Senate
4 December 1957

22nd Parliament · 2nd Session

  1. Senate
  2. 22nd Parliament
  3. 1957

Wednesday, 4 December 1957. l bc PRESIDENT (Senator the Hon. Sir

Alister McMullin) took the chair at 3 p.m., and read prayers.

page 1685

QUESTION

REPATRIATION PENSIONS

Senator SANDFORD:
VICTORIA

– ls the Minister for Repatriation aware that the Repatriation Department reviews all variable pensions after each increase provided by a Budget? Does the Minister know that in almost all instances pensions reviewed in those circumstances are reduced? My questions are prompted by representations made to me recently by persons whose pensions have been reduced since the pension increases provided by the last Budget. In one case referred to me, a pension was reduced from 70 per cent, to 60 per cent., although the pensioner now must take more time off from work as a result of his disability than ever before. If this is in accordance with Government practice, it amounts to giving an increase with one hand and taking it away with the other.

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

– I can assure the honorable senator that it is not the general practice of the Repatriation Department to review all pensions after every Budget. To suggest that that is the practice is quite wrong.

Senator Sandford:

– It happens.

Senator COOPER:

– A review is made, naturally, but not of all pensions. Most repatriation pensions and other benefits are on a stabilized basis. A review is made only of pensions granted for some ailment or disability that is not likely to be permanent. In a case of that kind, a review is made within one year, three years, or even five years. If the review shows that the pensionable disability is not so great as previously, the pension may be reduced. If the member’s condition becomes worse, he may apply for a re-adjustment of his pension, and he may be assessed as being 80 per cent, or 100 per cent, disabled, instead of, say, 60 per cent. I assure the honorable senator that no general review of repatriation pensions is made after a Budget. It would be ridiculous to call in for review about 230,000 pensions. A review is made only in cases where there is a chance that the member’* condition will become better or worse. If his condition has become worse, his pension is increased.

page 1685

DISTINGUISHED VISITOR

The PRESIDENT:

– I have to advise the Senate that His Excellency Mr. Nobusuke Kishi, the Prime Minister of Japan, is within the precincts of the Senate. With the concurrence of honorable senators, I propose to invite His Excellency to take a seat on the floor of the Senate.

Honorable Senators. - Hear, hear! (Mr. Kishi thereupon entered the chamber, and was seated accordingly.)

page 1685

QUESTION

HOUSING

Senator BENN:
QUEENSLAND

– Has the Minister for National Development had an opportunity to examine the plan for constructing 75,000 houses a year in addition to those for which financial provision has been made, as outlined by Sir Douglas Copland when he addressed a meeting of 38 building trades organizations in Melbourne on the 29th November? Could the Minister say how the seven governments in Australia would have to change their present fiscal policies to provide surplus revenue approximating ?125,000,000 annually to implement the plan?

Senator SPOONER:
Minister for National Development · NEW SOUTH WALES · LP

– I did see the newspaper report of the speech that Sir Douglas Copland made. My understanding of the suggestion is a little different from that of the honorable senator. I did not think that Sir Douglas advocated the construction of 75,000 houses over and above those now being erected by the governments of Australia. I thought his proposal was aimed at a target of round about that figure. I remember being rather intrigued at the suggestion because 75,000 houses was the rate of commencements shown by the last set of figures from the Commonwealth Statistician, and although there is no guarantee that that rate of commencements will be continued, it seems to me that the target suggested by Sir Douglas was already being aimed at.

I could not follow his proposal for a fresh financial deal, as it were. He made a suggestion that the governments should unite, and I think he suggested building additional houses out of surplus taxation. I think he used some such phrase as that, and I could not understand it. Perhaps it was because I did not agree with his suggestion that I did not understand it.

Reference has been made to Australia’s housing problem. It is not additional money from the governments that is wanted. The Commonwealth Government, for instance, is already finding £77,000,000 out of a total of approximately £230,000,000. What we need is more money from the banks, insurance companies and private investors, that money to be made available preferably through building societies. I suggest that the government contribution is as big as that at which we should aim for an efficient home building programme.

page 1686

QUESTION

WAR-CAUSED NEUROSIS

Senator TANGNEY:
WESTERN AUSTRALIA

– I address the following questions to the Minister for Repatriation: - (1.) Does the Repatriation Department consider that psycho-analysis is in any circumstances an appropriate form of treatment for war-caused neurosis? (2.) Bearing in mind the cost of psycho-analysis, has the Repatriation Department ever recommended this form of treatment in the case of an accepted disability? (3.) When an ex-soldier with an accepted disability from war-caused neurosis independently, and at his own expense, undertakes a course of psycho-analysis with a member of the recognized psycho-analyst’s institute, does the department, if requested by the ex-soldier, signify its concurrence in circumstances where it considers that psychoanalysis is appropriate, although, of course, disclaiming its financial responsibility? (4.) Does an ex-soldier disqualify himself from the right to receive treatment from the Repatriation Department if he independently undertakes treatment at the hands of a private practitioner?

Senator COOPER:
CP

– The honorable senator’s question is so wide that it is difficult to answer offhand. I cannot say specifically what would be done in the case the honorable senator has mentioned without having an opportunity to study more complete details. If an ex-serviceman needed special treatment, he would get it, according to the recommendation of the departmental doctors. It would be immaterial what the treatment was or how much it cost. It would be given, provided the patient was suffering from a disability caused by war service. I do not believe that the- department would meet the expense of treatment obtained by the patient himself privately from a doctor or specialist. The Repatriation Department has at its disposal the services of the best specialists who are available. I do not believe that a debt for medical expenses that was incurred by an ex-serviceman on his own account would be met by the department.

Senator Tangney:

– Would the exserviceman disqualify himself from further treatment by the department?

Senator COOPER:

– I would say not, but the individual case would have to be examined. I believe that the patient would not jeopardize his rights to further treatment by a departmental doctor unless the treatment that he received privately worsened his condition.

page 1686

QUESTION

WHEAT

Senator PEARSON:
SOUTH AUSTRALIA

– I preface a question to the Minister representing the Minister for Primary Industry by stating that, some time ago, the Minister for Primary Industry announced that, in view of the fact that there would probably be sufficient wheat available after the coming harvest in Australia to meet Australia’s local requirements, the Government had decided against importing wheat from Canada or elsewhere. Since then, the Australian Wheat Board has expressed the opinion that, in order to protect Australia’s traditional markets for wheat and flour, we would be wise to import some wheat ta enable us to maintain, to some extent, our volume of exports of wheat and flour. Wilt the Minister inform the Senate whether the view that has been expressed by the board will be taken into consideration by the Government?

Senator PALTRIDGE:
Minister for Shipping and Transport · WESTERN AUSTRALIA · LP

– On behalf of the Minister for Primary Industry, I can assure the honorable senator that the opinions of the Australian Wheat Boardwill always be considered by him in connexion with matters such as that which has been raised by the honorable senator. However, in view of the nature of the honorable senator’s question, I ask him to put it on notice so that I can obtain a detailed reply.

page 1687

QUESTION

IMPORT LICENSING

Senator O’FLAHERTY:
SOUTH AUSTRALIA

– Will the Minister representing the Minister for Trade state when I can expect a reply to a question that I directed to the Minister on import licences for Bank A5 goods? I brought forward this matter on behalf of the Dutch Electro Manufacturing Company about a month ago.

Senator SPOONER:
LP

– I can only say that I will do my best to obtain a reply for the honorable senator.

page 1687

QUESTION

SCHOOLS FOR RETARDED CHILDREN

Senator HANNAN:
VICTORIA

– I direct a question to the Leader of the Government in the Senate in his capacity as Minister representing the Prime Minister. Is he aware that institutions and schools that are conducted by various churches and charitable organizations and which are devoted to the care and instruction of retarded children are experiencing severe financial difficulties in regard to both the erection of capital buildings and their operating maintenance? In View of the magnificent community work that is being rendered to the nation by these schools and institutions, will the Government consider some form of financial assistance along the lines of the Aged Persons Homes Act in respect of capital, and some form of per capita subsidy in respect of maintenance?

Senator O’SULLIVAN:
Attorney-General · QUEENSLAND · LP

– The Government is well aware and deeply appreciative of the splendid work that is being done by these institutions, but it is very doubtful whether that work really comes within the province of the Commonwealth. However, I shall put the honorable senator’s proposition to the Prime Minister and see whether anything can be done to assist these organizations in their excellent work.

page 1687

QUESTION

AUSTRALIAN DEMOCRATIC LABOUR PARTY

Senator MARRIOTT:
TASMANIA · LP

– Has the Leader of the Government in this place seen a statement in the press, purporting to come from the Leader of the Democratic Labour party in the Senate, in which the honorable -senator explained his reason for his party’s action in ensuring that the Government’s banking bills were not debated? Is it not a fact that, if the Democratic Labour party had acted in a democratic manner and in accordance with parliamentary procedures, and had permitted a second-reading debate on the bills, it may have, by moving amendments to the legislation, at least partly attained its now expressed objective in regard to Australia’s banking policy?

Senator O’SULLIVAN:
LP

– I assure the Senate that this is not a “ Dorothy Dixer “. I am compelled to agree in part with the suggestion of my colleague, Senator Marriott, that if the Democratic Labour party had acted democratically, the Senate would have had the opportunity to have a second-reading debate on the bills. As to the reasons why that opportunity was not afforded to the Senate, I refer Senator Marriott to Senator Cole.

page 1687

QUESTION

VISIT TO AUSTRALIA BY MR. NEHRU

Senator COURTICE:
QUEENSLAND

– My question is directed to the Minister representing the Prime Minister. In view of the great influence of the Prime Minister of India in the Asian world, and in order to cement further the traditionally friendly relations between Australia and India, will the Government consider extending an invitation to Mr. Nehru to visit Australia?

Senator O’SULLIVAN:
LP

– I am quite sure the Senate will agree with me when I say that that no one is more interested than is the Prime Minister of Australia in the creation, development, and maintenance of goodwill among peoples throughout the world, but particularly those who live in our part of it. I am quite sure, too, that no opportunity to establish that goodwill will escape the attention of the right honorable gentleman.

page 1687

QUESTION

BRITISH MOTOR VEHICLES

Senator WRIGHT:
TASMANIA

– On 17th October, I asked the Minister representing the Minister for Trade the following question: -

  1. Has the Minister seen the most pleasing statement in the current United Kingdom information service bulletin, viz., “The total of over 37,000 motor cars exported from the United Kingdom in August represents the peak ‘figure for any August “, under the heading “ Britain Again World’s Largest Exporter of Motor Vehicles “7
  2. Will the Minister inform the Senate of the trend of the proportion of these United Kingdom exports which, say in the last half year, have come into Australia?
Senator SPOONER:
LP

– My colleague, the Minister for Trade, has supplied the following answer: -

  1. Yes.
  2. The Minister for Trade has advised that the number of motor cars exported from the United Kingdom in total and to Australia during the period January to August, 1957, was as follows: -

page 1688

QUESTION

EXPORT OF WOOL TO FRANCE

Senator PEARSON:

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

  1. Is it a fact, as reported in the South Australian “Advertiser” of 31st October, that French purchases of Australian wool will probably be curtailed during the current year because of the difficulty France is experiencing in connexion with foreign exchange?
  2. Has the Minister any confirmation of the report that France has now extended the 20 per cent, tax on imports, announced some little time ago, so as to cover raw materials, including wool, which originally were expected from the tax?
Senator SPOONER:
LP

– The Minister for Trade has advised me as follows: -

  1. The French nation is currently in a most difficult balance of payments position, not only in respect of their trade with this country, but with the world as a whole. It seems that this may have led to reduced competition from France at the wool auctions. This has tended to be offset in the market by the strength of Japanese buying, which can be attributed in large part to the favorable trading atmosphere engendered by the recent trade agreement between Japan and ourselves. As for France, the balance of payments position is particularly intractible. While I was in Paris at the invitation of the French Government about a year ago, I discussed this matter fully. However, any special arrangement that might have improved their payments position bilaterally with Australia, would have involved us in discrimination against other countries with which we trade. Such discrimination would be contrary to our policy and to our international obligation.
  2. On 28th October, France extended the 20 per cent, surcharge to all transactions in foreign currencies, except for the import of cereals into French overseas departments and territories other than Algeria. Wool was previously exempted bat is now subject to the 20 per cent, tax on importation into France. At the same time the former variable subsidy payable on wool textiles exports, was replaced by a larger export subsidy at a fixed rate of 20 per cent.

page 1688

QUESTION

ATOMIC ENERGY

Senator SCOTT:
through Senator Dame Annabelle Rankin

asked the Minister for National Development, upon notice -

  1. Has the Minister seen an article in the Melbourne “ Herald “, of 31st October, wherein Professor Oliphant is reported to have stated that the Harwell scientists had taken another step towards harnessing the H-bomb, and that with the development of this power for peace it may not be long before power is unlimited and cheap?
  2. Can the Minister advise whether, in a decade or two, it will be possible, with the development of hydrogen as a power, to transform the interior of the continent from desert to prosperous agriculture?
  3. Could this cheap thermo-nuclear power be used successfully to make aluminium on the spot from bauxite deposits on York Peninsula?
  4. Could this important discovery of using water for power mean that the population potential of Australia is unlimited?
Senator SPOONER:
LP

– In view of the importance of this matter, I have obtained a considered statement upon it from the Australian Atomic Energy Commission. The statement is as follows: -

The statement in the Melbourne “ Herald “ to which the honorable senator refers is one of several which have been made recently indicating progress towards the goal of harnessing the fusion process as a source of energy. Intensive research is going on at present in the United Kingdom, the United States and the Soviet Union, as well as in a number of other countries, in an endeavour to find conditions under which the fusion of heavy hydrogen, or deuterium, may be carried out under control. This process takes place at extremely high temperatures, far beyond anything achieved in ordinary industrial practice. The production of such temperatures presents great difficulties which have not yet been solved. Scientists are studying various methods by which the fusion process might be induced. These have involved the use of shock waves and extremely powerful electrical discharges through gases maintained in position by magnetic fields. So far as we know, no one has yet demonstrated, beyond question, that a fusion process can be brought about in these ways, though there are hopeful indications that progress is being made towards such an achievement. At the present time no one can say whether it will ultimately be possible to pro- duce industrial power economically from heavy hydrogen in this manner. If it is, it will be of great importance because of the large quantities of heavy hydrogen which are available in the world, and the enormous amount of power which it should be possible to obtain therefrom. However, it does not follow, even if a technical solution of this problem is found, that the power from this source will be cheap. The cost of producing power by any process is made up of the cost of fuel, the cost of labour, and the capital charges on the power station equipment and buildings. In large modern power units the cost of labour is so small and constant that we may ignore it. In atomic power stations, using the fission process, of the type currently being built in Great Britain and America, owing to the low efficiency with which uranium fuel is used, the fuel cost is little better than that in a coal-fired station. In advanced types of fission reactors now being developed it is expected (hat the fuel cost will be extremely small and the cost of power largely determined by the capital charges on the station and its equipment. This situation will also apply to power stations using the fusion process, and although the cost of the fuel, heavy hydrogen, may be negligible, if the power station is expensive and elaborate, as may well be the case, the cost of power may be no cheaper than that from fission stations now being developed, and indeed, it may be higher.

It is unlikely that, within a decade or two, it will be possible to use fusion power to transform the interior of Australia from desert to agricultural land, owing to the enormous capital expenditure which such a project would involve - even assuming that the technical problems of fusion have been solved. Such a transformation might be possible in the more distant future, perhaps in the next century, if all other land having good rainfall is being fully exploited, further technical progress has been made, and if the market for agricultural products is far larger than it is to-day.

It seems not unlikely that power from fission, using uranium or thorium, may be available sufficiently cheaply in from ten to twenty years’ time for the production of aluminium in the Cape York Peninsula, assuming of course that this location were otherwise suitable for such a project, e.g., as regards water supplies. Atomic power at this moment is not cheap enough for this purpose.

I think that if the economic and technical problems of fusion power were in due course solved, the result might have a profound effect upon the ultimate development of Australia, and upon the population the country will be capable of supporting.

page 1689

QUESTION

INTERNATIONAL MARITIME CONFERENCE

Senator McMANUS:
VICTORIA

asked the Minister for Shipping and Transport, upon notice -

  1. Will Australia be represented at the meeting of the International Law Commission, set up under the authority of the United Nations, scheduled to be held in Rome in March, 1958?
  2. If so, will the Commonwealth Government direct the Australian representatives to support the draft resolution concerning Flags of Convenience adopted at the Preparatory Maritime Technical Conference in London in September 1956, which resolution is supported by International Sea Transport Trade Unions?
  3. Is it a fact that the resolution concerned is aimed against the practice of certain shipowners in registering their vessels in countries such as Panama, Liberia, Honduras and Costa Rica, so that they can evade the obligations insisted on in traditionally maritime countries of maintaining satisfactory standards of wages, accommodation and safety in the crews’ interests?
  4. Would it not be advisable for Australia, whose standards in these matters are high, to support the resolution?
Senator PALTRIDGE:
LP

– The following are the answers to the honorable senator’s questions -

  1. There may perhaps be some confusion regarding two conferences on maritime matters, each to be held in 1958. A United Nations conference on the law of the sea will be held at Geneva, commencing on 24th February, 1958, and will take as the basis for its consideration a report submitted by the International Law Commission to the General Assembly in 1956. Australia will be represented at the Geneva conference. The London conference to which the honorable senator refers was held under the auspices of the International Labour Office in preparation for a further conference to be convened by that organization at a place and date in 1958 to be arranged.
  2. The London conference adopted a resolution concerning Flag Transfer, the general purport of which was that countries in which ships are registered are urged to accept the full obligations implied by registration and to exercise effective control for the purposes of safety and welfare of seamen. The documents prepared for the further International Labour Office conference have only just been received in Australia. They are being examined by the appropriate authorities and it is not possible to say at this stage what instructions will be given to a Government delegation, if one is sent. It is the practice for shipowners’ and seamen’s delegates also to attend these conferences, and the Government could not instruct them.
  3. Whilst the resolution is aimed at the practice of transferring registration of ships to other countries, the London conference showed that it is now accepted that the principal reason for the transfers is not so much the desire to avoid the provision of good living standards for the crew as to escape from the burdens of high taxation and the observance of internationally accepted social and safety standards. However, many of the transferred ships are quite modern and have good living standards. All four countries mentioned in the question have adopted the International Load Line Convention, and two of them the Safety of Life at Sea Convention. They are all, however, backward in regard to the Conventions of the International Labour Office.
  4. See answer to question 2.

page 1690

QUESTION

LAND SETTLEMENT OF EX-SERVICEMEN

Senator AYLETT:
TASMANIA

asked the Minister representing the Minister for Primary Industry, upon notice -

  1. How long is it since work commenced on Montagu Swamp for the purpose of closer setlement for ex-servicemen?
  2. Is it a fact that over £620,000 has already been spent and that no one farm is ready for settlement?
  3. What is the estimated total cost of the Montagu Swamp Closer Settlement Scheme?
  4. What will be the acreage and cost of each individual block when completed and ready to be taken over by ex-servicemen?
Senator PALTRIDGE:
LP

– The following answers have been furnished: -

  1. It is approximately seven years since the initial work commenced at Montagu Swamp. Clearing commenced in 19S2.
  2. It is a fact that over £620,000 has been spent on work to date. Four potential settlers are in occupation of blocks, but these have not reached the level of productivity necessary for allotment.
  3. An estimate of cost was prepared in 19S0. Since that time costs have risen. At present, the area to be developed is under further consideration and when this has been defined fresh estimates will be prepared. Costs to date are well within the original approval.
  4. Blocks will vary in size according to the soils of the area. It is expected that the average area will be approximately 120 acres. Costs will not be known until the work is completed. The valuation for allotment to ex-servicemen will be on the basis of the block’s productivity in accordance with established practice. Costs in excess of this valuation will be written off.

page 1690

QUESTION

COPPER

Senator COLE:
TASMANIA

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

  1. Is it a fact that there has been a downward trend in copper prices during the last few months?
  2. Would the Minister support the representation made to the Tariff Board by the Mount Lyell company for help so that the company can still function successfully?
  3. Is it a fact that as from 30th November the standard of living at Queenstown will be drastically reduced because of bonus payments being suspended?
  4. To safeguard the future of Queenstown and other copper towns, will the Minister endeavour to arrange for copper production in Australia to receive encouragement from the Commonwealth similar to that given to gold production?
Senator SPOONER:
LP

– The Minister for Trade has supplied the following answers: -

  1. Yes.
  2. The representations made by the Mount Lyell company to the Tariff Board will be considered, together with those of other interested parties, in the light of the board’s comments and recommendations, when the board’s report comes to hand.
  3. I understand that, for the last two and onehalf years, a special bonus has been paid to the employees of the Mount Lyell company. This bonus is a payment over and above the normal industrial award conditions applicable to industry in Tasmania, and is an arrangement betweenthe company and the unions involved whereby employees of the company shared in the previous, high prices being obtained for copper.
  4. The question of assistance to copper-mining; in Australia will be considered in the light of the Tariff Board’s report, when received.

page 1690

QUESTION

LAND SETTLEMENT OF EX-SERVICEMEN

Senator AYLETT:

asked the Minister representing the Minister for Primary Industry, upon notice -

  1. What was the total amount advanced by the Commonwealth Government for the purchase and/or acquisition and preparation of closer settlement holdings for ex-servicemen during each ot the financial years ended 30th June 1950 to 1957,. inclusive?
  2. What was the total amount written off (i.e., representing the difference between the cost of purchase and preparation and the productive value as sold to the ex-servicemen) on the abovementioned holdings each year over the same period?
Senator PALTRIDGE:
LP

– The following information has been furnished in reply ta the honorable senator’s questions: - 1 and 2. The figures asked for by Senator Aylett are -

The figures in columns two and three bear nr> direct relationship to each other as the amount expended on acquisition and development of any individual property could be spread over several years, whereas the amount written off the cost would only appear in the year of the valuation of the holding that would take place either in the final year of development or in some subsequent year. Column two also includes capital expenditure on plant, stores, &c, still on hand that will be chargeable against future development and progress expenditure on large developmental projects not yet completed and valued.

page 1691

QUESTION

AUSTRALIAN APPLE AND PEAR BOARD

Senator PALTRIDGE:
LP

– On 13 th November, Senator Wright asked me a question without notice relating to the appointment of the chairman of the Australian Apple and Pear Board. The Minister acting for the Minister for Primary Industry has now advised me as follows: -

Action has now been taken to appoint Mr. C. E. Critchley, O.B.E., of Melbourne, as the government representative on the Australian Apple and Pear Board in succession to the late Mr. J. B. Mills. In accordance with the provisions of the legislation under which the board operates, Mr. Critchley will automatically be the chairman of the board.

Mr. Critchley has had extensive experience in government administration and in export marketing. He served in several overseas posts in the Trade Commissioner Service, and from 1946 to 19S3 was the Senior Australian Trade Commissioner in London. During the war period Mr. Critchley was Assistant Controller-General of Food.

page 1691

TRUST FUND

Report of Public Accounts Committee

Senator SEWARD:
WESTERN AUSTRALIA

– I present the following report of the Public Accounts Committee: -

Thirty-fourth Report - The Trust Fund, together with Minutes of Evidence.

The investigations of the Public Accounts Committee over the years have fallen into two broad categories. Mostly, they have been inquiries into the financial administration of government departments or agencies, but some have been made into the form in which the accounts of the Commonwealth are kept by the Treasurer. Honorable senators may recall that the committee’s eighth report dealt with parliamentary procedure in the House of Representatives on the supply and appropriation bills; the eighteenth report examined specific documents - the Budget Speech and Estimates of Receipts and Expenditure.

More recently, in our thirty-first report, the committee dealt with the presentation of the Supplementary Estimates and we proposed that a new procedure be adopted. A resolution, which puts into effect some of our recommendations, is before the House of Representatives at the present time. This thirty-fourth report of the committee falls within the second category and deals with the Trust Fund, one of the three major funds within the Commonwealth public account.

In this report we trace the growth of the Trust Fund from its very humble beginnings in 1901 to the present day when its balances total over £900,000,000 and the annual expenditure from the fund amounts to over £800,000,000. We discuss the various types of accounts that have been established, their purposes and their necessity. We doubt the necessity for certain kinds of trust accounts and endorse the use of others, but we point out the need for a review of all trust accounts, and this, we believe, is now being undertaken by the Department of the Treasury. We also propose that more information be made available to the Parliament about the operations of the Trust Fund.

We have also considered the use made of the Trust Fund and Trust Fund balances. We have concluded that, viewed as an instrument of financial control, the Trust Fund has its weaknesses but that on the whole it is a necessary and useful instrument. We have expressed our opinion that those who administer and those who operate heads of Trust Fund and trust accounts are doing so, taken all in all, in a proper manner.

In this inquiry, as with most others we have undertaken, it seems clear that the attention we have focussed on existing practices and the re-examination of procedures which our inquiry has prompted have already had results. Since November, 1956, when the first of the public hearings concerned with this inquiry was held, quite a number of changes have been made in the operation of the Trust Fund. Some accounts, to which the committee directed attention, have been closed and other procedural alterations have been made which accord with views which are expressed by the committee in this report.

But for other reasons we regard this report as one of the most valuable the committee has yet presented. In the course of our inquiry we found that there was a lack of written material about the Trust Fund, its purposes and its uses, that was readily accessible to the public. While this report does not cover every aspect of the Trust Fund in detail we consider that it will, to a very large extent, satisfy an urgent need for factual information about the Trust Fund and its operation.

The report should not only be useful to senators and public servants concerned with the management of Commonwealth finances but should be found of value in the universities and other places of learning both as an historical document and as a book of reference.

Ordered to be printed.

page 1692

BILLS RETURNED FROM THE HOUSE OF REPRESENTATIVES

The following bills were returned from the House of Representatives without amendment: -

Civil Aviation Agreement Bill 19S7.

Air Navigation (Charges) Bill 1957.

page 1692

GENEVA CONVENTIONS BILL 1957

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator O’sullivan) read a first time.

Second Reading

Senator O’SULLIVAN:
Vice-President of the Executive Council and Attorney-General · Queensland · LP

– I move -

That the bill be now read a second time.

The object of this bill is to make necessary provision to enable Australia to ratify four conventions drafted at an international conference, at which Australia was represented held in Geneva in 1949. The conventions were all signed on behalf of Australia but have not yet been ratified. It is the intention of the Government to take steps to ratify the conventions, steps which I am sure that every honorable senator will wholeheartedly approve, having regard to the humanitarian character of the conventions and their general purpose, which can be briefly described as comprising a code of rules for the protection of the unfortunate victims of war.

The texts of the four conventions are set out in the schedules to the bill. The first convention concerns the amelioration of the condition of the wounded and sick in armies in the field, is commonly known as the “ Red Cross Convention “ and is a revision of the earlier convention of 1929 to which Australia was a party. As the 1929 convention was itself a revision of an earlier convention of 1906 based upon experience during the first world war, so the 1949 convention is a revision of that of 1929 made in the light of experience during the second world war. This convention provides for respect, protection and care for all sick or wounded persons officially attached to armies, the protection of medical units, establishments and material, medical and voluntary aid personnel, chaplains, medical transport and aircraft, hospitals, hospital zones and localities and lays down rules concerning the use of the distinctive emblem of the Red Cross.

The second convention relates to the wounded, sick and ship-wrecked members of the armed forces at sea. This convention is a revision of the Tenth Hague Convention of 1907 which adapted the provisions of the Red Cross Convention to maritime warfare.

The third convention deals with the treatment of prisoners of war. It defines what prisoners of war are, lays down general principles concerning their protection and rules governing their treatment in captivity, discipline, transfer, employment, notification of captures and reports concerning state of health and various other matters affecting prisoners of war generally. The convention contains more detailed provisions than its earlier counterpart on such subjects as the employment of prisoners and their financial resources, and contains some innovations such as inclusion among prisoners of war of members of crews of merchant ships and civil aircraft.

The fourth convention, which deals with the protection of civilians in time of war, is new, and in some respects goes beyond what have hitherto been the normal obligations of international law. It provides, for example, that enemy aliens must be permitted to leave the country unless their departure would be contrary to theinterests of’ the State when the protecting power must be given reasons for the refusal. Enemy aliens who remain are, subject to national security requirements, to be treated as aliens in time of peace, must not be required to perform work directly related to the conduct of military operations, and can be interned only if security so necessitates or at their own request. Most of the provisions consist of regulations for the treatment of internees, who, generally speaking, are equated in relation to their internment to prisoners of war.

I have described in very general terms the objects of the conventions. Most of their provisions can be given effect under existing legislation or by way of administrative arrangement. But certain of the provisions of the conventions could not be given effect without legislative provision which it is the purpose of the present bill to make.It will be seen that, apart from parts 1 and 5 of the bill, which relate to the preliminary matters and empower the making of regulations, the bill deals with three main subjects, namely, the punishment of offenders against the conventions, legal proceedings in respect of protected persons and provisions designed to prevent abuse of the Red Cross and other distinctive emblems. I shall deal shortly with each of these matters.

Part 2 of the bill provides for punishment of persons who commit what are described in the conventions as “ grave breaches “. A “ grave breach “ is defined by reference to the articles of the respective conventions. lt will be seen that “ grave breaches “ are breaches involving such acts as wilful killing, torture or inhuman treatment, wilfully causing great suffering and extensive destruction and appropriation of property. In relation to prisoners of war, a “ grave breach “ covers such matters as compelling a prisoner to serve in the forces of a hostile power or wilfully depriving him of the rights of fair trial. In the case of civilians, unlawful deportation or confinement is also included. All four conventions require contracting parties to enact legislation to provide penal sanctions for such “ grave breaches “ and it thus becomes necessary for Australia to make such provision if we are to carry out our obligations under the conventions. I should perhaps add thatthe conventions also require contracting parties to search for offenders and bring them, regardless of their nationality, before their own courts or, if preferred, to hand them over for trial to another high contracting party.

Part 3 of the bill is designed to give effect to the requirements of the Prisoners of War Convention and the Civilian Convention concerning safeguards for a fair and proper trial of prisoners of war and internees for offences against the law or regulations in force in the detaining country. They cover such matters as proper notice to a protecting power as well as the accused, legal representation and provision to secure rights of appeal.

Part 4 of the bill is designed to give effect to the requirements of the conventions that contracting parties shall prohibit the use, except in accordance with the conventions, of the Red Cross or the Red Crescent and Red Lion and Sun which certain countries use for the same purpose. The arms of the Swiss Conferedation, i.e., the white cross on a red background, are also entitled to protection under the Wounded and Sick Convention. Section 15 is designed to meet with these requirements and will replace the similar prohibition which existed under the Geneva Conventions Act of 1938 which this bill will repeal.

The bill does not, of course, make legislative provision covering everything that is prescribed by the conventions. It makes only such provision as could not be made otherwise than by legislation. If this bill is passed into law - and I have no doubt all honorable senators will be in accord with its basic objectives - Australia will be in a position to join the other 60 countries which have ratified or acceded to all four conventions and thus not only advance the humanitarian principles behind the conventions but also be in a position to secure for its own people in the unfortunate event of war the protection which the conventions assure. I commend this bill to honorable senators.

Debate (on motion by Senator McKenna) adjourned.

page 1693

CUSTOMS TARIFF BILL (No. 3) 1957

Second Reading

Debate resumed from 13th November (vide page 1206), on motion by Senator Henry-

That the bill be now read a second time.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The measure that is before the Senate provides for the imposition of customs duties in some important particulars. With it, there is an excise bill which deals with identical duties and, with the concurrence of the Minister for Customs and Excise (Senator Henty) and the Senate, I shall direct my remarks to both bills as that would save time.

The PRESIDENT:

– There being no objection, that course may be followed.

Senator McKENNA:

– The bill is designed to impose duties on two items. One is upon diesel fuel for road purposes. The other is upon aviation kerosene.

In the latter case, the amount that is imposed is to be at the rate of 6±d. a gallon. In the other case, the duty will be at the rate of ls. a gallon. Combining the customs duty and the excise duty that are to be imposed by the two bills, we find that the revenue that is expected in a full year from aviation turbine kerosene will be approximately £400,000. In the case of automotive diesel fuel, the tax that is to be paid by road users will yield about * £2,000,000 in the remainder of this financial year, and £3,000,000 in a full year. The one complaint that the Opposition has to make regarding the measure is in relation to the new tax of 6£d. a gallon on aviation turbine kerosene.

In the debate on another matter before the Senate some time ago, I expressed opposition to this tax since the main burden of it will be imposed upon the Government instrumentality, Trans- Australia Airlines. lt would appear that most of the revenue that is !o be derived from this tax will be paid by T.A.A. Unquestionably, that will have the effect of either eliminating the airline’s present level of profit or necessitating higher charges. Whatever the effect, it is to be deplored.

It is desired that T.A.A. should function successfully from an accounting viewpoint, and it is desirable also, from the viewpoint of everybody in Australia, that the fares and freight charges of that important airline should not be increased. I submit to the Senate that such results would put a brake upon progress, for the tax is to be imposed on a fuel that has been developed for turbo-prop engines. The advantage that an. entrepreneur might gain from his enterprise in using a new fuel for a new type of aircraft will be offset immediately by a tax which he might not expect to be imposed when it contributes a burden and a brake upon enterprise.

Senator Wright:

– Why should he not expect the introduction of a tax like this to equate the cost of the fuel with the cost of petrol?

Senator McKENNA:

– I was about to put the argument that revenue that is to be derived for the purposes of meeting civil aviation costs should not be drawn from a tax of this sort at all. I point out to Senator Wright that aviation spirit is used still by T.A.A., and that that airline uses it also for many of its vehicles. If any entrepreneur in Australia, decides to use a fuel that is not subject to duty, he may hope to avoid the payment of a duty. That is one of his hopes when he embarks into a new field of aviation. He hopes to be tax free.

Senator Wright:

– In a socialist community he could escape it, and good luck to him!

Senator McKENNA:

– The operators escaped this tax for a little time but it has caught up with them. I know the avidity of the Treasurer to gather every possible duty into the net. Having regard to the form of the Treasurer in recent years, the operators might well have feared the worst while hoping for the best. Now the worst has happened, and the tax is to be imposed. I put it to the Senate that the tax will be a bar to persons embarking on the importation of the pure jets which will use far more fuel. This duty will present a temptation to operators not to use more highly developed aircraft when they can get no advantage in avoiding the payment of taxes from using the required fuel.

Although the rate of tax that is to be imposed on aviation kerosene is lower per gallon than the tax on aviation spirit, that provision has been made only because far more kerosene is required to develop the same power as is generated by a gallon of aviation spirit. Therefore, in effect, the 6id. per gallon on aviation kerosene and the 10id. on aviation spirit are equivalent charges having regard to the difference in the quantities that will be used.

I was interested to get the reaction of the Minister for Civil Aviation (Senator Paltridge) on this matter recently in reply to my submission that the Government proposes to adopt an entirely wrong basis in seeking to recoup the expenses of the Department of Civil Aviation in maintaining airways facilities by imposing a tax of this sort - customs and excise duty - upon the fuel that is consumed by the airlines. It is not necessarily a fair basis. I submit that it would be very much better if the tax were based on the freights carried by particular aircraft, regard being had to the facilities provided on particular routes - and, if necessary, to the passengers that are carried. I believe that that would be a far more equitable basis than is comprised by navigation charges upon aircraft and the imposition of customs and excise duties upon the fuel that is used by the airlines. lt is neither a simple, a logical nor a rational way to raise revenue from aircraft.

I point out to the Senate that the proposed charges fall far short of meeting costs that are incurred in Australia in maintaining facilities for airways. The Budget Papers show that the total cost this year for operating the Department of Civil Aviation will be £9,862,000. Of that amount, £5,076,000 will be spent on the maintenance and operation of civil aviation facilities. That figure does not include administrative charges. That is the cost of direct charges to provide for the maintenance and operation of civil aviation facilities in Australia.

What revenue is obtained to meet that expenditure? The Budget Papers show at page 17 that only £511,000 is to be collected by way of air navigation charges. That is a contribution of £511,000 to meet a total cost of £5,076,000. Revenue from aviation spirit last year totalled £1,586,000, including customs duty at the rate of lOd. and ls. Id. per gallon, and excise duty at 8id. per gallon. Therefore, the sole revenue that has been available to the Commonwealth from those engaged in aviation is a contribution of £2,097,000 towards a minimum outlay of £5,076,000. By the time overhead charges and administrative costs are added, the discrepancy may be very much greater.

Senator Kendall:

– What happens to the tax on tickets?

Senator McKENNA:

– That is a State tax imposed in Queensland, which is Senator Kendall’s home State. If the honorable senator will turn to page 17 of the Budget Papers, he will find there all the details of the revenue that is to be raised for the Department of Civil Aviation. Air navigation charges this year will yield £511,000. The dividend from Qantas Empire Airways Limited will yield £377,000. Payment in the nature of a dividend by the Australian National Airlines Commission, which controls T.A.A., will yield £218,500. Miscellaneous items total £265,500. The total revenue will be £1,372,000. In addition, there will be a sum of approximately £1,500,000 for customs and excise duty on aviation spirit. So the cost of operating airways facilities is not nearly met by the charges and receipts of the Commonwealth.

  1. suggest that it would be better if the costs were centred upon one head, that is, air navigation charges, and if each flight were charged according to facilities used, passengers carried, and that kind of thing. It would mean that the present air navigation charges would have to be raised many times, but I suggest that that would be the fair and simple way in which to do it. We could then forget about customs and excise duty and let the battle of the fuels go on between the various companies, leaving the way open for them to find better fuels and more attractive aircraft. However, I see a difficulty for the Government in adopting that suggestion, which the Minister for Shipping and Transport indicated he would consider when I submitted it during discussion on another bill some time ago. 1 dare say he has not had an opportunity to consider it in the meantime.
Senator Kendall:

– Would there not be other means of raising revenue, such as sales tax on the buses that are used and the petrol that is used in motor vehicles?

Senator McKENNA:

– Do you mean vehicles that are used in association with flying?

Senator Kendall:

– Yes. It would all add up.

Senator McKENNA:

– It is perfectly true that motor vehicles used to transport people to and from airports perform an ancillary service. I have no doubt that there would be items of sales tax in relation to the operation of those vehicles. I have not been able to find any separate statistics dealing with that matter; but in the broad, and on the basis of information that the Government has made available, it is quite obvious that the industry is not meeting the cost of operating its services. There is a very big discrepancy. I am not objecting to that, because 1 recognize that the airways service is a necessary development service. 1 repeat that I am not objecting to the fact that there is a discrepancy, because in a young country like ours we must keep our facilities ahead of our needs. I need only to advert to the important defence aspect of having airway facilities available from one end of Australia to the other to illustrate that point. Even though those facilities are not regularly used, they must be maintained and preserved. The air signals system must be kept alive and be available at a moment’s notice. Again I say that I am not objecting to that.

When I suggest that all the costs may be centred upon air navigation charges, I remind the Senate that in 1952 the Government rather tied its hands by the agreement it made with A.N.A. when, in the first place, it cut in half the air navigation charges that were imposed by the previous government in 1949 and undertook not to increase those charges except in very limited circumstances that are detailed in the agreement. The provision of new routes was one of the exceptions, and increased costs that were strictly relative to charges constituted another. I note that the Government has agreed to tie its hands in that matter for fifteen years as from 1952. It is a provision to which objection was taken by the Opposition at the time and which has been objected to from time to time since. It seems that, when the Minister considers my suggestion as he has promised, he will run into the difficulty that is posed by that agreement.

We of the Opposition feel that it is wrong to impose a duty upon the progressive step which brought the turbo-prop aeroplane into this country, and we propose to move, at the committee stage, for the deletion of customs duty and excise duty on aviation kerosene. We think it is proper to support the imposition of a diesel fuel tax upon road users. I. doubt whether there would be any dissent in this chamber from the proposition that those people who use diesel machines on the roads of Australia should pay some contrbiution towards their upkeep.

Senator Wright:

– Why should they not expect to be immune from tax just as are those people who use kerosene for aviation purposes?

Senator McKENNA:

– I put it to the honorable senator that there is a very great difference. The road users are doing vast damage to roads and the other facilities that they use, but we cannot say that airway facilities are subjected to anything like that degree of wear and tear.

Senator Wright:

– But the machines that use petrol and those that use aviation kerosene do the same amount of damage to aerodromes.

Senator McKENNA:

– I submit that they are in an entirely different category of degree. In the aviation field, petrol-consuming aircraft are equally as heavy as the turbo-prop aircraft, they are shod similarly and are relatively of the same weight, the same landing stresses exist, and the same wear and tear is caused to the airway facilities. We think it is proper that both kinds of aircraft should be treated similarly.

We think it is proper, too, that, having regard to the exemptions that the Government has seen fit to grant in favour of those who are not road users, there ought to be a clear definition of the principles upon which they are to be exempt. I understand that legislation for that purpose has been introduced in another place and that presently it will come to us. I do not know the contents of that legislation, but I merely comment that it would have been of advantage to have had that other measure before the Senate at this stage.

I indicate that the Opposition does not propose to vote against the motion for the second reading of this bill but that it will express its viewpoint in relation to the imposition of a tax upon aviation power kerosene by moving an amendment at the committee stage.

Senator VINCENT:
Western Australia

– Having given very serious consideration to the measure before the Senate, with certain regrets, I move -

Leave out all words after “ That “, insert “ the Bill be returned to the House of Representatives with a request that it be amended to provide that no duty of Customs be imposed under item 229(b)(9) of the Customs Tariff on diesel fuel used in the carriage of ores, ore concentrates or unsawn limber whether over public or private roads.”.

The Senate will note that the amendment relates to the mining industry and the timber, industry, and that I am not seeking a total exemption for either industry. 1 seek a partial exemption which relates to the cartage of ore as it affects the mining industry and to the carting of unsawn limber, that is, logs, as it affects the timber industry. I am forced to incorporate provision for both industries in the one amendment, because I shall have only one opportunity to speak during the second-reading stage.

My purpose in moving the amendment is twofold. In the first place, I naturally aim to assist to some extent the industries to which I have referred, for reasons that I shall state in a moment. Secondly, I wish to show, by every means in my power, how important it is that these great primary industries - I emphasize that they are primary industries - should not be further taxed at the moment. The Government should keep its hands off the mining and timber industries, for the reasons I hall give. I hope to persuade the Senate that I am justified in making that statement.

The proposed legislation will exempt from the tax diesel fuel consumed by vehicles using private roads. I believe that that partial exemption was granted - the Minister will correct me if T :>m wrong - in the belief that both the mining industry and the timber industry use private roads to a very large extent for the cartage of ore and log timber. I suggest that the Government was very badly misinformed. In point of fact, both industries use to a very large extent what the Government has classified as public roads. Both industries use large quantities of diesel fuel in operating on public roads. Neither industry uses private roads to any great extent now, although it is true that in years gone by both industries did use private roads. At one time, a mining company utilizing four shafts constructed a treatment plant at the head of each shaft - it had as many treatment plants as it had shafts - but, with the increased cost of mining, that procedure was abandoned, and the modern method is to construct one central treatment plant, to which the ore is carted from the various shafts. The same procedure is adopted, very largely, in the timber industry, the logs being brought to a central mill.

The fuel which the mining industry uses for carting ore to treatment plants is mostly diesel fuel. In passing, I might mention that some years ago, when the change-over from petrol to diesel fuel was in process, inquiries were made of the Government as to the possibility of diesel fuel being taxed, and the answer given was that it would not be taxed. Nevertheless, we have now this sudden imposition of a tax on diesel fuel, which falls very harshly upon mining companies which are using diesel fuel for the transportation of their ore. Coming suddenly, almost overnight, it is causing them great embarrassment.

I intend to deal with the two industries separately. First of all, I shall say why I think that this request should be accepted so far as it applies to the mining industry. In the first place, the mining industry at present is in an extremely depressed condition. I refer to the mining of both base metals and gold. Secondly, this tax is to be imposed upon an industry that cannot pass on the burden of increased taxation. Thirdly, the tax is to be imposed upon an unfinished mining process, namely, the cartage of ore. Fourthly, in many cases mine-owners have constructed, without assistance from government funds, the roads that they use for the cartage of ore. The money collected from this tax will not be used to finance the maintenance or construction of such roads.

I want to make some observations on the four reasons I have given in support of my contention that the Senate should look with favour on this request as it applies to the mining industry. I have said that the industry is in a depressed condition, in regard to both base metals and gold, I do not think I need to emphasize that proposition. The best yardstick is the fall in the price of base metals over the past few years. For the sake of convenience, I shall quote the price of base metals at so many Australian pounds per unit. In 1952, the price of copper was £416 per unit; it has now dropped to £190 per unit. In 1952, the price of lead was £17 10s. per unit; it has now dropped to £13 10s. The price of tin in 1952 was £127 per unit; it has now dropped to £93 per unit. The price of wolfram was £80 per unit in 1952; it is now £15. The price of tungsten, from which we produce scheelite - this should interest honorable senators from Queensland, where a very important scheelite mine is situated - has fallen from £268 per unit in 1952 to £105 per unit. The price of zinc has fallen from £18 per unit in 1952 to £10 10s. per unit.

I think those figures present a fair picture of the present condition of the base metals mining industry. 1 express not only my personal view, but the view of every Chamber of Mines in Australia and every economic authority from the “ London Economist “ to the “ New Statesman and Nation “, when I say that it cannot be denied that the good old days of base metalmining are over and that the industry faces depressed conditions which will last for some time.

When we come to consider the price of gold, let me remind the Senate that the price of gold has not risen since the days of the depression, except for a variation resulting from an alteration of the currency in 1949. I wonder how many wheat farmers would consider growing wheat to-day at depression prices. I wonder whether it would be possible for wheat to be grown at those prices. The gold-mining industry is still producing gold at a price fixed, not by the industry, not by this nation, but by an international body. The gold produced in Australia now is, in fact, compulsorily acquired at the price that ruled during the depression.

I make those points merely to emphasize that both the base metal industry and the gold-mining industry are in a depressed condition. I ask any honorable senator who may doubt this whether he would care to underwrite any gold, silver, lead or copper mining company at the moment. The real test is the effect upon the investor. I warn honorable senators that only the investor can keep the industry going but that, to put it plainly, he is no longer investing in Australian mining. The reason is simply that the returns are not commensurate with the risk entailed. Under those circumstances, would any one assert that the mining industry should be taxed still further? J do not deny that the amount of the proposed tax is not large, but 1 must say, that at this stage, the action which the Government is taking, is wrong. It will have a fatal effect upon mining investment which, after all, is the most important element in the future of the mining industry.

My second reason for submitting thisamendment is that the mining industry is perhaps unique in not being able to pass on to the consumer the burden of additional taxes. Every one knows that gold is compulsorily acquired at a fixed price, and that all base metals are sold at world parity. That price will not rise because a new tax has increased the cost of production. The interstate road haulier can increase freights as soon as the proposed tax is levied. The public or private bus company can increase fares, and the product of certain primary industries will probably become dearer. For instance, Saturday’s Western Australian press reported that, because of a freight increase the price of wheat would be raised. Such other primary industries as sugar production and dairying will also be able to pass on the new tax burden. Indeed, virtually all industries other than the mining industry - which is not subsidized and must sell on world markets - will be able to doso. It is grossly unfair to expect the mining industry to find additional taxation during its present economic instability.

I have said that my amendment is also prompted by the fact that the tax is to be imposed upon an incomplete mining process. Diesel fuel is used by mining concerns mainly for the cartage of ore from shaft to treatment plant. As soon as theore is broken up and hauled it is taken inlarge diesel trucks to the treatment plant, which, in some cases, is only a few hundred yards away. In others it is miles away. My point is that at that stage of the mining process there is no way of knowing with certainty that the ore will be profitable. In many of our mines it is unprofitable at the moment. Will the Senate agree to a tax upon the carriage of ore which is, in fact, unprofitable? I know perfectly well that that will not be true of much of the ore that is produced, but it will certainly be true of a substantial quantity. It is most inequitable to tax any private industry before it is known whether the output will be profitable. Would any farmer - Senator Wade for example - agree to his growing, wheat being taxed before he knew whether it would bear grain? That is precisely what the Senate intends to do in the case of the mining industry, lt is proposed to tax the carriage of the ore - before its mineral content is known.

Senator Wade:

– We have to pay land and pay-roll taxes!

Senator VINCENT:

– But your crop is not taxed while it is growing. The tax is levied only when a profit has been made. Unfortunately, the Senate proposes to tax something that is halfway through the mining process - the end result being, at that stage, quite unknown.

I have had some little experience of mining. I suppose that I am the only senator who lives in a country mining area. Many mining companies carry their ora over lonely bush tracks. They are public roads within the meaning of this legislation because any one may pass over them. The point is that nothing does - except mining vehicles and plant. As honorable senators are well aware, in most cases mines are situated far from the main road system. In most cases the ore is carted, not over main arterial roads, but along bush tracks, many of which have been made by the mining companies. For instance, Bell Brothers Limited pioneered the mining of manganese in north-western Australia and tolerated all the hardships associated with such a venture in an isolated region. The company built its own road, 140 miles long, from a place called Woody Woody to Skull Springs, buying bulldozers and plant for that purpose. Last year it spent £11,000 upon making and maintaining that road - money that would otherwise have gone into the pockets of its shareholders.

Senator Henty:

– Was the company not granted a taxation concession in return for that expenditure?

Senator VINCENT:

– I know that Senator Henty is dying to get to his feet to say that the tax will enable the States to make the roads that the mining companies need. My answer is that the States will not. Indeed, no State could be expected to provide roads for such isolated projects. Western Australia, Queensland and the other States with mines in isolated areas refuse to undertake the task of roadmaking in such places. Very properly, State governments spend the money available to them upon the roads that carry the most traffic. I submit that the roads that are substantially used by the mines and, as in cases like that of the Bell Brothers, have been made by the mines themselves, will not be objects of the expenditure of one penny of the yield from this tax. Very properly the revenue from the tax will be devoted to work on roads that have commensurately heavy traffic. It is quite proper for a State to give priority in the expenditure of road moneys to the roads which bear the most traffic. The roads of which I am speaking do not carry much ordinary traffic and it is perfectly obvious that they never will. In those circumstances I think I am right in saying that none of the money yielded by this tax will be spent on those roads, and so will not assist the mines concerned one iota.

I believe the Government is most sympathetic to what I am advocating. I have been informed that the Government’s main problem on this matter, however, is that it feels that it cannot discriminate between the mining industry and other industries. I believe the Government is perfectly conscious of the very serious situation with which- the mining industry is faced, but is saying, in effect, that it would not be logical to discriminate in favour of that industry. It says, “ If we tax one industry, we must tax all “. With the greatest respect, Mr. Deputy President, I submit to the Government that it might be logical to argue along those lines, but it is not just. The Government,, as has every government since the earliest days, of federation, has always discriminated between industries where it is felt that it would be just to do so. The whole of our taxation law is riddled with instances of discrimination between industries. There is discrimination in the taxation provisions relative to the agricultural industry and the pastoral industry. The provisions for those industries include a five-year averaging system. That is discrimination. It is not logical, of course, but I suggest that it is just. The Government cannot have it both ways. If it is just to discriminate in regard to agriculture it is just to discriminate in regard to mining.

Again, there is discrimination - and very properly so - in the taxation provisions relating to depreciation and, once more, the agricultural industry and the pastoral industry, very properly, are the objects of this beneficial discrimination. I reject utterly the argument that at this stage the Government cannot discriminate in favour of the mining industry on the ground that that would not be logical. I may admit that it would not be logical, but I suggest that it would be just.

The pastoral industry and the agricultural industry also have the benefit of discrimination of special tax deductions for capital improvements. This benefit is denied to the mining industry. Why should one industry receive such a benefit while another industry is denied it on the ground of illogicality. 1 submit that the official argument in that connexion is fallacious, and I reject it. Every time the Tariff Board makes a finding in regard to our secondary industries, it puts in motion an act of discrimination which we, in this Parliament, ratify. So, I invite the Minister to give serious consideration to that aspect of this case, and to deal with it when he replies to the debate.

I have given reasons why I think there should be some discrimination in favour of the mining industry. I repeat that the mining industry is in a serious situation to-day, and that it would be illogical and most unfair to impose this tax on that industry in its present depressed condition, because of the effect not only upon the industry itself, but on future investment - the lifeblood of all industry. It would be wrong to tax this industry further, because the tax proposed is a tax that will be imposed on an uncompleted mining process at a stage when it would not be known whether the ore to be carted will prove to be payable or not.

Finally, I submit that ore from the mines I have mentioned is, in the main, being carted over lonely bush roads on which no money from the yield of this tax will be spent. For the reasons I have given, I suggest that the Senate should seriously consider, and should accept, my amendment.

The amendment also concerns the timber industry, to which every argument I have used to-day in reference to the mining industry applies with equal force. Last year, the timber industry in Western Australia put off 300 men because it was failing. I do not think anybody will deny that the timber industry in Western Australia - and

I believe the position is the same in other States - is in a serious situation. I could tell the Senate, if 1 had the time at my disposal to do so, of some of the serious losses that have been incurred by timbermillers in Western Australian over the past twelve months, lt has been found that the timber industry cannot compete with imported timber. There is, at the moment, an excess of timber in the world, and, due to high costs of production, our timber industry is suffering the consequences.

I wish to refer, briefly, to the situation in which this industry is placed. It is in a similar position to the mining industry. In the main, the timber industry carts its logs to the mills over bush tracks which, in many cases, the mills themselves have made. I emphasize that the yield from this proposed tax will not provide one penny for the maintenance of those roads. I think that at this stage we should be giving very serious consideration to reducing taxes on the timber industry instead of being in the process of imposing on it a fresh tax which will prove to be a calamity for that great primary industry. 1 do not want to emphasize that point any more, because I think I have made my case; but the Senate should remember two or three things about my proposition. In the first place, I am not claiming that the mining industry and the timber industry should be completely exempt from the payment of this tax. They, like all other industries, will pay the higher cost of freight that this tax will involve. They are prepared to accept that; but, because of the special circumstances that I have mentioned - and I believe that there are special circumstances - I suggest that the Senate should seriously consider agreeing to my amendment. An additional reason is that if we do not call a halt we will. I think, find that one of these days we will have a bankrupt timber industry and no mining industry at all.

The DEPUTY PRESIDENT (Senator the Hon. A. D. Reid). - Is the amendment seconded?

Senator SEWARD:
Western Australia

– I second the amendment. As the mover, Senator Vincent, has pointed out, the gold-mining industry is one of the big industries on which Western Australia is, and has been for many years, dependent. He has also pointed out that this industry is deteriorating to such a degree that the Commonwealth Government has seen the necessity to assist it by means of a bonus provision in order to keep it going and enable it to meet the high costs with which it is faced at present, particularly when the price of gold is fixed. As is generally known, the ore has to be taken to a central treatment plant in order to be treated. Every mine could not have its own treatment plant. Some of the big mines in Kalgoorlie have their own plants, and they will not be greatly affected by this tax.

It must be remembered that the goldmining industry is dependent upon the prospector who seeks and finds gold. When ore is found, it has to be brought to a treatment plant. The cost of transport of ore will be increased greatly as a result of this tax. Those honorable senators who have been to Kalgoorlie or Coolgardie will recall that the towns are surrounded by tracks leading in all directions to various mines, perhaps five, ten, fifteen or twenty miles away. The tracks were made by persons going to and from the mines, and it is along those tracks that the ore has to be carted. The most economical method of carting ore at present is by diesel trucks. If a tax is levied on the diesel oil used by those trucks, the cost of bringing ore in for treatment will be increased. Prospectors want to know whether ore will be profitable or unprofitable. Before that can be determined, the ore must be brought in treated and sampled. If the ore is found to be profitable and the find is a good one, the activities of the dying gold-mining industry are stimulated. I know that people will say, “’ What is the use of gold-mining? We used to be on the gold standard, but we are not now, and in any case most of the gold in the world is locked up in vaults in America.” But gold is still a very valuable mineral and worth mining.

Senator Cameron:

– It is still used as international currency.

Senator SEWARD:

– That is so. What is more important is that it is a very important part of our exports. The value of our exports of primary products fluctuates because of seasonal conditions, but gold maintains its value year by year.

Senator Brown:

– What price would Australia get if its gold were sold freely on the world’s markets?

Senator SEWARD:

– The honorable senator’s guess is as good as mine. That is not the point with which I am concerned. I am concerned with encouraging prospectors to find new fields to replace depleted fields so that our gold-mining industry can be kept in existence. The roads which we are discussing are not public roads. The only people who use them are people going to and from the mines. If a mine goes out of existence because operations are no longer profitable, the road to it gradually goes out of existence. I refer particularly to Western Australia because it is the major gold-mining State. Those who are familiar with Western Australia will recall the disused roads and the newer roads that abound in gold-mining districts. The trucks carrying ore do not cut up public roads. Public roads are in a different category. When they are cut up by heavy vehicles, more money must be made available for their maintenance. When Senator Vincent was speaking, I think another honorable senator interjected to say that the State would build these roads to which 1 am referring. I do not think so. If the State did so, our Victorian friends would say, “ You are making roads to mines to be cut up by heavy traffic “. I assure the Senate that the State does not build these roads, because there is nothing to warrant such a course. The carriers who go out to the mines make their own roads. Some people travelling over these roads might think that they were made by snakes, because they wind so much.

I am concerned about this extra impost on the gold-mining industry. For some considerable time we have had requests from the industry for assistance to enable it to carry on. Only a few weeks ago I received an appeal from tin-mining interests at Protheroe, 30 miles north of Geraldton, for assistance to keep the mine going in the face of the considerable fall in the price of tin in the last few years. A copper mine was started at Norseman a few years ago, owing to increasing prices for copper and after an analysis by some Germans, but this mine is now almost out of existence because of the subsequent fall in copper prices. An additional impost on the cost of cartage of ore would put mines out of production more rapidly. Similar considerations apply to the tin-mining industry at Greenbushes. I have received requests from there for assistance to reduce the cost of treating ore, which has to be brought a substantial distance and treated before it is fit to go on the market. For all those reasons, I support Senator Vincent’s request for some relief for the mining industry.

As the honorable senator also mentioned, the .timber industry in Western Australia has been petitioning the Government for a considerable time for some relief in order to enable it to compete with imported timber. We have excellent timber in Western Australia, of a type required by the bousing authorities in South Australia, but it cannot compete with timber imported from Malaya and other countries. If costs are increased by a tax levied on the oil used in cartage, Western Australian timber will be pushed out of the market.. The additional cost would not need to be very great to achieve that effect. Unfortunately, the State Government, which is misguided in some respects, has decided to close some railway lines in Western Australia, including the Une from the timber mill at Normalup to Elleker, a distance of about 80 miles. When the timber could be sent by rail from Normalup to Adelaide, it competed with Malayan timber, but when the railway line was closed and the timber had to be sent from Normalup to Elleker by road, an extra cost of 6d. per 100 superficial feet was involved in cartage over that 80 miles. As a result, the timber was priced out of the Adelaide market. The State Government had to come to the industry’s aid and subsidize road transport. That shows how narrow is the margin between profit and loss in marketing.

Our forestry reserves are full of tracks which are used for the haulage of timber from the bush to the mills for cutting up and other treatment. This tax should not be imposed on the fuel consumed by vehicles using those roads. They are roads used entirely for the haulage of timber; they are not public roads. This extra tax will be a serious matter for the timber industry. I read in the press within the last couple of days that the price of Oregon timber in the eastern States has decreased. That will have a serious effect on the timber industry in Western Australia. Although these extra charges may seem small in themselves, in total they mean the difference between a profit and a loss for these industries. I support the request. I hope that the Senate will agree to it in order to give these two industries, which are of such importance to Western Australia, and to Australia generally, a chance to meet “the competition that they face to-day in all markets.

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– The subjectmatter of the request was, of course, taken fully into consideration by the Government before it made its decision. Representations were made to us. Senator Vincent was most active in placing before the Government the position of the Western Australian mining and timber industries. The matter was given every attention and consideration.

Some of the arguments that he has advanced to-day will not impress the Senate, because the remedies for the difficulties he mentioned are obvious. For instance, both he and Senator Seward spoke about the bush tracks leading to timber mills and to mines, over which no other transport travels. They should be private roads, in which case no diesel fuel tax would be payable for haulage over them. If they were classified by the States as main roads, then it is quite obvious that the States themselves could remedy the position by declassifying them. It should be remembered that the States are to receive an additional £3,000,000 to help pay for repairing the damage done to these roads by timber and other heavy road hauliers.

I think the principle adopted by the Government is fair and just. It is that this tax shall apply to all diesel-propelled vehicles using public roads. After all, we must be fair to the department that will be charged with the responsibility of administering this law, and I point out that it would be an administrative horror to be required to ask a mine how many miles its trucks travelled over bush tracks, and so on. I had intended dealing with administration, but as Senator McKenna has reminded us that a bill dealing with administration is to come before the Senate, I shall advance no argument on that subject except to say that we have widened tremendously the scope of the certificate system in the new administration set-up, and that, in itself, will make a difficult administrative problem. I think every fair-minded man. will, admit that: administratively the implementation of the proposed amendment is almost an impossibility.

I should have thought that honorable senators would be submitting a case for the reduction of petrol tax to these industries. If the small addition of the diesel fuel tax is to have such a tremendous effect upon these industries, I should have thought that over the last two or three years we would have heard a case put forward for a reduction in petrol tax to those who use petrolpropelled vehicles, as some of them do. We have heard nothing of such a case. f think it is interesting to endeavour to consider this tax in relation to profits. On examining the position of one mine - I think it was called Hill Fifty - I discovered that it showed a profit of approximately £1,000,000 for the year. We are asked to provide a rebate for that mine because marginal mines are not doing so well. I remind honorable senators that the Government has just increased its assistance to marginal mines. From memory, I think the assistance was increased from 30s. to £2 an ounce. I emphasize that it is the marginal mines that we are seeking to assist, and 1 honestly do not think that we would help them to any extent by exempting them from the diesel fuel tax.

I do not deny, nor do I think any honorable senator will deny for a moment, that the position of the base metal mining industry is causing extreme concern to us all. It is my belief that if the present position continues, the government at that time will be faced with an acute problem in connexion with mining for base metals; but I do not think that the little bit of money these mines are to be required to pay in respect of their vehicles that use public roads will make any difference to them, especially when it is remembered that so much money is being returned to the States.

Senator Cole:

– It will help Mount Lyell a lot.

Senator HENTY:

– Mount Lyell will not pay anything because its ore is carried from the mine to the crusher by diesel trucks over private roads. It will not pay any tax under this bill. Further, the company transports its materials over a railway system using diesel fuel, and again no tax. is payable.

Senator Cole:

– But still its vehicles have to travel down the Gormanston road..

Senator HENTY:

– That is so. A little tax will be payable there, but not so very much. That example serves to illustrate the extreme difficulty confronting the administration in connexion with this problem. I reiterate that I think the principle of applying the tax to all diesel-propelled vehicles using public roads is fair, just and sound, especially when it is remembered that not only the amount collected by way of the tax but also a further £1,000,000 is being returned to the States for expenditure on repair and maintenance of roads.

Senator Vincent will know that the Government looked at this matter very closely, and I freely admit that he put forward a good case at the time. I mention here that only a short time ago I attended a meeting of the timber interests in Tasmania and was heartened indeed to learn that those interests believe that the timber industry is now being rehabilitated, that the demand for timber is rising. I remind honorable senators also that the Tariff Board is now considering the position of the timber industry; I have not the foggiest notion what the board’s recommendations will be.

Senator Critchley:

– Help the timber industry by building more houses.

Senator HENTY:

– More houses are being built, and this again is encouraging.

Senator Ashley:

– The rate of building is still too slow.

Senator HENTY:

– We may differ on that. The demand for timber is increasing. If the timber industry is becoming rehabilitated, and if, within the next two or three weeks, the Tariff Board recommends that assistance be given to it and the industry again becomes profitable, as it has been over the last few years, where is there any argument for exempting it, on the grounds of profitability, from this tax which must be paid by other industries? After all, the profitability position changes from six months to six months, and I think that is a very weak basis indeed upon which to build a case for exemption from this tax.

Senator Vincent:

– Do you say the timber industry is in a healthy state?

Senator HENTY:

– I did not say it was in a healthy state. Do not misquote me. I said I attended a meeting of timber interests in Tasmania and that those timber interests pointed out that there were healthy signs of the industry’s becoming rehabilitated. I also stated that the Government, because it is fully aware of the importance of the timber industry, has referred the position to the Tariff Board for investigation. After all, the Tariff Board is an independent authority, and it is being asked to investigate and determine the position of the timber industry.

Senator Seward:

– And the industry will get assistance in the next few weeks?

Senator HENTY:

– I did not say anything of the sort. 1 said I did not know what the Tariff Board’s recommendation would be. 1 also pointed out that it would be foolish at this stage to help an industry which might be helped shortly by a competent independent authority, the Tariff Board, to which the Government had referred the matter.

Senator Seward:

– Then we can impose the tax, if necessary, after the Tariff Board recommends assistance.

Senator HENTY:

– If the honorable senator wants to play around with the matter like that, he can administer it, for, believe me, it does present an acute administrative problem! 1 point out also that all these industries are using both petrol and diesel fuel and that the sole objective of imposing this tax is to bring in for the States additional moneys for the repair of roads which have been damaged by heavy hauliers. I read with interest in the newspaper published in my own little town only yesterday of the presentation of a petition by 119 residents of a town Senator Aylett would know - Nabowla - to the local council asking that body to desist from giving permits for the haulage of logs over its roads because of the enormous damage being done to the main outlet road. It is the main roads which are being damaged, and it is for the repair of such roads that we are giving Tasmania an extra £150,000. This diesel fuel tax is the source of that money.

When this suggested amendment was put before the Government, very close and earnest consideration was given to it, and, on behalf of the Government I can onlysay that the Government cannot accept it.

Senator KENNELLY:
Victoria

.- I support the case submitted by the Leader of the Opposition (Senator McKenna) relating to that part of this bill which deals with the tax on aviation kerosene. I do not propose to traverse the whole of the ground covered by him. Suffice it to say that we on this side of the Senate - I am sure the people outside agree with us - believe that this tax is being imposed, as we said when discussing another bill, to bring TransAustralia Airlines back to the field. I asked a question recently about the amount of tax that would be collected from this source. I was told that the collection from T.A.A. and Butler Air Transport Limited would total £339,000 in a full year. A similar question was asked in another place and the amount given was £362,000.

Senator Henty:

– Those figures did not come from the Department of Customs and Excise. We do not disclose confidential information.

Senator KENNELLY:

– I do not wish to imply that there was any thought of misleading anybody with those figures. The information was given in another place that the tax on aviation kerosene used by airlines within Australia would amount to £362,000 in a full year. There is no need for me to tell the Senate what the amount would be if we included the fuel used by international airlines like Qantas or B.O.A.C.

Senator Scott:

– Were the questions asked of the same Minister?

Senator KENNELLY:

– No. As a matter of fact, I believe that the information that was given in another place was obtained from the Minister for Air (Mr. Osborne). I can only say that the figures differed by £23,000. The amount is not large but it is important when similar information was requested in both Houses of the Parliament.

The Leader of the Opposition in the Senate has put the Opposition’s case in connexion with the duty on aviation kerosene. I wish to refer to the amendment that has been moved by Senator Vincent. I believe, as the Minister for Customs and Excise has stated, that the Government proposes to place a tax on diesel fuel for the express purpose of assisting the States to meet the cost of damage that is done to roads by the users of diesel fuel, particularly those with heavy haulage trucks. I have listened to the plea that has been made by Senator Vincent on behalf of the mining industry. Only recently, the Parliament approved an increase in the gold bounty. It is now up to £2 an ounce. Senator Vincent did not refer to the tax concessions that are granted to persons interested in gold-mining.

Senator Scott:

– Is the honorable senator opposed to those tax concessions?

Senator KENNELLY:

– No, but if Senator Vincent wants to convince us that this tax will cause great hardship tothe goldmining industry, we are entitled to see the whole picture and not merely half of it. I am not opposed to the mining industry. As Senator Vincent has said, prices of everything else but gold and base metals have risen. We know the reason for that. I admit that there has not been a corresponding rise in the price of gold, but to some extent an attempt has been made to achieve a balance by allowing tax concessions and by the payment of a gold bounty.

I do not know anything about the timber industry in Western Australia, but I do know something about the timber industry in Victoria. Since 1939, successful efforts have been made in Victoria to take the mills out of the bush and put them into the towns. I can cite the timber mills at Heyfield. There are four or five mills in Gippsland and logs are hauled many miles. There is very heavy haulage from the area around Erica along the main Gippsland road. The tax on diesel fuel has been imposed to help the States to meet the cost of maintaining roads. The Senate has already agreed to the distribution of £2,000,000 that is to be raised this year by the tax in addition to £1,000,000 that is to be provided by the Government. In the next two years, the tax is expected to yield £3,000,000 a year, and all that money will be devoted to State roads.

The Opposition cannot support the amendment because we do not believe that it meets the situation. Senator Vincent spoke of roads which were being built by persons who are interested in mining. That is not to say that once they go outside the mining property the roads will become public roads.

Senator Vincent:

– The Minister for Customs and Excise has said that they should be private roads.

Senator KENNELLY:

– How can they be private roads when they are outside the property?

Senator Vincent:

– The honorable senator should ask the Minister.

Senator KENNELLY:

– I never interfere in discussions between supporters of the Government. I leave them to enjoy themselves. I am interested in this tax, however, because there are four and a half miles of private roads in a suburb of Melbourne in which I am interested. The contractors who use them will not be affected by the tax so long as they remain private roads. I do not believe that the case that has been submitted in support of the amendment is a valid one.

Senator Vincent has referred to the prices of various minerals. Nobody wants to see the mining industry go out of existence, but we must be rational in our approach to this matter. When we consider that the revenue to be derived from all users of diesel fuel on public roads throughout Australia will be only £3,000,000 a year, it is evident that the amendment would not grant any substantial relief to the mining company. Usually, I do not go to the assistance of a government when in opposition, but the circumstances in this case force me to oppose the amendment.

Question put -

That the words proposed to be left out (Senator Vincent’s amendment) be left out.

The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)

AYES: 4

NOES: 49

Majority . . . . 45

AYES

NOES

Question so resolved in the negative.

Amendment negatived.

Original question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I refer to item 229 of the schedule, which reads in part -

The amendment seeks to delete the whole of the item as it relates to aviation kerosene. I have advanced an argument in support of this proposition on two occasions very recently in this chamber, and I do not propose to develop it again at this stage.

I think the Minister for Customs and Excise (Senator Henty) willnot be taken by surprise if I leave the thought with him and merely submit the amendment in the light of arguments I have already advanced. Although the Opposition will seek to carry this proposal to a division if the Minister is not prepared to accept it, I shall be prepared to accept a decision on it as being a decision on the same kind of matter in the Excise Tariff Bill 1957.

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– As Senator McKenna said, this matter has already been canvassed. I regret to say that the Government is not prepared to accept the amendment, because it thinks it is fair to impose a tax on all kinds of aviation fuel. I am sorry that apparently Senator Kennelly received two different sets of figures.

Senator Kennelly:

– I got one set, but somebody else got another set.

Senator HENTY:

– I hasten to assure the honorable senator that, although the Department of Customs and Excise was asked a number of times for figures, it would not make them available because they were confidential. The department does not disclose confidential information pertaining to its customers. However, I believe that all the information was published in the T.A.A. report and so became available generally.

The Leader of the Opposition referred to the amounts of fuel consumed in turbo-jet aircraft and petrol-engined aircraft. The Vickers Viscount, a turbo-jet aircraft, uses 300 gallons of power kerosene an hour, and the DC6B uses 300 gallons of petrol an hour. With the tax on power kerosene at6½d a gallon, operators using turbo-jet aircraft still have a margin in their favour. I regret that I cannot accept the amendment. I am still not soft-hearted enough.

Senator McKenna:

– Will the Minister say something about primage? Primage duty has been removed from aviation spirit, but not from aviation kerosene.

Senator HENTY:

– I referred to this matter when the Leader of the Opposition raised it during the debate on, I think, the Civil Aviation Bill. Most of the power kerosene used by Australian airlines is manufactured locally. No primage duty is imposed on locally produced fuel. The Tariff Board recommended a protection of 1½d a gallon for aviation spirit produced locally. The primage duty of 10 per cent, amounted to 2d. a gallon. By removing the primage, a protective margin of lid. a gallon was provided. That was in accordance with the Tariff Board’s recommendation. The removal of the primage was a simple way of providing the protective margin recommended by the Tariff Board to protect the local industry.

Question put -

That the House of Representatives be requested to amend the bill by leaving out the words proposed to be left out.

The committee divided. (The Chairman - Senator the Hon. A. D. Reid.)

AYES: 27

NOES: 28

Majority . . . . 1

AYES

NOES

Question so resolved in the negative. Request for amendment negatived. Bill agreed to.

Bill reported without requests; report adopted.

Bill read a third time.

page 1707

EXCISE TARIFF BILL 1957

Second Reading

Debate resumed from 14th November (vide page 1260), on motion by Senator Henty -

That the bill be now read a second time.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 1707

TARIFF BOARD

Reports on Items.

Senator HENTY:
LP

– I lay on the table of the Senate the reports of the Tariff Board on the following subjects: -

Cathode ray tubes. Euclid twin power scrapers. Floor polishing machines. Hats, caps and bonnets. Paper and paper products. Passionfruit and passionfruit products. Tractors and rotary hoes up to and including 10 belt pulley horse-power.

Sitting suspended from 5.36 to 8 p.m.

page 1707

ACTS INTERPRETATION BILL 1957

Bill returned from the House of Representatives without amendment.

page 1707

FLAX FIBRE BOUNTY BILL (No. 2) 1957

Second Reading

Debate resumed from 3rd December (vide page 1646), on motion by Senator Henry -

That the bill be now read a second time.

Senator KENNELLY:
Victoria

.- This bill is a further amendment to the 1954 legislation - in fact, it is the third amendment of that legislation. With each amendment the bounty payable on Australian flax fibres has been increased. In 1954 the rate of bounty was £35 a ton while the price of imported flax was £330 a ton. Provision was made for the bounty to increase or decrease by £5 for every £5 by which the price of imported flax was more or less than £330 a ton. The bounty paid in the year ended 30th June, 1955, was £4,907.

In 1957, the bounty was raised to the rate of £50 a ton and was payable when the price of imported flax fibre was £300 a ton. 1 think that provision for the bounty to fluctuate in accordance with the price of imported flax fibre was continued. The total amount of bounty that has been paid is, in round figures, £112,000.

According to the second-reading speech of the Minister for Customs and Excise (Senator Henty), the Government has given further consideration to the Tariff Board’s report on this industry and has agreed that the bounty should be paid until 31st October, 1960. Clause 4 of the bill provides that the rate of bounty shall be as follows -

  1. in the case of flax fibre sold before the first day of May, One thousand nine hundred and fifty-seven - Fifty pounds per ton;
  2. in the case of flax fibre sold on or after the first day of May, One thousand nine hundred and fifty-seven, and before the first day of November, One thousand nine hundred and fifty-eight - Sixty-five pounds per ton;
  3. in the case of flax fibre sold on or after the first day of November, One thousand nine hundred and fifty-eight, and before the first day of November, One thousand nine hundred and fifty-nine - Sixty pounds per ton; and
  4. in any other case - Fifty-five pounds per ton.

The bounty is to be paid so long as the price of imported fibre is £300 a ton. This bill also differs from its two predecessors in that the provision in respect of fluctuations ceases if the price of imported fibre increases to £310 a ton. The bill also differs from its predecessors in that there is no limit on the amount of bounty to be paid, although the Minister mentioned in his second-reading speech that it was expected that the total would be £90,000.

I suppose that this industry has had greater fluctuations in its fortunes than any other industry. For many years flax has been grown in Victoria. Little success has favoured the industry except during war-time, when flax fibre became very important to the allied war effort. That happened first during the 1914-18 war, when the flax industry prospered. Victoria is the principal flax-growing State. It grows more flax and has more flax mills than any other State. After the 1914-18 war the flax industry went out of existence, to all intents and purposes.

With the start of World War II. the Australian flax fibre industry again prospered, because Australia not only had to meet its own needs for flax but also had to help to replace the flax Britain had obtained from Belgium and Russia in peace-time. Those supplies were cut off by the war. So Australia was urged to plant a greater acreage to flax in order to supply not only our needs but also those of the Mother Country.

It is stated that during the peak production period up to 70,000 acres were under flax, and that there were 39 flax mills in the Commonwealth. History has repeated itself. What happened to the flax industry after the 1914-18 war has happened again. The Minister estimated, in his speech, that the production of flax last year was only about 817 tons from about 4,500 acres. The industry was first controlled by the Flax Production Committee, which went out of existence when the Government appointed the Flax Commission. According to a report by that body, it is estimated that an area of 10,000 acres is necessary to place this industry on a firm footing. What everyone is concerned about is that flax is vital to our defence. The Tariff Board’s report says that the reason the industry is in its present state is the dumping of lowgrade fibre from Russia at a very low price. 1 have read that it is believed that the price is below cost of production. One does not know what the cost of production in Russia is. although one may know what the cost of production here is.

Last year the nation spent £100,000 on this industry. 1 refer to the trading losses of the Flax Commission. We must consider that in the light of the present international situation. I would be the last to try to emulate the Prime Minister (Mr. Menzies) by forecasting when the next war will come - whether in one year, two years or three years; but I should like to repeat a question that has been asked in another place also: Since we have been spending roughly £190,000,000 a year on defence, would not this industry be worth saving? I ask that question because everybody knows how essential the industry will be in the event of this country becoming engaged in hostilities. What I ask myself, after hearing the Minister’s speech, is whether the bounty is worth while at all, seeing that it is the Government’s intention to get rid of the mills. All the mills, except one in Western Australia, operate under government control. In Victoria, there are mills at Colac, Strathkellar, Ballarat, Lake Bolac and, I think, Drouin. There were also mills in the Penshurst district, but they were closed some little time ago. The Government is still pursuing its policy of trying to dispose of government-owned undertakings. What is the use of producing flax, and what is the use of the Government extending bounty payments, unless there are mills to process the flax? If these mills go out of existence, it will be useless to grow flax. A recent issue of the “ Journal of the Department of Agriculture “ in Victoria stated that any one who desires to grow flax ought to know whether it can be processed after it is grown. Although Senator Scott might like to see all flax grown in Australia sent to the co-operative factory in Western Australia, that would be an economic absurdity.

I wonder for how long the flax industry will run? The Tariff Board has reported that the reasons for the position of this industry to-day are the low cost of Russia’s low-grade fibre and the outmoded machinery in our factories. How will the Government ever get any one to buy the factories? It is Russia to-day, but perhaps to-morrow another country will be able to dump flax fibre in Australia at a price with which we cannot compete. I do not think that the Government will be paying the bounty in 1960 unless it is lucky enough to find some one who is prepared to accept the very grave economic risk involved in taking over the factories.

What must interest every one is that this industry does keep little towns alive. At the outset, Penshurst, in western Victoria, had two flax factories. One was closed some years ago, and the second was closed fairly recently. I think that 22 people were employed at one factory when I was there. The regular wages received by those employees give a spark of life to a small town. Unless the Government finds some one who is prepared to buy these factories and to engage in the production of flax fibre from the raw material, I cannot see how the bounty will be used. Cessation of flax pro duction will do great damage to some small towns. If twenty are employed in a flax factory, earning between them £280 or £300 a week, the money that they spend in the town does much to keep the town alive. The loss of that revenue would have unfortunate effects on the town. v 1 know that this Government is in more or less the same position as was the government in power after the 1914-18 war. I am not opposed to the payment of a bounty, but I shall be more than surprised if even a very small amount of the money available is paid out, particularly in the last year of the period mentioned in this bill or in 1959. As a rule, farmers are hard-headed people. They are not foolish enough to grow a commodity when there are no facilities for processing it. I recall Senator Scott speaking about these factories some time ago. I do not think that any honorable senator would be opposed to the Government seeking offers to take them over. With the exception of Ballarat and Colac, the towns affected are all small. Those two towns would not feel very much the closing of the factories, because they are rather big centres, but Drouin, Strathkellar and Lake Bolac would feel acutely the loss of a couple of hundred pounds a week spending money. 1 hope that some portion of the industry will remain in existence. Personally, I do not see how it can, unless some one purchases the factories. A man would have to be pretty game to put hard-earned money into this industry. I hope I am wrong, but I think that in 1960 the Government will not be paying out much by way of this bounty, because very little, if any, flax will be grown. On behalf of the Opposition, I support the bill, but I reiterate that one cannot feel overjoyed at the prospects for the future.

Senator SCOTT:
Western Australia

– I am pleased to hear that the Opposition supports the measure, which is designed to give effect to the Government’s decision to pay a bounty for the next three years on flax line fibre grade B. Senator Kennelly has said that he cannot understand why the period should be extended by three years, because when growers know that the mills are closed they will not want to grow flax. On a previous occasion, when, if I remember correctly, all the mills were submitted for purchase by tender, the only mill sold was that at Boyup Brook in Western Australia, which was taken over by a co-operative organization supported by the State Government. In the past three years, this mill has operated fairly successfully, with the exception of one year when it suffered a considerable loss because the Blackwood River flooded and destroyed most of the flax which was stacked near the river. However, the Blackwood flax co-operative undertaking is quiet satisfied that, if the bounty remains at the present level, it will be able to continue with the work of producing flax fibre for Australia.

The flax industry was revived at the beginning of the last war. When Britain was cut off from her supplies, she looked round for countries that could turn their hands immediately to the growing of flax. The Australian Government set up the Flax Production Committee and, within a matter of a few months, it was decided to grow flax in Australia. Acreages were allotted to certain areas throughout the Commonwealth, and the Government set about establishing mills. Initially, some 39 mills were erected throughout Australia. Three were erected in Western Australia, one in Tasmania-

Senator Aylett:

– There were six in Tasmania.

Senator SCOTT:

– I am not sure of the number in Tasmania. It may have been six. The others were erected in South Australia and Victoria. Very early in the piece it was found that certain areas in Australia were not suitable for the growing of flax. I know that two mills were closed down in Western Australia within two years and others were closed down throughout the Commonwealth. The fact remained, however, that when war broke out England was very short of flax fibre and Australia, through the co-operation of the governments, the Flax Production Committee, and the farmers, was able to produce and process large quantities of flax fibre for the war effort. I should say that the achievement of the farmers concerned will go down in history as one of the greatest by the farming industry for many years. The farmers are to be commended for their effort in seeing to it that each of the mills had sufficient straw to process each year as the war progressed.

The growing of flax was not easy. It may be said by some that the farmers were able to make huge profits out of it. As one who was concerned in the industry in the early stages, I am able to say that flax production presented many problems. The farmers did not always get a satisfactory return, although I believe that was the least of their worries. It was necessary to bring to Australia special machinery for the cultivation and harvesting of flax. Certain areas that had not been cropped in the past were found to be excellent for the growing of flax, but the people concerned had to go to a great deal of expense in providing machinery necessary not only for the cultivation of the flax but for harvesting it when it was ready for delivery to the mill.

In the early stages, the Flax Production Committee paid bonuses on the straw delivered to the mill. It introduced that system because of the excess of weeds and other rubbish contained in the flax fibre in the early stages. The committee decided to pay an extra bonus of from 10s. to 15s. a ton on straw that was free of weeds, a further bonus on all straw 26 inches and over in length, a further bonus according to the quality of straw delivered to the mill and another bonus based on the quantity of seed harvested from the flax when it was threshed at the mill before scutching took place. By encouraging the farmers with this extra finance, the committee was able to get delivered to its mills first-quality flax from which could be made the firstquality fibre that was needed so urgently for the war effort.

As I have said, the farmers played an important part in this industry. In addition, because some of the flax varieties grown originally were subject to rust, the State Departments of Agriculture also played an important part in producing a rust-resistant variety. It may astonish honorable senators to know that within four years the officers of the Department of Agriculture in Western Australia were able to produce and supply to the farmers for sowing a completely rust-resistant variety known as, I think, Wadda. Not only was it completely rust-resistant, but it also gave a greater yield of fibre than the then known varieties. In the early stages the varieties grown were Lyral Crown and Concurrent, but they were subject to rust and many a crop was ruined by rust just as it was ripening. Thanks to the efforts of the Department of Agriculture, this new variety was developed. It was a magnificent achievement. Departments of Agriculture throughout Australia are to be congratulated on their efforts, in the interests of the industry, in developing rust-resistant varieties.

For a few years now, this Government has been concerned at the cost of keeping the flax industry going. Some time ago the Tariff Board recommended that a bounty should be paid to the manufacturers of line fibre. It recommended a bounty of, I think, £65 a ton, that figure to be reduced by £5 for the second year and for the third year, the bounty payments to extend over three years. That recommendation was made, I think, in 1954.

The Government decided not to adopt the Tariff Board’s recommendation but to carry on the industry for one more year to see what could be done. In the meantime, it set up a special committee comprising officers of various departments to investigate the whole problem of flax growing in Australia. In its report that committee also recommended that the industry should be granted a bounty for the three-year period ending 31st October, 1960. That is the reason for the bill.

I have read a statement that the maintenance of the flax industry is no longer necessary from a defence point of view. The Government’s advisers on defence have Stated that they do not require flax to be grown in Australia. Up to now, the production of flax in Australia has been justified only in the interests of defence. Senator Kennelly has stated that the industry has been costing the Government only about £100,000 a year, and that that amount was very small in a defence vote of £190,000,000 to £200,000,000. I agree with Senator Kennelly, but the fact is that the Government’s advisers no longer place any importance on the production of flax fibre for defence.

We know that if we continue to produce flax, the cost to the Government will be between £100,000 and £150,000 a year, and that cost will continue as long as the Government maintains the industry on the present basis. There are two alternatives.

One is to close the mills that are in operation. The second is to call tenders for the mills that are continuing to operate in the hope that private enterprise will offer a satisfactory price for them and keep them open to the satisfaction of the flax growers and workers in the districts concerned.

If we wish to keep the mills open as a government concern, we know that there will be heavy losses. We have to decide, therefore, whether we should close them within the next three years after taking into consideration the amount of flax that is being grown. The current flax crop is now being harvested and we have to decide whether the factories in each centre should be given an opportunity to clean up the stocks that are available and extract the fibre, or whether we should close the mills at once. I believe that the period of three years before the mills will be closed will be a testing period for those who are interested in flax production. They will have an opportunity to put a proposition to the Government that they are prepared to take over the mills as individuals or cooperative organizations. If they take them over, they will be in a position to continue to grow and produce flax fibre for Australian consumption. We have been informed that the production of flax fibre is insufficient to meet the demand and we have to import some flax. The amount paid by way of bounty on flax fibre in the past three years and the production each year were -

Production of flax has been decreasing over the past three years. I believe that if private enterprise is given an opportunity to buy the mills and there is a guarantee that the bounty will be continued, it will be possible to maintain the industry successfully. This bill provides that the bounty will be paid for the next three years. The Flax Commission has recommended that the matter be placed before the Tariff Board at the end of that period. A decision will be reached then whether the bounty should be paid in the future. Therefore, ir is reasonable to expect that if the growers take over the mills, they will be assured of getting the sympathy of the Tariff Board at the end of three years.

I believe that if they buy the mills and install modern machinery, they will be able, with the aid of the bounty, to compete with overseas flax. I have been informed that the Blackwood Flax Co-operative is quite happy about the position. It recently installed a new scutching machine, and the organization believes that it will be able to sell all its product in Australia at competitive prices and on an economic basis with the aid of the bounty.

Senator O’FLAHERTY:
SOUTH AUSTRALIA · ALP

– Where is the Western Australian flax sold?

Senator SCOTT:

– The flax fibre is extracted at the mills and the line fibre is sold to spinners in the eastern States.

Senator O’FLAHERTY:
SOUTH AUSTRALIA · ALP

– The fibre has to be transported across Australia.

Senator SCOTT:

– That is true, but approximately 10 to 12 tons of flax straw is required to yield 1 ton of fibre, and the cost of transporting the fibre produced from that quantity of straw is not excessive. It can be shipped to the eastern States for approximately £8 a ton.

Senator O’Byrne:

– Who is the main consumer of flax fibre?

Senator SCOTT:

– Flax is manufactured into numerous articles and there are consumers throughout Australia. After World War II. much of it was sold to buyers in England. There is a big demand for flax in Australia. In fact, it is necessary to import flax fibre, because we are not growing sufficient to satisfy the demand.

The Blackwood Flax Co-operative has gone about the production of flax in a businesslike way. Following the advent of new varieties of flax and the introduction of new types of machinery, it finds that, with more co-operation between the growers and the Department of Agriculture, it can grow a better product. Originally, flax was harvested with a reaper and binder, put into sheaves and, after it had dried out, was taken to the mill. But nowadays different kinds of machines are used for harvesting. In Western Australia, farmers are using a flax-pulling machine which takes a cut of 4 or 5 feet and pulls the whole of the flax plant instead of leaving, as in the days of the reaper and binder, 4 or 5 inches still in the ground. By using that method, the production of line fibre has risen by between 25 per cent, and 30 per cent.

Senator O’Byrne:

– It pulls roots and all?

Senator SCOTT:

– Yes. I believe that, with the use of modern machinery and the assistance of officers of the Department of Agriculture, flax-growing in Australia can be made a success. In the higher rainfall areas of the Commonwealth, farmers are looking for a suitable rotational crop. A paddock that, is sown with subterranean clover becomes clover sick after four or five, or perhaps six or seven, years; there is then too much nitrogen in the soil for the clover to be grown successfully. The result is that farmers find that their paddocks go back to coke weed and other kinds of weed that are not very profitable. Therefore, they look for rotational crops that will take the nitrogen out of the soil so that they may again sow the grasses or clovers that do so well in the heavier rainfall areas. It has been proved by the Department of Agriculture in Western Australia and by the farmers concerned that, if they grow a crop of flax or cereals once in every five or six years, their fields are in much better condition and that they can carry many more stock than they would be able to carry without the growing of a rotational crop. I am firmly convinced that the growing of flax as a rotational crop not only is economically sound from the farmers’ viewpoint but also is of considerable assistance to the Australian consumer.

For all the flax mills throughout the Commonwealth to close down would be a tragedy. I sincerely hope that within the next year or so the growers of flax, seeing they know that the Government has decided to vacate the industry and has given the Flax Commission, which is the owner of the mills, three years within which to wind up, will purchase the mills either as co-operatives or individuals and produce the quantity of flax that is readily saleable in this country.

The production of flax fibre has its problems. The growers should have an assurance from the Government that the fibre they produce will be sold on the Australian market. I feel that, if the Govern-‘ ment were to give that assurance, the flaxgrowers would be only too pleased to carry on. I understand that in Western Australia at the present time 400 tons of flax are waiting to be sold. The growers want an assurance, and justly so, from the Government that buyers in the eastern States will not be permitted to purchase line fibre from overseas until the total quantity that is produced in Australia is used.

Senator Pearson:

– How much are we importing a year?

Senator SCOTT:

– We are importing between 1,000 and 1,500 tons of line fibre a year; it varies from year to year according to the quantity that is produced in Australia. If the manufacturers can obtain fibre from overseas, apparently they will do so; and that is a source of worry to the flax co-operative in Western Australia. I understand that the demand on the world’s markets for flax fibre has fallen over the lastfew months. Probably that is why we in Western Australia have not been able to sell what we have grown. I repeat that there should be some assurance from the Government that the fibre that is grown inAustralia will not be allowed to accumulate but will be used by Australian spinners before they are allowed to import fibre from overseas. 1 congratulate the Government upon its decision to pay a bounty for the next three years and, because of the excessive cost to the Australian taxpayers, to vacate the industry. I sincerely hope that those people who are now growing flax will get together and purchase the mills concerned so that the Australian industry will not fail.

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– in reply - I thank the Senate for the reception it has given to the bill. I wish to reply to only one or two points that have been raised. Senator Kennelly was concerned about why a bounty would be needed in two or three years’ time, but I think that matter was fairly well dealt with by Senator Scott. The Blackwood Flax Cooperative in Western Australia is very enthusiastic about its future. It is re-equipping with new machinery and I believe that, with assistance from the Western Australian Government, it will be able to carry on.

We are hoping that private enterprise will be interested in the mills at Mount Gambier and Strathkellar. Both mills are in areas where there is a sufficient fall of rain to make the prospects at least reasonable. It is hoped that flax production will continue in those three areas. This year, 1,216 tons of flax fibre has been imported. So there is quite a difference between the amount that we produce and what we use, and for that reason I feel that there is some future for the industry. The Government, in view of the report of the departmental committee, believes that it is time that private enterprise was allowed to conduct the mills that can continue economically.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 1713

NATIONAL HEALTH BILL 1957

Second Reading

Debate resumed from 3rd December (vide page 1649), on motion by Senator Cooper -

That the bill be now read a second time.

Senator ASHLEY:
New South Wales

– The Opposition is not opposing this bill, although it is opposed to the principle upon which the additional hospital benefit is based. The purpose of the bill is to increase the additional hospital benefit payment from 4s. a day to 12s., an increase of 8s. The Opposition is of the opinion that the granting of this increase in the additional benefit has been too long delayed and that, in view of the increase in hospital costs to-day, from the point of view of both the hospital and the patient, the increase is not sufficient. At the present time, the Commonwealth hospital benefit is 8s. a day and the additional benefit is 4s. As I have said, this measure proposes to increase the additional benefit to 12s.

The bill, however, inflicts upon the patient or contributor a form of coercion, in that he must be in a hospital fund in order to collect the additional benefit. Contributors who are contributing on a lower scale will have to contribute on a higher scale and pay a higher weekly rate in order to become eligible for the additional benefit. In ‘effect, there will be an increased contribution charge. The Minister in his second-reading speech said that it will amount to only ls. 6d. a week.

I have on many occasions in the Senate expressed my view of the manipulation of funds that have been collected for the purpose of providing a real national health scheme. I direct attention to the fact that on 12th September, 1945, the Social Services Contribution Bill was introduced by resolution, providing that social service contributions be imposed on a graduated scale ranging from 1 .Id. in the £1 on an income of £105 to ls. 6d. in the £1 as the maximum rate payable. From 1948-49 until 1952-53 the amounts so collected were paid into the National Welfare Fund. At the end of the financial year 1952-53 the balance in that fund amounted to £186,836,000. I should like the Senate to remember that figure.

The pay-roll tax has been discussed frequently in this chamber from the point of view of the social service for which it is imposed, its impact on industry and its effect on the cost of living. The pay-roll tax was imposed in 1941 in order to provide a portion of the finance for child endowment. Both the pay-roll tax and the social services contribution tax collections were paid into the National Welfare Fund. In the year 1948-49 the contribution from Consolidated Revenue was £110,058,000. In 1949-50 the contribution was £123,288,000; in 1950-51, £132,680,000; in 1951-52, £171,709,000 and in 1952-53, £165,511,000. The expenditure in 1948-49 amounted to £80,777,000; in 1949-50, to £92,804,000; in 1950-51. to £114,983,000; in 1951-52 to £137,608,000 and in 1952-53, to £165,511,000. I cite those figures to show that those amounts were paid into the National Welfare Fund. The Minister, in reply to a question that I asked, stated that at present the amount in the fund is in the vicinity of £190,000,000.

It is true that in 1951 the Government brought the social services contribution under the general heading of income tax and granted an insignificant reduction in overall taxation. For the single man without dependants on the’ basic wage of £13 10s. in New South Wales - the most populous State - the social services contribution has remained since 1946-47 at £52 10s. per annum. In 1949-50 his social services contribution amounted to £52 10s., and his income tax liability to £19 - a total of £71 10s. When the two taxes were merged in 1950-51 his overall tax was reduced by 30s. per annum, or 7d. a week - an insignificant sum. To-day, the same taxpayer pays in all, £53 10s., so it will be seen that he still contributes to social services as much as he did in 1946-47.

We object most of all to the fact that, after paying this huge sum annually, he does not qualify for free medical or hospital attention. He must still join a medical fund and pay for full coverage, ls. 6d. a week, before he will get any medical benefits at all. To receive the proposed additional hospital benefit of 8s. a week while in- ill health, he must pay ls. 6d. a week all the year round. I should like the Minister, when replying, to tell me how much a single person, without dependants and on the basic wage, will have to contribute in order to receive the additional benefit proposed by the Government.

I have directed attention to the fact that in 1953, there was a balance in the National Welfare Fund of £186,000,000. These revenues, though collected for a specific purpose - the provision of social services - have been manipulated. Pay-roll tax was imposed by a Liberal-Australian Country party government to help finance child endowment. At page 779 of the “ Yearbook “ for 1956 we find the following comment in relation to the National Welfare Fund, into which these taxes were paid -

The National Welfare Fund was established for the purpose of providing a fund for the payment of Commonwealth social services benefits. During the year 1949-50 an amount equivalent to the total collections of pay-roll tax and social services contribution was paid to the fund from Consolidated Revenue. During 1950-51 the social service contribution was amalgamated with the normal income tax and it became necessary to base the contributions on another formula.

This is where the manipulation took place. The Government decided to alter the formula provided in the legislation, under which the whole of the proceeds of the pay-roll tax, and also social services contributions, were paid into the National Welfare Fund. When £186,000,000 had been accumulated the Government stampeded. It thought, “ There is too much money here. It will provide completely free hospitalization and medical benefits, and substantially meet the cost of specialist services “. That had been the intention of the Labour government, which had attempted to introduce a real national health scheme.

Senator Mattner:

– You have said that there was £130,000,000 in the fund when you left office but, in fact, there was not Id. in it.

Senator ASHLEY:

– If the honorable senator wishes me to do so I will go further into this matter of manipulation. My complaint is that revenue collected for the specific purpose of providing social services has been manipulated and used for other purposes.

Senator Mattner:

– By your government!

Senator ASHLEY:

– No. It was paid into the National Welfare Fund and was intact when we went out of office. Naturally, it had to be invested. It was not kept in a safe or in the pocket of the Prime Minister!

Senator Mattner:

– You cannot spend it and have it too.

Senator ASHLEY:

– I see nothing wrong in the investment of excess funds. During the war man-power and materials were in short supply and the Labour government of the day enjoyed surplus revenues. How>ever, the present Government has directed into other avenues revenue collected for the purpose of providing social services. T challenge the Government to deny that there is a surplus of more than £300,000,000 from social services contributions alone - though, naturally, it is smothered up in the general income tax. Social services revenue, when added to the sum of £186,000,000 already available, gives us a total of £315,000,000. That money is now being loaned to the States at 3$ per cent, and 5 per cent, interest. Certainly, the Australian Labour party does not oppose the increasing of benefits. I imagine that no State in the Commonwealth has escaped the financial worry of heavy hospital charges and the rise in costs. This is all associated with the inflation that has ruled in this country as a result of the maladministration of the Menzies-Fadden Administration. There is no denying that fact. One of the worst features of the national health plan is the neglect of the Government to make any provision for people suffering from chronic illness - the people who are most in need of medical attention. The hospital and medical benefits funds do not provide benefits for such people, but the Government is making the payment of this additional hospital benefit contingent upon a person joining a hospital benefit fund.

I point out to the Senate that the organization that will benefit most from this legislation is the Hospitals Contribution Fund of New South Wales, which has more contributors than all the other friendly societies and similar organizations combined. It has a revenue to-day of approximately £4,000,000, built up over a short period, chiefly since 1952. In the 1956 balance-sheet of this fund details of expenditure on administration are given. Expenditure on audit, medical, legal and professional services was £121,677. Office expenses, equipment hire, maintenance and depreciation amounted to £10,775. Postage, printing, stationery and telephone expenses were £30,930. Salaries and commissions were £99,213. These salaries and commissions were paid chiefly to chemists for enrolling members. The balance-sheet also shows branch expenses as £2,380 and salaries, travelling expenses and commissions as £32,013. The total administrative cost amounted to between £320,000 and £325,000.

The turnover in 1956 was £3,792,333. In 1952, when the government’s health scheme, which is so beneficial to this organization and to the medical profession, was introduced, the turnover was £671,000. It has increased to the enormous figure I have just mentioned. As a matter of fact, this is the fund which will get almost all the benefit from the compulsion, the coercion, of people to join a fund so as to get the increased hospital benefit.

The organization has built up enormous revenues and has operated to the detriment of other hospital organizations, friendly societies and medical benefit funds that have catered for the people for over a century. This fund, like the Medical Benefits Fund of Australia, refuses benefits to people, no matter how long they have been members, if there is any suspicion that at the time they joined the fund they had symptoms of the disability in respect of which they are claiming. The Government should try to do something to right that injustice. Dozens of cases have been brought before me of the refusal of benefit in such instances. I want to be fair, and I point out that many of the cases were adjusted after representations had been made on behalf of the people concerned, but I wonder what happens in the case of people who do not have representations made for them. I do not want to labour the matter to-night, but I say that among the chief beneficiaries of the Government’s national health scheme are members of the medical profession and chemists.

I want to say now that the Labour party believes in having a national health scheme, and will endeavour to improve and extend the scheme when it is returned to office. I point out again that under the Government’s scheme people are coerced into joining hospital and medical benefits funds because otherwise they would not receive the Commonwealth benefit, despite the fact that they have been paying taxes from the receipt of which such benefits are paid - in the case of those old enough, since 1946. They are compelled to join a fund and pay an additional ls. 6d. a week on top of the taxes they pay and have paid. In the case of the people I mentioned earlier, they have been paying £52 10s. a year.

The Labour party will attempt to redraft and improve the conditions of the scheme. We will provide dental care, which is not provided under this Government’s scheme. The present scheme is the dearest scheme in the world and provides the least benefits of any scheme in the world. We will provide for the dental care of children under sixteen years of age, as was stated when this matter was before the Senate on a previous occasion, and in another place. We will also address ourselves to the provision of medical training and research facilities and a system of regional hospitals. We will provide for substantially increased rates of hospital benefits, having regard to the rise in hospital costs. We will move for the negotiation of fresh agreements between the Commonwealth and the States to ensure that throughout Australia there shall be no charge and no means test for qualified patients occupying beds in public wards of public hospitals. We shall provide that the payment of Commonwealth hospital and medical benefits shall not be conditional upon a patient’s being a contributor to a hospital or medical benefits fund. We say these people have paid their way in taxes. We shall provide that registered organizations shall be subsidized to ensure that their benefits will be extended to chronic sufferers and those suffering disabilities at the commencement of their membership of registered organizations. We shall set out to devise, in consultation with the medical profession and State governments, machinery to stabilize medical charges and to determine just variations of those charges. We shall provide that medical benefits will be extended to mileage charges of medical practitioners incurred by patients, especially those in outback areas. We shall provide that the provision of medical and hospital benefits shall be financed from revenue raised on a graduated scale based upon the capacity to pay. Finally, we shall undertake the care and relief of mental illness.

I think you, Mr. Acting President, will agree that from these huge sums which have been collected ample provision should also be made for the aged and the maimed. Some attempt will be made by the Labour government to ensure that ample provision is made for those people. I hope that the Minister will give some explanation of why the huge sums of money which have been raised have been diverted from the purposes for which they were collected, and also of the manner in which that money is being used to-day.

Senator ANDERSON:
New South Wales

– 1 wish to speak on this National Health Bill in a more specific way than did Senator Ashley. I suggest that much of what he has said might more reasonably have been said during the debate on the Budget. He spoke, so to speak, on a fairly wide front, but he made an attack on the Hospitals Contribution Fund of New South Wales. I say to him in all seriousness that he made very wrong and silly statements. After all, this is not a profit-making organization. The Hospitals Contribution Fund of New South Wales, to which he referred specifically and the last financial statement of which I hold in my hand, is controlled by representatives of the constituent hospitals in the County of Cumberland in the State of New South Wales. It is designed for no other purpose than to provide funds for people who enter hospitals. I note with interest that the representative of the Eastern Suburbs Hospital is none other than the Honorable Morrie O’sullivan,

M.L.A., who until a short time ago was Minister for Health in the New South Wales Labour Government.

The Hospitals Contribution Fund provides, more or less co-operatively, a method whereby money is made available to contributors to help them to pay hospital fees. If the fund makes a profit, it is for no other purpose than to enable it at some time to give increased benefits to its contributors. There is nothing else that the fund can do with the profits, lt is there for all of the contributors. The only purpose for which money can be drawn from the fund is the payment of benefits to contributors who are admitted to hospital. When the honorable senator suggests that the fund is an octopus drawing away from the people their well-earned income, he talks with complete disregard of the facts. When one studies the balance-sheet with any degree of intelligence, one finds that in relation to revenue the cost of administration is very low.

Senator Aylett:

– It has £4,000,000 a year revenue.

Senator ANDERSON:

– £4,000,000 is a lot of money. I suggest that the honorable senator keep quiet for a moment. One must realize that the contributors pay their contributions in sums of 2s., ls. 6d. or 6d. That entails a great deal of work. In addition, there is the task of paying out money in accordance with the various claims for hospital benefits. It is a sorry day when such a magnificent fund, which was created to help hospital administration in New South Wales and for many years paid back its profits to the various hospitals, comes under such an attack as we have just heard.

The bill has for its purpose the payment of the additional Commonwealth hospital benefit. Revenue will be required to provide an additional £3,000,000. At present, the Commonwealth benefit is 8s. a day, and a contributor to a hospital benefit fund receives an additional 4s. a day. The combined benefit is 12s. a day if the patient is a contributor to a fund, and 8s. a day if he is not. Because the problem is fairly complex and there are three or four different ingredients, I want to take some specific cases and place them on record, so that we can see exactly what Common wealth benefits and fund benefits are paid, and link them to the cost of hospital administration.

Let us examine the case of patient X, who contributes to a fund which pays him a benefit of 16s. a day. He contributes ls. 6d. a week under a family rate scheme. He receives the Commonwealth benefit of 8s. a day, plus the additional Commonwealth benefit of 12s. a day, making a total of £1 a day in Commonwealth benefits. I shall return later to a consideration of this patient. Patient Y, who also contributes to a fund, but not to the extent of providing for a payment of 16s. a day, receives 8s. a day in Commonwealth benefit plus 4s. a day additional Commonwealth benefit, making a total of 12s. in Commonwealth benefits. Patient Z, who does not contribute to a fund, receives 8s. a day in Commonwealth benefit.

Now let us return to patient X, who receives a Commonwealth benefit of £1 a day. He is a contributor to a fund on the scale which entitles him to 16s. a day. Thus, his hospital expenses are covered to the extent of £1 16s. a day, or £12 12s. a week. Patient Y receives a total Commonwealth benefit of 12s. a day. His contribution to a fund at the family rate of 6d. a week would return him an extra 6s. a day. In all, he would receive 18s. a day, or £6 6s. a week towards his hospital bill.

Let me here interpose patient Y1, who contributes to a fund on a scale returning him less than 16s. a day. He receives a Commonwealth benefit of 12s. a day. If he is contributing to a fund at the family rate of ls. a week, he receives 12s. a day from the fund, making 24s. a day. He receives £8 8s. a week to meet his hospital account. Patient Z, who does not contribute to a fund, receives only a Commonwealth benefit of 8s. a day, or £2 16s. a week.

I want to examine these hypothetical cases in relation to hospital charges. I shall cite only New South Wales public hospitals, because I happen to be a director of a fairly large Sydney hospital, and I know exactly what the charges are. They are laid down by the State Government. For the public ward, the charge is £12 12s. a week, and for the intermediate ward £18 18s. a week.

Senator Ashley:

– How many are accommodated in the public wards?

Senator ANDERSON:

– Do not distract me with that issue. That is not the question with which I am dealing. Patient X, in hospital for one week, is charged £12 12s. for public ward accommodation, and receives £12 12s. in Commonwealth and fund benefits. Patient Y, in hospital for one week, is charged £12 12s. for public ward accommodation and receives £6 6s. in Commonwealth and fund benefits, and so has to pay £6 6s. out of his own pocket. Patient Y1, in hospital for one week, is charged £12 12s. for public ward accommodation. He receives £8 8s. in Commonwealth and fund benefits, and therefore has to pay £4 4s. a week from his own pocket. Finally, patient Z is charged £12 12s. for one week in a public ward. Not being a contributor to a fund, he receives only 8s. a day, or £2 16s. a week, in Commonwealth benefit, and therefore has to find £9 16s. a week. To complete the picture, I point out that a pensioner is admitted to hospital without cost to himself. This means that the hospital has to debit its accounts to the extent of £12 12s. a week for which it can recover 8s. a day by way of Commonwealth benefit. lt will be seen, therefore, that the hospital incurs a loss of £9 16s. a week on this pensioner service. All that makes the factual background against which I wish to make some observations and to state my experience of hospital administration. The charge fixed by the State Government of £12 12s. a week for a public ward bed and £18 18s. a week for an intermediate ward bed has no relation whatsoever to bed costs. I think even Senator Ashley knows that the cost of hospital administration has increased. It is true that the terms and conditions under which people work in hospitals have increased vastly also.

Senator Ashley:

– So they should!

Senator ANDERSON:

– It is only proper that they should. I do not deny that, but 1 do suggest that factors such as that have had a considerable bearing on the cost of hospital administration. For instance, the nursing staff does not now do the jobs it did in our mother’s day and in our grandmother’s day. This means that additional staff, such as nursing aids, hospital wardsmen, and other employees not envisaged in the early days, must be employed.

The fact is that in New South Wales the actual bed cost is between £24 and £30 aweek. I suggest that if any honorable/ senator cares to examine the balance sheets of most of the suburban and inner city hospitals of New South Wales he will find that the cost of a hospital bed fluctuatesbetween £24 and £30 a week. It will be appreciated, therefore, that the StateGovernment is called upon to contribute heavily from consolidated revenue to keep the hospitals going. I make that point lest it should be imagined by some that this hospital benefits scheme was intended to provide all the finance required for the administration of hospitals. Quite obviously, it does not. The States, from their consolidated revenue, into which is paid” moneys obtained under the agreement: between the Commonwealth and States, provide millions of pounds towards the cost of hospital upkeep.

To illustrate my point, 1 mention the hospital in which I am interested. It has. approximately 200 beds and it provides public, intermediate, midwifery and all theother normal services of a hospital. To the revenue that the hospital receives by way of fees and from the Commonwealth benefit, the State Government has to’ con-tribute approximately £140,000 a year.. Honorable senators will appreciate, therefore, that hospital administration is a most difficult and complex matter.

That brings me back to the point that the basic contribution of 8s. a day was fixed at a time when the average weekly cost of a hospital bed was of the order of £12 12s. I have already stated that the average cost to-day is double that figure; it is about £24 a week. So we have a situation that whereas, when the contribution was 6s. a day, the average cost of maintaining a hospital bed was £12 12s. a week, now, when the basic contribution is 8s. a day, the average weekly cost of a hospital bed1 isabout £24. I suggest that under those circumstances the basic figure could well-‘ be improved upon. I emphasize that, in saying that, I am not opposing this bill; I merely make the point that this basic figure needs prompt adjustment.

Senator Ashley:

– We are in agreement there.

Senator ANDERSON:

– I did not think it would be long before Senator Ashley and I would be in agreement. The Commonwealth’s contribution of 8s. a day is deducted from the hospital account by the hospital, which makes a return to the State government and claims accordingly. The additional Commonwealth benefit, which is at present 4s., is paid to the patient on production of proof that he is a qualified member of a hospital benefits fund. I earnestly suggest to the Government that this system makes for very heavy administrative costs in hospital management which automatically boosts the bed costs of a hospital. It would be more logical to treat the additional benefit, which is at present 4s., and which is to be increased to 12s., in precisely the same way as the basic contribution of 8s. a day is treated; that is to say, when a ‘ person goes to hospital, this extra benefit should be deducted at the source, as it were. If this were done, it would relieve the hospital administration of a considerable amount of work which, in turn, would have its effect upon bed costs.

The underlying purpose of this bill is to induce people to join a hospitals contribution fund. The 1952 act, which was introduced by Sir Earle Page, has been the means of inducing something like 62 per cent. of the population to join a hospitals contribution fund. That in itself is some measure of the success of the scheme. After all, people like to have security. They like to feel that they are pulling their weight, that they are members of an insurance scheme under which they receive moneys to meet their hospital expenses. As I -have said, approximately 62 per cent, of the people are members of a hospitals contribution fund to-day.

The point I make is that the original scheme was designed to give people an incentive to join a fund. This bill follows the same principles as those contained in the 1952 act in that it proposes to make the inducement more attractive. If I could state the position in a single sentence, I should say that the more one insures oneself the greater the government contribution one will receive.

I regret that under this measure it is proposed to abolish one inducement. At the moment, any person who is being admitted to a hospital can, at the point of admission, join a fund and immediately qualify for the extra 4s. a day. That inducement was deliberately included in the previous act to encourage people to join a fund, and experience has shown that once people join a fund they continue to remain in it. Quite clearly, under the present act, there is an inducement to people to join a fund because, immediately upon entering hospital, they qualify for the extra 4s. a day or 28s. a week deduction from the hospital bill. This measure seeks to abolish that inducement.

I have stated that a person could join a fund upon entering the hospital and qualify immediately for the extra 4s. a day. Let me modify that by stating that, obviously, the person would not qualify for the hospitals contribution fund benefit because at present it is necessary to be a member of the fund for something like two months before qualifying for that payment. Under the new proposal, a person must be a member of a fund for two months before qualifying for the extra Commonwealth benefit, just as he must be in it for two months to qualify for the hospital contribution fund benefit. In view of past experience, it would have been reasonable and logical to have left the matter where it was. Many people are not in a hospital benefits fund because they have never been sick and they do not contemplate falling ill. Once they have an illness, they realize the necessity to be in a hospital benefits fund and then, having joined, they know that they were silly to have refrained from joining before. Once they are members, they remain in the fund and they get the benefit if they fall sick again.

It is a pity the provision to which 1 referred has been eliminated because the situation would be perfect if everybody contributed to a fund. From the point of view of hospital administration, the hospital contribution funds have helped considerably in the collection of hospital accounts. That has assisted the finances of hospitals considerably. If every person contributed ls. 6d. a week to a hospital benefits fund, he would qualify for a benefit of £12 12s. a week. That is the present standard rate for admission to a public ward in New South Wales.

Senator Ashley:

– If the patient can get a bed.

Senator ANDERSON:

– That is an entirely different problem. It is not related to this bill.

Senator Ashley:

– Why cite the benefits if they are not available?

Senator ANDERSON:

– Every hospital in Sydney has a certain proportion of public and intermediate wards. The big hospitals generally are open all the time, and they are doing the best they can. It is true that there is a waiting list at all big hospitals, but that matter could be raised more appropriately on another occasion. The problem of chronic patients is another matter that could be discussed separately.

Senator Ashley:

– What about the intermediate wards at £18 18s. a week?

Senator ANDERSON:

– Some people want to go into an intermediate block and by contribution under table 4B and paying a family rate of 4s. a week, they would qualify under the new arrangement for a benefit of £18 18s. which would pay for treatment in an intermediate ward. I I believe that is very desirable and a good provision. If it encourages more persons to join a hospital benefits fund, I am all in favor of it. The schedules of contribution provide for table IB at ls. a week and table 2B at 2s. a week family rate. I suggest that there should be a new table providing for the payment of 1 s. 6d. a week which would cover the requirements of this bill and enable contributors to receive a benefit of £12 12s. a week. That would cover costs in a public ward and would cater specifically for persons who are satisfied with public ward accommodation.

The second reading speech of the Minister for Repatriation (Senator Cooper) contains a reference to chest hospitals. Therefore, I am able to make observations on chest hospitals generally and the agreement between the Commonwealth and the States for the treatment of tuberculosis. The Minister referred to the fact that, in addition to general hospitals, there are repatriation and other hospitals, and he said that the Commonwealth Government was making substantial contributions to capital expenditure throughout Australia for chest hospitals. That is good and, in one respect, I hope that that expenditure will be continued because the hospitals so constructed will never be wasted. If they are no longer required as chest hospitals, they can be converted readily into general hospitals.

However, I remind the Senate that we have achieved magnificent results in Australia in seeking to eradicate tuberculosis because of the efforts of medical and lay people, efficient diagnosis and treatment of the disease. As a result, there has been a substantial fall in the incidence of tuberculosis. I believe that the time will soon come when we shall have to re-examine the agreement between the Commonwealth and the States in this connexion because of the wonderful advances that have been made.

Recently, a big chest hospital at Waterfall, near Sydney, was closed because it was no longer required for the treatment of tuberculosis. It seems odd to me, therefore, that we should continue to provide money for chest hospitals when they are not needed. I believe that the money could be diverted to other types of hospitals to better advantage. This capital expenditure could be diverted to hospitals for chronic patients, or to maternity hospitals which are always overcrowded. I would favour the diversion of the money for capital works to any form of hospital except one for the treatment of tuberculosis when obviously we have made such an impact on the disease that chest hospitals will not be so sorely needed in future.

I shall crystallize my opinions in this way: In this bill, we have a proposition to increase the Commonwealth contribution to hospital benefits. That will assist the person who is contributing for a certain basic unit in a hospital benefits fund, and it will enable hospital administration to work more smoothly. I assure honorable senators that those who manage hospitals have a difficult task. The State governments are faced with big problems also because they have to contribute large sums from their revenue to hospitals. Therefore, the bill provides for substantial financial help for hospitals generally.

I congratulate the Government on this measure. It will encourage people to join a hospital benefits fund. As a humble hospital administrator, I believe the situation would be perfect if we had everybody in a fund except indigent persons who are able to obtain hospital treatment free of cost. I look forward to the day when everybody, and not only 62 per cent, of the people, will be contributing to hospital benefits funds.

Senator COOKE:
Western Australia

– I listened with interest to Senator Anderson’s contribution to the debate. It is quite obvious that the honorable senator has had a lot of experience in hospital administration and an association with the various medical benefit funds that have been established under similar legislation to that which is now before us. I was particularly interested in Senator Anderson’s statement that he looked forward to the day when not 62 per cent, of the people would be contributors to hospital benefit funds but 100 per cent, of the community would be in that position. Let me remind him that, if Labour had remained in office, 100 per cent, of the people of Australia would have been entitled to hospital and medical benefits without there being any surcharge for hospital benefit schemes and all the rest of it.

Senator Anderson made a comparison between the maximum benefit that is payable to a member of a hospital benefits fund and the minimum charge for hospitalization, but the people who are listening to the broadcast of these proceedings and who have suffered from illness will know that his comparison does not ring true.

To get a bed in a public ward in any State is exceedingly difficult. The people who are in greatest need of assistance in time of sickness cannot afford to carry the burden of contributing to the scheme that is envisaged in the measure now before us. When Labour went out of office, the amount standing to credit in the National Welfare Fund was £186,000,000. Admittedly, the fund is frozen and is still earning interest, but this Government performed the greatest confidence trick of all time when it amalgamated the social service contributions and income tax payments and paid the lot into Consolidated Revenue. The revenue of this Government now amounts to £1,331.900,000, but proportionately the Government is not paying any more by way of hospital benefits than formerly.

Let us analyse what happens in the administration of these hospital benefit funds. Senator Aylett has elicited the information, in reply to a question, that in 1955-56 registered hospital benefit fund organizations collected from contributors £15,286,436 but distributed in the form of benefits only £11,062,554, leaving a residue of £4,223,872 for administration and other reserve costs. Those contributions constitute a fairly heavy impost on the contributors in addition to what they contribute by way of taxation for the provision of social service benefits. A person who suffers from a chronic illness is not properly covered by the scheme we are now considering. If he is suffering from a certain complaint before he applies for membership of a hospital benefits organization he must wait for a prescribed time before he can obtain any benefit. There are 101 such restrictions.

Probably the worst thing that this Government has done has been to remove certain pensioners from entitlement to free medicine and hospital treatment. It is they, above all others, who need some kind of security in regard to medical treatment and hospitalization. Another matter that has not been made much of during this debate is that this Government has continually told us that it considers the family man, that he is the salt of the community. I agree that he is, but it seems that in practice the Government really does not believe he is. I have received a letter from the lodge to which I belong stating that an increase of 13s. per unit for the member with dependants and 6s. 6d. per unit for single members will be necessary to permit the additional government benefit to be received. I can afford to pay it, but not every one else can. A man who, because of his income and family responsibilities, was not taxed when Labour was in office, is now up for an extra 13s. a unit. Many of these people who are on low incomes just cannot afford that impost. The burden again falls on the poorer section of the community - the family man. If a person cannot afford to pay, the Government will not further subsidize him; but the man who has plenty of money and is not in the category of the ordinary family man has no worry about hospital treatment. The scheme we are now considering does not provide reasonable protection for the family man.

The Government talks freely about beds in public wards, but they are simply not available. A person who is chronically ill would find it very difficult to obtain hospital treatment, even if he were fortunate enough to be a member of a hospital benefits organization. All those matters are not being considered. The present hospital benefit scheme has reached the stage where, to some degree, the position of the medical man has been improved. I do not criticize the members of the medical profession. There are many just- and fine medical men in the community; but their income is now higher than it was earlier, and they have a great independence. Hospitalization has been improved to a degree, but not to the degree to which it should have been improved in view of the huge amount of money that the Government is raising by way of taxation and the amounts that are being taken from the community by approved societies for the purpose of providing hospital benefits. I think the Government is quite wrong in its assessment of the merit of the present scheme and in suggesting that it provides a freedom from worry about ill-health. There is still need for considerable improvement. The Government can afford to pay what should be paid to a citizen who is ill, irrespective of whether he is a member of a hospital benefit fund. Every citizen should receive the maximum payment.

Senator Wade:

– The hospitals do not want that to happen.

Senator COOKE:

– I do not know what the hospitals want, but people should be paid on that basis. I repeat that the person who cannot afford to contribute to such funds receives the least possible assistance. A person who can contribute only to a limited degree receives less assistance from the Government than does the person who is able to pay a bigger contribution. It is not a national scheme in any sense of the word.

Senator Anderson:

– Pensioners do not have to pay at all.

Senator COOKE:

– Some pensioners have to pay. There are two divisions of pensioners since the Government altered the act. There is a division that embraces people who were pensioners before a certain date. Those pensioners receive full hospital and medical benefits but others do not. This division between pensioners is a horrible thing. Some pensioners, who do not qualify for a full pension because they have some means and who become entitled; to pensions after a certain date, do not get free medicine and free hospital treatment.

Senator Anderson:

– I am not talking about free medicine.

Senator COOKE:

– I am. 1 am telling the honorable senator the truth. The present scheme should be altered, because it does not provide those benefits for all pensioners, despite the fact that this Government is collecting in taxation more than the Labour government ever expected would be collected. It is paying the social service contributions directly into Consolidated Revenue and is not putting anything: into reserve in the National Welfare Fund.

The Government’s scheme provides that if a person does not contribute to a friendly society or a hospital benefits fund, he will not receive this subsidized payment, irrespective of his capacity to pay contributions, to a fund.

Senator Anderson:

– The Government does subsidize him.

Senator COOKE:

– He should receive the full subsidy. If he is a member of a fund, he will get more; but if he cannot afford! to contribute to a fund - and incidentally a married man has to pay twice as much as: a single man - the Government pays him as smaller benefit. In effect, the Government’s policy is to penalize the man who has not the ability to pay. That statement is unanswerable.

Another matter to which I wish to refer is the position of people who are members of approved societies, who comply in every way with the Government’s demands in that respect, but still are not receiving full government assistance because they live in isolated areas where they cannot obtain medical treatment from private practitioners. In some of those areas, the State government provides a doctor and subsidizes him. The people in the district have to pay fees to the doctors at the same rate as they would pay if they were living in a metropolis, where there are plenty of doctors and hospital services. In such cases, the Commonwealth will not pay anything, even though the patients are contributing to a fund. In Western Australia this sort of thing is or was happening at Wyndham, Derby, Meekatharra, Broome; Port Hedland, Carnarvon, Wittenoom Gorge and Mount Magnet, although I understand that now a doctor visits Mount Magnet occasionally and that there is a doctor practising at Wittenoom Gorge. These people are the people living in outback areas, over whom the Government has shed so many crocodile tears. They are the pioneers about whom honorable senators opposite talk, but, unfortunately, they have been specifically excluded from entitlement to hospital and medical benefits. I think the position should be corrected. I have here a submission from the United Ancient Order of Druids, which claims that it has a number of members who cannot obtain hospital and medical benefits because they are living in isolated areas. I also have a letter from the Gold-fields Medical Fund, which has members spread throughout the gold-fields of Western Australia. I took the matter up with the Minister for Health in Western Australia, who informed me that he wished that something could be done, but that it was a Commonwealth matter. I then raised the matter with the Commonwealth Health Officer in Western Australia. He admitted that a bad anomaly existed. I referred the matter to the Minister for Health, who replied as follows: -

I refer to your question without notice in the Senate on 20lh March, 1957, relating to the operation of the Medical Benefits Scheme in certain outlying districts of Western Australia where there arc no medical practitioners other than those whose salary is paid by the Western Australian Government.

As the medical services rendered by the doctors in question are charged for by the Medical Department of Western Australia, they come within the scope of section 19 of the National Health Act. This section provides that Commonwealth benefit is not payable where the medical expenses in respect of a professional service are paid or payable to an authority conducting a public hospital. The Act further provides that this restriction does not apply to pathological and radiological services and electroencephalograms.

You will appreciate that a provision of this nature must be uniformly applied throughout the Commonwealth. The Act does not provide any discretionary power. Apart from the provision of Commonwealth benefit for pathological and radiological services and electroencephalograms rendered at a public hospital there is no way, at the moment, whereby approval could be given for the payment of benefits in respect of other medical services in the circumstances outlined by you. . . .

What the letter says, in effect, is that if a person lives in a metropolitan area where he can obtain treatment in a public hospital, his claim for benefits will be recog nized. If he were to go to a private practitioner, he would also be paid. If he lives in one of the north-western towns where a medical practitioner is not available, he must pay the expense of travelling elsewhere to get treatment. If he goes to a government practitioner, he has to pay the full fee to him. There is a doctor in some of these places only because the State subsidizes him. A private practitioner cannot earn enough to induce him to practise in such districts.

People in isolated areas will derive no benefit from this bill, although many of them have contributed to lodges and hospital and medical benefit funds for years. They were probably contributing long before the hospital and medical benefits scheme was introduced. I think this is something to which the Government should give immediate attention. Section 19 of the act should be altered so that the rights of the citizens of these areas will be preserved. If a person can afford to pay the contributions and is prepared to join a society, he should be entitled to receive payment from the Government when he becomes ill and requires attention.

The money that has been taken from the people for the purpose of providing hospital and medical services is not being distributed fairly by the Government. The Government is not giving back in medical and hospital benefits and other social service payments the money collected by the portion of the income tax which represents what was the social services contribution. If that were being done, the present national health scheme would pay a higher dividend to the people. There are not enough hospitals, particularly hospitals that provide beds in public wards, at £12 12s. a week. Despite what has been said by Senator Anderson, beds in public wards are almost unavailable. The majority of hospitals will provide superior accommodation at a charge which is far above the capacity of anybody earning a normal income to pay. Under the present scheme, even if a man were able to pay the maximum contribution to a hospital benefits fund, he would find that the costs of his illness were no more than covered. If he were unfortunate enough to have a recurrence of his illness, or if he needed prolonged hospitalization, he would find that his expenses were not covered. He would not be able to meet them from the benefits he received. The present system is thoroughly wrong and needs an overhaul at a very early date.

The Government should take cognizance of the fact it has a responsibility to contribute more of its huge tax collections towards helping people, instead of demanding that they belong to an approved society before they receive benefits. A man who is married and has a family must make a contribution twice that of a single man if he is to obtain medical benefits. That is surely not sharing the liability to counteract sickness in the community. One finds that those who most need economic assistance during ill health cannot contribute for medical and hospital benefits to the degree demanded by the Government.

Senator Anderson:

– The indigent person is assisted most. He can obtain specialist treatment if necessary.

Senator COOKE:

– But how indigent must he be before he receives that assistance?

Senator Anderson:

– I am referring to the ordinary pensioner.

Senator COOKE:

– Some pensioners are covered. However, I am speaking aBout the family man in industry who is receiving the basic wage and a small margin.

Senator Seward:

– How many men are on the basic wage?

Senator COOKE:

– In this community there are quite a few who would only be too glad to see the colour of the basic wage. We have far too many people receiving sustenance and unemployment relief. How do such people obtain proper assistance when they are ill? Government supporters tend to think that only aged pensioners are indigent. I remind them that many unemployed persons are quite unable to keep up their contributions, and that their position is desperate. It is no use quibbling and asking how many people are actually on the basic wage. I am concerned with the man who is on unemployment relief. He simply cannot afford to continue his contributions to the approved societies. He is then told, “ You are not a member of an approved society and therefore must go back to the minimum rate “. That is the man whose health will break.

I sympathize with honorable senators who are so ignorant of what is going on in the community as not to understand that there are many men on the basic wage, or on lower incomes. Indeed, our unemployment figures are much higher than they should be. 1 invite honorable senators to visit some areas of the Melbourne suburb of Collingwood. They will find there young families whose breadwinner is possibly working in a factory and receiving a very low income. In Western Australia that sort of thing is not so pronounced, but there are plenty of people who, though working, have such heavy family commitments that they certainly cannot, as suggested by the Government, feel free of any worry regarding their health.

As time goes on exploitation in this matter increases. One finds that £4,250,000 remains undistributed by the various medical and hospital benefit societies. I admit that a certain amount of that sum must be devoted to administration, but it is still a very high figure. The Government is paying out these amounts in dribs and drabs. Any individual who can keep up his contributions to an approved society and draw the maximum Government assistance is very fortunate indeed. He is the kind of person who was, under the old lodge system, always able to take care of himself during ill health. It might have been an inconvenience to become sick and need hospital treatment, but he was never faced with any real worry. He is in very much the same position to-day, but the man on the lower rung does not fit so well into the picture that has been painted by the Government. Some honorable senators are far too prone to think only of the man who can afford to pay the maximum contribution and then get into a hospital, taking advantage of the minimum charges. Unfortunately, the unemployed person, or the man on low wages, often cannot be found a bed in an ordinary public ward.

The Government, while conducting this immense scheme, and promising hospital accommodation and treatment to many people, has also a responsibility to develop our hospitals system. It is very easy to say that that is a State responsibility, but health has become a great Commonwealth responsibility also. We have sold it to the people so much that the time is coming when the Federal Government will have to help the States more adequately in the provision of hospitals. The Commonwealth is receiving huge revenues annually and should be prepared to subsidize any body which wishes to provide hospitals. No one will deny that we are not properly served with hospitals. If that is the case in peacetime, how much worse off would we be if there were a nuclear war, and civil defence had to be undertaken? The Government is merely tacking on a few shillings here and there to the money that it returns to the States - hoping to counteract inflation - but it does little to improve the health scheme as a whole.

Senator Anderson referred to the great improvement in the treatment of tuberculosis. Labour can proudly claim that it introduced special grants for hospital treatment of tuberculosis, and allowances for dependants. In those days the grants seemed small and were criticized. I have an idea that it all began in Western Australia as a result of representations by the railways union following a particular case. It all goes to show that if the problem is properly tackled on a national basis certain diseases can be eradicated, or at least kept to a minimum. If tuberculosis sanitoriums and hospitals are not wanted for the purpose for which they were built, they can easily be used for some form of hospital treatment. I assure Senator Anderson that they would be filled very quickly.

I have not had Senator Anderson’s wide experience in these matters, but it seems to me that contractors demand about 300 per cent, more for building a hospital than for building a hotel. I realize that special sanitation, operating theatres and other special services must be provided. However, it has become common now to increase the price of the tender to an unnecessary extent. Very often surgical treatment is not needed, and we should provide hospitals specially for people who are sick and do not need such treatment. Many people merely need convalescent treatment. Such hospitals would not have special provision for surgical treatment, and might thus be built more cheaply. The best policy would be to build as many hospitals of this kind as possible. They should provide the necessary hygiene, but not be loaded with the terrific cost that is normally associated with building modern hospitals where radiological, pathological and surgical treatment is necessary.

The Government has not done anything about these things - or made it possible for the States to do anything about them. The scheme has not been described as being aimed at giving medical attention and service to the people and making available beds in public wards for less than the present figure of £12 12s. a week. The Government must do that if the scheme is to operate effectively.

In common with Senator Ashley, I point out that the Government collects £52 a year from every man, woman and child in the community, in addition to special contributions towards hospital or medical benefits funds, and supplementary taxation. In the circumstances, the health services of this country should be vastly superior to those at present offering, and much less expensive.

Senator MARRIOTT:
TASMANIA · LP

– Mr. Deputy President, I do not wish to waste the time of the Senate as has been done in the last half hour. I ask for leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

page 1725

CHRISTMAS ISLAND (REQUEST AND CONSENT) BILL 1957

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator SPOONER:
Minister for National Development · New South Wales · LP

– I move -

That the bill be now read a second time.

The bill provides that this Parliament request and consent to the enactment of legislation by the United Kingdom Parliament to place Christmas Island under the authority of the Commonwealth of Australia. On 7th June of this year the Minister for External Affairs (Mr. Casey) announced publicly that the United Kingdom Government proposed to transfer to Australian administration this island in the Indian Ocean, which is at present administered by the Government of Singapore. Christmas Island is a small coral limestone island with an area of some 64 square miles. It lies in the eastern Indian Ocean 200 miles south of the western tip of Java and just over half way from Perth to Singapore.

As the Minister pointed out when he made his original announcement, and it should perhaps be emphasized again, this island is not the Christmas Island in the Pacific Ocean where British nuclear tests have been conducted. Indeed, it is separated from that island by more than 4,000 miles of ocean. The Christmas Island with which the bill deals was discovered and named by Captain William Mynors on Christmas Day, 1643. There is an interesting historical connexion between Australia and Christmas Island in that William Dampier was the first man to land on the island. He landed there in 1688, the year in which he made his landing on the west coast of Australia. However, it was not until 1888 that the British Government annexed the island and began to administer it, along with the Straits Settlements, from Singapore.

The main significance of Christmas Island rests on the substantial deposits of phosphate of lime which are found there. A 99-year lease, with the right to extract the phosphate rock, was granted to the Christmas Island Phosphate Company in 1897. In 1949, the lease was transferred to the Australian and New Zealand Governments, which agreed to establish the Christmas Island Phosphate Commission to conduct phosphate extraction operations on their joint behalf. Christmas Island phosphate production in recent years has been about 400,000 tons annually, and from this production a large portion of Australia’s supplies of phosphates is drawn.

The administration of Christmas Island from Singapore, as the seat of government of the Straits Settlements, has been purely a matter of administrative convenience, and Christmas Island has always maintained its status as a separate possession of the Crown. There is no geographical or racial link between Singapore and Christmas Island. With the impending achievement of full internal self-government in Singapore the United Kingdom Government considered that it would be desirable to transfer to Australia and/ or New Zealand the responsibility for administering Christmas Island as the only enterprise on the island is the phosphate industry conducted by the Phosphate Commission, which is the instrument of those governments. After discussions with New Zealand as well as with the United Kingdom authorities it was decided that the best solution, in the interests of all parties, would be to transfer to Australia responsibility for the administration of Christmas Island. I emphasize that this decision was taken with the full agreement and support of the New Zealand Government.

As I have pointed out, Christmas Island, though administered from Singapore, was never made, constitutionally, a part of the colony of Singapore. However, royalties in respect of the phosphate production had been paid over the years to the Government of Singapore. Although this was in the nature of a windfall, rather than an entitlement, it has been thought desirable to make a generous ex gratia payment through the United Kingdom of 20,000,000 Singapore dollars - £A.2,925,000 - to ensure that the Singapore budget will not be adversely affected by suddenly ceasing to receive this revenue. The Australian and New Zealand Governments will each pay immediately to the United Kingdom Treasury half of the amount involved, and will receive reimbursement over the years by means of a levy upon the phosphate produced. I should stress that this will not result in any significant increase in the price of phosphates in Australia as, on the basis of the present and contemplated rate of production of phosphate on the island, the charge which will be imposed upon phosphate produced in order to amortize this payment will not be greater than the royalties which would have been paid if the transfer had not been effected.

Christmas Island has no indigenous inhabitants. Apart from government officials the only people at present on the island are those under contract to the Phosphate Commission. The total population at the beginning of this year was 2,650, of whom about 2,000 were Chinese, 500 Malays and 150 Europeans. The Australian Government has agreed that British subjects normally resident on the island at the time of transfer will be given the option of acquiring Australian citizenship. It is not known at the moment how many of the present inhabitants are, under this agreement, eligible for, or will opt, Australian citizenship. A considerable number of them are not British subjects. Of the British subjects, many are not “ normally resident “ on the island but are temporarily there on short-term contracts with the Phosphate Commission. Of those eligible to opt for Australian citizenship, a considerable number have come from Singapore and will become eligible for Singapore citizenship under the forthcoming citizenship legislation there. It is thought likely that most of these people will seek Singapore rather than Australian citizenship. The provisions in respect of citizenship are, in fact, the same as those made in the case of the Cocos Islands.

From Australia’s point of view, the transfer of Christmas Island to our administration will help to ensure the availability of continued supplies of phosphate for use in our own and New Zealand’s primary industries. Honorable senators will not need to be reminded of the importance to us of a continued and reliable supply of phosphates.

The manner in which the transfer of the island to Australian administration is to be effected has been the subject of careful consideration by the legal officers of all interested governments. Before the end of this year, the United Kingdom Government will, by Order-in-Council, detach the island from the administration of the Government of Singapore. Subsequently, the United Kingdom Parliament will enact such legislation as may be necessary to place the island under the authority of the Commonwealth. Before the United Kingdom Parliament can legislate to this end, it will be necessary for this Parliament to request and consent to the enactment of such legislation. This is the same procedure as was employed in the case of Cocos Islands. The purpose of the bill now before honorable senators is to embody such a request and consent thereby allowing the legislative machinery of the United Kingdom to operate. The final stage in the legislative process will be the passage by this Parliament, of a bill, which will be presented at the appropriate time by my colleague, the Minister for Territories, accepting the transfer and providing for the future administration of the island.

In conclusion, I would like to express my appreciation of the helpful and co-operative attitude of the United Kingdom Government, as well as of the Government of Singapore throughout all the discussions and negotiations which have been held on this subject.

Debate (on motion by Senator Kennelly) adjourned.

page 1727

SUPERANNUATION BILL 1957

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator SPOONER:
Minister for National Development · New South Wales · LP

– I move-

That the bill be now read a second time. Eligibility for superannuation pension is, under the Commonwealth Superannuation Scheme, related to the salary of the contributor. As the salary increases, so too, does the entitlement to contribute for a higher pension on retirement, up to the limit of salary at which the maximum pension is reached. Pensions have been maintained at a reasonable level for existing contributors to the Superannuation Fund, and also for those who have retired in recent years because there have been substantial increases in overall salaries which, as I have explained, have been accompanied by increased entitlement. These pensioners, in company with others, have also benefited from the increases in the value of each unit of pension which occurred in 1947, 1951 and 1954.

Pensioners who retired in earlier years are not so fortunately placed, as their pensions are related to salaries that were paid in pre-war days. Whilst it is true that the increases in the value of the units that have been made from time to time have also been extended to the pensions of these people, they have nevertheless been substantially affected by changes in conditions since retirement. This bill provides relief for them by increasing the unit of pension by £13 per annum for all those who retired prior to 14th May, 1942, at which date cost-of-living adjustments were made to the Public Service salaries.

Subsequently, there were similar adjustments of salaries which were also accompanied by additional pension entitlements.

For this reason the increase is reduced upon a sliding scale. At the end of the scale the increase in each unit of pension is £9 2s. per annum and is applicable to those who retired on 5th April, 1947. There were some general increases in salary after that date but the date of effect varied between different groups of contributors. It is proposed, therefore, to extend the increase of £9 2s. per annum to those who retired after 5th April, 1947, in similar circumstances to those who retired upon that date.

The bill also provides that the pension for orphan children shall be increased from £39 to £78 per annum and that for other children from £26 to £52 per annum. The cost of these increases will be met from the Superannuation Fund. It is proposed that all increases provided in the bill shall be paid on and from 31st October, 1957, the nearest date to that from which other pensions have been increased.

Debate (on motion by Senator Kennelly) adjourned.

page 1728

DEFENCE FORCES RETIREMENT BENEFITS BILL 1957

Bill received from the House of Representatives.

Standing Orders suspended.

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

Second Reading

Senator SPOONER:
New South WalesMinister for National Development · LP

– I move -

That the bill be now read a second time.

Honorable senators will recall that the Treasurer, in his speech on the Budget, referred to the Government’s decision to provide increased rates of pension to children of deceased pensioners and deceased contributors under the Superannuation Act.

This bill, which I now have pleasure in presenting, will implement this decision in regard to pensions payable to similar classes of children under the Defence Forces Retirement Benefits Act.

At the same time the opportunity is being taken to make several other amendments, the principal ones being the payment of a new rate of gratuity consequent upon variations in conditions of service of mem bers of the Permanent Defence Forces and changes in title or rank to accord with) Service policy or regulations.

The bill will provide for an increase from. £26 per annum to £52 per annum in therate of pension payable to children under the age of sixteen years, of deceased contributors or deceased pensioners and for an increase from £39 per annum to £78” per annum in the rate of pension payable to children under the age of sixteen years, who are orphans or children of a deceased” father whose wife has been divorced from him.

A further matter dealt with by the bill! concerned the gratuity payable to a member following changes in the period for which he may be re-engaged. The existing legislation provides a gratuity of £120 tothe member who retires on completion of an initial engagement of six years and a gratuity of £360, or one and one-half times, the amount of his contributions, whichever is the greater, to the member who on retirement completes twelve years’ service.

To encourage members to reengageafter completing an initial engagement of’ six years, a shorter re-engagement term of” three years has been introduced; this bill provides a gratuity of £210 to the member who retires after completing nine yearsunder the two engagements.

Provision is also made for an increase in. the rate of gratuity payable to a member who completes six years’ but less than. twelve years’ service and retires upon.i reaching the prescribed retiring age for hisrank. The gratuity payable is an amount equal to £120 for the first six years and’ £30 for each completed year of service beyond six years, thus giving him an entitlement after nine years’ service at least equal’” to that of the member who retires on completion of engagements totalling nine years.

The other matters dealt with in this bill are of a minor nature and generally concern details of administration. The mainpurpose of the bill is to provide increases, in children’s pensions in respect of members of the Permanent Defence Forces to« bring the Defence Forces Retirement Benefits Act into line with the provisions of theSuperannuation Act and for changes ingratuity entitlement to accord with variations in the period for which a member

To-night, when listening to the speeches of those who represent the Labour party - I do not think the little segment has spoken yet - we have heard evidence of a great deal of loose thinking. There has been a tired approach by the Labour party to a piece of inspired and popular legislation. When I say it has been a tired approach to a piece of popular legislation, I point out that whereas in 1952 there were 1,900,000 people in Australia insured under the hospital and medical benefits scheme, in 1957 there are nearly 6,000,000 people insured under it. In a period of five years, well over half of the population of Australia has taken advantage of the legislation nurtured and fought for by this Government, yet the Labour party, in an effort to seek some political advantage, criticizes the hospital and medical benefits scheme of this Government. How ignorant it is in seeking to criticize a scheme which has been accepted by over 6,000,000 people, or more than half the population of Australia! There must be quite a number of people in Australia who would not join a medical benefits scheme solely because they are dyed-in-the-wool Labourites, or commos. Such people do what the Labourites and/or the commos suggest, so it is fair to say that the main body of the Australian people, the thinking people, the unbiased people, have joined a scheme which the Labour party tries to tear apart; but it is the unbiased and thinking people in a country like Australia, not the Labour party, who make the country great.

The Labour party adopts several methods of seeking to tear apart this Government’s scheme. First, it attacks the medical benefit societies that have been registered under the act. It attacks them because they have built up funds to safeguard the interests of those who insure with them. I wonder whether there is any single member of the Labour party - we still have five of them sitting in the chamber at the moment - who would attack the Parliamentary Retiring Allowances Fund because it has built up a surplus over the years? Naturally, any insurance fund must build up a surplus as a safeguard against any catastrophe that might confront it in the years that lie ahead of it. All those who contribute to the Medical Benefits Fund of Australia are proud that, because the organization has been well managed, its assets have been -may be re-engaged. I recommend this bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 1729

NATIONAL HEALTH BILL 1957

Second Reading

Debate resumed (vide page 1725).

Senator MARRIOTT:
TASMANIA · LP

– In rising to address myself to this bill to amend the National Health Act 1953- 1956, I want to say at the outset that I -am amazed at the opposition that the tattered segments of the Labour party have -shown to this measure. It is extraordinary how, when a bill comes before the Senate, this rabble adopts an attitude of trying to tear the bill to pieces in a vain attempt to appeal to a public that is now sickened at its rotten attitude. The public realizes the hypocrisy that emanates from the Opposition in debating any bill that has to do with “the health of the people, with pensions for the people or with the normal welfare of the people. That is why we now see Labour members of Parliament walking out of the Senate.

The Labour party is too pig-headed to admit that there has been introduced into this Parliament by this Government a piece of inspired legislation that has done a tremendous amount of good for an enormous number of people. The attitude of the “Labour party now is similar to the attitude it adopts in connexion with pensions. The “Government and Opposition have equal numbers in the Senate and the Labour party could have successfully moved amendments seeking to increase pensions. However, the Labour party does not have its full numbers present to press such amendments. It gains much publicity by moving the amendments, but it does not have its full numbers present, as it did earlier this week and during last week, to press them. It is because of this fact that the pensioners think of the Labour party, as the public in general thinks of it in connexion with national health, as just a spent force with no sincerity and without ability. Labour illustrated that it was a party without sincerity and without ability when it would not even debate the banking bills, measures which it could have amended. built up. All those who are now insured with that fund know that if their families suffer a calamity, their interests will be safeguarded.

The other line of attack from the Australian Labour party was directed against the medical profession. In the eyes of the Labour party, misguided and badly led as it is to-day, a man is all right if he is a wharf labourer, a transport worker or a builder’s labourer and belongs to a trade union. But at the moment, it appears to be a sin for a young man to go to university and train for the professions of medicine, dentistry, the law or accountancy. That is the attitude of the Labour party at present, although many of those who go through universities with the assistance of the enlightened policy of this Government have come from workers’ homes. In the eyes of supporters of the Australian Labour party, those professional men are crooks or charlatans. During debates on health measures, we on this side of the chamber have to listen to allegations from the Opposition that the medical profession is not only being favoured and safeguarded by the legislation, but is taking advantage of its position to extract money from the taxpayers.

I have explained my approach to this bill in those opening remarks. Now I wish to remind the Senate of the main purpose of this measure. It is to give effect to the announcement by the Treasurer (Sir Arthur Fadden) in his Budget speech that the Government would increase its contribution to hospital benefits payments. That is the main purpose of the bill. It has some other purposes such as cleaning up the drafting of the principal act and making the administration of medical and hospital benefits organizations easier. Its main purpose, however, is to increase the hospital benefits that are provided by the Commonwealth.

I shall never let it be said that I was of the opinion that, through this measure, the Menzies Government is providing an additional amount of assistance for the people. 1 prefer to say that the Menzies Government, by wise administration and by thoughtful action, is returning to those who have to undergo hospital treatment some of the taxes they have paid. That is where J cross swords with those who were for merly rightly termed the Opposition. Honorable senators opposite have talked about free hospital treatment and free medical benefits. There is no such thing and there never could be free hospital treatment or free medical benefits in Australia. Thepeople of Australia provide the Commonwealth with revenue and, ultimately, the cost of hospitals and medical benefits comesout of Consolidated Revenue.

The Australian Labour party should stoptrying to beguile the people by promising, free hospital treatment. The people are awake to this sham. More than 6,000,000- of them have shown that they are prepared to insure themselves just as they insure their homes, motor cars, and lives and thelives of their family. Now they are insuring, their health, and they receive benefits from the funds to which they contribute. Asa result of this measure, they will receive increased hospital benefits. The present Commonwealth hospital benefit is 8s. a day. An extra benefit of 4s. a day is to be paid. The bill provides that the benefit will be increased to 12s. a day for persons who areinsured with registered hospital benefit funds for a fund benefit of 16s. a day or more. That is one obvious purpose of the bill.

This Government has shown a similar purpose in all its social service legislation. I do not think I am wide of the mark when I say that the National Health Act is outside the scope of social service legislation. Underthis Government’s legislation, we provide funds for people who build homes for aged persons. We have increased all sorts of pensions and allowances. This Government’senlightened outlook ensures that if a person helps himself, the Government will helphim. That is the theme of this bill. In hissecondreading speech, the Minister for Repatriation (Senator Cooper) stated -

I want to remind the Senate that the principle of the Commonwealth additional benefit is to help those who help themselves; to assist individuals to make provision for expenses they may incur.

Any government that does that is acting, correctly. It is setting an example. I have said before, and I repeat, that I do not favour a government helping persons who will not help themselves. I do not think the Government should be a good neighbour to all people. It should help those who are willing to co-operate in improving conditions. As-

I have said earlier, the people of Australia, have demonstrated their belief that the attitude of this Government to medical and hospital benefits has proved an outstanding success. Of a population of 10,000,000, more than 6,000,000 are insured in hospital benefits funds. In addition, pensioners get free hospital and medical benefits.

Debate interrupted.

page 1731

ADJOURNMENT

Shipowners and Maritime Unions - Eviction of Soldier Settler - Pairing on Divisions.

The DEPUTY PRESIDENT (Senator the Hon. A. D. Reid). - 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 McMANUS:
Victoria

.- Some weeks ago, I raised in this chamber the question of certain payments that were made by shipowners to maritime unions. The Government stated at the time, and also in reply to questions asked subsequently, that it had the situation under consideration and that one of the factors it would consider in deciding whether any action was necessary would be the report of the interstate executive of the Australian Council of Trade Unions on the matter. That report has been issued, and Mr. Albert Monk, the president of the A.C.T.U., has stated that the executive has banned the practice and that he believed the unions would carry out the ban.

I desire to state that two days after Mr. Monk made that statement, the maritime unions, led by the Communist-controlled Seamen’s Union, demonstrated their defiance of the A.C.T.U. executive’s decision by dividing up another sum of £2,000.

Senator Wright:

– When was that?

Senator McMANUS:

– It was two days after the A.C.T.U. executive declared that the practice was banned.

Senator Wright:

– And when was that?

Senator McMANUS:

– It was about ten days ago. This money related to the sale of the ship “ Benalbo “, which had been sold off the coast some months ago. The sale of this ship and the receipt of the money is nowhere mentioned in the report of the A.C.T.U. Here is a ship involving a payment of £2,000 about which the

A.C.T.U. committee of inquiry failed to mention anything, and about which it was probably left in the dark by the maritime unions. This question must be asked: How many other ships and what other sums of money were likewise not placed before the A.C.T.U. during its inquiry?

The unions appear to regard the A.C.T.U. inquiry as a joke. Immediately after the A.C.T.U. said in May that it would investigate this matter, the sum of £4,125 was divided among the unions for the vessel “ Echunga “. Immediately before the A.C.T.U. congress, where it was anticipated that there would be a strong debate on the practice, the unions divided among themselves £4,375 in respect of “Tyalla”. Immediately after the A.C.T.U. congress, which had been told that an inquiry was proceeding, another £4,000 was taken in respect of the vessel “ Iron Warrior “, £3,500 of which went to the Seamen’s Union. Now, immediately after the A.C.T.U. has officially banned the practice, a further sum of £2,000 has been divided. Thus, since this inquiry was supposed to have commenced, £14,500 has been carved up among the unions concerned.

For the sake of the record, let me read the kind of letter that is being sent to the unions and which indicates the existence of a practice that is a disgrace to Australian trade unionism. This sample letter from Messrs. Banks Bros, and Street, of Royal Insurance Buildings, Pitt and Spring streets, Sydney, Australia, which is dated 1st March, 1956, is addressed to the Secretary, Seamen’s Union of Australia, 54 Daystreet, Sydney, and reads -

Re: “Noora” and “ Kindur “.

We are acting as agents on the sale of the above-mentioned vessels and have made arrangements for them to proceed from Sydney to Hong Kong with a Chinese crew. The “ Nom: “ will be towing the “ Kindur “.

Tn consideration of the Seaman’s Union of Australia agreeing to allow these vessels to sail and to waive any rights it may have for the manning of the vessels or otherwise….. we agree to lodge in a Bank in the joint names of the Seaman’s Union of Australia and Banks Bros. & Street, the sum of £2,000 forthwith.

These moneys are to be released for payment to the Seaman’s Union of Australia when the Chinese crew have manned the vessels and both vessels have been bunkered and stored in readiness for departure.

Yours faithfully, N. R. Rodgers, Secretary.

The findings of the interstate executive of the A.C.T.U. have left the way open for this unsavoury practice to continue. Mr. Elliott, of the Seaman’s Union, has shown in the case of the “ Iron Warrior “ how it will go on in the future. They will order the shipowners to engage what they call a stand-by crew, but the wages that are supposed to go to the crew will be paid to the union, which will then hold a meeting of members in the port, as it did at Newcastle. The members will then decide that the money is to go into the coffers of the union and not to the men concerned. In these circumstances, a serious position has arisen, because it is obvious that whatever strength there is in the A.C.T.U. is going to be evaded or divided.

The report of the A.C.T.U. which I have before me is a rather remarkable document. While it claims that “ the moneys were mainly received by cheque “, the details of the report show that most of the moneys received by the Seamen’s Union were in hard cash. Whilst the report mentions that £4,000 was banked in the emergency fund of the Seamen’s Union, the balance of some £40,000 was put into a fund called a “ Peace and Progress “ fund. It is an interesting coincidence that the slogan of the Communist party at recent elections has been “ For Peace and Progress, Vote Communist “. If we study the report closely, we find that it shows that the president of the A.C.T.U., Mr. Monk, was not told the truth by Elliott of the Seamen’s Union. Mr. Monk said in a press statement in April of this year that the A.C.T.U. under no circumstances would have anything to do with improper practices and would deal with the unions on an affiliation basis if it was proved that one or more of them were guilty. It has been proved conclusively that they were guilty, that Australian seamen’s jobs have been sold while hundreds of men have been out of employment. Apparently attempts are being made to hide these practices by lies, evasions, and half-truths, and for that reason I have felt it to be my duty to raise the matter before the Senate.

I know that the Government has had a particularly busy time in recent weeks, but I request the Government to consider all these factors in’ the coming recess. I believe that, if this matter is evaded, we will face a situation in which industrial blackmail of the worst form will have been condoned. In addition, we will have the spectacle of organizations that claim to be Australian trade unions accepting money from employers to allow foreign crews to be employed on ships to the detriment of the wages and conditions of Australian workers. That is a thing that nobody should tolerate.

The only other point I wish to make is that, if this matter is evaded, apparently the only person who will suffer will be the one trade union secretary who it seems to me has taken a stand against this practice - Mr. McDonald, of the Marine Stewards Union. I have never met him, but I admire the courage he has shown in fighting against these practices. 1 have seen the propaganda and literature that is being issued in the usual Communist style to hound this man from his job because of the firm stand that he has taken in support of the principles of true trade unionism. It will be a bad thing for Australian trade unionism if this practice is condoned and if a decent man can be victimized because he stood up against it.

Senator WRIGHT:
Tasmania

.- I am greatly indebted to Senator McManus for referring to this subject to-night. I have been waiting patiently, since the subject was debated in the Senate several weeks ago, first, for the production of the A.C.T.U. report, and secondly, for an answer to a question which I put on the notice-paper. I realize that perhaps the Minister for Labour and National Service (Mr. Harold Holt) requires further time to consider the contents of the A.C.T.U. report. As Senator McManus has indicated that he has a copy of the report, I ask him, through you, Mr. Deputy President, whether he is prepared to make it available to the Senate.

Senator McManus:

– I am.

Senator WRIGHT:

– That will save the invocation of the Standing Orders to have the report laid on the table. I am most anxious to see it.

I rose only to say firmly that in this matter, as in all other matters of illegality, the processes of the law make no discrimination between combinations of this sort and of other persons subject to the law. I trust that, when we reassemble, we shall not have lost sight of the need for urgency in dealing with a development in the trade union movement, which, if allowed to continue, could destroy the trade of this country to a great degree. I am encouraged to make these remarks because when this question was raised as a matter of urgency in this chamber several weeks ago by Senator McManus, I understood that his action had the support of the Labour Opposition.

Senator AYLETT:
Tasmania

.- I desire to correct a misleading statement made by the Minister for Shipping and Transport (Senator Paltridge) last night in reply to me.

Senator Hannan:

– This matter has been brought up more often than the banking bills.

Senator AYLETT:

– 1 can understand a statement like that coming from the Government side. That is the form of honorable senators on that side. They have only to read an article in a daily newspaper containing a report of a statement made by a responsible Minister of this Government to see how members of the Government are prepared to falsify things for propaganda purposes when it suits them. I have the newspaper in my desk if honorable senators wish to see it. Let me now deal with the subject 1 intended to raise - the O’Shea case, f am fighting for innocent children, but Government senators are prepared to support a decision of the department, arrived at on false evidence, as a result of which these children will be reared in conditions of malnutrition. I make no apology for that statement. If the Minister wishes to debate them after, the challenge I made is still open to him. He can debate the matter on any platform in the electorate of Braddon.

Senator Wright:

– I rise to order. I submit that an honorable senator is not entitled to say that Government senators are prepared to support a decision made on false evidence. That is an imputation of an unworthy motive on my part, as well as on the part of other senators. I ask for a withdrawal.

THE DEPUTY PRESIDENT (Senator the Hon. A. D. Reid).- Order! Senator Aylett will withdraw that statement.

Senator AYLETT:

– I withdraw that statement. Before continuing with the matter I was about to raise when I was interrupted. I shall read an article that appeared in “ The Examiner “ on Monday, 2nd December. I have no need to read much of it. In part, the article reads -

Senator Henty mentioned that the Labor Party had created the worst precedent of all in 1941 when it refused to grant a pair to Senator Wilson (Liberal) who at that time was overseas with the A.I.F.

An honorable senator says that that is not a false statement. If he can find it recorded in “ Hansard “ that the Labor party refused Wilson a pair when he was overseas, I will apologize to each and every honorable senator opposite.

Senator Maher:

– What has this to do with O’Shea?

Senator AYLETT:

– I was led off the track by a point of order after I had said that a Minister had made a false statement. The reported statement of the Minister is a fabrication. At no time did we refuse a pair to Senator Wilson.

Senator Vincent:

– I rise on a point of order. Senator Aylett has just read an extract from a newspaper. I direct the attention of the Senate to Standing Order 414, which reads -

No Senator shall read extracts from newspapers or other documents, except “ Hansard “ referring to Debates in the Senate during the same session.

The extract which the honorable senator read referred to a debate in the Senate during this session.

The DEPUTY PRESIDENT.- The point of order is well founded. The honorable senator must not quote from a newspaper article.

Senator AYLETT:

– I do not need the newspaper now, but I wish to make it clear that on many occasions I walked out of this chamber and paired with Senator Wilson. On other occasions other honorable senators walked out of the chamber and paired with him. I assume the Minister did make the statement attributed to him. Probably I am wrong in accusing him of making it until such time as he admits having done so, but it appears under his name and has not been denied. Senator Wilson could not obtain a pair during a secret ballot. That occasion has been referred to by honorable senators opposite on more than one occasion. No pairs can be granted in a secret ballot because if they were the ballot would not be secret. Those who are fond of reading the Constitution and raising points of order may care to find out whether any provision exists for granting a pair in a secret ballot. If there is such a provision, 1 will apologise for my remarks. I repeat that the statement that the Labour party did not grant Senator Wilson a pair is completely wrong, because we did grant him a pair on every possible occasion.

Let me now return to the subject with which I was about to deal. I claim that I was misquoted by the Minister for Shipping and Transport. The misquotation may not have been intentional on the part of the Minister, but I draw his attention to the fact that, dealing with O’Shea, he said -

This man has proved himself, by every standard, to be an inefficient farmer. Senator Aylett says that is not right; but I say that, on the evidence submitted by the honorable senator, it is right.

The Minister said that on the evidence submitted by me he concluded that this man was an inefficient farmer. I challenge the Minister to produce the evidence that I submitted which leads him to the conclusion that this man was an inefficient farmer. He may have been inefficient, but I produced no evidence to show that he was. I challenge the Minister to point to any evidence that I produced which would show that O’Shea was an inefficient farmer. If I had produced such evidence, I would not be fighting this case. It is not for O’Shea that I am fighting; it is for his innocent children, who are all under the age of sixteen. The Minister said further -

If Senator Aylett now claims that he has some fresh evidence which is available, as I understand it, by way of affidavit, I invite him to submit that fresh evidence and let the case again be re-opened on that basis.

I invite the Minister to collect his thoughts. He will find that the facts contained in the affidavit have been in the file ever since I raised this matter. It is on the basis of those facts that I have made charges against certain people. I have asked the Minister more than once to say whether those charges were correct or not.

Senator Paltridge:

– They are not correct.

Senator AYLETT:

– If that is so, the Minister should get up and say so. He should produce something to prove that they are not correct. I have not made up these allegations. This man has produced a sworn affidavit. I challenge the Minister to bring forth sworn affidavits from the men who have been accused. It will then be open to me to make further personal investigations, if necessary. So far, no such affidavits have been produced, and the Minister has not denied in any way what has been alleged. According to answers that have been given to honorable senators, an adjustment of £500,000 has been made in a certain direction in the last financial year. If we can spend £1,160,000 upon reclaiming Montagu Swamp, and producing only four farms at an approximate cost of £250,000 each, a quagmire, some buried timber and some new-growing scrub, something can surely be done for Mr. O’Shea. If the Minister is to bring the cost of these farms down to £19,000 each he will have to write off a very large sum indeed. Surely, then, the Government can do something to help Mr. O’Shea, who faces the prospect of rearing a family in a state of malnutrition.

I am prepared to meet the Minister for Primary Industry (Mr. McMahon) on any platform in Braddon to debate the O’Shea case. So far as closer settlement generally is concerned, I wish to give credit where it is due, but isolated cases such as I have described, are crying out for attention. Government supporters, however, do not like them being ventilated.

I may say that the only officers who have made an investigation are those whom Mr. O’Shea is charging with shady business. I refer to Mr. Haddy and Mr. Bergess. I do not wish to put any one in a false position, but these officers have been left to make all the investigations and submit all the reports. That is the way in which the matter is going. Let us have a completely independent investigation - into some of those officers as well as into Mr. O’Shea. For the benefit of the Minister I may say that no one has made an investigation since Mr. O’Shea was put off the farm. No one has been near him to see whether he is dead or alive, or what his position is generally.

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– The statement which Senator Aylett read from the Launceston “ Examiner “ was made by me. At the time that I made it I believed it to be true, and I still believe it to be true.

Senator PALTRIDGE:
Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– Like the lovelorn swain in the old song,

Senator Aylett refuses to take “ No “ for an answer.

Senator Aylett:

– I shall continue to refuse.

Senator PALTRIDGE:

– The honorable senator will get nothing more from me until he produces something of a more concrete nature than he did last night, or has done to-night. This case has been submitted to the department over and over again. Senator Aylett, as the parliamentary representative of Mr. O’Shea, has had the whole matter examined, but, as the decision has not gone his way, now says that Mr. Haddy and Mr. Bergess are guilty of shady practices.

Senator Aylett:

– I did not say that they were guilty, I am asking you whether they are or not. You are trying to misconstrue what I have said.

Senator PALTRIDGE:

– The inference to be drawn was that they were guilty of shady practices, lt is up to Senator Aylett to re-open the case by presenting evidence that these gentlemen have not acted with complete good faith. Until he does that the case remains closed.

Senator SHEEHAN:
Victoria

.- The reference which Senator Henty made to the action of the Australian Labour party when Senator Wilson was overseas should not be allowed to pass unchallenged. Senator Cooper is the only Government supporter who was a member of the Senate at that time. The people of Australia had relegated his colleagues to political oblivion. In fairness to honorable senators, Senator Henty should examine the records of the Parliament before he makes a statement such as the one to which he has pleaded guilty, and which he seeks to re-affirm tonight. Before I left the Senate for a short time Senator Wilson had, to my own knowledge, been granted a pair, which was observed by honorable senators of this party. However, during his absence vacancies occurred in the positions of President and of Chairman of Committees.

Senator Henty:

– That is the matter to which I refer.

Senator SHEEHAN:

– As has been stated, the election for those two positions is conducted by a secret ballot. The office of President, or of Chairman of Committees, is filled by the Senate. No pair is granted during such an election. In fair- ness to all concerned, Government supporters who referred to this matter during the banking debate should at least look up the records and see what happened in regard to Senator Wilson.

Senator COOPER:
Minister for Repatriation · Queensland · CP

– As Senator Sheehan has said, I am the only person on this side of the chamber who was present in the Senate when this matter of the election of the President and the Chairman of Committees arose. I regret that this matter has been brought forward - by the Opposition especially - because the Australian Labour party did not come out of that incident very well. Many honorable senators opposite, who were here then, were quite ashamed of what their colleagues did. It is all very well to say that when a ballot is conducted there are no pairs. Some honorable senators will recall that I spoke to them on that particular morning and that it was not until Senator Allan MacDonald of Western Australia was taken to hospital to undergo an immediate operation for a war-caused disability that the representatives of the Australian Labour party decided to nominate a member for the position of Chairman of Committees.

Senator Courtice:

– It was intended all the time to do that.

Senator COOPER:

– Oh no! If that were so, it is an extraordinary thing that you came to me at 1 o’clock and congratulated me upon receiving the nomination for the position of Chairman of Committees.

Senator Courtice:

– I thought you had won.

Senator COOPER:

– I also remind honorable senators who were here then that Mr. Scullin knew nothing about what was going to take place. He knew about it only after it had taken place. He said that had he known, he would have put a stop to it.

Senator Aylett:

– Mr. who?

Senator COOPER:

– Mr. Scullin.

Senator Aylett:

– He was not a member of the Senate. It was not a matter for the whole party. We decided it at a party meeting of senators.

Senator COOPER:

– No, you decided it in the party room. But the decision was made by senators only. It was not a decision by the Labour party. It was a decision by the Labour members of the Senate, lt is against all tradition to say that a pair is not granted in a ballot. Certainly a pair is not shown on paper, lt is not in the Pair Book, 1 admit. But a pair was granted. lt was granted to K. C. Wilson for the whole period of his absence. If honorable senators refer to “ Hansard “ they will not find any complaints about the matter. I did not complain and J. B. Hayes did not complain. We took it, and our opinion of the Labour party at that time, and of the way in which it had handled that ballot, was very low, because we had been given to understand that as long as K. C. Wilson was away the Labour party would match him; it would give him a pair. There was nothing to prevent any member of that side from walking out of the chamber. But none of them did so.

Senator Mattner:

– Was Senator Allan MacDonald given a pair?

Senator COOPER:

– Oh no, Senator MacDonald was taken to hospital. He was not granted a pair. He was taken to hospital that morning. The Labour party, knowing that it had the numbers because of his absence, took advantage of the fact. You will see in “ Hansard “ that I congratulated Senator Brown at that time on being elected to the office of Chairman of Committees. Senator Brown won on a ballot. I have never forgotten the circumstances.

Senator Courtice:

– Won on the draw, not the ballot.

Senator COOPER:

– He won on a ballot, which was taken. At that time the man whose name was left in the box after the draw was the one elected. Losing the position of Chairman of Committees did not worry me. It was the way that the thing was done that worried me.

Senator Sheehan raised this matter to night. As far as I was concerned, the past is the past; but Senator Sheehan got up and tried to smooth this over, and I felt it my bounden duty to let the Senate know what happened in connexion with that ballot in 1941.

Senator BROWN:
Queensland

– As one who participated in the events on that historic occasion, I cannot let the matter pass without a challenge when Senator Cooper brings the name of Mr.

Scullin into the debate and discusses the action of the Labour party in this Senate at that time. The Labour party in the Senate had complete control of its members. When this matter of the election of the President and the Chairman of Committees arose, the Labour party met and decided to contest both elections. Senator Cunningham was selected by the Labour party - properly selected - as its candidate for the office of President. There was no subterfuge, there were no underground tactics of any kind. The meeting was a meeting of our party, duly constituted, which acted properly and which decided to contest the. elections for both offices. Voting, I think, was equal. I just forget the figures-

Senator Cooper:

– Seventeen all.

Senator BROWN:

– Yes, seventeen all. The vote was taken twice.

Senator Cooper:

– The ballot was taken.

Senator BROWN:

– Yes, the ballot was taken. We wrote down the names of Senator Cunningham and Senator J. B. Hayes and they were placed in a box. One name was drawn out of the box. An honorable senator said at the time, “ I do not quite understand this method”. I said, “ It is easy to understand. The man whose name comes out of the box is out, and the man whose name stays in is in “. In the draw for the office of President the name of Senator J. B. Hayes was drawn out, and he was out. Senator Cunningham’s name stayed in the box so he became President of the Senate. I do not see why Senator Cooper should speak as he has done. I could have understood his speaking at the time, as he spoke to-night. I did not dream for one moment that I would be elected Chairman of Committees. I sat where Senator Courtice is sitting now and I was working out in my mind a nice little speech of congratulation to Senator Cooper. Of course, his name came out of the box, and he was out. But there was nothing underhand about it. Everything was done perfectly fairly. As for Senator Wilson, he was given a pair on every occasion; and I do not think it is proper to grant pairs in connexion with the election of the President or the Chairman of Committees by secret ballot.

Question resolved in the affirmative.

Senate adjourned at 11.37 p.m.

Cite as: Australia, Senate, Debates, 4 December 1957, viewed 22 October 2017, <http://historichansard.net/senate/1957/19571204_senate_22_s11/>.

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