11 August 1959

23rd Parliament · 1st Session

The Senate met at 3 p.m.

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His Excellency Field Marshal Sir William Joseph Slim, Governor-General and Commander-in-Chief in and over the Commonwealth of Australia, entered the chamber, and, taking his seat on the dais, said -

Honorable Senators:

I am present to administer to senators elected to serve in the Senate from 1st July, 1959, the oath or affirmation of allegiance as laid down by section 42 of the Constitution.

The Acting Clerk produced and laid on the table the certificates of election for the following members elected, on 22nd

November, 1958, to serve in the Senate for their respective States, from 1st July, 1959:-

New South Wales -

James Jarvist Arnold

Alister Maxwell McMullin.

James Patrick Ormonde

Kenneth McColl Anderson.

Stanley Kerin Amour

Queensland -

Edmund Bede Maher

Gordon Brown

Ian Alexander Christie Wood

Felix Cyril Sigismund Dittmer

Roy Kendall

South Australia -

James Philip Toohey

Rex Whiting Pearson

Clement Frank Ridley

Keith Alexander Laught

Arnold Joseph Drury

Tasmania -

Justin O’Byrne.

William Edward Aylett

George Ronald Cole

Alexander Elliott Davidson Lillico

John Edward Marriott

Victoria -

John Grey Gorton

Patrick John Kennelly

Ivy Evelyn Wedgwood

Albion Hendrickson

George Conrad Hannan

Western Australia -

Malcolm Fox Scott

Joseph Alfred Cooke

George Howard Branson

Hartley Gordon James Cant

Thomas Charles Drake-Brockman

The above-named senators, with the exception of Senators Branson and Hannan, who had already been sworn, made and subscribed the oath of allegiance. (His Excellency the Governor-General having retired) -

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Senator SPOONER (New South Wales-

Vice-President of the Executive Council and Minister for National Development). - Mr. Acting Clerk of the Senate (Mr. Odgers), I remind the Senate that the time has come when it is necessary for the Senate to choose one of its members to be President. I move -

That Senator Sir Alister Maxwell McMullin do take the chair of this Senate as President.

Senator McKENNA:
Leader of the Opposition · Tasmania

Mr. Acting Clerk, I propose to the Senate for its President Senator Nicholls, now present, and I move -

That Senator Theophilus Martin Nicholls do take the chair of the Senate as President.

Senator Kennelly:

– I second the motion.

The Acting Clerk.- Will the two candidates address the Senate?

Senator Sir Alister McMullin:

– I submit myself to the will of the Senate.

Senator Nicholls:

– I submit myself to the will of the Senate.

The Acting Clerk. - There being two nominations, in accordance with Standing Order No. 20, a ballot will be taken. Before proceeding to ballot, the bells will be rung for two minutes. (The bells having been rung) -

The Acting Clerk. - The Senate will now proceed to ballot. Ballot-papers will be distributed to honorable senators, each of whom is requested to write upon the paper handed to him the name of the candidate for whom he desires to vote. Standing Order No. 20 reads -

When two Senators have been so proposed and seconded as President, each Senator shall deliver to the Clerk a Ballot paper in writing, containing the name of the Candidate for whom he votes; and the Candidate who has the greater number of Votes shall be President, and be conducted to the Chair.

The Clerks:

-Assistant will now distribute ballot-papers to all honorable senators. (A ballot having been taken) -

The Acting Clerk. - I have to announce the result of the ballot as follows: - Senator Sir Alister McMullin, 32 votes, and Senator Nicholls, 24 votes. I therefore declare Senator Sir Alister McMullin elected President of the Senate. (Senator Sir Alister McMullin, having been conducted to the dais) -


– Honorable senators, I wish to express my thanks to you for your having re-elected me President of the Senate. It is a great honour to serve you; it is a great honour to serve the institution of Parliament. I am sure that the good relationships and the goodwill that have so marked the work of the Senate in the years I have held the position of President will continue, that much good will result from the work of the chamber itself, and that Australia will be the richer because of the services rendered by the members of this Senate, over which I have the privilege to continue to preside.

Senator SPOONER:
Minister for National Development · New South WalesVicePresident of the Executive Council and Minister for National Development · LP

Mr. President, it is my privilege to extend to you the congratulations of the Senate upon your re-election as our President. Whilst the Senate does you personally great honour in choosing you as its President, on the other hand the’ Senate itself, is fortunate in your presidency. Not only have you, Sir, acted impartially during the long period that you have been President, but you have graced the position both inside and outside the chamber in so many ways.

Sir, it is a great, thing in the life of any parliamentarian to have served as President of the Senate for a period of six years and then to be re-elected for a further period, because the office of President of the Senate is. one of the really great offices of the Parliament. It is a good thing for us, as a Senate, that we have as our choice some one who has not only acted impartially but also has taken an interest in parliamentary matters outside of the work of the Senate itself. What you have done, Sir, in connexion with the Parliamentary Library, and in other directions, has not escaped our notice. I think that the standing and the prestige of the Senate are enhanced when it has, as its President, one who has very worthily represented the Parliament of the Commonwealth of Australia at parliamentary gatherings, both, within. Australia and overseas.

Sir, I congratulate you upon your appointment. You commence your new term of office with the goodwill of the individual senators. I think I express the views of all members of this chamber when I say that, we wish you goodwill in your further term of office, being quite sure that you will add to the lustre of your reputation in this new sessional period of the Twenty-third Parliament as you have done in the past.

Senator McKENNA (Tasmania - Leader of the Opposition). - Mr. President, it is my particularly pleasing duty to offer to you on behalf of the Opposition our very hearty congratulations upon your re-appointment to your very high office. The fact that the Opposition nominated a candidate for the office was done pursuant to its conception of its duty as an Opposition. You, understanding that so well, will realize that there was not implied in any way any lack of appreciation of your own very judicial approach to matters in this chamber, your very judicious handling of the Senate itself, and the great ability with which you have performed the very high duties of your office.

The Opposition is both hopeful and confident that you will continue to maintain the high standard that you have set in that office during the past six years. I hope that you will enjoy the next term as a pleasant and a peaceful experience so far as such is possible in this place of public disputation. Every senator on the Opposition side joins with me, Mr. President, in extending to you the warmest congratulations.

Minister for Repatriation · Queensland · CP

Mr. President, on behalf of the Australian Country Party, I should like to offer my congratulations upon your re-election to the high position of President of this Senate. We all look forward to a continuance during your ensuing term of office of the happy relationships that have existed since you have been President of this chamber.

Senator COLE:
Leader of the Australian Democratic Labour Party · Tasmania

Mr. President, I wish to extend to you the congratulations of my party on your reelection to the presidency of the Senate. I should like to say that, because of the courtesy and fair-mindedness which you have displayed during your last term of office, on this occasion, unlike the last one, we were able to remain in the chamber to participate in the ballot. Senator McManus and I have endeavoured to show our appreciation of the manner in which you carried out your duties during your last term of office as President by remaining in the chamber to record our votes.


– I thank honorable senators very much for their congratulatory remarks.

Senator SPOONER (New South WalesVicePresident of the Executive Council and Minister for National Development). - I wish to inform honorable senators that His Excellency the Governor-General will be pleased to receive Mr. President, and such honorable senators as desire to accompany him, in the Senate Opposition Party Room forthwith..


– I invite honorable senators to accompany me to the Senate Opposition Party Room, where I shall present myself to His Excellency the GovernorGeneral as the choice of the Senate.

Sitting suspended from 3.41 to 4.38 p.m.

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– I have to report that, accompanied by honorable senators, I have, this day, presented myself to His Excellency the Governor-General as the choice of the Senate, and His Excellency was pleased to congratulate me upon my election.

The President read prayers.

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Motion (by Senator Spooner) agreed to -

That the Senate do now proceed to elect a Chairman of Committees.

Minister for Repatriation · Queensland · CP

– I move -

That Senator Reid be appointed Chairman of Committees.

Senator Spooner:

– I second the motion.

Senator Reid:

– I submit myself to the will of the Senate.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move -

That SenatorO’Byrne be appointed Chairman of Committees.

Senator Kennelly:

– I second the motion.

Senator O’Byrne:

– I submit myself to the will of the Senate.


– There being two nominations, the Senate will proceed to ballot. (A ballot having been taken) -


– The result of the ballot is: Senator Reid, 30 votes; Senator O’Byrne, 23 votes. I declare Senator Reid elected.

Senator REID:
New South Wales

– I express my appreciation to the members of the Senate for having re-elected me as Chairman of Committees.

I trust that during my term of office my association with honorable senators will be as pleasant as it has been in the past. When I have been in the chair I have always felt an obligation to get the business of the committee through as expeditiously as possible, but I have always endeavoured to be fair to all honorable senators. It has not mattered to me to which side of the chamber honorable senators have belonged; I have always felt that I must remain neutral and must keep command of the com mittee so that the despatch of its business may be facilitated. I repeat that I appreciate to the full the action of honorable senators in again electing me as Chairman of Committees.

Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP

– I should like to avail myself of this opportunity to congratulate Senator Reid upon his re-election as Chairman of Committees. Senator Reid has the great advantage of a long parliamentary experience gained, not only in this chamber, but also in the Parliament of New South Wales, where for some years he was a Minister of the Crown. Such experience is of great value in the committee work of the Senate, which I think is the most interesting part of our parliamentary proceedings and which has attracted a good deal of favorable attention. Indeed, the work of the Senate in committee is one of the strengths of the Commonwealth Parliament. We have a lot to thank Senator Reid for in his contribution to that work, and we look forward to working under his guidance in the future as we have in the past.

Senator McKENNA (Tasmania - Leader of the Opposition). - Mr. President, through you I should like to extend to Senator Reid the congratulations and respects of the Opposition upon the occasion of his reelection to the office of Chairman of Committees. In that office he passes from the role of an ordinary senator participating in the long-range exchanges of the Senate into what I may be pardoned for describing as referee of the in-fighting of the committee, where the exchanges are rather fast and furious. Let me add that Senator Reid, in his capacity as Chairman of Committees, has been as quick on the draw as any of the contestants. I feel certain that he would not enjoy the proceedings any more than we would if they were too peaceful, and I heartily assure him, on behalf of the Opposition, that we shall do our best to ensure that he continues to enjoy them.

Senator Reid is indeed experienced; he knows committee procedures exceedingly well. We look forward to working under him for the period that lies immediately ahead. We extend to him our very best wishes on this occasion.

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– I have received from His Excellency the Governor-General a commission to administer to honorable senators the oath or affirmation of allegiance.

Commission laid on the table and read by the Acting Clerk.

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Assent to the following bills reported: -

Appropriation Bill (No. 2) 1958-59. Appropriation (Works and Services) Bill (No. 2) 1958-59. Supply Bill 1959-60. Supply (Works and Services) Bill 1959-60. Sulphuric Acid Bounty Bill 1959. Commonwealth Aid Roads Bill 1959. Conciliation and Arbitration Bill 1959. Public Service Arbitration Bill 1959. Gold-mining Industry Assistance Bill 1959. Cellulose Acetate Flake Bounty Bill 1959. Rayon Yarn Bounty Bill 1959. Tractor Bounty Bill 1959. Housing Loans Guarantees (Australian Capital Territory) Bill 1959. Housing Loans Guarantees (Northern Territory) Bill 1959. Fisheries Bill 1959. Bankruptcy Bill 1959. Judiciary Bill 1959. Australian Capital Territory Supreme Court Bill 1959. Statutory Declarations Bill 1959. Western Australia Grant (Northern Development) Bill 1959. Customs Bill 1959.

Sitting suspended from 4.56 to 8 p.m.

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Motion (by Senator Spooner) put -

That so much of the Standing Orders be suspended as would prevent the Minister for Shipping and Transport and Minister for Civil Aviation (Senator Paltridge) speaking without limitation of time when moving that the Estimates and Budget Papers 1959-60 be printed.


– There being present an absolute majority of the whole number of senators, and no dissentient voice, I declare the question resolved in the affirmative.

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Minister for Shipping and Transport and Minister for Civil Aviation · Western Australia · LP

– Ilay on the table the following papers: -

Estimates of Receipts and Expenditure, and Estimates of Expenditure for Additions, New Works and other Services involving Capital Expenditure, for the year ending 30th June, 1960.

The Budget 1959-60 - Papers presented by the Right Honorable Harold Holt in connexion with the Budget of 1959-60; and

National Income and Expenditure 1958-59 - and move -

That the papers be printed.

To-night, the Treasurer (Mr. Harold Holt) is delivering in another place his Budget speech for 1959-60. I should like to refer briefly to some of the main features of the Budget and to the relevant circumstances of the economy as a whole.

Generally, 1958-59 proved a better year than we expected this time twelve months ago. It was a notable year for rural production and, in the secondary field, the majority of industries increased their output. Employment rose considerably and unemployment fell. Construction ofhouses and flats ran along somewhere about 80,000 a year, which is a very high figure. Other forms of building activity continued strongly. There was considerable expenditure on factory plant, and rural investment seems to have held up quite well. Business had remarkable success in raising new capital.

Externally our position improved as the year went on, and, instead of our overseas reserves falling by something over £100,000,000 as had been feared when the year began, they fell by only £10,000,000. At 30th June last, they stood at £515,000,000, which is a comfortable figure.

Fortified by this improvement, the Government has raised the ceiling for import licensing from £800,000,000 a year to £850,000,000. It has also done much to reduce discrimination between sources of supply so that, as to more than 90 per cent. of the goods we obtain abroad, importers are now free to seek their requirements anywhere they choose.

These are the essential facts of a successful year. They are especially significant because they indicate that high activity was maintained and substantial progress made despite an external setback which, earlier, would have brought on a sharp recession.

Our current prospects are more favorable than those of twelve months ago. Overseas, there is an upswing in production and trade. With a good season, export production will again be high and, given some rise in wool prices over the relatively low average of last season, it could be a good export year. If capital inflow keeps on at something like the Tate of recent times, that also will assist our balance of payments. Internally, employment is high, investment has been running strongly and several factors - the recent basic wage increases amongst them - should tend to promote consumption expenditure.

However, it is not simply a matter of holding our position. Expansion must go on. Our whole economy these days is based upon the assumption of strong and continuous growth.

For that reason, amongst others, it is important not to restrict our view on these matters solely to the problems closest at hand. We must strive for a longer perspective. The Government is now in its tenth year of office and the decade over which it has had responsibility for national administration has seen great achievements. When the decade began, we had much against us. There were still some post-war dislocations and shortages, and then came the Korean War boom. Yet at no time, except briefly in 1952, was there anything like a serious interruption of growth.

Industrial progress has been remarkable. Rural industry has shown striking gains. In mining, there has been progress on much the same scale.

Can this broad achievement be equalled or surpassed in the current decade? In some respects, conditions are more favorable than ten years ago. There are not now the crippling shortages of materials, equipment, fuel and power which then hampered progress. Our labour force will be growing relatively to our population, and it will be a better-balanced and more versatile labour force. We seem also to have found in recent years a remarkable basis of stability - economic, political, social and industrial. These factors should all help us to achieve a rising national product, and that in turn should make it easier for us to maintain and improve living standards, at the same time providing the additional capital facilities which expansion requires. But there will be the same problems as in the past of keeping up an adequate momentum of growth without trying to run faster than our legs will carry us and of securing full employment of resources and the most efficient distribution of resources.

For these requirements, confidence is vital. Confidence here relies on a basic assurance that steady growth will go on.

This gives a key significance to the migration programme. Three years ago, the Government decided that, subject to periodical review, it would aim at an average net immigration equal to about 1 per cent, of population a year. Since then, however, the annual target for gross migrant intake has been kept at 115,000 and, with total population rising, this has meant that the rate of net migration has fallen appreciably below 1 per cent. If this ratio were to decline too far, we would be falling substantially behind the rate of general population increase on which many forward plans have come to be based. It is not good that this should happen; the Government is also convinced that, with the broad expansion of the economy, we can now absorb rather more immigrants than we could some years ago. Accordingly, it has decided to adopt for this year a target for gross intake of 125,000 people - 10,000 over the target for 1958-59 and about 8,000 more than actual gross intake in that year. As in the past, the target will be reviewed from year to year.

To keep all resources, and particularly our resources of labour, fully employed is, of course, not only a social obligation but also a vital economic need. So far, the rising numbers of new workers appear to have been successfully absorbed. This is encouraging; but the number will grow fairly rapidly in the next few years. It is a challenge to which the Government and, I am glad to say, the world of trade and industry, are very much alive.

In the sustained, collective effort which expansion demands, there is a role for every one. There must also be effective partnership between our various governments and other public authorities. In the past year, we have made great headway in that direction. First, there is the new Commonwealth Aid Roads scheme under which the Commonwealth makes large and increasing payments for roads expenditure over five years, and the States have the opportunity to obtain still more by contributing from their own resources. More important still are the new arrangements for general financial assistance to the States for which legislation will be introduced this session. These arrangements, which are to apply for six years, were worked out in the friendliest spirit with the State governments and they offer good prospects of settling the longvexed problem of allocating resources between Commonwealth and State governments, according to their respective responsibilities.

Similarly, there must be partnership between government and business in its various forms. The main task of production belongs to industry, with public authorities providing’ basic facilities and services. In a growing economy the demand for such services and facilities is necessarily strong but, if provision for them is pushed ahead too fast, the cost will fall back on business and on the community in the form of higher taxes. It is important to keep the burden of taxes, down to a minimum. It is even more important that the government should, so far as its powers and resources, allow, promote a condition of progress combined with stability;, and that is essentially what we have endeavoured to do.

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This year, the amount being provided for defence is £192,800,000. Last year expenditure was £189,308,000. Like other governmental activities,, defence is being affected’ by increases in rates of pay and other costs and additional provision has been made for these factors.

National Welfare Fund

The Government has had to consider what, if anything, should be done this year to improve various social service benefits. This is, of course, one of the two largest items of Commonwealth expenditure and it has risen fast in recent years. Moreover, to make any significant additions to major benefits, like age and invalid pensions, must add substantially to total expenditure because there is such a large number of beneficiaries. On the other hand, the aged and infirm are generally less able to assist themselves than most others in our community and, if they have a case for additional aid, it must naturally have a strong claim to consideration by the Government. After reviewing the subject of social services generally, the Government has decided to bring forward proposals for increases in certain major benefits.

Age, Invalid and Widows’ Pensions

Last year supplementary assistance of 10s. per week was introduced to assist eligible pensioners who pay rent. The measure has been effective in relieving hardship in a number of cases, although it is. interesting that applications for this form of assistance in 1958-59 were considerably less than half the number which had originally been, expected1..

This year all age and invalid pensions will” be increased by 7s. 6d. per week to a new maximum of £4 15s. per week. The same increase will be granted in widows’ pensions, raising the pension for widows with one or more children to £5 per week and for other widows to £4 2s. 6d. per week. It is worth noting that, for an agedcouple both of whom are entitled to pension, the rise in combined pension will be equal to the recent increase in the federal basic wage.

The proposed increases in pensions will become payable on the first pension payday after the necessary legislation has been passed.. The estimated cost of the increase is £12,700,000 in a full year and £9,525,000 in 1959-60.

Benefits for Aborigines

Aborigines, unless they are nomadic or primitive, are, in effect, already eligible on much the same basis as the rest of the community for all social service benefits other than pensions and maternity allowances. Legislation will be introduced to provide that Australian aborigines, unless they are nomadic or primitive, will be eligible to receive pensions and maternity allowances on the same basis as other people. The additional1 cost will be £1,000,000 in a full year and £500,000 in 1959-60. Payments will be made direct to aborigines in some cases; in others, some or all of the payment will be made for the welfare of the aborigine concerned to missions, State or other designated authorities or persons. At present, the eligibility of these aborigines to receive pensions or maternity allowances generally depends on whether they are in possession of a certificate of exemption from the law of the State in which they reside relating to the control of aborigines. This qualifying condition will be removed.

Medical Benefits

The Government intends to negotiate with registered medical benefits funds with a view to introducing a plan for considerably higher Government and fund benefits for major surgery and certain other medical services. Under this plan, benefits for many surgical services will be substantially increased. The maximum Government and fund benefit payable for a major operation is now commonly £30. This will be increased to £60. The plan will involve an increase of a few pence per week in the contributions payable by insured persons to their medical insurance organization for the increased fund benefits to be provided.

It is proposed that the necessary legislation will be introduced during these sittings of Parliament and that the plan will apply to medical services rendered on and after 1st January, 1960.

The cost is estimated to be £475,000 in a full year and £100,000 in 1959-60.

Hospital Benefits

Last year the Government introduced a plan to make possible under the hospital and medical insurance arrangements the payment of fund benefit in chronic and pre-existing ailment cases.

Some anomalies have developed and it is now proposed to re-define the class of case to which this special benefit will be payable. Under the new definition, claims for payment of special fund benefit for treatment in “ unrecognized “ hospitals will be allowed in cases where it is established, firstly, that the patient is suffering from a condition for which he would normally be admitted to a general public hospital and, secondly, that he is actually receiving hospital treatment of a standard substantially equivalent to that which he would have received at a general public hospital. Further details of the amendment proposed will be announced when the legislation is introduced, following negotiations with the hospital insurance organizations.

Tuberculosis Allowances

Allowances payable to single and married sufferers from tuberculosis will be increased by 7s. 6d. and 15s. per week, respectively, to £6 17s. 6d. and £1 1 2s. 6d. per week.

The additional cost will be £80,000 in a full year, and £60,000 in 1959-60.

Pharmaceutical Benefits

The Government has decided to make two important changes in the system under which pharmaceutical benefits are provided for the public. These changes have become necessary through revolutionary developments arising from the discovery of new and very costly drugs. It would have been contrary to the intention of the national health scheme not to make these drugs available as benefits. However, the inevitable consequence has been that many of these expensive drugs are now widely prescribed without regard to their cost, in order to save the patient the expense of paying for other drugs which are not included in the pharmaceutical benefits scheme.

The result has been to make the taxpayer responsible for a great deal of expense, much of it perhaps difficult to justify.

On the one hand, therefore, it has been decided to extend considerably the list of drugs which may be prescribed under the scheme so that doctors will have a choice extending virtually over the whole field of drugs and medicines. On the other hand, a charge of 5s. will be made for each individual prescription.

Under the new arrangements the patient’s position will thus be that practically every prescription written for him by his doctor will fall within the scheme. Whilst he will pay 5s. per prescription for a range of drugs which are now free, he will at the same time pay no more than 5s. per prescription over a range which, in many cases, would now cost him a great deal more.

The chemist’s position will be that the long-standing arrangements already existing between him and the Commonwealth for payment for life-saving drugs will be extended to a comprehensive range of medicines. The fee of 5s. for each prescription will be retained by him in part payment of the cost and the Government will pay the balance.

Most pensioners now obtain a very wide range of medicines free of charge under the pensioner medical service. Their position will not be affected by the new arrangement; in other words, the medicines they obtain will continue to be entirely free. Adequate arrangements will be made to ensure that sufferers from diseases where a specified drug is essential for the maintenance of life - for example, diabetes - will not suffer hardship by reason of the need to renew their supplies of the drugs at too frequent intervals. In these special cases payment of a single fee of 5s. will cover supplies of the drug for a reasonable period.

The full details of this plan will be announced after the Government has conferred with the professional bodies concerned, and will be the subject of legislation to be introduced later in this session.

Total Social Services Expenditure

After bringing these various proposals into account total expenditure from the National Welfare Fund in 1959-60 is estimated to be £300,785,000. Expenditure in the last financial year was £278,227,000.

War and Repatriation

The Government also proposes to make substantial increases in a number of repatriation benefits. It will increase the special rate of war pension payable to those totally and permanently incapacitated through war service by 15s. per week, bringing the pension to £12 5s. per week. The full - 100 per cent. - general rate of war pension will be increased by 7s. 6d. per week to £5 10s. per week. The war widow’s pension will also be increased by 7s. 6d. per week, making the rate of £5 5s. per week. In addition, the domestic allowance payable to widows with children under sixteen, and certain other classes, will be increased by 7s. 6d. to £2 15s. per week.

The Government has also agreed to extend, in certain respects, the scope of free medical treatment now provided for war widows, the children of deceased members, and certain widowed mothers. In particular, treatment in country hospitals may now be authorized in special cases, and the range of specialist and out-patient services will be extended.

The service pension payable to certain classes of ex-service men and women will be increased by 7s. 6d. per week to a maximum weekly rate of £4 15s. Further proposals include increases in rates of allowances payable for certain serious disabilities under the Fifth Schedule to the Repatriation Act, adjustments in subsistence and attendance allowances, and a new clothing allowance payable to amputees and certain other classes where the nature of the disability or treatment results in deterioration of clothing.

These various repatriation proposals are estimated to cost £4,021,000 in a full year, and £3,016,000 in 1959-60. Total expenditure on war and repatriation services this year is estimated at £87,485,000 compared with £79,405,000 in 1958-59.

Payments to the States.

The amount provided for payments to the States this year is £321,728,000. The grants payable under the new roads legislation are expected to be £42,325,000, which is approximately £5,000,000 greater than the amount provided from Consolidated Revenue last year for Commonwealth aid roads purposes. In addition, an amount of approximately £2,000,000 will be payable this year to complete the payments under the previous roads legislation. The pronosed new financial assistance grants for this ear amount to £244,500,000 and the Commonwealth Grants Commission has recommended special grants of £7,299,000. The proposed grants available to the States in 1959-60 for general revenue purposes therefore amount to £251,799,000.

Business Undertakings

Current expenditure of the business undertakings is estimated at £123,284,000, which is an increase of £10,056,000 over 1958-59. Of this increase, £8,498,000 relates to the Post Office and is due partly to expansion of business, but more particularly to increased wage and salary costs and to the fact that an additional pay-day falls within this financial year. Expenditure on broadcasting and television is expected to increase by £1,255,000.

Capital Works and Services

Expenditure on Capital Works and Services this year is estimated to be approximately £142,000,000. Expenditure in 1958-59 was £132,349,000. It is considered necessary to provide an additional £2,791,000 over expenditure last year for Post Office technical equipment. Expenditure on the Albury-Melbourne standardgauge railway is expected to be £4,900,000 this year, an increase of £3,273,000 over last year. This will probably be the peak year; next year expenditure will be somewhat less, although still fairly substantial; after that it will fall away rapidly. The estimate for the Snowy Mountains scheme is £1,600,000 greater .than expenditure in 1958-59. Expenditure on the Snowy, Which has risen steeply in the last two years, is expected to fall back to an appreciably lower level in 1960-61, and for some years thereafter. Provision for the National Capital Development Commission will be £1,000,000 greater than expenditure last year.

Departmental Expenditure

The estimate of departmental expenditure in 1959-60 is £72,682,000, an increase of £7,249,000 over expenditure in 1958-59. This item will be heavily affected by the full year cost of the recent basic wage increase, which is estimated at £1,500,000, and the additional pay-day which falls in this year, adding approximately £1,800,000.


The estimate of expenditure on the Territories this year is £23,660,000, which represents an increase of approximately £3,000,000 over expenditure in 1-958-59. The provision for Papua-New Guinea is £13,123,000 or £1,528,000 more than last year.

International Relief and Development

A total sum of £6,259,000 is being provided for international relief and development, this being an increase of £2,161,000 over actual expenditure last year. The main item is, of course, Colombo Plan aid for which the estimate is £5,500,000.

Defence Forces Retirement Benefits, Superannuation and Compensation

The report of the committee, under the chairmanship of Sir John Allison, upon the Defence Forces Retirement Benefits Act 1948-1958 has been closely considered. Legislation will be brought down at an early date to increase the pensions available to contributors and rates of contribution. There will also be alterations in the Superannuation Act 1922-1958 to restore the basis of pensions that was adopted for the 1954 legislation. The Government has also decided to increase, on a contributory basis, the future pensions for the widows of service men and public -servants who are contributors to .the schemes. These changes are estimated to cost £435,000 in a full year.

Careful thought has been given to the position of existing pensioners, many of whom retired a number of years ago with pensions that were a proportion of the salaries being paid .at that time. Legislation will be brought down to provide, in respect of all existing pensions, an increase in the benefit for widows from one-half to . five.eighths of the full pension. The cost of this proposal, which will diminish in later years, is estimated at £300,000 in its first year.

The Government has also reviewed the provisions of the Commonwealth Employees* Compensation Act 1930-1956 and will increase the benefits provided under that act for death or disablement. The cost of these changes is estimated to be £120,000 per annum.


The estimate of total expenditure on items ordinarily charged to the Consolidated Revenue Fund is £1,385.263,000 which is £88,020,000 above actual expenditure in 1958-59.

Other Commitments

Over and above the expenditure just described, the Commonwealth has undertaken, subject to need and certain other conditions, to give some support to the Australian Loan Council borrowing programmes for 1959-60. As agreed by the Loan Council at its annual meeting in June last, these programmes total £220,000,000, which is £10,000,000 greater than the programmes last year. It is expected also that substantial amounts of maturing debt will again have to be redeemed. Whilst there are no loans maturing abroad this year, three large loans fall due within Australia and of these two are very widely held. In addition, repayments of International Bank loans will amount to £7,200,000 and it will be necessary also to redeem war savings and savings certificates.

It is very difficult indeed to estimate what the total amount of debt redemptions will be since a great many factors can affect the outcome. The Government will make special efforts to induce holders of maturing securities to take up new securities rather than to seek cash payment. The amount of debt maturing this year, which at 30th June last was in non-official hands, was somewhat greater than the comparable amount at 30th June, 1958. In 1958-59 total redemptions were £72,000,000. After taking various factors into account, the estimate for redemptions this year has been placed at £70,000,000.

Funds will also be required for war service land settlement - the amount is estimated at £7,000,000.

Total Expenditure Commitments

Taking together the items of expenditure ordinarily charged to Consolidated Revenue, estimated at £1,385,263,000, the Loan Council borrowing programmes, £220,000,000, estimated redemptions of maturing debt, £70,000,000, and war service land settlement, £7,000,000, the total amount for which, it is estimated, cash will be required in 1959-60 is £1,682,263,000.

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Revenue will be substantially greater this year than in 1958-59 when, it will be remembered, there was a fall in revenue by comparison with the previous year. The fact that additional revenue will be available naturally gives rise to the question whether some tax relief can be given. The question must of course be considered in relation to the budgetary position as a whole and that in turn must be related to the state and prospect of the economy. Such issues apart, however, there is always the further question of what changes can or should be made in the current system of raising revenues from various sources. After examining the whole position thoroughly the Government has decided to make a number of tax concessions. The principal concession is in direct personal income tax. Faced with a multitude of various requests, the Government has concluded that this form of tax relief is the fairest and most widespread that could be given at this time.

Income Tax

A 5 per cent, reduction will be made in the income tax payable by individuals. The reduction, which will apply to income of the current year 1959-60, will be in the form of a rebate of ls. in the £1 of the tax calculated at last year’s rates. By applying the reduction on this basis, equal proportionate relief will be given to all the 4,000,000 taxpayers who are subject to individual income tax.

Instalments from salaries and wages will be appropriately reduced as from 1st October next, which is the earliest date by which it will be practicable to distribute the revised instalment schedules to employers. The 5 per cent, reduction will also be reflected in provisional tax for 1959-60. The cost to revenue will be £20,000,000 for a full year and £17,900,000 in the current year.

Life Assurance and Superannuation Payments

Consistently with its desire to encourage thrift and personal savings, the Government has decided to raise to £400 the maximum allowance for life insurance premiums, superannuation contributions and similar payments. The limit is now £300. The cost to revenue is estimated at £400,000 in a full year, but there will be little or no cost in 1959-60.

Aged Persons

The Government has two proposals to afford taxation relief to aged persons. The first is to increase the level of the age allowance for taxpayers who are residents of Australia and who are qualified by age - men 65 years and women 60 years. The new exemption limits will equal the total of the increased age pension now proposed and the maximum permissible income for pension purposes. That is to say, whereas tax is not at present payable if the aged person’s net income does not exceed £410, in future tax will not be payable if the aged person’s income does not exceed £429. In the case of aged married couples, the present exemption level of £819 for combined incomes will be raised to £858. The cost to revenue of this concession will be £550,000 in a full year and £400,000 in 1959-60.

The second proposal relates to deductions for medical expenses paid by a taxpayer aged 65 years or over in respect of a person, either self or spouse, who has attained the age of 65 years. In these cases, the limitation of the deduction for medical expenses to £150 per person is to be removed. The concession is limited to taxpayers and their spouses and the present limit of £150 per person will continue to apply in respect of expenditure relating to other persons. The cost of the concession will be £40,000 in a full year. There will be no cost in 1959-60.

Restitution Payments Received by Australian Residents from the Government of Western Germany.

In 1953, the Federal Republic of Germany accepted responsibility for restitution in respect of personal injuries and losses suffered by residents of Germany under the Nazi regime both before and during the 1939-45 war. These restitution payments are made partly as capital amounts and partly in the form of pensions. Some of the people receiving these payments are now residents of Australia. In these cases, the capital sums are free from tax, but the pensions, being of an income nature, are technically liable to Australian tax.

Having in mind the unfortunate circumstances for which restitution is being made, the Government has decided that the value of these pensions should not be diminished by taxation. Exemption will accordingly be granted, with effect from 1st July, 1959. The cost to revenue is estimated at £25,000 in 1960-61 and later years. There will be no cost in 1959-60.


It is proposed to allow the deduction of gifts of £1 and upwards to the following: -

The Australian National Committee for the United Nations World Refugee Year.

Approved marriage guidance organizations.

The Northern Territory National Trust

The Council for Jewish Education in Schools; provision has previously been made for such a deduction in the case of gifts to the Council for Christian Education in Schools.

It is estimated that the cost to revenue of these four items will be £75,000 in 1960-61, but there will be no cost in 1959-60.

Private Companies

Under our income tax system, private companies pay a primary tax and, if a sufficient amount is not distributed as dividends to shareholders, a secondary tax at the rate of 10s. in the £1 becomes payable.

The amount of a sufficient distribution is determined according to a formula which allows for the retention of a portion of business profits.

This retention allowance ranges from 50 per cent. of the first £1,000 of distributable income down to 25 per cent. of the excess of distributable income over £4,000.

Since the present limitations have been in force much complaint has been made that the penalties for insufficient distributions have prevented the younger and growing companies from retaining sufficient profits to ensure stable development. Often, they do not find it as easy as longerestablished companies to get access to additional capital either from the banking system or the public and so they have to rely to a greater extent on building up capital from their earnings. The Government has decided, therefore, that, commencing with the income year 1958-59, the minimum retention allowance in relation to business profits will be increased to 35 per cent. The new scale will thus be as follows: -

The cost to revenue is estimated at £2,200,000 in a full year and £1,275,000 in 1959-60.

Oil Exploration

As the Treasurer announced in Maylast, the Government has decided to make certain further concessions to companies engaged in oil exploration in Australia, Papua and New Guinea. Further details will be given when the legislation is introduced. The proposals will apply from the commencing date of the original provisions which was 1st October, 1958. The cost to revenue is estimated at £1,250,000 per year, including 1959-60.

Mining Industries

Proposals will be brought forward to liberalize under certain circumstances the depreciation provisions relating to various categories of expenditure by mining concerns on housing and certain other amenities.

The annual cost to revenue is estimated at £250,000 including 1959-60.

Withholding Tax on Dividends paid to Non-residents.

In his Budget speech for 1957-58 the then Treasurer, Sir Arthur Fadden, announced that many representations had been made concerning the method of taxing dividends paid to shareholders residing outside Australia. Overseas investors pointed out that the replacement of the present assessment procedures by a withholding tax system would have the advantages of simplicity, certainty of liability and promptness of payment. For this and other reasons, its introduction could be expected to encourage overseas investment in Australia.

After examining the proposals carefully, the Government has decided to introduce legislation enabling non-resident investors to meet their liabilities for Australian tax on dividends by means of a withholding tax or, if they prefer, to have the present basis of assessment applied.

Under the proposed legislation, companies and other persons remitting dividends to non-residents will withhold tax at the appropriate rate and remit the amount retained in payment of the tax due. The withholding tax will be the final liability for Australian tax of the overseas shareholder unless he elects to account for the dividends in a return of income and pay tax on the present assessment basis. In that event, the non-resident investor will be entitled to a refund of any excess of the withholding tax over the tax ascertained by assessment.

When considering the rate of withholding tax, the Government had regard to the provisions of reciprocal taxation agreements that have been concluded with the United Kingdom, the United States of America and Canada. The withholding rate on dividends flowing to those countries will be 3s. in the £1 where this is appro priate under the provisions of an agreement. In other cases, the rate of withholding tax will be 6s. in the £1, but, as I have explained, it will be open to shareholders to have the present assessment basis applied.

The introduction of the withholding tax will not affect the taxation of company profits, which will continue to bear tax at the declared rates.

The withholding tax will not apply until 1st July, 1960, and it will not, therefore, have any effect upon the revenue for the current financial year.


A reduction of id. per gallon is being made in the customs duty on motor and aviation spirit. This will involve a revenue loss of £300,000 in the present financial year and £340,000 in a full year.

This change in the customs duty on motor and aviation spirit arises from the Government’s acceptance of a recommendation of the Tariff Board in its report on the petroleum refining industry that the protection to petroleum refining in Australia be reduced by id. per gallon.

The Government hopes that this reduction in duty will make possible a reduction in the price of petrol to the public.

The reduction in duty on imported motor and aviation spirit involves consequential alterations in duty on certain other items of the customs tariff where duty is imposed in order to protect the revenue derived from motor and aviation spirit.

Total Tax Concessions

All told, these tax concessions will involve a cost to revenue of £25,130,000 in a full financial year and £21,375,000 in 1959-60.

Total Taxation Revenue

Allowing for tax concessions, revenue from taxation is estimated to be £1,204,625,000, compared with £1,126,119,000 in 1958-59.

Taxation Committee of Inquiry

The Government has been giving thought to the broad structure of our taxation system. In his policy speech, last

October, the Prime Minister referred to the complexity of the taxation system and said that the Government would set up a competent and independent public investigation of the taxation laws. It is now proposed to establish a committee of inquiry, consisting of five members, to examine and report upon this extensive and difficult subject. The terms of reference of the committee are being studied and an announcement will be made in the course of these sittings of Parliament.

Postal, Telephone and Telegraph Charges

As part of the review the Government has made for Budget purposes of all major governmental activities, we have considered the trend of Post Office finances.

The Post Office is, of course, a great public utility - easily our greatest in point of the range, scale, and variety of its operations. We all know it to be a highly competent organization.

Growth of population and expansion of industry must mean that the Post Office will have to extend and improve its facilities in all directions. As a financial consequence of this effort, however, the Post Office has had to seek larger and larger amounts of money for capital expenditure. The facilities it provides are all costly, and they have become more costly as the costs of wages and salaries, materials and equipment have risen. Since 1945, the Government has provided some £400,000,000 for new buildings and equipment. Each year the requirement has tended to grow. Since the war, all the money for Post Office capital expenditure has been provided from the Budget. It has not been borrowed.

There is room for difference of opinion as to what the true capitalization of the Post Office should be in accounting terms, and so that the Government may have the best advice on that and other outstanding questions, we have recently decided to appoint a committee of competent outside people to study and report upon the basis on which the commercial accounts of the Post Office should be prepared.

When the Government has the advice of that committee we shall review the whole question of Post Office finances, and we hope then to be able to determine in precise terms what constitutes the capital of the Post Office, regarded as a business under taking, and what annual return’ upon it the Post Office should reasonably be required to seek.

In the meantime, however, it is clear beyond doubt that, since capital expenditure on the Post Office must continue to increase, the earnings of the Post Office should also be increased, not merely to meet the cost of its day-to-day services, but to provide something by way of return on the additional capital.

There are, of course, other important considerations. The costs of the normal day-to-day services rendered by the Post Office have been rising and no doubt will continue to rise. For example, since 1951, wage rates payable to Post Office employees have risen more than 50 per cent. On the other hand, Post Office charges have not been varied at all since 1956 and some charges have remained unchanged since 1951.

In view of the overall position, the Government believes it necessary to make this year certain increases in postal and telephone charges. These will be announced and explained in more detail in another place by the Postmaster-General. At the same time, he will be announcing certain important improvements in postal, and telephone services-

The first of the proposals contemplates, that first-class mail and other mail of letter form character posted within and for delivery within Australia will be carried by air without a special air mail surcharge wherever this will speed delivery. This will mean a vastly improved service and, to offset the loss in revenue reflected in the surcharge and the higher costs of the improved service, including additional payments to air.lines, it is proposed to increase the letter form rate from 4d. to 5d. for the first ounce.

Because of losses sustained in postal operations in recent years, due to increased costs not within the control of the Post Office, some of which have been absorbed by improved methods of handling and higher turnover, the Government has decided to increase certain other charges and adopt a simplified rate structure more in keeping with that employed by overseas countries. These changes will be announced by the Postmaster-General.

The second proposal provides for a completely new basic telephone policy which wil” give telephone- subscribers extended local call areas, and the advantages of automatic working over longer distances. This will involve an increasing degree of mechanization of the telephone service.

The mechanization plan and programme will’, provide for subscribers to call over much longer distances and to many more other subscribers for a local call fee. Exchanges are to be grouped in zones, based on community of interest, and calls within a zone and to adjoining zones will be treated as untimed local calls. In country districts the distance covered by a local call fee will be increased from 5 to about 30 miles on an average, providing the exchanges concerned are in adjoining zones. Calls between non-adjoining zones will be charged at trunk rates. Subscribers grouped in those zones adjoining metropolitan areas will share access at the local call fee with metropolitan subscribers. These important benefits will be available to subscribers immediately the new plan is formally introduced on 1st May, 1960, and it is proposed that a revised charging basis more appropriate to mechanized working be applied under both manual and automatic conditions of service.

This new charging basis will involve some simplification of the tariff system. At present, trunk line charges are divided into 22 separate categories depending upon the distance between the two exchanges concerned. For technical reasons, it is undesirable to continue the use of so many categories. It is intended ultimately to replace the 22 scales at present in force by eight and to adjust the charges therefor accordingly. As from 1st October this year the number of charging scales will be eleven, and those covering charges up to 25 miles will be abolished as from 1st May, 1960, when the full advantages of extended local call working will be available to the public.

From 1st October the charge for local telephone calls will rise from 3d. to 4d. As the average householder subscriber makes fewer than two calls per day, the cost to most householders of the additional Id. will certainly not be very large. lt is also proposed that there be some increases in charges for trunk calls and that telephone rentals be raised. Increases in telephone charges and telegraph charges are expected to produce an additional £12,700,000 in a full year and £7,300,000 this year.

The total additional revenue expected to accrue from increases in postal, telephone and telegraph charges is £17,800,000 in a full year and £11,100,000 in 1959-60.

Business Undertaking Revenue

After allowing for these adjustments, Post Office revenue in 1959-60 is estimated to be £119,800,000. Railway revenue is estimated to be £4,940,000 and revenue from Broadcasting and Television Services, £10,000,000. This makes total estimated revenue from business undertakings £134,740,000 compared with £116,896,000 in 1958-59.

Other Revenue

Revenue from the Territories is estimated at £3,433,000 and Miscellaneous Revenue: at £42,465,000.

Total Revenue

The estimates of total revenue in 1959-60 therefore become £1,385,263,000, which is an increase of £97,381,000 over actual revenue in 1958-59.

Other Receipts

Loan Raisings

To estimate loan raisings is difficult in any year and this year it is more than usually so. Last year total loan raisings in Australia and overseas were £209;000,000; but this must be regarded as exceptional. We did unexpectedly well in borrowing abroad - the net amount raised was £31,000,000 - and the new special bonds introduced during the year brought in £27,000,000. But there were also exceptionally large subscriptions to Commonwealth loans by trading banks, which were unusually liquid at that period. Moreover, the new short-term market institutions, which were establishing portfolios of securities, contributed heavily to Commonwealth loans. A considerable part of their funds was obtained from the trading banks.

It is not possible to judge with any real certainty the extent to which various factors will operate in the current financial year. After weighing all considerations, however, the Government has not felt justified in placing the estimate of loan raisings this year as high as actual raisings in 1958-59. It has, for budgetary purposes, adopted a figure of £190,000,000, compared with £209,000,000 last year, and it realizes that, in the event, £190,000,000 could prove to be somewhat high.

I should like to mention here that the Government has decided in principle upon a further innovation in public borrowing. It has for some time been considering the need to reduce the seasonal fluctuations which occur each year in the liquid assets of the banks and the public. These wide seasonal variations in the money supply are brought about by a combination of factors, including the temporary borrowings by the Government against treasury-bills to finance expenditures in advance of the receipt of revenues and proceeds of public loans, the seasonal flow of export proceeds, and the seasonal advances to primary producers financed by the Rural Credits Department of the Commonwealth Bank.

The Government believes that any action which substantially reduced the upswing and subsequent decline in liquidity would make a useful contribution to the efficient working of our financial system; With this in view we have decided to issue a new form of Commonwealth security to be called seasonal treasury notes. These securities, which will have a currency of three months, will be issued to the public during the period when liquidity is rising seasonally, and will be redeemed within the same financial year as liquidity declines. The new securities will be issued on a discount basis to give a return in line with other market rates of interest. Some of the details associated with this proposal have yet to be finalized but it is intended that issues of the securities will be commenced in the first half of the financial year. Since these notes will all be repaid before the end of the financial year, they will not of course add to the net amount obtained from public borrowings in the year.

Apart from revenues and public borrowings, the only other resources in sight to meet the cash expenditures of the Government are certain receipts of the National Debt Sinking Fund. It is estimated that the amount of such receipts which will be available for redemptions of maturing debt this year will be of the order of £46,000,000.

Total Estimated Receipts

Therefore, bringing together revenue, estimated at £1,385,263,000, loan raisings, estimated at £190,000,000, and Sinking Fund receipts available for redemptions, estimated at £46,000,000, it appears that the total cash resources available to the Government will be of the order of £1,621,263,000.

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If total cash resources for the year are £1,621,000,000 and total cash requirements are £1,682,000,000, the estimated overall deficiency for the year becomes £61,000,000.

It was mentioned earlier that the Commonwealth has undertaken, if necessary, to support the borrowing programmes of £220,000,000 for State works and housing in 1959-60 which were agreed upon by the Loan Council in June. Besides this we will need an amount, estimated at £7,000,000, for war service land settlement. The amount which the Commonwealth may need to contribute from its own resources to meet these commitments must remain uncertain. If, however, ordinary loan raisings reach £190,000,000 the Commonwealth would still need to find finance to the amount of £37,000,000. We are accordingly seeking an appropriation of that amount from Consolidated Revenue to the Loan Consolidation and Investment Reserve.

To enable this appropriation to be made without running the Consolidated Revenue Fund into deficit, defence expenditure to an amount of £37,000,000 will be charged to Loan Fund. As redemptions of maturing securities are estimated at £70,000,000 and the current receipts of the Sinking Fund available for meeting redemptions are estimated at £46,000,000, the current receipts of the Sinking Fund may fall short by some £24,000,000 of the amount required to finance redemptions. To meet these redemptions it is proposed to utilize some of the balances in that fund and in the Loan Consolidation and Investment Reserve. It will therefore be necessary to realize some of the investments held by these two funds.

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The Government has naturally given much thought to the question whether it should budget for a cash deficit in this financial year. In its Budget last year it provided for an estimated cash deficit of £110,000,000 and this was deliberately designed to support and stimulate the economy at a time when some slackness threatened. In the event, the realized deficit was much smaller, chiefly because loan raisings were quite exceptionally high. But since these greater loan raisings were due, in large part, to subscriptions derived, directly or indirectly, from trading banks, it is clear that the economy had the support of a good deal more bank credit than the reduced cash deficit itself would indicate. The economic prospects for this year, as we now see them, would certainly not justify any large additional stimulus to spending. The real question has been whether the cash deficit should be as large as the £61,000,000 for which the present estimates provide. The amount could, of course, be a good deal smaller if the Government were to add nothing to repatriation and social service pensions and benefits and to make no tax concessions. But that in itself raises issues of considerable difficulty. There is certainly a strong case for increasing the benefits concerned to the extent we propose. Similarly, there is a case for each of the tax concessions we have proposed. On the whole, therefore, the Government has decided that it ought to go ahead with these benefits and concessions in the current Budget.

This is not to suggest, however, that the Government regards cash deficits, financed with bank credit, as the normal and proper order of things in Commonwealth finances. On the contrary, it is very much concerned to ensure that we should get back as soon as we can to a position in which total cash receipts will at least balance total cash outgoings. This is particularly necessary if, as appears probable, our economy is moving into a phase of strongly rising demand. Accordingly, the Government has been giving close study to the general trend of Commonwealth finances.

Because the economy is growing, it is inevitable that there should be some addition to total expenditure each year. But there must be limits to the increase and from our study of the position we believe that the rate of increase need not be as great next year as it has been this year. We consider that expenditure can be kept within reasonable bounds without unduly restricting the provision of necessary services and facilities or curtailing the essential part which the Government has to play in the furtherance of economic growth.

In general, the Government believes that while we should not be afraid to profit from the strong position we have reached, we must be very careful not to jeopardize in any way the internal stability upon which this strength is founded.

In brief, our policy, as expressed in this Budget, is not aimed at giving any general boost to spending; we do not regard that as necessary at this stage. We have aimed rather at providing, on the one hand, some carefully chosen incentives to effort and enterprise and, on the other hand, a degree of restraint on certain tendencies which, if they become too exuberant, could undermine stability.

For while expansion of the economy is our objective, and while we have been prepared to take strong measures and, at times, considerable risks to promote expansion, it is our belief that expansion must be founded upon a secure state of internal stability. It is obvious that rising costs could throw the forward plans of industry all astray, retard the growth of exports and, by forcing up public expenditures, set us heading not for tax reductions but for tax increases. The emphasis we continue to lay on the need for internal stability is no mere platitude; it is a statement of reality learned from hard experience.

The Budget has been directed to the twin purposes of expansion and stability. It has also sought to express a spirit of social justice to all sections of the community and to provide fresh incentive for future national progress.

Debate (on motion by Senator 0’Flaherty’ adjourned.

Senate adjourned at 9.13 p.m.

Cite as: Australia, Senate, Debates, 11 August 1959, viewed 22 October 2017, <>.