxes. Not satisfied with increasing taxes, the Government has meddled with the five years averaging system, and primary producers are incensed at that unwarranted interference. The Government has meddled also with the depreciation allowance for plant and machinery. In brief, the Australian farmers to-day, like members of this Government, do not know from day to day where they are going or what will happen to them. The farmer has no guarantee of security. He does not know where the Government will hit him to-morrow. The Government has failed to obtain adequate supplies of juts for the manufacture of bags for primary products. It has failed also to ensure an adequate supply of wire netting which is most essential to any farming community. I am sure that not one representative of the primary producers on the Government benches will deny that, by fencing large holdings into smaller paddocks, production can be increased. Any one who does not know that does not even: know the theory of farming, far less the practice. The Government has failed also to provide adequate shipping space to transport primary products, not only overseas, but also to local markets. Repeated representations have been made from both sides of the chamber on this subject. The Labour Government was able to provide cargo space for this purpose even in time of war. To-day, while this Government purports to be searching the world for ships to carry Australian primary products, it is considering the sale of its own vessels, if indeed, they have not already been sold. The disposal of Commonwealth-owned steamers to private enterprise would mean a further curtailment of the cargo space available to transport our primary products.

Anothercauseofdecliningproduc- tionistheGovernment’screditrestric- tionpolicy.Honorablemembersop- positeneednottrytoarguethat theGovernmentdoesnotcontrolthe financialpolicyofthisnation.Many runners who could increase production if the necessary finance were available, are being refused accommodation by the banks, including the Commonwealth Bank, regardless of the security that they have to offer. I do, not suggest that loans should be issued without security; most farmers have ample security. The curtailment of allocations of loan funds to the States by the Australian Government is accentuating the difficulties of farmers, because the States are unable to build and maintain roads in out-back areas, and extend hydro-electric power and water supplies to farming communities. The development of rural areas was a feature of the election promises of the anti-Labour parties, but there is not sufficient money available even for vital irrigation schemes which could contribute much towards an immediate increase of primary production. The Government has obviously failed to live up to its election undertaking to make available to rural dwellers many of the amenities that are now en-joyed by city people. The farming community was promised that funds would be made available to house rural workers. That promise has been broken by the curtailment of loan allocations to the States. The result is that many farmers cannot get labour because they cannot provide accommodation for their workers. I believe that home building for farm workers should be undertaken immediately.

I have mentioned just a few of the Government’s broken promises. The incentive of farmers to produce has been stifled in other ways. No one will deny that the contract system for the sale of our primary products overseas was a success, or that the guaranteed price system was a success. I have not the slightest doubt that production on lands already in use could be expanded considerably provided the right incentives were given. First, taxes must be reduced. Secondly, the five years averaging system must be restored, and the Government must stop its meddling with depreciation allowances. Farmers must be able to know exactly where they stand on taxation matters. The Government must alter ito financial policy to enable farmers to obtain the necessary credits to improve their properties and increase production.

Ships must be provided for the transport of produce. It is no good having an over-supply of commodities in one part of the country while people elsewhere starve. In Tasmania I recently paid for swede turnips at the rate of £100 a ton retail. That price is charged because there is no control of profit margins. I dare say that the retailer who sold me the turnips paid about £20 a ton for them. The farmer is not able to get the benefit of the price that is paid by the consumer. The Government could, if it wished, devise a plan to enable him to get that benefit. The Government members opposed the proposals that were put forward at the recent referendum on prices, but the majority of farmers want guaranteed prices. They do not object to contract systems. I have before me a farmers’ paper which states that the implementation of a scheme for the payment of a guaranteed price for potatoes was urged at a fanners’ conference.

Senator SPICER:
LP

– Is there not a State government in Tasmania?

Senator AYLETT:

– This is a national question which calls for national action by the Australian Government. When Labour had the reins of government it implemented a contract system in cooperation with the States. The reestablishment of such a system would bring about a balanced, supply of produce and give the farmer the incentive to increase production which he has lost. The Government should also ensure that an adequate supply of superphosphate, manures, wire and wire netting are available to farmers at a reasonable price. The States should be provided with sufficient loan money to carry on a scheme to increase production.

Senator SPICER:
VICTORIA · LP

– Where can the Government get the money ?

Senator AYLETT:

– If the Government had not lost the confidence of the people the Attorney-General (Senator Spicer) would not have to ask such a stupid question. Nobody knows better than the Attorney-General that there is more money in Australia than there has ever been. The Government was able to provide money for a war which, unfortunately, resulted in the destruction of humanity. Where is the intelligence of a government that cannot find money for the uplift of humanity by increasing production? Many thousands of people in various countries are starving and if production is not increased in this country we shall have to import agricultural foodstuffs by I960.

I have outlined the way in which the Government can proceed to increase production immediately. I now want to put forward an outline of a long-range plan which must be brought into operation in order to save Australia from bankruptcy. We must have exports to balance imports, and the Government must devise a plan to increase production, year by year, in order to cope with our increased population, which will be over 12,000,000 people by 1960. Imagine where we shall be, with production at its present level, if we do not take immediate action to meet the future! The Government has set a target for production, but it has not announced any means by which that target can be reached. The Government is talking instead of acting. Millions of acres of fertile land are not producing anything in Australia. Those areas can be brought into production. The Government is creating a pool of unemployed. Before I left home I contacted the National Service Office and tried to get jobs for a few men. I was told that it was hopeless to try to get work for them. Millions of acres can be brought into production if the Government will face the issue. The Attorney-General has asked where the Government is to obtain money. If the confidence of the people in the Government is restored, they will provide the money. The Government should peg the interest rate instead of allowing it to fluctuate with every loan. If that course of action fails, then the Government should obtain the money from the Commonwealth Bank in the same way as we obtained £350,000,000 from that bank for war purposes. It is time that the Government realized that it has lost the confidence of the electors. If it cannot obtain the money that is required for the development of the country it should allow a government which will have the confidence of the electors to take office.

The expansion of soldier land settlement in co-operation with the States would enable unproductive land to be brought into production. But instead of assisting the States to implement closer settlement schemes for exservicemen the Government has retarded the rate of land settlement by reducing loan funds. Because of the Government’s action the money available to the States for land settlement schemes has been reduced by about one-third. This amount should be greatly increased. When all the soldiers who desire to take up farming have been settled on the land the Government will find that plenty of farmers’ sons will be ready to work their own properties. When all the farmers’ sons have been provided with holdings the Government could proceed to give land to military trainees. The Government will find that there is no dearth of men who are waiting to go onto the land. If the Government would carry out the promises that it made prior to the last general election in relation to soldier settlement and extend that scheme further it would find that production would be increased to a greater extent than it had imagined to be possible. The Victorian Government had to reduce its intended expenditure on land settlement by from £3,000,000 to £4,000,000. The time has arrived when the Government should call a conference of State Ministers of Agriculture and expert agricultural officers with a view to evolving a long-range plan for the development of land that is at present lying idle. I have some knowledge of the efficiency of State Departments of Agriculture, and of the zeal of their officers. I am sure that the Government would be amazed at the speed with which the State authorities would be able to place before it a positive plan to bring into production much fertile land that is now unused because money is not available for necessary developmental works. This Government has taken from the States the right to raise money for developmental purposes. The responsibility rests squarely upon the Commonwealth to take measures to increase primary production, just as did the Labour Government during the war. It is only since the present Government has been in office that the alarming decrease of production has taken place. At the present time, only 17 per cent, of the total labour force in Australia is engaged in primary production, whereas in the United .States of America, a much more highly industrialized and mechanized country than ours, no less than 23 per cent, of the labour force is so engaged. At the last meeting of the Australian Agricultural Council resolutions were carried asking for the implementation of the very policy which the Labour Government had put into operation during the war.

Senator McLeay:

– Well, what happened to it ?

Senator AYLETT:

– It has been rendered ineffective because the Government has taken away the incentive to produce. The Australian Agricultural Council has suggested that the Commonwealth should do certain things which, under the Constitution, it lacks the power to do, but I am sure that if the Government were to hold a referendum on the issue the people would very willingly grant the power sought. The Minister for Commerce and Agriculture v (Mr. McEwen), who was chairman of the last meeting of the Australian Agricultural Council, published a statement in which he set out the targets for increased production. Whether he had a definite plan for achieving his objective I do not know. If he had such a plan, it is evident that Cabinet has let him down, and he is now standing alone with no one to back him up.

Senator McLEAY:
Minister for Shipping and Transport · South Australia · LP

– We have just listened to an amazing speech on a very important subject, and I am tempted to repeat the comment of a well-known honorable senator from South Australia who once said that he was pleased to acknowledge that Senator Aylett was the most improved politician in the Parliament, but he was still the worst. The honorable senator’s speech consisted of vague generalities, although a subject of such importance deserved careful attention. I had hoped that members of the Opposition and, indeed, members of all parties would offer constructive suggestions.

Senator Aylett said that when the Labour Government came into office in 1941 farmers were on the dole. I remind him that the war began in 1939, and that between then and 1941 the Menzies Government had entered into contracts with the United Kingdom for the sale of primary produce at improved prices. It is not true that in 1941 farmers were on the dole. The honorable senator then went on to tell us what the Labour Government had done during the eight years that it had been in office. I do not think that I need waste time by replying in detail to the honorable senator. The best answer I can make, is to ask what the people did to the Labour Government at the general election of December, 1949, after that Government had been in office for eight years.

I agree that the State departments of agriculture, and the State governments, which are charged with the responsibility of increasing primary production, have done exceptionally good work. While the Minister for Commerce and Agriculture (Mr. McEwen) was in London recently I was associated with the Department of Commerce and Agriculture, and I was amazed to see the work that had been done and the amount of information that had been collected by the department working in conjunction with the State authorities. Now this genius from Tasmania suggests that the Government should call a conference of State Ministers of Agriculture. Such conferences have been held regularly during the last fifteen years. There is a standing committee of technical men drawn from the Departments of Agriculture of the seven governments, and it is doing exceptionally fine work. Notwithstanding all the criticism and misrepresentation, the fact remains that the farmers were never more prosperous than they are to-day. Despite changing economic conditions, prices for primary products are still high.

The Government has had to take certain steps . in regard to imports. The importation of luxuries has been restricted, but first priority has been given for the importation of all goods that are associated with rural industries. The Government is fully aware of the need to encourage primary production, and if any member of the Opposition can put forward a practical suggestion I shall be pleased to pass it on to the Minister for Commerce and Agriculture. The nation owes a debt of gratitude to the Minister for the work he has done during the two and a half years that he has been in office. I have observed him closely, and I know that he has devoted himself consistently, during all hours of the day and night, to the task before him.

It is not fair to suggest that the Government has allowed the position to drift. Of course, the substantial decline of wool prices that has taken place during the last twelve months has had a disastrous effect on our balance of payments in London. For that we cannot blame the Australian Labour party or the Liberal party or any other party. The export price for wheat is still good, and this Government, in conjunction with the State governments, has made every effort to increase the production of wheat. As an incentive to growers, the Government has agreed to pay a subsidy of 4s. a bushel on the 26,000,000 bushels of wheat produced for stock-feed. That was a very handsome subsidy to the wheat industry. The Commonwealth is eager to ensure that the men and women who are engaged in the dairying industry shall enjoy a standard of living that is at least comparable with the standard of people who are engaged in secondary industries. The Minister for Commerce and Agriculture and his officers have established an organization to ascertain costs in the industry. As a result, the price paid to producers of butter has risen considerably. At present the Commonwealth subsidizes the production of butter by £16,800,000 per annum. This is a greater degree of assistance by the Government than the butter industry has ever received previously. The people engaged in that industry now enjoy, as they are entitled to enjoy, a standard of living in keeping with the standard generally in Australia.

I shall now refer to the long-term meat agreement between Australia and Great Britain. Although we did not, perhaps, obtain for some of our products as high a price as we should have liked, the agreement contains a provision that prices shall be reviewed from time to time. I believe that the most important feature of the agreement is that the British Government is prepared to take most of our primary produce available for a period of fifteen years. I consider that the Minister for Commerce and Agriculture did an exceptionally good job in that respect. This agreement offers stability to the people who are prepared to invest in primary production in this country. I have recently studied the figures relating to the land settlement of exservicemen in Australia. The Commonwealth, in co-operation with the States, has helped ex-servicemen in many ways. The following table sets out details of Commonwealth expenditure on war service land settlement from the inception of the scheme in 1946 to the 31st March, 1952 :-

Details of farms provided by approvals to the 31st March, 1952, are as follows : -

Note. - Settlers are in occupation of many farms in excess of those shown as actually allotted under lease, but for various reasons are not yet classed as officially allotted.

I come now to re-establishment loans, in connexion with which 16,272 applications have been approved for loans totalling £11,678,117. The loans actually advanced number 14,961, for a total amount of £10,S02,968. In addition, 13,236 applications for re-establishment allowances have been approved, involving a total expenditure of £2,236,605, and approximately 6,000 ex-servicemen have received rural training at a cost to the Commonwealth of £1,424,176. I think it will be generally agreed that the results that will flow from the expenditures that I have enumerated will be of very great benefit to the community.

Honorable senators opposite have referred to the shortage of superphosphate. In view of the great difficulty that the ‘Government has experienced in obtaining sufficient sulphur, the Commonwealth has decided to make substantial contributions to various people who are interested in the establishment of plants for the treatment of pyrites. This should ultimately react to the benefit of agriculturalists. Looking down the list a little further I come to the matter of the 100,000,000 dollar loan that was obtained by the Prime Minister (Mr. Menzies). When I was in the United States of America in 1945-

Senator Ashley:

– It is a pity that the Americans did not keep the Minister there !

Senator McLEAY:

– Senator Ashley is usually complimentary. I can assure him that the Americans would not be pleased to keep him in their country. I was sorry to find that the American people generally had a very poor opinion of Australia. Some who were interested in the development of this country said, “ What sort of crazy government have you in Australia, that is encouraging the “ reds “, nationalizing the banks, and pursuing a policy of socialization? American investors are not anxious to take risks in your country while the present policy is pursued there “. On the other hand, I was pleased; to find that wherever I went in the United States of America and Canada people from all sections of the community that mattered had a very high appreciation of the calibre and ability of the present Prime Minister. I believe that this has done more to enhance Australia in the eyes of the Americans than has .anything else. In connexion with the 100,000,000 dollar loan, priority was given to the supply of tractors and other farming implements required by the primary producers of this country.

Senator Aylett has referred to tax concessions. I remind him that this Government has approved of a 20 per cent, special depreciation allowance for farmers for a period of five years from the 1st July, 1951. This will be of more value to the primary producers of this country than any other governmental assistance to them since federation. The Government is endeavouring to encourage farmers to provide homes for their employees and to acquire implements and plant necessary to increase production. I am sure that they will be quick to take advantage of the great measure of assistance that the Government is rendering to them in this connexion.

I come now to the valuable work that has been accomplished by the Australian Agricultural Council. At its recent meeting a practical plan that was submitted by the Minister for Commerce and Agriculture and his technical advisors to increase exports by £100,000,000 during the next five years was adopted unanimously by the State and Commonwealth Ministers. The Minister for Immigration (Mr. Holt) and the officers of his department have been at pains to obtain immigrants who have been specially trained in rural production.

Senator Aylett:

– While our own people are looking for jobs !

Senator McLEAY:

– I am not surprised at Senator Aylett making such a silly interjection. The most important task confronting us at present is to increase primary production. Although the Commonwealth is doing all possible to assist the farmers, ultimately the job rests with the fanners themselves. I firmly believe that they appreciate the importance of the matter, and the necessity for Australia to send the greatest possible quantity of foodstuffs to the United Kingdom and the starving countries of the world. There is no better section of the Australian community than the farmers, and I am sure that they will rise to the occasion. In tura, perhaps the most serious problem confronting the farmers and others engaged in rural production is to reduce costs. Unfortunately, the policy that has been pursued by some State Labour governments has done more than anything else to increase costs.

Senator Cameron:

– What about putting value back into the £1 ?

Senator McLEAY:

– I should like to put sense into the head of the honorable senator who has just interjected. The Government, by the imposition of credit and other financial restrictions, has made a very important contribution to the solution of the problem of inflation that has so sorely beset primary as well as secondary industries. Whilst I appreciate the importance of the subject raised by Senator Aylett, I trust that ‘honorable senators opposite will be prepared to give credit where credit is due, endeavour to be constructive in their contributions to this debate, and make a sincere endeavour to ascertain what this Parliament can do to aid the people to solve this very important problem.

Senator Sheehan:

– What does the Minister suggest should be done ?

Senator McLEAY:

– I suggest that we should continue the policy that we have followed during the last two and a half years. If we do so we shall do more to better conditions in this country than the Labour governments did during the eight years in which they held office when they tinkered with communism and at the same time assiduously engaged in the practices of socialism.

Senator CRITCHLEY:
South Australia

– I support the motion, and am glad to have an opportunity to follow my colleague from South Australia, the Minister for Shipping and Transport (Senator McLeay). I marvelled at the fluency which marked his replies in evading pertinent interjections. Food production in Australia is as urgent and important now as it was during the war when food was declared to be a war weapon and was accorded the same priority as was given to the guns, aeroplanes, and warships that protected Aus-, tralia. The Minister querulously asked what the people did to the Labour Government when, in 1949, it appealed to them for support after having enjoyed the advantages of office for eight years. A recital of the factors that led up to the defeat of the Chifley Government in 1949 would not, perhaps, be out of place “t this stage. It would remind honorable senators who support the Government, and my colleagues on this side of the chamber, of the blatant manner in which the then Leader of the Opposition, the present Prime Minister (Mr. Menzies) misled the people, by specious promises when he delivered his policy speech at Canterbury, in Victoria, on the 10th November, 1949. I hold in my hand a pamphlet which sets out the joint Opposition policy as enunciated by the right honorable gentleman on that occasion. It is a very interesting document because it sets out in clear and concise terms the promises made by the right honorable gentleman which the Government has made no attempt to honour. The right honorable gentleman knew full well when he made them that they could never be honoured. Speaking on behalf of the Liberal and Australian Country parties the right honorable gentleman said -

We shall stimulate development of all basic industries, primary and secondary.

We shall pay much-needed attention to more remote and undeveloped areas such as North Queensland, the Northern Territory, and north-west Australia.

We shall actively aid oil search.

We put forward a positive decentralized national programme for rural production, to be carried out co-operatively with the States and with local and regional authorities.

Over a period of five years we shall raise loans totalling £250.000,000, the interest and sinking fund on which will be provided out of the petrol tax. The amount to be raised and spent each year will be conditioned by the availability of men and materials. Its general administration will be under a National Works Council. The work will include feeder road3; soil conservation; the development of rural housing, embracing the construction of groups of workers’ homes in seasonal labour areas; flood prevention : the provision of water, light and power; vermin and noxious weeds destruction. We will aim to improve carrying capacity, reduce costs, and increase productivity generally.

We stand for the stabilization of rum! industries wherever practicable on the basis of guaranteed minimum prices. Schemes to this end will not he set up unless growers, by vote, approve.

I concede that the Government made an attempt to honour the promise mentioned in the latter part of the extract that I have just read. The right honorable gentleman continued -

In particular, we support a long-term stabilization of the dairying industry for ten years (by subsidy where the price is not raised) and believe that the wheat stabilization scheme should operate for a similar period.

Home-consumption prices should be periodically reviewed, and losses on concession sales recouped.

We will confer with the wool industry in relation- to a floor prices policy after the termination of the present Joint Organization.

I do not intend to comment on the wool industry other than to remind honorable senators of the remarks of Senator Maher, who represents the State of Queensland, when the measure to give effect to that proposal was before the Senate.

The Minister for Shipping and Transport invited us to state the reasons why the Labour Government was removed from office. The Labour Government was defeated because the people believed the foul abuse and propaganda in which the then Opposition parties had indulged. The Menzies Government was elected to office because of its promise,’ amongst other things, to reduce taxes. The increase of taxes from their former level is the principal cause of the producers of this country having lost heart. On Friday, the 9th December, 1949, newspapers that circulate throughout South Australia carried huge advertisements stating that, if the then Opposition parties were elected to office they would reduce taxation. Newspaper advertisements published by the Australian Labour party at that time contained no such promise. They merely stated that if Labour were returned to office it would steadily reduce taxation as circumstances permitted. Not immediately after the general election of 1949, but on the 12th June, 1951, at the opening of the Twentieth Parliament following the double dissolution, when the Government could no longer hide behind the sham that its efforts were being frustrated by a hostile Senate, His Excellency the Governor-General, in outlining the policy of the Menzies Government in this chamber, said -

As food production is also of vital and growing importance and urgency, special attention will be paid by my Government to water supply and irrigation matters. In all of these problems it will collaborate fully with the State governments. Clearly, the development programme must be constantly reviewed, and individual projects related to the military and economic needs of the time.

What attempt has the Government made to honour those promises. Is it any wonder that the late lamented Mr. Chifley said of this Governments -

I do not think that ever in the history of this country has there been a government that used so many words and was responsible for so few deeds. … I do not think that there has been any government more inept, that has so completely betrayed the people.

It is useless for the Government to endeavour to escape responsibility for having failed to honour the promises made by its leaders which were prominently displayed in advertisements authorized by the Liberal-Country League, and were published in newspapers that circulate in the State which I represent. The leaders of the Government were guilty of a gross betrayal of the Australian people because when they promised to reduce taxes they knew full well the economy of the country would not permit reductions of taxes to be made. Honorable senators opposite are not even now prepared to give the Labour party credit for having refused to make such a specious promise to the people. I throw back into the teeth of the Minister for Trade and Customs (Senator O’sullivan) his taunt when he was in Opposition that the Chifley Government was power drunk. I hope that the people will soon have an opportunity to pass judgment on the misdeeds of this Government which gained office as the result of the untrue and morally wrong political propaganda which its leaders disseminated among the electors. The Government looked on while the level of primary production, which is vital to our economy, fell so low that it constituted a threat even to the maintenance of supplies of our own food requirements. It has set up almost insuperable obstacles for both primary and secondary producers by imposing unduly high rates of income tax, by imposing record sales tax rates and by its savage administration of bank credit restrictions. The loans which this Government has launched have not been filled. I could relate many instances of wealthy people, people on the land, for whom this Government claims to have done so much, who have invested in government loans and have regretted doing so. Why the Government should expect the people to- kaye- confidence in it is beyond’ my comprehension..

No- one will disagree with the contention that food production is of major importance to this country. Some months- ago, when we were discussing in this chamber the sum of money which should be allocated for defence purposes, I stated that food production was as vital as defence. I urged the Government not to stint, in any way, the amount of money that would be available for assistance to primary producers. I said then, as I say now, that the taxation impositions of the Government, which has pleaded its sympathy for primary producers, were in fact crippling primary producers. I remind honorable senators that the supporters of the Government stated, during the 1949 general, election campaign, that if elected to office they would reduce taxation and remove the “ iniquitous “ taxation measures of the Chifley Government. Their record is all the more regrettable because those who sit behind the Government know as well as we d:o that it was utterly impossible to reduce taxation to such a degree, and that to promise to do so amounted to political dishonesty. It is disturbing that the Prime Minister and the Government should indulge’ in a cheap window-dressing display of their achievements, real or imaginary. The right honorable gentleman has added to the display a liberal mixture of truth and untruth. The statement which he made on the 30th April last can only add to the general sense of uncertainty and instability that this Government has created throughout the community. The Government itself is probably the most serious threat to our immediate future as a nation. It cannot be denied that almost every pre-election promise made by the Government parties has been broken, nor can it be denied that the very people whom they flatter themselves they represent are disgusted with them. If honorable senators opposite are disposed to challenge that statement, I invite them to go to the country on the issue of lack of public confidence in the Government.

I think that the Senate will agree with me that although planners may plan, for greater production a.nd talk themselves hoarse exhorting the people to greater efforts, men and women being what they are, only a negligible handful1 will work more than they need! to do unless- incentives are provided. It is foolish to- pretend, that current rates of taxation have noi, reduced the incentive to work in every walk of life. Men who could produce more, when called upon for an extra output simply shrug, their shoulders and ask why they should do so. The Minister for Trade and Customs often asked in the Senate, when he was in Opposition, “ Why work for Chifley? “’ I remind theMinister of that frequent statement of his and say, with the sincerity which he professes at all times, “ Why work for Menzies, Fadden and O’S’ulli’van? “

The reduction’ of food production is not peculiar to Australia. It is a phenomenon that has been observed in other countries. It is my opinion, however, that this Government has been instrumental in bringing it about in Australia. The people cannot be expected to work for nothing,. 1111 the talk in the world will not restore primary production. The Minister for Trade and’ Customs has asked for constructive criticism from the Opposition. I suggest that the Government should inform the people that it will undo what it has already done and return to its stated policy of 1949. I know that conditions, have altered, but I can never forgive this Government for going unblushingly to the electors and telling them that, if returned’ to office, its first tasks would be to reduce taxation and to give- primary producers a more reasonable opportunity to succeed than did the Australian Labour party.

I believe that this is an important motion and that it should be debated, but let us face the facts. No amount of cajoling by the members of the Government can cover up their past actions. If they think that it can, I invite them to let their masters, the people, decide the question.

Senator REID:
New south Wales

– I have listened with interest to the remarks of Senator Aylett, who moved this motion, and also to those of Senator Critchley.. Once again it is evident that honorable senators opposite are attempting- to seize every opportunity to cast, upon the Government responsibility that does not rest with it. The encouragement of agricultural production in Australia and the methods to be adopted are entirely the concern of the State governments. The Australian Government will co-operate, as far as the Constitution allows, with the State governments, and will assist them to encourage production, but the methods adopted are solely matters for the States, r do not wish to detract from the importance of this matter, because I believe that it is of great moment. I also believe that this Government has always been most appreciative of its importance.

The honorable senators opposite who have spoken to the motion have put forward many causes which, in their opinion, have been responsible for our declining food production. They appeared to lay main emphasis on the effect of taxation. Senator Critchley referred to the joint opposition policy-speech and stated that although the Prime Minister (Mr. Menzies) promised in that speech to reduce taxation, that promise has not been honoured. I remind the honorable senator that in the 1951 budget, provision was made for a re-allocation of the system of allowances and deductions and also for the abolition of the rebate system which, in effect, amounted to a reduction of taxes by many millions of pounds a year. If my memory serves mc rightly, the amount of the reduction was approximately £20,000,000 per annum. Therefore, in the first budget that was introduced by the present Government parties the policy of taxation reduction was given effect, lt was the intention of the Government to continue that policy. Unfortunately, however, as all honorable senators are aware, the war in Korea intervened and it became necessary for Australia to face up to its obligations as one of the United Nations and also to provide for its own defence. I ask the honorable senator where he suggests that reductions of taxation should be made. Are we to fall down on our defence obligations? Are we to reduce social services ? If so, where is the first reduction to he effected?

I speak as a primary producer when I say that I do not consider that the effect of taxation is the bugbear to primary production which some honorable senators appear to think, it is. They have claimed that the Government has been responsible for increased taxation which has affected primary production and that it has not honoured its promises to reduce taxation. In order to determine the truth or otherwise of that claim, let us examine the rates of income tax in New Zealand and Australia. I remind honorable senators that New Zealand also is a major primary producing country. In 1950-51, on an income of £500, a New Zealand taxpayer with two children was required to pay tax of £37 10s., whereas in Australia he would be obliged to pay £8 14.s.

Senator Cooke:

– The rates have increased since the Government first came to office.

Senator REID:

– I arn referring to the position as it is to-day. On an income of £1,000, the New Zealand taxpayer to whom I have referred would pay £163 2s. 6d., whereas in Australia he would pay £83 4s. On an income of £2,000, the New Zealand taxpayer would pay £529 15s. and the Australian taxpayer £375 17s. On an income of £5,000, the New Zealand taxpayer would pay tax of £2,331, whereas the Australian taxpayer would pay £1,940. I ask honorable senators opposite why New Zealand should increase its rates of tax over the years so that to-day they are higher than those which operate in Australia. It will he seen that a New Zealand taxpayer with an income of £5,000 is required to pay almost £400 a year more than a person with a similar income in Australia.

Taking the production index figure as 100, in 1949-50 New Zealand was producing at the rate of 123, whereas Australia was producing at the rate of only 117. Do honorable senators opposite contend that Australian primary producers are any less patriotic than the primary producers of New Zealand? I suggest that taxation is not the main contributing factor in the decline of primary production. M.any other factors are involved. In my opinion, the main factor is the inability of farmers to obtain the essential commodities that they need. Amongst such commodities is machinery. The wire netting to which Senator Aylett referred is also essential but is in short supply. If honorable senators opposite ask themselves why it is scarce, I suggest they must agree that the extreme elements in the unions are restricting its production. This Government, from its inception, has set out to increase the production of such commodities. As yet it has had little help from the Opposition.

Instead of being an exporting primary producing State, New South Wales has become an importing State. The reason for the change is that the Government of New .South Wales is bleeding the primary producers white. For instance, last year rail freight on the carriage of wheat was increased by 166 per cent. Wheat grown in the area in which I Jive used to be transported for 7d. a bushel, now the charge is 2s. 4d. a bushel. The freight charge on wool has been increased by 200 per cent., and on stock by 156 per cent., yet the farmer is being asked to produce more! Farmers in New South Wales claim that they are being asked to produce more to keep the transport system of that State going and the Labour Government in office.

Senator Ashley:

– How would the farmers get on without a transport system ?

Senator REID:

– They should not be fleeced to maintain the transport system, but that is what is happening in New South Wales to-day. Prior to the advent of the Labour Government in that State, a tractor used for ordinary farm work could be registered for £1 a year. Now the fee is £50 a year. Registration fees on trucks have increased by 300 per cent. Is it any wonder that primary producers in New South Wales are kicking? The remedy lies with the State government, but that administration is endeavouring to place the responsibility upon the Commonwealth, where it does not rightly belong. The Australian Government is prepared to do everything possible to increase production. It is alleged that the Commonwealth’s credit restriction policy has handicapped the farmer, but that is not so. The following provision is made for rural advances : -

  1. An advance of up to £15.000 may be granted for the acquisition of a rural property to bc worked as a full-time occupation by the purchaser.
  2. Where the purchaser already owns any land a new or increased limit of not more than £5,000 may (subject to certain conditions) be granted for the acquisition of additional property.
  3. Banks may grant accommodation for the reasonable stocking, working, improvement and maintenance needs of a rural property, especially where the purpose of the advance is directed towards increasing productivity.

How can it be claimed, therefore, that credit restrictions are hampering primary producers? This Government has also been accused of drawing labour away from primary industries. I maintain that the responsibility for the drift of population to the cities lies, not with the Menzies Government, but with the Labour Government. Labour’s policy was to concentrate population in the cities for political purposes. Now honorable senators opposite are squealing because of the possibility of famine in the cities as a result of declining primary production. The cities have been over-industrialized at the expense of rural communities, and until the balance is restored, production will continue to be inadequate.

Senator Aylett alleged that the Australian Government had destroyed incentives to primary producers to increase their output. Let us have a look at the dairying industry. Under the Chifley Government, the stabilized price for dairy produce was based on 1942 land values, interest at the rate of 3£ per cent., stock values at £12 a head, and £7 15s. for the owner-farmer for a 56-hour seven-day week. Under the Menzies Government, costs are based on land values at the 1950 levels, interest at the rate of 4£ per cent., stock at £19 a head, and a fair wage for the owner-farmer in return for his 56-hour week. The States resisted the move to give dairy-farmers a fair deal by increasing the price of butter by 6d. per lb.; yet honorable senators opposite complain in this chamber and elsewhere that this Government has crippled the primary producing community with taxes and failed to give incentives for increased production! I have already shown that, in New Zealand, where income tax rates are higher than they are in this country, incentive has not been destroyed. I say in conclusion that this Government has exercised its constitutional powers to the full in an effort to stimulate primary production. A lot of piffle has been talked about loan allocations. The responsibility in that matter rests with the Australian Loan Council and with the State governments themselves. Honorable senators opposite are blaming the Commonwealth in an attempt to hoodwink the primary producers of Australia into believing that it is a Commonwealth responsibility whereas in fact, it is a State responsibility. I repeat that, on a population basis, the worst record in the field of primary production is that of New South Wales where a Labour Government is in office.

Senator BENN:
Queensland

.- It appears to be necessary once again to state the subject-matter now being debated because the two honorable senators who have attempted to defend the Government have been right off the beam. Senator Aylett’s motion relates to the failure of the Government to expand the nation’s food production to meet the needs of Australia’s rapidly increasing population and to provide a sufficient surplus for export to safeguard our position overseas in relation to balance of payments.

The Minister for Shipping and Transport (Senator McLeay) devoted a part of his time to praising certain other Ministers, and the remainder to the prices that are being received for Australian primary products. Senator Reid in his futile attempt to defend the Government, attacked the Government of New South Wales, but surely the result of the Liverpool by-election last week completely exonerates that Administration from any charge of failure to do its best to improve food production. Last week, a statement was made in this chamber on the Government’s economic policy. That statement was read in a very mournful tone, and with very good reason, because 11Ot only did it sound the death knell of the present Government but it also constituted the burial service of that Administration. I propose now to direct the minds of honorable senators once again to the policy-speech of the then joint Opposition parties in 1949. It is most interesting to read what the present Prime Minister (Mr. Menzies) had to say about production and other economic problems at that time. The right honorable gentleman said -

Perhaps our greatest charge against the financial and economic policy of the present socialist Government is that while it has paid a good deal of attention to increasing the volume and circulation of money, it has largely neglected the problem of what and how much that money will buy.

Ever)’ housewife knows how grievous this problem is.

The statistician will conservatively allow that the fi of 1039 is now only worth’ 12s. 2d. in purchasing power. But on the true cost of household requirements it would be nearer the mark to say that it is worth only 10s. The greatest task, therefore, is to get value back into the £1. that is, to get ,prices down.

That is the only effective way of increasing real wages and salaries and, indeed, all monetary payments. High prices are not a cause; they are a result of an abundance of spending money and an insufficient supply of things to buy.

What was the primary production policy enunciated by the right honorable gentleman at that time? He said -

We stand for the stabilization of rural industries wherever practicable on the basis of guaranteed minimum prices. Schemes to this end will not be set up unless growers, by vote, approve. The guaranteed price covering not only the found cost but also a reasonable profit margin for efficient production will be ascertained by independent cost-finding tribunals on the model of the Tariff Board. Boards established to realize a product should contain a majority of producers.

Tn particular, we support a long-term stabilization of the dairying industry for ten years (by subsidy where the price is not raised) and believe that the Wheat Stabilization Scheme should operate for a similar period.

Home consumption prices should be periodically reviewed, and losses on concession sales recouped.

We will confer with the wool industry in relation to a floor prices policy after the termination of the present Joint Organization.

We will give encouragement to the permanent establishment of the tobacco and cotton industries.

Those were the Government’s intentions. I shall return now to the Prime Minister’s reference to the need to put value back into the £1. He said, referring to the Chifley Government - . . While it has paid a good deal of attention to increasing the volume and circulation of money, it has largely neglected the problem of what and how much that money will buy.

At the end of June, 1949, the Australian note issue stood at £212,000,000. A year later it had risen to £231,000,000, an increase of £19,000,000. By June, 1951, it had increased to £275,000,000, or by a further £44,000,000. By the 31st March last, the note issue had reached £300,000,000. Therefore, since this Government took office the note issue has increased by £SS,000,000. Easing costs have compelled the Government to increase the note issue to enable it to keep on pumping money into the arteries of commerce and industry. What about prices? Has the Government put value back into the £1? I shall tell the true story about that matter, and it may hurt some Government supporters. When Labour took office in 1941, the basic wage in Queensland - it was then and still is slightly lower than the average foathe six capital cities - was £4 9s. a week. When Labour was defeated in 1949, the basic wage was £6 9s. a week. In other words, the increase during Labour’s eight and a half years of rule was only £2 a week. To-day, after only two and a half years of rule by the Menzies Government, the basic wage is £10 7s. a week, or £3 18s. a week more than it was when Labour relinquished office. That is how the Government has put value back into the £1. That is how it has brought- prices down. Every wage earner in Australia knows that the greatest danger to his livelihood lies in the constant increasing of the basic wage to meet higher living costs. It is like a politician leaving Canberra in an aeroplane. He goes up in the air and there is nothing underneath to support him. The basic wage has been increased, it is increasing, and it will continue to increase while this Government is in office. It is carrying the workers on and on and there is no production to support it.

Mention has been made in this debate of overseas balances. In 1939 Australia had an overseas balance of £55,700,000, in 1943 of £86,000,000, in 1945 of £20S,000,000, in 1948 of £273,000,000, in 1949 of £451,000.000, in 1950 of £650,000.000, and in 1951 of £843,000,000, but at the present time Australia’s overseas balance amounts only to £308,000,000. What is the answer to the reduced balance? Is it not greater pro- duction of primary produce ? The balance of £843,000,000 in 1951 was the result, not of greater production, but of higherprices for primary products, mainly wool. That balance was not safeguarded by the Government which, if it had had any political sagacity, would have realized that the answer to a falling overseas balance i3 a higher production of exportable commodities. Higher production of primary products was required. According to the Commonwealth Statistician, the factory production of butter in Australia fell sharply during the six months ended last December, compared with the corresponding period of the previous year. For the six months ended 31st December, 1951, 74,532 tons were produced compared with 94,049 tons during the corresponding period of the previous year. During the six months ended December last the production of cheese amounted to 27,310 tons, although 30,243 tons were produced during the corresponding period of 1950. Australian whole milk production amounted to 594,200,000 gallons for the six months ended 31st December, 1951, compared with 691,300,000 gallons in the corresponding period of the previous year. In other words, there has been a serious decline in dairying production. The estimated quantity of wheat harvested during the 1951-52 season was 161,400,000 bushels. The sowing of 10,434,000 acres was the lowest for any peace-time year since 1925-26 and 19.6 per cent, less than the average sowing for the five years before the war. During the early part of this year meetings of wheat-growers were held in Western Australia for the purpose of deciding whether they would decrease the acreage that they would sow. The farmers deliberately set out to decrease the production of wheat in that year because of the action of the Government in overtaxing them. Western Australia was not an isolated case. At Warracknabeal, St. Arnaud, and other places in Victoria a. similar question was debated and decided. Honorable senators might call the attitude of the wheat-growers un-Australian. From what I know of the farmers they are not given to taking an un-Australian stand upon any subject, but they were driven into making these decisions by the harsh and merciless treatment of this Government. As my time has expired, I must regretfully resume my seat. I had much more to say.

Senator WOOD:
Queensland

.- lt is most remarkable that Senator Benn, should deal with States other than Queensland in charging the: Government with having failed to encourage primary production. In Queensland there are several important industries which require encouragement and which play a very big part m producing the wealth of Queensland arid of the Commonwealth. One such industry is the sugar industry. No Government has given more attention and consideration to the sugar industry than this Government. .From 1932 to 1946 the price of sugar remained at 4d. per lb. and it was not until 1947 that the Chifley Government permitted a paltry ki. per lb., increase in that price. In 1949 another small rise of id. per lb. was permitted. It was- not until 1951 that a substantial rise of l£d. per lb. was allowed by this Government. That adjustment of the price was handled, so speedily that it must have been a record. I think nhat only a fortnight elapsed between the time when the application was made and the time when the increase was granted. The crushing season was under way and it was essential that action should he taken quickly. I well remember the sympathetic consideration which the Prime Minister gave to the application. Other legislation was put aside in order ro enable legislation relating to the sugar industry to be introduced. The price that had been asked for by the industrywas granted. In March, 1952, costs having increased, the industry represented to the Government that this price had become insufficient. Within the ranks of the industry there had been some dissension and concern because an increase of 2d. per lb. had not been applied for previously. In. March, 1952, the Government allowed a further increase of lid. per lb., and although this was not us much as the industry had asked for. :i rise of 3d. per lb. in the course of nine months was a record rate of increase.

The Government has also set up a committee for the purpose of ascertaining the actual costs in the industry. This com mittee is at present travelling, through Queensland1 and malting investigations in order that it might recommend to the Govern–; cut what price should be paid for sugar. There are three representatives of the Australian Government on that committee a-nd two representatives of the Queensland Government, Mr. Arthur F. Bell, the Under-Secretary of the Department of Agriculture and Stock in Queensland and Mr. P. J. Donnollan, secretary of the .S agar Board. These men will consider the sugar industry case- from Queensland’s point of view. These three actions which have been taken in the course of nine months indicate very clearly the interest of the Government in the sugar industry and the fairness of its attitude towards that industry. Chey evidence the desire of the Government to- encourage primary production and to give fair and honest treatment to an industry that has sometimes, been wrongly regarded in the south and by many members of Parliament. That industry is playing an important part in the development of Queensland. It is the backbone of development in the north.

In February of this year the Government entered into a sugar agreement with the sugar-producing countries of the British Commonwealth. Certain restrictions apply to the sugar industry which have been handed down from the days when there was an over-production of sugar. Because of international agreements, Australia cannot produce as much sugar as it may wish. This agreement, which has been made with other countries of the British Commonwealth, will enable Australia to export up to 600,000 tons of sugar a year instead of 400,000 tons, and will enable it to achieve a production capacity of 1,200,000 tons a year, including the home market. This will result in an increase in the acreage under crop. New farms and new areas will be opened up and millers will be able to enlarge their mills. The agreement will enable soldier settlement to proceed more easily. It will play a tremendous part not only in the development of the sugar industry but in the development of Queensland. Attempts are being made by the Government to arrange an international agreement to conform with this agreement. There are difficulties to be faced. One or two other countries do not desire Australia to have a larger market. Consequently this matter has not yet been finalized. Due to the drought of last year and to the late start of the present monsoonal season it will not be possible to produce the quantity of sugar permitted under the agreement this year, but it will not be long before that level of production is reached. I think that what I have said should clearly indicate to honorable senators that the Government has left no stone unturned to help the great sugar industry of this country in every way possible.

Another industry that has received consideration from the Government is the cotton industry. A guaranteed price of about lod. per lb. was paid for raw cotton, which was equivalent to about 5d. per lb. for seed cotton. Application was made to the previous Government to have the guaranteed price for seed cotton raised to 9£d. per lb. The Chifley Government turned down that proposal, and the Queensland Labour Government was also opposed to it. However, the Menzies Government took the matter up, and has guaranteed a price of 9½d. per lb. for seed cotton. Unfortunately, because of drought conditions, the production of cotton will not be as great as was expected, but it is encouraging to note that new growers have come into the industry because of the guarantee. The production of cotton is important to Australia in time of peace and also in time of war. Unfortunately, the tendency is for the world price of cotton to fall, and it may well be that the Commonwealth, in the terms of its guarantee, will have to find a considerable amount of money to make up the price.

The tobacco-growing industry has also shown remarkable development in Queensland since the present Government has been in office. Some immediate difficulties are being experienced in the disposal of the tobacco, perhaps because of the rapid increase of production, but I have no doubt that those difficulties will be overcome before long. Tobacco.growing could become an important industry in Australia. Queensland is so far away in the north that many people in the southern part of Australia tend to forget all about it. This Government, however, has kept the needs of Queensland steadily in view, and has done much to encourage primary production in that State. The longer the Government remains in office the better it will be for the primary producers of Queensland. The prosperity of that State will be assured, and Queensland will become a strong bastion for the defence of Australia.

Senator ASHLEY:
New South “Wales

– Senator “Wood said that this Government had increased the price of sugar by l$d. per lb., but -he did not say that the reason for the increase was the increased cost of production, due to inflation. The Minister for Shipping and Transport (Senator McLeay), discussing the American loan of 100,000,000 dollars, said that when he was in the United States of America he learned that the authorities there were reluctant to take risks with an Australian Labour government. Let me point out that when Australia faced its greatest peril during the war, and when the late John Curtin appealed to the United States of America for help, that help was given quickly and generously. The Minister’s remark was unfair to the Labour Government. On several occasions Ministers have appealed for the co-operation of the Opposition, but remarks such as that made by the Minister for Shipping and Transport do not encourage us to co-operate.

The Minister also mentioned the contribution which the Commonwealth had made towards financing closer settlement in New South “Wales. I have before me a statement by the Minister for Lands in New South Wales in which he denied that the Commonwealth provided money for the settlement of ex-servicemen on the land to the extent claimed by the Commonwealth. He said that, of the total expenditure of £19.000.000 on land settlement in New South Wales, the Commonwealth had contributed only £600,000, or about 3 per cent., and most of that was paid out in living allowances. A Minister of the Crown should not endeavour to mislead the Senate and the country in a matter of such importance.

The Minister said that it was the policy of the Government to get specially trained immigrants for various industries. My complaint is that immigrants are not chosen with sufficient care. Recently, I was approached in Sydney by three separate groups of New Australians, who asked me where the employment office was. They were out of work. About two weeks ago, I tried to find out how many immigrants were unemployed in Australia, but because of the hush-hush policy of the Minister for Labour and National Service (Mr. Holt), who has issued instructions that no information on this subject is to be released, I was unable to get the information I wanted.

Senator Reid said that the responsibility for increasing primary production rested on the State governments, and with that I agree, but I wonder how he reconciles that attitude with the refusal of the Australian Loan Council to provide sufficient money for the States to enable them to undertake public works.

Senator Cormack:

– The Australian Loan Council did not refuse.

Senator ASHLEY:

– It did. I remember reading about it in the newspapers, and I listened to the broadcast of the Prime Minister (Mr. Menzies). This Government refused to accept the decision of the Australian Loan Council, a decision reached on the unanimous vote of the States. Only the Commonwealth representative voted against the proposal put up by the States. Senator Reid also said that primary production was not being affected by taxation, and in support of his contention that taxes in Australia were not too high he told us what was happening in other countries. The fact is, however, that in order to compare the incidence of taxation in various countries it is necessary to take into account the relative value of their currencies. On that basis, it is evident that Australia, under the rule of the present Government, is not in a favorable position.

The honorable senator also mentioned the increase of railway freights in New South Wales. Freights and fares have increased in every State in the Commonwealth because of inflation. I have before me a newspaper report of a statement by Mr. W. Pratt, general secretary of the Wheat Growers Union, in which he protested against the high taxation of primary producers. I quote the following from the Sydney Daily Telegraph of the 11th March-

page 907

QUESTION

FARMERS IN TAX PROTEST

Primary producers were selling plant and stock to meet taxation demands, Mr. W. W. Pratt said last night.

He said 100 farmers and graziers at Forbes yesterday had decided to protest against “’ punitive “ taxation.

Mr. Pratt is general secretary of the Wheatgrowers Union.

He said that two wheatgrowers had told the meeting they could not meet taxation claims only by selling plant.

Five graziers had said they would have to sell sheep to pay their assessments.

Other farmers and graziers had complained they could not get bank credit to meet taxes.

Mr. Pratt said the Meeting decided the Government could increase primary production only by easing the tax burden on producers.

It decided to ask the Government to:

Abolish provisional taxation.

Make the tax-averaging system optional.

Quite recently, the president of the New South Wales Graziers Association, Mr. C. M. Williams, made an alarming statement about the condition of the primary industries in Australia. He was reported as follows: -

According to Mr. C. M. Williams, President of the N.S.W. Graziers Association if our natural increase in population continues and with an additional 120,000 migrants yearly: By 1960 we would need to better our wheat production of 51/52 by 13 million bushels, meat by 238,000 tons and whole milk by 208 million gallons.

If we do not improve our average post-war production we will be importing vegetables, fruit, eggs, and a great quantity of meat by 1960.

What a prospect for a food-producing country! Mr. Williams has warned us that within ten years we will experience grave shortages of foodstuffs. He is an experienced man, not a member of a political party who seeks to condemn the Government by political propaganda. But we can hope for no improvement of the present position while the wreckers in the Menzies Government occupy the treasury-bench. Indeed, the Government parties are seething with discontent, which has manifested itself even in the Cabinet room. What hope is there of achieving stable government in this country in such circumstances? What hope is there of increasing our primary production? Of what use is it for the

Prime Minister (Mr. Menzies) and the Treasurer (Sir Arthur Fadden) to bleat, like hungry sheep when they see a patch of green grass, about our declining food production? The incentive of primary producers has been destroyed by the high rate of taxation. The Government is now attempting to modify its taxation imposts to a degree and I hope that this will have the desired effect of increasing primary production. If it does not, we will be faced with a very serious position indeed. It is necessary to increase our exports of primary produce in order to balance our overseas funds. The Prime Minister recently made a broadcast appeal to the wheat-growers of this country to increase the acreage sown to wheat.

The ACTING DEPUTY PRESIDENT (Senator Reid).- Order ! The honorable senator’s time has expired.

Senator SEWARD:
Western Australia

– I have not been greatly impressed by Senator Aylett’s speech or by the speeches of other honorable senators in support of the motion that he moved. In the main, they have relied on statistics and the state of our overseas balances. I shall base my remarks not on statistics, but on my practical knowledge of farming. Honorable senators opposite apparently believe that the first essential is to have a plan. Some people evince great love of plans. I remember that Russia adopted a five-year plan, which was followed by other plans. Opposition senators have claimed, in effect, that nothing can be done to increase agricultural production in the absence of a plan extending over a number of years. Generally speaking, the people who draw up plans in connexion with primary production are the State Ministers of Agriculture and their expert advisers. I once heard a farmer who was unable to read exclaim, “ God protect me from the experts ! “ I have never heard a member of the Opposition, when speaking about these plans, suggest that there should be consultation with the farmers. I travelled through the farming districts of Western Australia recently, just after the first rains of the season had fallen, and it made my heart glad to see the optimism and enthusiasm of the farmers:

It -was indeed an inspiration to see them wanting to get on with cultivation, but many of them couldn’t get on with the the working of their properties because of the lack of machinery and spare parts. However, just before I left Perth to attend the current sittings of the Senate I spoke to the director of a company who told me that although he had orders for 300,000 cultivator points there was not one cultivator point obtainable in Perth. Fortunately, arrangements have been made for a 3hip to bring steel to the west from the eastern States and now the manufacture of cultivator points in Perth is under way. Rut, of course, it is late to be doing that.

Had Senator Aylett studied his subject more thoroughly before addressing the Senate, he would have found that the decline of agricultural production is attributable in no small degree to the shortage of machinery which has been brought about by the shortage of coal and steel. Manufacturers of agricultural implements could do much to overcome the shortage of farming equipment if adequate supplies of steel were available. It has become necessary for Australia to import steel. Just imagine our having to import steel from Belgium, a country that was almost blasted off the earth during World War II., and galvanized iron and piping from Japan, which was blasted by the atomic bomb ! A Western Australian farmer has told me that, he ordered a header in 1947. When, in 1950, ho was told that there were still no prospects of his obtaining the machine, he transferred his order to another merchant, only to be told that he should not expect to obtain it before “1956. In desperation the farmer said to me. “ I have reduced my area of wheat in order to try to make the old machine last until I can get the new one. What else can I do ?” Another farmer, who had just received a taxation assessment for £36,000, told me, “My header might hang out for this year, but if il cannot get a new one for next year I shall have to go out of wheat.growing “. Of what use is at for honorable senators opposite to state that heavy taxation has been responsible for the decline of our primary production? Farmers have not planted a crop since the heavy taxation of last year. I am not suggesting that the presenthigh taxation, if continued,willnot have the effect of reducingthe incentive of the farmers, but certainly the huge decline of wheat production last year is not attributable only to taxation imposed by this Government. When the Opposition claims that the decline has been caused by taxation imposts, it must realize that Labour was responsible for the rates of taxation of which they complain. I believe that the decline of primary production is due mainly to the inability of the farmers to obtain new machinery. A survey by Dr. Gentilli revealed that in Western Australia no less than 1,000 each of ploughs, harvesters, combines, and drills were required. The shortage of agricultural machinery is crippling production. To those honorable senators who attach great importance to statistics, I point out that despite the hardships confronting the farmers of Western Australia, the decline of primary production in that State has been much less than the decline in other States. When Queensland and Tasmania want wheat, they ask WesternAustralia or South Australia to supply it, but have the colossal impudence to expect the producers of those States to bear the cost of transporting the wheat to where it is required.

The shipping service to Western Australia is totally inadequate. I know of an instance recently when a ship was held up in that State for seven days to load 500 tons of cargo. As the charges amounted to £450 a day, it cost over £3,000 to load that cargo. The captain of the vessel told me that it would be transferred to another service, because the average time of loading and unloading in England was only nine days, compared, with six weeks in Australia. The slow turn-round of ships in this country was a matter for comment before this Government came to office. Honorable senators opposite have criticized the Government’s attempts to curb inflation. I remind them that a certain period of time must elapse before the result of steps that this Government has taken will be apparent. The present serious deficiency of farm labour available in Western Australia is another factor that is retarding primary production.

Although honorable senators opposite haveevinced a certain anxiety about unemployment in this country, I am convinced that employment is available for every person who seeks it. Advertisements have appearedin the Western Australian newspapers recently for farm labourersat £18 aweekand accommodation. I understand that very few applications have been received. The reason is that men were enticed from the farms into secondary industries during Labour’s regime. Generally speaking, the amenities provided for workers in rural areas cannot compare with those provided in the cities, with the result that it is not easy for farmers to obtain labour. An honorable senator has referred to the closing of a cotton waste factory in Western Australia. That factory, which employed six men, could not guarantee to supply the Western Australian railways with all of the cotton waste that it required for a year, and consequently lost thecontract. However, it was not worthkeeping in existence, because it is cheaper to import cotton waste. The labour previously employed by the manufacturer could more profitably be employed on the farms.

When I made my maiden speech in this chamber during the debate on the motion for the adoption of the AddressinReply to His Excellency’s Speech, I pointed out that it was incumbent on the Government to decide whether Australia should continue to be primarily a foodproducing country, or whether emphasis should be laid on secondary production. If we are to remain a primary-producing country I contend that labour should be diverted onto the farms in order to increase production. The gift duty, which was introduced by the former Labour Administration is having a most, unfortunate effect on farmers. In many instances farmers who have reached an advanced age wish to make their farms over to their sons. Last year three cases of the severity of this impost were brought to my notice. In the first instance a farmer was required to pay so much gift duty and income tax, upon transferring his farm to his son, that subsequently, he had to borrow money from his son in order to paint a town residence that he had purchased. In the other two cases the gift duty levied was so high that the money left in the hands of the former owners of the properties was only a little more than would be sufficient to disqualify them for the age pension. The severity of this impost is having a very serious effect upon the. continuance on the land of the young sons of men on the land who constitute the best farmers we can obtain.

Senator Aylett:

– Does the honorable senator advocate, the abolition of the gift duty?

Senator SEWARD:

– We have already repealed some of the obnoxious measures that were introduced by Labour governments.

Reference has been made to the decline of wheat production. The production of wheat has declined in recent years principally because of the provision inserted in the wheat legislation by the Labour Government under which farmers are compelled to sell their wheat at below the cost of production. Because farmers have found the growing of wheat unprofitable they have turned to the growing of oats and other coarse grains.

There has also been a decline in the production of meat which has resulted from the infernal fifteen years’ meat contract with the United Kingdom under which Australian meat is sold to the United Kingdom at prices lower than those that could be obtained for it elsewhere. That agreement has ruined the Australian meat industry. The Australian Meat Board, which does not voice the opinions of meat producers, has recommended the renewal of the agreement. We hope that in the near future the constitution of the board will be altered and that that body will thereafter express the views of the producers.

I urge honorable senators to go among the primary producers and discuss with them the reasons for the decline of food production. They will learn that in Western Australia, if not in all States, the decline is due, first, to the shortage of machinery; secondly, to the shortage of labour; and, thirdly, to the inability of farmers to obtain their requirements of superphosphate. This Government cannot be blamed for the existing shortage of superphosphate which results from the decision of American manufacturers to decrease the export of that commodity. Sitting suspended from 5.1$ to 8 p.m.

Senator COOKE:
Western Australia

– The contributions that have been made to this debate by honorable senators opposite do not, of course, amount to an admission that, as a result of the ineptitude of the Government, a very serious position exists in relation to food production. It is obvious that the Minister for Shipping and Transport (Senator McLeay) and other honorable senators opposite do not appreciate the seriousness of our food position. It is also apparent that they do not hold the Government responsible for that position. They base their defence on the assertion that the decline of production is attributable to the Chifley Government and that blame for that decline should be laid, at its door. Peculiarly enough, when the Minister for Commerce and Agriculture (Mr. McEwen) was addressing the 34th meeting of the Australian Agricultural Council at Canberra on the 25th February, he adopted for the purposes of illustrating the decline of primary production, figures which related to the year 1947-48, at which time a Labour government was in office. Honorable senators on this side of the chamber may therefore discount the abusive attacks which honorable senators opposite have made upon the Chifley Government concerning its alleged responsibility for the decline of food production. The Minister also stated on the occasion to which I have just referred, that exports of frozen beef had declined by 35,000 tons since 1947-48, to 70,000 tons in 1950-51. He further stated that exports of lamb had declined to 20,000 tons by 1950-51, and that the acreage under wheat had declined considerably by 1951. I ask the Government to adopt a serious attitude towards this problem, which should be analysed in order to see whether its policy has not largely contributed to the decline.

Honorable senators opposite have alleged that taxation has nothing to do with the decline of primary production. Senator Reid compared the rates of income tax applicable in New Zealand wilh those applicable in Australia and pointed out that rates are higher in New Zealand. I remind the honorable senator that this Government has increased income tax by 10 per cent, and has drastically curtailed the deductions which are allowable to farmers. When the Australian Labour party was in office, superphosphate was subsidized. Although taxes were heavy, a certain amount of the total sum paid by farmers was returned to them to be put into the land. The Labour Administration allowed a deduction of 40 per cent, in respect’ of plant depreciation. The present Government apparently does not agree with that policy. In fact, the Treasurer (Sir Arthur Fadden) has stated that no further deductions along those lines will be allowed. Yet, when the Minister for Commerce and Agriculture addressed the State Ministers for Agriculture, who are responsible for the prosecution of a policy intended to increase primary production, he adopted, as the basis of an increased food production plan, the production achieved in a year during which Labour was in office.

Senator Scott:

– But only for five years !

Senator COOKE:

– The increased production plan could have been extended for an additional five years had the policy of the Australian Labour party been adopted. Had that policy been followed, farmers would have been able to obtain equipment with which to make their farms efficient. Results would have been apparent before very long. This Government is concerned only with the harvest which it is able to collect from the farmers. It has discontinued the subsidy on superphosphate.

It appears that the Government believes that in a time of crisis it has merely to snatch a catch-cry from the air and talk about increased production, although it has discontinued remissions in respect of plant depreciation, deductions from income tax, and subsidy on superphosphate. Income tax, plus provisional tax, in many instances absorb more money than the farmer earns by way of income. The farmer works as hard and is as loyal as any other member of the community. He does not need people from Korea or from Japan as requested by a Government senator when he sought admission of Asians to work in our industry in which he had a personal interest. All that he requires in order to operate efficiently, is reasonable assistance from the Government. If he is obliged to pay heavy taxes to the Government, he wishes to receive something in return, so that he may improve the productivity of his land and introduce efficient farming methods.

Honorable senators opposite have stated that farmers are not able to obtain labour. I suggest that if the Government is aware of that fact it should assist them to get labour. Instead, its attitude appears to be that labour will not be made available unless excessive payment is made for it. Senator Seward referred to the shortage of plant and machinery. I ask the honorable senator who is responsible for that shortage. When the Australian Labour party was in office it helped to build up primary industries by stabilizing secondary industries, on which primary industries depend for their supplies. The present Government raised a loan of 100,000,000 dollars, ostensibly for the importation of machinery. Although that large sum of money has been in the hands of the Government for eighteen months only half of it has been expended. Interest is being paid on the remaining half. The Government, nevertheless, told the farmers that there were obstacles in the way of obtaining credit with which to procure machinery. I have never yet been able to obtain a reasonable explanation from the Government concerning dollar expenditure. Apparently, not a great many dollars have been expended on the importation of farm machinery. Yet a most extraordinary position has arisen in relation to tractors. Australian tractors are available on the market and in -fact are unsaleable. In Melbourne, imported tractors are also unsaleable. The Government has allowed that curious position to develop.

The farmer makes his plans a year ahead. I have associated with many of them and I know that in some instances they are not prepared to plant crops because the high rate of income tax will absorb more than they receive from the sale of such crops. This Government is aware of that position, but it is not prepared to pass back to the farmers a proportion of the taxes they are called upon to pay. I could supply the names of several farmers, who, although willing to extend their acreage under wheat, have not received any encouragement to do so from the Government, either by way of tax remissions or of assistance to obtain machinery. “When Labour was in office a great deal of trouble was taken to transport to Western Australia 50 tons of cultivator points, which were urgently required. That consignment was made at a time when transport was highly organized for war purposes.

Senator Reid has asked whether the Opposition considers that expenditure on defence should be curtailed. My reply to the honorable senator is that food is one of the most important factors in defence. The husbandry of our land, so that it will produce and sustain our own troops and those who may be sent to this country, is more important than placing a rifle in the hands of a boy of fourteen years of age and putting a rough collar round his neck.

L do not believe that it is even necessary to open up new land, to sweeten sour land and to take measures of that kind in order to increase food production. There is a great deal of arable land in Australia which is not being properly utilized. I doubt whether the Government is prepared to take action against land-owners who hold more land than they cultivate. The policy of the Government should be so ordered that it will give to the farming community the consideration which was given to it when the Australian Labour party was in office.

The PRESIDENT:

– Order ! The honorable senator’s time has expired.

Senator WRIGHT:
Tasmania

– I rise to parry the wavering finger of criticism that has been pointed by the Opposition to-day in support of its claim that the Government has failed to expand our agricultural industries. I pause at the outset to- inquire from whom emanates this motion ? It has been submitted by no 1pr.= a nonentity than Senator Aylett, who is about to depart sorrowfully from our midst at the behest of the Tasmanian Labour party. So enthusiastic is he about this debate that he i3 not now in the chamber. This self-styled protagonist of the primary producers once debated with me the subject of bank nationalization. He was one of those who sought to force bank nationalization upon the primary producing community of the Commonwealth. I have in my hand a report submitted by a committee to the Chifley Government, of which the honorable senator was a supporter. It recommends the complete nationalization of the land in this country. Presumably acting upon the advice contained in that report, members of the then Government who now properly sit on the Opposition benches, introduced, as an example of their land nationalization plans, a war service land settlement scheme under which exservicemen were to be granted not freehold land, but only leases in perpetuity. Coming to more recent days, what has been the fate of attempts by the Menzies Administration to persuade the Labour bucolics of Queensland and New South Wales to increase the price of butter and cream in order to give an incentive to dairy-farmers to increase production? Vincent Gair, Premier of Queensland, promptly passed through the one-chamber Parliament of that State, dominated by Labour socialism, legislation which conferred upon the Queensland Government power to remove elected representatives of the dairy-farmers from various boards, to replace them with Government nominees, and to compel dairyfarmers to deliver their products to those boards at fixed prices. Earlier to-day, Senator Reid cited examples of extortionate increases of freight rates in New South Wales. A similar position exists in Tasmania. . This Government came into power after an exhibition for eight and a half years of the most unrealistic theoretical economic planning that we have- ever known. Those years are referred to by some of the late Mr. Chifley’s erstwhile supporters as the “ honeymoon period “. The Menzies Government was faced with the task of strengthening the arterial industries of this country so that primary producers could obtain the basic materials that they required to increase production. That task has- been successfully tackled. There has been a significant increase in the production of black coal, not only in New South Wales, but also in other parts of the Commonwealth. The output of superphosphate has been increased from 1,423,000 tons to 1,576,000 tons annually. Notable increases have also taken place in the production of pig iron, ingot steel, and other basic materials required for the production of fencing wire, wire netting, and farm implements. When we remember that the Menzies Government was strangled for a period of approximately eighteen months by the humbugging tactics in this chamber of some honorable senators whom I have the displeasure of addressing to-night, the increases of production to which I have referred appear even more meritorious. I remind the Senate too, that the influence of our Prime Minister overseas helped us to secure a dollar loan which has enabled us to buy many millions of pounds worth of agricultural machinery from America.

Senator Hendrickson:

Senator Hendrickson interjecting.

Senator WRIGHT:

– It is ironical indeed to hear Senator Hendrickson say, “ You are crushing the farming community with heavy taxes “. That allegation is complete humbug. The needs of the primary producer have been made a political football by the desperate near ex-senator who has moved the motion now before the Senate in an endeavour to recapture the support of the Labour executive in Tasmania for his Senate candidature. The truth about taxation is that whereas a farmer who earned £1,000 six. or seven years ago lost £355 of that sum to the Chifley Government; to-day, a fanner who earns £1,000 loses only C14S 10s. in income tax.

There are amongst us to-night some honorable senators who have criticized the Government for not supporting the attempt by the States to secure everincreasing allocations of loan funds. 1 remind them that loan allocations have risen from £75,000,000 in 1949 to the latest figure of £315,000,000 sought by the States. Last year the Commonwealth accepted the responsibility to provide from revenue no less than between £150,000,000 and £160,000,000 to enable work to bc continued on essential works such, as hydro-electric power schemes. In spite of the fact that our wool income has decreased from £650,000,000 in 1950-51 to an estimate of £360,000,000 in the current financial year, these squander maniacs who sit on the Opposition benches want the Government to go on loading the community with loan commitments. And at whose expense? They want us to do so at the expense of that section of the community which is the backbone of our economy and the main contributor to our prosperity. The policy of this Government is to support public undertakings designed to supply the farming community with power and other essential services, hut it will not strain the economy by raising loanE which neither the farmers nor any other section of the community will have a chance of repaying without severe hardship.

The provisional tax system to which Senator Cooke has referred is a legacy from the Chifley Government. This Government’s action to correct an obvious injustice has been prompt and timely. It has decided to forego 40 per cent, of that iniquitous levy. Under legislation now on our notice-paper, the amount of provisional tax to be paid next year will be nominated by the taxpayer and not arbitrarily assessed by the taxation authorities in accordance with the directives of the Chifley Government. We have introduced a provision whereby farmers, and farmers alone, shall be entitled to a depreciation allowance of 20 per cent, on buildings erected on their properties, and having sanctioned that allowance we shall not insist, as the Chifley Government did, that, at a later stage, the item shall be included for income tax purposes. Surely even a most humble intellect, such as that of the honorable senator who initiated this debate, will appreciate the need to assist primary producers to house their employees by allowing expenditure on such work to be deductible for income tax purposes. That is a concession that will be welcomed by the entire farming community.

The land tax was, of course, Labour’s baby. It was introduced in pursuance of the belief that large estates should be broken up. The levying of the land tax on the basis of 1951 values imposed undue hardship on primary producers, and the Government has acted immediately to remedy the situation. Under the land tax legislation now on our notice-paper, the number of property owners liable to pay the tax is to be reduced from 43,000 to to 22,000. The exemption level is also to be raised by an amount which, on the mainland, will correspond to the increase of assessments. I am waiting with real interest to hear the views on the land tax proposal of those members of this chamber who, in the terms of the motion now before us, profess a sympathy with the primary producer. If I am not mistaken, later to-night or some time tomorrow, like their colleagues in the House of Representatives, they will go on record as bitter opponents of the concessions that the Government has provided in its land tax legislation for the benefit of farmers. With regard to the economic policy of this Government I remind the Senate that some members of the Opposition are amongst those who increase the costs of farmers by fomenting industrial unrest, which, of course, is reflected in higher prices for farm equipment. These are the people who seek to re-impose prices control on the farmer so that his hides and hops and potatoes will be supplied to the market at an unfair price.

The PRESIDENT:

– Order! The honorable senator’s time has expired.

Senator O’FLAHERTY:
South Australia

– Senator Wright has put up his usual smoke-screen behind which to hide from the charge that has been made by the Opposition. The charge against the Government is that it has not kept the promises that it made prior to the last general election and that it has not made any serious effort to improve production. Senator Wright referred to many subjects without dealing with the matter that he should have debated. In order to determine this issue it is necesssary to ask what promises were made by the Government before it came to office and what it has done since. Prior to the last election the Government promised to put value back into the £1 ; it promised to introduce a price stabilization scheme; and it promised to stabilize the economy of this country. For the purposes of this debate, it is necessary to ascertain whether the Government has set forces in motion which would give effect to these promises. Honorable senators opposite have said that railway freights have risen out of sight, particularly in New South Wales. But railway freights have been increased throughout Australia both by Liberal and Labour governments. They have not been raised with the object of affecting primary production. They have been raised because the inflationary spiral has risen so high that it has been necessary to increase railway freights in order to meet the commitments of the railways. The State governments have been forced into taking that action by the inactivity of the Australian Government. Even the AttorneyGeneral on one occasion told the Senate that the Opposition knew nothing about inflation because the inflationary spiral had not commenced during the term of the Labour Government, but had only started at the end of the year 1949. In other words, the spiral started when this Government took office and the Government has made no attempt to overcome the difficulty.

The Government has introduced budgets and promised to take certain other action, but in taking that action it has lost the trust of the people, arid particularly of the primary producers. Because the primary producer has no trust in the Government he will not do what the Government wants him to do and what he would do under ordinary circumstances. Most of what I should like to say about the Government would probably be considered unparliamentary, but I can say that the Government was elected as the result of a confidence trick. It made promises which it has now found that it cannot fulfil. The Government has confiscated 20 per cent, of the gross income of some primary producers. No doubt when the Government prepares its next budget it will find that it is in an even worse position, and that it will have to take further action of a similar nature. The Government has removed the averaging provisions of the income tas legislation, with the result that an additional £47,000,000 must be paid by the primary producers. That is what the Government has done to stabilize the economy of this country. How can the Government expect the farmer to produce more when- it is constantly undermining his trust in it? The farmer is not prepared to produce what he would normally produce because he is not sure whether he will not get it in the neck when the next budget is prepared. Consequently, primary producers are looking after themselves and allowing the Government to stew in its own juice. Opposition senators are not the only ones to contend that primary producers have not received a fair deal. The I.P.A. Review is a journal which usually supports the Government, but on page 40 of the March-April issue of that publication, the following comment appeared : -

The wheatgrower is asked why he won’t grow more wheat and the dairy farmer why he won’t produce more butter-fat, and they retort in similar vein : “ We are not going to take the risk of cropping more wheat or running more cows when the Government will take more than we get out of the extra return.”

On page 42 of the same issue, the I.P.A. Review states -

The primary producers in the very top brackets derived their phenomenal incomes almost entirely from woolgrowing but there is still a considerable number with gross incomes around £1,000 per annum who must make decisions whether or not they shall plant more wheat or expand their dairy herds or increase their deliveries of fat lambs and pigs to markets. It is here that high levels of taxation tend to build up a psychological antipathy to appeals to greater output of food. Primary producers were not used to paying heavy taxes in the past and they resent the fact that the community wishes to share in what may now be a fortuitous prosperity. Farmers have got it into their heads that the Government is getting too large a share oftheir returns and a substantial cut in income tax levels may be all the encouragement they need to expand their acreages or increase their herd and flocks.

Even the Government’s own supporters have been kicking up a row about this matter because it has been twiddling with the economic position of the country. It has shifted from one position to another in order to get out of its difficulty. Primary producers’ organizations have also asked why the Government cannot regain the confidence of the community. A short article in Muster, the graziers’ journal, reads as follows : -

There would be nothing surprising in the need for unceasing vigilance and constant battling by such an organization as the Graziers Association of N.S.W. during the term of office of a Government pledged to socialist objectives and openly committed to immediate policies inimical to’ the interests of the man on the land. But that such a body should be forced by its duty to individual members, to assert certain free principles and combat Canberra propaganda when a Government professing a liberal philosophy and including men elected to represent rural interests is in power - this is at once alarming and disillusioning.

It is obvious that the Graziers Association is not satisfied with the policy of the Government. Although primary production has been affected by acts of God, such as drought and fire, the main reason for its decline is that the Government has not given the farmer any incentive to produce more. Foodstuffs are urgently required and will be more urgently required in the near future, not only for home consumption but also for export, so that Australia may build up its overseas balance. The policy of the Government has resulted in its losing the confidence of the people and of the farming community in particular. As I have said, -primary producers are not able to forecast when they will again get it in the neck from this Government.

Senator McMULLIN:
NEW SOUTH WALES · LP

– I have listened with great interest to this debate, and I commend Senator Aylett for having introduced this important subject. I had hoped that members of the Opposition would give us the benefit of some constructive ideas, but I was disappointed. Honorable senators opposite have quoted from pamphlets and policy speeches, but they have contributed nothing original. They have claimed to be the friends of the farmers, but they have overlooked some very important points.

Debate interrupted under Standing Order 64.

page 916

SUPPLY BILL (No. 1) 1952-53

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spicer) read a first time.

Second Reading

Senator SPICER (Victoria - Attorney-

General) [8.48]. - I move -

That the bill be now read a second time.

This bill provides for an appropriation of £149,028,000 to carry on the necessary normal services of government, other than capital services, for the first four months of the financial year 1952-53. The amount required may be summarized under the following heads : -

The bill provides for the carrying on of essential services approved by the Parliament in the Appropriation Act 1951-52. Honorable senators will, however, appreciate that, under present-day conditions of rising costs for wages and materials, it is not practicable to limit the provision to the rate of expenditure provided for in the 1951-52 Estimates. The amounts included in the bill have, therefore, been calculated on current rates of expenditure.

The amount of £62,024,000 for “ Defence Services “ provides for expenditure on the defence programme and requirements in Korea and Malaya, whilst the amount of £6,209,000 under “ War and Repatriation Services “ covers expenditure on repatriation and rehabilitation, and other post-war charges.

The amount of £15,000,000 for “ Advance to the Treasurer “ is required to enable the payment of the special grants to the States of South Australia, Western Australia and Tasmania to be continued pending the report of the

Commonwealth Grants Commission; to cover unforeseen and miscellaneous expenditure, and to provide for any unexpected defence requirements. Except in relation to defence, no amounts are included for new services.

Debate (on motion by Senator McKenna) adjourned.

page 916

SUPPLY (WORKS AND SERVICES) BILL (No. 1) 1952-53

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spicer) read a first time.

Second Reading

Senator SPICER:
AttorneyGeneral · Victoria · LP

– I move -

That the bill be now read a second time.

This bill appropriates an amount of £36,504,000 to enable Commonwealth works in progress at the 30th June, 1952, to be continued until the 1952-53 budget is passed by the Parliament. Programmes for capital works are in operation under the major Commonwealth departments, including the Department of Works and Housing, the Postmaster-General’s Department, and the Department of Civil Aviation. To enable these programmes to be continued successfully, it is necessary that funds be available without interruption for the purchase of materials in advance, and also to ensure continuous employment on the many projects. Provision is therefore made in the bill for four months’ expenditure on works included in the expenditure programme of £115,408,000 provided for in the capital Works Estimates 1951-52, and in the Additional Estimates 1951-52. In accordance with the usual practice in submitting a Supply Bill, no provision has been made for any new services.

Debate (on motion by Senator McKenna) adjourned.

page 916

APPROPRIATION BILL (No. 2) 1951-52

Bill received from House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spicer) read a first time.

SecondReading,

Senator SPICER (Victoria - Attorney-

General) [8.55]. - I move -

That the bill be now read a second time.

The purpose of this bill is to seek parliamentary approval for expenditure in excess of the 1951-52 Estimates inrespect of certain items. The total of the additional expenditures for which provision is sought is £28,000,000. However, expenditure is expected to fall short of the Estimates in respect of certain other items to a total of about £23,000,000, Therefore, in the net result, total expenditure in 1951-52 is likely to exceed the budget estimate by about £5,000.000 only. The main items of additional expenditure for which authorization by the Parliament is now being sought are as follows : -

The main items in respect of which expenditure is expected to be less than that provided for in the 1951-52 Estimates, are as follows: -

The additional provision required for defence services is made up of many items spread over the whole defence field. In the aggregate, these increases total £11,600,000; but against these are savings on other items estimated at £8,800,000, so that the net additional authorization required is estimated at £2,800,000.

An additional £2,500,000 is required f or immigration, principally to cover costs of assisted British immigration and certain losses on immigration hostels. On the other hand, there will be offsetting re ductions in expenditure on Dutch, Italian and other European immigration schemes, and on a number of other items, amounting in all to £2,100,000.

For war and repatriation services, an additional £1,400,000 will be required for a number of items which are set out in the bill, but these will be more than offset by savings on the budget Estimates of £1,800,000. For example, expenditure on reconstruction and rehabilitation is expected to be about £600,000 lower than the budget Estimates.

The items of capital works and services for which additional provision is required are the following: -

Against this, expenditure is expected to fall short of Estimates in respect of -

An item in respect of which the outgoing from Consolidated Revenue is expected to be substantially less than was estimated in the budget is the statutory transfer to the National Welfare Fund. As honorable senators will know, the amount transferred to the fund is dependent on the yield of the pay-roll tax, and since this is likely to be lower than the budget estimate, the amount to be transferred to the National Welfare Fund will also be lower than the figure shown in the budget.

Expenditure on international development and relief will fall short of the budget Estimates, partly because about £500,000 less than was estimated will probably be expended on Korean relief, and about £4,500,000 less than was estimated will be expended under the Colombo plan. As indicated in the recent statement by the Government on the economic position, it is not possible yet to forecast exactly the outcome of the 1951-52 budget. Even at this stage in the financial year, it is not possible to make precise forecasts of revenue collections. For the reasons given in the statement on the economic position, however, revenue from income tax will be appreciably lower than the estimate, while revenue from sales tax, pay-roll tax and postal revenue will also be lower. On the other hand, customs and excise revenue will certainly surpass the budget estimates. As honorable senators will recall, the budget provided for a surplus on the year of £114,500,000. It seems certain that the actual surplus will be less than that figure, possibly by a substantial amount. A more detailed statement on that subject will, however, be made when the financial results for the year, particularly on the revenue side, can be determined more accurately. I commend this bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

page 918

APPROPRIATION (WORKS AND SERVICES) BILL (No. 2) 1951-52

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spices) read a first time.

Second Reading

Senator SPICER:
AttorneyGeneral · Victoria · LP

– I move -

That the bill be now read a second time.

In my second-reading speech on the Appropriation Bill (No. 2) 1951-52 foiordinary services I indicated that it was necessary to seek an additional appropriation of £16,560,000 for capital works and services. This bill will give effect to that appropriation.

Debate (on motion by Senator McKenna) adjourned.

page 918

WAR PENSIONS APPROPRIATION BILL 1952

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator .Spices) read a first time.

Second Reading

Senator SPICER:
AttorneyGeneral · Victoria · LP

– I move -

That the bill be now read a second, time.

This bill provides for an appropriation of £34,000,000 out of the Consolidated Revenue Fund for the payment of war pensions. It is necessary to submit a measure of this nature to the Parliament from time to time for the purpose of appropriating from revenue an amount for payment into a trust account to enable pensions to be paid in accordance with such rates as are approved by the Parliament. Expenditure on war pensions is showing a continuous increase, as the following table indicates :

The amount of £34,000,000 now requested will cover approximately a year’s expenditure at present rates. The bill has no relation whatsoever to the rate’s or conditions under which pensions are paid. It merely authorizes the provision of funds for the trust account from which war pensions are paid.

Debate (on motion by Senator McKenna) adjourned.

page 918

SUPPLEMENTARY APPROPRIATION BILL 1950-51

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spicer) read a first time.

Second Reading

Senator SPICER:
AttorneyGeneral · Victoria · LP

– I move -

That the bill be now read a second time.

The supplementary appropriations total £9,596,S29, and relate to the financial year 1950-51. The amounts set out in the bill have been expended out of a general appropriation from revenue of £15,000,000, which was made available to the Treasurer to meet expenditure which could not be foreseen when the Estimates were prepared. It is now necessary to obtain specific parliamentary appropriation to cover the several items of excess expenditure.

Full details of the expenditure for 1950-51, which includes these increases, are set out in the Estimates and budgetpapers 1951-52. The Estimates papers show the amount voted for 1951-52, together with the amount voted and the actual expenditure for the previous year, which is included for informative purposes. Details are also included in the Treasurer’s financial statement for 1950-51, which has been tabled for the information of honorable senators. The bill gives in detail the items under which the additional amounts were expended by the various departments. The chief items, in round figures, are -

Any further details of the various items of expenditure will be available at a later stage.

Debate (on motion by Senator McKenna) adjourned.

page 919

SUPPLEMENTARY APPROPRIATION (WORKS AND SERVICES) BILL 1950-51

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spicer) read a first time.

Senator SPICER (Victoria - Attorney-

General) [9.13]. - I move -

Thatthe bill be now read a second time.

The total appropriations passed by the Parliament for capital works and services under this heading during 1950-51 amounted to £80,173,000. The actual expenditure was £72,644,000, that is, £7,529,000 less than the appropriation. However, due to requirements which could not be foreseen when the Estimates were prepared, certain items show an increase over the individual amounts appropriated, and it is now necessary to obtain parliamentary approval to cover these increases. The excess expenditure on the particular items concerned totals £2,853,295, which is spread over the various works items of the departments, as set out in the schedule to the bill. Any details which may be required by honorable senators will be furnished at a later stage.

Debate (on motion by Senator McKenna) adjourned.

page 919

LAND TAX ASSESSMENT BILL 1952

Debate resumed from the 21st May (vide page 546), on motion by Senator Spicer -

That the bill be now read a second time.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The purpose of this bill is to increase the statutory deduction allowed to resident land-owners in Australia from £5,000 to £8,750. This proposal follows the new basis of land valuations that was adopted only a few months ago under the budget proposals. Under the latter proposals 1939 values were discarded in favour of values at the 30th June, 1951, which were regarded as actual values. The Treasurer (Sir Arthur Fadden) estimated the additional revenue that the Commonwealth would derive from the change at £4,000,000. In the previous year the yield amounted to £3,500,000. In other words, the right honorable gentleman indicated that the yield would he more than doubled. When the Treasurer announced the new impositions in his budget speech, he said -

The unimproved values of all types of land have increased very substantially over the values at which they were pegged. The effect of the increase in unimproved values will be to bring into the taxable field for the first time the land of a large number of land-owners.

I invite honorable senators to note that statement particularly, because we shall undoubtedly hear something to the contrary from the Treasurer very soon. As I have indicated, the Treasurer pointed out that the new proposals would bring a large volume of land-owners into the taxation field for the first time. He continued -

The increase in revenue from this source in thecurrent financial year is estimated at £4,000,000.

I say at once that the decision of this Government to more than double receipts from land tax at a time of credit restriction and inflation, when all persons concerned with business, particularly the owners of land, were in great difficulties, was particularly unfortunate. When we scan this bill we might be inclined to say, “ Here is some relief from taxation because the statutory deduction is to he increased from £5,000 to £8,750”. It would be quite wrong to look at the bill by itself. It must be viewed in its proper setting, and in order to do so we must go. back to the events that took place even before last year. This Government went to the people on two occasions with promises to reduces taxes and with a very clear and emphatic promise that the burdens of government would be reduced. In October last the first promise was completely broken.

Senator Spicer:

– There was a war in Korea.

Senator McKENNA:

– I understand that there is no war in Korea. The Attorney-General (Senator Spicer) should know, if he does not do so, that the High Court has so held.

Senator Spicer:

– There are Australian servicemen in Korea.

Senator McKENNA:

– Let me pursue the interjection of the Attorney-General.

Doe3 the Minister suggest that the vast increase of taxes of £472,000,000 in a year which was made by the Government was necessary because of war in Korea? I remind him, that in another place only a few days ago the Minister for Defence (Mr. McBride) stated that from July, 1950J to the end of April. 1952 - nearly two years of what the Attorney-General is pleased to call a period of war in Korea - the Government lias expended only £13,250,000 on defence.

Senator Spicer:

– On the defence programme.

Senator McKENNA:

– The AttorneyGeneral is shifting his ground. He would do better to leave the financial position alone, at least for the time being.

This proposal is in consonance with the form of Government policy. It is clear now to the people that it is the policy of the Government to make promises and to break them, and to make decisions and, in a very short time, either to fail to implement them or to do the exact reverse of what is decided. The decision of the Government to alter the basis of assessments is ill-timed and ill-judged.

Senator Spicer:

-What other basis could have been adopted ?

Senator McKENNA:

– The AttorneyGeneral should know that in a difficult period such as this is the status quo should be preserved, and that the basis of values which has served since 1942 should, be maintained, more particularly by a government which is honorably pledged to reduce taxes.

Senator Gorton:

– That is what this bill proposes to do.

Senator McKENNA:

– That is true if we ignore the fact that prior to the introduction of this measure the Government made a move which cost the landowners of this country £4,000,000. This bill will merely give to land-owners a” rebate of approximately £678,000 of that amount. In the final analysis the landowners will be more than £3,250,000 worse off than they were in former years. Government supporters should not raise too many cheers about the relatively minor concession contained in this measure.

With a note of triumph the Treasure)’ and the Attorney-General gave the figures concerning the large number of new taxpayers who will be brought into the taxable field by this legislation. Listen to the words of the AttorneyGeneral - lt is estimated that the increased values would bring within the operation of the tax about 22,000 new taxpayers who had not previously been required to lodge returns.

There were cheers when the Treasurer roped in an additional 22,000 taxpayers, but within five months he has let them out again! Need I say any more in justification of my claim that this decision of the Government in relation to land tax was completely ill-judged and ill-timed? Otherwise, why was there such a reversal of policy? The landowners of Australia may well ask why. in a year when the Government was budgeting for the surplus of £114,500,000. it was necessary for the Government to scrape the very bottom of the pot in order to rope in the last land-owner in the Commonwealth? Was the need so urgent, or was the Treasurer so bent on effectively breaking his promises that he had to scout in new fields for additional revenue? I do not know whether his action was an exhibition of sadism on the part of the Government; it was certainly so regarded by the land-owners. Why did the Treasurer have to ask for an additional £4,000,000 from the landowners of the country at a time when he was already raising an additional £468,000,000* in taxation of all kinds from the people? Having decided to increase company tax, individual income tax, sales tax, excise, broadcasting licence-fees, postal charges, and the rest, apparently the right honorable gentleman thought he might as well catch the last fish in the sea.

I have had some communication with the Treasurer on the subject of land taxation. In a letter which I received from the right honorable gentleman on the 21st March last he dealt with the basis upon which valuations of land are made. One paragraph of the letter reads -

The valuations determined by the Valuation Section of the Taxation Department are arrived -at by a comparison of sales of comparable properties following an exhaustive review of values throughout the Commonwealth. If taxpayers are dissatisfied with the unimproved values .placed on any land by the Department, they have a right of objection and appeal to the Valuation Boards or to the Courts to ensure the correctness of the departmental valuations.

I trenchantly criticize the basis of valuation that has been adopted by the Government. Why should it have adopted 1950-51 values, as it appears to have done, when by so doing it must inflict a great injustice on land-owners? This bill indicates acceptance by the Government of the assumption that land values have permanently moved to the highest level of costs and prices. By that assumption the Government has acknowledged that its promise to put value back in the £1 is completely impossible of achievement. If that is so, I shudder to think of the plight of persons on fixed incomes and pensioners and, above all, of young home seekers.

The year 1950-51 was an abnormal year. It was a year of unprecedented high prices for wool which, in turn, had an effect upon the value of rural land. It was a year in which the greatest inflationary pressures were exerted in Australia and in which the basic wage rose by 7s., Ss., 13s. and 14s. in succeeding quarters. It was a year in which a great deal of free money was circulating throughout the country. Above all, it was the first year in which all controls on the sale of land were lifted. It is not strange that, in those circumstances, there was an abnormal rush by buyers to purchase land. Many tenants of properties which they held under lease were suddenly confronted by a landlord who saw an opportunity to sell his property freely on a high price market. In order to protect their goodwill in businesses that they had developed in leased premises the tenants were forced to buy land in fierce competition with other buyers. Of course, they paid an extravagant and a completely artificial price in those circumstances. Special circumstances of all kinds operated in that year to force prices up. I think the argument, is completely sound that high prices were paid, less for the land than for premises in which businesses could be conducted. The payment was in fact made for the buildings. I think that all honorable senators are aware of the great difficulty which every businessman and every business firm in Australia to-day experiences when trying to obtain accommodation. Circumstances such as those can lead to an untrue result in regard te valuations. I should like the AttorneyGeneral to inform the Senate of the exact basis upon which valuations are made by the Land Tax Valuation Branch. My opinion, which may not be accurate, is that a sale in the vicinity is taken as the standard, and that when the adjoining property, which has not been the subject of sale, is reached, a total value of a comparable nature is put on. The cost of the buildings to the owner, less reasonable depreciation in the intervening period, is deducted from that value, so determined. The value of a building is deducted from the total price, and the balance is declared to be the unimproved value of the land.

Senator Gorton:

– What about fences?

Senator McKENNA:

– I understand that a similar position obtains in relation to fencing on rural land. If one were to add the true value of the buildings - and by that I mean the replacement cost as at to-day’s date - to the value of unimproved land determined by the Commissioner, a completely unreal result would he obtained. It would be one far above the valuations that have been adopted by the Commissioner. I hope that I have made that point clear for the AttorneyGeneral and those who may advise him. I invite the honorable gentleman to make a clear statement for the benefit of all who are interested in land ownership, so that they may acquire knowledge of the basis of valuation that is adopted by the Commissioner.

I now wish to refer to several difficulties associated with land tax. The new valuations are notified to land-owners, for the first time, on their assessments of tax. They have then 30 days within which to appeal, but they are obliged, within 30 days, to make payment of land tax, irrespective of whether they appeal or not.

Senator Spicer:

– Time to pay might be granted.

Senator McKENNA:

– -The Commissioner may concede time to pay, but the law is that the land-owner must pay. Many people throughout Australia are completely shocked by the valuations that they receive under the new basis of valuation that has been determined by this Government.

Senator Spicer:

– It is not a new basis of valuation.

Senator McKENNA:

– In effect it is. Since 1941-42 the basis has been 1939 values. If modern values are adopted instanter, an entirely new basis is adopted. In other words, one is valuing on supposedly up-to-date values instead of on the pegged values of 1939, which is a new basis of valuation in this year.

I consider that it would be far better, particularly in the circumstances in which this tax is imposed, if notice of the new valuations were sent out well in advance of the assessment of tax. In that event, a land-owner could appeal and possibly have differences between himself and the Com missioner resolved before his liability to pay arose. The absence of any kind of federal valuation roll creates grave difficulties for any one who wishes to prepare a notice of objection. In fact, it is almost impossible for a person who wishes to object to a valuation to prepare an objection on a sound basis unless he has before him the valuations of the Commissioner and the Valuation Branch in respect of adjoining properties or properties in the vicinity. The unfortunate taxpayer who receives this bombshell of a greatly increased valuation of the unimproved value of his land, together with a vastly increased tax liability, is in difficulties in every way. He must pay the tax and he must prepare an objection. He must do so within a limited time, hut he completely lacks sound knowledge of the basis of valuation which has been adopted by the Commissioner. He also lacks knowledge concerning valuations of properties in the vicinity of his land.

I have already said that, for many reasons, it is incumbent upon land-owners to appeal. If they do not appeal against the new valuations, they invite assessments from municipalities and from State land tax departments on the basis of the valuations made by the Australian Government. I consider that the Commissioner may expect a flood of appeals from the payers of land tax in Australia. I very much fear that the valuation boards which will be concerned with such appeals will be cluttered up, and that great delays will ensue. I should like to know what the Government or the Commissioner contemplates by way of provision of an adequate number of boards to deal with what I expect will be a flood of appeals.

This increased land tax comes at a time when rents are pegged generally throughout Australia. It is not easy for a land-owner, whether in the country or in the city, to pass on such increased tax. I invite the Government to consider complaints that have been made regarding the incidence of the tax itself. For instance, last February, the president of the Real Estate Institute of New South Wales stated that many assessments were five times the amount of tax that was paid last year. He added that instances were not uncommon, where the tax is now greater than the actual net rent of the property. I think that all Tasmanian members of this Parliament were approached by representatives of the Hobart Chamber of Commerce concerning the incidence of this tax and were told of many instances in which the valuation of properties had increased from two and a half to three and three-quarter times, or up to 375 per cent. One instance concerned a widow whose tax had increased by 1962 per cent.

Senator Wright:

– Those cases no doubt arise because of the obsolete capital valuation rolls in Tasmania.

Senator McKENNA:

– They do not occur only in Tasmania. From inquiries that I have made, this position is common throughout Australia.

Senator Wright:

– -Instances of that kind do not really form a valid basis of objection.

Senator McKENNA:

– No. They are exceptional. However, the Treasurer (Sir Arthur Fadden), in a letter addressed to me, has acknowledged that there would be many instances where the increased tax would be greatly in excess of the 75 per cent, average which he originally claimed. I merely draw attention to the fact that any one who focuses his mind on the’ thought that there has been a 75 per cent, increase, will omit consideration of a great many cases in which the tax has risen out of all proportion.

I wish to read an extract from a letter that was sent to me this week by a gentleman in Sydney, dealing with the subject of land tax. I understand that his is not an uncommon case to-day in the light of the additional £4,000,000 land tax which was collected by this Government last year. The letter states -

Owing to my quarterly cheque not arriving from the trustees, I had occasion to ascertain the reason by ‘phoning them. I was informed that, amongst other things, money was held to provide for the new land tax. I then brought up the matter as to what extent I would be affected and was informed that my income from the property in which I am interested - a deceased estate - would be absorbed in the tax.

Here is a beneficiary in a deceased estate who counts upon receiving a regular cheque but who receives no cheque at all because of the incidence of this tax.

Senator Wright:

– I suppose that that is due to rent control?

Senator McKENNA:

– Not necessarily, although rent control would undoubtedly play a part. I have already adverted to that point. The fact remains that that instance is not an isolated one. Cases similar to that were put to members of this Parliament by representatives of the Hobart Chamber of Commerce, indicating that in some instances there was an actual loss after tax at the new rate had been taken into account.

I wish to make the point that the great proportion of land tax is raised, not from country properties, but from properties in the cities. I think that it is safe to say that at least 75 per cent, of the tax comes from city properties. This new impost hits very hard at a great number of land-holders at a time when rents are pegged and it is not easy to pass on additional costs.

Senator Wright:

– Are not they the people about whom the honorable member for Melbourne (Mr. Calwell) spoke when he complained in the House of Representatives that they were being given an undue benefit?

Senator McKENNA:

– I have no knowledge of what may have been said on this matter in another place by the honorable gentleman referred to. I repeat that this increased tax hits at primary producers.

Senator Spicer:

– Does the honorable senator consider that the exemption should be increased?

Senator McKENNA:

– I will give the honorable senator the benefit of my thought on that matter in a moment. I suggest that the net result of the imposition of the tax, even allowing for this rebate, will be to drive enthusiasm from the hearts of primary producers and to deter them from increasing food production. The bigger land-owners, who have already been mulcted to the tune of £47,000,000 this year by the abolition of the averaging system in respect of incomes of more than £4,000 per annum, will be hardest hit.

Senator Guy:

– They are on the same basis as anybody else.

Senator McKENNA:

– Those people have provided £47,000,000 this year. No doubt the big land-owners would contribute most by way of income tax if they worked their properties. They are the people who can afford to mechanize their properties. They could undertake production on a large scale. Yet they have been subjected to two blows dealt simultaneously. I refer to land tax and the additional £47,000,000 which they have been obliged to pay this year because of variation of the averaging system. Those two blows are really being struck at food production at a time when that subject is of critical importance to Australia. 1 come back to the very minor benefit which is conceded by this bill. The Government asks to be regarded as a benefactor because it exempts the taxpayers from liability to pay £687,000, although it seeks to increase land tax by £4,000,000. On that deal alone the Government will make a clear profit of more than £3,250,000. When I consider that, and even if I allow for the further £1,000,000 concession that is to be given- - again only to a restricted class of land. owners - under another bill, I agree entirely with the representatives of the Hobart Chamber of Commerce, who have described the concession in this legislation as a wholly futile gesture. They, of course, are primarily concerned, not with country areas, but with city properties, including some in the city of Hobart. If we subtract from the £4,000,000 that this tax, imposed only a few months ago, was estimated to yield, the concession of £680,000 contemplated in this measure, and the concession of £1,020,000 provided for in another measure, there will be left to the Government a net profit of £2,300,000. Having regard to the disturbance that has been caused, and allowing for costs of administering this new basis of valuation, and all the time that will be taken up in disposing of appeals, I frankly doubt whether it was worth the Treasurer’s while to forsake the 1939 values as the basis of valuation for land tax purposes. The position of the Labour party in relation to this concession is completely clear. One of the virtues of the Labour party is that, on any matter, its attitude is clearly defined and completely consistent. Decades ago, the Australian Labour party advocated the imposition of a tax on land of an unimproved capital value exceeding £5,000.

Senator Cormack:

– For what purpose ?

Senator McKENNA:

– For general purposes, and I think that the basic thought was that such a tax would assist to break up large rural estates. That hope, I venture to say, has not been realized to any appreciable degree. It is a hope which, in fact, does not need to be fulfilled in my view, because governments of every political colour are to-day entering the field of direct compulsory acquisition, a-t least for soldier settlement purposes. This Government sponsors and encourages such action. Every State Government takes the same view, and I submit that it is an infinitely better approach to the problem. The Labou party, quite frankly, does not care how big land-holdings are so long a$ they are being worked in the interests of the community, nor does it want to disturb areas, no matter how large, that are being worked to give reasonable production. We are concerned, however, with the breaking up of estates that are not worked to full advantage or are allowed to lie idle, and the owners of which are not prepared to allow them to be worked by other persons who are willing to undertake the task.

Senator Cormack:

– Would the honorable senator acquire small properties as well as large holdings for that reason?

Senator McKENNA:

– That would be quite proper. If land is lying idle and there is a need for greater productivity from it, and if acquisition will enable the establishment of ex-servicemen in primary production, unquestionably it should be acquired. The attitude of the Labour party to the land tax is this: An exemption of £5,000 was established, I believe, in 1910. The figure has not been altered since that date, and therefore that policy binds everybody in the Australian Labour party. Nobody in the Labour party believed that any government would have allowed inflation to go unchecked for two years. Nobody expected that this Government would, at a time of such grave difficulty as this for everybody in business, step up valuations from the 1939 levels to figures ruling at that completely abnormal point of time, the 30th June, 1951.

Senator Spicer:

– We merely applied Labour’s legislation..

Senator McKENNA:

– The Defence (Transitional Provisions) Act provided year by year for the maintenance of values at the 1939 level.

Senator Spicer:

– That could not be continued after 1949.

Senator McKENNA:

– The Government has continued it. Provision “was ultimately made in the act itself, and it no longer depended on the ephemeral defence power for its authority. It can be done under the most complete power of taxation. I invite the Attorney-General to say something about the basis of valuation that has been adopted by the courts. I invite him also to have regard to the difficulty that will be created by the lodging of many appeals. Bound as we are by our platform, we, on this side of the chamber, oppose the bill.

Senator HENTY:
Tasmania

.- 1 support this bill because I believe that it provides for a welcome reduction of taxes. I supported the 1951-52 budget, which estimated the yield from the land tax at £7,250,000 for the remaining portion of the year. Consequently, when it became obvious that, because of the new basis of valuation, receipts would exceed that sum, I felt that the Government should act rapidly to provide relief for the taxpayers. Some of us may believe that the relief is not as great as it should have been, but at least it is some relief. I shall deal with one or two points that have been raised by the Leader of the Opposition (Senator McKenna), who mixed party politics with some very interesting facts. He said, for instance, that the 1939 values should have been retained for land tax purposes. I am sure that every honorable senator knows that valuations for land tax purposes were carried out triennially until the pegging of land values by the national security regulations in 1939. Land values continued to be pegged until the national security regulations were challenged in the High Court and held to be invalid. The provisions of the Land Tax Assess ment Act became operative immediately and revaluation of lands was necessary. This bill raises the exemption from £5,000 to £S,750. The .new figure is .based on an overall increase of assessments by 75 per cent. That is the estimate by the Taxation Branch of the Commonwealth wide increase, and my .experience is that departmental officials who have had long experience in these matters, can be relied upon to give an accurate figure. However, I shall await the end of the financial year with great interest. In 1950-51, Commonwealth-wide receipts from the land tax amounted to £3,591,139, of which Tasmania contributed £33,019, or one part in 108, which is less than 1 per cent. On the new valuations, the yield in Tasmania is estimated at £134,000, or four times the 1950-51 figure. By multiplying that by 108, we arrive at an estimated Commonwealth-wide total of £14,000,000. That calculation, of course, is based on the assumption that land throughout the Commonwealth has been revalued, but I have a feeling that Tasmania is being used as a guinea-pig State. I believe that Tasmanian lands have been revalued because of the. smallness of that State, and that lands in the other States have not yet been dealt with. I think it is also a fair assumption that the roll of land taxpayers in Tasmania, has not been revised for some time because the position appears to be somewhat chaotic. I shall give to the Senate some examples of increased land tax assessments. On one Launceston property, the increase was from £66 to £666. Other increases that have come to my notice have been from £66 to £616, from £207 to £1,576 and from £51 to £506. I could give many other examples. I completely agree with the Loader of the Opposition that no notification of increased valuation was sent to land-owners, and that the first intimation they received of the revaluation was their tax assessment. I should like to hear something from the Attorney-General (Senator Spicer) on that point. The receipt of unexpectedly large land tax assessments has imposed hardships on many taxpayers. I am sure that there will be a high percentage of appeals against assessments, and I should like to know what prospect there is of such appeals being heard within a reasonable time. In the meantime, of course, the taxpayers will have to meet their assessments. There should be a federal land tax roll in order that values may be compared.

When land tax legislation was previously before Parliament I voiced sentiments which I believe to be pertinent to this bill. I can see no reason why the Australian Government should levy landtax at all. I can see no good reason why a State government should levy land tax. The bodies which should levy land tax are the local authorities. They are closely in touch with the owners of the land and they service the areas in respect of which land tax is assessed. At the moment, these authorities are feeling the pinch because they derive revenue only from rates. I can perceive of no value in the imposition of a Federal or State land tax and I think that the Australian and State governments should withdraw from this field of taxation and allow local governing bodies to levy a land tax appropriate to their needs. At present there are three separate valuing authorities - the Commonwealth, the State, and the local government bodies, and in many Gases each of these authorities places a different valuation on the same block of land. Honorable senators now have an opportunity to streamline the system of valuation and eliminate two of these valuing authorities. Surely one valuation is all that is necessary. Surely it is not necessary to have three different bodies with their own offices and staff to carry out valuations of the same properties. I hope that action of the nature that I have suggested will be taken in the near future.

The fourth and final report of the Royal Commission on Taxation which was made in 1934 supported the proposal that local governments are the best bodies to undertake the collection of land tax. Ofl page 213 of its report the commission traversed a great deal of interesting ground. In paragraph 1280 of the report it discussed the merits and demerits of land tax. In paragraph 1281 it stated -

Whatever may he the merits or demerits ot these respective contentions, they are greatly accentuated when the tax is imposed, as under the Commonwealth Act, at a progressive rate with a high exemption. Where the unimproved value of a person’s holding does not exceed the amount of the exemption it is free from tax. Where the unimproved value of his holding exceeds the exemption the excess only is taxed, and the rate of tax increases with every pound of increase in value. It follows that if a merchant desires to extend his business by taking in an adjoining site, he incurs an additional tax, not only on the new site, but on his original holding. The same result follows if he acquires land to establish a branch business in another city, or if he buys <> cattle station in another State. In the case of each holding, the amount of tax depends on the value, not of that holding, but of the aggregate amount of land owned by him.

The commission stated in paragraphs 1282 and 1283 of its report that a graduated tax was not as effective as a small tax on improved values levied by municipal authorities would he. I consider, that the conclusions of the commission could well have been studied closely &.nd steps taken accordingly in order to simplify the method of taxation affected by this bill.

The Leader of the Opposition stated that the land tax was introduced in order to enforce the subdivision of large estates. That purpose has now been outmoded by State legislation under which the State governments have powers of acquisition which are far more effective in enforcing the subdivision of large estates than the federal land tax. I submit that the land tax has failed miserably in that objective. The honorable senator continued by saying that the bill before the House would favour the hig land-holder. The opposite is the truth.

Senator Armstrong:

– I did not hear him say that.

Senator HENTY:

– The honorable senator could not have been listening to him.

Senator Armstrong:

– I listened closely.

Senator HENTY:

– He stated that the bill favoured the big man. Land tax is an allowable deduction for income tax purposes and the greater part of the benefit that the big land-holder will receive from the proposed reduction of land tax will go to the Treasury in the form of income tax. The Leader of the Opposition knew that to be so. The greater benefit will go to the small man, who, because of his low income tax liability, will retain most of the reduction in his land tax. In addition, at least 22,000 small land-holders will be completely relieved of the necessity to pay land tax. This will be a great benefit to many of the smaller producers in country areas. During many debates that have been held in this chamber the Opposition has accused the Government of- stopping primary production. Yet, now that the Government has taken a first step to relieve the smaller land-holders of taxation the Opposition has opposed its proposals. Yet Opposition senators have the hide to say that they are always consistent. It is only a few hours since Opposition senators were urging the Government to reduce taxation. Now that the Government has introduced a bill to reduce taxation they oppose it. How can they claim to be consistent? They are consistent in their thoughtlessness. They have to be. They have to do what they are told.

The bill before the House represents a first step in the direction of a reduction of taxation and it will provide an incentive to increase production. I certainly do- not agree with the Opposition’s contention that the Government should increase the land tax in. order to enforce the subdivision of land. You can lead a horse to water but you can’t make it drink. Increasing the land tax will not result in greater production. The Government is to be commended on the rapidity with which it dealt with this matter. I feel sure that we can look forward to more tax reductions. Together with legislation to provide for the operation of a 20 per cent, surcharge which will come before the Senate at a later date, this bill will result in a reduction of taxation of over £1,500,000 to the land-owners of Australia. I support the bill.

Senator ARMSTRONG:
New South Wales

.- This bill will not provide for any reduction of taxation for the people who pay federal land tax. The land tax was introduced with the object of forcing large land-holders to subdivide their estates. It was introduced a long time ago, in 1910, when a man who owned £5.000 worth of land had a substantial holding. In those days the tax succeeded, in no small measure, in causing certain properties to be sold.

However, the tax is not now effective in causing land to be subdivided. It is now only another means of obtaining revenue. It is just another tax which has been imposed on top of all the other taxes that are borne by the people. It could safely be abolished. As Senator Henty pointed out, State governments already have power under their own legislation to break up large estates. I do not know the actual figures, but I believe that from 75 per cent, to 80 per cent, of the revenue derived from federal land tax is collected from the owners of city properties. I know of one company in Sydney that pays probably 4 per cent, of the total amount collected in federal land tax. When one person or firm owns several properties, the value of all those properties is aggregated, and the rate of tax is struck on the total value. A company like David Jones Limited, which owns several very valuable properties in the centre of Sydney, must pay a very substantial amount in federal land tax. The incidence of the federal land tax, at a time when the level of general taxation is very high, has done a great deal to destroy public confidence. We have been told that the Government expects to raise about £9,000,000 from this tax. Senator Henty, basing his opinion upon the experience of property-owners in Tasmania, said that the amount collected this year would be nearer £14,000,000. He cited two instances in Hobart in one of which a taxpayer’s assessment had increased from £66 to £666, whilst in the other the assessment had increased from £51 to £506. Those are very drastic increases.

Senator Wright:

– Why is the honorable senator opposing the proposed reduction?

Senator ARMSTRONG:

– There is to be no reduction, and the honorable senator knows it. Last year, the federal land tax produced £3,500,000. This year, the estimated return is £9,000,000. The Government proposes to remit between £600,000 and £700,000, and says it is reducing the tax. Let Senator Wright discuss this matter with the Hobart property owner whose assessment has been increased from £66 to £666. He would have a very interested auditor upon whom to practise his eloquence. I believe that federal land tax could well be abolished, and 1 suggest that the Government should seriously consider abolishing it. Then, if the Government needs more revenue, the money should be raised by income tax. Last week, I collected some figures relating to increased land tax assessments, and they support the estimate of Senator Henty that this year the tax is more likely to yield £14,000,000 than £9,000,000. The assessment of one manufacturer increased from £1,650 in 1950 to £5,420 in 1951, that of another manufacturer from £560 to £2,140, and that of a third from £32 in 1950 to £181 in 1951. The tax paid by a golf club in 1950 was £50, but in 1951 it was called upon to pay £2,000. A property-owner, who paid £600 in land tax in 1950, was required to pay £1,841 in 1951, whilst still another propertyowner who paid £820 in 1950 paid £1,765 in 1951. Those increases, coming on top of the colossal burdens imposed upon industry in the September budget have proved to be the last straw, and industry is beginning to totter under the load.

Senator GORTON:

– The honorable senator knows that federal land tax is an allowable deduction for income tax purposes.

Senator ARMSTRONG:

– That is not the point. The fact remains that £14,000,000 is to be taken by the Government at a time when industry can ill afford to pay it. Our chief concern at the moment should .be to keep business moving, and the factories in production. We know that there is a great danger of serious unemployment. Figures published last week show that already untrained workers are walking the streets in a vain search for employment. Such vacancies as exist are for skilled tradesmen only.

Senator Scott:

– What about rural workers ?

Senator ARMSTRONG:

– The rural industries apparently have all the labour they require. When 30,000 so-called vacancies were surveyed only two months ago, it was found there were only 300 applications for rural workers. It is evident, therefore, that the farmers have all the labour they want or can afford to pay for.

For the reasons stated we oppose the bill. When a Labour government imposed the federal land tax in 1910 it did so for a specific reason, but that reason no longer exists. I believe that the Australian Labour party might well review its policy on this issue. I hope that when the Government brings down its next proposals for a reduction of taxation, they will he bona fide, instead of being “ phoney “ as this one is.

Senator LAUGHT:
South Australia

– Senator Armstrong made the interesting suggestion that the Australian Labour party might have another look at its policy in respect of federal land tax. This Government has had another look at the tax, and the present bill is the result. Senator Armstrong, running true to form, opposed the Government’s proposal to grant certain concessions to those who pay federal land tax. The Leader of the Opposition (Senator McKenna) also opposed it because his party instructed him to do so. He claimed that the platform of his party required him to oppose it.

Let us see just what has happened in respect of federal land tax. In the first place, it is necessary to point out that the Government did not increase the rate of tax last year. The rate has remained stationary for the last 40 years. It begins at Id. in the £1 on an unimproved value of £5,000, and increases by l/18,750d. for every £1 over £5,000. That was the rate before the last budget was introduced, and the budget did not change it. It is well recognized that land values have risen, and property owners have been paying more tax because the value of their land has increased, not because the rate of tax has been increased. Now, in order to give relief to property owners, the Government proposes to raise the statutory exemption from £5,000 to £8,750. Thus, a man who owns land the unimproved value of which is less than £S,750 will not pay any land tax. A man can now own nearly 600 acres of agricultural land worth £15 an acre unimproved, and not be liable for any federal land tax at all. He can now own 2,000 acres of poorer country, the unimproved value of which is £2 15s. an acre, without paying tax. A city land-owner can own a block with a 40-ft. frontage worth £200 a foot without being liable to pay tax. It is evident, therefore, that the raising of the statutory exemption has conferred a practical benefit on property owners. At present the owner of land of an unimproved capital value of £10,000 is liable to pay federal land tax of £26. If this measure becomes law he will be liable to pay only £5 10s. It is therefore obvious that the bill is not a meaningless gesture to the small land holders, who are really the salt of the earth in this country. I am amazed at Labour’s opposition to the measure. I commend the Government for having introduced it, and I hope in -common with some Labour speakers, that the Government will effect further reductions of land tax as time goes on. A Royal Commission on Taxation was held in 1934, and the Report of the Royal Commissioner makes some interesting observations with regard to land tax. That royal commission was appointed for other than political reasons. Paragraph 1280 of the report reads: -

It is not necessary to refer to the evidence to realize that the propriety of a tax of this kind is the subject of strongly held and widely conflicting opinions. On the one hand it is denounced as a capital levy, discriminating arbitrarily and unjustly against those whose capital happens to be invested in one special class of property, as a discouragement of operations of pastoral and other industries on the scale best adapted for carrying them on economically and profitably, as a double tax in cases where profits are made which are subject to income tax, and as a tax imposed in disregard of the principle of “ ability to pay :’ in cases where the land is heavily’ mortgaged, or is the site of a business which is conducted at a loss. On the other hand it is advanced as a special merit of the tax that by imposing obstacles in the way of the aggregation of large areas in single hands it encourages the growth of a population of yeomen owners in country districts, and of small individually owned businesses in the cities, and that it constitutes some return to the community as a whole from those who enjoy the unearned increment resulting from the growth of the community and its communal activities.

Senator Armstrong has stated that in his opinion federal land tax is an ineffective weapon to break up large estates. The Royal Commissioner pointed out that federal land tax is imposed in disregard of the principle of the ability to pay. The proposed reduction will be of greater value to the smaller businessmen and land-holders because, as has been already pointed out, federal land tax paid is an allowable deduction for income tax purposes. Therefore members of the community who benefit by a reduction of federal land tax will be required to pay a little more income tax. Those whose income tax payments are small will not get a really great benefit from the reduction of federal land tax. I remind honorable senators that 22,000 erstwhile payers of federal land tax will escape this obligation by virtue of the proposed amendment.

I am confident that the bill will be passed by the Senate, and in due course regulations will issue to implement its provisions. I therefore take this opportunity to bring to the notice of the Government the complicated nature of the land tax forms that land-holders are required to complete. In the past, these forms have had to be filled in by the holders of land of an unimproved capital value of £4,000 or more, although the holders of land of an unimproved capital value of less than £5,000 were not liable to pay federal land tax. I submit that land-holders should not be required to fill in land tax forms unless they hold land exceeding an unimproved capital value of £7,500.

Senator Wright:

– Why not £8,750?

Senator LAUGHT:

– In common with Senator Wright, I should like the figure to be £8,750, but I suggest that it should be not less than £7,500. I remind honorable senators that the land tax form contains, about fifty questions in respect of each parcel of land held, and contains four pages. Further forms must be filled in with relation to each acquisition or disposal of land. I consider that taxpayers should be relieved as much as possible of the necessity to fill in these forms.

I invite the attention of the Senate to the procedure in relation to land tax that has been adopted in South Australia. Particulars of the unimproved capital value of land are recorded in large books, which are available for inspection by the public during office hours. I should like to see that system adopted in every capital city where there is a land tax office. I urge the Government to eliminate from the form questions relative to the interest of taxpayers in limited liability companies. The system of taxation in relation to land-holders’ shareholdings in public companies which own land, is very complicated. The official attitude appears to be that such shareholders should pay an additional proportion of land tax. This part of our taxation laws has been in existence for almost half a century, and should be simplified. I have very much pleasure in supporting the measure which, i. trust, will be the forerunner of other bills to implement the Government’s promise to grant further tax concessions. In another place the Government is taking steps to reduce income tax. This measure provides us with an opportunity to ease the federal land tax burden.

Senator PEARSON:
South Australia.

– Some very interesting speeches have been delivered during this debate by honorable senators on both sides of the chamber. I could not but feel very sorry for the Leader of the Opposition (Senator McKenna). Honorable senators have witnessed the spectacle of the leader of a great political party in this chamber showing a burning zeal to support the measure, because he realized that it would confer a benefit on many people, but stating at the conclusion of his speech that he opposed the hill, because he was bound by his party’s platform. It was evident that the Leader of the Opposition was prevented from giving effect to his true thoughts on the matter. On many occasions during my long association with two parliaments in this country I have seen spokesmen for the Labour party in difficulties, but I felt extremely sorry for the Leader of the Opposition when he was forced to admit that he could not support the measure despite his better judgment Be it known to the farmers of this country that that is the position in which Labour finds itself in relation to this measure, not on my say so, but on the say -so of the Leader of the Opposition in this chamber.

Senator Armstrong, who is a man of great stature in the Labour ‘party a this chamber, was gamer than his leader and stated that land taxation, which was introduced by Labour some years ago, should be abolished. I sincerely trust that the honorable senator does noi get into trouble with his party for making that statement. I imagine that he is bound by the party platform in the same way that the Leader of the Opposition is bound. It would appear that honorable senators opposite should hold a party meeting in order to determine their attitude to the bill. Senator Armstrong stated that he did not consider that there was any taxation concession inherent in the bill. As a modest landholder, I hope to derive a benefit from th.» concessions provided by the measure. From time to time I have been called a fool, but I realize that I am on a winner this time. It should be perfectly obvious to every honorable senator that the bill confers a benefit on land-holders. Senator Armstrong should consider th,relative position of a person who is at present liable to pay land tax, and his position after the amendment, contained in the bill before the chamber becomes law. The question is : Does this bill alter the position? If it alters the position, I submit that it confers a benefit on certain landholders. I welcome the bill, which indicates the readiness of the Government to meet changing circumstances. Previously, land values were pegged; now, they are no longer pegged, and values are based on present day conditions. The principal act, with which every honorable senator doubtless is familiar, prescribes that assessments must be reviewed at triennial periods. An obligation rests upon the Government to carry out the provisions of the act, and the Government must therefore base land values on current values, as distinct from the values prevailing in previous years, when certain circumstances demanded that they be pegged down. Those circumstances no longer obtain. The Government has met the effect of changing circumstances by proposing to raise the statutory exemption from £5,000 to £8,750. It has approached this matter in a realistic way. The Attorney-General (Senator Spicer) has said that his advisers have estimated that the overall average increase . values is approximately 75 per cent. If *we admit the accuracy of that estimate, we must make provision for an appropriate increase of the statutory exemption. That has been done by the Government in this legislation.

I join with Senator Henty in expressing some diffidence about accepting the advice which has been given to the Government on that matter. I cannot but believe, from cases that have been presented to me, that increases in assessments have been considerably in excess of 75 per cent. Like the honorable senator, I have had many cases brought to my notice showing that the increases in the assessments have ranged from 200 per cent, to 300 per cent. I cannot accept without question the advice of the departmental officers that the average increase in assessments has been only 75 per cent. It will be interesting to ascertain at the end of the year whether these predictions have been correctly made.

The Government deserves commendation for having introduced this bill in accordance with the advice given to it. I have no doubt that, if the advice is subsequently proved incorrect, appropriate adjustments will be made. The measure will confer a benefit on approximately 22,000 persons, who otherwise would be liable for the payment of land tax. Does Senator Armstrong contend’ that those persons will receive no benefit from this legislation? I imagine that those who, but for the provisions of this legislation, would be liable for the payment of land tax, regard this legislation as conferring a benefit on them. Senator Armstrong, who is a reputable person, must admit the truth of my assertions. The bill will not only confer a benefit on the 22,000 persons to whom I have referred, but also assist those who are liable for the payment of land tax.

Although I most heartily support the bill, I am in agreement with some of my colleagues and with Senator Armstrong, who was courageous enough to make his position clear. They have expressed the opinion that the Commonwealth may well vacate the field of land tax. Seasons have been advanced by my colleagues for the discontinuance of this tax. When the principal act was intro duced in 1910, its supporters stated that its purpose was to break up large estates. Lf the legislation has not achieved that purpose in the intervening years, it is unlikely that it will do so in years to come. Some honorable senators have contended that this field should be left exclusively to local governing bodies. I am not sure that it would be appropriate for us to vacate the field for that purpose, or whether we should leave it exclusively ‘ to State governments. I have an open mind on that aspect of the problem, but I am firmly convinced that the Commonwealth should not remain in the field, not only because the legislation has failed to achieve its purpose but also because of the relatively small amount of revenue collected by way of land tax.

The Attorney-General has told us that the estimated increase of revenue from land tax is £4,000,000 for this financial year. That is purely an estimate, but it by no means represents the complete picture. Amounts paid in land tax are claimed as deductions by taxpayers from their taxable incomes. A stab estimate of deductions claimed in that way indicates that the net return to the Commonwealth will not be more than 10s. in every £1 that is collected. On the basis of that rough estimate, the expected gain to the Treasury this year will amount, not to £4,000,000 as the Attorney-General has indicated, bat to approximately £2,000,000. Surely it is not worthwhile for the Commonwealth to continue the imposition of land tax merely for revenue-producing purposes. The assessment and collection of land tax necessitates the employment of a vast army of officials. Administrative costs must be deducted from the revenue yield in order to arrive at an estimate of the true worth of this form of tax. I suggest that the net gain to the Treasury is very small indeed. It is neither necessary nor wise for three assessing bodies to undertake what, in effect, is the same job. Therefore, I have no compunction in suggesting that the Commonwealth should vacate this field of taxation.

The definition of improved and unimproved values in the Commonwealth act is almost identical with that in the South Australian act, but, in practice, the results of the application of the definition by the two governments are different. Obviously, there oan be one only true unimproved value of any parcel of land. However, we find that although the definitions are similar in the Commonwealth and the State legislation, the assessments issued by the Commonwealth are completely at variance with assessments made by the South Australian land tax authorities. That fact has completely mystified land-holders. I am constantly asked by them to explain how the assessments are arrived at, and upon what principles they are based. I have the greatest difficulty in answering their questions satisfactorily. I have never seen a Commonwealth valuer in the locality in which I reside, although I have owned property in the same place for a considerable number of years. I do not know how the valuers for land tax purposes make their assessments. I cannot help thinking that many of the assessments are merely stabs in the dark by officers who have not particular knowledge of the land with which they are concerned. A farm may be sold in a section of a certain Hundred in South Australia for £35 an acreApparently, the Commonwealth officers estimate the value of the adjoining blocks at the same figure. That is merely rough-and-ready reckoning, which is unscientific and does not satisfy the taxpayer, or honorable senators. If that is the way in which assessments are computed, there is very good reason why the Commonwealth should vacate this field of taxation without delay. As I have said, the amount of revenue collected from this source is negligible by comparison with the total amount of revenue collected by the Commonwealth. I trust that the Government will examine the possibility of withdrawing from this field of taxation.

Debate interrupted.

page 932

ADJOURNMENT

Snowy Mountains Scheme - Canberra - Mrs. Ian Anderson

THE PRESIDENT.- Order! In conformity with the Sessional Order relating to the adjournment of the Senate, I formally put the question -

That the Senate do now adjourn.

Senator VINCENT:
“Western Australia

– I crave the indulgence of the Senate to make reference to a visit which some of my colleagues and I recently made to the Snowy Mountains hydro-electric scheme. I wish to pay a tribute to the commissioner, Mr. Hudson, and to the members of his staff for the splendid organization of the scheme generally. I do not propose to describe the scheme in detail. As a layman, I am not competent to outline the vastness and the import of this project which, in time, will double the power potential of Australia and make available sufficient water to irrigate land which will produce food equal in value to the total wheat crop that is now grown in Western Australia. I suggest that all honorable senators should accept the kind invitation of the commissioner to visit the area.

One of the most striking features of the project is the enormous amount of work that has been let to private contractors. Many of them have come from overseas and have brought with them materials and labour forces. I saw Dutchmen erecting houses and small towns. I also saw Germans erecting houses. Norwegians were building tunnels and getting on with the serious work of constructing the vast dams that are about to be commenced. The conviction was forced upon me that all this great work is possible only through the efforts of private enterprise. I accordingly pay tribute to this Government because of its policy in relation to the construction of the project.

Senator Aylett:

– It is not a bad socialist project, is it?

Senator VINCENT:

– I also pay a tribute to the Government which envisaged and commenced the scheme. I certainly do not intend to cast reflections on the persons responsible for the conception of this great project. At the same time, my first thought on going there was that the scheme could not be completed without the assistance of private enterprise. In fact, private enterprise is carrying out the work.

The financial aspect was another striking factor that presented itself to me. At the present time, the scheme is being financed from yearly revenue. I consider that that has a great weakness about it. The authority which is undertaking this scheme is living from budget to budget, as it were. The commissioner frankly admits that he has no idea of the amount of money which the Government may allow him from revenue in the next budgetary year. Obviously in a long-term project, effective planning cannot be undertaken on such a financial basis. I appreciate the dilemna of the authority in that regard. I also appreciate that the Government, for the time being, is obliged to finance the project from revenue, but I hope that as soon as possible the finance necessary for the undertaking will be made available from loan funds on a regular basis, so that proper planning can proceed in an orderly manner.

I compliment the commissioner and his staff of experts on the manner in which the work is being carried out. It is obvious that the project is running smoothly, efficiently and effectively. It is also obvious that some fine brains are behind it. In conclusion, I wish to place on record my sincere appreciation of the extreme courtesy and hospitality which were extended to us by the commissioner and the various members of his staff, including his first assistant, Mr. Merigan. Their efforts made our visit both pleasant and memorable.

Senator O’FLAHERTY:
South Australia

– I wish to raise a matter of grave injustice which concerns all members of this Parliament who live in hotels or hostels controlled by the Minister for the Interior. I refer particularly to the Hotel Kurrajong. It appears that some one in authority has conceived the idea that the little extra payment which members of Parliament now receive as a result of the Nicholas report should be dragged away from them and returned to the government coffers as quickly as possible. Some one with a mathematical mind has apparently calculated that there should be an increase of the charge for board and lodging. Nobody would quarrel with such an increase if it were based merely on the increased cost of living. I point out, however, that the tariff at Hotel Kurrajong, which is £7 9s. a week, is not evenly divisible by seven.

If divided by seven, the result is £1 ls. 3d. and three-sevenths of a penny. The authority will not permit a charge to be made for a single meal or for a bed at night. It has decided that if a person stays at the hotel for broken periods a casual rate of £1 13s. a day will apply. That casual rate makes no provision for individual meals or for the use of a bed.

The person with the mathematical mind has had another brainwave and has decided that a minimum charge be made for bed and breakfast. The minimum charge has been fixed at £1 5s. If the Minister for the Interior is responsible for this state of affairs he should be thoroughly ashamed of himself. If responsibility rests with an employee of the Department of the Interior who has a dislike of members of Parliament, it is time that he was taken to task. The management says, “ “We open our books on Wednesday, and if you come in on a Tuesday you must pay the casual rate. If you stay an additional couple of days after Wednesday even though you have been there continuously for weeks you must pay the casual rate for the remainded of the period “. Recently I arrived at Canberra on Sunday evening and had a meal at the Hotel Kurrajong on Sunday night. This week I received an account amounting to £12 16s. in respect of my wife and myself, made up to last Wednesday for three days and one meal. I defy any one to

Tela te that sum to the scales of charges that are said to operate.

If a guest stays a day or so beyond the Wednesday, although he may have been in residence for anything up to six months previously, the dictator who decides such matters has ordained that the casual rate shall be charged for those additional days. I suggest that the period between the time of taking up residence and the time of leaving should be calculated week by “week. As it is, if one is not there on Wednesday, the casual rate operates until the following Wednesday. If the Minister representing the Minister for the Interior does not give consideration to this matter, there will be a revolt. Honorable members will refuse to pay the exorbitant rates that are being charged by the Hotel Kurrajong. There is seething discontent among persons who are in a position similar to mine, but they are prepared to give the Minister an opportunity to right this grievious wrong, this robbery that is being practised on members of the Parliament.

Senator GRANT:
New South Wales

.- Now that Senator O’Flaherty has delivered his remarks concerning an Irish mathematician, I wish to say something about a matter which concerns Scotland. I am not interested in the financial aspect of Senator O’Flaherty’s remarks. Last Thursday I asked a question in the Senate concerning a lady who had recently arrived in this country from Scotland. Since asking that question, I have been the victim of a somewhat unjustified attack by Senator Wedgwood. I do not think that I said anything disparaging about the visitor. My question was as follows: -

I should like the Minister for Trade and Customs to give the Senate any information he possesses about an organization known as the Imperial Relations Trust. The press yesterday reported a series of extraordinary statements by Mrs. Ian Anderson, who is paying a four months’ visit to Australia under the sponsorship of the trust and who, during her stay here, is to be the guest of the Country Women’s Association. Seemingly, this lady has come from Scotland with the object of giving us information regarding that country. Is the trust financed by the Government? Is any control exercised over the persons selected by the trust to come here? If so, what precautions are taken to ensure that they shall he qualified to speak on behalf of the countries that they claim to represent? Mrs. Anderson is reported to have made the startling statement that nearly everybody in the highlands of Scotland wears the kilt. That is sheer rubbish. Steps should be taken to ensure that those who come here on such visits shall be better informed.

Or the motion for the adjournment of the Senate on the same day, Senator Wedgwood said -

I desire to register an emphatic protest against the deliberate insult that was offered by Senator Grant during question time this morning to a most distinguished woman visitor to Australia.

The PRESIDENT:

– Order! If the honorable senator is quoting- from the Hansard “ flat “ he is entirely out of order.

Senator GRANT:

– If that is so, Mr. President, my position becomes rather difficult. Senator Wedgwood’ implied that I had, in some way, disparaged Mrs.

Anderson, and that I had spoken slightingly of the Country Women’s Association. I say that Mrs. Anderson offended the Country Women’s Association by assuming’ that its members were all so stupid that they would believe something that was absolutely untrue, namely, that nearly everybody in the highlands of SCOt land wore a kilt. I believe that member! of the association are far too intelligent to believe that. Apparently Mrs. Anderson was selected to come to this country to inform us about Scotland, and to be informed about Australia. If the Imperial Relations Trust did not pay her fare, I should like to know who did pay it. If the trust did pay her fare, did it take any precautions to ensure that Mrs. Anderson was sufficiently well informed for her task? Senator Wedgwood said that my remarks were “sinister”. There was nothing sinister about what 1 said. Scottish people in this country are laughing at Mrs. Anderson’s ridiculous statement. If she were an intelligent woman she would know that no highlander would talk about wearing “ kilts “ any more than an intelligent Australian would talk about “ sheeps “. The singular of both words is the same as the plural’. I had no reason to attack Mrs. Anderson. My only purpose in raising the matter was to ensure that in future any one who was to be sent out here to tell us about Scotland, or any other country, should be better informed. Not only was Mrs Anderson’s statement untrue, but also it was as far from the truth as it could possibly have been. One might just as well, say that Brisbane is full of aborigines. I asked my question to ascertain the qualifications possessed by this lady for her task, and I submit that Senator Wedgwood’s attack on me was completely unjustified.. I know of the work that the Country Women’s Association is doing. Senator Wedgwood referred to- the organization as the .” C.W.A.” Those initials are not used very much in New South Wales. If somebody mentioned’ “R.G.M.” or “L.G.”, I would know that the reference was to R. G. Menzies or Lloyd George, but, as I have said, we in New South Wales are not in the habit of using initials very much. However, the suggestion that because I did not identify the organization instantly from the initials, I had never heard of the Country Women’s Association, is ridiculous, i know all about it. It is a nonpolitical body which has branches in most country towns, and its members do a very good job. I hope that members of the association will put Mrs. Anderson on the carpet and say to her, “ We, . know that what you said was not true. You have gravely undermined the work that you might have been able to do. We are grateful to Senator Grant for drawing our attention to the fact that you have r.aken us for a lot of nitwits “.

Senator COLE:
Tasmania

.- I was a member of the party of parliamentarians, which as Senator Vincent has said visited the Snowy Mountains last week-end. In fact, Opposition members were in a majority in that party and I should like to state our views on the matter. I join with Senator Vincent in extending the thanks of the party to those who made our visit possible and organized our itinerary. We Tasmanians know quite a lot about ‘works of this kind because many such projects have been undertaken in that State. A tremendous amount of work has already been done on the Snowy Mountains scheme, but most of it obviously is preparatory work. Senator Vincent lauded the work of private enterprise. I remind him that, in Tasmania, projects considerably bigger than any of those now being undertaken by contractors in the Snowy Mountains, have been carried out without the aid of private enterprise. I do not believe that there is any need for private enterprise on such work, although perhaps it may provide a quick and easy means of doing some jobs. Senator Vincent said that’ private enterprise would make a success of the Snowy Mountains scheme. In Tasmania we have made a success of hydro-electric: works without tha assistance of private enterprise.

Senator Maher:

– Is the work carried out by day labour in that Starts?’

Senator COLE:

– Tes it is done mostly by day labour. I should be pleased to have an opportunity to show Senator. Maher somer of the . big Tasmanian hydroelectric schemes. Incidentally; I should like to pay a tribute to’ Senator Mather’s unofficial leadership of our party:.

The honorable senator proved to be a most enjoyable companion. I hope that we were able to convince him that by maintaining the socialist Snowy Mountains Hydro-electric Authority the Government is taking at least one step in the right direction. I think that Senator Vincent was only trying to salve his own conscience so far as the work of socialist enterprises is concerned. Expenditure by the Snowy Mountains Hydro-electric Authority during the last twelve months was about £10,300,000. I hope that whatever funds are sought to enable this work to continue in the ensuing year, will be granted in full by the Commonwealth. Whatever paring has to be done in other directions, there should be no reduction of the expenditure on the Snowy Mountains scheme. If say £16,000,000, is sought, that figure should not be reduced. The Treasury might be inclined to take the view that by reducing that estimate by say £2,000,000, a small contribution could be made to the Government’s plan to reduce expenditure. The point is, however, that such a reduction might seriously curtail developmental work in view of the fact that a substantia] proportion of the remaining vote- would be required to meet commitments that have already been undertaken.

The PRESIDENT:

– Order! I think that the honorable senator is anticipating the debate on the supply bills which will come before this chamber to-morrow. I. suggest that’ the remarks that he is now making could more appropriately be made when those measures are under discussion.

Senator COLE:

– In that case I shall refer to this matter again at a later stage. Before concluding, however, I should like to thank Mr. Hudson, the Snowy Mountains Hydro-electric Commissioner, and Mr. Merrigan, the Assistant Commissioner, .who travelled with the parliamentary party and who did everything possible to ensure the success of the visit. I should like to- thank also the officers of the authority who met Us at various points and made our trip so enjoyable. We are grateful, too, to the Minister’ for National Development (Senator Spooner) for having ‘made our visit possible:

Question resolved in the affirmative.

page 936

PAPERS

The following papers were p re sented : -

Conciliation and Arbitration Act - RegulationsStatutory Rules 1952, No. 39.

Defence (Transitional Provisions) Act - Regulations - Statutory Rules 1952, No. 37.

Lands Acquisition Act - Land acquired for - Defence purposes- Bullsbrook, Western Australia.

Department of Civil Aviation purposes - Narrogin, Western Australia.

Postal purposes -

Carrawigara, South Australia.

Hamilton, Victoria.

Lowan Vale, South Australia.

Snowy Mountains Hydro-electric Authority purposes - Cooma, New South Wales.

Post and Telegraph Act - Regulations - Statutory Rules 1952, Nos. 35, 38.

Public Service Act - Appointments - Department -

Defence Production - A, G. Jones, R. Pendlebury, R. J. Taylor, F. L. Wiegard,R. E. Willian.

Health- P. L. Bazeley.

NationalDevelopment - M. A. Reynolds.

Supply - G. E. Barlow, D. Barnsley, B. S. Deegan, J. M. R. Frost, B. T. Gilroy, H. J. Biggs, R. G. Keats, M. S. Kirkpatrick, G. Lee, R. A. Leslie, P. V. Morgan, R. J. Rockliff, A. Sharpe, K. D. Thomson, P. M. Twiss, R. H. Whitten, A. R. W. Wilson.

Public Service Arbitration Act- Determinations by the Arbitrator, &c. 1952 -

No. 11 - Hospital Employee’s Federation of Australasia.

No. 12- Australian Third Division Telegraphists’ and Postal Clerks’ Union.

No. 13 - Commonwealth Public Service Artisans’ Association.

No. 14 - Australian Third Division Tela graphists and Postal Clerks’ Union.

No. 15 - Commonwealth Storemen and Packers’ Union of Australia.

No. 16 - Commonwealth Telegraph Traffic and Supervisory Officers’ Association.

No. 17 - Australian Workers’ Union.

No. 18 - Australian Workers’ Union; and Boilermakers’ Society of Australia.

No. 19 - Amalgamated Engineering Union and Others.

No. 20 - Australian Federated Union of Locomotive Enginemen.

No. 21 - Non-Official Postmaster’s Association of Australia.

No. 22 - Repatriation Department Medical Officers’ Association.

No. 23 - Supervising Technicians’ Association, Postmaster-General’s Department.

No. 24 - Commonwealth Public Service Clerical Association.

No. 25 - Commonwealth Storemen and Packers’ Union of Australia; and Federated Ironworkers’ Association of Australia.

Nos. 26 and 27 - Australian Workers’ Union.

No. 28- Customs Officers’ Association of Australia (Fourth Division) ; and Printing Industry Employees’ Union of Australia.

No. 29 - Australian Federated Union of Locomotive Enginemen.

No. 30 - Australian Broadcasting Commission Staff Association.

No. 31 - Printing Industry Employees’ Union of Australia.

No. 32 - Commonwealth Public Service Artisans’ Association.

No. 33 - Australian Broadcasting Commission Senior Officers’ Association.

No. 34 - Actors and Announcers’ Equity Association of Australia.

No. 35 - Musicians’ Union of Australia.

No. 36 - Electrical Trades Union of Australia.

Wool Products Bounty Act - Regulations - Statutory Rules 1952, No. 36.

Senate adjourned at 11.28 p.m.

Cite as: Australia, Senate, Debates, 28 May 1952, viewed 22 October 2017, <http://historichansard.net/senate/1952/19520528_senate_20_217/>.

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