Senate
16 August 1960

23rd Parliament · 2nd Session

  1. Senate
  2. 23rd Parliament
  3. 1960

The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers.

page 3

ASSENT TO BILLS

Assent to the following bills reported: -

Appropriation Bill (No. 2) 1959-60. Apppropriation (Works and Services) Bill (No. 2) 19S9-60. Parliamentary Proceedings Broadcasting Bill

Broadcasting and Television Bill 1960. Supply Bill 1960-61.

Supply (Works and Services) Bill 1960-61. Air Navigation Bill 1960. Airports (Surface Traffic) Bill 1960.

page 3

QUESTION

CONSTITUTIONAL REVIEW COMMITTEE

Senator McKENNA:
TASMANIA

– I direct a question to the Minister representing the AttorneyGeneral. Is the Minister in a position to indicate the results of any consideration by the Government of the reports of the Constitutional Review Committee? If he is not, will he request the Attorney-General to make a statement on the matter at an early date?

Senator GORTON:
Minister for the Navy · VICTORIA · LP

– Mr. President. I am not in a position to state any results of the consideration of the Constitutional Review Committee’s report. The Leader of the Opposition will realize that it was a very lengthy and detailed report covering a great deal of ground and containing within itself a number of dissident minority reports which would require a good deal of consideration. I do know that the matter is under active consideration by the AttorneyGeneral, and I am sure that he will make a statement as soon as he has reached a decision on the matter.

page 3

QUESTION

CANBERRA

Senator McCALLUM:
NEW SOUTH WALES

– Has the Minister representing the Minister for the Interior read paragraph 51 and also recommendation 56 of the report of the Senate select committee on Canberra, which recommend that Westbourne Woods be not used as a golf course but be retained as a semi-woodland public reserve? Will the Minister ask his colleague to consider this recommendation and then make a statement to the Parliament concerning the future use of Westbourne Woods?

Senator Sir WALTER COOPER:

– I have read the report that the honorable senator has mentioned, and I should like to say that I think it is a very excellent report. The question that the honorable senator has asked will have to go before the Minister for the Interior himself for decision. 1 shall be very glad to bring the matter to his notice and ask him to consider it.

Senator VINCENT:
WESTERN AUSTRALIA

– I should like to ask the Minister representing the Minister for the Interior a question which is supplementary to the question that was asked by Senator McCallum. Has consideration yet been given to the establishment of a botanic garden in Canberra? If the matter has been considered, when is the project likely to be commenced, and what will be its scope?

Senator Sir WALTER COOPER:

– I shall be pleased to direct my colleague’s attention to the question.

page 4

QUESTION

UNEMPLOYMENT

Senator BENN:
QUEENSLAND

– I wish to ask the Minister who represents the Minister for Labour and National Service in this chamber a question. Has he been informed that there will be considerable unemployment in central Queensland, especially at Rockhampton and Gladstone, within a period of two weeks, due to the termination of the killing season at two meatworks? Will the Minister inform me what proposals, if any, his Government has in hand to relieve the unemployment, which is expected to continue until March, 1961?

Senator GORTON:
LP

– I am not able to say whether the Minister for Labour and National Service has been informed of the expected, not the actual, unemployment to which the honorable senator opposite has referred. The latest unemployment figures for Australia generally indicate that in all States there are more vacancies than there are people to fill them. If, in this case, a particular area may be affected, I am sure the Minister will do all he can to see that the difficulty is overcome.

page 4

QUESTION

FROZEN FOODS

Senator LILLICO:
TASMANIA

– I ask the Minister for Customs and Excise the following questions: Is it correct that imports of canning or quick frozen peas from the United States of America are allowed into Australia duty free? Are quick frozen peas being imported from New Zealand? Is the firm, International Canners Proprietary Limited, at Ulverstone, of which Mr. M. G. Barker is general manager, a large importer of quick frozen peas from New Zealand? Is it not a fact that the primary producer has received from the processors since 1945 an increase of only one halfpenny per lb., or 10 per cent, in fifteen years? With regard to the proposed new potato processing factory at Ulverstone, which is reputed to be the only one of its kind that there will be in Australia, is it customary for a Commonwealth Government to guarantee adequate protection before a factory is actually established? With regard to the statement that plans to erect a new £250,000 quick frozen vegetable processing plant at Ulverstone would not be proceeded with until the Commonwealth Government gave reasonable protection to the industry, is it not correct that frozen pea processors throughout Australia have sufficient confidence to be spending at present large sums to increase their capacity, including £250,000 at Devonport, where contracts with producers are expected to be quadrupled? Is it correct to say that the present Commonwealth Government stands for adequate protection for primary producers and will see to it that this policy is given effect as conditions warranting increased protection arise?

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

– The honorable senator gave me notice of this question. This is a matter regarding which there has been some controversy in Tasmania during the past week or so. In reply, I shall quote from the findings of the Tariff Board of 10th September, 1958, on the subject of vegetables and frozen peas. The Tariff Board recommended -

That the rate of duty on fresh frozen peas and beans at present classifiable under Tariff Item 102 … be ls. 3d. per lb. less 66) per cent, of the f.o.b. value.

That means that protection is given whenever the price at which the commodity is imported into Australia falls below ls. 10id. per lb. plus landing charges, which works out at approximately 2s. 3d. per lb. It means that the lower the price of the imported peas, the higher is the duty paid, and the industry is protected if that price falls below 2s. 3d. per lb. It is not quite correct to say that peas can enter Australia free of duty. The protection recommended by the Tariff Board is governed by the condition that the peas shall not enter Australia at a price below ls. 10±d. per lb. plus landing charges. The statement that they are allowed to be imported duty free gives the impression that no duty is payable under any .circumstances. It is not payable if the price is approximately 2s. 3d. per lb. The Tariff Board believes that is a climate in which the industry in Australia can progress with profit. At the same time it removed any suggestion that there could be any cartel in Australia which would not have to meet competition from overseas if the price got beyond that which was thought to be fair and equitable and at which the Australian industry could progress with profit.

The answer to Senator Lillico’s first question is that there is a duty of ls. 3d. per lb. less 66$ per cent. on the value, which brings the price to approximately 2s. 3d. per lb., and this is the figure at which some processors in Australia have been selling in bulk to cafes, hotels and other bulk purchasers for some considerable time. Other processors have charged a little more, but I repeat that some processors have been selling at a price approximately equal to the cost of importing peas into Australia. That explanation should dispose of any suggestion that there is any foundation in the assertion that peas are being admitted duty free.

I have kept a very close check of importation into Australia over the last eighteen months, and although the figures I have before me were obtained four or five days ago, the fact is that there has been no importation of peas into Australia in the 4-oz., 6-oz. and 8-oz. domestic packs from the United States of America. We have been unable to trace any shipment of domestic packs. Most importations have been of peas in bulk which I understand have been used by the processors who have sold the whole of their own output and are importing these peas to keep their own brands on the markets until the new season’s peas are available in Australia.

Part of Senator Lillico’s question dealt with the importation of peas from New Zealand. He mentioned the firm of International Canners Proprietary Limited, of Ulverstone. He has suggested that this firm is importing peas from New Zealand. I have no information on this matter at all. I can only say that International Canneries at Ulverstone is a subsidiary of Grocery and General Merchants Limited to which the Tariff Board refers on page six of its report as being an importer of fairly large quantities of frozen vegetables from New Zealand. I have no record of any recent importations. Senator Lillico asked whether it was a fact that the primary producer had received an increase of only one halfpenny per lb. or 10 per cent, in the price .received from the processors in the fifteen years since 1945. I understand that this is correct. I did read in the Tasmanian press a claim by one processor that he had been responsible for keeping down the cost of this product in Australia. I .think the primary producer has been the one responsible for keeping down costs, for he has received an increase of only one halfpenny per lb., or 10 per cent, in fifteen years. In those circumstances, the primary producer has every right to claim a great deal of the credit for keeping costs down during that period.

The honorable senator asked about the products of a proposed potato processing factory at Ulverstone. This industry is extremely important to the economy of Tasmania. Senator Lillico has asked whether it is customary for the Commonwealth Government to guarantee an industry adequate protection before a factory is actually established. I point out that his question refers to what one might almost call a threat from the honorable member for Braddon who said in Tasmania that if protection were not given to this factory by 12 o’clock last Monday week the factory would not start operating. I understand that a telegram was actually sent to the Government stating that the protection requested must be accorded by 12 o’clock last Monday week or this new industry would not start. Such pressure tactics as that get nowhere. A statement of that sort is really too infantile for one to take cognizance of it.

It is not usual for tariff protection to be granted a new industry until the industry has been established and its cost structure has been examined and reported upon by the Tariff Board. That is the course that has been followed by every government, irrespective of party affiliation. Every government insists that a new industry seeking protection shall establish itself and determine its costs before going to the Tariff Board. The board conducts a fair, impartial and independent hearing and recommends to the Government the quantum of protection, if any, that is necessary to sustain the industry. That is the procedure that is followed by the present Government.

The fifth question related to the statement that plans to erect a £250,000 quickfrozen vegetable processing plant at Ulverstone would not be proceeded with until the Federal Government gave reasonable protection to the industry. I suggest that that is a matter of judgment. Other firms have indicated, by statements in the press, that they are spending £250.000 to quadruple their output because there is, in fact, a rapidly growing market in Australia for frozen green peas. So if one firm does not start operations for a certain reason and another firm does, the firm that does start and quadruples its output will gain the benefit of the rapidly increasing market. The course that is taken depends entirely upon judgment. I know which judgment I would back. I would be on the firm at Devonport that will spend £250,000.

Senator Lillico:

asked whether it was correct to say that the present Government stood for adequate protection for primary producers and would see that this policy was given effect as conditions warranting increased protection arose.

Senator Hendrickson:

– It is a good thing that Senator Lillico told you that he intended to ask his question.

Senator HENTY:

– If the honorable senator who interjects had been reading the Tasmanian press, he would have seen the awful nonsense that has been written from a party-political viewpoint by the honorable member for Braddon and others, and he would understand what inspired this question. It is time that an opportunity was taken to give the facts to the Senate. It is quite correct to say that the present Government stands four-square for the view that primary producers are entitled to adequate tariff protection to enable them to market their products at an economic price. My colleague, the Minister for Trade, is always ready to examine requests for increased tariff protection, where an industry can present a prima facie case indicating that a further examination by the Tariff Board of the industry’s needs in the light of present day circumstances is warranted.

The Department of Customs and Excise is keeping a very close check on imports of this product, because this industry is important to Victoria and especially to Tasmania. This check is being conducted now almost on a daily basis.

Senator McKENNA:

– I direct a supplementary question to the Minister for Customs and Excise. I understood him to say that the price per lb. at which frozen peas were retailed in Australia was approximately 2s. 3d. If he did say that, will he indicate the source of his information? The advice that I have is that the price runs to 3s. lOd. per lb. If goods can be imported at a landed cost of 2s. 3d., there is an obvious opportunity to undercut a firm selling similar goods at 3s. lOd. I am told that the price of a 6-oz. domestic pack is ls. lid., of a 10-oz. pack 3s., and of a li-lb. pack 5s 9d. The last figure works out at about 3s. lOd. per lb. Will the Minister state the source of his information that the selling price in Australia is 2s. 3d. per lb., and will he say whether, if the figures I have cited are correct, he still regards the duty as being adequate to protect the local product?

Senator HENTY:

– The honorable senator has quoted prices for 6 oz. and 10 oz. domestic packs. I thought I made it quite clear in my answer to Senator Lillico’s question that no 6-oz., 8-oz. or 10oz., domestic packs have arrived in Australia from the United States.

Senator McKenna:

– But from New Zealand?

Senator HENTY:

– There has never been any query in regard to New Zealand. The query has arisen in respect of the United States. No domestic packs have arrived from the United States, and we are maintaining a day-to-day check to see whether any such domestic packs in fact arrive here.

The bulk peas arrive in 55-lb., 50-lb. and 20-lb. containers. The Dewcrisp company, of Scottsdale, gave me a selling price of 2s. 3d. per lb. in the bulk containers. Another firm that has been mentioned, one in Victoria, gave me a price of 2s. 4d. per lb., and the Birds Eye company, of Devonport, gave me a price of 2s. 6d. per lb. in bulk containers when sold to restaurants and so on. Those are the actual figures and may be compared with the figures for peas coming in from the United States. The matter of domestic packs, which the Leader of the Opposition has raised, is an entirely different one altogether. It can be examined only if and when such packs arrive from the United States. As I have said, so far we have no evidence that they are arriving.

page 7

QUESTION

SOVIET POLICY ABROAD

Senator McMANUS:
VICTORIA

– Is the Minister representing the Minister for External Affairs aware that the Estonian, Latvian and Lithuanian, communities in Australia recently commemorated the twentieth anniversary of Soviet aggression against the liberty of their countries? ls the Minister also aware that those three communities have demanded the withdrawal by the Soviet Union of its military, police and administrative personnel from the Baltic countries? In view of the United Nations’ action to secure the removal of Belgian troops to ensure the independence of the Congo, which action the Soviet Union has supported even to the extent of threats, does the Australian Government believe that the Soviet Union could and should prove its sincerity and unselfishness by removing its troops from all subject territories, including the Baltic States, thus ensuring for them the same independence as is sought for the Congo? In default of such action by the Soviet, are we entitled to reject that country’s bona fides as a supporter of selfdetermination?

Senator GORTON:
LP

– In answer to the first part of the honorable senator’s question, I state that I am aware that the Estonian, Latvian and Lithuanian communities here have recently mourned - not celebrated - the twentieth anniversary of Russian aggression against their countries. I am also aware that they have demanded the withdrawal from their countries of the Russian forces of occupation and have called upon the western world, and the conscience of the western world, to take all peaceful methods possible to have withdrawn from their countries, police, troops and administrative personnel. In regard to the question about the United Nations’ action in the Congo, I can only answer by directing the honorable senator’s attention to the sharp distinction between the Russian attitude in the matter he brings up and the Russian attitude in the case of Hungary.

In the case of the Congo, as the honorable senator has said, Russia, pursuing her ordinary policy of attempting to exacerbate any inflamed spot in the world, threatened to shoot her way into Katanga. In the case of Hungary, Russia made it clear that she would shoot to prevent, not United Nations troops, but United Nations observers and the Secretary-General of the United Nations, from entering that country in response to a resolution by the General Assembly of the United Nations. In view of these tacts, 1 think we are entitled to have grave doubts - and the Australian Government does have grave doubts - as to the sincerity of Russia’s claim to support self-determination.

page 7

QUESTION

TOURIST INDUSTRY

Senator SCOTT:
WESTERN AUSTRALIA

– I wish to direct a question to the Leader of the Government in the Senate. Did he notice the leading article in the Sydney “ Daily Telegraph “ of last Monday, headed “Australia’s Big Chance for Tourists “? The article stated that Mr. Frank Johnson, of World Travel Head-quarters, and Mr. Roland Hill, of American Travel Head-quarters, had pointed out that the internal troubles in Cuba and Africa could divert American tourists to Australia. Mr. Hill said that the greatest single opportunity that Australia had ever had would present itself in November, when the world’s leading travel promoters would meet in Honolulu. In view of the urgent need to increase our income from overseas, will the Government consider offering Australia as the host country for the World Travel Congress to be held in 1963?

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

– I think that Senator Scott’s suggestion merits close consideration. I know of the conference that is to be held in Honolulu, but I do not know what arrangements have been made for the venue of the subsequent conference. I am sure that Australia has many advantages to offer, and I shall ensure that the proposal that Senator Scott has made will be brought to the attention of the appropriate Minister.

page 7

QUESTION

ROAD SAFETY

Senator HANNAFORD:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Shipping and Transport. Is it a fact that the present Commonwealth grant for road safety is £150,000 per annum, of which 40 per cent., or £60,000, is allocated to the central administration of the Australian Road Safety Council, the remaining 60 per cent., or £90,000, being distributed amongst State road safety organizations? Is it correct that at a recent meeting of the Australian Transport Advisory Council an announcement was made by the Commonwealth Minister for Shipping and Transport that as from 1st January, 1961, a change will be made in the allocation, reducing the States’ share from £90,000 to £50,000, and increasing the grant to the central administration of the Australian Road Safety Council from £60,000 to £100,000? What is the reason for the proposed change? Was the proposed alteration of the allocation of these funds condemned by all the State Ministers for Transport? In view of the fact that the report of the Senate Select Committee on Road Safety is to be presented shortly, would it not have been reasonable to have awaited the committee’s findings before contemplating such drastic and fundamental changes?

Senator PALTRIDGE:
Minister for Civil Aviation · WESTERN AUSTRALIA · LP

– I am aware that discussions have taken place between the Commonwealth Minister for Shipping and Transport and the six State Ministers for Transport on the financial allocation made by the Commonwealth for this purpose. I am not aware of the outcome of that conference, but I should like to take this opportunity to explain to Senator Hannaford, and to the Senate generally, that the sum which goes to the central administration - which is the Commonwealth component in this Commonwealth-State set-up - is not used for narrow Commonwealth purposes only, but is spent in the provision of material which is distributed to the States and used by them. The money is spent, as I recall, on the acquisition of films and other material used in road safety education. I take this opportunity to tell the Senate that lest it should be imagined that the Commonwealth’s portion of the vote is not used for the general purpose of road safety throughout the Commonwealth.

As to the other parts of the question, their answers require a more detailed knowledge than I have at the moment. I can only tell the honorable senator that I will bring his question to the notice of Mr. Opperman and obtain a detailed answer.

page 8

QUESTION

ALUMINIUM

Senator O’BYRNE:
TASMANIA

– My question is directed to the Minister for National Development. In view of the rapidly expanding demand throughout the Commonwealth for aluminium and the need to conserve declining overseas balances, will the Minister inform the Senate whether, in conjunction with the speeding up of development of the bauxite deposits at Weipa, in northern Queensland, any plans exist for expanding the production of aluminium in this country, particularly in Tasmania? Further, has the Minister any information relating to negotiations between the British Aluminium Corporation and the Commonwealth Government for the sale of the Commonwealth’s interest in the aluminium plant at Bell Bay in Tasmania?

Senator SPOONER:
LP

– The answer to the first part of the honorable senator’s question is that at present a programme is in existence for the expansion of the productive capacity of the Bell Bay plant from 12,000 tons to 16,000 tons per annum. The Australian Aluminium Production Commission has retained the services of a Swiss firm, which will give technical advice in connexion with the increased production. That programme is going ahead. As to the second part of the honorable senator’s question, I have no information that I can give him at the moment.

page 8

QUESTION

CIVIL AVIATION

Senator LAUGHT:
SOUTH AUSTRALIA

– Can the Minister for Civil Aviation say when the proposed French jet air service from Australia to Tahiti will commence? Will the Minister inquire whether such a service, or an Australian service using the jet airport on Tahiti, could fly on to South American countries, thus providing for the first time a direct service between Australia and South America?

Senator PALTRIDGE:
LP

– I cannot say with any accuracy when the French service from Sydney to Tahiti is to commence. One problem’ at the moment is that the airport on Tahiti is not yet able to carry the biggest aircraft likely to be used. One of the rights obtained by Australia at its recent conference with France was for a service to Tahiti. It is anticipated that when the airport on Tahiti is completed, Australia’s airline - Qantas - will operate a service to Tahiti and from there a service to Honolulu to link with the service to North America.

Australia has also obtained from France exit rights from Tahiti enabling Qantas to land in a number of South American republics, but to date no negotiations have been conducted with any South American republic to obtain landing rights there. If and when such landing rights are considered to be of commercial or other value to the Commonwealth, negotiations will be commenced.

page 9

QUESTION

EMPIRE GAMES AT PERTH

Senator TANGNEY:
WESTERN AUSTRALIA

– I ask a question of the Minister representing the Treasurer. Is the Minister aware that the Empire Games are to be held in Perth in 1962 and that the organizing committee of the games ‘has invited subscriptions from the public to assist in the staging of the games? Will the Minister consider allowing contributions to this worthy fund to be claimed as deductions for income tax purposes?

Senator PALTRIDGE:
LP

– The honorable senator is probably aware that representations along the lines indicated by her were made by the Western Australian committee responsible for financing and staging the games. A reply was given by the Treasurer last week to the effect that he could not accede to the request made by the committee. In doing so, he pointed out that a similar application in connexion with the holding of the Olympic Games at Melbourne had been refused, and that it had not been the practice of, and the precedent had not been set for, the Commonwealth to support appeals such as this by way of allowing donations as income tax deductions. He went further and pointed out that the Commonwealth supported by direct grants both the Olympic Games and the Empire Games, and that further assistance for the Empire Games had been given by way of special treatment of housing finance to the Government of Western Australia.

page 9

QUESTION

RAIL TRANSPORT

Senator BRANSON:
WESTERN AUSTRALIA

– My question is directed to the Minister representing the Minister for Shipping and Transport. Can he say whether it is correct that the transcontinental trains operating between Perth and Adelaide are booked out from 20th August to the middle of September? As these dates cover the school holidays and the wild flower season in Western Australia, will the Minister’s colleague consider putting on extra trains to cater for the school holiday traffic?

Senator PALTRIDGE:
LP

– I will bring the honorable senator’s question to the notice of my colleague, Mr. Opperman. It is not unusual, of course, at this time of the year for trains to be fully booked. I am not aware that there are any persons waiting for bookings, but if they are it appears, as the honorable senator suggests, that the trains are fully looked. I further point out that it is the practice of the Commonwealth Railways Commissioner to put on special trains as required, and this year something of a departure from the normal is taking place inasmuch as the commissioner is putting on a special train with special tourist class accommodation to take visitors from the eastern States to Western Australia to give them the unique opportunity - if I may so describe it - of having a look at the Nullarbor Plain, which .at this time of the year is sometimes in flower, and particularly the wild flower areas of the State. I am informed that that special train, known as the Wild Flower Special, is proving a great success.

page 9

QUESTION

IMPORTATION OF MOTOR VEHICLES

Senator AYLETT:
TASMANIA

– I desire to direct a question to the Minister for Customs and Excise. In view of current rumours that Australia will be inundated by the wholesale importation of second-hand American cars in the near future, will he inform the Senate whether any applications have been received for permits to import such vehicles? If applications have been received, has favorable consideration been given to them? If favorable consideration was given, or is to be given to them, what duty, if any, will be imposed on the vehicles? Will it be on the basis of the price of these second-hand American cars, or on the model, year, &c?

Senator HENTY:
LP

– The question comes within the jurisdiction of my colleague, the Minister for Trade. As the honorable senator will be aware, the present import licensing arrangements in respect of North American cars will continue until 1st

October next. Meanwhile, I know that my colleague, the Minister for Trade, has this problem under review and in due course, doubtless, he will make a policy announcement in relation to it.

page 10

QUESTION

STEEL

Senator PEARSON:
SOUTH AUSTRALIA

– I preface a question to the Minister for National Development by saying that there is apparently a shortage of steel for various uses in South Australia. Farmers are complaining that they are unable to purchase steel fencing posts, whilst manufacturers, contractors and others complain that they suffer from a shortage of other grades of steel. Can the Minister say whether the shortage is general in all States, or whether it is a temporary phase due to some unforeseen circumstances? Can he express an opinion on how long the present shortage is likely to continue?

Senator SPOONER:
LP

– 1 think that the answer to Senator Pearson’s question, in general terms, is that as a result of the growth of the Australian economy and the rapid development that is taking place the Australian steel industry, despite great expansion, finds itself somewhat short of particular shapes and sizes of steel. I do not know the circumstances of the particular matter to which Senator Pearson refers, but I do know that it is the policy of the Broken Hill Proprietary Company Limited to ensure that available supplies are delivered as equitably as possible over the whole of Australia. It is that company’s policy, when shortages occur, to adjust its manufacturing programme as quickly as it can in order to pick up the lag in any particular direction. This is not an easy task for the steel industry, because it gets surpluses of some particular products and shortages of others. There are times when the industry has to export some of its surpluses because it cannot close down its plant. The industry cannot regulate its output as closely as that. There are times when the industry has to export surpluses of some shapes of steel, and at times there are shortages of certain other products. But I think it will be agreed that the industry is quick off the mark to pick up deficiencies as soon as possible.

Senator O’BYRNE:

– I wish to ask the Minister for National Development a question which is supplementary to the one that was asked by Senator Pearson. In view of the fact that the Broken Hill Proprietary Company Limited has a 100 per cent, monopoly of steel production in this country and almost a monopoly - 85 per cent. - of the fabrication of steel, and also in view of the fact that the company recently divulged that its profit for the last twelve months was in the vicinity of £30,000,000, will the Minister confer with his Cabinet colleagues on the subject of subsidizing a competitor for the company? The object would be to meet the Australian needs of steel and develop the very lucrative export trade which would exist if the firm would do its job for the Australian people and expand1 the steel industry to its utmost capacity.

Senator SPOONER:

– Although we are a courageous Government, I do not think we would be sufficiently courageous to go to the Australian people and advocate a policy such as has been suggested by the honorable senator. I subscribe to the school of thought that takes a good deal of pride in the way that the Broken Hill Proprietary Company Limited has developed the steel industry in Australia, and I myself take a good deal of pride in the extraordinary expansion of the Australian steel industry that has taken place and in the fact that we in Australia can manufacture or produce steel more cheaply than most other countries in the world.

Senator O’Byrne:

– The company has a monopoly in that field.

Senator SPOONER:

– There is no monopoly. It is quite competent for anybody to go into operation against that company. There is no restriction now on the importation of steel. If an overseas enterprise can sell steel in Australia more cheaply than the Broken Hill Proprietary Company Limited the doors are wide open for it to do so. If any firm has the necessary capital, skill and know-how, it can start in opposition to the company.

page 10

QUESTION

SHIPPING

Senator WRIGHT:
TASMANIA

– My question to the Minister representing the Minister for Shipping and Transport relates to the recent dislocation of coastal shipping in Australia. Will the Minister inform the Senate of the number of coastal ships at present immobilized for want of crews? I ask the Minister whether, in his opinion, the recent strike and the present starvation of ships of crews have an industrial base or whether they represent simply an exercise in Communist tactics. I ask him also to comment upon the suggestion that there is significance in the synchronization of the Australian dislocation and the difficulties experienced with English shipping in the United Kingdom.

Senator PALTRIDGE:
LP

– The question relates more particularly to the portfolio administered by my colleague, the Minister for Labour and National Service, and I shall be pleased to refer it to him. Addressing myself particularly to that part of the question which deals with the reasons underlying the hold-up, I suggest to Senator Wright, with the greatest goodwill in the world, that he has to do no more than exercise his own very fertile imagination.

page 11

QUESTION

KANGAROO MEAT

Senator WILLESEE:
WESTERN AUSTRALIA

– I ask the Minister representing the Minister for Primary Industry: Has his attention been directed to the wide and unfavorable publicity given in Germany to the importation of kangaroo meat from Australia. It has been alleged that there have been, to say the least, foreign bodies present in the meat. Is it a fact that there is no surveillance of kangaroo meat exported from this country? Although this may primarily be a matter for State health departments, does the Minister think that, as our export trade may be affected, the Department of Primary Industry should interest itself in the surveillance of all meat exported, whether it be kangaroo meat or any other kind of meat?

Senator GORTON:
LP

– I know that the Department of Primary Industry normally passes for export such meat as beef carcasses, lamb and mutton. I do not know whether the department examines kangaroo meat, or how much kangaroo meat is exported. If there appears to be a significant market for this meat and if that market requires meat of a certain standard, I shall pass on to the Minister for Primary Industry the honorable senator’s suggestion.

page 11

QUESTION

IRON ORE

Senator HANNAFORD:

– Can the

Minister for National Development tell the Senate anything about the Mount Constance Range iron ore deposits in Queensland? I understand that they are in the vicinity Of the Gulf of Carpentaria. Are these deposits being investigated or in any way developed? Would not the development of the deposits require port facilities in the Gulf of Carpentaria? If such facilities were eventually provided, would not they provide a valuable outlet for minerals mined in the region of Mount Isa, thus removing the necessity for great expenditure on the Mount Isa to Townsville railway line?

Senator SPOONER:
LP

– I hesitate to attempt to give a description of the Mount Constance ore deposit off the cuff, particularly as I have been away for a couple of months and as I know that prospecting has been going on during that time. My recollection is that the deposit is now thought to be very large, although not of the high grade of the South Australian deposits. It may be that it is a little too early to say that. Prospecting is quite a lengthy process. Drilling will take place, and that will take some considerable time. My understanding of the situation is that the outlet for these deposits would be a port on the Gulf of Carpentaria, but that port would be too remote to link tip with Mount Isa. I have heard that the company concerned with the licence or lease has given some thought to the building of a new port on the gulf.

page 11

QUESTION

POSTAL SERVICES

Senator KENNELLY:
VICTORIA

asked the Minister representing the Postmaster-General, upon notice -

  1. Relative to the Postmaster-General’s reply on 6th April to my question regarding the alleged non-delivery of mail for the Wealthwords Competition conducted by “ The Herald “, Melbourne, has the Postmaster-General seen the comment on page 5 of “The Herald”, dated 6th April, that “The Postmaster-General in saying that there was no evidence that Wealthwords mail was delayed in the post office leaves the inference that it was delayed somewhere else “ and the subsequent categorial statement that “This is not so . . .”?
  2. In view of the newspaper’s comment, and the desirability of the large number of persons who subscribe to the competitions being satisfied that any entries they might submit will be delivered safely in time, will the PostmasterGeneral reconsider his decision not to table th« findings of the departmental inquiry?
Senator SPOONER:
LP

– The PostmasterGeneral has. furnished the following reply: -

I have nothing to add to the reply furnished to the honorable senator on April 5th last when the position in relation to the alleged non-delivery of mail for the Wealthwords Competition conducted by “ The Herald “, Melbourne, was fully explained.

page 12

QUESTION

EDUCATION IN THE AUSTRALIAN CAPITAL TERRITORY

Senator HENDRICKSON:

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

  1. Are the important changes in the secondary education system in New South Wales, which are now about to take place as a result of recommendations made to the New South Wales Government three years ago and which will affect the intermediate and leaving certificate examinations, to be applied to schools in the Australian Capital Territory?
  2. If so, when did the department decide to make the changeover?
  3. In view of the fact that children are coming from all the Australian States to Canberra, is not the time long overdue for the setting up of a new education authority in Canberra completely divorced’ from any State administration?
Senator Sir WALTER COOPER:

– The Minister for the Interior has furnished the following reply: - 1 and 2. The Department of the Interior has not been advised that important changes are about to take place in the secondary education system in New South Wales. When such advice has been received the effect of such changes will be considered in consultation with the New South Wales Department of Education.

  1. No.

page 12

LEAVE OF ABSENCE

Motion (by Senator Spooner) - by leaveagreed to -

That Senator Maher be granted leave of absence for two months to attend the Inter-Parliamentary Union Conference at Tokyo.

Motion (by Senator McKenna) - by leave - agreed to -

That Senator Cooke be granted leave of absence for two months to attend the Inter-Parliamentary Union Conference at Tokyo.

page 12

MACKAY AIR DISASTER

Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP

– by leave - Honorable senators are aware that since the Parliament adjourned a Trans-Australia. Airlines airliner, a Fokker Friendship, VHTFB, crashed near Mackay, Queensland, with the loss of the 29 people aboard. This tragedy, on 10th June, ended eightandahalf years of fatality-free operations by Australian domestic airlines.

I have a responsibility to the Parliament for air safety, and I take this opportunity to report formally to the Senate the developments that followed the disaster. A public inquiry will be held into the accident. This will begin in Brisbane on 4th October. Mr. Justice Spicer, the Chief Judge of the Commonwealth Industrial Court, will be chairman of the board of inquiry. They are -

Captain R. J. Ritchie, Director of Technical Services for Qantas Empire Airways. Captain Ritchie has flown some 10,500 hours with Qantas and has a wide background of aviation experience.

Dr. F. S. Shaw, Superintendent, Structures Division of the Aeronautical Research Laboratories, Melbourne. Dr. Shaw is recognized as a world authority on aircraft structures; and

Captain J. Murray, a check and training captain with MacRobertsonMiller Airlines of Western Australia, who has over 12,000 hours flying experience including current experience on Fokker Friendships.

It is in the public interest and also the interests of the aviation industry that every aspect of this tragedy should be openly and fully investigated, and that is the purpose of the Board of Inquiry.

A thorough accident investigation into the disaster was initiated within minutes of the crash. This technical investigation is still in progress, and involves difficult and detailed tests and research work. Air safety investigators of the Department of Civil Aviation will have completed their task before the inquiry begins. I visited Mackay a few days after the accident to see for myself the search and salvage operations. Through the wholehearted co-operation of the Royal Australian Navy, the aircraft wreckage was located and salvaged from about 40 feet of water. At one stage, 30 technical experts were in Mackay taking part in the investigation. This operation has been one of the most intense search, salvage and investigation efforts in the history of Australian civil aviation.

The inquiry will begin in Brisbane. In the opinion of Mr. Justice Spicer, Brisbane is the most suitable city in which to conduct at least the major part of the inquiry. If it became necessary, or more convenient, to conduct some part of the inquiry in Mackay, Mr. Justice Spicer would have no hesitation in making the necessary arrangements. I am sure all senators will join me in expressing the sincere sympathy of the Senate to all who lost loved ones in this disaster.

page 13

QUESTION

RIVER MURRAY WATERS

Debate resumed from 5th May (vide page 817, vol. S.17), on motion by Senator Laught -

That the following paper: -

River Murray Waters Act - Annual Report of the River Murray Commission, together with statements of gaugings and diversions, for year 1958-59- be printed.

Senator MATTNER:
South Australia

– The residents of South Australia appreciate the work of the River Murray Commission because they realize that an assured supply of water from the Murray River is vital to the future development and progress of that State. In the early days of South Australia’s development, the Murray and its tributaries were looked upon as lines of communication and a means for the conveyance of goods and the produce from areas adjacent to and beyond the river itself. In those days, navigation was of first importance and irrigation was considered to be a secondary matter. Later, the importance of irrigation became apparent, but the diversity of interests of the various States prevented any agreement being reached with respect to the vesting of the river Murray and the diversion and use of the waters flowing down it. It was not until the year 1914, following a report by a conference of interested engineers in 1913, that agreement was reached in connexion with this most controversial matter.

The River Murray Agreement saw the beginning of a new and prosperous era for the Murray River basin. I sincerely trust that the people of Australia as a whole appreciate, just as we in South Australia do, the work of the River Murray Commission and give all due credit to the members of that body who directed their energies towards furthering the development of this great part of Australia. We know that vast areas of Australia enjoy only a low rainfall and that Australia has few rivers of any great volume. Strangely enough, in this country of relatively low rainfall and very few great rivers, the people generally are not greatly concerned with the storage of water, yet water should be conserved wherever that is possible on this great continent. The storage of water and the harnessing of rivers do make for great increases in primary production. The harvesting of water pays handsome dividends wherever it is carried out. In those circumstances, it is little wonder that in the very early days men looked to the Murray and its tributaries as a source of water for storage.

The Murray and its tributaries make up the largest river system in Australia. The first indication of an inland water system in Australia was the discovery of the headwaters of the Lachlan and Macquarie rivers by George William Evans in 1815. In 1824, the explorers Hume and Hovell were the first white men to see the Murray River. They saw it at a point downstream near where the Hume Reservoir now stands. I suppose it is history to almost every boy and girl in Australia that Captain Sturt and a small party of men rowed a boat down the Murray River from a point on the Murrumbidgee near where Maude now stands, through unknown country to the sea and back. That was a truly remarkable feat, for the down and return voyage totalled 1,700 miles. I believe that to most boys in Australian schools Sturt and his party of men who rowed down an unknown stream, encountered and overcame various dangers, mapped the river and made the return journey against the current, are a band of heroes.

The Murray River was named in the year 1830. I have already stated that this river and its tributaries form the greatest river system in Australia. The total length of the Murray and the Darling from their respective sources to the sea is 3,282 miles.

Senator Scott:

– Have you ever heard of the Blackwood River in Western Australia?

Senator MATTNER:

– I have, and it is a very great river indeed.

The Murray and the Darling form the fourth longest river system in the world. The Nile is 4,000 miles long, the Mississippi and Missouri system is 3,988 miles long, and the Amazon is 3,900 miles long.

Senator Scott:

– What did you say was the length of the Murray?

Senator MATTNER:

– The Murray and Darling combined are 3,282 miles long. The fall of the river varies from 9 inches a mile at Albury to about 1 inch a mile over the last 100 miles of its length. The Murray basin is approximately 414,000 square miles in area. Over only 5 per cent, of that area is the annual rainfall more than 30 inches. The average raintall over the whole basin is 17 inches. By way of comparison, let me point out that the Tennessee valley in America has an average rainfall of 50 inches.

The source of the river Murray is in the eastern highlands and the river is fed by fast streams, some of which are snowfed for months every year. The source of the Murray lies in some of the most rugged terrain in Australia. Below the Hume Reservoir the mountains open out into gently undulating plains. After the Murray and the Murrumbidgee merge, the river passes through mallee country for the rest of its length. The Murray, between the Hume Reservoir and the junction with the Murrumbidgee River, receives the waters of the Kiewa, Goulburn, Ovens, Campaspe and Loddon rivers, to mention only the main streams. We in South Australia have no such rivers as these; apart from the Murray, our rivers are very few and very small. lt is estimated that the upper Murray, including the Mitta Mitta and the Kiewa, has an annual flow of 3,500,000 acre feet. The annual flow of the Murrumbidgee is 2,600,000 acre feet, of the Goulburn, 2,400,000 acre feet, of the Darling, 2,150,000 acre feet, and of the Ovens, 1,169,000 acre feet. The total annual flow of all these streams averages just over 12,219,000 acre feet. This is sufficient only to cover the whole of the Murray basin, including the catchment area, to a depth of half an inch. Our greatest water system, therefore, is quite small in comparison with other great rivers of the world. The Amazon, in South America, with a catchment area of 2,230,000 square miles, has an annual run-off of 1,780,000 acre feet. The Congo, in Africa, with a catchment area of 1,540,000 square miles, has a runoff of 1,410,000,000 acre feet, which is more than 100 times that of the Murray. The Yangtze Kiang, in China, with a catchment area of 750,000 square miles has a run-off of 725,000,000 acre feet. The Mississippi, in the United States of America, with a catchment area of 1,243,000 square miles, has a run-off of 474,000,000 acre feet. The Danube, in Europe, with a catchment area of 320,000 square miles, has a run-off of 228,000,000 acre feet, which is nearly twenty times as great as that of the Murray. The Ganges, in India, with a catchment area of 588,000 square miles, has a run-off of 146,000,000 acre feet.

The rate of flow in the Murray is slow, because of the slight fall in the terrain. It takes about one month for water to travel from Albury to South Australia, and about two months for the head-waters of the Darling to reach Wentworth. This rate of flow is of great significance to our irrigation settlements lower downstream. In 1915 the Murray ceased to flow at Swan Hill for a whole month, the river being reduced to a chain of water-holes. I can remember the river being only a chain of water-holes in the lower reaches in South Australia.

Since the Hume Reservoir was constructed, a flow has been maintained at all times throughout the length of the Murray, even in periods of severe drought. Thanks to the construction work authorized by the Government and executed by the River Murray Commission, the river now flows all the year round. Despite the importance of the river to both Victoria and New South Wales, South Australia is even more dependent than are those States upon the river. In normal years, under the River Murray Agreement, South Australia is entitled to 1,250,000 acre feet of water. The State has no other river system from which to augment this supply. All South Australia’s irrigation areas depend for their water supply on New South Wales, Queensland and Victoria, and we make no secret of that fact. In time of drought, the supply to South Australia may be reduced to 700,000 acre feet. Evaporation and seepage may reduce the quantity further to about 500,000 acre feet.

This shortage of water is dangerous and must be remedied. The Snowy Mountains scheme is therefore of great importance to South Australia. The diversion of Snowy River water into Swampy Plains, and the proposed new dam above Renmark will augment South Australia’s supplies. The diversion into Swampy Plains will be of enormous importance to South Australia. It is little wonder that we in South Australia look with a great deal of apprehension every time tributaries of the Murray are diverted into the Snowy Mountains system. We do not mind these diversions, providing we are adequately recompensed for the water that is taken. I speak about the Snowy scheme with a great deal of interest, because I believe that we in South Australia will receive great benefit from the storage of water in the Snowy Mountains area. Earlier, I said that the development of South Australia depends on the availability of water from the Murray River. Decentralization, particularly in South Australia, depends on such water.

There are few places in South Australia where adequate water supplies are available for large-scale development, even for the establishment of large undertakings in the interior. Nearly every developmental project in the State depends on water from the Murray River. The Broken Hill Proprietary Company Limited is about to commence a steel and iron industry at Whyalla. That industry will be wholly dependent on water from the Murray River being piped a distance of hundreds of miles, as are the great shipbuilding industries already established there. It might well be said that a river runs into Whyalla as a result of the reticulation by pipeline. As honorable senators may know, when water is carried by pipes, practically none of it is lost through evaporation or seepage.

Even Adelaide depends on water from the Murray. The city would have faced a tragic situation last year had it not been for the availability of Murray water. I suppose that there are more dams and reservoirs being built in the Adelaide hills than in most other places in Australia. Last year, however, there was no catchment in that area. The Onkaparinga River, which supplies a great portion of Adelaide’s water supply, did not run. I speak with some knowledge of this matter of water catchment, and I can say that farmers in the Adelaide hills district did not impound any supplies of water last year. Supplies were obtained only by means of pumping water from the Murray River into the Milbrook Reservoir and using the Onkaparinga River as an adjunct. Water from the Murray is reticulated to the farthest end of the Yorke Peninsula, and also to the rocket range at Woomera. No matter where one goes in South Australia, with the possible exception of the south-east, one sees that the establishment of towns and decentralization projects relies for its success on the availability of water from the Murray. One of my colleagues reminds me that water from the Murray is even reticulated to part of the Eyre Peninsula.

In the construction of the proposed dam, we need to have the goodwill of Victoria and New South Wales.

Senator Wade:

– You have it.

Senator MATTNER:

– We are happy to have the goodwill of those States, and we appreciate it. That is as it should be. The States should be a happy family. If a dam is constructed at a point about 30 miles north of Renmark, and if the bank is 35 feet high, the water will be held back for 40 miles or so and 2,000,000 acre feet of water will be impounded over an area of 200 square miles. The dam will hold more water than any of the dams of the Snowy scheme.

Senator Scott:

– Does the honorable senator know the capacity of Lake Eucumbene?

Senator MATTNER:

– I understand that the proposed dam on the Murray will hold more water than any individual storage dam on the Snowy scheme. Already, drilling operations are being undertaken to determine a suitable site for the dam.

I return to the point that we are dependent, for the construction of the dam. on the goodwill of Victoria and New South Wales.

Senator Scott:

– And Western Australia. We might not agree to give you the money.

Senator MATTNER:

– I am glad that the honorable senator has mentioned that aspect. May I say that I anticipate Western Australia’s generosity. The question of financing the dam would be no trouble at all if all the States were happy to contribute in the same generous way as Western Australia apparently is prepared to contribute. If that were done, the £9,000,000 that the dam is expected to cost would be readily available. I am sure that the Prime Minister (Mr. Menzies) would be glad to hear that every State in Australia was urging him to provide the £9,000,000 that it will cost to build this dam which will increase the prosperity not only of South Australia, but of other States as well.

Senator Scott:

– There are a few strings attached to our support.

Senator MATTNER:

– I do not doubt that, but I suggest that they can easily be broken.

In the early days of Murray valley settlement, the settlers concentrated on the low-lying country adjacent to the river to avoid pumping difficulties. That is understandable. To-day, however, with pumps of new design and because of the reduced cost of power, the raising of water, even to levels as high as 100 feet or 150 feet is not difficult. Because of the efficiency of the modern pumps, we now have the use of higher level land for irrigation purposes. The irrigation of pastures, in conjunction with ordinary grazing practices, holds great potentialities for increased production of milk, beef and mutton. I do not think that, in the future, we shall concentrate wholly and solely on the production of vine fruits, pears, oranges and peaches in our irrigated areas.

Because of the very slight fall in the Murray, there are no suitable storage basins available on the lower levels. I can visualize that within perhaps 100 years the irrigation settlements along the Murray, such as those between Renmark and Berri, will be completely submerged as a result of the construction of dams. I believe that such dams will obviate a great deal of trouble in future years. In the past, the periodical flooding of the Murray has cost Australia, and the settlers along the banks of the river, millions of pounds. The river needs to rise only a few feet to overflow and swamp the irrigation settlements. The only criticism that I make out of the proposed dam is that it could perhaps be sited a little closer to Renmark. If it were, the floods that come down the river could be held in natural reservoirs and then reticulated. An orderly flow of water could be allowed to reach the sea, and water could be pumped to the higher levels. Loxton soldier settlement is on relatively high ground. The South Australian Government is pulling in a drainage system there at a cost of over £1,000,000 to drain some areas in that settlement. I have seen along the river

Murray private enterprise raising water .to a height of 90 feet to 100 feet and more, thus bringing into use the good, deep sandy soil on the high land, which is eminently suited to citrus growing. At Waikerie, or Golden Heights, as it is known, public-spirited men on the district council have purchased their own pumping plant which is delivering water to a height of, I think, about 90 feet, thus enabling spray irrigation to be used on the blocks. This scheme is one example of what can be done to provide settlers with suitable blocks of land along the river Murray. I will not live to see it, but I can visualize that in time many of the existing settlements in the swamps, as it were, or in the low-lying parts of the Murray will go out of existence, because those areas are natural reservoirs for the waters of the river.

Why is the Murray so important to South Australia? As I said earlier, even Adelaide itself is dependent for water upon the Murray. We have a scheme for taking water from the Murray and pumping it into Lake Bonney, near Barmera, but that scheme would give us only 250,000 acre feet, which could be just a drop in the ocean. We could easily construct reservoirs in South Australia away from the Murray, but there are no streams that would enable us to fill those reservoirs. Our only source of water is the river Murray, which we have to tap and then pipe the water far and wide. South Australians cannot afford to see any of the water of the Murray flow out to sea unused.

We pay a tribute to the River Murray Commission, which has safeguarded the rights of South Australia. All of us here, as Australians, appreciate what the commission has done. I know that in Victoria - a garden State and a land of milk and honey - there are many fine streams, and we in South Australia do not mind in the least utilizing some of the water which the people of Victoria are unable to use. The longer we live, the more do we appreciate the providence that designed the river Murray and its tributaries. The river has a very slow rate of flow and the country through which it passes is admirably suited to irrigation purposes. To pass from areas in South Australia where poor soil and lack of rainfall hinder production into the irrigation settlements is like going from a desert into a garden of Eden. These irrigation settlements make us realize the importance of the river Murray and its tributaries, not only to South Australia, but to Australia as a whole. I commend the report of the River Murray Commission. As a South Australian, I appreciate the good work that the commission is doing in conserving as much of the water of the Murray as it possibly can, so that thrifty men can use it to the best advantage.

Senator WADE:
Victoria

.- I welcome this opportunity to make a small contribution to the debate on the 1958/59 report of the River Murray Commission, which is another absorbing chapter of the story of national development made possible by water conservation. I suppose it could be argued that, on the eve of the .presentation of a national Budget, this subject does not excite the same interest as does the Budget. As individuals we take - and rightly so - a very lively interest in the contents of the Budget, and I suggest that this is an appropriate occasion for us, as Australians, to take a quick look at some of the fruits of our efforts, by way of taxation and administration, to develop this great land of ours.

No one can deny that this country needs people and water more than anything else. The two go together. Our national effort, in my opinion, is concentrated too much in the coastal and high rainfall areas, but I hasten to add that, as this is a young country with a small population, there has been no alternative to that programme. The report of the River Murray Commission discloses some of the tangible advantages that have come to our economy because of the work of the commission, and it is not difficult to visualize what can be done in this vast country if the same type of development can be expanded. I intend, as quickly as I can, to make some reference to the magnificent results of the work of this commission, and I shall also make some suggestions as to how the work of the commission could be expanded and developed in the interests of the Australian economy. If this debate does nothing more than to direct the attention of the public to the tremendous national advantages to be obtained by water conservation, it will serve a useful purpose. It is true that all governments, Commonwealth and State, have a very lively appreciation of the value of the River Murray Commission to the nation. It is worth mentioning for the information of those who are interested that all governments have made available to the commission the most able men at their command. The Commonwealth Government has no less a personage on the commission as one of its representatives than Senator Spooner, the Minister for National Development. He has shown a very lively interest in his responsibilities as a representative on the commission. The other Commonwealth representative is Dr. Loder, who holds the responsible position of Director-General of Works. Most of us know Dr. Loder. We know that he is a very distinguished Victorian, and in saying that I do not want to appear to be parochial. At one time he was chairman of the Victorian Country Roads Board and in that capacity he gained a grounding in the conduct of large public works undertakings that has since stood him in good stead.

The New South Wale.s representative on the commission is Mr. Corbett, who is chairman of the Water Conservation and Irrigation Commission. I venture to suggest that New South Wales could not have found a more able man to represent it on the commission. Victoria’s representative on the commission is Mr. East, who is chairman of the State Rivers and Water Supply Commission. Mr. East and his colleagues on the commission are recognized as world authorities on water conservation. South Australia has made available to the commission the services of Mr. Dridan, who is the engineer-in-chief of the South Australian Engineering and Water Supply Department.

So it will be seen that all governments realize that this work demands the best brains available in the country. I think that a glance at the record achieved by the present commission, while in no way minimizing the efforts of former members of the commission, illustrates the wisdom exercised by the Commonwealth and the States in the choice of their representatives on the commission.

The genesis of this story is contained in the first lines of the report of the commission for the year 1958-59, which read -

The functions of the commission are to arrange for the construction, maintenance and operation of the works set out in the River Murray Waters

Agreement, and for the operation of those works so as to distribute the available waters of the Murray and the storages in conformity with the provisions of Part VI. of the Agreement.

Senator Mattner has very ably referred to the natural facilities that the river Murray provides for the three States concerned. I think he said that the grade, or fall, of the river Murray from Albury to its mouth at the sea is approximately one inch in a mile. That is a most remarkable attribute for such a stream to possess because it means that almost unlimited facilities exist for handling the stream at most periods of the year. I think it is fair to say that few rivers of the world offer the same facilities for being harnessed for the needs of man. Senator Mattner also said that the average annual rainfall over the entire Murray basin is a mere seventeen inches. I remind the Senate that the Tennessee valley, which so often is cited as a gem of development, has an average annual rainfall of 50 inches. So, while the river Murray has great advantages in terrain and fall it also has some disadvantages which highlight some real problems which the commission has made great strides towards solving. The low average annual rainfall highlights two problems - the preservation of the catchment areas and the need for water for irrigation in time of drought. I hope to make some passing references to those matters later in my speech.

I do not think that the work of the commission has been fully appreciated by Australians until recent years. When the commission was set up in 1915 - just 45 years ago - the prophesy was made that if the commission successfully handled the tasks confronting it, a prosperous new era would be opened for the Murray valley. That was an understatement, as will be seen from a quick glance at what has happened in the Murray valley in the last half century. Let us look at what has happened in. Mildura. Mildura has an average annual rainfall of something like ten inches a year. Just imagine what a good annual rainfall would mean to those dry areas of Australia where the soil is basically fertile! Before irrigation came to Mildura the land in that area carried one sheep to 20 acres. Honorable senators who know that part of Australia will agree that I am not understating the position. To-day, with water, returns of up to £750 an acre are common.

Senator Ormonde:

– How many sheep are carried to the acre now?

Senator WADE:

– Sheep raising is not profitable to-day in Mildura, lt is much more profitable to grow citrus fruits and those commodities have brought Mildura to its present position of importance. Today there is a population of about 30,000 in the city proper and environs. Those honorable senators who have been to Mildura will agree that the place seems always to have an air of prosperity about it. The people seem to be happy and contented. They seem to have sufficient of this world’s needs to make their lives quite acceptable to them.

Senator Robertson:

– Magnificent orchards abound there.

Senator WADE:

– Yes, indeed, and I am sure that the present good standard of living obtained from what was not long ago bush land is attributable to the availability of water. Even to-day as you travel along some of the fringe areas you will see magnificent citrus orchards flourishing on one side of the fence and on the other side typical Mallee scrub. To-day Mildura is a flourishing city.

Senator Ormonde:

– Organized cooperation had something to do with it.

Senator WADE:

– Yes, and good management, but no matter how good the organization may be, without water the people would not stay there. Their livelihood depends upon water.

Another example of what water can do is to be seen at Red Cliffs, which is not far from Mildura. The country around Red Cliffs is similar to that around Mildura. I think the largest soldier settlement scheme in our history was undertaken there. The scheme was put into operation after the First World War when about 680 soldier settlers were established on the land in that area. They made a great success of the tasks to which they set their hands. They have not been subjected to droughts and frustrations that have beset soldier settlers in other parts of the Commonwealth.

The provision of water lends stability to the area that it serves. Let me mention some other towns along the Murray valley that are making a magnificent contribution to our economy. Swan Hill is a town of 6,000 or 7,000 inhabitants. They have an air of prosperity about them, even when people living in the lower rainfall areas of Victoria are suffering the hardships of drought. They always have sufficient water to meet their needs. They have engaged in dairying, fat lamb raising and the production of dried fruits and other commodities. All this has been made possible by irrigation. At places such as Kyabram, Echuca and Shepparton progress has been made with secondary industries as well as the rural industries. I shall refer to this aspect again at a later stage of my remarks. For the present, I should like to bring the Senate right up to date with what can be done with water. I shall quote some figures in relation to Robinvale on the Murray, which is regarded as the boom town of the 1950’s, to show how the town has progressed as a result of the availability of water. Fifteen years ago, Robinvale had an average school population of about 30 children. There are now 800 children attending the primary school and in addition there is a high school which has an enrolment of 200 pupils. In fifteen years the number of children attending school at Robinvale has risen from about 30 to 1,000, as a result of closer soldier settlement and the availability of water.

It is interesting to note that some people at Robinvale, in addition to producing dried fruits, have been courageous enough to venture into the olive industry. I think it is fair to say the olive industry in Robinvale is on a par with the industry that is being established in the Wimmera. I believe that if this industry is fostered and encouraged as it should be, ultimately it will save this country a great deal of overseas exchange. lt is also interesting to note that there is a venturesome soul in Robinvale who has planted 100 acres of cotton. I am not able to tell the Senate of the success that has attended this venture, but it is encouraging. I believe that this National Parliament should say to men who are courageous enough to venture into these industries, “ We will do what we can to encourage and support you and make it possible for you to expand these industries which are so vital to the economy of the country “.

Sir, the development to which I have referred has been possible only because of the great wisdom of those who comprised the River Murray Commission when it undertook its first major work which, as you know, was the building of the Hume Weir. It is not generally known that this dam is the largest water storage in the southern hemisphere. When it was completed in 1936 it had a capacity of 1,250,000 acre feet. Its capacity was increased in 1952 to 1,382,000 acre feet. In 1954, agreement was reached to increase its capacity to 2,500,000 acre feet. This great inland lake covers 33,000 acres and its surface is three times that of Sydney Harbour. I almost said the Sydney harbour bridge.

Senator McManus:

– What about the Bolte bridge.

Senator WADE:

– The thought of the Bolte bridge gives me an unpleasant twinge. Admittedly it is a beautiful bridge, but I shall never be reconciled to the means of its construction. When the extensions to the Hume dam are completed, this reservoir will hold sufficient water to meet all the needs of a city with a population of 1,000,000 people for 25 years.

Senator McCallum:

– Would not the water evaporate?

Senator WADE:

– That aspect has been taken into consideration. I am stating, not my guess but a statistical fact. I think this is a magnificent work in the interests of the national economy. When we realize that it is possible to construct many other water storage systems, it is evident that this country has a bright future. Great courage has been displayed even by the States-

Senator Ormonde:

– Why “ even “?

Senator WADE:

– After I said “even” I felt that I had used the wrong word. Even in this place we have the privilege of withdrawing an utterance, so at Senator Ormonde’s suggestion I withdraw the word “ even “ and say that the States, too, have shown great courage. In order to make possible the enlargement of the Hume dam, the township of Tallangatta had to be flooded. This town had 1,000 inhabitants. The Victorian Government, realizing its responsibility to the nation as a whole, was courageous enough to shift those people to another site, which involved an expenditure of about £2,250,000. But the value of the availability of water cannot be expressed in terms of pounds, shillings and pence.

Perhaps one of the greatest responsibilities that rests upon the commission to-day is the preservation of the catchment areas. The low rainfall area to which I referred earlier highlights this problem. The responsibility for the preservation of the catchment areas is vested in the New South Wales and - Victorian Governments and their reports, which are appended to the commission’s report, make most interesting reading. Great courage is being displayed in the preservation of the catchment areas. Gradually, the graziers are being obliged to reduce their herds and to vacate the areas that could be damaged by grazing. Fire is another hazard. Great efforts are being made to protect the catchment areas from the ravages of fire.

It is evident from the report that the commission has tackled every facet of the responsibilities. Perhaps one of the most interesting is the preservation of the red gum forests. It is not generally know that the commission has built fifteen structures - some on the north bank and some on the south bank - to allow water into the forest areas when required and to take it back when there is a surplus. All this has had the effect of making the Murray valley one of the most productive areas in the State. It is recorded that its primary industries produce annually £175,000,000 worth of fat lambs, fruit, wine, cereals, wool and beef. It is interesting to note that the development of primary industries, made possible by water conservation and irrigation, brings secondary industries in its train. I remind honorable senators that Wangaratta houses one of the most successfully operated mills in Victoria. The Bruck mills are a source of constant and increasing employment and of wealth to the city of Wangaratta. Echuca has a rice mill, and canneries operate throughout the length of that rich area.

While referring to the Albury- WangarattaBenalla area, I should like to mention that there is, quite justifiably I believe, a very strong force of public opinion in favour of the building of another weir, at Marraboor. I know that the New South Wales Government has very heavy commitments for the conservation of water in other parts of the State and that Victoria has heavy commitments, but I think the River Murray Commission could well be invited to have another look at the contribution it may be able to make towards the construction of a weir at Marraboor. When we look at the history of what has been done in the Murray valley because of the storages already in operation, surely we must be convinced that the construction of another weir, at Marraboor, would be of national benefit.

Let me say to Senator Mattner, who referred to the proposed dam in the Loxton area, that, whilst that dam would not be specifically in the State of Victoria, I am quite sure that those of us who represent Victoria and New South Wales are big enough to say that on this issue South Australia must have our moral support, because what benefits South Australia benefits the rest of Australia. South Australia is lamentably short of water. Senator Mattner rather facetiously made a passing reference to some of the streams with which Victoria is blessed. I venture to say that if South Australia had been blessed with the same wealth of running streams, it would not have found itself in the predicament in which it found itself last year when, because of the sparseness of natural water resources, even drinking water was scarce. Those of us who have more than average resources of water must be prepared to consider what contribution we can make to the development of South Australia.

Before I conclude I wish to refer to an organization that has played a magnificent part in the development of the Murray valley. It is a body of men who have banded together with a single desire to make a contribution to the national economy, and who have not sought any personal gain or recompense for their services. I refer to the Murray Valley Development League. My colleague, Senator Gorton, has a very close association with these people, and I am sure that he will endorse a great deal of what I have to say. I know that on various occasions he has given these people some encouragement. The Murray Valley Development League is a voluntary organization, its members being drawn from New South Wales, Victoria and South Australia. They represent local government organizations and big-hearted private individuals who are prepared to put their hands into their pockets to sponsor a cause. Having that objective, they are worthy of consideration.

Their sphere of influence covers approximately 60;000 square miles. For the benefit of. those who may not have heard about the organization, I should like to refer to its aims. The league was formed in 1944 by people from the three States through which the river Murray flows. As I have indicated, it was a banding together of local government organizations and private people to seek and to aid a more rapid development of the great Murray valley region. The league has merely three objectives, but what a wealth of purpose they contain! They are to secure the rapid overall development of the Murray valley through the conservation and utilization of its natural resources; to work for decentralization by promoting and assisting the organization of country towns and cities; and to devise and carry out. practical settlement schemes and promote policies which will advance primary industry within the region. To read about some of the league’s accomplishments is to get an indication that it knows where it is going, that it has a contribution to make to the development of the country, and that it has been very successful in the making of its contribution.

After the 1956 flood the Murray Valley Development League made a most intensive study of the flood problem and prepared a paper which set forth some fourteen points that could and should be considered by the contributing governments. I saw the 1956 flood and I suppose most honorable senators have seen rivers in flood to a greater or lesser degree, but unless one sees a river in flood one does not realize the havoc that is caused. I am not suggesting for one moment that at this stage any real relief can be afforded in the form of flood mitigation; but I am pointing out that this organization has made an intensive study of the causes of the problem and of the action that could and should be taken, to its way of thinking, to give some relief.

Members of the league have interested themselves in a land settlement scheme. At Buronga, which is on the New South Wales side of the river, they have, in a very short space of time, built a monument to their endeavours. Out of virgin bush they have brought 89 farms into production. That is the kind of contribution that this vast country of ours needs more than anything else. Governments can make finance available and can give a lead, but I believe that the people of Australia have the future of this great country in their own hands. Our future lies in our being prepared to get together and contribute to its development. A total of £125,000 has been contributed to the Murray Valley Development League by private individuals and semigovernmental bodies during its fourteen years of existence. The only government contribution that has been made has been one of £500 by the Victorian Government for the production of a handbook, which has been of great value to people who are interested in starting similar projects. On previous occasions pleas have been made to the Federal Government to consider the granting of a subsidy to this organization. T know there are constitutional difficulties which probably prevent such grants being made. Because of the tremendous effort this league is making to a very large and fertile area of Australia, I suggest that the Government give consideration to setting a precedent by doing something for this organization. Let us make a start with this organization so that those who follow will know that if they are prepared to combine to develop a given area for the expansion of our economy they, too, will receive similar treatment. Even at this late stage, on the eve of the presentation of the Budget, I earnestly suggest that something be done. I hope that if not at present, then in the near future, the Government will realize that in this league we have an organization that is worthy of some consideration, for the contribution it is making cannot be measured merely by money.

The story I have so haltingly tried to tell is about what has resulted from a vision splendid, from the vision of men who have seen the rich dry earth, which is in need only of water, converted to a highly productive area. I feel that if we can expand such thinking, if we can continue such a policy, this country has a great future. If we are not prepared to think along the lines I have suggested, then I am concerned for the future of this great country.

Senator LAUGHT:
South Australia

– in reply - First, let me congratulate those honorable senators who have spoken for the very interesting contributions they have made. I recall that when I had concluded my speech on the evening of 5th May last

Senator Ridley made an interesting reference to the legislation relating to the Tooma diversion which was dealt with by the Senate a couple of years ago. Certain aspects of that legislation are referred to in the document now before us. As a South Australian, Senator Ridley is very conscious of the efforts being made by the government of that State in connexion with the river Murray waters, and in particular in connexion with the dam envisaged by the Premier of South Australia, Sir Thomas Playford. After Senator Ridley had spoken, Senator Hannaford made a geographical study of the river and delivered an enlightening speech relating to its capacity. Unfortunately, Senator Drury is not here to-day and, therefore, is unable to conclude the speech he commenced when this matter was last before the Senate. 1 understand that he is now on a mission overseas. What he did contribute to the debate was very interesting and informative.

This afternoon, Senator Mattner gave us the benefit of his experience with water conservation. On his own property in the Adelaide Hills, he has gone to great lengths to conserve water. He realizes the importance to South Australia of water conservation.

I join with Senator Wade in paying tribute to the work of the Murray Valley Development League. I enjoy the monthly publication which that league so generously sends to me. Emanating as it does from rural residents in the river Murray area, it is a publication of great moment.

In conclusion, I remind the Senate of several developments that have taken place since this matter was last before us. I refer to the huge dam that Sir Thomas Playford proposes to have constructed across the river Murray. Honorable senators will realize that the report with which we are dealing makes no reference to this dam because the period it covers concluded before the proposal for the dam had been brought forward by Sir Thomas Playford. It might interest honorable senators to know that on 24th June last Sir Thomas Playford met the Prime Minister (Mr. Menzies) in Canberra to discuss this project. If we are to judge from reports, those discussions were most cordial. I understand that three of my Senate colleagues were in the proposed dam area recently. They will know that at the moment a geological survey is being made of the site. The Mines Department of South Australia has provided two drilling rigs which are now drilling at the spot where it is proposed that this massive wall, some miles long, 45 feet high and of tremendous thickness, shall be erected. We all appreciate the tremendous importance of a thorough geological survey of a proposed dam site. That survey has been in progress for three months now and it is expected that it will be completed by the end of another three months. Already there have been television programmes depicting the work being done at the site, and 1 can assure honorable senators that the South Australian Government is determined that the River Murray Commission shall have before it a complete geological picture of the proposal. I hope that the next report of the commission will contain some reference to the work being done in connexion with the proposed dam.

It was generous of Senator Wade to say that honorable senators from other States are very interested in the welfare of South Australia, especially in the development of its water resources. I hope that for some years to come the question of water conservation by means of the dam proposed by Sir Thomas Playford will be a subject of lively interest to honorable senators. The important moment will be when the Senate is considering finance for the dam. Sir Thomas Playford’s preliminary estimate of the cost is £9,000,000, and I understand that it is to be suggested that the Commonwealth accept responsibility for one half of that cost, South Australia being responsible for the other half. In mentioning that, I emphasize that the Commonwealth should be conscious of the fact that water stored behind this dam will be reticulated to many important areas within the Commonwealth.

Senator Wright:

– Where is the dam site with relation to the border?

Senator LAUGHT:

– The dam is to be constructed about 40 miles on the South Australian side of the border but the water will spread back over the border for perhaps 30 or 40 miles. The question of compensation to land holders in Victoria, South Australia and possibly New South

Wales will have to be considered, but the important point is that the conservation of this water will bc of tremendous value in servicing a possible population of 1,000,000 people in the metropolitan area of Adelaide by 1970. Further, the Broken Hill Proprietary Company Limited envisages spending approximately £40,000,000 on the expansion of the steel works at Whyalla. Every drop of water used by that steel works will be drawn by pipeline from the Murray River. We are encouraged to read that, despite certain changes in the United Kingdom’s plans, work at Woomera will be going on apace. Every drop of water used at Woomera will come from the Murray. Therefore, the report of the River Murray Commission, and the dam to which I have referred, are of vital interest to the Senate in its consideration of shipbuilding, steel works and foundries at Whyalla, the Woomera project, and other matters of vast national importance. River Murray water will be servicing these important national projects which are being carried on in South Australia. There will be a large oil refinery in the Adelaide metropolitan area. Tenders for it were announced in this morning’s edition of the Adelaide “ Advertiser “. For this project water from the Murray will supplement the metropolitan supply.

I thank honorable senators for their interest in this subject. In particular, I thank the Minister for National Development (Senator Spooner), who sat in during the course of the debate in May last. From discussions I have had with him since, I know that he has a personal interest in the whole matter of water conservation on the Murray and, in particular, in the important inquiries that are now going on.

Senator Gorton:

– Have you made any inquiries to ascertain whether the dam would lead to a salting up of adjacent land?

Senator LAUGHT:

– Up to date the inquiries made by Sir Thomas Playford show that the land will not be subject to very much deterioration. I cannot give a precise answer to the Minister for the Navy, but I believe that the projected site for the dam is such that a minimum disturbance of the use of land will take place.

Senator O’FLAHERTY:
SOUTH AUSTRALIA · ALP

– The area is now being surveyed to ascertain the position in that regard.

Senator LAUGHT:

– Possibly the geologists who are paying so much attention to the strength of the soil where the wall is proposed will also pay attention to that matter. I suggest that normally when water is brought to a locality, especially inland, it does far more good than damage. A large area of water could do much good to the interior of South Australia, the far north of Victoria, and the far west of New South Wales. From my knowledge, I do not think that the very small project at Lake Victoria has done any harm.

Senator Gorton:

– That is a natural lake, though.

Senator LAUGHT:

– lt has been built up. The man-made additions to Lake Victoria have not done undue barm to that area. On balance, the dam I have referred to will not, I think, lead to deterioration of the area. If it does, the deterioration will not be of any great significance.

Question resolved in the affirmative.

Sitting suspended from 5.20 to 8 p.m.

page 23

QUESTION

SUSPENSION OF STANDING ORDERS

Motion (by Senator Spooner) put -

That so much of the Standing Orders be suspended as would prevent the Minister for Civil Aviation (Senator Paltridge) speaking without limitation of time when moving that the Estimates and Budget Papers 1960-61 be printed.

The PRESIDENT:

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

page 23

ESTIMATES AND BUDGET PAPERS, 1960-61

Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP

– I lay 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, 1961.

The Budget 1960-61- Papers presented by the Right Honorable Harold Holt in connexion with the Budget of 1960-61; and

National Income and Expenditure 1959-60 - and move -

That the papers be printed.

To-night, the Treasurer (Mr. Harold Holt) is delivering in another place his

Budget speech for 1960-61. 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.

In its Budget for this year the Government aims to achieve a surplus of total receipts over total expenditures. To make this possible it is keeping expenditure commitments to a minimum and it proposes also to increase taxation and charges sufficiently to yield an additional £40,900,000 in a full year and £36,900,000 in 1960-61. Thus, in the matter of the Budget, the Government is following through the broad programme of economic policy measures announced by the Prime Minister (Mr. Menzies) last February. One of the main courses of action then proposed was to strengthen resistance to the rise in prices and costs and, in particular, to prevent large increases in the factors which affect costs generally. That was why the Government intervened in the basic wage proceedings and advised the Conciliation and Arbitration Commission of some of the consequences of granting further large wage increases before the economy had had time to absorb those made not long before.

Next, the Government decided to remove import licensing controls so that, apart from certain licensing arrangements to meet special problems, the flow of imports into Australia would be unrestricted except for the customs tariff. This would add, through greater imports, to the supply of goods. It would also give Australian industry and trade the widest access to overseas supplies of materials, equipment and finished goods and so help to improve efficiency and keep down costs. Thirdly, the Government expressed its approval of the action being taken by the Reserve Bank of Australia to prevent any increase in the liquidity of the banking system over the year and said that it would continue to support a policy of restraining excessive liquidity.

Finally, it undertook to do all in its power to avoid deficit finance in 1960-61. This would prevent any further boost to demand of the kind which occurs when Government expenditure runs ahead of revenues and public borrowings. We did not expect these measures to produce immediately all the results at which we were aiming. As the Prime Minister said, the aim was rather to bring strong and increasing pressure against those forces which were tending to throw the economy out of balance; and we saw this pressure taking effect gradually over a period.

The Government has now taken stock of the position again in the light of recent trends and of the prospects ahead, so far as these can be seen. Clearly, a strong up-thrust of activity is still very much under way. Much of this activity - probably most of it - is desirable in every sense of the word. In point of employment, output and growth of capacity for production, 1959-60 was, without doubt, a notable year.

But there is another side of the picture, not so favourable. Prices and costs rose sharply over last year and, so far, the rate of increase does not seem to be slackening. Shortages of key materials and of some classes of labour have appeared - clear signs that, once again, our efforts to expand are, in some directions, over-reaching our resources. The recent rate of imports also suggests that, notably though local supplies have increased, they are failing to match the rise in demand and this, in consequence, is spilling over into demand for imports. Speculation in shares and other securities and in land is disturbingly active and prevalent. These features of the position are all matters for concern and each betokens, in its own way, a lack of balance between overall demand and supply.

For the future, it is true, as always, that expansion must be kept moving and resources fully employed. Our population continues to grow rapidly and, again this year, there will be a considerable body of new workers to find occupations - some of them migrants, the majority young people leaving school. To meet the needs of such expansion, it would be quite normal for some rise in levels of expenditure to occur; but there would be clear dangers if the rise continued at the pace of recent months.

One such danger would be a speeding up rather than a slowing-down of price and cost increases. No doubt, with imports running freely and some scope for still greater local output, we can reckon upon a further increase in total supplies. But demand, on its recent showing, could outdistance any such increase and then we would have a scramble for scarce materials and’ all the other conditions in which price inflation thrives.

A second danger would be a rise in imports to levels higher than we can afford. We have been prepared all along to see, and indeed to welcome, a rise in imports to meet real deficiencies in local requirements, long denied full access to overseas supplies; and we have, been prepared to use a fair, amount of our quite large overseas reserves to finance such imports. But it would be an altogether different thing to dissipate these reserves on imports to feed a domestic boom.

As the Government sees it, then, the situation clearly requires a steadying-down in the rates of increase in expenditure. This is necessary to ensure a stiffening of resistance to price and cost increases; it is necessary to avoid critical shortages of key materials and labour; it is necessary to prevent an excessive rise of imports. In this, there is no thought of holding back well-based expansion; on the contrary, output should have a better chance to grow, productivity to improve and exports to increase’ if we can lessen some of the more extreme pressures on our system.

Imports will be considerably greater this year than last and that should help to correct the situation because of the contribution it will make towards meeting demand. It will, almost certainly, involve a substantial running down of our international reserves; for even if exports and capita] inflow are as high this year as last, we will have a larger import bill to meet. The Government, however, wants to make it quite clear how it views this prospect. We moved out of import controls last February, firmly intending to keep out of them and believing, that, given reasonable success in trading abroad and in attracting overseas investments, we should be able to do so. Nothing whatever has happened since then to alter that belief and the move has so far been every bit as successful as we hoped. There seems to have been a minimum of dislocation to local industry. Our own reserves of gold and foreign exchange at the end of 1959-60 were quite as high as we had expected and, having recently obtained a still larger quota in the International Monetary Fund, with a corresponding addition to our drawing rights, our total reserves position is now really strong. We are certainly well placed to stand a considerable fall in reserves and the Government is prepared for this. The Government states this in case there are doubts in any minds as to what our attitude or intentions might be.

Of course, world trends are generally unpredictable and we have no control over them. We do, however, have some control over the demands we ourselves make upon external resources and it is there particularly that the situation needs a steadying hand. Since import controls were lifted, the rate of imports has increased to some extent. This increase has not been inordinate and certainly no more than we expected. But the rate has been carried upward by the rise in local expenditure and that is the vital point. We could not afford imports to go on rising indefinitely as they have done; neither, however, could we afford local expenditure to keep on rising as it has done. Plainly, if we are to keep imports within limits we can afford, the growth of demand must be restrained.

Within the province of the Commonwealth, such restraint has to be sought chiefly through monetary and budgetary action. For the past year or more, monetary conditions in Australia have been all too easy and this has contributed to the rise in expenditure.

In 1959-60 the central bank sought, by firm use of its power over bank reserves, to prevent any increase in banking liquidity over the year and, if possible, to bring about some reduction, lt succeeded in doing this, to the extent that the ratio of liquid assets and government securities held by the major trading banks fell from 22.3 per cent, in June, 1959 to 18.9 per cent, in June, 1960. However, trading bank advances have risen steeply in recent months and, for the year as a whole, showed a total increase of £99,000,000. This is quite contrary to the needs of our current situation and the Reserve Bank some time ago quite properly requested the trading banks to make an immediate and significant reduction in their rates of new lending.

In the coming months, the fall in our overseas reserves will tend to- reduce liquidity both of the public and of the banking system and the sharper the fall in reserves the greater the decline in liquidity will be.

We have necessarily taken account of this prospect in shaping our policy for the year. It is one of the consequences which increased imports will have for our situation, others being, of course, the increase in available supplies and the advantage of obtaining, quite possibly, some goods and materials at more competitive prices.

Between monetary conditions and the Budget there is, of course, a close and important connexion. For if a cash deficit has to be financed with bank credit, the effect is to add to the supply of money. There could be no thought, under present conditions, of doing anything less than balance the Budget and there is a case for doing more than that. It is essentially a

Case for the Government taking its due part in the process of moderating demand. We have approached the matter, first, by keeping expenditure commitments down so that, although there will inevitably be an increase in expenditure over last year, it will be a much smaller increase than occurred in 1959-60. Besides this, we have decided to increase taxation along lines I shall explain later.

page 26

EXPENDITURE, 1960-61

Defence

In 1959-60, defence expenditure was £193,585,000. For expenditure this year we have fixed a ceiling of £198,153,000, so allowing for an increase of £4,568,000.

War and Repatriation

At existing rates of pensions and other benefits, it is estimated that expenditure on War and Repatriation services in 1960-61 would be £96,243,000, an increase of £9,392,000 on expenditure in 1959-60. However, despite the general need to limit expenditures this year, the Government has decided to make certain increases in repatriation benefits, including rates of pensions and provisions of medical treatment.

The special rate war pension for totally and permanently incapacitated exservicement will be increased by 10s. a week, bringing the total payable to a single man to £12 15s. a week. In addition, war widows pension will be increased by 5s. a week, making the rate £5 10s. a week, and the domestic allowance payable to widows with children under age sixteen and certain other classes will also be increased by 5s. a week to £3 a week.

The service pension payable to certain classes of ex-servicemen and women will be increased by 5s a week to a maximum weekly rate of £5. Service pensioners will also receive the benefit of the new means test in the manner I shall presently describe as applicable to social service pensions.

The Government has also agreed to provide free medical treatment for disabilities not due to war service to service pensioners, including Boer War Veterans, and this benefit will operate as soon as administrative arrangements can be made. The cost of these increased benefits is estimated to be £2,374,000 in a full year and £1,734,000 in 1960-61.

National Welfare Fund

If present scales of benefits were to remain as they are, it is estimated that total expenditure from the National Welfare Fund in this year would be £322,355,000, which would be approximately £23,000,000 greater than expenditure in 1959-60. Again, however, the Government has decided that, despite the overall objective of keeping commitments down, it should make some additional provision for those members of the community who, through age or other circumstances, are least able to assist themselves.

A further increase in age, invalid and widows pension rates will be made this year. They will be raised by 5s. per week, making the new maximum pension rates, exclusive of any further pension payable for children, as follows: -

In addition, of course, single pensioners who have no income other than their pension and who pay rent, are able to obtain supplementary assistance of 10s. per week. The cost of these increases is estimated at £9,100,000 for a full year and £7,000,000 for 1960-61.

Since it assumed office, the Government has done a great deal to extend the eligibility for pension benefits of various classes of people by its successive relaxations of the means test. A further important step is now proposed. A structural change will be made in the means test which will remove what has been widely regarded as an anomaly in the operation of the means test on property as compared with the means test on income. This matter has had the attention of the Government over a considerable period and it has now been able to evolve a scheme whereby income and property may be merged for the purposes of assessing pension entitlement on a common basis.

Whereas in the past two independent means tests operated - one on income and one on property - the new means test will take into account one composite figure representing the pensioner’s “ means as assessed “. In the case of age and invalid pensioners and widows with no dependent child or children, “ means as assessed “ will comprise the pensioner’s income, which by definition does not include income from property, together with a property component. This property component will be £1 for each complete £10 of the pensioner’s property in excess of the £200 disregarded. The rate of pension payable will be the maximum rate less the amount by which “means as assessed” exceeds £182 per annum. The property bar of £2,250 beyond which no pension is now payable will be removed.

The new means test will ensure that no person who qualifies for an age, invalid or widows pension will receive less than the maximum rate until income and/or the property component exceeds the present amount of permissible income - £182 per year. The pension will then, in the normal way, be reduced by the amount of the excess. A widow with a child or children may. now have property up to £2,250 without the rate of her pension being affected. If the value of her property exceeds this figure, no pension is payable. Under the new means test, where a widow’s property does not exceed £2,250 it will continue to be disregarded. Where it exceeds £2,250, £1,000 will be disregarded and the new means test applied, as in the case of age and invalid pensioners.

The new proposal offers an inducement to save, to acquire and to retain property in exactly the same way as people are encouraged to employ their resources and energies to provide income. The treatment of income and property under the means test will thus be brought into closer harmony. A more detailed explanation will be given by the Minister for Social Services (Mr. Roberton) in a statement he proposes to issue shortly. The new means test will add £4,200,000 to the cost of pensions for a full year and £1,500,000 in 1960-61.

At present, women whose husbands are in prison are, in certain circumstances, eligible for a maximum pension of £4 2s. 6d. a week. They will, as far as rates and means tests go, be treated in future on the same basis as widows and, if there are any children, may receive a basic rate up to £5 5s. a week, with a further 10s. for each child after the first.

The increased rate of pensions will be applied on the first pension pay-day following the passing of the necessary legislation. It will take some time for the Department of Social Services to make the arrangements required for the operation of the new means test. It will commence from a date to be proclaimed which is expected to be in early March, 1961.

The total cost of these additional benefits is estimated to be £13,300.000 in a full year and £8,500,000 in 1960-61. On the other hand, the repatriation proposals in relation to medical treatment will involve a saving in expenditure from the National Welfare Fund of £157,000 in 1960-61. After allowing for these factors, total expenditure from the National Welfare Fund in 1960-61 is estimated at £330,698,000, or £31,335,000 more than last year.

Departmental

The estimate of departmental expenditure in 1960-61 is £79,305,000, an increase of £3,760,000 over expenditure in 1959-60. The increase due to the full year cost of wage and salary margins increases is £2,000,000. On the other hand, there will be one less pay day this year than last, which involves a saving of £1,800,000.

Business Undertakings

Margins increases will also have a considerable effect on expenditures by the various business undertakings, although here again there will be one less pay day. Post Office expenditure on ordinary services is estimated to be £112,296,000, an increase of £2,099,000 on 1959-60. Expenditure of the Commonwealth Railways is expected to be £554,000 greater than last year and expenditure on broadcasting and television £1.363,000 greater.

Territories

The total amount to be provided for the Territories in 1960-61 is £26,439,000, which is £2,881,000 greater than expenditure last year. Within this total, £6,822,000 is for expenditure in the Northern Territory and £14,500,000 represents a grant towards expenditure of the Papua and New Guinea administration. The grant last year was £12,808,000.

Payments to the States.

Payments to the States in 1960-61 are estimated to total £350,607,000, which is £29,192,000 greater than the comparable payments in 1959-60.

Financial assistance grants payable under the new financial arrangements, which came into operation in 1959-60, are tentatively estimated to be £267,622,000, an increase of £23,122,000 on last year. In 1959-60, the first year of the new arrangements, the finances of the States showed an improvement, despite the heavy increase in costs through margins increases.

The net increase in Commonwealth aid roads grants this year over last year will be £2,077,000. Actually, the Commonwealth aid roads legislation provides for an increase of £4,000,000, but last year there were non-recurring payments amounting to £1,923,000.

The amount recommended by the Commonwealth Grants Commission for special grants to Western Australia and Tasmania this year is £8,618,000, which is £292,000 more than the total special grants last year.

The Government has had the benefit of the preliminary views of the Australian Universities Commission on future university needs. When the report of the commission is available later in the year the Government will examine the position further. In the meantime we have included £11,000,000 in the Budget to permit the continued development of State universities in the current financial year in co-operation with the States. This compares with the actual expenditure by the Commonwealth of £7,’628,000 in 1959-60.

An amount of £1,000,000 is being provided this year for development in the northern part of Western Australia, compared with expenditure last year of £484,000.

Capital Works and Services

Expenditure on capital works and services in 1960-61 is estimated to be £139,921,000, compared with £142,060,000 in 1959-60. There is thus an estimated reduction of £2,139,000.

Amongst the various items, some of which show increases and some decreases on expenditure in 1959-60, the largest reduction is in the estimate for the Snowy Mountains Hydro-electric Authority. Actual expenditure by the authority ‘last financial year was £28,250,000. This included £2,650,000 provided in additional estimates to meet expenditures due to exceptionally rapid progress on some of the major contracts. The amount to be provided this year is £18,500,000.

Provision of £37,300,000 is being made for expenditure on Post Office technical equipment. This represents an increase of £1,642,000 on expenditure in 1959-60.

Expenditure on civil works to be carried out by the Department of Works in 1960-61 is estimated at £16,887,000, an increase of £3,298,000 on last year, when expenditure fell considerably below the Budget estimate.

An amount of £4,750,000 is being provided for the Albury-Melbourne rail standardization project. Expenditure last year was £3,672,000.

International Payments

In 1959-60, payments totalling £11,812,000 were made to the International Monetary Fund and the International Bank for Reconstruction and Development on account of our increased subscriptions to these institutions. There will be no comparable payment this year. We are, however, providing an amount of £2,072,000 to meet our initial subscription to the International Development Association.

Expenditure on international relief and development which includes contributions under the Colombo Plan and to various United Nations organizations, is estimated to be £5,553-000 in 1960-61, compared with £5,221,000 in 1959-60.

Other Commitments

In June, the Australian Loan Council approved for 1960-61 a governmental borrowing programme for State works and housing of £230,000,000, which is £10,000,000 greater than the 1959-60 programme. It was considered that, when allowance is made for increased costs and other factors, the amount approved for the year will permit a volume of works and housing construction about the same as that of last year. Subject to various conditions, the Commonwealth has undertaken to support the programme, if necessary, from its own resources.

Again this year, we face large debt maturities and have to provide against the possibility of heavy redemptions. Last year, redemptions in Australia and abroad totalled £77,400,000, which was £7,400,000 greater than the Budget estimate. In the circumstances of this year, redemptions could be somewhat greater and we have therefore included in our reckoning an amount of £80,000,000 on this account.

The amount to be provided by the Commonwealth for war service land settlement this year is estimated at £2,750,000, which is £4,187,000 less than expenditure in 1959-60.

Estimated Total Expenditure

In total, expenditure ordinarily charged to the Consolidated Revenue Fund is estimated to be £1,483,753,000, which is £81,331,000 greater than comparable expenditure in 1959-60. The other items I have mentioned - Loan Council borrowing programmes, debt redemptions and war service land settlement - add up to £312,750,000, which is £8,380,000 greater than last year. All told, therefore, the estimated expenditure for which we have to provide amounts to £1,796,503,000. This is £89,711,000 above actual expenditure in 1959-60.

Total expenditure in 1959-60 was approximately £122,000,000 greater than the year before so that the estimated increase of £89,700,000 this year is some £32,000,000 less than the increase which occurred last year.

Of the estimated increase of £89,700,000 in 1960-61, the addition to Loan Council works and housing programmes accounts for £10,000,000 and the proposed increases in social service and repatriation benefits for a further £10,100,000. Within the balance of £69,600,000, there are such items as increased payments to the States, £29,200,000; increased cost of social service benefits at existing rates, £23,000,000; increased cost of repatriation benefits at existing rates, £8,100,000; increased debt charges, £3,500,000; and increased provision for redemptions, £2,600,000. These items, all of which arise from pre-existing commitments, add up to £66,400,000. If these facts are borne in mind, I think it becomes evident that the Government has lived up to its undertaking to keep expenditure to a minimum.

page 29

REVENUE, BORROWINGS AND OTHER RECEIPTS, 1960-61

On the basis of existing taxation rates, total revenue in 1960-61 is estimated to be £1,572,600,000, which is £140,800,000 greater than actual revenue in 1959-60. Of this total increase, £121,400,000 represents taxation revenue, £16,100,000 revenue of business .undertakings and £3,300,000 other revenue. The estimates of taxation revenue reflect, in part, the 1959-60 incomes of companies and other taxpayers and, in part, anticipations as to the trend in employment, earnings, sales and trade in 1960-61.

Customs revenue this year is expected to be £13,600,000 greater than last year. This, of course, is based on the assumption that total imports will be considerably higher. Excise revenue is estimated to show an increase of £12,600,000 over last year. Some increase is expected from the main items subject to excise, such as petrol, beer and cigarettes.

The estimate of sales tax revenue is £14,800,000 above the amount obtained from this tax in 1959-60, the assumption being that sales of goods subject to this tax will again rise considerably, even if not by as much as last year.

Collections of income tax on individuals are estimated to be £47,800,000 greater than in 1959-60. Part of this, of course, would come from assessments this year on incomes of last year and part of it from pay-as-you-earn collections in 1960-61. Income tax on companies at present rates would yield £21,900,000 more than in 1959- 60. There will be a certain amount of revenue - estimated at £4,500,000 - from the withholding tax in this financial year. On the assumption that employment and earnings will increase significantly in 1960- 61, revenue from pay-roll tax is estimated to be £4,800,000 higher this year than last.

An increase of £14,000,000 is expected this year in Post Office revenue, partly through increased business and partly through the full year effect of the increased charges applied last year. Revenue from railways, broadcasting and television is estimated to rise by £2,100,000.

Loan Raisings

In 1959-60 we borrowed £189,800,000, which was approximately the amount estimated in the Budget. But it appears certain that we will not be able to raise as much as that during 1960-61. Last year, we secured four cash loans abroad, totalling £42,000,000. This year, however, we will not be able to obtain any new money loans in London because of the maturities we have there. As to other centres, we will certainly borrow there if we can, so long as the terms and conditions are acceptable; but it is obvious enough that we cannot count upon getting anything like the same amount abroad this year as last.

Within Australia, the outstanding feature of our loan raisings last year was the amount of subscriptions from savings banks. These totalled £41,000,000. The basic reason for this was the exceptionally large increase in savings bank deposits during the year. Although we can expect further substantial support from the savings banks this year, it would be optimistic to expect this to be as high as the contribution made in 1959-60.

Taking all considerations into account, the Government does not feel that it could rely upon obtaining more than £150,000,000 from loan raisings in 1960-61. That is to say, we have to reckon upon a shortfall in loan raisings of about £40,000,000 by comparison with 1959-60.

Other Receipts

We estimate that receipts of the National Debt Sinking Fund which will be available for redemption of maturing debt will be of the order of £52,500,000. It does not appear that there will be any net amount available from other sources. There will be a certain amount of income accruing to various trust accounts. On the other hand, a payment of £7,200,000 will have to be met this year from the Wheat Prices Stabilization Fund.

Total Receipts

Adding together the estimates of £1,572,600,000 for revenue at existing tax rates, loan raisings of £150,000,000 and Sinking Fund receipts available for redemptions of £52,500,000, the total estimate of receipts at this stage becomes £1,775,100,000.

page 30

TAXATION

If total expenditure for the year were to be £1,796,500,000 and total receipts were £1,775,100,000, we would have a cash deficit of £21,400,000. As I have said earlier, we think it would be entirely wrong under present circumstances to budget for a deficit. We go further than this, however, and say that the Commonwealth Budget should do something towards reducing the current pressure of demand in the economy. This implies that we should budget for a cash surplus, even if not a large one, and if that is to be done, there is clearly no alternative to raising appreciably more revenue by way of taxation. We have therefore decided upon the following proposals: -

Income Tax

page 30

COMPANIES

It is proposed to increase by 6d. in the £1 the rates of tax payable on incomes derived by companies during the income year 1959-60. The rate of 10s. in the £1 payable on insufficient distribution of incomes of private companies will remain. The gain in revenue from the increased rates is estimated to be £18,000,000 in a full year and £16,600,000 in 1960-61.

page 30

INDIVIDUALS

In the Budget last year, a rebate of ls. in the £1 was allowed against the tax payable by individuals on 1959-60 incomes. Under the altered circumstances of this year, the Government finds itself unable to continue this rebate in respect of 1960-61 incomes. Appropriate adjustments will accordingly be made to the instalments deducted from salaries and wages and to provisional tax for 1960-61. Discontinuance of the rebate is estimated to result in additional revenue of £22,750,000 for a full year and £20,250,000 for this financial year.

page 31

AGED PERSONS

In consonance with the increase in age pensions, it is proposed to raise the level of the income tax age allowance to residents of Australia who meet the age qualification, which is 65 years for men and 60 years for women. At present no tax is payable by an aged person whose net income does not exceed £429. In future, the exemption will apply to net incomes not exceeding £442. In the case of a married couple, both qualified by age, the present exemption level for the combined net incomes of the couple will be increased from £858 to £884. The cost to revenue of these adjustments will be £375,000 in a full year and £215,000 in 1960-61.

page 31

GIFTS

Income tax deductions are to be allowed for gifts of £1 and upwards to -

The National Trust of Tasmania

The National Gallery Society of New South Wales

The Australian Productivity Council

The latter body has been established to promote greater productivity in industry. These activities should complement in a useful way the work started some years ago by the Standing Committee on Productivity which is being carried forward by the Department of Labour and National Service.

It is also proposed to allow deductions for gifts made exclusively for the purposes of medical research or education to the following: -

College of Radiologists of Australasia

Australian Council of the College of General Practitioners.

Australian Postgraduate Federation in Medicine.

College of Pathologists of Australia

It is estimated that the cost to revenue of these allowances will be £15,000 in a full year. There will be no cost in 1960-61.

page 31

SUBSCRIPTIONS

It is proposed to increase the allowance for periodical subscriptions paid for membership of a trade business or professional association. At present, the deduction for an annual subscription to any one organization is limited to £1010s. This limit is to be increased to £21. The cost to revenue of this proposal will be £25,000 in a full year, but there will be no cost in 1960-61.

page 31

DEPRECIATION

An increase is proposed in the amount upon which the special 20 per cent. depreciation may be claimed in respect of residential accommodation provided for employees, share-farmers and tenants engaged in agricultural, pastoral or pearling activities. The 20 per cent. allowance is at present available on amounts up to £2,750 expended on housing provided for employees, &c, on agricultural or pastoral properties or in the vicinity of a port or harbour from which pearling operations are conducted. For the 1960-61 and subsequent income years, the 20 per cent. depreciation will apply to expenditure up to £3,250 for each employee, share-farmer or tenant. Expenditure in excess of £3,250 will be subject to depreciation allowance at normal rates. The estimated cost to revenue for a full year is £10,000 but there will be no cost for 1960-61.

Sales Tax

To assist certain classes of disabled persons, it is proposed to provide an exemption from sales tax on motor cars for use in personal transportation to and from gainful employment. The exemption is to apply where a person has lost the use of a leg to such an extent that, in the opinion of the Director-General of Social Services, he is unable to use public transport. This measure of taxation relief will assist a considerable number of persons to become usefully employed. The exemption will, it is estimated, involve a revenue loss of £265,000 in a full year and £210,000 tor 1960-61.

A reduction of the rate of tax from 25 per cent. to 12½ per cent. is proposed for silver-plated ware, pewter and cut-glass ware. The estimated cost of these reductions is £150,000 in a full year and £120,000 in 1960-61.

The dairying industry will be assisted by a proposed exemption of tanks which form part of bulk milk tankers used in transporting bulk milk from farms. The exemption will not apply to the motor vehicles to which the tanks are fitted. The estimated loss of revenue is £20,000 for a full year and £16,000 this financial year.

It is further proposed to grant exemption of water de-salting apparatus and of certain classes of goods imported from Christmas Island. Exemption is also to be allowed in respect of goods imported into Australia by the International Atomic Energy Agency and by certain officials of that organization. These exemptions are estimated to involve a loss of £6,000 in a full year and £5,000 for 1960-61.

A change is proposed in the method ot taxing radio valves. At present, valves made in Australia are exempt from sales tax but are subject to excise duty of 2s. 9d. each. Imported valves bear a similar levy embodied in the customs duty to which they are subject. It is proposed that the excise duty, and that part of the customs duty which is equivalent to the excise duty, shall be superseded by a sales tax of 25 per cent. This is the rate of sales tax which is payable on wireless receiving sets. An exception will be made for certain valves of a kind which are used only in transmission. These valves will be subject to sales tax at the general rate of 12± per cent. The net effect on revenue is estimated to be a gain of £300,000 for a full year and £100,000 for the current financial year.

An increase in the rate of sales tax on electric shavers from 12i per cent, to 25 per cent, is proposed. This will remove the competitive advantage those goods now have over safety razors and safety razor blades, which are already taxed at 25 per cent. The estimated gain to revenue is £290,000 in a full year and £230,000 for 1960-61. In total, the net effect of the foregoing proposals is estimated to be an addition of £40,500,000 in a full year and £36,600,000 in this financial year.

page 32

AIR NAVIGATION CHARGES

At present the. annual cost of maintaining and operating the airport and airway facilities used by the air transport industry exceeds £13,000,000, and it has been rising year by year. Against this outlay, the users pay some £700,000 a year in air navigation charges. There is thus a heavy net burden on the Commonwealth Budget, and it is growing.

Air transportation has made remarkable headway in recent years and can now be regarded as a well-established industry. There is no essential reason why it should not make a progressively greater contribution each year towards the cost of ground facilities provided at public expense. After reviewing the position, the Government has therefore decided to adopt a policy of full recovery from’ the users of the cost of facilities attributable to their operations. This aim will be achieved over a period’ of years. Each year there will be a review of the air navigation charges payable by the airlines and, as a first step, it is proposed to amend the Air Navigation Charges Act to increase the level, of these charges. The additional revenue to be obtained is estimated at £450,000 in a full year and £300,00 in 1960-61.

page 32

OVERALL RESULTS

If additional revenue of £36,900,000 is obtained this year from increased taxation and charges, total estimated cash receipts become £1,812,000,000 and, with total cash expenditures at £1,796,500,000, the net result for the year will be a surplus of £15,500,000.

In the Consolidated Revenue Fund estimated receipts would exceed expenditures ordinarily charged to that fund by £1’25,743,000. It is proposed to appropriate this amount to the Loan Consolidation and Investment Reserve where it will be available to assist in financing the amount required to support Loan- Council programmes for this year and to meet other contingent expenditures that may arise, such as an excess of debt redemptions over the amount available to meet them from the National Debt Sinking Fund. So far as it is not required for these purposes, it will be used to redeem outstanding Treasury bills.

Debate (on motion by Senator McKenna) adjourned.

Senate adjourned at 8.54 p.m.

Cite as: Australia, Senate, Debates, 16 August 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19600816_senate_23_s18/>.

View PDF View XML View in Voyant