Senate
31 August 1960

23^rd Parliament · 2^nd Session

QUESTION
- PARLIAMENTARY ALLOWANCES
QUESTION
- ELECTRIC POWER CELL
QUESTION
- BEEF
QUESTION
- PORT DALY AND ADELAIDE RIVER
QUESTION
- MOUNT ISA TO TOWNSVILLE RAILWAY
QUESTION
- DRIED FRUITS
QUESTION
- BALL POINT PENS
QUESTION
- PAPUA AND NEW GUINEA
QUESTION
- ATOMIC ENERGY COMMISSION
QUESTION
- CIVIL AVIATION
QUESTION
- WHEAT
QUESTION
- PARLIAMENTARY ALLOWANCES
QUESTION
- REPATRIATION
QUESTION
- CONSULAR SERVICE
QUESTION
- MINING
QUESTION
- REPATRIATION GENERAL HOSPITAL, HEIDELBERG
QUESTION
- JAPANESE TOYS
QUESTION
- INTERNATIONAL TRADE FAIR
QUESTION
- SUPERANNUATION
LEAVE OF ABSENCE
BELL BAY ALUMINIUM WORKS
MINISTERIAL ARRANGEMENTS
ESTIMATES AND BUDGET PAPERS 1960-61
ADJOURNMENT

The DEPUTY PRESIDENT (Senator the Hon. A. D. Reid), took the chair at 3 p.m., and read prayers.

page 299

QUESTION

PARLIAMENTARY ALLOWANCES

Senator O’FLAHERTY:
SOUTH AUSTRALIA

– I direct a question to the Minister representing the Minister for Labour and National Service. I preface it by saying that last night, when the Minister was replying to my protest against the increased charges of £11 10s. per fortnight made by Commonwealth Hostels Limited, he said -

The rise in charges at government hostels and other places exemplifies the fact that when marginal increases are made and the cost of services increases accordingly, the cost to guests in hotels also must rise. Those rising costs, I am reminded by Senator Kendall, have been matched by increased allowances which, as I have said, more than cover the charge.

Because I think that that was a premeditated prevarication, I ask the Minister: Can he inform me when the increase in allowances of which he spoke was provided for members? How much was the increase? When will it be paid? What department will pay the increased allowances?

Senator GORTON:
Minister for the Navy · VICTORIA · LP

– To the best of my knowledge, allowances were increased at about the time that parliamentary salaries were increased last year. The Canberra allowance for members of the Parliament was raised to £4 per day, which more than covers the amount that Senator O’Flaherty said last night he and his wife had to pay for accommodation. The allowance is being paid now. It is being paid, 1 believe, from the vote for the Parliament.

page 299

QUESTION

ELECTRIC POWER CELL

Senator BRANSON:
WESTERN AUSTRALIA

– I ask the Minister for National Development: Has- his attention been directed to an article in Monday’s edition of the “ West Australian “ which stated that a British inventor had produced a power cell which would revolutionize electricity costs by making one unit of power do the work of ten, and that the inventor, Mr. Walter Watson, had said that Australia, New Zealand and Israel had inquired whether they could make this cell under licence? Is the Minister in a position to tell the Senate what type of cell this is?

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

– I saw the newspaper report and I read it with a great deal of interest, but I have to say that I am not sufficiently well equipped technically to understand the process that is involved. I do not know to what extent it is well regarded or supported by professional opinion in the engineering world. If the honorable senator puts his question on the notice-paper I will endeavour to obtain some information for him. However, from the casual inquiries that I have made about this matter I gain the impression that what is contemplated by the inventor is not as yet understood or well known in Australia.

page 299

QUESTION

BEEF

Senator McMANUS:
VICTORIA

– Last week, in reply to a question, the’ Minister representing the Minister for Primary Industry promised to obtain certain information concerning the future of the beef industry. I now ask the Minister whether that information is available and, if it is, whether he will give it to me.

Senator GORTON:
LP

– The Minister for Primary Industry has supplied the following answer: -

It is generally agreed by meat industry authorities that the current beef shortage in Australia is due mainly to the poor seasonal conditions experienced over the last four years and, to a much lesser extent, to the heavy slaughterings in 1959 -for manufacturing beef for the United States market. The present shortage of both store and slaughter cattle was discussed at length at the meeting of the Australian Agricultural Council in July last. The council considered that the recent rate of slaughter should not be viewed with alarm although the population developments needed watching. The council agreed that the Department of Primary Industry, in consultation with the State departments, should survey the situation and endeavour to assess the future outlook.

The livestock population figures have now been published by the Commonwealth Statistician for the year ended 31st March, 1960, and these would indicate that allegations which have been made recently by some individuals concerning the wholesale slaughtering of useful breeding stock have been somewhat exaggerated. According to the figures, beef cattle numbers increased by 222,000 head during the twelve months to 11,600,000 head, while total breeding cows, including young heifers, increased by 220,000 head to 5,600,000 head, which is an all time record. On the other hand, the herd composition figures do suggest that a very high slaughtering rate has occurred for steers, young bullocks and cast-for age cows but it is not possible to tell from the data available which particular category has been subject to the greatest increase in the level of slaughterings.

The Government’s offer to the dried vins fruits industry of a stabilization plan identical with the one which was submitted to a referendum of growers in August, 1957, is still open. On that occasion, although a high percentage of those voting favoured the plan, the total number of votes in favour did not reach the minimum number required to carry it.

The secretariat of the Australian Dried Fruits Association recently advised my colleague, the Minister for Primary Industry, that the matter of an industry stabilization plan is being referred to its various branches to ascertain the growers’ wishes, and that the growers’ views will be considered at the association’s annual federal council next November.

The commission’s Isotopes Advisory Service is at the present time carrying out studies of the flow of effluent in Cockle Creek for the Sulphide Corporation by means of the now well established radio-active tracer techniques.

These techniques involve the. addition of a small quantity of a suitable radio-active material to the volume of fluid in which it is desired to trace the flow pattern. In the present experiment the tracer used is a radio-active isotope of gold.

There is no health hazard arising from these operations as the equipment used for detecting the resultant activity is so sensitive that the levels, of radio-activity at which the experiments are carried out are well below the internationally accepted standards for drinking water.

The commission does charge a fee for its services based on the work involved.

Senator HENDRICKSON:
VICTORIA

asked the Minister representing the Treasurer, upon notice -

When will the 1959 annual report of the Superannuation Board be tabled in Parliament?
Will the Treasurer have a statement prepared showing the number of former contributors to the Superannuation Fund who are enjoying their pension rights and who, while employed in a parttime capacity by some Commonwealth instrumentality, are paid on a “ fee “ basis and whose pension payments are not reduced because of such employment?

Senator PALTRIDGE:
LP

– The following answer is now supplied: -

The annual report of the Superannuation Board for the year ended 30th June, 1959, was tabled in the House of Representatives on 18th May, 1960, and in the Senate on 19th May, 1960.
Thirty-two pensioners under the Superannuation Act are presently receiving their full pensions in addition to remuneration for part-time duties with various Commonwealth instrumentalities.

page 304

LEAVE OF ABSENCE

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

Thai Senator Sir Alister McMullin be granted leave of absence for two months on account of absence overseas.

page 304

BELL BAY ALUMINIUM WORKS

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

– by leave - For some time negotiations have been proceeding between the Governments of the Commonwealth and Tasmania and the Commonwealth Aluminium Corporation Proprietary Limited - Comalco - for the purpose of obtaining the introduction of private capital to enable major expansion of the Bell Bay aluminium plant to be undertaken. This has resulted in the Commonwealth receiving an offer from the Consolidated Zinc corporation, a partner in Comalco, under which a company to be formed by Consolidated Zinc and the Tasmanian Government would acquire and expand the plant. The offer is acceptable in principle to the Commonwealth Government. The proposals also have the support in principle of the Premier of Tasmania.

The Bell Bay plant is operated by the Australian Aluminium Production Commission, which was set up by an agreement of 1944 between the Commonwealth and Tasmanian Governments. The Commonwealth act setting up the commission and authorizing the intergovernmental agreement is the Aluminium Industry Act 1944-1956.

The plant at Bell Bay produces aluminium ingot and some alloys and special shapes. Its capacity is 12,500 tons of ingot per annum. It first came into production on 22nd September, 1955, and to 30th lune, 1960, has sold about 50.000 tons of metal. The partner governments and the commission are well aware that on the present scale of operations the plant is not economic. It is therefore no reflection on the commission that the undertaking has not, in fact, proved to be a con.spicuously successful venture commercially. The total capital investment in it is £11,200,000 of which the Commonwealth has made the major contribution, £9,700.000, Tasmania having contributed £1,500,000. The profit of the commission in 1958-59 was only £158,734. In past years the operation of the undertaking has not been sufficiently profitable for the commission to pay interest to the partner governments on their investments as was originally envisaged.

The plant is at present being expanded to a capacity of 16,000 tons of ingot per annum, the Tasmanian Government providing most of the funds for this purpose. However, a much higher production rate than this is needed, involving substantial new investment not only in the plant itself but also, by the State Government, in electricity supplies, housing and utility services. The Commonwealth Government naturally wishes to see the finance for the plant come from private rather than government sources. Although the plant was initially constructed by the governments as a defence measure its function now is to supply the Australian economy with an ordinary commercial product and there is no valid reason why the venture should continue as exclusively a government operation.

Moreover, the discovery in 1955 of the very large bauxite deposits at Weipa and Gove in Northern Australia and the investigation of other deposits, including those in the south-west of Western Australia, provide the basis for the development of a major industry in Australia based on the production of aluminium and fabricated products from our own bauxite deposits.

The enlistment of private enterprise in the expansion of Bell Bay is a major step in this direction. Plans for full-scale development of our bauxite resources are still in the formative stage; however, Comalco is already proposing the first large development of the north Australian deposits by the investment of at least £34,000,000 in the establishment of a port, township and alumina plant at Weipa, Queensland. Our bauxite resources and the projects now beginning to come forward which will promote their development offer the promise of dramatic growth of a great industry.

Comalco is a joint venture in which the partners are the British Aluminium Company Limited - formerly technical adviser to the Australian Aluminium Production Commission - and Consolidated Zinc Proprietary Limited. Consolidated Zinc Proprietary Limited is a wholly owned subsidiary of Consolidated Zinc Corporation Limited, a company predominantly owned in the United Kingdom but listed on the Australian stock exchanges, with some 12 per cent, of its share capital held in Australia. The negotiations with Comalco have resulted in one of the partners in Comalco, Consolidated Zinc, with the concurrence of British Aluminium and after consultation with the Tasmanian Government, submitting to the Commonwealth an offer under which a company comprising Consolidated Zinc - two-thirds interest - and the Tasmanian Government - one-third interest - with a nominal capital of £10,000,000, would be formed to take over the Bell Bay undertaking as a going concern and to expand its capacity from 12,500 tons of ingot a year initially to 28,000 tons at a cost of £9,400,000, with the objective of later expanding to between 40,000 and 50,000 tons.

The amount offered for the undertaking is the full amount of the capital contributions of the two governments less the value of certain mineral deposits which are held by the commission outside of Tasmania and which are not to be included in the assets the company would acquire. The purchase price is £10,973,000 payable as follows: -

The Premier of Tasmania has intimated that he expects his Government will, subject to examining details, endorse the proposal that the Tasmanian Government take a one-third interest in the undertaking. This interest is subject to a proviso that the Tasmanian Government will not be under an obligation to find more than £3,000,000 in shares or loans in the stage to the production level of 28,000 tons a year.

Interest on the outstanding balance from year to year would be 5 per cent, per annum provided sufficient profit is earned to enable the company to pay the modest dividend of ti per cent, to shareholders.

Interest on loans by shareholders is restricted to 6i per cent, a year. Half of any profits after payment of 6£ per cent, dividend would be available to pay any arrears of interest. No interest would be payable, i.e. arrears, once the purchase price has been fully paid.

Estimates of the result of these provisions have been made. However, it is impracticable to make an accurate forecast of the interest the company would be able to pay because this will depend on the trading fortunes of the company, its costs and the prevailing price levels, but on such estimates as may be made it is possible that the full amount of interest after expansion to 28,000 tons and a considerable amount towards arrears may be paid.

Consolidated Zinc has asked that the industry be protected only in the period, estimated to be four years, in which the expansion works would be in progress. Thereafter the company would hope to operate the plant profitably enough to be able to pay its shareholders 6i per cent, dividend without the benefit of protection, and has agreed not to seek protection after the expansion period except in abnormal circumstances. The security offered is a first charge over the fixed assets, old and new, of the undertaking, the Government to consider a reduction in the security given as the purchasing price is paid off.

Contributions by the Tasmanian Government to the current expansion programme to 16,000 tons would be treated as investment by it in the new company, which would also take over the technical agreement just negotiated by the commission with the Swiss firm Aluminium Industries Aktien Gesellschaft, under which A.I.A.G. will provide technical assistance to the commission in connexion with the present programme for expansion.

Consolidated Zinc’s policy is to continue to employ the commission’s employees. On taking over the plant the new company would offer employment at not less than the current rates of remuneration to all the employees of the commission, and would also ensure to them rights in relation to superannuation, furlough, recreation and sick leave.

The Government is pleased that Consolidated Zinc is taking such an intense and active interest in aluminium production in Australia. This firm has played a notable part in the Australian mining industry.

The Aluminium Industry Act 1944-1956 provides - a sale or disposal of the undertaking of the Commission . . . shall not be effected except with the approval of Parliament.

The Government has decided that the offer by Consolidated Zinc is acceptable in principle, subject to further discussion with Consolidated Zinc and Tasmania concerning points of detail. These further discussions and the preparation of the necessary legal documents will take some time. When the parties have reached agreement on all points the appropriate legislation will be placed before the Commonwealth Parliament.

Mr. Deputy President, I lay on the table the following paper: -

Bell Bay Aluminium Works - Proposed sale to Consolidated Zinc Pty. Ltd. and the Tasmanian Government - Ministerial statement dated 31st August, 1960.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move -

That the paper be printed.

I ask for leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

page 306

MINISTERIAL ARRANGEMENTS

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

– by leave - I desire to inform the Senate that the right honorable the Treasurer (Mr. Harold Holt) will leave Australia to-night on an official visit overseas.

In London he will attend a meeting of the Commonwealth Economic Consultative Council, at which other Commonwealth finance ministers will be present. Later he will preside at the annual meetings of the boards of governors of the International Monetary Fund, the International Bank for Reconstruction and Development and the International Finance Corporation. He will also open the seminar for prominent European businessmen, which the right honorable the Minister for Trade has arranged in association with the Lausanne Fair, at which Australia is guest exhibitor this year.

During the absence of the Treasurer the Prime Minister will act as Treasurer. He will secure the assistance of another minister in handling the detailed administration of the department.

page 306

ESTIMATES AND BUDGET PAPERS 1960-61

Debate resumed from 30th August (vide page 294), on motion by Senator Paltridge -

That 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 - be printed.

Senator PEARSON:
South Australia

– When the Senate adjourned last night, I was dealing with the unfortunate position in which our primary industries find themselves. I had urged the Government to initiate a thorough investigation into the extent of the burden which primary industries bear as a result of the Australian tariff policy. I said that although I did not quarrel with this policy, I did think that it placed a burden on primary industries, which were casting about for ways and means to reduce their costs of production. They had no escape from the burden, and they could not pass it on to the community. They receive only a very small amount of protection but are expected to provide the lion’s share of our exports. In 1959-60, primary industries provided about 80 per cent. of Australia’s exports, worth about £749,000,000 out of a total export income of about £900,000,000. Primary industries paid directly for most of the protection afforded to secondary industries, which provide only a small share of our exports. In my view primary producers are entitled to know the full extent of the burden with which they will be faced, and I hope that they will be told this by the investigating body which I have urged the Government to establish.

Primary producers must abide by awards of the arbitration court, but they are unable to pass on to the community the added costs arising out of those awards. Primary producers, for various reasons, have been unable to present their case to award-making tribunals in the proper fashion. If an) further increases in award wages are granted’ by tribunals’, incalculable harm will result to our exporting industries. I suggestto the primary producers’ organizations in Australia that they unite and set .up a federal secretariat, which would collate costs and other data to be presented to the arbitration court. I make a plea - I do not apologize for doing so - that these matters be investigated.

I should like to have seen in the. Budget an announcement that the Government had agreed to pay a superphosphate bounty. Such a bounty has been urged by a number of Government supporters for many months. It would apply to all users of superphosphate in the various primary industries throughout Australia and would be the fairest and most equitable - certainly the most direct - means of assisting primary producers, who are faced with everincreasing costs, but who are powerless to do anything about them. They must sell their products on the extremely competitive markets of the world. Not only are they faced with rising costs at home, but they are faced also with falling prices abroad. This is a matter which I regret was not touched upon in the Budget.

I should like to say something about sulphuric acid manufactured from indigenous sulphate-bearing materials. In 1952, the then Minister for Defence Production gave repeated assurances to the manufacturers that their industry would be completely protected by a flexible provision in the Sulphur Bounty Act, under which the bounty would rise and fall as the cost of imported brimstone rose and fell. On 14th January, 1952, the Minister said -

The Commonwealth Government gives a definite assurance that they-

– The last time he was elected to this chamber-

Senator McCallum:

– Mr. Acting Deputy President, I raise a point of order. That is a deliberate lie, and I ask for its withdrawal.

The ACTING DEPUTY PRESIDENT (Senator Andersen). - Order! An honorable senator must not say that another honorable senator is associated with communism if such a statement is offensive to him. I ask the honorable senator to withdraw that statement.

Senator HENDRICKSON:

– If I was elected by the preferences of candidates of an organization, I could certainly be accused of being allied with it in some. way.

The ACTING DEPUTY PRESIDENT. -Order!

Senator McCallum:

– I again ask that the statement be withdrawn. There is no connexion between what the honorable senator now says as justification for his lie and his original statement.

The ACTING DEPUTY PRESIDENT. - Order! Senator Hendrickson, I rule that you must not reflect upon another senator. You must withdraw the statement that Senator McCallum is connected with communism.

Senator HENDRICKSON:

Senator HENDRICKSON:

– So was I.

I was where you were; I was in France. I do not refer to things that I know nothing about. I do not know how Senator McCallum learned of these things if he was out of the country then. He was in the Labour Party later, but he got out, as I am reminded by Senator Nicholls.

This Budget should be known as the terrible Budget. Its introduction has been made possible only because this Government has not faced the electors of Australia since 1949 on the basis of giving: an account of its stewardship at Canberra. We know the promises that the Government parties made in 1949. I hope that I shall have time to refer fully to them at a later stage. Since 1949, when all those promises were made, this Government has never gone before the electors to tell them about its stewardship here. In order to delude the electors, the Government parties have used the scare of war; they have used the Petrov commission; they have used the bogy of communism; and- they have used the Democratic Labour Party. They will use anything at all as long as they are able to cling to the treasury bench.

Senator McKellar:

– We do not have to use unity tickets.

Senator HENDRICKSON:

– A Government senator talks about unity tickets. As I said before, Senator McCallum was elected to the Senate on the preferences of the Communist Party in New South Wales. There is the unity of the Liberal Party and the Country Party, and there is the unity of those parties with the Democratic Labour Party. Where does the unity ticket come in? They will unite on anything that will keep them on the treasury bench. Senator Mattner is interjecting. He would not know what a unity ticket is, because he has never been in a union and does not understand the position.

What has happened in recent years shows how right the Labour Party was during the years from 1945 to 1949. We know that until 1945 or 1946, before controls were lifted, the economy of this country was one of the soundest in the world. When the prices referendum of 1946 was defeated, prices started to rise. We warned the people of Australia that if they did not have controls during the post-war period, prices would rise. The countries of the world were stock-piling materials for another war. Europe had been devastated. We knew that overseas countries would want our meat, wheat and other foodstuffs, and that those things would bring very high prices. We initiated a policy that would at least have prevented inflation in this country.

What we wanted to do with the powers that had been given to us by the people of Australia was to control prices in this country until such time as the economy was restored to normal. We could not hope for normality until at least six or seven years after the war. We believed that if it was necessary to control prices during the war, it was doubly necessary to control them for a few years during the post-war period. During war-time, 99 per cent, of the people are patriotic and are prepared to do anything to help to win the war, but in peacetime it is very difficult to get some people to do things for the benefit of the nation. We knew that because the workers of Australia had been deprived of a. decent living standard during the depression years, under an anti-Labour government, when the little nick-nacks with which they had to do without during the war became available again, they would pay any price for them and so ruin our economy. Therefore, we asked the people to give us power to exercise controls until our economy became stabilized again. We did not want to exercise controls for a longer period than was necessary.

Now, because of the maladministration of this Government, we are forced to accept i this Budget. We cannot do anything else, lt is futile to offer worth-while criticism of the Budget, because the money has to be found to meet the obligations of the Government. 1 venture to say that if a Labour government had been in office for the last ten years, Australia would have a better economy to-day. The total amount involved in this Budget, in round figures, is £1,775,000,000. The last budget introduced by a Labour government was in 1949, and the amount involved was £500,000,000. The Budget of this country has increased from £500,000,000 in 1949 to £1,775,000,000 in 1960. We said in 1949 that we still had to do something to control the economy of the country, or we would become insolvent and unemployment would occur again. We warned the people. Now, history is repeating itself. We remember the 1920’s and the bad old 1930’s. We also remember that when supporters of the present Government were in office during the First World War warnings were given about inflation, but the Government did not heed them and it was left to the Labour Party in 1929 to come into this Parliament - we did not have a majority in this chamber - to rectify the economy of the Commonwealth of Australia.

Senator Kendall:

– Did you say wreck?

Senator HENDRICKSON:

– To rectify the economy of this country. I say to honorable senators who are interjecting that sometimes a doctor has to do drastic things to restore a patient’s health. Mr. Scullin, be it ever to his credit, did a magnificent job under great difficulties and in spite of the people who worked against him.

Senator McCallum:

– Who destroyed him?

Senator HENDRICKSON:

– The same people who destroyed the party again later.

– The people who undid my work of defeating Jackie Brown were the people we put there. They formed their own group, and if you did not belong to the group you could not stand for any official position in a trade union. That was the trouble.

The propaganda that has been put to the people of Australia is the bogy of Communism. In 1949, when the elections were over we were told that the value of the Chifley £1 compared with that of the £1 prior to the outbreak of the Second World War was only 13s. 4d. It might have had that value for people who possessed a quid, but there were not too many such people, because when war broke out 300,000 were unemployed in the Commonwealth, that is after ten years of Liberal government. But supposing the Chifley £1 was worth 13s. 4d., what is the value of the Menzies £1 to-day?

Senator Kendall:

– Take it in comparison with wages and you will get somewhere near it.

Senator HENDRICKSON:

– If the honorable senator will be a little patient he will find I intend to do that. The value of the Menzies £1 to-day is only 5s. 6d.

Senator Mattner:

– I will give you 5s. 6d. for it if you like.

Senator HENDRICKSON:

– 1 would not trust you with £1 because I know what you would do with it. The value of the Menzies £1 is only 5s. 6d. compared with the value of 13s. 4d. of the Chifley £1 in 1949. The basic wage to-day is only £13 lis., but in terms of purchasing power of the Chifley £1 it should be £15 a week.

I agree with a great deal of the honorable senator’s diagnosis, but I do not agree with the prescription. The prescription that he gave us was, in effect, a prescription for a centralized form of .government which could in the final resort lead to a totalitarian state. Unfortunately, for many years the Opposition, and many thoughtless people who do not analyse things, have given great publicity to the idea that you can improve everything by increasing the power of the Federal Government. That goes back to the very early days of the Labour Party. I disagree with that idea, even though once I agreed with it. I am no longer m the Labour Party.

I can recall William Morris Hughes, who was then Attorney-General and Deputy Leader of the Labour Party, and really the vital energetic power behind it, as early as 1911 bringing forward proposals to amend the Constitution. He proposed the transfer of a number of powers from the States to the Federal Parliament. In my youth and innocence, I was misled by the Welsh witchcraft of Mr. Hughes and I was enthusiastically behind that proposal at the mature age of, shall T say, fifteen years. But we have survived. Those powers were not transferred. The Australian Commonwealth has continued in existence and to-day our economy is infinitely greater than I believe anybody thought it would be at this day.

This programme of centralization is one of the stock specifics that we constantly get from the Opposition. I believe it is the duty of the honorable senators on this side of the chamber and of the sober citizens of the Commonwealth to oppose it. Let us take any of the specifics that Senator McKenna mentioned. If a properly drafted amendment of the Constitution were brought forward I, and I think most honorable senators on this side, would carefully consider it. If we thought that that one specific measure would increase the powers of the Government in dealing with the economy, we would support it. But all six specifics could have no effect but to reduce the powers of the States, to take from them their rightful functions, and to establish a centralized bureaucracy. This Parliament has enough to do as it is. I agree with Senator McKenna when he says that, if a specific amendment would make it easier for us to do something and would allow us to avoid a certain result, it would be much better to adopt it. But to adopt all those measures would simply mean destroying the federal basis of the Constitution. 1 think I could well spend my time in trying to show that the federal basis of the Constitution is necessary to this country. It is only very loose reasoning which makes people think otherwise. People talk as though a national outlook and the desire to put Australia as a whole above any part of it necessarily mean that we should weaken the local authority and strengthen the central authority. It does not mean that at all. It is far better for the local authority to deal with many matters. I am tired of hearing the cliches - unfortunately, in a well reasoned speech, Senator McKenna repeated some of them - in which it is suggested that the Constitution is outmoded, that the people who drew it up did not know what they were doing, and that they copied the American Constitution to too great a degree. The men who drew up our Constitution were very wise. I am not one of those people who think that nil the giants died yesterday, but the men who conceived the idea of federation, who fought it through and who made it popular with the mass of the people, were very great men. Even people like Reid of New South Wales, who bargained and insisted that if their State came in it was not to be neglected, all took part in this great work of drafting our Constitution. To mention their names ought to be more than a mere echo of the past to the mind of every patriotic Australian.

I mention the name of Parkes of New South Wales, who conceived the idea and pushed it forward and on his death-bed bequeathed his banner to Barton, who then took up the struggle. 1 have already mentioned Reid, who in some ways appeared to to be an opponent of those who were in favour of the Constitution but who really desired federation and ultimately piloted the necessary legislation through the New South Wales Parliament. I think also of Griffith of Queensland, who in one sense was the real father of the Constitution, because he drew up the original draft in 1891. He could not appear at later conventions, because Queensland did not send delegates to the 1897 convention when Griffith was Chief Justice of that State. Holder, Downer, Kingston, Forrest, and Braddon of Tasmania, all were very great men. It would do every one of us a lot of good to read the reports of the conventions and to see what was in their minds when they conceived the idea of the Constitution.

They did copy the American Constitution where they thought it fitted our needs. But they copied the British Constitution, too. For example, they would not think of having the presidential form of government. In view of the great difficulties that are being experienced to-day and the strain that is imposed by the presidential system on a great nation in an hour of crisis, I believe they were very wise in that respect. In relation to certain matters they followed the pattern provided by their own colonial parliaments. For example, although we copied the American system in having equal representation from each of the States, we did not copy the American method of having the State legislature elect the senators. From the beginning, we chose popular representation elected by the people. Some twelve years later, the Americans themselves, under the leadership of Woodrow Wilson, adopted our pattern.

The Australian Constitution is a great constitution, and I believe that, instead of this continual sneering at it, we should have some of the respect that the Americans have for their constitution. We should be ready to amend it where it is clearly proved that the amendment would be of benefit to the whole community, but not act blindly with the idea that the centralized government is always right and the localized government is wrong.

Senator Ormonde:

– But this Government appointed a committee to review the Constitution.

Senator McCALLUM:

– 1 shall refer to that later. Last night, one honorable senator referred to the British Constitution as being unitary and as giving the British Parliament sovereign rights. Senator Lillico answered one part of that statement by saying that, after all, Great Britain is a small country and a unitary constitution could be more easily adopted there. But that is not the whole answer. The British Constitution has no federal basis. There is no written constitution in Great Britain in the sense that we know. It is a mass of understandings, conventions and laws and all kinds of other things. A famous Frenchman once said, “ The only thing about the British Constitution is that there is none “.

Senator Ormonde:

– It is unwritten.

Senator McCALLUM:

– But it is there. But 1 say in particular of the English - I happen to be of Scottish and Welsh descent - that it is in the genius of government that the English people are prominent. The British people have certain habits and ingrained customs, and every one knows that certain things will never be done. When Mr. Attlee assumed office as Prime Minister there were all kinds of wild alarms. Every one knew that he would carry through sweeping social reforms, and he received the support of many people who had never voted for him. As a matter of fact, the strongest support for many of his purely social measures came from Lord Samuel, the Leader of the Liberal Party, who was the last of the greatest men of the greatest party that I believe ever existed. Ever one knew there would be no revolution, that the monarchy would not be overturned and that normal life would go on. That was because of something in the British character and the British temperament. Moreover, the British Constitution grew out of local government.

We in Australia have inherited many of the habits of our ancestors. Most of us are of British descent. We began life in Australia as members of small communities autocratically governed. That was true of every one of the separate colonies. That state of affairs grew out of sheer necessity. Furthermore, our people, whether they came from Great Britain or other countries, in many ways had been uprooted from their old traditions and it was not until some years after the early settlement that the old traditions began to establish themselves. Some have not been established even yet. We have not yet learned how to use local government as well as the British people do. However, we are learning, and I hope we shall learn completely in time.

Take one matter only. In England, a justice of the peace is a very important person. His office goes back through the centuries, and it is a great honour to be a justice of the peace there. I suppose that quite a number of us here are justices of the peace, but nobody in Australia seems to think that that is a great honour, except in Western Australia. I believe that in Western Australia - I know that it was the case some years ago - such a high standard is set that the office of justice of the peace is regarded with something of the respect with which it is regarded in England. I remember being asked to approach the then Premier of Western Australia, Mr. Collier, in order to obtain the appointment as a justice of the peace of a gentleman who was collecting such appointments. He had the appointment in every other State and he thought he should have it in Western Australia. The reply that I got was this: “ He has as much chance of getting the office of justice of the peace in Western Australia as he has of being a Knight of the Garter”. I thought that that was an excellent reply. He did not get it. I did no press his application, but just handed his letter on to the Premier.

The United Kingdom consists of four distinct countries. Northern Ireland has a parliament of its own that administers many things. Scotland gave up its parliament. but it did so by a treaty which was embodied in two acts of parliament, the Scottish and the English. Those acts lay down certain things that the House of Commons could sweep away to-morrow, as far as legal power is concerned, but we know that it will not do that because the treaty is regarded as a solemn treaty. The Scottish law courts and legal system are quite distinct from those of England. The Scottish education system is also distinct from that of England. It was the most magnificent system in the world and is not so to-day only because other countries have copied it. It is a purely Scottish system. Our education system in New South Wales, particularly our system of secondary education, was very largely modelled on the Scottish system. The Scottish Church is a separate church, and the first act of the Sovereign, before he or she is crowned, is to take an oath not to alter that.

So, by a different method from ours, the British people have their liberties conserved. I hope that the time will come in Australia when we are so firmly entrenched in the ancient customs that we consider right that we will not need written constitutions or anything of that nature. But we need them now. They have been needed in America. Look at the American Constitution. It is 171 years old. It has seen that great nation develop from a country with a population of 3,000,000 people to a country wilh a population of 170,000,000 people. It has carried the country through great crises - through the long struggle about slavery, through the civil war, through all the social disturbances that came with the rising of the trusts and the breaking down of the old system of competition and, I think, its re-assertion, largely through the action of Congress. The American Constitution is facing to-day two great problems. It is facing the great totalitarian State of Russia and it is also facing a terrible internal crisis concerning the civil rights of negroes. I do not believe that America could have achieved what it has achieved if it had had a unitary constitution. America would have broken asunder; it would have gone into a state of anarchy or would have become a tyranny.

We have done very well with our federal Constitution, but I wish people would not confuse the functions of the State and

Federal Parliaments. I am constantly beset by letters urging me to get more money for education. I believe that there should be more money for education, and 1 point out, as a senator did last night, that under the new formula the States will have £30,000,000 more than they received last year. The people who are petitioning and pressing the Federal Parliament should press their State Parliaments to allocate a proper portion of that amount to education. It would be a disastrous step, in my opinion, for the Federal Government, without the invitation of the States, without the consent of the States, and without proper consultation with the States, to say, “ We are going to give you money on condition that you use it for this particular purpose, which is one of your functions “. Let us have adequate finance for the States. If it is not adequate, let us have conferences, consultations and amendments of the law, including amendments of the Constitution, if necessary, in order to give the States adequate revenue, but let the State Parliaments and the State Governments have their own responsibilities in regard to everything that is properly a State function.

I think that I have answered the case of the Leader of the Opposition. I believe that some of the matters that he mentioned could be the subject of an amendment, but I would certainly not give my support to any amendment until it was framed and I knew exactly what effect it would have. I remember that I voted, most enthusiastically, for the Financial Agreement of, I think. 1928. It was during Mr. Bruce’s Ministry and, was. I think, one of the last acts of that Ministry. I would still vote for it. I thought that it was necessary. But I had not at that time any notion of the far-reaching effects that it would have, nor. I think, did many of the other people who supported it.

We must be careful about every referendum on a proposal to increase the powers of the Federal Government. I wonder why, in this talk of re-allocating powers between the State and Federal Parliaments, everybody seems to think that it is always a reform to increase the powers of the Federal Parliament but that it could not possibly be a reform to transfer some federal power to a State Parliament. I think that, in the main, the division was made pretty clearly and well at the beginning. I believe that federalism is the only way to make our liberties secure. There is a tremendous potential danger in a completely centralized bureaucracy, particularly if we get what members of the Opposition are pledged to get, that is, a one-House parliament, with possibly one party power drunk, having been out of office for a long time, and determined to show what it can do.

This system of checks and balances is a very good one. A great French philosopher of the 18th century laid it down. The Americans deliberately based their Constitution on it, as we did to some extent. Nothing has ever been produced to show that either the American Constitution or our federal Constitution is too weak to act in an emergency. If all the measures that Senator McKenna advocated were carried through, the Constitution might possibly be too strong in a time that was not a time of emergency, when the public were lulled to sleep and a power-drunk majority in a single chamber wanted to exert its power just for the fun of it.

An honorable senator opposite asked me about the committee that recommended certain changes in the Constitution. If and when any of those changes are proposed here, I shall consider them very carefully. There is one upon which I have made up my mind. An old, wise politician once warned a newcomer never to use the word “ never “, and I think that is fairly good advice, but I shall use one “ never “. I shall never agree to any amendment which will degrade this chamber and make it less important than it is at present in the government of this country, because I think that any such measure would be either consciously aimed, or unwittingly adopted by some one who did not know the aim, at ultimately abolishing the Senate and giving us a parliament with a single chamber. Furthermore, I do not think that the powers of this chamber are too great. I would make them greater. I wish I had been present when the Constitution was framed. I would have made it a little more American. The founders of the American Constitution deliberately gave to the United States Senate certain powers which they did not give to the House of Representatives or to anybody else. Those powers included the power to “ advise and consent “, which has been used to save the American Commonwealth from severe embarrassment.

Senator McKenna cited the figures in the Constitutional Review Committee’s report and said that certain things were adopted uanimously, some by a large majority and some with a minority of one. I remind the Senate that it was represented by only one private member from this side who would feel himself completely free. In reading the report I pay great attention to his opinion, although it is a minority opinion. Sometimes the minority opinion is the right one.

I conclude my remarks by saying that I deplore the constant attempts to give us centralized government, which in my opinion would lead to tyranny. I adhere to the principle of federalism. No matter what party ties have decreed in the past or what they may decree in the future, I hope that every honorable senator will remember that he belongs to a body which is not contemptible and which has a vital function to perform for this nation. I am proud to be a member of that body.

Senator SHEEHAN:
Victoria

.- The Budget, which is the important subject of discussion at the moment, affects our economy in many ways. Because it has far-reaching effects on our economy we are able, in this debate, to discuss a wide variety of subjects. Senator McCallum treated us to a very fine dissertation on the constitutional powers of the Commonwealth. 1 am almost tempted to follow him in some detail on that very important matter, but as we have an agreement not to over-indulge ourselves in debate on the day on which our proceedings are being broadcast, I will say simply that I congratulate the honorable senator on bringing the matter forward. It is a subject to which I have given some attention and in which I am deeply interested.

I support the remarks of my leader, Senator McKenna, who directed attention to the fact that there are great gaps in the constitutional powers of the Commonwealth. I think that Senator McCallum and those of us who have paid any attention to this subject will agree with that statement. It is well known that the Commonwealth has no power in peace-time over capital issues. I ask honorable senators to cast their minds back to the days of the last war. Authority is written into the Constitution enabling the Parliament of the Commonwealth to assume certain powers in times of great national emergency. The Labour Government led by the late Mr. John Curtin and the Liberal Government that preceded it exercised those powers to a certain degree. Possibly the Labour Government, faced with everincreasing problems, exercised those powers more extensively than did its predecessor. But was it not a valuable thing for Australia that the Commonwealth Government, charged with the responsibility of prosecuting the war and keeping Australia free, was able to exercise those powers?

To-day, Australia is in danger because of another enemy - not exactly a visible enemy but one that is slowly but surely overwhelming us. I refer to inflation, which the Prime Minister (Mr. Menzies) described as a creeping enemy. This is the enemy that we fear at the moment and which is the cause of our present troubles. The Parliament is helpless to deal with this matter. It has no control over capital issues. When we look around us to-day we see takeovers being effected in all directions, sometimes by issuing fresh capital and sometimes by other means, but always without any regard for the interests of the nation. The National Parliament, although afraid of inflation, is unable to take action in that respect. I understand that the Government proposes to dispose of its interest in the great Bell Bay aluminium factory for a mere £11,000,000. How ridiculous! A chain store organization in Melbourne has offered a similar amount to a grocery organization. The Government is going to give away a great national industry. That is the Government’s attitude in most matters.

We have no uniform company law in Australia. We should have a uniform company law in this country to deal with our present problems. The Commonwealth does not have adequate power over industrial relations. It does not have adequate power to control interest other than bank interest. Senator McKenna directed the attention of the Senate to those important matters. Do not honorable senators opposite appreciate that the Commonwealth needs those powers at the moment? The Leader of the Country Party - the Deputy Prime Minister in another place - has told the Parliament and the nation that our economy is balanced on a razor edge. Should we not have power to deal with these problems, or are we prepared to drift along, hoping for the best, as we did prior to the depression in the 1930’s? Eventually we will awaken to find that tragedy has overtaken us.

I could spend a long time discussing this” Parliament’s lack of powers. Unfortunately the Government, which appointed the committee to inquire into the Constitution, seems afraid to tackle the problem that has been exposed by the committee’s findings. I agree with Senator McCallum that the men who framed the Constitution were big Australians. They envisaged an Australia that would develop and become the great country of the Pacific. That was 60-odd years ago. At that time, Australians understood the State jealousies or colonial jealousies and all the problems with which they were confronted. The idea of federation was unheard of in this part of the world. There was only one other great federation in existence, and that was in the United States of America. The men who had been in the parliaments of the colonies were used to exercising unlimited power under the various State constitutions. Those constitutions conferred paramount power, but we are exercising delegated authority. I hope that before the conclusion of this session this Parliament will be given an opportunity to discuss the report, so that we may get together and go to the people and ask them to clothe the National Parliament with the powers which are necessary to preserve and develop Australia until it becomes the place we know it is destined to be, given good government.

When the Treasurer (Mr. Harold Holt) introduced this Budget in another place he used some very fine words, indeed. I had the pleasure of hearing him for a few minutes before I came into this chamber to hear the Minister for Civil Aviation (Senator Paltridge) deliver his speech. We know how anxiously the people were waiting for the presentation of this Budget. All sorts of rumours had been circulating about what the Government intended to do to grapple with the problem. The Treasurer commenced his speech by saying -

More than ever these days, the Commonwealth Budget has to be regarded as a means to guide the broad trend of the economy in the direction of certain well-established goals. It is common ground with all of us that we want to see a strong continuous growth of population and industry, rising standards of living, full employment of labour and such a degree of stability as will promote these aims and safeguard the share in the gains of progress to which every one is entitled.

They are very fine sentiments with which to open a Budget speech. They are sentiments that could be expressed by a Labour Treasurer, because they are the ideals of the Labour movement. However, as the speech proceeded one wondered what course was being followed through the labyrinth of words that fell from the Treasurer.

The net result was that no one has praised this Budget. Not one of the great metropolitan newspapers or the country newspapers - in fact no spokesman at all - has been enraptured by what is contained in the Budget. The finance editor of the Melbourne “ Herald “ referred to it as a damp Budget. The “ Age “ said it was a modest or moderate attempt to deal with inflation. I was interested in what the “ Taxpayers’ Bulletin “ had to say about the Budget. It said -

Because of the manner in which the nation’s accounts are prepared, the financial picture presented to Parliament in this week’s Budget is confused and perhaps misleading.

The Treasurer’s basic justification for retaining present taxes and imposing more taxes is that deficit budgeting is “out” and that last year’s cash deficiency must be converted to a cash surplus in 1960/61.

Quoting Mr. Holt’s figures in round millions, he disclosed a cash deficit for 1959/60 of £29m. (compared with last year’s estimate of £61m.); this he proposes to convert to a “ cash surplus “ in 1960/61 of £15.5m.

But these figures are the end result of an amazing conglomeration of revenue and capital items and of cash and credit entries that would horrify the auditor of a public company.

Those are the thoughts of the editor of that bulletin.

Senator Brown:

– He is not a Labour man, is he?

Senator SHEEHAN:

In recent times, some companies have offered to pay fabulous sums in take-over bids. Consider the recent bids that were made by Woolworths and Coles to Matthews Thompson and Company Limited. I think the bid originally made by Woolworths was about £8,000,000, and the successful bid by Coles amounted to about £11,000,000. Where do the companies get the money to enable them to make such offers? One could place before the Senate many interesting aspects of this matter.

I think that Senator Wedgwood will agree with me when I say that the Budget’s contribution to social services is simply disgraceful. Age and invalid pensioners are to be granted an increase of 5s. That will not buy an extra loaf of bread per day. The price of a small loaf is ls. 3d., and the pensioners are to receive an increase of about 8±d. a day. The Treasurer (Mr. Harold Holt has announced this paltry increase to pensioners, and yet we talk about prosperity in this country. The Treasurer told us that the expenses of pensioners had risen and that an increase in pensions was necessary even to meet increased expenses. What does that indicate? lt indicates that this wonderful, prosperous country - a country that is so prosperous that we are afraid of our own prosperity at the moment - is developing a race of people who, when they go out of industry, amass such a small percentage of this world’s goods that they are forced to accept social services in the form of an age pension, or whatever you like to call it. That is what we are doing to the people and yet the Treasurer in his grandiloquent remarks at the commencement of his Budget speech said that we must increase our standard of living, have1 full employment and do all sorts of things. Yet in the final analysis we find that after all this has been accomplished the only prospect the people have is the age pension.

Is it any wonder that there is in our community a section of people who want to change our present economic system? These people suggest that the parliamentary system of government under which we are living and working is a failure. Because we are failing the great mass of our people, they suggest that we change our system for something with which you and I do not agree. They want a more totalitarian system. Is it any wonder that they feel that our system is failing and that they should endeavour to bring in some other system? Conditions such as I have referred to led the people of some eastern countries to discard democracy and adopt communism. It is the conditions I have mentioned that nurture the growth of this theory. If the Government desires to do something to preserve this country it will have to give the people a better standard of living than they have at the moment. I regret that time precludes me from dealing with other matters that I would like to develop in this very interesting debate on the Budget.

Senator McKELLAR:
New South Wales

– I support the motion before the chamber for the printing of the Estimates and Budget Papers. At the outset, might I say that the Budget, involving some £1,796,000,000, and providing for a surplus of £15,000,000, has, on the whole, met with universal approval. I should like to congratulate Senator Lillico on his contribution to the debate last evening. His speech was certainly very logical and the result of clear thinking on his part. It did much credit not only to the speaker himself but also to this chamber.

When speaking on the Budget last year, I said that it is to be expected that in a young, reasonably prosperous country, which is developing to the extent that Australia is, we must expect some inflation. Try as we might, we are not going to prevent inflation in a short period of time unless we are prepared to adopt very drastic measures. The measures proposed in this Budget will have a steadying influence on the current inflation. Although they will not halt inflation, they will at least have a steadying effect on its rate of increase.

I am somewhat disappointed that more positive action is not being taken with respect to certain matters. I refer at the outset to pay-roll tax. I know that many Government supporters will say that were we to reduce or abolish the pay-roll tax, the benefit of such action would not be passed on to the consumers. Even admitting that that might be so, one cannot escape the fact that any reduction, or the complete abolition of the pay-roll tax,would affect costs. The Government has not tackled this problem as well as it might; but it must be tackled effectively if wc are to prevent the primary producers and people on fixed incomes from sinking deeper into a morass. I am not suggesting that payroll tax be abolished overnight. I realize that it provides a source of monthly revenue and that were we to abolish it and replace it by some other tax, it would be difficult to devise a tax that would bring in revenue on a monthly basis. If we were to impose a tax on an annual basis a longer time would elapse between the imposition of the tax and the time of collection. However, I feel that had we been prepared to budget for a surplus of, say, £5,000,000 and allocate £10,000,000 - the difference between that surplus and the anticipated surplus of £15,000,000 - towards a reduction of the pay-roll tax, greater benefit would accrue to our economy. Many people who have greater financial and economic knowledge than I have will say that that is not the course to adopt. I disagree. The reduction or abolition of pay-roll tax would be of very real benefit. I point out, incidentally, that during the last twelve months the sum of £3,000,000 has been paid in pay-roll tax by our State railways systems. That adds to the costs of those systems. We know that local governments also find pay-roll tax a heavy burden.

Another tax that affects us adversely is sales tax on landed costs. I am not suggesting that we do away with sales tax. I do not like it any more than I like a lot of other taxes. However, sales tax on landed costs is a burden that has to be borne by country people, and by country people I mean primary producers and workers employed in stores and other establishments in country areas. They are penalized because sales tax on freight adds to the landed cost of goods. The people in these areas have to bear a burden which is not felt to the same extent by other members of the community.

T turn to a discussion of the operations of the Tariff Board. We know that all the interests concerned have the right to appear before the board and state their case. As I stated in this chamber last week, I think that in some instances industries have only themselves to blame if their cases are not upheld, because of either insufficient or inefficient representation before the board. In some instances, representatives act for several industries which have not identical interests. Let me give an instance of what happens. Only last week, I heard of a case involving the supply of a tractor head to people in the central west of New South Wales. By some mischance. I suppose it might be called, the invoice went out with the tractor head. The client was able to see that the tractor head had been landed for £25, whereas the price he was asked to pay was £55. In the same context, I mentioned here last week the circumstances surrounding the importation of insulators from Japan which could be sold, after duty at the rate of 50 per cent, had been paid, for £36 per 1,000, whereas the Australian article was being sold at £67 per 1,000.

Room heaters can be manufactured in the United Kingdom for £6 1 ls. 3d., while the cost of a similar Australian heater is £15 19s. 3d. The cost of freight on the United Kingdom heater, plus 12i per cent, duty and allowance for wholesale and retail mark-up, would result in a price of £12 2s. 3d. I also cite the instance of men’s shoes which cost £3 a pair overseas. To that amount must be added duty which brings the cost to £4 16s. 6d. a pair. If we allow only 30 per cent, mark-up, the selling price is £5 14s. 6d., or almost double the landed cost.

I am of the opinion that our manufacturing industries must consider such things carefully. They have been sheltered by our import prohibitions and I am afraid that many of them have “ had it good “ for so long that they regard that state of affairs as something to which they are fully entitled. I do not say that we should not afford protection or impose duties. I think we all agree that that is necessary to allow our industries to become established. We have seen the development of the Holden motor car industry, and we know what a tremendous benefit that industry has been to Australia. In the early stages it received assistance by way of protection, although not to a great degree. I think that industries which enjoyed protection should make an effort to reduce their costs so that the price of the commodities they produce will be closer to that of similar goods imported from other countries. I have not sufficient time to deal with all the industries that come to mind. I shall content myself with saying that our manufacturing industries have not given sufficient attention to the need to reduce costs as much as possible, nor have they worried unduly about rising costs. They are in the happy position that, despite increased costs for the commodities they produce, they may immediately pass the increases on to the consumer. In the state of prosperity that we have been enjoying, the consumer has had to pay the increased prices, although admittedly he may have grumbled about doing so.

One of the propositions put forward by the Australian Country Party is that a bureau should be established for the purpose of assisting the Commonwealth Conciliation and Arbitration Commission. It is thought that if there were such a bureau it could provide information for the arbitration judges which would enable them to consider the effect that increases of wages which they were asked to grant would have. Only a couple of years ago, we had the extraordinary spectacle of one of our arbitration judges prophesying the price of wool in twelve months time. I do not think that that is the role of a judge or of any one else in the community. It is ridiculous to attempt to do that. In that case, the judge’s forecast probably influenced the judgment that he subsequently made.

Primary producers, in common with other members of the community who are selfemployed, have not the advantage of a 40- hour week or, as is commonly worked, a 45- hour week. They have not the benefit of three weeks recreation leave a year or long service leave. They must pay for their own insurance, and if there is overtime to be done they must do it without the benefit of penalty rates. When we speak of the hard conditions under which some workers operate to-day, we should remember the conditions under which primary producers carry on. I believe that, generally speaking, the Australian people have never been better off. I do not begrudge anybody good working conditions. The fact that conditions are good and that there is prosperity is comforting, but I agree with Senator Lillico that a lot of benefit could accrue to the economy if people did more for the money they receive. Until both young and old do so, we shall have to face many of the difficulties that are before us to-day.

Figures have been given in the Senate which indicate that returns to primary producers have declined. It is customary to sniff at such figures and to say, “ The primary producers are doing all right. Look what they got for their wool three or four years ago “, as if the wool-growers had then acquired sufficient fat to last them for the rest of their lives. It is obvious to those who understand the position that much of the increased income that wool-growers received when wool prices were high was ploughed back into the properties to catch up with maintenance that had been neglected for so long and to purchase materials that could not be procured until the war had been over for a considerable time. There had been no opportunity to accumulate liquid assets. That is one of the reasons why, to-day, when the barometer is definitely unfavorable for wool-growers, they have not the reserves of cash that they would have had but for the factors 1 have mentioned. I do not think there is any doubt that there has been a deterioration during the last six or nine months in the position of primary producers. It was disappointing that the wool market should have opened with prices at such low levels. It is true that on Monday and Tuesday last prices improved slightly. 1 am rash enough to say that if wool prices do not rise considerably, the economy of the country will be in a very bad way before twelve months have passed.

Last Saturday I heard of a primary producer who had decided to dispense with the services of one of his employees and to reduce the number of breeding ewes because his returns had diminished so greatly. After he had taken that action he found that his returns increased. That kind of thing is not in the interests of the community. In that instance, production was reduced and a man who might have been gainfully employed was sacked. It has been suggested that we have to look to the primary industries if we are to expand the value of our exports by £250,000,000, which is the target. I have no hesitation in saying that unless prices for primary products increase considerably we shall have not the ghost of a chance of achieving that aim.

Sitting suspended from 5.45 to 8 p.m.

Senator MCKELLAR:

– When the sitting was suspended I was saying that, unless there was a considerable increase in prices for primary products, there was very little hope of our primary industries being able to bridge the gap by raising the value of our exports by £250,000,000 a year. It is fitting that I should remind honorable senators of something they probably already know - that our primary industries are responsible for approximately 80 per cent, of our export credits overseas. To give the Senate an idea of the degree to which our secondary industries derive benefits from our export of primary products, I point out that they are using about 80 per cent of those export funds that are built up overseas.

Provision is made in the Budget for the transfer this year of approximately £7,000,000 from the equalization fund for payment to wheat-growers. There is a considerable amount of misunderstanding on the part of many people, about this matter. This fund has been built up over the years by contributions from the wheatgrowers themselves, and at the present time the amount in the fund is about £11,000,000. This year £7,000,000 is to be paid to the growers to recompense them for the loss incurred in selling wheat overseas at below the fixed cost of production. I warn honorable senators and members of the listening public that in the very near future we must expect the Government to contribute even larger sums for this purpose. F emphasize that the difference between the home consumption price and the price for which wheat has been sold overseas has cost the wheat-growers of Australia approximately £200,000.000 during the last ten or twelve years. So when in the near future the Government is called upon to make some contribution to the growers it would be wise of us to keep that fact in mind and not to think we are giving the growers a subsidy to which they are not entitled. In other words, we are only repaying some of the money that the wheat-grower has lent to the consumers of this country.

During this debate instances have been quoted of the disadvantages that accrue to the Commonwealth from the adoption of the uniform taxation system. Let me refer to one which relates to the wheat-growing industry. Only within the last few weeks there was a hue and cry on the part of some people in New South Wales who should know better to the effect that the Commonwealth Government is responsible for not making money available for extra wheat storage facilities which it is anticipated will be needed for this season’s crop. But I point out that the States are responsible for wheat storage. The appropriate State Ministers were reminded of that fact prior to the last meeting of the Australian Loan Council and they had plenty of opportunity to make provision in their claims to the Loan Council for this purpose. But not all the States availed themselves of the opportunity to make provision for the expenditure in their claims.

Now this position has arisen: In Western Australia the Co-operative Marketing Board within the last twelve months has spent approximately £5,000,000 on extra storage, but in New South Wales, where the hue and cry has arisen, the State Government has spent only £330,000. Now it is trying to flog the Commonwealth Government for not having provided funds for adequate wheat storage, and it is being aided and abetted by men who should know better. The responsibility for that state of affairs lies fairly and squarely on the New South Wales Government and not on the Commonwealth Government. That is one of the disadvantages that flow from the present system of uniform taxation. Although some of the States have protested about the operation of the uniform taxation system, they have not had the courage to come to the Commonwealth and say, “ We want our own taxing powers back”. In fact, when they have been offered their taxing powers back, they have not been able to slide out of the way quickly enough. I could give another illustration of the disadvantage of uniform taxation, but as my time is strictly limited I shall not do so just now.

The Opposition has made great play of the fact that the workers of Australia are not getting their fair share of prosperity. Only last week the Department of Labour and National Service published the results of ft survey of two-thirds of the main factories in Australia. The survey showed that one-third of the work force was averaging more thai seven hours’ overtime a week. That is a fairly good indication of the fact that there is not too much unemployment. We know that in New South Wales there are more jobs available than there are applicants for jobs. So the Opposition’s claim that the worker is not getting his share of the prosperity cannot be substantiated. It has been fairly reliably estimated that payments over and above the award wage to workers in our factories and industrial undertakings are costing approximately £3,000,000 a week. That is a good indication that our factories, too, are doing well. It is something that managements might take into consideration when they ask the Tariff Board for higher duties.

The rate of company tax is to be increased by 6d. in the £1. I think that increase was a source of amazement to many of the companies, because they expected it would be greater. When we consider the profits the companies have been able to make over the last twelve months, I am sure all will agree that the increase will not hurt any of them. I believe they can well afford to pay it as part of their share in the development of Australia. 1 believe that the Government could have achieved an even greater saving of expenditure this year. We know that the sum to be spent on development and works is lower than that allocated last year, but in my opinion the Government could have reduced the allocation even more. For example, we could have reduced the work that has been undertaken here in Canberra. I do not want the Senate to think for one moment that I am opposed to the spending of money on Canberra. After all, it is the Australian National Capital and is still in the process of being developed, and we want to make it a city of which Australia can be proud. There has been criticism of the expenditure of money on the lakes scheme. Although I do not agree with that criticism, I do feel that if the Government had been wiser it would have cut down the rate of expenditure. Perhaps it has done so - I have not seen the relevant figures - but I repeat that I believe it should be reduced.

The Opposition has told the Government that it should control hire-purchase activities. Honorable senators opposite know, Of course, that we have not the power to do that. They know very wen that the

States have that power but that they have not chosen to exercise it. The income that may be earned by aged persons before they become obliged to pay income tax is to be raised to £442. That is a provision that we welcome heartily. Pensions are to be increased to £5 a week.

The Opposition has said that the increase to be granted is only paltry. If we capitalized that amount, it would represent a capital of £5,200. A person would need to invest £5,200 at 5 per cent, in order to receive an income of £5 a week. Let us look at it in another way. If a person saved £2 10s. a week - I venture to suggest that not many people with average incomes would be able to save more than that - it would take him 40 years to amass £5,200. Yet the Opposition says that the pension k not enough, or that it is niggardly. .A worker who chooses to go through life spending every bob he get knows that he will be able to receive an age pension equal to the income that would be received by a person who had striven and, by self-sacrifice, saved £5,200. If the matter is looked at in that light, it is seen that the sum of £5 a week is not so niggardly as the Opposition tries to make out. The Government has been very wise indeed in giving some encouragement and incentive to people to save a little nest egg. Hitherto age pensions had ceased to be payable with the possession of property of a much lower value than the £4,200 which will be allowed in future.

We are all delighted that free medical services are now to be available to all service pensioners. Some of us feel that this provision does not go far enough and that all burnt-out diggers, as we call them, irrespective of whether they receive pensions, should be eligible for free medical services. I hope that next year the Government will see its way clear to extend that provision.

Our social services are so extensive and are costing the community so much - they must inevitably increase with_ the increase in our population generally and in the number of persons in need of these services - that we must have a very close look at some form of contributory scheme of a supplementary nature. I have been told that this has been tried in other countries but has not worked. However, Australia is the first country to produce a health scheme that is worthwhile. Let us remember the success of our anti-tuberculosis campaign. I do not know how we will get on, unless we consider a supplementary contributory scheme for social services.

We have had a lot of criticism of the medical benefits scheme. I remind honorable senators and those who are listening to the broadcast of our proceedings that 72 per cent., or 7,317,000 of the Australian population are in medical benefit funds, and that 74 per cent, or 7,546,000, are covered by hospital insurance. Therefore, we can see how people are benefiting very substantially from these two. important schemes, which were introduced by the Menzies Government.

There has been a lot of criticism about the additional medical benefits that were decided upon only a few months ago. The enlarged scheme is still only in the stage of infancy and many of the alleged disadvantages will iron themselves out. As from to-morrow, 1st September, another 100 drugs will be on the free list. I say to those doctors who criticize the scheme that the cause of much of the trouble about which they complain lies at their own door. The Minister for Health (Dr. Donald Cameron) has said over and over again that the panel that advises him, whose recommendations he invariably adopts, includes doctors who are members of the British Medical Association. If the advice that the Minister is getting is not the eight advice and the scheme is not working satisfactorily, I suggest to the medical men that the representatives of the B.M.A. be changed and that men who can give advice more to their liking be appointed to the panel.

I make one final point. We hear the Opposition from time to time talk about the deterioration in the value of the £1. When a company pays a dividend of £1 on a share, a great hue and cry is raised about it, but when there is an increase of 20s. .in wages, we are promptly told that it is worth only 5s or 6s. I am sorry that my time has expired. I conclude, as I began, by supporting the motion for the printing of the papers.

Senator McMANUS:
Victoria

.- The Budget which we are discussing is unimpressive. It reminds me of the American negro who was asked what he thought of prohibition and who replied, “Boss prohibition is not much good, but it is better than not being able to get a drink at all “. I do not think that even supporters of the Government are very happy about this Budget. In many instances, they have damned it with faint praise. Many of them have used their time to criticize portions of it, and obviously it has disappointed them.

The Budget is unimpressive because it lacks features. It is colourless. I suppose that if, you took out of it the slight increases in social service and repatriation benefits, you could almost say that the Treasurer (Mr. Harold Holt) could have said, “We are just going to do the same as we did last year “. This Budget was presented by a Government that has been in office for ten years, with flourishing revenues and with opportunities in many spheres for advancing this great country. What is there in the Budget that is inspirational? If the Government were to be defeated next year, to what could it point as some great enterprise that it bad initiated, like, for example, the immigration plan and the Snowy Mountains scheme which were initiated by the previous government? I asked last year what the Government could point to as an outstanding enterprise in its ten years in office. I was told that it could point to the elimination of the break of gauge - the building of 190 miles of railway. Surely we should ask for something better than this Budget from a Government that has been in office for so long a period under such ideal conditions. It seems to me that the Government needs more constructive and inspirational thinking, and I believe that its own supporters would welcome something of that kind from the Cabinet.

I am not going to deal to-night with the millions of pounds that have been so glibly mentioned in relation to certain activities. I shall not talk about the possibilities of inflation and the need to damp down here or damp down there. There seems to be plenty of dampness about the Budget. If the Government wished to curb inflation, I would have liked it to say, “ We will curb inflation here. We will channel investment from that unworthy end into this very desirable end.” I would have looked for something inspirational, something to lift this great country of ours. What have we go;? We have got a wet blanket. I believe, therefore, that the Government could have done a much better job. I know that many of its supporters in the Senate and in another place feel that it could have done a better job. However, with that sense of loyalty that characterizes them, they have decided to make the best of the Budget and pretend that they are pleased with it.

Senator Kendall:

– Wait until next year!

Senator McMANUS:

– I do not think that the Government is very afraid pf the Outcome next year. 1 imagine that the Government has looked at the present unfortunate political situation and has decided that there does not appear to be any prospect of it being remedied. The Government must feel confident that it will remain in office after the next election. It seems that some leaders of the Opposition have already conceded that, unless Providence intervenes. In those circumstances we can expect a Budget of this kind from a Government that is satisfied that it does not need to show particular enterprise. We are in a country where we need enterprise. We should be telling the people that a great job has yet to be done. We should he telling them that if they get out and do it, we will back them. We should not be telling the people that they are developing the country too fast, that they doing too well and that they should slow down for a while.

I want to look at the Budget as it affects the unsung heroes of the community - the family man and his wife. I do not think that, in this respect, the Budget could have done a worse job. I do not think that our vaunted economy is much good to the family man and his wife. Let us see what happens when a young couple wish to get married. We are told that ours is a flourishing economy. The young couple may wish to buy a block of land, but if they choose a block that is reasonably well serviced they will hang around their necks a load of debt for the rest of their lives. That is called justifiable and desirable expansion - when the price of land is inflated to such an extent that it threatens family life. When the young couple get married they are faced with such a heavy burden of debt that both of them must go to work. Both having to go to work, they postpone having children. When the wife is working because of the huge interest payments on their land and home, stresses and strains appear that do not appear in the family where the wife remains in the home and has her children around her. There you have the first threat to family life.

The price of land has been inflated, particularly in the areas around our big cities, to an extent that should never have been permitted. Having obtained a block of land and built a home on it, the young couple must then furnish the home. Immediately they go to the hire-purchase companies. They then take on another burden of debt that must be paid somehow. In many cases the husband is able to pay only because he works long hours of overtime. What will happen if an industrial depression occurs and overtime is cut out? The husband will not be able to meet his hire-purchase commitments, and the threat of a depression looms to-day over every family in the community. If the price of wool and other primary products were to drop, and if overtime were to cut out, how many young families in the community would be unable to pay their way? Overtime is the motivating force behind the application of some trade unions for a reduction of Working hours to 35 a week. Some officials in the unions may be sincere in pressing the demand, but the majority of workers in industry back the demand for a 35-hour week solely because they think that if hours were reduced to 35 more overtime would be available and they would receive more pay.

To-day, many young people are forced to enter upon family life under the everpresent threat of depression. I know that a depression has been predicted but has not happened. When I see the huge buildings that are being erected in Melbourne to-day and compare them with the equally huge buildings that were erected in 1890, bearing in mind the comparative price of land, all I can do is hope that we do not have another crash, which would involve so many young people in disaster.

Senator Branson:

– How can the Commonwealth control that?

Senator McMANUS:

– The Commonwealth has very wide powers, and it could do a lot to control speculation, some of which is getting out of hand. When the young couple have children they are often faced with serious difficulties in providing for them. Some people have said that the relative freedom from strikes that we have enjoyed in recent years may be ascribed to the fact that in many homes instalments on the house and on the furniture must be met and the husband is afraid to go on strike. That may be so for a time, but if ever the worker cannot meet his payments, and the strain becomes so great that he feels that matters are getting beyond him, he will soon be in the mood for industrial trouble. That is when you are likely to have strikes.

I am disappointed that the Government did not do anything to help the family man by increasing child endowment. Whenever the subject of child endowment is raised honorable senators opposite say that the Government which they support provided child endowment for the first child. That was a long time ago, and surely the Government does not propose to rest on its laurels for the remainder of its career. The Government has ignored child endowment consistently since it provided endowment for the first child as an election bribe - let us be candid - and we are entitled to ask whether it believes in child endowment. Does it say that child endowment should bear a proper relation to the cost of rearing a child? Why is the Government prepared to spend large sums of money in bringing immigrants to this country but will not give more assistance to Australian-born children? In asking that question I stress that I strongly support bringing every possible qualified person to Australia in order to help in our development. What is the Government’s attitude in respect of child endowment? It has done nothing to increase child endowment, despite the increase in the cost of living. We in this Parliament have increased our salaries and allowances. We have said that they must be increased in order to compensate for the rise in the cost of living. But whilst we say that when we come to Canberra we should receive £4 a day sustenance allowance, we still think that Ss. a week is sufficient for the first child. Where does the Government stand on child endowment? Does it believe in it or not? Does it believe that wages should be supplemented in some other way? What is its attitude to the family? We are not told the answer to those questions, but we are entitled to ask them.

I now come to the subject of taxation. Some objection was raised to Senator Cole’s remarks that direct taxes should be increased and indirect taxes should be reduced. I strongly support his attitude. Direct taxation is levied on the basis of income, but under many forms of indirect taxation the poor man pays as much as the rich man pays. That is inequitable and it should not happen. I am just as strong a supporter of direct taxation on income as is Senator Cole, because people pay direct taxes according to their ability to pay.

should like to see pay-roll tax abolished. It is a grossly inflationary tax which causes inflation out of all proportion to the revenue it yields to the Government. If this Government were a constructive government it would have abolished payroll tax years ago. Sales tax is a form of taxation which harms the family man. Therefore, it should be reduced. The Government should rely upon direct taxation because by that method the revenue is taken from those who can afford to pay it rather than from those who cannot.

I am astounded at the lack of action by the Government in regard to social services. Year after year we continue with the old system of deputations from the pensioners coming to Canberra a couple of months before the Budget is presented, and then deputations coming on the day the Budget is introduced. Sometimes they receive an increase of a few miserable shillings and sometimes they do not. That system seems to me to be unworthy of a great Commonwealth such as ours. Surely it should be possible for this Government, on a shortterm basis, to appoint an independent commission to determine social services and take them out of politics. Having appointed that commission as a short-term body, surely this Government should be able to set in operation a scheme of national insurance on a contributory basis. Such a scheme would take pensions out of politics. It would give people the pension as of right and it would enable the obnoxious means test to be abolished. Any government that did those things would deserve well of the country; but all we are told is, “ You could not do it “. Of course, you could do it.

Frequently I speak to new Australians who have come to Australia from countries which are known as progressive countries in Europe. They tell me that they are astounded that a country such as Australia, which is reputed to be progressive, has not yet been able to set up an adequate system of national insurance. I say, therefore, that the Government is falling down on the job when it does nothing in that regard. I believe maternity allowances bear no real relation to the cost of bringing a child into the world. To-day, when people have children they are involved in very considerable expense. Surely this Government ought to be able to look at this matter and say, “ We want population. Surely, we can increase these allowances and give some encouragement to the family people who are the backbone of this country.” Therefore, I say there are many things of a constructive nature which could have been done in this Budget to help the family man. It is with deep regret that I say the Government has let the family man down. It ‘has concentrated upon things that may appear to be important, but none of them is as important as the maintenance of good family life in this country.

I now come to the subject of education. Discussions on education seem to be causing embarrassment in some circles at the present time. I do not know why. Recently I spoke to a prominent educationist from Denmark and she told me that she was amazed at the embarrassed attitude people in Australia seemed to have towards education matters, particularly the relationship between private schools and Government controlled schools. I believe this is an issue on which we should be able to talk sensibly and without rancour, heat and religious differences. I propose to so discuss it. To-day there is a great and growing demand in the community for Commonwealth aid for education. We all know that the Commonwealth Government says, “ It is a State matter. We give the States funds. What they do with their funds is their business. Therefore it is none of our business.” I say emphatically that it is tha Commonwealth’s business and has been since the Commonwealth began to operate the system of uniform taxation and hold the purse strings.

All over Australia teachers’ organizations and other bodies are demanding Commonwealth aid for education. I see many of their members, because I am an ex-teacher and I am interested in education. They leave no doubt in my mind that right throughout Australia they are going to make education generally one of the big issues at the 1961 federal election. The government teachers’ unions, parents’ associations and other bodies in each State are organizing on a scale that has never before been seen in this country. They propose to contact all parents and urge them to vote for candidates who will support Commonwealth aid for education and against those who will not. Whether the present Government likes it or not, it will have to say what it intends to do.

I believe the people who are organizing this campaign are making a serious tactical error because, as far as I can ascertain, their object is that whatever money is made available shall be made available through the Commonwealth to government-controlled schools only. Let us look at the position from a commonsense point of view. Between 25 per cent, and 30 per cent, of the children in the community attend private schools. The amount of money that is mentioned by those organizing the campaign for Commonwealth aid for all education is £100,000,000 as a first instalment. Their suggestion is that between £25,000,000 and £30,000,000 of that £100,000,000 will be provided by parents whose children attend private schools, and those parents will receive nothing in return. I ask whether they consider it feasible that parents of children attending- private schools will be prepared to contribute between £25,000,000 and £30,000,000 of the initial £100,000,000 and receive nothing in return.

But it goes further than that. If these large sums are to be spent on improving the State education systems - and I support all measures to improve education - it must be remembered that the private schools are permitted to exist only on the condition that they maintain standards equal to those of the government-controlled schools. Therefore, if this campaign is successful the parents of children attending private schools will not only be contributing a quarter or more of this large sum of money but also putting their hands into their pockets to pay much higher fees in order to raise the standards of the private schools which their children attend to the higher standards then maintained by the government schools.

Last year the Melbourne “ Age “ had this to say -

Non-Government schools are fighting hard to survive in Australia, but the battle is growing harder. The likelihood that many schools will raise fees next year . . . indicates how matters are shaping. While it would be reckless to predict that, within a given time, non-Government schools will disappear, like private railway companies before them, their ultimate extinction seems certain.

Of course, that means that if you support this system, in theory you say you stand by the Declaration of Human Rights of the United Nations, which says that parents have the right to decide the form of education their children will receive, but in practice you force the private schools out of existence. You concede nominal freedom to private schools, but in practice you destroy them, in the same way as the Communists destroyed private businesses when they took over Shanghai ten years ago. They did not say that they would seize the huge businesses in Shanghai. Through taxation, they made the cost of running those businesses so high that before long the owners of the businesses owed the government so much money that they handed over the buildings and businesses in payment of what they owed.

The situation, therefore, is simply this: A decision will have to be made as to where this Government, the people of the nation, the Opposition and every party stands on this issue. I want to make it clear that I believe that when a parent contributes to taxation, that parent’s child is entitled to get something back from it. That is not a view that is held only by a few people. A gallup poll was taken in this country some years ago, and over 60 per cent, of the people interviewed declared that they were in favour of giving assistance to private schools. I believe that the amount of opposition to what I feel is only elementary justice is much exaggerated. If you go to Scotland, England, Southern Ireland or Ulster, you will find that private schools receive assistance there. You will find that that is the position in other countries of the Commonwealth, with one or two exceptions, including New Zealand. I believe, therefore, that this is a matter that we in Australia should have a look at. It is not a matter that we should be embarrassed about; it is not something about which we should say, “ This is a sticky one: let us put it to one side”. It is a matter that should be discussed on a commonsense basis, on the basis of what is right or wrong, not on the basis of whether or not we like private schools.

I am glad that this Government made a very small move in the matter some years ago, when it decided to waive the interest on loans made to private schools in this city. I think that the Government made a very good bargain there. But for that move, it would have been involved in the expenditure of immense sums of money, from which it has been saved by the sacrifice of people who believe in a principle as applied to education. I think that was a good move, but I regret the pettifogging decision that was recently made to charge these schools for the water consumed by them. When you consider the millions of pounds involved in the Budget, it seems to me to be rather a miserable thing to say that they shall be charged for the water used by them.

I hope that a lot of consideration will be given to this question. I am a believer in education. I do not think that it is altogether a question of money. Some people act as though all you have to do in order to make our educational system right is to spend a lot of money on it. Before you can improve the educational system, you must get the qualified teachers, professors and lecturers. We have not got them to-day. It is idle to talk about putting up magnificent buildings when we have not the first essential - the qualified teachers needed to do the job of teaching in those buildings. If we look at any capital city newspaper we must be amazed at the large number of advertised vacancies for qualified lecturers in the existing universities. If they cannot get staff, what hope would there be if we were to establish a large number of new universities? I think there is a very big job to be done in education, and we should all pull our weight in the campaign. The Commonwealth ought to contribute more money for education, but I believe that, in the interests of justice, the money should be contributed for all forms of education.

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

– The Government’s broad aim has been to promote, as a long-term objective, the development of full employment in this country without a loss of stability in the economy. This Budget, Sir, is directed to the task of maintaining growth and prosperity, whilst curtailing inflationary tendencies.

– I represent a small State, and 1 will protect the interests of the small State of Tasmania against concentrated power at Canberra so long as that threat affects Tasmania.

Senator Lillico referred to this subject last night in his very able speech. He told us that when this power was sought, as a temporary measure, by the Labour Government in office at the time, Dr. Evatt went to Tasmania. The Tasmanian Government had introduced a bill to give this power to the Federal Government. The bill reached the Legislative Council and one member, said Senator Lillico, rose and said -

This measure seems to me to be so farreaching and the implications of it are so wide and deep that 1 think we should have more time to study it.

I can give a very sound reason why the Government does not propose to do anything about inflation this year or next year. To do something would entail introducing a measure of austerity, and nobody wishes to live more austerely than he is living at present. The Government, knowing that next year is an election year, wishes to stay its hand so that it will not incur the wrath of its own supporters. It is not very solicitous of the wage and salary earners, the small businessmen, or the farmers in the community. It has included in the Budget provisions of a most partisan nature. We admit that the greatest problem facing the Commonwealth is inflation. When we analyse the Government’s intentions in regard to inflation, we may liken the Government to a fish, especially to a sole, because everybody knows that a sole has no entrails.

The Government claims to have done four things to strengthen the economy. It was represented at the last basic wage hearing before the Commonwealth Conciliation and Arbitration Commission. Not only was it represented, but it also canvassed the State governments to send representatives to the hearing and put the case of those governments to the commission. When the Treasurer was delivering his Budget speech only a week ago, and he came to the point of saying what the Government had done in that regard, he paused so that his supporters could, figuratively speaking, pat him on the back. Just imagine the Treasurer of the Commonwealth boasting that his Government had appeared before the commission to prevent the commission from granting an increase in the basic wage!

Everybody in the community was well aware that there had been an increase in the cost of living since the previous basic wage hearing. The Commonwealth’s C series index had registered such an increase, and it was well known to the Government and to every public authority in the Commonwealth that there had been such an increase.

The Government put its case to the commission, which gave a decision in its favour. The Treasurer then came along and claimed in his Budget speech that this was a remarkably good feat on the part of the Government.

I recall that this Government took action in 1953 to suspend quarterly cost of living adjustments based on the C series index. I propose to say something about the history of the system, to indicate what the Government will do to further its own interests and those of its supporters. It is a purely partisan government, having no regard for the family unit, the common good or the general welfare. In October, 1919, the then Prime Minister of the Commonwealth, William Morris Hughes, in the course of the policy speech he delivered at Bendigo, said -

The cause of much of the industrial unrest, which is like fuel to the fires of Communism and direct action, arises with the real wage of the worker - that is to say, the things he can buy with the money he receives. This real wage decreases with an increase in the cost of living. Now once it is admitted that it is in the interests of the community that such a wage should be paid as will enable a man to marry and bring up children in decent, wholesome surroundings - and that point has been settled long ago - it seems obvious that we must devise better machinery for ensuring the payment of such a wage than at present exists. Means must be found which will ensure that the minimum wage shall be adjusted automatically with the cost of living, so that within the limits of the minimum wage at least the £1 shall always purchase the same amount of the necessaries of life.

He was returned to office at the following election and the establishment of the C series index followed. It operated throughout the Commonwealth until 1953, when this Government decided that this index should not be heeded any further in the adjustment of Commonwealth awards.

– The Government fixed child endowment for the first child at 5s. a week when the basic wage was £6 9s. a week. Now we are getting the truth. The basic wage has since increased to £13 13s. a week, but child endowment for the first child remains at 5s. a week. Again I say that the Government is a partisan government. For the second and subsequent children endowment of 10s. a week was fixed back in 1941. There has been no increase since. In 1941, the basic wage was £4 9s. a week. If 10s. was a satisfactory sum in 1941, surely the amount should be considerably more to-day. But the Government is satisfied to remain idle and do nothing.

I want to say something about the unemployment benefit because this is a matter with which I am vitally concerned. The benefit is fixed at £3 5s. a week. It has been £3 5s. a week since 1945, when the basic wage was £4 17s. a week. What does the Government propose to do about this benefit? It is no good the Government saying that we have no unemployment in this country, because there is an army of 44,000 unemployed in the Commonwealth to-day and that figure is sure to grow in the near future. Some Government supporters who have spoken about unemployment seem to have the impression that unemployment can be spread over the Commonwealth like veneer with a brush on a sheet of plywood. Unemployment does not occur like that. I can tell them where there are pockets of unemployment in Queensland at present and I know that the Government is not doing anything about the situation, nor does it propose to do anything. When I ask questions about the sad situation, I am told that the Government has made millions of pounds available to the Queensland Government, and that it has fulfilled its obligations.

I can tell the Government what it should do about unemployment, particularly in the town of Gladstone. My suggestion will provide worth-while employment for those who are unemployed there and will improve the economy of the country.

I refer to the last report furnished to this Parliament by the Commonwealth Scientific and Industrial Research Organization, which contains the following information on page 26: -

The tremendous productive potential of some tens of millions of acres of well-watered but comparatively undeveloped land in eastern Queensland below the Tropic is strikingly illustrated by the most recent figures from a large grazing trial. This experiment on native spear grass country near Gladstone has now been in progress for several years.

The report goes on to mention that 10,000,000 acres of that land are available to be developed for cattle-raising purposes. If the Government wished to take some statesmanlike action, it would immediately make sums of money available so that the unemployed workers in Gladstone could be employed at a reasonable rate of pay. At the present time, they are receiving the miserable amount of £3 Ss. a week in the form of unemployment benefit. And next week or the week after the supporters of the Government will be asking themselves, “ Why is communism spreading throughout the country? “ It must spread if the Government deliberately starves men, their wives and their families. Here is an opportunity for the Commonwealth Government to do something. It has millions of pounds at its disposal, and it is merely a matter of having sufficient energy to go ahead and do the job.

Senator Kendall:

– What work would they do? Perhaps they could start another Peak Downs.

Senator BENN:

– No, they could develop the country so that it could produce beef.

The next matter on which I wish to speak is the abolition of import licensing. Unfortunately, I have not the time to deal with the four points. Import licensing was abolished1 or reduced some time ago. This was not done to improve the economy of this country and, of course, it was not done to check inflation. It was done because the whole of the import licensing section of the Department of Trade had got itself into such a hopeless muddle that there was only one way to clear it up and that was to abolish import licensing, which the Government did. However, that has not cleared the matter up so far. So unsatisfactory were the methods adopted by the import licensing branch, and so many were the evils committed by it, that if the Labour Party is returned to office within ten years, one of the first things it will do will be to investigate thoroughly the whole of the work that was done by the import licensing branch. We will do that with the approval of the people of Australia. The abolition of import licensing will not check inflation. The Government wants as many goods as possible brought into Australia - goods manufactured overseas - so that the Australian workers will not be afforded the opportunity of being employed. The Government is deliberately trying to create unemployment, just as it did in 1952 when it had the slogan, “ Too much money chasing too few goods “. I charge the Government with the social offence of deliberately trying to create unemployment. It is a serious charge, but the Government knows it is true.

Senator Kendall:

– How silly can you bel

Senator BENN:

– When I look at you I do feel silly.

Senator Hannan:

– Why do you always impute such base motives to the Government?

Senator BENN:

– Because my charge is true. It is based on facts, and I follow those facts through. I have heard the honorable senator condemn the system of import licensing.

Senator Hannan:

– Yes, I have condemned it, but not for the same reasons as you condemn it.

Senator BENN:

– That is because you do not know all about it. You have not seen the people, who get the rake-off from import licences, up at Surfers’ Paradise on holidays. They did not engage in any trade at all; they lent their licences to people. Honorable senators opposite are aware of those facts, just as much as I am.

Senator DRAKE-BROCKMAN:
Western Australia

– Mr. Acting Deputy President, in opening this debate for the Opposition, the Leader of the Opposition (Senator McKenna) dealt at some considerable length with what he called the necessity for constitutional reform. He believes that if certain reforms were effected this Parliament would have power to deal with such matters as inflation and hire purchase. As other senators on this side of the chamber have answered him. I do not propose to go over those matters again. The Leader of the Opposition concluded his speech by saying that during his address he had dealt only with the overall position affecting the economy and that he would leave the individual items of the Budget to be dealt with by his colleagues who would follow him. 1 have listened to this debate, and I have heard Opposition speakers who have risen in their places; but up to this stage it is quite evident to me that the Labour Party still has no policy for the development of Australia. We have heard the same old catch-cries, criticisms and forecasts of doom that we heard in the past.

Senator Benn referred to unemployment. In Western Australia at the present time, we are very worried about where in the near future we are going to get enough tradesmen to carry out the proposed works which will be commenced very shortly. There is the work on the Ord River scheme; a large hotel will soon be erected in Perth; and there are many government works projects, such as office buildings and several big schools. The Government of Western Australia had to ask the Minister for Immigration (Mr. Downer) to increase the quota of tradesmen coming to Western

Australia. So, in that State at least, we are far from having any unemployment.

Judging from this debate, I am quite sure that members of the Labour Party are still living in the past. They still believe that by continually criticizing the Government and prophesying doom they can make the people think that disaster is just around the corner. However, I know, and I believe all of us know, that the Australian people realize that the last ten years have been a period of unparalleled prosperity for the whole nation. Wherever they look they see evidence of that. The ordinary working man has only to look at his increased standard of living and to consider the added comforts he has in his home and the higher standard of education that his children enjoy. He has only to look around him and see the many great buildings and factories that are being constructed everywhere. If he wants further proof, he has only to look at the tremendous development that has taken place on farming properties.

Senator Benn criticized the Country Party for alining itself with the Liberal Party in the government of this country. I would like to assure the honorable senator that the Country Party is proud to align itself with, and to be a part of, a Government which has done so much for us. Let us consider a few of the happenings in this country over the last ten years. This Government realized the necessity to increase our population as fast as it was economically possible to do so. Therefore, it adopted a progressive immigration policy which, during the period to which I have referred, has been responsible for a net increase of 1,000,000 in our population. By bringing immigrants to this country, we have increased our total population by 27 per cent., and to-day we have a population of 10,000,000 people.

This increase of population necessitated an increase of employment opportunities. Jobs had to be provided for the immigrants. The statistics show that- civilian employment, excluding rural employment, has risen by 20 per cent. To-day, there are nearly 500,000 more people employed in Australia than were employed before this Government came to office. As I have said, Sir, it was necessary to provide jobs for as many of our immigrants as possible.

The rural industries, because of the introduction of mechanization and new techniques, could not employ a huge influx of people. The only way in which the newcomers could be employed in big numbers was in the factories. Therefore, this Government encouraged the setting up of new industries and new factories. During our term of office, the number of factories in Australia has increased by 37 per cent., and factory output has increased by 72 per cent. It is noteworthy that the production of steel has increased from 1,000,000 tons a year to more than 3,000,000 tons a year.

Having brought immigrants here and found jobs for them, we then turned our attention to housing them. It is in this connexion that the Opposition has continually levelled criticism at the Government. If we look at the housing situation in Australia at the present time, I think We can feel justifiably proud. In my own State, the lag in housing has been overtaken. I am told that the rate of construction of houses and fiats in Australia is now 31,500 units a year greater than it was ten years ago. I believe that, since this Government has been in office, about 750,000 dwellings have been built, at a cost of almost £2,000,000,000. These are remarkable achievements, of which the Government can be proud, and I repeat, in answer to the criticism which was made by Senator Benn, that the Country Party is proud to aline itself with the Liberal Party in the Government of this country.

I would like to go a little further and prove to the Opposition that an even greater story can be told of the expansion and development of this country, particularly if we have a look at some of the new industries that have been established here in recent years. For instance, the capital value of the oil industry in Australia has increased from £3,000,000 to £105,000,000. I turn now to another hobby horse of the Opposition - the motor industry. The value of the production of this industry has increased from £8,000,000 to £60,000,000, and at the present time I believe the industry is turning out about 241,000 vehicles a year. I ask the Opposition: Who, in the main, buys these vehicles? The answer is, of course, that they are bought by ordinary office workers, electricians, carpenters, and other workers whom the Labour Party claims to represent.

I have been dealing, Sir, with the expansion and development of the secondary industries during the last ten years. In the same period, rural production in Australia has increased by about 37 per cent. Let us consider the amount of pasture development that has taken place, as evidenced by the area of pasture land that is fertilized each year. We find that the increase is something like 13,000,000 acres. The superphosphate works have increased their production to 700,000 tons a year.

There has been a remarkable expansion in this country, with a consequential improvement in our living standards. Our economy is now much stronger than when this Government came to office. Admittedly, much of the development and expansion to which I have referred has been achieved by the initiative and hard work of individuals, as well as by company investment, but I make the point that, despite hard work and investment, expansion cannot take place unless the economic climate and conditions are favorable. Accordingly, this Government undertook the task of establishing an economic climate and conditions appropriate to expansion. When it came to office, there existed a number of bottle-necks. I remember this condition particularly, because I had just started farming and I had to go from firm to firm lodging applications for a tractor. I had to wait for months before any firm would give me an indication when I would get one. This Government eliminated the bottle-necks that existed, particularly in the farming and transport industries, by negotiating a dollar loan from America.

Then, in order to help farmers maintain a high production rate and thus earn increased income overseas, the Government over the years has introduced many special taxation depreciation allowances. This, as I said earlier, has enabled farmers to re-equip their properties and generally to develop them. The Government, through the Minister for Trade (Mr. McEwen), has entered into trade agreements. A good example of this is the agreement with Japan which has increased enormously the sales of wool and wheat to that country. In fact, during the last season Japan was our best customer for wool, and this made a tremendous difference in the auction rooms. These things have given the primary producers a great incentive to increase their production.

However, not everything connected with national expansion can be put on the credit side as far as rural industry is concerned. I refer to costs and prices. Policies that have been implemented by this Government to foster national expansion and bring about prosperous internal conditions have had a tendency to increase the costs of the primary producer. A rapid expansion of factories has taken place within the framework of our tariff system. We realize, as I said earlier, that we must have factories to create employment for our vastly increased population and also to provide employment for increasing numbers of young people who are leaving school each year. The policies of full employment and increased social services have increased costs.

There has been also an increase in Government expenditure on public works. Honorable senators opposite have criticized this expenditure as being inadequate, but the point I make is that the increased expenditure has increased the cost of the primary producer. The primary producer, unlike those engaged in other sections of industry, is not in the position to pass on his costs as he depends on the price obtained overseas for his products. Far too many people in this country at the present time think that the primary producer is raising a great hue and cry about nothing. They suggest that because the producer’s wife has many of the latest appliances in her home, such as awashing machine, electric cooker and so on, and the farmer drives around in a late model car and works his farm with modern plant, things cannot be as bad as he makes out. But are not people in every section of the community living in modern homes equipped with modern conveniences? Are not those people able to take their families out each week-end in a late model car? Of course, they are. It is all part of the prosperity that all in this country are enjoying at the present time.

The farmer is dependent on overseas markets to sell his products, and he also has to pay a high price for the things he needs to enable him to produce. The result is that he makes a very small profit. It is only by making a profit that the farmer is enabled to develop his property and buy new equipment. If primary producers were able to overcome the cost problem they would have an incentive to produce.

Unfortunately the position frequently arises where the farmer is obliged to make old equipment do for another two or three years. And when the farmer cannot buy new equipment the manufacturer has to put men off and cut down his production rate. Then, when creditors press the primary producer he cuts down on other purchases, such as fertilizer, and this in turn seriously reduces his production. The result is that a vicious circle is created.

During the 1958-59 wool season the average price of wool was about 47d. per lb. That was brought about because of conditions in Western Australia at that time. Producers stopped buying wire netting and ordinary galvanized wire with the result that one company in that State found itself with excess stocks. So badly was it affected that in June of that year it had to write to the Broken Hill Proprietary Company Limited and ask it to cease supplying orders. However, the new wool season opened with wool selling at ls. per lb. higher and producers were then in a position to carry out much-needed improvements. There was a rush of orders for plain wire and wire netting with which suppliers were not able to cope. The result was that early this year a severe shortage of those products occurred in Western Australia. I give that illustration of the situation in which primary producers can find themselves as a result of not being able to make sufficient profit to give them the incentive to carry out developmental work. Primary products account for approximately 80 per cent, of our export earnings at present. I understand that the value of those products is more than sufficient to cover the cost of materials used by the secondary industries in manufacturing their products. It also helps to meet the interest on overseas loans. I ask: What can be done to step up production? With the lifting of import restrictions, an increase of production will be essential in order to increase our overseas balances.

Let us consider the position of primary industry. It is pertinent to ask ourselves which section of primary industry is most likely to assist in the overall increase of production. It seems to me that we shall not be able to increase greatly our sales of butter. As for wheat, the producing countries have large stocks on hand. It seems to me that the volume of wheat sales can be increased only by means of inter-governmental agreements. Therefore, I do not think that we can rely to a very great degree on increased sales of wheat to help our overseas balances.

I think there is terrific potential for increased production in the meat industry, and I believe that if we could find markets overseas we could increase sales of meat considerably. I believe that the wool industry is the only industry from which increased sales may be expected. It is estimated that this year the wool clip will be lighter than it was last year. At the opening sales this year, the price of wool fell by about 9d. per lb. The indications are that the value of the wool clip this year will be about £80,000,000 less than it was last year. I am of the opinion that we could increase considerably the value of our wool clip if we introduced a marketing scheme. At the moment, the two great organizations in the wool industry seem to be taking opposite views in this respect. The Government has stated that it cannot take any action to change the wool-selling system until the two organizations get together and decide whether or not they want to alter the system. The Government has said that if the organizations decide in favour of a change, and place their views before it, it will be willing to consider the matter.

It has been said that the two important organizations in the wool industry are poles apart on the question of adopting a wool marketing plan. I do not believe that they are. People outside the wool industry have said that they are at variance. For their own reasons, they want to keep the two great organizations apart. I have before me a plan prepared by one of the members of the graziers’ organization in Queensland which appears to embody, in principle, the proposals of the members of the Australian. Wool and Meat Producers Federation. I think that the graziers of Western Australia would be willing to consider favorably the plan suggested by the United Graziers’ Association. I see that my time has expired, so I am not able to deal with other matters that I had proposed to discuss.

Senator ARMSTRONG:
New South Wales

.- This Budget has been criticized, as previous Budgets of this

Government have been criticized, on the ground that it ignores the things that the ordinary people of the community think should be faced and dealt with. For instance, there are no proposals in the Budget to increase child endowment and maternity allowances, matters that affect family life. There is no proposal to reduce or abolish the pay-roll tax, although its abolition would, I think, be one of the most antiinflationary measures that could be taken. There is no proposal to increase depreciation allowances for industry, nor is it proposed to reduce sales tax. Instead, sales tax is to be increased - and we all know that sales tax is inflationary. So, without going into detail, I make that comment as my first criticism of the Budget. Fundamental things have been ignored.

– I do not know about that. Down the years, the most interesting thing about the Australian Country Party has been the extraordinary success it has had in obtaining what are so rudely called the plums of office. On looking round this chamber, and having regard to the numerical strength of the party, it is extraordinary to note the number of positions that are held by members of the Australian Country Party. It would seem that the members of the party are so busy feathering the nest in Canberra that many of the fundamental problems bf the man on the land are forgotten.

– No. You must grow up, even though you do not want to do so. This Government’s problem is that it is still thinking in the manner of the 1930’s, when different conditions applied to the Australian economy. Our problem was to start a new industry. We had had a war on our hands, and there was a great problem in transferring hundreds of thousands of men and women out of the armed services and munitions factories into peace-time industries without dislocation and without unemployment. The problem was solved in such a manner that even the ranks of Tuscany could scarce forbear to cheer. The task was accomplished without unemployment. That was why General Motors-Holden’s Limited was encouraged. However, in the light of the knowledge that we have now, surely the time has come to adopt a different attitude. Mr. Staniforth Ricketson said -

Could we not say, and bring continuously to the notice of overseas interests seeking a stake in this country, that we regarded 30 per cent, of the equity as the minimum which should be held by our own nationals?

Stable political and industrial conditions, availability of raw materials, a steadily growing labour force, well-developed marketing techniques and an increasing market had all contributed materially to the success of overseas organizations which had entered the Australian field.

Our criticism of General Motors-Holden’s Limited and other such organizations is based upon the fact that they are exporting so much of their profits, and placing on the Australian community a very heavy burden in having to make available the money necessary to pay dividends overseas. Who can deny the tremendous job that General Motors-Holden’s Limited has done for Australia? When people talk of monopolies, it is not that organization that comes to mind. After all, any one can build a motor car and many are trying to do so, but that organization is selling in fair competition at a price that the Australian public is prepared to pay. To me that is fair trade. The organization is doing a great national service and is entitled to its profits. I say only that such a tremendous burden should not be placed on the Australian community as a result of the dividends paid overseas.

In spite of what the Treasurer said, the country is not growing too fast for its own good. I have compared Australia’s imports and exports with those of other Western countries. An examination of those figures and the national incomes of those countries shows that Australia is not one of the fastest growing countries. I have examined the position of almost every country in Europe, decadent though we may say they are, with thousands of years of living too close to one another and of being so often at war. In the last ten years almost all of those European countries have been expanding at a faster rate than Australia. The “Yearbook of International Trade Statistics “ for 1958 shows that our growth has not been so fast as the Government would like the people to believe. In 1948, the value of our imports, expressed in American dollars, was 1,227,000,000 dollars; in 1958, the value had risen to 1,792,000,000 dollars. During the same period the value of imports into The Netherlands rose from 1,871,000,000 dollars to 3,624,000,000 dollars; the value of imports into France rose from 3,441,000,000 dollars to 5,604,000,000; Italy’s imports rose from 1,539,000,000 dollars to 3,169,000,000 dollars; and the value of Germany’s imports increased from 1,389,000,000 dollars to 7,360,000,000 dollars. In 1948, Australia exported goods to the value of 1,652,000,000 dollars. In 1958, the value was only 1,655,000,000 dollars - almost the same as the value in 1948, despite the severe depreciation of the currency. During the same period the value of exports from The Netherlands increased from 1,024,000,000 dollars to 3,217,000,000 dollars; the value of French exports rose from 2,011,000,000 dollars to 5,118,000,000 dollars; the value of Italy’s exports rose from 1,076,000,000 dollars to 2,536,000,000 dollars; and the value of Germany’s exports increased from 599,000,000 dollars to 8,807,000,000 dollars. Those figures show that Australia is lagging badly behind Western countries.

I have taken out some interesting figures comparing the national income of certain countries with that of Australia. In 1950, Australia’s national income was £3,083,000,000, and in 1958 it was £4,931,000,000. In 1950 Canada’s national income was about £14,000,000,000, and it had risen to £24,000,000,000 by 1958. The national income of France rose from £7,500,000,000 in 1950 to almost £18,000,000,000 in 1958. Italy’s national income rose from £6,800,000,000 in 1950 to £i 3,000,000,000 in 1958. In the United Kingdom national income rose from £10,688,000,000 in 1950 to £18,000,000,000 in 1958. All those countries maintained the value of their currency better than Australia. Australia’s cost-of-living index rose from 68 in 1950 to 115 in 1958. In Canada the index rose from 89 to 108, in France from 77 to 122, in Italy from 86 to 113, and in the United Kingdom from 81 to 119. In view of the depreciation in the value of our money we should have a higher national income and greater value in respect of imports and exports; but Australia does not measure up very well with other countries.

The Government does not seem to realize that although our growth is rapid it is not nearly as rapid as it should be if the Government set its mind to the tasks that confront it. The Government is parading like the famous Stuart king who thought that he ruled by Divine right but finally had his head chopped off. The Government must prove to the people that it is prepared to shoulder its responsibility in building Australia so that everybody in the community shall get a fair deal. When we compare the progress that has taken place in the countries I mentioned we see that the Government has not done all that it should have done and that a great deal remains to be done. The achievements of the past ten or eleven years are no monument to the Menzies Government.

Senator WRIGHT:
Tasmania

.- We have just listened to a speech that was typically partisan and, for that reason, I believe, of limited value. It is a very limited outlook that does not place emphasis on the need for continued immigration and expanded development in Australia to-day. In this under-populated country it would be a denial of our national duty to curtail immigration. We owe a good deal to the Minister for Immigration (Mr. Downer) for the energy with which he has implemented our present immigration policy. I hope that he will be able to obtain encouragement from Washington and London. The Governments of the United Kingdom and the United States of America should begin to take an interest in our immigration programme because it will be just as much in their interest in twenty years’ time to have this country strengthened and developed from a population point of view as it will be in ours. I am at a loss to understand why that facet of unity of interest between Englishspeaking peoples has not been more actively put into effect.

We in this country are entitled to feel proud of the development that has taken place here, but we would be deluding ourselves if we thought that our development was unique. Development is proceeding apace in other countries, and any decision to curtail development in Australia should be taken only after the most critical consideration. I shy without winkers at the phrase in the Budget that we must restrain demand. We are setting out to populate and build the country. We are not in any sense independent and can never hope to be independent in our time. We will continue to be dependent upon external markets. As some of my Country Party colleagues have so appropriately emphasized to-night, the primary factor in maintaining our development is surely maintenance of prosperity in our exporting industries.

I undertake to show that the export production of this country is approaching a crisis because of the damage being done to the Australian economy by industrial agencies. That is where the economy of this country is being undermined. The problem is not going to be solved by agriculturists joining in creating bureaus for the information of judges. That will be an aid, but we cannot pass on to those bodies the responsibility of solving the problem. That is the responsibility of this Parliament.

As my Australian Country Party colleagues have said more than once to-night, the agricultural community produces 80 per cent, of Australia’s export income. I shall give two figures showing the percentage of the national income which farm income represents. In 1949-50, farm income was £448,000,000, representing 19 per cent, of the national income. In 1959-60, farm income showed a miserable increment to £466,000,000, representing 9 per cent, of the national income. The following table sets out the complete series of figures and shows the trend from 1946-47 to 1959-60:-

If one looks at the figures which indicate how that diminishing proportion of the national income is being eroded by the internal cost structure in Australia, one will see that the all-products index for prices received in 1949-50 was 134 and to-day it is 179; and the all-products index for prices paid was 118 in 1949-50 and to-day it is 225. Taking the ratio of prices received to prices paid in the all-products index, in 1949-50 the figure was 114 and to-day it is 80.

Can that section of the community which produces 80 per cent. of Australia’s export income, and so provides the sinews for Australia’s secondary industries, including raw materials and plant, be expected to discharge that responsibility, handicapped by a system of wage fixation that is unique in the world - irresponsible, unreliable, a system that has proved destructive of this continent’s economy throughout the whole eleven years during which this Government has been in office? The first budget that was introduced by this Government was submarined by a basic wage increase of £1 a week the following month, and under the ridiculous system of statistical quarterly adjustments, which was allowed to run free and ungoverned for three years, costs increased and the Commonwealth Court of Conciliation and Arbitration was left to arrest the increase and say, “ We will unhinge the cost structure from the automatic statistical adjustments “. There was comparative equilibrium until further nonsense overtook Australia. Then last year, there was injected into the economy, through the Commonwealth Conciliation and Arbitration Commission, a cost of between £160,000,000 and £180,000,000, which by the time it reaches the debit accounts presented to the farming community will be £400,000,000. If the Government maintains that irresponsible agency in the circumstances of the economy of 1959-60, it will destroy the country’s export industries, which alone can sustain the imports that are vital to development and immigration.

If one turns to the table on page 16 of the White Paper submitted by the Treasurer, one sees this point illustrated. In 1953-54, wages and salaries aggregated £2,200,000,000. By 1959-60 they had increased by 50 per cent. to £3,300,000,000.

But farm incomes were £499,000,000 in 1953-54, and they had receded by £33,000,000 to £466,000,000 in 1959-60, the year in which wages and salaries had increased by £1,100,000,000, or 50 per cent.

Senator Ormonde:

– How are you going to change it?

Senator WRIGHT:

– By resolute government policy. I would not place the responsibility on the farming organizations, and I would not place it on the industrial unions; but, of course, there are some unions operating under the arbitration legislation which are causing increased costs. 1 instance the Seamen’s Union. To-morrow, at greater leisure, I shall give a catalogue of its industrial crimes. It has injected inexcusable costs into the shipping industry of this country. As far as I know, this Parliament has heard very few voices of protest and there has been no action. I believe it is the responsibility of those on this side of the chamber to look at the Australian wage fixing apparatus, which is unique in the world, and which is sacrificing this country by destroying the value of money. There is imposed on us a direct responsibility to overhaul the system before it destroys us and before it destroys the nation, which is more important.

In the White Paper there is the record of the last six years. While the incomes of wage-earners and those receiving salaries increased by 50 per cent. in the aggregate, farm incomes fell. Let me give one illustration. In the Public Service, over which we have complete control, and for which we have complete responsibility, a reduction of five people was effected last year in a total personnel of between 160,000 and 180,000.

Debate interrupted.

page 349

ADJOURNMENT

The DEPUTY PRESIDENT (Senator the

That the Senate do now adjourn.

Question resolved in the affirmative.

Senate adjourned at 11 p.m.

Cite as: Australia, Senate, Debates, 31 August 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19600831_senate_23_s18/>.

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Senate31 August 1960

QUESTION

PARLIAMENTARY ALLOWANCES

Senator O’FLAHERTY:SOUTH AUSTRALIA

Senator GORTON:Minister for the Navy · VICTORIA · LP

QUESTION

ELECTRIC POWER CELL

Senator BRANSON:WESTERN AUSTRALIA

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

QUESTION

BEEF

Senator McMANUS:VICTORIA

Senator GORTON:LP

QUESTION

PORT DALY AND ADELAIDE RIVER

Senator KENDALL:QUEENSLAND

Senator GORTON:LP

QUESTION

MOUNT ISA TO TOWNSVILLE RAILWAY

Senator DITTMER:QUEENSLAND

Senator SPOONER:LP

QUESTION

DRIED FRUITS

Senator PEARSON:SOUTH AUSTRALIA

Senator GORTON:LP

QUESTION

BALL POINT PENS

Senator SCOTT:WESTERN AUSTRALIA

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

QUESTION

PAPUA AND NEW GUINEA

Senator SHEEHAN:VICTORIA

Senator Sir WALTER COOPER:

QUESTION

ATOMIC ENERGY COMMISSION

Senator ANDERSON:NEW SOUTH WALES

Senator SPOONER:LP

QUESTION

CIVIL AVIATION

Senator O’BYRNE:TASMANIA

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

QUESTION

WHEAT

Senator MCKELLAR:NEW SOUTH WALES

Senator GORTON:LP

QUESTION

PARLIAMENTARY ALLOWANCES

Senator O’FLAHERTY:

Senator GORTON:LP

Senator O’FLAHERTY:

Senator GORTON:

QUESTION

REPATRIATION

Senator LAUGHT:SOUTH AUSTRALIA

Senator Sir WALTER COOPER:

QUESTION

CONSULAR SERVICE

Senator ARMSTRONG:NEW SOUTH WALES

Senator GORTON:LP

QUESTION

MINING

Senator SCOTT:

Senator SPOONER:LP

QUESTION

REPATRIATION GENERAL HOSPITAL, HEIDELBERG

Senator SANDFORD:VICTORIA

Senator Sir WALTER COOPER:

QUESTION

JAPANESE TOYS

Senator LAUGHT:

Senator HENTY:LP

QUESTION

INTERNATIONAL TRADE FAIR

Senator HANNAN:VICTORIA

Senator SPOONER:LP

QUESTION

SUPERANNUATION

Senator HENDRICKSON:VICTORIA

Senator PALTRIDGE:LP

LEAVE OF ABSENCE

Senate
31 August 1960

Senator O’FLAHERTY:
SOUTH AUSTRALIA

Senator GORTON:
Minister for the Navy · VICTORIA · LP

Senator BRANSON:
WESTERN AUSTRALIA

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

Senator McMANUS:
VICTORIA

Senator GORTON:
LP

Senator KENDALL:
QUEENSLAND

Senator GORTON:
LP

Senator DITTMER:
QUEENSLAND

Senator SPOONER:
LP

Senator PEARSON:
SOUTH AUSTRALIA

Senator GORTON:
LP

Senator SCOTT:
WESTERN AUSTRALIA

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

Senator SHEEHAN:
VICTORIA

Senator ANDERSON:
NEW SOUTH WALES

Senator SPOONER:
LP

Senator O’BYRNE:
TASMANIA

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

Senator MCKELLAR:
NEW SOUTH WALES

Senator GORTON:
LP

Senator GORTON:
LP

Senator LAUGHT:
SOUTH AUSTRALIA

Senator ARMSTRONG:
NEW SOUTH WALES

Senator GORTON:
LP

Senator SPOONER:
LP

Senator SANDFORD:
VICTORIA

Senator HENTY:
LP

Senator HANNAN:
VICTORIA

Senator SPOONER:
LP

Senator HENDRICKSON:
VICTORIA

Senator PALTRIDGE:
LP

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

Senator McKENNA:
Leader of the Opposition · Tasmania

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

Senator PEARSON:
South Australia

Senator HENDRICKSON:
Victoria

Senator McCALLUM:
New South Wales