23rd Parliament · 2nd Session
The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers.
– I ask the Leader of the Government in the Senate whether it is a fact that the short-lived Labour Government in New Zealand has been defeated and replaced by a Nationalist Government. Does the Minister believe that this needed change of government will l°ad to greater development and prosperity in New Zealand, will open the way for increased trade between that country and Australia and will ensure the maintenance of the very cordial relations which exist between the two countries?
– I always believe that the defeat of a Labour government is a good thing for the country concerned.
– My question is addressed to the Minister representing the Postmaster-General. Will the PostmasterGeneral be attending various parties from now until New Year’s Day? Will he be entertained at those parties by Australian singers and musicians? Does he expect that the standard of entertainment which will be provided will be superior to that provided by the majority of American films screened on television? Whenever the PostmasterGeneral hears a certain American singer attempting to sing “ O Sole Mio “, which was once sung with great success by Enrico Caruso, does he feel like reaching for his gun?
– Tt has been a longstanding practice in the Senate not to answer questions without notice relating to policy. T suggest that the manner in which the Postmaster-General employs his time between now and New Year’s Day, and what might be his personal tastes, are questions of high policy for the PostmasterGeneral himself.
– I ask the Minister representing the Minister for Trade the following question: - Owing to the fact that there has been a very welcome change of government in New Zealand, is he in a position to say whether the Minister for Trade will be visiting that country in the near future with a view to increasing our exports to that country?
– I am not aware of the movements of the Minister for Trade; I do not know whether he proposes to go to New Zealand. I am sure he will be very eager, indeed, to expand our trade connexions with New Zealand; and I expect that his efforts will be successful.
– Can the Minister for National Development inform the Senate of the possible effect on the coal-mining industry of the introduction of a 35-hour week? I understand that the Government of New South Wales is toying with the idea of introducing legislation fixing a 35- hour week, despite a recent decision of the Coal Industry Tribunal. Can the Minister also indicate the effect on the steel industry and other industries if the Parliament of New South Wales were to legislate in this way?
– I cannot say what the Government of New South Wales may have in contemplation. I do not know whether it proposes to introduce legislation for a 35-hour week in the coal-mining industry, or whether such legislation would be valid if it were passed. I refer Senator Laught, and other honorable senators who may be interested, to the judgment of Mr. Justice Gallagher on the application for a 35-hour week, in which he reviewed in detail the effect that a 35-hour week would have on local costs, particularly in relation to the steel industry, and also the possible effect on the export trade. I refer the honorable senator specifically to that part of the judgment in which His Honour stated that those effects constituted a convincing reason why the application should not be granted.
– My question is addressed to the Minister for Civil Aviation. Will the Minister confirm a newspaper report of last week to the effect that the Department of Civil Aviation was negotiating with the South Australian Housing
Trust for the exchange of certain land at West Beach aerodrome, near Adelaide, to assist the Department of Civil Aviation to find suitable land for use as an emergency or alternative port of call for jet aircraft, such as the Boeing 707? Is the land, which the Commonwealth proposes to offer by way of exchange, acceptable to the South Australian Housing Trust?
– As I recall this matter, the Department of the Interior, on behalf of my department, is negotiating an exchange in which land adjacent to the West Beach airport at Adelaide is involved. One of the purposes of the exchange is to overcome a drainage difficulty which arises from the construction of the boundary drains at the airport and the effect of that drainage on adjacent property. I cannot, with any degree of precision, give the honorable senator details of the area involved, although my recollection is that it is not great. So far as I know, the negotiations with the South Australian Housing Trust, which owns some of the land involved, are quite harmonious and are proceeding as expected.
– Is the Minister representing the Postmaster-General aware that delays are still occurring in the delivery of mail despatched by air from Western Australia? Can the Minister account for the fact that letters posted in Perth on Sunday, and bearing Sunday’s date stamp, are not received in Canberra until the following Wednesday?
– The only answer I can give the honorable senator is that I shall ask the Postmaster-General to make some inquiries regarding her complaint.
– My question, which is addressed to the Minister representing the Minister for Shipping and Transport, relates to the oft-repeated statement and popular belief that the break of gauge between Perth and Brisbane is responsible for a great deal of delay for train travellers. Is it not a fact that at the places where the break of gauge occurs between Perth and Brisbane, namely, Kalgoorlie, Port Pirie and
Albury, a total of only about one and a half hours is occupied in transferring passengers from one train to another? Is it not also a fact that at Adelaide, Melbourne and Sydney, where there is no break of gauge, passengers from Perth to Brisbane and other parts of the eastern States are kept in those capital cities for many hours, and are also forced to change trains? Is it not a fact that about 20 hours are actually wasted by passengers travelling between Perth and Brisbane, for the reasons I have stated, at the cities where there is no break of gauge? Will the Minister get in touch with the State railway authorities concerned in order to ensure that unnecessary delays in the capital cities are obviated for the benefit of the tourist trade and of passengers travelling from Western Australia to the eastern States?
– Generally speaking, I think it is true to say that at a break of gauge point, wherever it occurs - at Kalgoorlie, Port Pirie or Albury - the actual time taken in transferring passengers and luggage from one train to another is not very great. I think it is also true to say that sometimes - I am not prepared to say always - delays for operational reasons at certain other points are longer than those that occur at break of gauge points. I do not know whether the times cited by the honorable senator are correct. I shall be pleased to refer his question to my colleague, Mr. Opperman, and if the delays are of the extent mentioned by the honorable senator, I will certainly ask my colleague to have a look at the timetables.
– My question is directed to the Leader of the Government in the Senate. With the pretty picture of the economic systems of the United Kingdom, the United States of America and Australia experiencing a financial crisis as a result of conservative and reactionary government policies of high interest rates, profiteering, exploitation and inflation, does the Leader of the Government derive any pleasure from contemplating the inevitability of a similar situation developing in New Zealand as a result of the election of a conservative, reactionary government in that country?
– I am a bit old fashioned. I always think that such problems are best left to the people concerned. If the people of New Zealand, after having tried a Labour Government for three years, threw it out, I think they are better judges than Senator O’Byrne or myself.
– I direct a question to the Leader of the Government in the Senate. Is it a fact that the Export Develops ment Council, under the chairmanship of Sir John Allison, was set up by the Government to advise it on ways and means of increasing Australia’s export trade? Has the council made a survey of the port facilities throughout Australia, with particular reference to those ports in the eastern States from which coal is exported, with the object of reducing the cost of loading coal by providing additional equipment which is necessary to reduce loading costs?
– I do not know whether the council headed by Sir John Allison has applied its mind to this problem. I doubt whether it has. I do not remember seeing anything from the council on this matter. Undoubtedly, one of the handicaps to increasing our export trade in coal is the lack of adequate port facilities, particularly at the ports of Newcastle and Port Kembla. It is not so much a question of reducing costs, although, in all conscience, that is important enough. The present situation is that the port facilities cannot physically handle the volume of trade within a reasonable time. Therefore, it is not only a question of costs, but also one of inability to handle orders without delay.
– Will the Minister representing the Minister for Primary Industry ask his colleague to consider and comment on the report, which has just been issued, by the Victorian Inland Meat Authority, particularly as the report appears to differ considerably from the opinions expressed recently by Commonwealth primary production authorities to the effect that there is no need1 for alarm over allegations of a decline in our meat production?
– I shall ask my colleague, the Minister for Primary Industry, whether he will consider and comment on the report to which the honorable senator has referred.
– I address a question to the Leader of the Government in the Senate. Is the Government just as embarrassed as are Australians overseas and within Australia as a result of the Government’s neglect to make an appointment to the important position of Minister for External Affairs? Is the inordinate delay which has occurred in making an appointment to this important position since it was vacated1 by Lord Casey an indication that the Government has not sufficient confidence in the personnel available to it to make such an appointment? As the work of this portfolio has been left in abeyance during a period when there have been very important international developments, will the Minister inform the Senate whether Australia can expect to have very shortly a leader for the leaderless legion of the department that deals with foreign affairs? Will he endeavour to have a statement made by the Government outlining the policy that has been applied in relation to the many important developments in international affairs that have occurred since Mr. Casey was elevated to the peerage and took his place in the House of Lords?
– With Senator Cooke, the wish is father to the thought. He only hopes that the views he has expressed1 are correct. Deep in his heart, he knows, as do the rest of us, that there is complete confidence in the present administration of the Department of External Affairs.
asked the Minister representing the Treasurer, upon notice -
– The following answer has been provided by the Treasurer: -
The information sought is not available in the Treasury and can be supplied only by each service department. The Acting Treasurer wrote to the Minister of each department requesting that the information relating to his department be provided direct to Senator Wright. I understand that the Acting Treasurer wrote to Senator Wright informing him of this action.
asked the Minister representing the Treasurer, upon notice -
– The following answers have been provided by the Treasurer: -
The Commonwealth Development Bank commenced operations on 14th January, 1960. Between that date and 30th June last, 457 (net) loans were approved for primary producers. Between 30th June and 9th November, 1960, a further 599 (net) loans were approved for primary producers.
asked the Minister representing the Prime Minister, upon notice -
What performance, in term3 of miles per gallon, have the departments in charge of Commonwealth motor cars experienced over a recent period of twelve months in respect of Holden cars in (a) the Australian Capital Territory, and (b) elsewhere?
– The following, answer has been provided: -
For the twelve months ended 30th September, 1960, the Holden sedans operated by the Transport Section, Department of the Interior, in the Australian Capital Territory averaged 221 miles, per gallon and those operated by the Department of Supply in all States averaged 23 miles per gallon.
asked the Minister representing the Minister for Air, upon notice -
In order to minimize any possible danger to aircraft passengers, will the Minister arrange for the provision of fire and ambulance equipment onRoyal Australian Air Force airfields, where there are no civil emergency landing facilities, for use in case of emergency landings by civil aircraft?’
– The answer to the honorable senator’s question is as follows: -
Fire-fighting and ambulance equipment is provided at all aerodromes occupied by the Royal Australian Air Force. This equipment would beavailable in the event of a civil aircraft making, an emergency landing.
– On 12th October, Senator McManus asked the Minister representing the Treasurer a question without notice relating to the investment of life insurance company funds in Australia.
I informed the honorable senator that I would bring his question to the notice of the Treasurer with a view to obtaining whatever further information might be available. The Treasurer has now advised me as follows: -
New loans granted by life insurance companies during the years ended 30th June. 1959. and 30th June. 1960. were -
New sums insured increased from £553,352.000 for the year ended 30th June, 1959, to £724,195,000 for the year ended 30th June, 1960. However, there is no immediate relationship between this increase and the amounts available for investment.
Report of the Public Accounts Committee.
– On behalf of the Public Accounts Committee, I present the following report: -
Fifty-second Report - Report of the AuditorGeneral Financial Year 1958-59 Part II.- and move -
That the paper be printed.
This is Part II. of the first report of the Public Accounts Committee to be based exclusively on the annual reports of the Auditor-General. Part I. of the report has been presented already as the fiftieth report of the committee.
A number of important matters are detailed in this report but the committee has been concerned particularly with the following significant conclusion resulting from its investigations: The role of the Auditor-General is both essential and important, but the full benefit of his endeavours will not be obtained without an effective follow-up of his reports. In our opinion a number of departments have failed to give sufficient consideration to comments in his annual reports whilst the Public Service Board and the Treasury in some cases should have followed up these matters more actively.
Question resolved in the affirmative.
Debate resumed from 29th November (vide page 1798), on motion by Senator Paltridge -
That the bill be now read a second time.
– This is a small bill with two purposes. One is to cure what is thought to be a constitutional defect in the Explosives Act passed in 1952, and the other is to extend the provisions of the act to explosives under the control of visiting friendly powers who are in Australia with the concurrence of the Australian Government. It is rather interesting to note that the Explosives Act was passed in 1952, and that at the time the Opposition opposed the motion for the second reading. On referring to the Journals of the Senate of 5th November, 1952,
I find that at the instance of Senator Arnold the Opposition moved -
That the bill be delayed until the Senate has a full opportunity to study its provisions and consider its impacts on State laws and State instrumentalities and authorities.
Some honorable senators may recall the debate. They may remember that Senator Seward, from Western Australia, since deceased, voted with the Opposition in favour of that amendment. It might interest the Senate to know that there have been quite a few changes in the personnel of the Senate since then. I look at the list of the senators who voted in the division. From this side of the House, Senators Ashley, Morrow, Ryan and Critchley have gone, and from the Government side, Senators Seward, Cormack, Guy, McLeay, G. J. Rankin, Robinson, Spicer and Tate.
The act was amended in 1957. The constitutional difficulty that was foreshadowed in 1952, when the Opposition pressed for the postponement of the measure, obviously had not been attended to by 1957. It comes as rather a shock to find that although this matter has been raised and pressed by port authorities in the States, it has taken this Government eight years to correct the position. The difficulty arises from the provision in the 1952 act that the act should extend not only to explosives used by the Commonwealth but also to explosives that were capable of being so used. I have before me now a letter that was before me in 1952. It was sent to me by Mr. Eric Reece, who was at that time the Minister for Mines in Tasmania and is now the Premier of Tasmania. He enclosed a copy of a letter addressed to him by Mr. W. H. Williams, the Tasmanian Director of Mines. I should like to place in the record a very brief extract from that letter to show that the problem was then well understood by the State. The letter is dated 24th October, 1952. It reads -
The State Explosives Act provides that nothing in the act shall be deemed or held to extend or apply to explosives provided for naval, military or police purposes.
Referring to the Commonwealth legislation, it states -
If, then, the proposed legislation limited itself in a similar manner to explosives for use by the naval, military and air forces it would be inconsistent to object to the bill. If, however, the legislation is designed to apply to explosives capable of being used by the military or other forces of the Commonwealth and there are no limitations in control as included in the bill, then practically all the explosives being used in commerce, industry and other -.pursuits, not .being naval, military or air, could .be controlled by ‘the Commonwealth to the ‘.exclusion of the authority of the State. Any such intention could have a gravely embarrassing effect upon activities such as mining, quarrying, public works and other instruments of commerce and industry.
That was the kind of problem that actuated the Opposition in 1952 in moving that the bill be delayed until it had ‘been discussed with the various State authorities. The problem has apparently been on the tapis during all of the intervening period. Although the act was under review in 1957, we now have the Government, not only admitting the validity of the criticism and the wisdom of the action of the Opposition, but conceding that in applying the 1952 act to explosives that were capable of use by the naval and military forces it had gone too far. As the Minister said in his secondreading speech, it had done something which was unconstitutional and which left the validity of the whole act open to attack.
Secondly, the bill proposes that the act shall apply not only to explosives under the control of our defence forces but also to explosives under the control of any friendly forces of another nation which, with our consent, are visiting Australia. We have no objection to that proposal.
I conclude by a reference to two sections of the act. I should like the Minister to indicate, if he is in a position to do so, how many orders have been made under section 6 (1.) (a) and section 6 (1a.). Subsection (1.) provides -
The regulations may empower a person -
to provide, by order, for any matter which may be provided for by the regulations;
The berthing of vessels and that kind of thing was in contemplation. Sub-section (1a). which was inserted by the 1957 legislation, provides that the regulations may provide that where, under the sub-section I have just quoted, a berth is allocated in a port and the person making the order for the allocation of the berth is not satisfied with the type of berth available, that person shall be in a position to give directions as to where the vessel ought to be berthed. I realize that it is necessary for the Minister to seek advice on the questions I wish to direct to him. Perhaps he would prefer me to (deal .with the matter at ‘the .committee stage.
– I should like the Minister to indicate how many orders were made under either of those sub-sections in the act. Whether there were many or few would be of interest. The Opposition does not oppose the measure.
– in reply - I am informed that 84 berthing orders have been issued since the regulations came into force in July, 1953. The total quantity of explosives handled from 1953 to date was as follows: - In Victoria, 440 tons; in New South Wales, 1,392 tons; in Queensland, 3,506 tons; in South Australia, 387 tons; in Western Australia, 66 tons; and in Tasmania, 123 tons.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from 29th November (vide page 1799), on motion by Senator Paltridge -
That the bill be now read a second lime.
– There have been approximately six amendments of the Seamen’s Compensation Act, which was passed originally in 1911. Those amendments were concerned primarily with increases in benefits payable under the act. The measure now before us extends the application of the act to Australian seamen who serve in a ship which is engaged on a delivery voyage to or from Australia. It was very unfortunate that it took a tragedy to bring to light the fact that such seamen were not covered by the act. I refer to the disappearance, with the loss of all hands, of the vessel “ Ian Crouch “, which at the time was coming to Australia from Hong Kong.
For the purpose of clarifying and restating the application of the act, section 4 is to be repealed and replaced with another section. In this connexion, I should like to quote a passage from the second-reading speech of the Minister for Civil Aviation (Senator Paltridge). The Minister said -
These purposes are being effected by inserting a definition of delivery voyage in section 3, and by repealing section 4 and replacing it with a section -
which clearly expresses the desired application of the act, which, except for delivery voyages, is in fact the application that has been followed in practice, and clearly shows its application in relation to the Territories of the Commonwealth; and
which includes a provision applying the act in relation to the employment of seamen for the purposes of a delivery voyage of a ship, whether British or not, and, if British, whether registered in Australia or not. Such seamen must have been engaged in Australia, whether or not under articles of agreement entered into in Australia, upon terms entitling them to, or to payment in respect of the cost of, transport from Australia for the purpose of joining the ship, or transport to Australia after leaving the ship. 1 believe that although the legislation we are now considering was not in operation at the time of the loss of the “ Ian Crouch “, the employers have paid compensation to the relatives of the men who lost their lives. The action of the employers is to be commended.
I should like to make a few remarks about workers’ compensation legislation throughout Australia. We of the Australian Labour Party believe that there should be a streamlining of the method of paying workers’ compensation. The desired state of affairs will not be achieved until the Commonwealth is given complete power over industrial matters. Although the majority of the people in a majority of the States did not give that power to the Commonwealth at the 1946 referendum, a recommendation to that effect was made by the Constitutional Review Committee which was set up about two years ago. That committee also thought that the Commonwealth should have the necessary power to introduce a uniform workers’ compensation code for Australia.
– Who thought that?
– I believe that that was a recommendation of the Constitutional Review Committee but if I am wrong in my understanding, I shall withdraw that statement. In my opinion, one workers’ compensation act should cover the whole of the Commonwealth. Until the Commonwealth Parliament has power to legislate in that way, the laws on this subject should be streamlined. There should be one workers’ compensation act for Commonwealth employees, and it should apply in the Territories as well as in the States. I cannot see any justification for fixing different rates of compensation for persons employed by the Commonwealth in the States and those employed by it in territories under the control of the Commonwealth, such as the Territory of Papua and New Guinea.
The Government has introduced uniform legislation in respect of other matters, and I believe that if it introduced uniform workers’ compensation law, that action would meet with the approval of people in all walks of life. It is true that the majority of employees are covered by State workers’ compensation laws, but surely it it is begging the question to say that coordination of those laws is primarily a matter for the States. The introduction of uniform legislation in other fields to coordinate State laws has always been at the instance of the Commonwealth. It seems to me to be most unsatisfactory that there should be numerous workers’ compensation acts throughout Australia. I understand that the scale of payments and benefits under the South Australian act is tha lowest in Australia. The liability of employers and the rights of employees and their relatives also vary according to the State or Territory concerned. I urge the Government to introduce uniform legislalation. We of the Opposition do not oppose the bill before the Senate. We believe that, although its introduction is the result of tragic circumstances, it nevertheless is a step in the right direction, and we support it.
– in reply - The main purpose of this small bill is to effect a very important amendment whereby Australian seamen on delivery voyages will be included, for compensation purposes, within the provisions of the act, whereas they are now excluded. I gathered from the remarks of Senator Drury, who spoke for the Opposition, and who took the opportunity to address himself rather generally to the question of compensation, that the Opposition does not oppose this bill. I express the gratification of the Government for that attitude.
Senator Kendall has expressed to me his interest in the treatment of the survivors of the seamen who died when “ Ian Crouch “ went down. I am happy to be able to assure him that there is no need at all to make this measure retrospective to cover that unfortunate accident, because the owner of the ill-fated vessel has paid to the appropriate relative of each member of the crew who was lost a sum that is known to be not less than the amount which would have been payable had the Seamen’s Compensation Act then applied.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from 29th November (vide page 1833). on motion by Senator Spooner -
That the bill be now read a second time.
.- When the debate was interrupted last night, Mr. President, we were considering this bill which seeks approval of an agreement that has been made between the Commonwealth and Consolidated Zinc Proprietary Limited for the disposal of the Bell Bay aluminium undertaking for the sum of approximately £9,000,000. I had adverted to one or two aspects of the transaction and, addressing myself to the agreement, had referred to the question of valuation. In that respect, I only wish to add that when we were discussing a statement by the Minister for National Development (Senator Spooner) some two or three months ago, I referred to the aspect of valuation at that time also. In view of that reference, it is surprising that the Minister’s second-reading speech on the bill that we are now discussing made no reference to the subject of valuation. Are we to take it that speeches made in this chamber are entirely rhetorical exercises, having no effect at all on the Government? I am waiting for a reply to my previous comments.
The next aspect of the agreement that is of some interest to me is whether it contains a provision that definitely guarantees the continuance of the industry at Bell Bay. It will not escape the attention of honorable senators that all kinds of business considerations almost certainly will develop to ensure the continuance of the industry, but on the other hand, it is not a foregone conclusion that, should other competitive undertakings indicate to Consolidate Zinc Ltd. that they could absorb any loss that might result from the abandonment of the Bell Bay undertaking, it would not be abandoned.
– Abandon a £9,000,000 industry?
– Senator Anderson says, with an exclamatory note in his voice, “Abandon a £9,000,000 industry?” I would think that that is almost petty cash in relation to the cost of an industry of this sort over a period of about fifteen years.
I am not putting forward this proposition just for the purpose of argument. I believe that the business considerations to which the company has committed itself will, from a commercial point of view, warrant our having confidence that the industry will be continued there. I also have regard to the fact that although I understand the Weipa deposits are contractually committed by Queensland and the Commonwealth, they will be under the legislative jurisdiction of Queensland or the Commonwealth. Therefore, to some extent this company will owe its obligations in that respect to the governments which I have mentioned. Nevertheless, I am warranted in emphasizing the fact that I see nothing in the agreement to guarantee the continuance of the industry, except an undertaking that so long as the purchase price is unpaid the industry will be carried on. In that connexion. I do not imagine that it will not be possible to repay the purchase money. Therefore, limited to that period, it is not a contractual guarantee.
Having regard to the capital of the contracting company and its assumed wealth - I have not investigated it - I ask whether the agreement provides for security over the company’s undertaking in favour of the Commonwealth in respect of the unpaid purchase money. I have not had the fullest opportunity to examine the agreement. I received it only last night, and I have been under great pressure since then. I merely invite the Minister’s attention to that point. Another aspect of the agreement to which I wish to advert, Mr. President, is the provision in relation to tariff protection. It is important to note that the company has been guaranteed a tariff, which is to continue for four years, to give it protection on a margin of £232 10s. a ton, as against £271 a ton. But, as a counter-balance to that, the company has undertaken that unless compelled by circumstances beyond its control - a very vague factor - after four years it will not seek tariff protection. I think the Senate is entitled to have an assessment of these matters put before it, either in reply to this debate or at the committee stage, so that we may make an intelligent judgment on the commitment into which the Commonwealth is entering.
I felt bound to refer to those aspects, Mr. President, because I should not readily approve of this bill without ordinary business information on them. However, I wish to say in a general way that I believe the Minister is to be congratulated on this transaction, considered in isolation. Great bauxite deposits had been discovered in north Queensland and they gave governments in Australia a tremendous authority over the development of the aluminium industry in Australia. On the other hand, they were saddled with this undertaking at Bell Bay which was not showing prospects of great commercial success. I believe that it was a business transaction of great merit to secure capital to develop the Weipa deposits and at the same time to utilize part of that capital not merely for the acquisition of the Bell Bay undertaking, but. what is more important, for its expansion.
If the Bell Bay undertaking had been subjected to world competition from undertakings established elsewhere with the advantage of external costs, the Bell Bay undertaking could have been supported only by increasing tariffs. T remind the Senate that in one of the commission’s recent annual reports, the commission in- its innocence - I will credit it with that - appealed to the Commonwealth Government to use its power to restrict imports in order to protect the industry so that it could survive on the level of Australian costs. That is the sort of thing that shows the peril to which this industry might have been exposed if a big competitive industry had been established nearby on more advantageous external costs.
– Or even a more modern plant within Australia.
– Yes, that is an aspect, too. When I consider that the Minister has been able to bring to the Bell Bay undertaking the capital that Consolidated Zinc Corporation Limited controls and secure from the company a definite undertaking to expand the plant as soon as practicable after this agreement, so that its output will go from 12,000 tons a year not merely to the present projected output of 16.000 tons a year but to 28,000 tons a year, I find a great measure of reassurance that this industry will be established on a competitive and permanent basis. In addition to that. Mr. President, in the agreement there is. although not a definite contractual obligation, an expressed objective of the company to increase production to 40.000 tons a year.
With an eye to optimism, a hope of development and a hope that Australian costs in the next ten years will become more reasonable than they are now, relatively speaking, T believe one can reasonably hope that these arrangements will guarantee the continuance of the industry at Bell Bay and, what is more important, its expansion to a level where it will have a reasonable commercial output. So, I think the agreement is very satisfactory. I am re-assured of that by the fact that the Premier of Tasmania has seen fit to approve of these arrangements to the extent that his Government is prepared to continue providing its quota of capital as a joint arrangement with the company. The voting power which the Tasmanian Government has in the combined company, as against that of Consolidated Zinc, is not known to me. However, there is the balancing factor that the industry is located on Tasmanian soil, and Tasmania still has some legislative jurisdiction with regard to factors vitally affecting the industry’s advancement and success.
I cannot leave the matter there without going into the wider field. Since the bill was introduced yesterday I have been able to get information with regard to this industry, not merely on a TasmaniaQueensland basis, but on an Australasian basis. I want to express my disappointment that we have not been fully informed on this matter. I expect there are circumstances that prevent the publication of these matters to mere members of Parliament, but I think it would have been satisfactory to the whole of the Senate, and especially to Tasmanian senators, if we had known the extent to which efforts had been made to utilize Tasmania’s resources for hydroelectric power so as to expand the output of the industry in Tasmania much beyond 40,000 tons a year.
As Consolidated Zinc has announced its proposal to establish in New Zealand an undertaking having a capacity of 120,000 tons a year, my mind rests unsatisfied that Tasmania could not, with the help of the Federal Government, have secured a greater proportion of the Weipa material for processing in Tasmania with the aid of hydroelectric power. I understand that requests were made to the Tasmanian authorities for 600,000 kilowatts of power. It was thought that the production of that power in Tasmania would involve a capital cost of perhaps £100,000,000 and would absorb about one-half of the water resources still available for use in hydro-electric development. The mere statement of those factors excites my keen consideration of whether the Tasmanian Government and authorities, with the aid of the Federal Government, could have taken advantage of the Weipa deposits in Queensland to raise the capacity of the industry in Australia to a much higher level than 40,000 tons a year.
I know that it is thought that the cost of hydro-electric power in New Zealand would be less than in Tasmania, but that has yet to be proved. My understanding of the position is that the cost of power in New Zealand will not be fixed by contract, but will be subject to the development of the water resources by the company on its own account.
– The site is 80 miles away, too.
– Senator Laught tells me that the location is 80 miles away. I am glad to have any information on these matters. In considering this subject, we should bear in mind the importance that we place upon the incidental defence aspect of an aluminium industry, the growing importance of aluminium to our industrial fabric, and the desirability of developing an aluminium industry in Australia with a view to exporting the surplus, at a time when exports are so important. My mind rests unsatisfied that everything has been done that should have been done to localize in Australia at least a part of the industry that is going to New Zealand.
I make these remarks because I think that this is a matter of great national importance, to which the Senate is bound to give its attention when considering this bill. I cannot refrain from repeating what I said last night. I think this is the sort of thing on which a committee to consider the bill could inform itself most responsibly in the course of the next two weeks. It could enlighten the Senate as to the pros and cons, not merely of the expressed terms of this agreement, but of all the other incidental factors that have now been brought to light. The Government disclosed the New Zealand arrangements only a few days ago, after the original announcement of its disposal of the Bell Bay undertaking and after the terms of the projected expansion there had been fixed. That provides, to my mind, a background against which this proposal takes on quite a different shape. I think that the bill is sound and should be supported, but there is a feeling that perhaps we have not given it sufficient consideration against that wider background.
.- This bill seeks parliamentary approval to the sale by the Government of the Australian Aluminium Production Commission’s works at Bell Bay. The interest of the people of Australia is focused on this matter, which is of the greatest importance to the future economy of the country.
I agree with many of the things that Senator Wright has said in relation to the features of the agreement. He posed to the Government questions concerning matters that were not fully explained in the second-reading speech of the Minister for National Development (Senator Spooner). Not only the members of the Senate, but the whole of the people of Australia - whose interests are involved in this transaction - are entitled to the information that he has sought. For instance, the honorable senator asked whether a continuation of the industry at Bell Bay had been guaranteed. If the Government had gone into this matter thoroughly, and if it had the interests of Bell Bay at heart, as it professes, it would have written into the agreement a stipulation that the industry must continue in Tasmania.
As Senator Wright stated, if at some future date the company that now has a controlling interest in this industry found that its continued operation was uneconomic, it would be able to abandon the industry and absorb any losses so incurred. Why has it not been written into this agreement that the continuation of this industry at Bell Bay will be assured by all the force at the command of the Commonwealth Government? In its handling of the aluminium project at Bell Bay the Government has betrayed Australia. In 1944, this country was at war. The government of the day was experiencing great difficulty in obtaining supplies of aluminium. It decided to establish an aluminium industry in this country to provide us with this essential metal for defence purposes. In addition, we would no longer be dependent on the aluminium monopoly that exists in the western world. The primary purpose in establishing the industry was to ensure that Australia would have all the aluminium that she needed for defence purposes. We learnt the lesson that we could not rely on overseas countries to supply our needs in time of war. Even less reliance could be placed on overseas countries in this modern age when submarines are able to cruise below the water for long periods and attack shipping lanes. In 1944, the Labour Government decided to establish the aluminium industry in this country so that we would no longer be forced to rely on the overseas combines for our supplies of this important metal. But to-day, to the eternal shame of those responsible, this industry is being betrayed.
– The Premier of Tasmania does not think so.
– I will deal with that matter later. Over a period of years we have seen a softening-up process applied to the Tasmanian Government, first by the former Minister for National Development,
Mr. Beale, and later by the present Minister (Senator Spooner). A gun has been held at the head of the Tasmanian Government. We in Tasmania are very proud of this industry. We are very proud of the Tasmanian Government’s efforts to encourage and assist the industry. We are proud of the fact that the Tasmanian Government has invested nearly £8,000,000 in the development of a hydro-electric scheme at Trevallyn, which is supplying power for the industry. We are also proud of the fact that the Tasmanian Government has spent more than £1,000,000 on the construction of a highway to give access to the industry at Bell Bay. We are proud of the fact that almost £3,000,000 has been spent on housing in the vicinity of Bell Bay. At a cost of almost £1,000,000 the Tasmanian. Government has set up a regional water scheme to take fresh water from the vicinity of Launceston a distance of 40 miles to Bell Bay. We are proud of the fact that, associated with the development of this industry, the Tasmanian Government has built schools, hospitals and recreation facilities. All that reflects great credit on the Tasmanian Government. But all honorable senators know that Tasmania has a very limited population and very limited resources. The Commonwealth is the sole tax collector, and the Tasmanian Government is forced to rely on hand-outs from the Commonwealth after it has expended the revenue collected. The Commonwealth has held a gun at the head of the Tasmanian Government, forcing it to reach an agreement so that the continuation of this industry at Bell Bay might be guaranteed.
Originally, Tasmania was a partner with the Commonwealth in the undertaking at Bell Bay, and to the limit of her capacity she contributed her share. But in 1952, when a new agreement was made, and again in 1954 and in later years, Tasmania was pushed out on a limb and, in order to retain an interest in the industry, she was forced to take whatever was handed to her. Senator Spooner has referred to an agreement entered into with the former Premier of Tasmania,, Sir Robert Cosgrove, but when Mr. Reece took over the reins of government in Tasmania he was not aware of that agreement. The Government is placing great reliance on a letter written by Mr. Chifley, which is alleged to have, committed the Commonwealth with regard to British Aluminium. When Mr. Reece became Premier he said that he would resist with the utmost vigour any proposal by the Commonwealth to put the Bell Bay undertaking into the hands of private enterprise. In answer to that, Senator Spooner presented Mr. Reece with un fait accompli, and told him that the Commonwealth had already made arrangements with the previous Premier. The Commonwealth knew that Tasmania was short of funds. The Commonwealth knew that it had Tasmania over a barrel. This Government has acted as a standover merchant would act. I share the delight of all Tasmanians in having this industry in our State, but I want the people of Australia to know some of the facts behind the agreement that we are being asked to ratify.
– In other words, you would like it both ways.
– I do not like to see our natural resources hawked around the world for sale. The pattern of events in our aluminium industry has followed the pattern of events associated with our other important natural assets, such as ilmenite. We have never had the opportunity to develop our natural assets with our own capital. Our aluminium industry is now to be placed under the control of foreign capital. Our vast bauxite deposits are already under the control of foreign capital, and it is proposed that the smelting work associated with the industry should be carried out in New Zealand. We should have regard to the pattern as a whole when we are considering the agreement itself.
The industry at Bell Bay has been in production for about four years. In 1955-56. it was in production for only several months and naturally was unable to make a profit. In 1956-57, the commission made a profit of £52,000; in 1957-58, a profit of £25.000: in 1958-59, a profit of £158,000; and this year a profit of £122.000. Since its inception this industry at Bell Bay has been messed around possibly more than any other industry in the Commonwealth by various influences. The events leading up to its establishment, the maladministration as revealed as the result of the investigation of the Public Accounts Committee, and the inflationary processes that have lifted costs to such a great extent have weighed greatly against it. The industry has also been faced with uncertainty over the years. It knew very well that the Commonwealth Government had lost interest in it and was looking for a way out. All these factors have made it very difficult for the industry to do more than reach the stage where it is just making a profit.
Although bauxite has been discovered at Weipa we have very little information about the deposits there. Figures should have been made available to the Parliament. Judging from reports, the Weipa deposits have a very high aluminium content. 1 understand they give the highest yield in the world. Although these high-yielding deposits have been discovered in our own country not one ton of bauxite from Weipa has ever been treated by the Australian Aluminium Production Commission in Tasmania. These deposits have been sold to foreign investors before they were experimented with by the Tasmanian industry.
– It has not yet been possible to ship any bauxite from Weipa.
– We have been able to ship bauxite from Malaya and India. Much of the bauxite that has come from overseas has had to be unloaded from the overseas ships in small craft with salt water spraying over the loads. This has been the cause of many of the difficulties experienced by the commission in Tasmania. The salt content of the bauxite coming from Malaya has caused a big headache.
– lt has not yet been possible to ship any bauxite from Weipa because there is no harbour there.
– Experiments with Western Australian bauxite were carried out in Tasmania last year. The Parliament of this country has never been given any reports on those experiments although, I understand, nearly 1,000 tons of Western Australian bauxite were treated in Tasmania last year. The people of Australia have never been informed to what extent the use of Western Australian bauxite improved production and reduced costs at Bell Bay. We on this side of the Senate find ourselves basically opposed to the sale of the nation’s assets by this Government.
It does not matter whether the assets are iron ore deposits, bauxite deposits or any other natural resources; they should be developed to the fullest degree by the Australian people for the benefit of the nation. If private enterprise fails to develop them, the Australian Government has a responsibility to do so.
I should like to consider the terms that are being offered for the sale of this asset, and also to comment on the organization known as Aluminium Production Corporation Limited. Other speakers have mentioned the maze of companies involved in this organization. The Reynolds Metals Company of America, in conjunction with Tube Investments Limited, last January took over the British Aluminium organization. The British Aluminium Company was presumably the organization with which the Commonwealth Government was committed to deal, but the Government found itself dealing no longer with the British Aluminium Company but with Reynolds of America. The method by which the Reynolds Metals Company and Tube Investments Limited took over the British Aluminium Company could be regarded as fairly sharp practice. Without consultation and’ without any thought of the directorship itself the two American organizations took matters out of the hands of the British directors and deprived them of their position. After the Reynolds organization stepped into the shoes of the British Aluminium Company, it acquired an aluminium refinery in Quebec, Canada. Then it acquired a half interest in Comalco - the Commonwealth Aluminium Corporation. The Comalco corporation has two partners. One is the British Aluminium Company, which is under English and American control, and1 the other is Consolidated Zinc Corporation Limited which is also controlled from England. After this agreement has been signed we find that the Kaiser organization, another American controlled company, has come into the picture and will share in the aluminium industry cf Australia.
Over the last ten or eleven years £1,000,000,000 of foreign capital has come into Australia. I pose a question to the people of Australia: Is this capital coming into Australia for the sake of peanuts? Senator Spooner tried to make out that the aluminium industry had a production of only I i per cent, to 2 per cent, of the total world production. That might be so, but these overseas companies know very well the great potential of the aluminium industry at Bell Bay, particularly when it is tied up not only with the Weipa deposits, when they become available, but also with the whole aluminium cartel throughout the Western world’. We on this side believe that the Government should not enter into an agreement with foreign organizations and thus allow overseas capital to come into Australia to develop an industry whose ownership should be retained for the people of Australia. It should and could continue to be owned by the Commonwealth and Tasmanian governments. It is a fetish of the Government to hand over Australia’s assets to people in other parts of the world who are its spiritual allies. This is a process that has gone on continually during the Government’s occupancy of the Treasury bench. There has been sell-out after sell-out. We believe that in the long run this attitude of the Commonwealth Government and various State governments will be to Australia’s disadvantage. International organizations have no interest in Australia except in exacting compound interest and in getting their pound of flesh as quickly and easily as possible. The sale of this enterprise comes in that category. We are selling down the drain the heritage of the Australian people. We have the natural resources and we have the people who are capable of developing industry. We should retain the opportunity not only to increase our country’s wealth but also to ensure that the fruits of it are enjoyed by Australians. The main objection we have to this agreement is that it gives no guarantee at all that the industry at Bell Bay will continue in existence if it is found by the incoming company to be uneconomical.
– Uneconomical from the company’s point of view.
– Yes, there is no sentiment in international financiers. If they can make more money in New Zealand or if they can get cheaper electricity there, they will move the industry to New Zealand. They would not care whether the Australian people were the hewers of wood and the drawers of water - the wood and water joeys. They would send the industry overseas to the country where the highest profit could be made.
I believe that it should be an absolute “ must “ in the agreement that sufficient aluminium be produced to supply our defence needs. There is no obligation upon the company under the agreement to expand production from 28,000 tons to 40,000 tons. Much play is made on the latter figure. Expansion of production from 12,000 tons to 16,000 tons in 1962 is under way. This has been achieved by the Tasmanian Government under its own steam. The incoming company will increase production to 28,000 tons. Under the agreement, that is as far as the company needs to go in expanding production. Foreign capital is interested only in what it can get out of the undertaking.
The Minister said that in the negotiations there was no hole-in-the-corner activity. We know that other companies were interested in making a bid. How do we know that the terms and conditions of the agreement are the best that could have been achieved? The last balance sheet of the commission shows that the value of salable aluminium produced last year was £3,750,000. Under the agreement, a deposit of £2,500,000 is required, so one year’s production will cover the deposit. In addition, there will be reserves of material available at Bell Bay. The agreement also provides for four yearly instalments of £250,000. To a company that is engaged in projects involving the expenditure of £100,000,000 in one place and £120,000,000 in another, an amount of £250,000 a year is only chicken feed. This is virtually giving the undertaking to the company. With an increase in production to 16,000 tons, there will be a consequential reduction in costs and an increase in profits. The basic industry is there, and as production increases so profits will increase. The yearly instalment of £250,000 for four years is practically assured from profits. Until 1964 the incoming company will be able to earn at least the amount of the instalment.
– It will have to spend a tremendous amount of money to get it.
– The incoming company will not be spending it. The money necessary to expand production to 16,000 tons has been spent. That expansion is under way. That production will be achieved by 1962, when the purchasing company will come in. A profit of £120,000 was made last year. The directors, in their annual report, referred to difficulties in testing certain types of bauxite, the cancellation of the Indonesian agreement and the need to obtain supplies from India and Malaya. All of these difficulties were encountered in the very year in which Consolidated Zinc Proprietary Limited was considering taking over the undertaking. The company was not deterred, because prospects of great profits existed.
From 1965 to 1975, when the highyielding bauxite of Weipa will be fully available, and when production will be expanded to 28,000 tons a year, the company is to pay instalments of £625,000 a year, but it is not required to pay interest or to make repayments until it earns £1,000,000 a year. This is the most generous give-away ever seen. The final instalment of £605,000 is to be paid in 1976. There are generous terms in relation to payment of interest, over and above taxation, and a return of 6i per cent, on the project.
In another measure that is before the Parliament, penalties are provided for betraying the country. This agreement is a betrayal of future generations of this country, who will have to pay through the nose, and by sweat and toil, to produce profits to be sent overseas to shareholders in foreign countries. That type of betrayal will be judged by future generations as well as by this generation. Because the Government has the necessary numbers, there is no way in which we can prevent approval of the agreement. I wish that there were some way. I wish .that the Tasmanian Government and individual Tasmanians were not so deeply involved in this project that we could say straight out that it is un-Australian. The bill seeks parliamentary approval for a sell-out or a give-away to a foreign controlled organization. I hope the people of Australia will realize that this Government has sold out or has given away another of its great undertakings which, with the application of the ability and the adaptability of our people, could have been developed into an important secondary industry the profits of which could have been used, first, for the benefit of our own people and then for the purpose of producing goods for export to offset our balance of payments situation. The agreement gives away to overseas investors something which we can ill afford to lose.
– I rise to support the bill. I note with interest that Senator O’Byrne, a Labour senator from Tasmania has indicated that he will vote against the measure.
– I did not say that I intended to vote against the bill.
– 1 shall correct myself. I indicate to Senator O’Byrne and other honorable senators that the Leader of Opposition (Senator McKenna) said that he opposed the bill. With my knowledge of the ways in which Senator O’Byrne acts, I should imagine that he also will oppose it.
– Is he going to oppose the bill and then vote for it?
– I really do not know. We have before us an agreement which was entered into on 25th November, I960, between a number of important parties in this sphere of activity - the Commonwealth, the State of Tasmania, Consolidated Zinc Proprietary Limited, the Australian Aluminium Production Commission and Australian Production Corporation Limited. That agreement has been signed for and on behalf of the State of Tasmania by Mr. Reece, in the presence of one F. J. Carter. The attitude of the Leader of the Opposition, and presumably that of Senator O’Bryne, would, if carried into effect, have the effect of not ratifying an agreement which has already been entered into by the Labour Government of Tasmania, the Commonwealth and other parties. If Senator O’Byrne votes against this measure, he will have to stand up in Tasmania and be counted on that very point - that of refusing to ratify an agreement which has already been entered into by the Tasmanian Government and which I presume the Tasmanian Parliament will duly approve. I suppose that the agreement has been examined by the Tasmanian Government and that it has that Government’s full approval, as witness the signature of the Premier of Tasmania, the Hon. Eric Elliott Reece.
The agreement covers the sale of what is generally known as the Bell Bay plant and also sets out details of the expansion of aluminium production activities in Australia. Briefly, the agreement covers the sale for £11,000,000 or an undertaking which we are told cost £11,200,000. Last year, the profit on the capital involved was 1.1 per cent. In the year before that it was 1.4 per cent. I understand that a negligible profit was made in the immediately preceding years and that for a number of years while the plant was being constructed there was no profit at all. Standing alone, the sale price of £11,000,000 for a plant which cost £11,200,000 may not be attractive. But what is most attractive is that price plus, as is believed by honorable senators on this side of the chamber, the future expansion of aluminium production with all that that involves in Tasmania and on the Australian mainland, and the reduction of the gap between the quantity of aluminium we produce and the quantity we use. Unless we push ahead with production, when, as is believed, the use of aluminium increases in the next ten years, we will have a very large overseas debit. It is to the credit of this Government and the Government of Tasmania, which I presume Senator O’Byrne supports on every possible occasion, that they have seen the light in such a remarkable manner.
May I remind Senator O’Byrne of a statement in last Saturday’s Tasmanian press which was attributed to Mr. Reece. In that statement, Mr. Reece acclaimed1 the great agreement that had been entered into between New Zealand, Australia and the Kaiser organization of the United States for the expansion internationally of the production of aluminium. He is reported as having said that the pooling of British, Australian and American interests to develop the aluminium industry of Australasia was destined to make a significant contribution in the expansion of the Tasmanian economy. There is no expression
Df suspicion there like that uttered by Senator O’Byrne a few minutes ago. Mr. Reece added -
I feel that Tasmanians will welcome . . . an American company of the stature and capacity of the Kaiser Aluminium and Chemical Corporation.
So we have in the direct words of the Labour Premier of Tasmania the positive points that Senator O’Byrne attacked in this chamber this afternoon. I should think that Mr. Reece was in far closer touch with the true situation and the true feeling of the people of Tasmania and Australia as a whole when he made those statements than was Senator O’Byrne this afternoon. No doubt Senator O’Byrne will stand up and be counted on his statements when he gets back to Tasmania.
I like to regard the agreement which we are asked to ratify as being imaginative and as sparking off a great international development. This matter is not local to Tasmania. Admittedly, the production capacity of the plant at Bell Bay will expand from 12,000 tons to 28,000 tons a year, and perhaps even 60,000 tons and a number of fabricating industries will certainly arise in the vicinity of Bell Bay. But I like to look at the whole proposal from an Australian or, if 1 may put it this way, an Australasian viewpoint. The sparking off of the development which is envisaged1 in the agreement makes me look in the direction of New Zealand. A great opportunity for closer trade ties between Australia and New Zealand is presented.
It is interesting to recall that in the last decade of the nineteenth century we thought that perhaps we might federate with New Zealand, and that country would become the seventh State of the Australian federation. Unfortunately, that was not to be. New Zealand and Australia have continued to be separate nations. In the agreement that we are discussing, I see a chance for us to come closer to New Zealand in the realm of trade. I hope that improved trade relations and air services will follow in the wake of the development that is envisaged in the aluminium industry. There may even be a tax treaty. After all, Mr. Acting Deputy President, the expenditure of £125,000,000 by 1966 is contemplated in the development of this project in New Zealand and Australia. It is generally accepted that if private enterprise spends a large sum, such as £1,000,000, on a factory, a mine, or some other branch of industry, the government must match that expenditure £1 for £1. It is obvious, therefore, that this vast project will be of enormous value to both Australia and New Zealand.
Senator O’Byrne complained that the nature of the Weipa bauxite deposits has not been made fully known to the Parliament. Of course, the agreement that we are discussing will set in motion the real development of those deposits. I visited the Weipa area during the winter recess of the Parliament, and was most interested in what I saw there. It should be remembered that as far back as 1802, Captain Matthew Flinders recorded in his journal that he had seen red cliffs on the west coast of Cape York. It was not until July, 1955, that a Consolidated Zinc geologist, looking for oil, identified the red cliffs as most significant deposits of bauxite. From then on, surveys and testings were made. It is now clear that in the Weipa area there are the world’s largest deposits of bauxite of economic significance. I understand that the deposits extend over an area of 200 square miles. By the end of 1959, drilling had proved that there was in the area hundreds of millions of tons of economic grade bauxite. Reconnaissance work has suggested that the ultimate tonnage could exceed 2,000,000,000 tons.
It was my privilege to fly over the area at a very low level. When flying along the beach, one can detect in the red cliffs a depth of bauxite of as much as 15 feet. Numerous difficulties must be overcome, of course, and many millions of pounds expended, before those deposits, which are situated in one of the most isolated parts of Australia, can be transformed into alumina, which is the first step in the ultimate production of aluminium. It should be remembered, of course, that the deposits are in the sovereign territory of Queensland. I understand that in December, 1957, the Government of Queensland entered into an agreement with the Commonwealth Aluminium Corporation Proprietary Limited, or Comalco, in relation to the Weipa deposits, and that as a result of the agreement the company has the right to prospect over 1,000 square miles during the next twenty years. It is called upon to undertake certain work pursuant to the agreement.
One of the great problems associated with the development of the deposits is to find the means to transport the bauxite from this isolated site. Because of the large tonnage of general cargo, raw materials and other commodities that would have to be carried by sea to and from any alumina plant that was established, an all-weather port capable of accommodating large vessels would be necessary. During the last few years, the Royal Australian Navy has been greatly assisting in the investigation of the deposits by making surveys of some of the large tidal rivers in the area. A firm of Dutch harbour engineers has been co-opted to study the whole proposition. I understand that there is in Holland at the present time a large model of the area, and that the movement of waves and tides is being simulated so that the eventual deepening of the entrance to Weipa harbour can be done successfully. It is believed that a channel about 4i miles long will have to be dredged in. order to permit access by large ships.
It can be seen, therefore, that although certain critics of the project have been wondering why more information about it has not been given, many important operations have been going ahead. Among the problems to be considered are the provision of fresh water and the selection of a town site. I have seen the proposed sites both for the town and the reservoirs for water storage. As I see the matter, great work has been done in the development of the vast bauxite deposits. I believe that a market for agricultural products produced in the Cape York area may result when a town has been established there. As a South Australian, I look back’ over the years to the establishment of Whyalla, on Spencer Gulf. I remember that, 30 years ago, Whyalla was a small outpost of civilization. To-day, it is one of the great shipbuilding areas of the world. Its progress has resulted from just the same kind of clear-headed planning as that which I feel sure will be evident in the planning of Weipa.
So, Mr. Acting Deputy President, I give the agreement my blessing. I am confident that the Tasmanian Government has examined it thoroughly, just as has the Commonwealth Government. I predict that the gloomy forebodings of Senator McKenna and Senator O’Byrne will not be borne out. Despite what the supporters of the Opposition may say, I think that the Australian people will insist that this important scheme must go ahead. The agreement will give impetus to the im provement of relations between Australia and New Zealand. While it is true that the alumina that is made from the bauxite deposits of northern Queensland will go partly to Bell Bay and partly to Invercargill, the aluminium that is manufactured from it will go to Asian markets, and even, to markets on the west coast of America. I think that the ratification by the Senate of the agreement will have most beneficial results for both Australia and New Zealand.
– Mr. President, I approach this bill from the point of view of a Tasmanian senator. I believe that this agreement should be ratified for the betterment of Tasmania as a whole, and the northern part around the Tamar Valley in particular, so that development can take place in that area. The present situation is that only a very small aluminium industry is established there. All along I have been afraid that we might lose that industry very soon, especially after the discovery of the huge deposits of bauxite at Weipa, which eventually must have led to the establishment of other aluminium works in Australia or, as events have happened, in New Zealand. The possibility of maintaining Bell Bay would have been very slight indeed.
I am very pleased that the Government is entering into this agreement so that Tasmania will retain the aluminium works at Bell Bay. Had it continued the way it was going, in time that aluminium plant could have become unprofitable. Reasonable profits can be expected only if a tremendous increase in production takes place. When we consider that approximately 12,000 tons of aluminium a year has been produced at a small profit of about £120,000, we must compliment the management of the works on their efficiency. For such a small aluminium works to be making a profit shows the great efficiency of the works. I believe that when the plant reaches an output of 28,000 tons of aluminium a year it will be very profitable indeed. We may ask why we should allow a private company to come into this plant. As far as I can see, when plants are controlled by governments they do not remain very efficient and they do not expand. We want expansion in the northern part of Tasmania. This area is ideally suited to an aluminium plant and any ancillary industries that can be brought to Tasmania. There is a river port with a depth of 40, 50 or 60 feet right at the wharf. With cheap electricity also, Tasmania has something to offer to industry.
In regard to the establishment of a plant in New Zealand, Senator Wright suggested that the expansion of the Tasmanian aluminium works should have been investigated more fully. I agree with his suggestion. I believe that in the establishment of aluminium works in other parts of the world, the company that produces the aluminium sets up its own hydro-electric plant to provide power for its works. We- still have a great potential for the development of hydro-electric power that has not yet been touched in the very heavy rainfall areas on the west coast of Tasmania. Those areas have been surveyed to a certain extent. I believe that if the company had established a hydro-electric plant on the west coast of Tasmania, where there is none at the present, time, it could have had electricity just as cheap as that which it will produce in New Zealand. The result would have been that the production: of aluminium’ in Tasmania would have risen to more than1 the anticipated 28,000 tons a year, or even the 40,000 tons a year.
– But a State law forbids that. The Hydro-electric Commission has a monopoly, has it not?
– The Hydro-electric Commission has a monopoly, but that was overcome by the Tasmanian Government joining with private enterprise in the aluminium works. I think that problem can be overcome. I have heard that the Tasmanian Government is very pleased indeed with this agreement. I think this Government should be pleased with it. Over the years we have heard about the development of this plant, the money that was wasted in that development, and the prohibitive cost in certain cases. But after all that, the Government has been able to sell to the company all the waste and losses that were incurred in the early stages. Naturally, the company anticipates that it will make profits. The continuance of the works is for the good of Tasmania. Our fear was that we would lose the works unless they were expanded. Once this expansion takes place, especially when production is increased to 28,000 tons or 40,000 tons a year, there will be no possibility of the works being taken from Tasmania. As a Tasmanian senator, I wholeheartedly support this agreement. I hope that it will be carried to fulfilment in the very near future.
– I do not propose to speak at length on this occasion because I have spoken previously on this subject. This is another of the many outrageous actions of successive Menzies governments in transferring the ownership of national assets from the people to. private enterprise. However, it would not be gracious of me if I did not pay a tribute to the courage of the Tasmanians, a courage paralleled by successive Tasmanian Labour governments which were prepared to face up to their responsibilities in the development of the aluminium industry.
The responsibility was accepted in 1944 when the Federal Labour Government, realizing its responsibility for the defence needs of Australia, accepted responsibility for the development of an aluminium industry, which was then established through the combination of the Commonwealth Government, the Tasmanian Government and1 the Australian Aluminium Production Commission. The Tasmanian Government nominally agreed to contribute £1,500,000, which it did contribute; but no real tribute has been paid to it for the money that it contributed to the development of this industry by the provision of hydro-electric power which, I understand, cost £8,000,000, a housing settlement which cost approximately £1,500,000, a water supply which cost nearly £1,000,000, and a highway which cost about £750,000. Irrespective of how much the Commonwealth Government prides itself on spending money on the production of aluminium within the borders of Australia, a tribute must be paid to the Tasmanian Government for what it has done in accepting such a financial responsibility. Unfortunately, when the industry was established, there was not sufficient regard for the rights of Tasmania. That was one of the few occasions when Labour Governments in the Commonwealth and the State spheres were remiss. They should have given a greater proportion of the proprietary interest to Tasmania. If that had been done, possibly the present situation would not have occurred.
I think that the position was put to me very aptly by an outsider when he said1 that since 10th December, 1949, successive governments of the Commonwealth of Australia could be likened to a second-hand dealer who would deal in anything from monkeys to monkey wrenches - particularly when it came to selling the people’s assets, ls not that true? That is the position. Of course, we realize the Government’s attitude of mind. I am not saying that any of its deals have been shady, because the men associated with the Government are men of the utmost integrity. I have never challenged their integrity. But at least there have been shadowy deals in which the people’s assets have fallen into the eaglelike talons of big foreign interests. We have seen the gradual whittling away of profitable assets owned by the Commonwealth. This is merely another example of the Goverment’s horse-trading in connexion with the assets of the nation.
We are not decrying the right of the Tasmanian Government to support this agreement. It has no alternative but to support it. This is a matter of economic necessity for the Tasmanian Government. Tasmania is a small State, with limited financial resources, and much of its terrain is inhospitable. It has accepted as great a financial liability as it possibly could accept. Even now, it is prepared to accept the responsibility of finding another £3,000,000 in order to expand the production of aluminium from 12,000 tons to 28.000 tons a year. What have members of the Government said in justification of this agreement? They have said that they believe in free enterprise. That is their base philosophy. I am sorry, Mr. President; I should have said that it is their basic philosophy. They believe in free enterprise. Free, or relatively free, to whom? It is free to the foreign interests to whom they hand over the nation’s assets.
What is the history of this enterprise? It was established in 1944, when such an industry in Australia was believed to be absolutely necessary. It faced the initial difficulties that are inherent in any major undertaking. This is not the only enter prise of great magnitude that has faced financial difficulties and plant disabilities. Mount Isa Mines Limited, in its early stages, threw out hundreds of concentrating tables which would not fit into its ultimate pattern. That was just one of the unfortunate circumstances that are associated with the development of a big company.
We have heard the Bell Bay undertaking condemned because of an alleged measure of inefficiency, but it has got over its teething troubles. Last year it produced 11,900 tons of aluminium, so the Government now thinks that the time is opportune to hand over the undertaking to Consolidated Zinc - but not to that company alone. I do not believe that these negotiations have proceeded only during the last couple of weeks. Negotiations involving hundreds of millions of pounds take months to consummate. That is almost invariably the case in relation to major undertakings. There is to be a division of the spoils - the natural resources of Australia. We on this side of the chamber, in common with many other people in this country, honestly believed that we had emerged from the period when we were wood and water joeys. It was realized many years ago - before I was born, incidentally - that our raw materials were being sold overseas without seeking offers from competitors of the buyers. Dividends are still being paid to overseas landlords who own some of the prized possessions of this country. Having gone through two world wars, we thought that we had passed through that phase of our history and that we were mature enough to capitalize the natural endowments of Australia. However, when we looked like moving into the realm of secondary industry - when we established an aluminium industry which is important now and is likely to increase in importance in the future - we found that we were to be sold out by this Government because of its basic philosophy, its belief in free enterprise. It has disposed of our bauxite resources, with the exception of some in Western Australia which are controlled by Western Mining Corporation. The two major deposits of bauxite - the ore from which aluminium is obtained - are at Gove in the Northern Territory and at Weipa in north Queensland. They are recognized as the greatest commercial deposits of bauxite in the world. They are to be handed over, not to an Australian company, but to overseas interests. We find that the Tasmanian Government will hold a one-third interest in the manufacturing works - the smelters - at Bell Bay. The Consolidated Zinc Corporation has sold one-half of its portion to the Kaiser Chemical Corporation of America. About 12 per cent, of the shareholding in Consolidated Zinc is held in Australia.
There is no provision in this agreement to preclude the closing down of the works at Bell Bay. If this arrangement meant that there would be a major contribution to the Australian economy, and to the Tasmanian economy in particular, we would be all for it. But there is no provision in the agreement stating that the works shall not be closed down. Gigantic international enterprises have closed down particular projects in the past, in the interests of their international approach to business. A few million pounds mean nothing to them, lt may be that this company, in dividing the aluminium markets of the world, will come to an arrangement with the Reynolds Corporation of America and will decide that Bell Bay is not an economic proposition, and so close it down. The company could embarrass the Tasmanian Government by increasing its expenditure to such an extent that that government could not keep pace with it. The use of this technique is not unknown for the purpose of freezing-out a small partner in a big business, particularly one of this magnitude.
Let us look at what has happened. The bauxite deposits at Gove have been handed over, together with the right to develop the hydro-electric power potential of the Purari River. These rights have been handed over to British Aluminium, which is in reality the Reynolds Corporation of America. The magnificent deposits at Weipa contain probably more than 2,000,000,000 tons of raw ore. This was mentioned by a South Australian senator previously. When it is realized how relatively small an amount of the ore from those deposits will go to the aluminium industry in Australia, Queensland senators on the Government side should be ashamed. We find that there is to be handed to Consolidated Zinc and the Kaiser Corporation the magnificent deposits at Weipa. They were sold out by the Nicklin Government - following, I admit, preliminary negotiations by the Gair Government. They affix their signature, selling for a royalty of 6d. a ton. We are told that this will lead to the development of a town of 6,000 people on the west coast of Cape York Peninsula. Probably millions of pounds worth of material will be taken from that area, and after the area has been worked out it will become another desert. Commercial interests pay no regard to the rights of the people or of the nation.
– That country will be good agricultural land after they take the top off it.
– I hope that it will be better than the Bulolo valley after the gold was taken out.
– Only stones were left in the Bulolo valley.
– The Bulolo valley was a fertile area before they took out the gold.
– That was under a Labour administration.
– No it was not. However, this argument does not concern the agreement before the Senate. I am sorry to have digressed. Honorable senators opposite like to lead me off the track and on to subjects about which they know very little. I accept the responsibility of educating them.
– Do you know anything about gold-mining?
– Yes. I know something about the Bulolo valley and also about bauxite. Remember that!
Several parties have been involved in this undertaking at Bell Bay. There have been the Tasmanian Government, the Commonwealth Government, Consolidated Zinc, the Australian Aluminium Production Commission, and now the Aluminium Production Corporation Limited. I am accepting Senator Spooner’s statement in this regard, and I think he would know more about this business than Senator Scott, who is interjecting. The new company, the Aluminium Production Corporation Limited, involves Consolidated Zinc, the Tasmanian Government, and the Kaiser corporation of America - previously behind the scenes, but now out in the open.
Why do we object to this agreement? It is not because we are opposed to the development of the industry in Tasmania. We believe that Tasmania, because of the financial responsibilities that she has accepted in the past, is entitled to every consideration. That is why we seek to protect the rights of Tasmania under this agreement. Successive federal governments since 10th December, 1949, have betrayed Australia, and particularly Tasmania. The Commonwealth stood over Tasmania when the agreement was altered1 in 1952. The Commonwealth threatened to sell out to private enterprise, but it could not find a buyer at that time. When the Commonwealth found a buyer it concluded negotiations very quickly and very secretly. Anybody with a sense of national responsibility, anybody who recognizes the rights of the people to develop their natural assets, must oppose the sale of this undertaking.
– Will you vote against the bill?
– In the process of time Senator Spooner will learn what we propose to do with his agreement.
– If you do not intend to vote against the bill, why all the fuss?
– We want to tell i he people of Australia what the Government is doing, what its predecessors did. and what this Government proposes to do in the future if it is game. We remember what the Government would have done with Trans-Australia Airlines but, because of the outcry at the time, it was not game to go ahead with its proposals. The Government was not game to sell T.A.A. because so many people had had dealings with the organization and knew how wonderful it was. But very few people are aware of what goes on in the aluminium industry, and the Government thinks that it can get away with ‘the sale of this undertaking just as it got away with its sale of Commonwealth Oil Refineries Limited, Amalgamated Wireless (Australasia) Limited, the whaling interests and the Commonwealth Engineering Company Limited. The Government’s record is a tragic one for Australia.
– I do not think you are game to vote against the bill.
– The Minister knows that I have unparalleled courage, and that I act in accordance with the dictates of my conscience. When the time comes I hope that some of the Minister’s associates on the other side of the chamber will have similar courage and will vote in accordance with their convictions. We then may see something that will not be altogether to the Minister’s liking.
We on this side of the chamber bear no animosity towards New Zealand. We heard some reference this afternoon to the possibility of New Zealand becoming a seventh State of the Commonwealth. That proposal was mooted some years ago, but apparently there was too much water between Australia and New Zealand. In recent years, the Government has claimed credit for so many things that it is a wonder it has not been able to reduce the distance between New Zealand and Australia and help to make New Zealand a seventh State of the Commonwealth.
Under the agreement, the sum of £160,000,000 is to be spent in New Zealand to exploit our raw material. Senator Kendall is a loyal Queenslander, and I hope that he will stand up for Queensland’s interests in this matter. 1 have always admired his courage, and 1 hope that he does not fail me on this occasion. What will Queensland get out of this agreement? All that Queensland will be called upon to do is to convert the raw bauxite into alumina. Why? Will it be a help to Queensland? No, it is to be done to lessen the cost of freight to New Zealand. What will happen, to the magnificent Blair Athol coal deposits, which are possibly the best in the world?
– The best in the world?
– That is right.
– Senator Vincent may take Senator Kendall’s word that the Blair Athol deposits are the best in the world. Senator Kendall knows what he is talking about. The Nicklin Government of Queensland has made no real attempt to meet the cost of erecting an aluminium smelter in Queensland. Queensland will not have a smelter, which is essential for the manufacture of aluminium. Queensland will be denied this right, just as in the process of time the Northern Territory will be denied certain rights.
The terms of sale are most unusual. The new company is to be allowed sixteen years to pay. There may have been some sympathy on this side with such a poor firm as Consolidated Zinc, but when you think of that firm’s association with the Kaiser corporation and with- other organizations, what a farce it is to give this new company time to pay! It is a pity the Government did not apply the terms of this agreement to the poor unfortunate people of Australia. When they have to buy the essentials of life, they are forced to buy through hire purchase. Only recently the Government announced that the maximum rate of interest on money lent by banks is to be 7 per cent., with an average of 6 per cent. The smaller people will have to pay 7 per cent, whilst the bigger people pay only 5 per cent, in order to maintain the, average of 6 per cent, at which the Government aims. A further concession granted to Consolidated Zinc Proprietary Limited is that it will not pay any interest until it earns 6£ per cent, on its investment after allowing for taxation. For the first four or five years, and possibly for a longer period, no interest payments will be made, because in the initial stages many difficulties will have to be faced and overcome. As the result of its lack of business acumen the Government is denying the Australian people the benefit of millions of pounds. Further, when the term of the agreement expires the obligation to pay interest is discharged. Who would not buy on such terms?
However, the ground on which the Government really stands condemned in the eyes of the public is the fact that it made no attempt to obtain competitive bids. I am not saying that a better bid could have been obtained. I am not in a position to say that; but at least the Government could have tried. It ill becomes me to say that this was a hole-and-corner arrangement, but I must admit that it smacks of such an an arrangement. It seems the Government was determined to sell to the first bidder. In order to maintain the prestige of the Government the sale of this industry should have been advertised throughout the world. If the Government believes in competitive capitalism and the principle of supply and demand, why did it not follow its basic philosophy on this occasion? Why did it not ascertain whether the Reynolds Corporation or the Canadian Aluminium Company was interested?
We have been told that because of some technical advice given by the British Aluminium Company during the time of the Chifley Government, the present Government was under an obligation to offer the aluminium industry to that company. Where is the British Aluminium Company to-day? That was the company the Government sheltered behind in the first place; but it does not exist to-day. The Government has in effect sold out to Consolidated Zinc Proprietary Limited and the Kaiser Corporation. It is useless for the Government to shelter behind the Tasmanian Government as it has done in the past. The Tasmanian Government is acting from economic necessity. Naturally a Labour Government, in the interests of its State and its people, will seek the expansion of an industrial activity. In this case it was actuated by economic necessity. The Commonwealth informed the State of Tasmania that it would provide no more money for the undertaking. The attitude of the Tasmanian Government was that if the Commonwealth could not provide the money at least the Commonwealth should remain in the industry and introduce a third partner. Nothing would have been wrong if that had been done. Was it impossible to get anyone else to come in? Consolidated Zinc Corporation Limited and probably many other organizations might have been prepared to come in on that basis if reasonable terms advantageous to them, had been offered. On occasions there is a measure of dog eat dog among these large organizations. If one can get in first it will do so. Although honorable senators opposite have greater business acumen than we on this side possess, at no time did they make any endeavour to sell this asset at its best marketable value, nor did they make any endeavour to preserve it as the people’s asset. That is why they stand condemned before the people of Australia.
This agreement has been entered into in such a way that when the time comes for the people of Australia to vent their ill will on the Government, this industry will be so tied up with overseas investors and foreign capital that it will be extremely difficult for the Labour Party to unravel the tangle and do a reasonable job in the interests of the people. The people of Australia will be tied further to the dictates of overseas investment and foreign capital. It is useless for Government supporters to say that such a position cannot arise, because it has happened before. In the past, big interests have divided the world into two. That happened in the explosive field. The Nobel and the Du Pont organizations divided the world with the exception of one country. The Nobel organization took Europe, Africa and Australia whilst the Du Pont organization took Asia and the American continent with the exception of Canada. It seems they agreed that Canada should be a competitive field; but they divided the rest of the world between them. The same thing could easily happen in the field of the production of aluminium. If the aluminium organization in the process of time deems that it is uneconomical to carry on production in Australia, regardless of expansion at Bell Bay, it could decide to stop production in this country. Then, instead of having a town of say, 6,000 people, on the west coast of Cape York Peninsula, we could find ourselves with a ghost town. I admit that a lot of exploration work would have been carried out involving an expenditure of millions of pounds; but that would be nothing compared with the hundreds of millions of pounds involved in this industry throughout the world.
– You do not really believe this story yourself, do you?
– I would not be putting it forward unless I did.
– Do you suggest that an organization would spend £125,000,000 on a prospect and then walk away from it?
– Do you think that has not been done before?
– I have never done it.
– If one of these huge organizations saw the opportunity to make a profit of hundreds of millions elsewhere, do you think it would worry about an uneconomic prospect in which it had spent £125,000,000? Of course, it would not. The same loyalty to this country as that which characterized Julius Kruttschnitt and George Fisher at Mr. Isa has not been manifest in this instance. They utilized the natural products of this country and established a refinery at Townsville. That area has experienced a boom because of the subsidiary industries, associated with the copper industry that have been developed in the area. Even if Consolidated Zinc Proprietary Limited observes the agreement and increases the production of Bell Bay to 28,000 tons, what will be the position? The Government talks glibly of a production of 40,000 or 50,000 tons, but there is no obligation on the company to achieve that production at all. The Government, as in the past, has again sold out the interests of Australia; and it will continue to do so if it be permitted. We hope that in the interests of the nation the wisdom of the people will prevail next year and that they will see that the Government which has been in power since 10th December, 1949, will finish its term of office in 1961. In the meantime I hope the Government does not make such a mess of things that it will be impossible for a Labour Government to save something worthwhile from the mess it has created.
Sitting suspended from 5.45 to 8 p.m.
.- In supporting this bill to approve the agreement for the sale of the Australian Aluminium Production Commission’s establishment at Bell Bay, Tasmania, I want to say that it is my considered opinion that this move is very popular with the people of Tasmania, whose industrial growth will be thereby greatly assisted. Since the sale was negotiated, I have not heard one word of criticism from Tasmanians about, the Government’s action in selling the. Commonwealth’s share in the undertaking to- allow for increased production. As a fellow Tasmanian, I was amazed to hear Senator McKenna say last night, as reported on page 1823 of “ Hansard “-
As I find my time running out, 1 conclude by saying that we oppose the bill. We think that the transaction is unwise, irregular and un-Australian.
From the debate this afternoon it was difficult to find out. which way the Labour Party really was going. Senator O’Byrne seemed to be wavering. He criticized the bill but appeared to feel that he would be supporting it although he did not like it. I presume that the Labour Party will, as usual play the game of follow the leader and will oppose the bill, as Senator McKenna said it would.
Since 1944, when the idea of starting an aluminium production industry in Tasmania was first conceived, the matter has been a political football. Members of the Labour Party, in both State and Federal spheres, have made constant allegations about the Australian Aluminium Production Commission. They have asked constantly whether or not the undertaking would be sold, and whether or not it would be developed. In my view, this has done quite a lot of harm. 1 remember during my seven years in the Senate a debate on the subject on a motion for the adjournment of the Senate, initiated by the Labour Party, and questions implying that all sort of things were wrong at Bell Bay. Then there was an inquiry by the Public Accounts Committee into the undertaking. When the Minister for National Development (Senator Spooner) recently announced details of the sale of the Commonwealth’s share in the undertaking, there was another debate, and all sorts of allegations were made by the Labour Party. It is peculiar that Labour members of the Commonwealth Parliament have been so critical, so vocal and so damaging, when their colleagues in the Tasmanian Government are partners in the desire to develop and expand production at Bell Bay. I feel sorry for the Labour Premier of Tasmania and his supporters, because every time the boys on the Opposition benches here open their mouths they cause him embarrassment. He wishes that they would keep quiet.
As soon as this bill receives the royal assent, aluminium production will be taken out of the political football field, which will be a good thing for the industry and for Tasmania. During debates, including this one. there have been allegations, always made by Labour, of underhand deals. A member of the Tasmanian Parliament took up this matter and voiced what had been said in this chamber some few weeks ago. Let me read what the Tasmanian Premier, Mr. Reece said as reported in the “ Hobart Mercury “ a week or two ago. Unfortunately, I have not the dateline. He said -
Any inference that there had been sharp practice or any underhand business in the sale of the aluminium works at Bell Bay was completely unfounded.
So the Labour Premier, who has been in all the negotiations that have been brought successfully to an end, refutes the allegations that his colleagues in the federal sphere continue to make recklessly and wrongly.
What does the history of this industry in Tasmania reveal? As I said, the idea was conceived in 1944, primarily, I believe, to try to make the electorate of Bass safe for Labour. There was a war on at that time, and one could not altogether blame the Labour Government of the Commonwealth if it did not make much headway. But it made no headway and it was not until the glorious date referred to by Senator Dittmer - 10th December, 1949 - when the Menzies-Fadden Government came into office, that progress began to be made in establishing the industry at Bell Bay. Labour did nothing, but the Liberal Government got the project under way.
The main criticism of the agreement by such doctrinaire socialists as Senator O’Byrne and Senator Dittmer is that we have sold the people’s interests. But the people do not think that is wrong. They do not think that we did any harm by selling the Commonwealth’s interest in Commonwealth Oil Refineries Limited to BP Australia Limited, because they know that once the restraining hand of government is removed an industry can develop and1 be conducted efficiently for the benefit of Australia. The people are quite happy about the fact that the £11,000,000 that the Commonwealth will receive from the sale of the Bell Bay undertaking will be used for something else, whereas, invested in Bell Bay, it is earning about 1£ per cent, per annum. The people do not like such a low return. They want more for their taxes than H per cent. I believe therefore, that the Labour criticism is invalid.
The Commonwealth Government and the State Government realized that there was a need for expansion. Production was not profitable, and an expansion from 12,000 tons a year to at least 16,000 tons was essential if the industry were to be a paying proposition, so the negotiations were commenced. We were not producing in Australia enough aluminium for our own requirements, and imports of aluminium were costing us £6.000.000 a year, which was a heavy drain on our overseas funds. When this bill becomes law and Aluminium Production Corporation Limited, in which the Tasmanian Government will hold one-third of the shares, gets going, production will be increased to 28,000 tons per annum. I believe that the Premier of Tasmania is hopeful that production will ultimately be increased to 40,000 tons. The aim is, first, to meet Australia’s ever-growing demand for aluminium, and secondly, to produce enough to export at prices which will be competitive with those of other countries. No Australian can be critical of that policy, which is aimed at providing us with the aluminium we want and allowing us to export. Senator Wright this afternoon emphasized the need to increase our exports. Other benefits will accrue to Australia, and particularly to Tasmania, as a result of the expansion of the Bell Bay works. First, we will use Australian bauxite instead of having to import bauxite. That alone will save us money. Secondly, we will use Australian coastal shipping, which will be of benefit to Australian waterside workers and members of the Seamen’s Union. Anything that we do to develop Australia and create employment is of benefit to the country. In spite of that, the Labour Party says “ Do not do that. We oppose it.”
For Tasmania, the expansion of this industry will be another step forward in. what, over the last ten years, has been a wonderful development of our industrial strength. The expansion of this industry will make a great difference to northern Tasmania. It has seemed to me within the last three or four years that some form of restraint was being placed on the development of northern Tasmania, but now, as a result of this action by the Commonwealth Government, with the concurrence of the State Labour Government, great development will take place. The Broken Hill Proprietary Company Limited proposes to spend approximately £5,000,000 nearby, and not far distant but towards the north-west a paper pulp mill is to be established. The negotiations that, have been, completed and which will be given the effect of law when this bill is passed will have given a great fillip to Tasmania’s industrial growth, employment and security.
Some time ago when we debated a statement by the Minister for National Development about the future of the aluminium industry, members of the Labour Party asked: What are we going to do about the staff and superannuation rights? 1 remind the Opposition that this Government cares for the welfare of employees just as effectively and sincerely as does any other political party. Opposition senators often imply that we are careless about the welfare of employees. I remind honorable senators opposite of the following passage in the Minister’s second-reading speech: -
A very important part of the agreement is the provisions it contains to protect the employment, superannuation, leave and furlough benefits of the employees of the commission.
The Opposition’s criticism in that regard is answered. I am certain that the employees of the commission are very happy about the development of this industry.
The commission, with the aim of ensuring industrial peace, entered into agreements with two of the principal unions associated with the industry. The Minister, in his second-reading speech, referred to that matter and said -
An industrial agreement was made in 1959 between the Amalgamated Engineering Union and other unions and the commission. The sale agreement obliges the company to continue to observe this industrial agreement as if it were a party to it in place of the commission.
The fact that this Government has ensured that industrial agreements made with the unions affected will be honoured by the new partners in this undertaking refutes the Labour Party’s criticism.
We have had a fairly long debate on this bill, and I do not propose to go over the ground that has already been traversed. Before concluding my speech, I should like to support the Minister for National Development in the well deserved tribute he paid to those who have been in charge of the activities of the commission in recent years. They have been very efficient and have done a wonderful job. Moreover, they had a loyal band of workers under their control. I believe that the passing of this legislation and the taking over of this undertaking will ensure a bright future for the Australian aluminium industry and will give a great fillip to the industrial strength of northern Tasmania. I have pleasure in supporting the measure. I shall be amazed if any Tasmanian on the Opposition benches opposes it when the vote is taken.
.- I move -
At end of motion add “ but the Senate, whilst welcoming proposals to expand the Australian aluminium industry, condemns the Commonwealth Government for handing over to foreign interests the development of bauxite deposits and the production of aluminium which are vital to Australia’s economy and defence “.
– I second the motion.
– Senator Marriott said that in his opinion the original decision to establish the aluminium industry in Australia was made for the purpose of saving the seat of Bass for Labour. Senator Marriott was not a member of the Senate when the establishment of this industry was considered in 1944. Those honorable senators present to-night who were here on that occasion will remember the discussions which took place.
It is true, as was stated by the Minister for National Development (Senator Spooner) in his second-reading speech, that the establishment of the industry arose out of war-time conditions. It was thought to be essential that, in the interests of Australia’s defence, an aluminium industry should be established in this country. Those of us who were members of the Parliament at that time, have a lively recollection of the discussions which took place and of the fact that this island continent of Australia, which was engaged in war, was dependent upon other countries for its supplies of aluminium. We knew there was a certain amount of bauxite in Australia, but we were not then aware of the vast deposits which have since been discovered. We believed that the establishment of this industry was so essential that we were prepared to proceed with it with the deposits then available to us.
I know of no other country, especially an island country like Australia, which would dispose of one of its greatest assets to interests over which it had no control. Of course, when we recall the actions of this Government since it assumed office, what it is now doing does not seem strange. This industry in Tasmania is the child of Labour, in both the Federal and State spheres. We, as a national government, having in mind what was necessary to maintain the country’s economy and to meet vital needs in time of war, established various industries. What has been the fate of those industries since this Government has been in office? The agreement that we are being asked to ratify to-night is only one of a long sequence of agreements entered into by this Government for the disposal of undertakings which the Australian Labour Party believed to be of great importance to Australia. Slowly, but surely, one great instrumentality after another - instrumentalities that were established by the Labour Party during the war period - has been transferred to other hands. 1 ask honorable senators to turn their minds to the history of nations that are rich in raw materials. Can any honorable senator think of one other country that has disposed of essential resources by letting them fall into foreign hands, as Australia is doing under this Government? Where would the United Kingdom be to-day if British statesmen of the past had sold that country’s great deposits of iron ore and coal? Would the British nation have reached its present world position if its governments had applied a policy similar to that of the present Australian Government? Certainly not! When the Labour Government established the Australian aluminium industry in 1944, it visualized the part that the industry could play in the development of Australia. The Government of that day expected that Australia would conserve for itself the natural resources that are to hand. When uranium was discovered in this country, I for one thought that the discovery would make for the development of Australia. But have we set to work to develop our uranium deposits? On the contrary, we are playing a very minor part in their development. We are simply mining the raw material and shipping it overseas. There has been no significant development of the deposits.
If we had in Australia a national government that was worthy of the name, it would ensure that our vast deposits of bauxite were used to the best advantage. Instead, the Government is disposing of them to foreign interests. A Commonwealth Labour government established the aluminium industry at Bell Bay, with the assistance of the Tasmanian Government, because of the availability of hydro-electric power, but the availability of hydroelectricity elsewhere has been advanced tonight as one of the reasons why we should dispose of our wonderful bauxite deposits. The attitude of the Tasmanian Government is being cited by the Commonwealth Government to justify the policy, which it has adopted ever since it has been in office - the policy of getting rid of national assets by handing them over to private enterprise. lt would not be so bad, Mr. Deputy President, if the Government had offered these rich deposits of bauxite to Australian capitalists or financiers. Government supporters have said - and I believe them - that a great deal of money is needed to manufacture aluminium. But what steps has the Government taken to obtain the necessary capital in Australia? Apparently, the Government is afraid of the state of prosperity that exists here. There is so much money available for the purchase of commodities and for investment that the Government has become afraid, and is seeking by devious means - all of them ineffective - to control the prosperity. There are frequent take-overs of industrial organizations, involving the payment of millions of pounds. Why did not the Government approach Australian organizations and tell them of the great advantages that would accrue from the investment of Australian capital in the aluminium industry. Silently, and under the pretext of saving the Bell Bay works, the Government went abroad and approached only one company. There was no world-wide competition for our magnificent bauxite deposits. The Government selected one company and negotiated with it.
The Bell Bay aluminium works are located in a State that is not over-financial, a State with a small population. But despite its small population and its comparative lack of wealth, Tasmania has made wonderful progress in the development of hydroelectricity and in other fields. As I have said, the availability of hydro-electric power in that State was one of the inducements that led this Parliament and the government of the day to establish the aluminium industry at Bell Bay. Because we knew that a small State such as Tasmania would not be able by itself to undertake the development of such an industry, the Commonwealth agreed to play a major part. But the present Commonwealth Government, the holder of the purse strings, which taxes the people of Tasmania and then lends them their own money at interest, has jibbed. It has said, “ We will put no more money into the development of this industry “.
Let me refer to a statement of the Minister for National Development when he was concluding his second-reading speech with, as he said, a few general observations. He said -
The original purpose of the commission - the establishment of the aluminium industry - has been achieved. Like most pioneering ventures, it has not been an easy task. To-day we have a well-run organization producing over 12,000 tons of metal each year, which this bill authorizes the Government to sell. In closing this chapter in the history of the aluminium industry, I express, on behalf of the Government, appreciation of the work of the commission and in particular the part played by Mr. N. K. S. Brodribb, C.B.E., the chairman.
Those are the final words of the Minister in regard to this industry. Mr. Deputy President, one would have thought that if the feeling of the Government was that there had been established in Australia an industry capable of doing those things after its time of trial and tribulation, this Government, having control of the purse, having the interests of Australia at heart, and realizing the vital part that aluminium plays not only in war-time but also in peace-time, would have been providing money to develop Australia’s natural resources. But what has happened? We know the very important part that aluminium played in the production of aircraft in Australia. The Labour Government, anxious for the development of Australia and for Australia to be self-contained, set up an aircraft production industry. It would have gone further with that industry. It knew that aluminium was one of the vital metals required. But where is the Australian aircraft industry to-day? It has gone, and we are running all over the world now to see whether we can buy aircraft from foreign countries which have the power to say, in a time of trouble, “ We have no more aircraft for Australia “. Australia is not self-contained. Honorable senators may go where they like to see whether the natural resources of Australia are being developed by the Government.
The Labour Government established a factory at Wangaratta for the fabrication of aluminium; tout to-day it is out of commission. It is being utilized for other purposes. Despite those facts, the Minister states that Australia has to import aluminium costing £6,000,000. Or was it £60,000,000?
– It makes no difference.
– It does not make a bit of difference to the Government. Aluminium has to be imported into Australia in order to provide for our national requirements. Why is the Bell Bay undertaking being sold? So very adroitly and so very silently has all this work been performed that only at the last minute do we find out that the great Kaiser Aluminium and Chemical Corporation is right behind all the moves. Is it only since the making of this agreement that this overseas company, this giant, has suddenly become interested in the Bell Bay works or the aluminium resources of Australia? Certainly not. Cannot honorable senators see the plan that has been developing all the time for the purchase of this Australian industry? This information came forward in the way it was presented by the Minister in introducing this bill.
Under the guise of fostering or maintaining this industry in Tasmania, the Minister even admitted in his second-reading speech that it may not be possible for this plant to be developed economically. The company which is buying it intends to do certain things if they are economically possible. Who is to decide whether it is economically possible to transport bauxite or alumina from north Queensland to Tasmania? In the agreement that has been signed by the Government on behalf of the Australian people, is there any guarantee that this industry will continue for one minute longer than the purchasing company cares to operate it? No such guarantee is to be found anywhere. Therefore, not only are foreign interests using our raw materials, but they will also determine for how long aluminium will be produced in the island State of Tasmania. That is the position in which this country is to-night; the position into which it has been forced as a result of this agreement made by the Government.
Is it any wonder that honorable senators on this side of the Senate, who had the responsibility of conducting a war and of picking Australia up almost from destruction and leading it through, are apprehensive of what is happening under this agreement? We have been through that. And who knows what the future requirements of this country will be and what will happen when we go to look for this metal which, it is believed, might eliminate steel from the great uses to which steel is being applied to-day? Australia’s secondary industries are being developed. We take pride in the development of the iron ore industry. Those of us who were in the Senate at the time will recall the very strong pressure that was exerted for the purpose of giving the Japanese the right to exploit iron ore deposits in Australia. That problem is again raising its head. Instead of Australia’s great deposits of this metal, which it is suggested might even displace steel in manufacturing industries in the future, being retained for the benefit of Australia, they are being given out of our hands for a few million pounds on terms which any company would be pleased to accept. We will have no control over those deposits. The company is supposed to pay interest, but with the “ ifs “ and “ buts “ and the conditions which must exist before the company will pay interest, I am afraid this sale will be like the sale of ships which was made by a previous Australian government.
– A Liberal government.
– Yes, a Liberal government. The ships that were sold had played a great part for Australia, but Australia was never paid for them. The same situation is likely to arise in respect of this great aluminium industry, with its great potential. Therefore, I have pleasure in moving the amendment. I hope the Senate will carry it.
– I rise to support the bill before the Senate. I certainly oppose the amendment moved by Senator Sheehan. I welcome the opportunity to pay a tribute to the Leader of the Government in the Senate (Senator Spooner), in his capacity of Minister for National Development, for concluding such a satisfactory agreement for the sale of the
Bell Bay aluminium undertaking to Consolidated Zinc Proprietary Limited. This bill marks the conclusion of a very satisfactory deal. I assume that the money will be paid over on 1st February but that the company will get delivery of the assets on 1st January next. Not only has the deal been negotiated very satisfactorily, but it has been wound up very promptly. I congratulate the Minister for National Development (Senator Spooner) on the very satisfactory arrangements he has made, not only for the sale of the Bell Bay aluminium undertaking, but also for the carrying on of the undertaking by a company which has the necessary capital to develop it as well as the know-how and the efficient organization required to make the most of it. 1 should like to tell Senator Sheehan that the public of Tasmania and the Government of that State are fully in accord with the sale of the Bell Bay aluminium undertaking to the corporation. They are very pleased indeed at the prospect of the benefits that will certainly accrue to Tasmania in the future. If the honorable senator were to visit Bell Bay, he would find that there is great excitement there over this deal. The people realize that Tasmania will benefit in many ways from the investment of overseas capital in the industry. We require in Australia every penny of capital that we can lay our hands on. in order to develop this country.
This evening, members of the Labour Opposition have emphasized that the aluminium industry was established in Australia by a Labour government, but I do not think that if that government had continued in office it would have been able to find the capital necessary to develop and make the most of the industry. The establishment of this industry was first mooted in 1944. and this Government had to face many difficulties in maintaining it from 1949 until the plant was brought into production in. I believe. 1955. The greatest difficulty was experienced in establishing the Bell Bay plant as an efficient enterprise and piloting it through the developmental stages until it was brought to production. In a speech that Senator Spooner delivered in September last, he said that this Government had inherited the project, with all its faults of inefficiency and high capita] costs, and had sold it at a satisfactory price with, 1 would say, a vision splendid as to its future production and development.
Honorable senators have said that we do not use aluminium in Australia to its best advantage. I think that is true. I believe that if aluminium were available to industry in Australia in sufficient quantities and at the right price, our use of aluminium would increase by five times, or even ten times, during the next ten years. I read a pamphlet recently which gave figures in relation to the use of aluminium in America, in which the following statements were made: -
General Motors’ new compact car, the Corvair, has an aluminium engine. In fact, the United States auto industry alone is using more aluminium to-day than all American industries used in 1939. In 1940 the average American car contained five pounds of aluminium; the 1960 cars average 59 pounds (the Corvair engine contains 84). Many experts think all cars will eventually have aluminium engines. An aluminium engine may weigh 200 pounds less than its iron counterpart, permitting lighter supporting structures, lighter wheels, brakes, tires - thus greater operating economy.
Aluminium’s biggest new stride can be seen all around us-
The article, of course, referred to America - aluminium homes and aluminium-clad skyscrapers. . . Five years ago 500,000 pounds of aluminium was considered a big order.
To-day, in America, an order for 3,500,000 lb. is quite a normal order for a proposition in the building line. In the building of a new Air Force academy at Colorado Springs, I believe that 5,000,000 lb. of aluminium was used. As I see it, the aluminium industry in Tasmania can be and will be one of the best industries established in Australia.
As I have said before, the aluminium industry was established in Tasmania in 1944 by a Labour government, and its sale was prohibited unless permission were granted by the Commonwealth Government and the Tasmanian Government. I believe that this provision was altered in 1952, when a further arrangement was entered into by which the Commonwealth Government had the right to sell the aluminium industry without reference to Tasmania. That is what has happened in this case. The Commonwealth Government is acting within its rights in selling this industry to overseas interests, and it is, ofcourse, under an obligation^ to return to Tasmania the amount of £1,500,000 that was invested in the industry by the Tasmanian Government. The Commonwealth Government itself invested £9,700,000 in the industry, and this amount will be refunded to the Government over a term of sixteen years.
As we know, the Bell Bay undertaking is now producing 12,000 tons of aluminium a year. This is only one-third of the quantity of aluminium that is required to supply the present needs of Australia, but we will probably use up to 36,000 or 40,000 tons a year within the next five years. As. the years go on, our use of aluminium will probably increase until we are using 100,000 tons a year.
The Consolidated Zinc organization has taken over two-thirds of this proposition, and the Tasmanian Government one-third. I think that this is quite a happy solution, as far as Tasmania is concerned, because that State now knows very well that it will not be called on to supply the capital needed to develop this very important industry. The Labour Opposition has sard that we are handing over the industry to foreign interests, but we are retaining a very big share of it, because 12 per cent, of the shares in the company are held by Australian shareholders. Furthermore, in the future taxation will be levied on its profits. In addition, of course, the employment and the defence aspects are very important.
From what honorable senators opposite have said, it would appear that they think it likely that the industry will be lost to Australia. It is situated in Australia, and I could not imagine it being transferred to any foreign country. I cannot follow honorable senators opposite when they say that the industry will be lost to Australia. Tasmania will supply all of the electric power that is needed by the project now and which will be required when it develops in the future. Tasmania is very fortunate in having ample power available for a project of this size, and for other projects that we hope to see established there.
– Thanks to a Labour government.
– Probably so. Mr. Reece, the Premier of Tasmania, is very much in favour of the proposal contained in the. agreement that is now before the Senate. He can see into the future, and he knows that the aluminium industry in Tasmania will develop and that other industries will be attracted to the island. The Broken Hill Proprietary Company Limited is already established not far from Bell Bay.
The arrangement that has been entered into for the sale of this plant is a matter for congratulation by all parties concerned. We Tasmanians are pleased that the Bell Bay undertaking has been handed over to a company that is in a position to develop the industry. The establishment of the industry at Bell Bay has led to great activity in the building of roads, houses and other amenities in and around George Town. The business community of George Town expects great activity in the future as the aluminium industry is developed.
I regard the transaction as a plain business proposition. I do not think that the Government could have ignored the opportunity in any circumstances. It would have been impossible for the Commonwealth or Tasmania to develop this industry as it should be developed, having regard to the capital required and the knowledge necessary to- place the industry on a sound production basis. Without adequate production the industry cannot prosper. Aluminium cannot be produced at a reasonable price unless there is a large turnover.
There has been a good deal of criticism of this transaction from the Opposition, but at no time has there been any secrecy about the Government’s intention to sell the project. All honorable senators know that part of this Government’s policy is the promotion of private enterprise. The Bel Bay aluminium undertaking is a case in point, where the Government has said that it is not prepared to put more money into the industry and that the industry can be developed only by private enterprise. The proceedings have not been shrouded in secrecy. We knew that the negotiations were going on, and we knew that there would, be nothing to hide in the final agreement..
The only matter to be decided is how long the’ Government should retain undertakings such as the one we are discussing before handing, them over to private enterprise. There is no- reason why such undertakings should, not be established by the Government, but there comes a time when they should be handed over to private enterprise for further development. That is a good policy, and it has been accepted by the people at the last five elections. The electors understand the policy. They realize that it has been responsible for the tremendous development of Australia during this Government’s occupation of the treasury bench over the last eleven years. The Government is particularly happy with this transaction. The set-up and future prospects of the new company that is to take over Bell Bay are particularly rosy. There is nothing to prevent the industry from developing into one of the soundest of those that have been established in the Commonwealth in recent years. I have very great pleasure in opposing the amendment and supporting the bill.
– I rise to support the amendment that has been moved by Senator Sheehan. I take the opportunity once more to place on record the views of the Opposition, first with regard to the disposal of this plant and, secondly, with regard to the manner of its disposal. The Bell Bay undertaking has been the subject of questions and debate in this chamber and in another place for the best part of two years. We knew that the Government intended to move out of Bell Bay. That is why it did not give the industry a proper opportunity to attainfull economic stature. The Government kept production at an annual figure of 12,500 tons, which all of us knew was a figure that did not allow the industry, no matter how well it might be handled, to become economically strong.
The Government let the world know that it would be. a willing seller of the Bell Bay undertaking. If the Government, being a willing seller, had approached all organizations in the world that might have been interested in taking over the Commonwealth’s share of this plant, one of our strongest arguments would have been silenced. But the Government sold this plant in- utter secrecy, and refused even to invite offers from anybody other than the particular people with whom it was deal ing. With whom was the Government dealing? It was dealing with British Aluminium, because it said that it was under an obligation, inherited from the last Labour Government led by Mr. Chifley, to give British Aluminium the right of first refusal if this plant ever was sold. Standing in this chamber, the Leader of the Government in the Senate (Senator Spooner) and his colleagues have said in effect that because they are honorable men they intend to honour the Government’s obligation. But almost overnight British Aluminium had joined forces with the Zinc Corporation, which is an English company with approximately 12 per cent. Australian capital. Shortly thereafter the make-up of British Aluminium changed. Its ownership changed. Instead of being a British-owned company, it came under the control of Reynolds Metals of America - one of the four great aluminium masters of the world. Despite this the Government still says that it had an obligation to sell to that company. The name is the same even though the form and substance have changed. The Government has decided to sell to the shadow which has the same name as the substance. So the obligation which was originally a single obligation to British Aluminium Company Limited becomes a joint obligation to British Aluminium Company Limited and Consolidated Zinc Corporation Limited1.
I do not know what happened in this hierarchy of big business and in this world cartel of aluminium. For some reason British Aluminium Company Limited slipped out of the picture and Consolidated Zinc Corporation Limited was left on its own to negotiate for the purchase of Bell Bay; or so we were told1. We were led to believe that Consolidated Zinc Corporation Limited was negotiating on its own; but only in the last few days we have found there was another company lurking around the corner all the time. We find now that we have sold Bell Bay not to Consolidated Zinc Corporation Limited but to a combination of that organization and the Kaiser Aluminium Company which is another of the big four in the aluminium world industry. It is most interesting that the public of Australia had to wait until this point to find out to whom Bell Bay had been sold.
Senator McKenna said that this is a part of a world cut-up of aluminium influences and that the Government in Australia is playing the part of a pawn. It is sad enough for the Government to be a pawn, but in this case it is a willing pawn. It has allowed itself to be used in this tremendous cut-up of the world aluminium industry. Not only has the Government been so kind as to put this combination of the Kaiser Aluminium Company and Consolidated Zinc Corporation Limited in possession of Bell Bay, but it has also handed the great bauxite deposits of inestimable quantity and value to these two organizations. The combination of Consolidated Zinc Corporation Limited and British Aluminium Company Limited, have received rights to the tremendous bauxite deposits at Weipa which, when first surveyed, were stated to contain more bauxite than the rest of the bauxite fields of the world put together.
The people of Australia owned that deposit, but because of some personal squabble between Consolidated Zinc Corporation Limited and British Aluminium Company Limited, or some movement on a high plane that we can only guess at, British Aluminium Company Limited said, in effect, to Consolidated Zinc Corporation Limited that it could bring its new partner into Weipa and that British Aluminium Company Limited would arrange with the Commonwealth Government to consolidate its resources at Gove, the other tremendous reservoir of bauxite in Australia. The Government agreed to all those manoeuvres. It is a tragedy to be a pawn; I do not know how to describe being a willing pawn. The Government has given British Aluminium Company Limited a five years’ lease at Gove under certain conditions. Just what those conditions are we do not know. Let us hope that the Government stands up to its agreement. If British Aluminium Company Limited does not honour its obligations, let us hope that at least its lease will be cancelled promptly and that Australian interests will be able to develop that great field.
Then, of course, a new arrangement has been made with fresh movements of pieces and pawns in this great game. The Kaiser organization has emerged in the same place that heretofore Reynolds Metals and British Aluminium held. In the meantime, Consolidated Zinc Corporation Limited had been negotiating with the New Zealand Government to set up an aluminium industry in that country. Whether Consolidated Zinc Corporation Limited adopted the same shady attitude with the New Zealand Government as it did with the Australian Government, I do not know; but Consolidated Zinc Corporation Limited was the only organization which initially negotiated with the New Zealand Government. However, rumours around this city during the last two or three weeks have been to the effect that when the final arrangements are made in New Zealand, the Kaiser organization will also emerge in that country. I would suggest that so many companies must have been bobbing up in front of the Minister for National Development during his negotiations that at some stage he must have thought he was negotiating with a merry-go-round.
Has anyone worked out the effect of giving the same people the same rights in Australia as they are to have in New Zealand? In New Zealand the organization is to set up an aluminium industry with a capacity of 120,000 tons per annum. We know that Australia at the present time is producing 12,500 tons per annum, and that its total usage of aluminium is 45,000 tons per annum. The total usage of aluminium in New Zealand would be no more than 12,000 to 12,500 tons per annum. The combined organizations of Consolidated Zinc Corporation and the Kaiser Aluminium Company are planning to build a plant which will produce ten times the amount of aluminium consumed locally in New Zealand. Obviously the organizations must contemplate exporting aluminium. The aluminium produced in New Zealand will go to other sources, but the question is: To what sources will it go? The first and obvious source is Australia, because there is no doubt that Australia’s consumption of aluminium is going to rise rapidly. When Australia first started to develop the plant at Bell Bay, if my memory serves me right, the consumption of aluminium in Australia was only 2,000 tons per annum. In the fifteen to sixteen years that have elapsed the consumption of aluminium in Australia has risen to 45,000 tons. I have no doubt that by 1 970 Australia’s usage of aluminium will have risen to 120,000 tons per annum. 1 base that on the annual consumption of aluminium of 20 lb. per head. That is a conservative basis, because in 1957 the United States consumption of aluminium was 22 lb. per head. It can be assumed that within the next ten years Australia will move to a per capita consumption that America has had for the last three years.
When I hear Government supporters talking glibly of the Government on the one hand bringing down a bill directed against restrictive trade practices and monopolies and, on the other hand, setting up in actual fact in front of our eyes a monopoly such as I have described, I wonder whether they know what they are talking about.
– Or mean what they are saying.
– They certainly do not mean what they are saying because this is the position which clearly emerges. New Zealand will export aluminium to this country. That may not be a bad thing; it is a good thing for Australia to have as much trade with New Zealand as it can. But the serious aspect is that for what seems to me to be not a large amount of money we have given the same group complete control of the aluminium industry in Australia. That group has agreed to lift the production of aluminium to 16,000 tons per annum in three or four years and in the following five years to raise it to 28,000 tons per annum. When it does that its obligation to this Government and this country is completely over, and there is no obligation on the organization to maintain a plant to produce another ton of aluminium. Australia’s usage of aluminium which, as I have said, will be 120,000 tons per annum by 1970, could be met by importing from New Zealand and keeping the industry in Australia static. That is, of course, unless somebody breaks through the international aluminium cartel and bases production on the northern coalfields of New South Wales. That is the only future that the aluminium industry has in Australia. We need an organization without the extraordinary ties that exist now between the Australian and New Zealand industries.
The new company which is to take over the Bell Bay undertaking will not be able to confine its activities to the manufacture of metal if it is to receive any great economic reward. The history of aluminium all over the world is that those companies which engage in aluminium production alone are not highly profitable. Eventually, they are forced into the fabrication of aluminium products, which is the most profitable side of the industry. We have in Australia to-day a number of fabricators of aluminium. They are quite independent enterprises, and some of them are completely Australian-owned. The pattern that we have seen in other parts of the world will be seen in Australia. The company at Bell Bay will move into fabrication. It will be the only aluminium producer in Australia and New Zealand. A situation will develop such as we saw develop with the Broken Hill Proprietary Company Limited, which now controls not only all the production of steel, but also 85 per cent, of steel fabrication. Inevitably, that pattern will be followed in the aluminium industry. This Government ha» made it possible.
It would have been all right if the Government had been able to say, “ We made the buyer pay well “. But, after all, what is being paid is, in effect, only peanuts. If the Government had forced a good deal, there might have been some justification for saying that it had done a good job. But it has made a dreadful deal. It did not know whether anybody else would have bid more for this plant, because it would not consider any other approaches. There were approaches. As Senator McKenna said, on the day that the agreement was disclosed, he received a telegram from Melbourne interests saying that they were prepared to buy the Bell Bay undertaking at the price accepted, and that they had the know-how to make it a profitable proposition. But the Government did not know about that, because it closed the doors to any other interested party.
Senator Spooner, with his commercial background as an accountant, has said that he could not have made this deal except behind closed doors. As I have said before in this chamber, it is a fundamental requirement in commerce in Australia, and I should think anywhere else in the world, that if a take-over offer is made and negotiations are proceeding, these facts must be public property, in order that the interests of shareholders may be protected. In this instance the shareholders are the people of Australia, the most important body of shareholders in any organization. Only in the last few days a tremendous take-over bid of £22,000,000 or £23,000,000 was made by Myer Emporium Limited of Melbourne tor Farmer and Company Limited of Sydney. As soon as that offer was made, under stock exchange rules it had to become public property for all the world to see. If somebody else thought that Farmers was worth more than Myers offered, he was able to offer more. But nobody had an opportunity to go to the Government and say, “ I will give you more for the Bell Bay establishment “, because the deal was signed, sealed and delivered behind closed doors. Nobody knew the circumstances or the details until the Government announced a fait occompli, saying, “ This is it, and as far as we are concerned, that is the end of it “. That has been the attitude of the Government for a long time. In the Government’s opinion, what it does it does best, and it does what nobody else can do.
Open negotiation is such a serious matter in commercial life that the Sydney stock exchange even removed from its lists the shares of a prominent company which would not reveal details of a take-over bid that had been refused. Although the company had refused the offer, the Sydney stock exchange took its shares off the lists until the company published the details of the offer. If that practice is all right for a stock exchange, the stronghold and stockade of private enterprise, it is a practice that the Government should follow in its own negotiations. Now everybody is wondering whether or not the Government made the best deal. By no force of argument or persuasion can the Government prove that it made the best deal for the people in the sale of the Bell Bay undertaking. It is all very well for the Minister to say, “We made a good deal “. That may be arguable. He can never say, “ We made the best deal possible “.
The decision to sell the undertaking having been made, who dreamed up the extraordinary arrangement under which Consolidated Zinc Proprietary Limited is to pay? If Senator Spooner were rn private business, it could not have come from his office. I do not know who dreams up these things. It is obvious that such an attractive proposition was put because the Government was eager to sell to Consolidated Zinc. We know that it was eager to sell the undertaking; obviously, it was eager to sell to Consolidated Zinc, but not to others who might be interested in tendering. Now we are told that Consolidated Zinc has a partner called Kaiser.
The scheme for payment of interest is such that the Government must be convinced that interest will never be paid in full. 1 do not know how much of this interest will remain owing when the deal is consummated. Senator McKenna detailed the position to good effect. I shall take it a step further. The Government, in its kindness to Consolidated Zinc, said, “Pay us over sixteen years, but if you cannot return 6i per cent, to your shareholders, do not bother about the interest. We shall only charge you 5 per cent., anyway, although we will raise the bank rate to 7 per cent.” Such terms could not be obtained anywhere else in Australia. The Government is giving the company hirepurchase terms in relation to payment of the purchase price, but it is not charging hire-purchase interest rates. If it were, the interest would be about 20 per cent. The company is to pay 5 per cent, over all those years. However, the Government said to the company, “ We want to be most fair with you. You must pay 6i per cent, to your shareholders after paying tax.” This means that the combination of Consolidated Zinc and Kaiser will have to earn 10 per cent, on capital before paying one penny interest. The amount of capital invested will be £10,000,000. So the new organization will have to make a profit of £1,000,000 before it starts to pay interest. But the Commonwealth made a profit of only £122,000 last year, and £155,000 in the year before that. So it is quite obvious that the new organization will not make a profit of £1,000,000 in the first, the second, the third or even the fourth year while the annual productive capacity of the plant is being expanded to 16,000 tons. On the history of the industry as we know it, it will be a physical impossibility to make a profit of £1,000,000 even when the capacity of the plant is expanded to 16,000 tons per annum.
In a period of four years it is proposed to expand the capacity of the plant to 28,000 tons a year. That will cost an extra £9,000,000. I should say that it is obvious that they will get that sum of £9,000,000 only by adding to their capital, bringing the total capital investment up to £19,000,000. Then they will have to make nearly £2,000,000 before they can pay any interest to the Commonwealth. The Minister, in his second-reading speech, embarked upon a long rigmarole about the intricacies and difficulties of the proposal. It is not intricate at all. On the contrary it is very simple. There simply will not be any interest paid. To my mind, to make a profit of £2,000,000 on the production of 28,000 tons of aluminium is an impossibility. But that is the way in which the Government saw the proposal. Members of the Government wonder why we are being so critical and are not placing upon them the valuation that they place on themselves as businessmen and statesmen.
The action of the Government in disposing of this undertaking in the manner proposed is enough to destroy in the mind of any person the thought that the leaders of this Government are the smart businessmen which they set themselves up to be. If the Commonwealth can make a profit of only £122,000 on the production of 12,500 tons of metal, I cannot see how some one else can make a profit of £2,000,000 on the production of 28,000 tons. But until a profit of £2,000,000 is made, the Commonwealth will receive nothing by way of interest.
I do not wish to develop the matter very much further. One becomes sick at heart when one sees the leaders of this country insist on repeating the mistakes that have been made in this country and other countries in the past. It is admitted that we must allow overseas capital to be invested in this country, but unless we insist upon an Australian content in the investments in these various undertakings, we are only creating difficulties for ourselves. Surely all the economic adjustments and readjustments which the Government has to make from time to time because of its own maladministration provide a lesson for it. This Government seems to have a fetish for financing such undertakings entirely with overseas capital. If, for example, the British Aluminium Company exploits the deposits at Gove and establishes a plant to remove the bauxite from the ground and make it into aluminium-
– That will be done by Reynolds of America.
– If that is done by Reynolds, and the product is exported to the west coast of America, which is the natural market, what will Australia get out of the undertaking? That company is American-owned and it can repatriate its dividends. All Australia will get out of the project will be the establishment of a plant on the north-west coast of the Gulf of Carpentaria which,, depending upon the degree of automation used, will employ 300, 400 or 500 men,. We will just be giving away our birthright instead of using it in the interests of the people of Australia. Senator Sheehan has moved -
That the following words be added to the motion: - “ but the Senate, whilst welcoming proposals to expand the Australian aluminium industry condemns the Commonwealth Government for handing over to foreign interests the development of bauxite deposits and the production of aluminium which are vital to Australia’s economy and defence”.
The Opposition has the greatest pleasure in supporting the amendment. We hope that the realization will seep into the mind of the Government that in disposing of this plant it is not doing the right thing.
– I shall do my best to reply to the various arguments that have been advanced by the Opposition. I shall deal with them one by one. I wish, first, to reply briefly to Senator Armstrong’s statements. Inherent in the remarks of the honorable senator was an acceptance of the belief that the plant at Bell Bay was worth on the market the sum of £11,200,000 which was invested in it. To believe that is simply not to face the realities of the situation. The profit last year was only £122,753 - a return of 1.1 per cent, on the capital invested. I say with respect that it is quite an unsound approach to the matter to speak in terms of what might be the repayments of interest. Nothing is to be gained from the unsound approach that Senator Armstrong adopted. The honorable senator tried only to select certain points for criticism and to decry the benefits of the sale of this plant. I repeat that it is quite unsound to approach the matter in the way in which he approached it. I make the further accusation that Senator Armstrong has enough business acumen to know that he approached the matter unsoundly. 1 do not think I will be able to deal with all the points I want to deal with during the half hour at my disposal. So let me say to Senator Dittmer, who is interjecting, through you, Mr. Deputy President, that I do not want to be distracted. It is not that I do not welcome interjections; but I have many observations to make on the arguments that have been advanced.
I think I can say fairly that the Opposition has offered three main points of criticism. The first is that the Government did not call tenders for the sale of the plant. The second was that the Commonwealth Government had coerced Tasmania into this and earlier transactions; and the third was that the Government should not have linked up with overseas interests in making the transaction. In the course of dealing with those three I shall probably pick up the incidental points that have been mentioned. T start upon the basis that there is no substance in any of those three points of criticism. It is not to be assumed that the normal procedure of calling for tenders was overlooked not only by the Commonwealth Government but also by the Tasmanian Government. We did not discard that method of disposal without due consideration. It is not to be assumed that this offer was the first that was received. There were previous offers, and there was a long series of discussions and negotiations over a very substantial period of time before the final proposition was evolved.
I repeat what I said previously, that those who want to approach this transaction fairly - and I do not include the Opposition in that category - have to remember that in this matter we are dealing with an asset which was, by all commercial standards, quite an unprofitable business, an undertaking requiring the expenditure of vast sums of money before it could be proved whether or not it would be profitable. It has to be remembered that unless we sold or reconstructed the Bell Bay venture in some way, we should have been in the position that the deposits of bauxite in other parts of Australia would have had to be developed by some one or other, and there was every indication that the difficulties we nad been experiencing with this small plant ever since we had been conducting it would be increased1, and perhaps would become insuperable as a result of competition from modern plants elsewhere.
We owned an asset which was increasingly difficult to sell on terms that would be acceptable. We had £11,200,000 invested, and we were earning only 1 per cent, on the capital invested. We were faced with the situation that large capital sums would1 have to be invested in order to prove whether or not the business would be successful in the future. I make the point, Mr. President, that this is not the kind of undertaking that would lend itself to sale by public tender or by auction, lt was only by detailed negotiation that we were able to come to terms. The terms themselves may be unconventional but they are sound terms. They suit us as the vendor, and they also suit the Tasmanian Government. Nobody could have evolved those terms prior to calling tenders.
I put the further view, which I hope is the final view on this aspect, that there was so little prospect of receiving a satisfactory price or a satisfactory offer by the calling of tenders or at public auction, that to have adopted that course would have resulted in no offers being received. As a result we would have had an asset which had depreciated in value because the market had proved that there was no buyer ready to go on with the undertaking. We should have reached the stage where potential buyers thought that it was not a worthwhile proposition. Opposition senators are trying to interject. I know the habits of the members of the Labour Party in the Senate. When they cannot argue reasonably, they howl like a pack of dogs.
– The Minister should be fair.
– Order! The Minister must be heard in silence.
– The Minister should be fair.
– Order! I inform Senator Dittmer that I will be fair, too.
– I know you are fair, Mr. President. You are essentially fair.
– I make the further point that we had a partnership with the Tasmanian Government.
– We are not going to be put off by any one.
– The honorable senator will have his chance to speak at the committee stage. He should keep away from the dead past for a while and let me make my speech.
– You should not call us dogs.
– You have no dignity and no sense of fairness in debates in the Parliament.
– Abuse is no argument.
– The abuse is coming from your side.
– That is not so at all.
– As I have said, we had a partnership with the Tasmanian Government. Each government was under an obligation to bring the transaction before its parliament. That fact removes the suggestion that there was an atmosphere of secrecy or privacy about the transaction. Throughout all the negotiations - and this is a telling reply to the suggestion that we coerced the Tasmanian Government - we kept in close touch with the Tasmanian Government. I think it is not unimportant to say that the Tasmanian Premier has gone on record as stating that he is satisfied with the terms and conditions of the sale.
– He had no alternative.
– He was consulted at every turn. He is pleased with the way in which he was treated. Indeed, Mr. President, I am under some indebtedness to the Tasmanian Government, because one of its senior officers played quite an important part in the conclusion of the negotiations in London.
It will be appreciated that although it was our primary responsibility to obtain the good price that we in fact obtained-
– By selling a national asset.
– We had a responsibility to obtain a good price for the works, but there were other great national considerations involved. We knew that we had large bauxite deposits, and that it was imperative to lay the foundations for the development of those deposits. Bell Bay had a large share of the metal market. It provided a good foundation for development of the bauxite deposits by whoever purchased the works. When honorable senators opposite criticize the sale of Bell Bay works and the price for which they have been sold, they fail to remember that the development of the bauxite resources must be undertaken on a large scale. The development of the resources by a large plant would result in alumina becoming available instead of bauxite, and as a result, the alumina plant at Bell Bay would be imperilled. What is the virtue of an alumina plant at Bell Bay if you can buy alumina from the bauxite fields at a lower price than it can be produced at Bell Bay?
The alumina plant at Bell Bay cost £3,300,000, with a written-down value of £2,900,000. I point out, too, that if we are to develop the bauxite deposits, not only at Weipa but elsewhere, that can be done adequately only if there is the foundation for an international industry. If we came to the conclusion that the bauxite should be used only by a protected industry in Australia, we would only scratch the surface of the bauxite resources that we have. One of our early views was that if we were to achieve adequate development of Australian resources, we needed an international industry. We did not want a small protected industry in Australia, because such an industry would never let us fully realize the assets that we have available to us.
– You promised tariff protection if they were in difficulty.
– Order! I will name the honorable senator if he continues to interject.
– You promised tariff protection if they were in difficulty.
– Order! I name Senator Dittmer for interference with the proceedings of the Senate.
– As you know, Mr. President, it is traditional in these circumstances to give an honorable senator who is named an opportunity to apologize. I formally ask that you give Senator Dittmer such an opportunity.
– I am sorry, Mr. President, but I was so incensed on this question that I wanted to express my opinion. I apologize.
– That is a qualified apology; I do not accept it.
– If you tell me how I should apologize, I will be happy to do so.
– Stand up, and apologize; that is all I want.
– I apologize.
– Order! I assure any honorable senator who looks for trouble that he will get it. I intend to maintain order. The Minister is entitled to be heard in silence; and he will be heard without interruption.
– There is another important consideration in the sale of this undertaking and the development of these great Australian resources. Those two things run hand in hand. It was vital that we should deal with a company which had a good record in Australian development and by its past record had proved that it was Australian-minded and had done things in Australia. Mr. President, that is the record of Consolidated Zinc, the company which has taken the leading part in these negotiations. It has great interests at Broken Hill, in the Newcastle area and on the south :coast. These very deposits of bauxite were discovered by the company when it was making a contribution to the search for oil in Australia. That was evidenced during the discussions which I had on this matter in London.
During the negotiations I was told that the Reynolds Metals Company, the newcomer into the British Aluminium Company Limited, was not prepared to go on with this transaction for the purchase of Bell Bay. The only reason that it gave for not being prepared to do so was that the price was greater than the asset was worth. That came to me through Consolidated Zinc Corporation Limited, speaking, as I understand it, on behalf of British Aluminium Company Limited. That was confirmed When I arrived in America, when the representative of the Reynolds Metals Company in America told me that the price that was being paid for Bell Bay was far above the value which would be attributed to a smelter of that size in the aluminium industry. He sard1 that the price was so much greater than the circumstances warranted that his company was not prepared to join in the transaction with Consolidated Zinc Proprietary Limited.
– We ran it in the past, so why can we not run it in the future without the Reynolds Metals Company?
– I do not know the pertinence of that comment. I make this point, which may be of interest: There is much talk about the price not being satisfactory. I wonder whether anybody has sat down and applied to this transaction the normal method of valuation, that is, the capitalization of profits. If you take the profit that was earned last year - £122,753 - and capitalize that at 10 per cent., after tax you get a capitalized figure of only £736,520. I am not suggesting that that is the value of Bell Bay; but I do suggest that in view of that result which is arrived at by capitalizing profits, if we are able to receive the asset value in full, the transaction stands on its own virtues and is justified against any criticism.
The next point is that it is suggested that this is not the type of transaction which the Tasmanian Government would have preferred. I think the normal answer to such a suggestion is that that is a criticism for the Tasmanian Government to answer: it is not a criticism that should be levelled against us.
– The Tasmanian Government had no choice.
– All I want to do, in calm clear terms, is repudiate any suggestion that at any stage there has been any degree of compulsion or coercion on the Tasmanian Government. I point out that from the commencement of this transaction up to the present time the Tasmanian Premier has made a series of statements praising the transaction and welcoming the Kaiser group into the organization. Any criticism on that score must be answered by the telegram which the Leader of the Opposition (Senator McKenna) read out in the Senate last night, which seemed to me to ask in simple terms, “ Will the Federal Labour Party please be careful not to upset or destroy a transaction which has the complete approval of the Tasmanian Government and the Tasmanian people? “
Most ungenerous references were made to the 16,000 tons expansion programme. The facts of that programme are that the estimated cost is £3,000,000, of which the Tasmanian Government is finding £2,000,000 and the other £1,000,000 is coming from the resources of the Australian Aluminium Production Commission. As the Commonwealth Government is entitled to, in round figures, about tenelevenths of the resources of that commission the Commonwealth Government is contributing to that programme to that extent.
The criticism of the interest arrangements is quite unsound because it is based upon the argument that Bell Bay is worth its cost price or the capital invested in it. Such criticisms completely ignore the fact that the venture is earning only nominal profits. The great task that we had was to find some one who we were confident would develop the venture to the highest possible level in the shortest possible time, and who would be willing to re-pay us our capital investment in the venture. Our great task was to recover the capital that was invested in it. We made the arrangement that we would’ certainly recover our capital investment and that we would receive interest on our capital investment when the company made a profit of 6i per cent, on its investment. No one can deny that a profit of 6i per cent, on capital investment, after tax, is only a small return having regard to all that is involved in a venture of this size. In this transaction we got the best of all worlds. We get a return in full of our capital investment. We get interest on the moneys that are outstanding if the company is getting a small return on its capital investment.
It was quite unfair of Senator Armstrong to reel off a set of figures and say, “ There is no chance of your getting interest “. In statements I have made to the Senate and in my second-reading speech on this bill I have given estimates which indicate that after the plant is taken to a capacity of 28,000 tons we will get interest in full, subject to the situation that might arise as a result of the new income tax provision in relation to interest, the effect of which we do not yet know because it !has not been worked out. When a Minister, in a second-reading speech, makes a statement such as that, it is irresponsible conduct for a senior member of the Opposition to say that, on his computations, no interest at all will be payable - or words to that effect. He knows as well as I do that the figures I gave, although they were approved by me, were not worked out by me. No Minister makes a statement in a second-reading speech that he does not believe to be true and which he has not taken every step to verify. I say quite .calmly that I think it does very little credit to the Labour Party, in opposing this bill, to rely on that sort of argument. As I have said, we get the best of all worlds. We get a return of our capital. We get interest if the company is getting a 6i per cent, return on its capital investment. We get a quick, sound and progressive development at Bell Bay.
The agreement, of course, is expressed in conservative terms. The company that is buying this undertaking accepts an obligation to develop it to a 28,000-ton production capacity in the shortest possible period of time. We know that it contemplates calling tenders early in the new year. We know that the production capacity of the Bell Bay plant will be developed to 28,000 tons in the shortest ‘time in which it is possible for the contractors to carry out the necessary work. We know, also, that one of the problems that the company is at present facing is whether it can make arrangements to. go straight into the 28,000- ton programme without having an intermediate programme.
I repeat that we are getting the best of all worlds. Not only do we lay a foundation for the development of the bauxite deposits at Weipa, but we get a good price for our asset and we get adequate and generous treatment for all of the employees at Bell Bay. The people at Bell Bay, in my opinion, are entering a new era. They will go into a new, modern, up-to-date plant which will sell its product on world markets at world parity prices. There will be great opportunities for them to be promoted and to go ahead in a modern, progressive organization.
There is one other point that I wish to make. I think it was most unfair of those who criticized .the proposal to .say that the Kaiser organization was in the background all the while. Any one of ordinary intelligence would know that if we are to develop these Australian resources adequately, wo want a number of things. We want overseas capital in substantial quantities. We want that overseas capital to come from an organization which has a large fund of technical knowledge, because this is a changing industry. Even as we debate this matter to-night, great technical changes are under consideration in every part of the world which could make a big difference to us all. Last, but not least importantly, the incoming organization needs to have a knowledge and experience of overseas markets.
– Order! The Minister’s time has expired.
Question put -
That the words proposed to be added (Senator Sheehan’s amendment) be added.
The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)
Question so resolved in the negative.
Original question resolved in the affirmative.
Bill read a second time.
Clauses 1 to 3 agreed to.
Clause 4 (Approval of agreement).
– I direct the attention of the Minister for National Development (Senator Spooner) to subclause (2.) of clause 4, which reads -
Nothing in section nine of the Aluminium Industry Act 1944-1956 affects the validity of the Agreement, which shall be deemed to be, and to have been, as valid as if that section had not been enacted.
At first sight the purpose of that provision is not apparent to me. I direct the Minister’s attention to section 7 of the 1952 act, which repealed section 9 of the principal act and provided that -
A sale or disposal of the undertaking of the Commission, or of an interest in that undertaking, shall not be effected except with the approval of the Parliament.
That means, of course, this Parliament. I should be interested to know why the Government seems to be taking a double precaution by providing as it has provided in sub-clause (2.) of clause 4.
– I have been advised that this is a draftsman’s precaution because the agreement was executed before the bill came before the Parliament.
– I cannot quite understand what the explanation relates to. It seems to me that section 9 as it stands at present confers all the authority in the world, and that all that is required is a resolution of this Parliament. I notice clause 10 of the bill repeals the acts of 1944, 1952, 1954 and 1956. Why the draftsman or the Government should want a double affirmative - that is in effect what this amounts to - I cannot understand.
.- I think that Senator McKenna’s comment is hardly fair. It would be necessary to have some retrospectivity as to approval in order to ante-date the agreement or to adopt the form adopted in this clause. It is legitimate to be doubly sure when you are entering into contractual arrangements involving sums of money of the order envisaged under this agreement. I suggest that the comment that has been made is technical and insubstantial. Surely the Leader of the Opposition does not complain because the draftsman has seen fit to make sure that the parties committing their funds to this agreement are not misled by a technical invalidity of the agreement.
– I merely point to the double provision that is made. I consider that the clause is unnecessary in the circumstances, and I wondered whether there was some real reason for it.
Clause agreed to.
Clauses 5 to 10 agreed to.
– 1 note that the agreement is made between five parties - the Commonwealth, the State of Tasmania, the Australian Aluminium Production Commission, Consolidated Zinc Proprietary Limited and the new body that has recently been registered, the members of which will be the State of Tasmania and Consolidated Zinc. Let me refer briefly to Consolidated Zinc Proprietary Limited. On the eve of this debate we learned that Consolidated Zinc is now in partnership with the Kaiser corporation of America. I would like to ask the Minister for National Development (Senator Spooner) when he or the Government became aware of the Kaiser corporation’s interest in this proposition. Was the Government aware of Kaiser’s interest when the Minister announced the sale on 31st August last? Will the Minister indicate the nature of the arrangements between Kaiser and Consolidated Zinc? Do they become partners in Comalco? Will joint membership of Comalco give each of them a 50 per cent, interest in the Weipa deposits in Queensland, in the option over the Blair Athol coal deposits and also equal shares in the two-thirds interest in Bell Bay? T do not want to bombard the Minister with too many questions on the one subject at any time, but if it is convenient I will comment on some matters that arise under the schedule. If the Minister prefers I will leave those comments until later.
– I think it would be better to deal with these matters one at a time.
– As the Minister wishes.
– I think a fair answer to Senator McKenna’s question would be that the original arrangements between Consolidated Zinc and British Aluminium became changed in substance when Reynolds Metals became a substantial partner in British Aluminium. That created a changed atmosphere. The next development was when Reynolds Metals indicated its unwillingness to pay the price for which the Commonwealth was ‘holding out. Arrangements between Consolidated Zinc and the other companies are primarily the business of Consolidated Zinc and those other companies. I make that comment not with any desire to be difficult, but because I want to make it plain that I do not pretend to have a detailed knowledge of all the arrangements between these companies. It became apparent to me as an observer, and one who was very interested in the transaction, that when it seemed obvious there was to be a break in what we might loosely call the partnership between Consolidated Zinc Corporation and British Aluminium Company Limited, some other overseas company with the capital and the know-how would be sought out by Consolidated Zinc Corporation Limited. I had no knowledge of the negotiations. I had no knowledge of the finalization of the arrangements with the Kaiser organization until some two or three days before the press announcement was made. The only inquiry in my mind was with whom Consolidated Zinc Corporation Limited would link up, because we have not in Australia the capital needed to develop our resources to get proper value from them.
The basis of the arrangement between Consolidated Zinc Corporation Limited and the Kaiser organization was set out in the press statement made by the two organizations. My memory is that an announcement was made that the two organizations had joined together on a fifty-fifty basis for a first-stage project of £125,000,000 to develop Weipa, New Zealand and Bell Bay.
It was also announced that the KaiserConsolidated Zinc section of the organization would retain option rights over Blair Athol and other Queensland coalfields, and that the British Aluminium-Reynolds side of the organization would retain rights over the Gove bauxite deposits and the New Guinea water resources.
– Might I suggest to the Minister for National Development (Senator Spooner) that the fact that the Kaiser organization, or some other company, as the Minister anticipated, would join with Consolidated Zinc Corporation Limited, was an indication that Bell Bay would be of interest to all those largely interested in aluminium production throughout the world. Did it not indicate that if some attempt had been made to invite offers leading to negotiations, the Kaiser organization might have come in on its own instead of joining with Consolidated Zinc Corporation Limited?
I should like to ask the Minister also whether Alcan, a company already in Australia holding bauxite leases adjacent to Weipa, was given any opportunity at all to enter into negotiations. The Minister indicated in the course of the Senate debate that no approach had been made to world interests, but is it not obvious from the fact that Kaiser came in immediately after it was announced that Consolidated Zinc Corporation Limited had obtained possession of Bell Bay, that the great aluminium corporations of the world were, interested? Why was Alcan never asked to participate in negotiations, or never sounded out to find whether it was interested? Alcan is a company with a British Commonwealth background, and a company which has a lease over an area of raw bauxite deposits in Australia. As the Minister- argued a while ago bauxite is of no use unless it is mined, made into alumina, then into aluminium and finally fabricated. One would expect that Alcan would have been interested in a production unit such as that in existence at Bell Bay. It is quite obvious that the people holding an adjoining lease to Consolidated Zinc Corporation might be interested. I think the Minister should tell the committee whether any negotiations were opened up with Alcan. And secondly, does he not think that the ready entry of
Kaiser after the vacation of the field by British Aluminium Company Limited does counter his suggestion that other people were not interested?
After all is said and done, when the Minister refers to his consultation with the Reynolds organization of America and its distaste for the deal that was made by Consolidated Zinc Corporation Limited in buying Bell Bay at the price it did, he must take into consideration that that led to a complete division and sharing of the whole of the enormous, rich ore-bearing areas of bauxite on the eastern coast of Australia. In effect it was a cutting-up of the areas between two giant companies. One begins to wonder, I suggest, how far that was foreseen and might have been deliberately engineered by the Kaiser organization and the Reynolds organization. The whole of the Pacific area has now been carved up by the great American companies and companies from Great Britain. It is true to say that so far as Australia is concerned those organizations have complete control of the deposits on our eastern seaboard. I pose to the Minister the suggestion that the interest of people other than those with whom he was negotiating was obvious from the fact that they moved in the moment Consolidated Zinc Corporation acquired Bell Bay. I should like to hear the Minister’s comment on that aspect and also upon the failure, if any, to have talks with Alcan.
– Before the Minister for National Development (Senator Spooner) replies, I should like to ask him a question. Is it a fact, so far as the establishment of smelting works in Australia is concerned, that the Queensland Government has an agreement with Comalco that provided power can be supplied at a reasonable rate it is necessary for Comalco to build a smelter in Australia,, preferably in Queensland, within fifteen years, and that failure to do so, if power can be provided, will cause Comalco to lose one-third of its bauxite mining lease? Does the Minister know something about that aspect? As to Alcan having an adjoining lease, I take it there is nothing to prevent it going ahead and erecting a smelter of its own.
Senator- SPOONER’ (New South Wales - Vice-President of the Executive Council and Minister for National Development)” [10.191. - I shall deal with Senator Wood’s question first as I think it leads on to Senator McKenna’s question. An agreement does exist between the Queensland Government and Comalco relating to the development of bauxite deposits in Queensland. I would hesitate to attempt to construe the terms of that agreement. Senator Wood will remember that it is a very lengthy document covering all sorts of contingencies. I think it is correct to say that in general terms Comalco is obliged to erect a smelter in Australia within a certain period of time, or else satisfy the Queensland Government that it ought not to do so. The sanction for failure to do that is the loss of portion of the lease of Comalco’s bauxite deposits. The next stage is that Queensland is obtaining on the Gulf of Carpentaria a plant that will produce per annum 360,000 tons of alumina, which will yield 180,000 tons of metal. A township of 5,000 or 6,000 people will be created.
– By what year?
– The programme is to be completed by 1966. The port work will be commenced in March next year. There are documents, but in the final analysis we come to the question of what is a fair transaction between the people concerned. Queensland will obtain from this preliminary venture involving £125,000,000 an alumina plant on the Gulf of Carpentaria of far greater capacity than was originally contemplated. There will be greater immediate development on the Gulf of Carpentaria than was expected.
asked me, in effect, to surmise what might have happened in various sets of circumstances. I never like to speak for any other government than the Commonwealth Government, particularly if the other government is of a different political complexion. In some circumstances, I find difficulty enough in speaking for myself. I must instantly qualify what I have said by adding that in all these transactions it has been a pleasure to me to work with Mr. Reece, the Premier of Tasmania. The problem that faced the two governments was to sell the Bell Bay enterprise, not only for a satisfactory price but also upon such terms and conditions as to give us confidence that it would be quickly developed. We wanted to sell to some organization that had an Australian back- ground and Australian experience. When we talk of other aluminium interests, we must not overlook the consideration that although the capital of Consolidated Zinc is in Great Britain, the company is, in truth, an Australian company and the great majority of its activities are in Australia. Its officers and staff are known to us. This is a big, reputable Australian company which had no other aluminium interests.
– Which company?
– Consolidated Zinc. Quite obviously, its objective and ambition was to develop an Australian aluminium industry. Speaking for myself, that weighed a great deal with me. I do not know what other aluminium companies might do over the years. I talked with them, but one has no right to answer for what some one else might do. I finished firmly of the opinion that we would not have got a better price elsewhere.
– I notice that the agreement is between five parties, and I take it that it is binding only on those five parties. The Minister said, in his second-reading speech -
This finance will be provided by Consolidated Zinc and the Tasmanian Government in the ratio of two to one, subject to the proviso that the Tasmanian Government will not be under an obligation to find more than £3,000,000 up to the completion of the 28,000-ton stage. This is subject, as I have already mentioned, to the arrangement that the Consolidated Zinc interest will in due course be taken over jointly by that company and Kaiser Aluminium.
It seems to me that if there is no wedding between those two private enterprise companies the Tasmanian Government might be up for more than £3,000,000. Has the Minister any information other than what has appeared in press statements to show that there has been a wedding of these two companies? Is there any firm agreement between them that the Kaiser corporation will be in this venture jointly with Consolidated Zinc?
– We are dealing with the people who are named1 in the agreement. Whatever we might hear about the Kaiser organization and other organizations is in the nature of hearsay, but it is pretty reliable hearsay. They do not make statements for publication in newspapers without meaning them. Our transaction is shown in the documents that are before the Parliament. We agreed to sell to a company of which the constituent shareholders will be the Tasmanian Government and Consolidated Zinc Proprietary Limited. That is our only contractual obligation. That is, I expect, where we start and end legally. We are dealing in the terms of the agreement. When we hear that something relevant is in contemplation, we are morally bound, I think, to bring it before the Parliament in the second-reading speech. It is something to which we do not object. It is something to which we cannot object. If Consolidated Zinc and the Tasmanian Government are quite agreeable that Consolidated Zinc should sell half of its shares to some one else, we would need pretty good grounds upon which to complain. I may be wrong in saying that we cannot object. We might be able to object but, in any event, we’ would not object to that organization coming in.
– I direct attention to the fact that the parties to the agreement include Consolidated Zinc Proprietary Limited, a company incorporated under the laws of the State of Victoria and having its registered office at 53 Flemington-road, North Melbourne. I want to know whether that is a newly formed company or a long existing company. If it is a newly formed company, I want to know its paid-up capital and its substance. The other company involved is Aluminium Production Corporation Limited, which is incorporated under the laws of Tasmania, and has its registered office at 22 Murray-street, Hobart. We know that that is a newly created company and that the whole of its substance depends upon its paid-up capital. When I say that the substance of each of these companies depends upon their paid-up capital, I do not overlook clause 6 of the agreement which contains an undertaking by the State and Consolidated Zinc, that being the proprietary company to which I have referred. Clause 6 reads -
The State and Consolidated Zinc will ensure that, from time to time as is appropriate, the Company-
That is. Aluminium Production Corporation Limited, which is the recently incorporated Tasmanian company - will be provided with sufficient capital, by way of share capital or loans, to enable it to carry out its obligations under this agreement.
That clause drives one back to a consideration of the substance of Consolidated Zinc Proprietary Limited. If that is a new company, the whole of the substance of this agreement and the reliance that can be placed upon the purchasing obligation depend upon its paid-up capital.
– Consolidated Zinc is the company we have all heard about. It is a subsidiary of Consolidated Zinc Corporation Limited, which has its head-quarters in London. I do not know its ramifications, but it is not a new venture.
I do not know whether the capital and loan structure of the new company has yet been finalized. I have my doubts. These matters are still in the course of negotiation. We are relying upon the clause to which the honorable senator referred and which provides that in the fullness of time the two partners, Consolidated Zinc and the Tasmanian Government, will provide the capital and loan moneys that are necessary.
.- I note that clause 13 of the agreement provides that the sale shall be completed on 3rd January, 1961. That indicates that it is intended to transfer the title to the undertaking and the property in the plant and machinery to the purchasing company on that date. I ask the Minister for National Development whether the agreement contains any provision for security to the unpaid vendor over the undertaking during the time that the purchase money is unpaid.
– Somewhere in the mass of documents there is a proviso that the security of the Commonwealth Government and the Tasmanian Government will be in the form of securities over the fixed assets at Bell Bay. I have seen the draft of the terms.
– I do not want to weary the Minister for National Development by asking him to answer each question as it is asked. Perhaps at this stage I may refer to a couple of matters. I am proceeding through the agreement rather than wandering through it. I refer to the recitals on the first page of the agreement. Recital (g) reads - one of the objectives of the Company will be to increase the designed smelting capacity of the plant to 28,000 long tons of aluminium per annum and, if and when it is economically practicable so to do, to a designed smelting capacity in excess of 40,000 long tons of aluminium per annum;
When I turn to clause 19 of the agreement I find that a firm obligation is cast upon the new company in these terms -
The Company will as soon as practicable after the date of completion commence, carry on and complete works for the expansion of the plant that will increase the designed smelting capacity to not less than 28,000 long tons of aluminium per annum. 1 put it to the Minister that 28,000 tons is the limit of the capacity to which the company is committed by the agreement; it is under a binding obligation to go that far. But there is no binding obligation upon the company in relation to the ultimate objective of 40,0gp tons. That matter is dependent upon the company’s own consideration in due course.
– And the getting of power an.d other services.
– I am following the words of the recital - “ when it is economically practicable so to do “. On my reading of the agreement, there is no binding obligation on the company in relation to the 40,000 tons.
– That is correct. 1 make the point in> passing that you could not very well do more than that. The company could not be placed under an obligation to increase the capacity to 40,000 tons without the knowledge that it could get power and other services.
– I quite appreciate that. I wanted to be sure that there was no clause which required the company to increase the capacity to 40,000 tons.
Will the Minister tell me what remedy the Commonwealth would have against the new company if that company failed to proceed with the expansion to 28,000 long tons? The only one that occurs to my mind is that the Commonwealth might sue for damages. But I wonder how it would base such an action for breach of contract. It occurred to me that the Commonwealth might well have insisted, at that particular point, upon a provision, that, if the new company d:J not so proceed, the whole of the purchase consideration should fall due at an earlier date. Such a provision appears in clause 34 of the agreement, which provides that the company is not to sell the undertaking, or a substantial part of it, without the consent of the Minister. Sub-clause (2.) of clause 34 provides that, if the company does sell, it must immediately pay all moneys that are then outstanding. Having regard to the long spread of time for repayments, that is a pretty fair sanction upon the company. I suggest that perhaps the agreement would have been more effective if a similar sanction had been applied to clause 19.
– I ask the honorable senator to look at clause 5 of the agreement.
– Clause 5 provides -
The State and Consolidated Zinc will ensure that their respective nominees on the Board of Directors of the Company exercise their functions in accordance with the performance by the Company of its obligations under this agreement.
That is an obligation which rests upon the State and Consolidated Zinc.
– It throws the net out a little wider.
– It would throw the net wider, and the Commonwealth could sue the State or Consolidated Zinc for any breach of contract.
– I suggest that, if there are mortgage securities, there is probably a provision to the effect that they may be realized if there is a breach of any of the obligations of the agreement.
– I should think that would be so in relation to the payment of money.
– And also in regard to clause 19.
– Of course, we have not a memorandum of mortgage before us. I know there is a clear provision in the agreement for a first mortgage over all the lands of the company, and a floating charge over all its other assets. I am merely submitting to the Minister that the agreement may have been more effective if, for breaches of clauses of this kind, provision had been included for the company to pay the outstanding balance. That would be a very good sanction. J cannot imagine the Commonwealth suing l..? State of Tasmania or Consolidated Zinc for damages. But an obligation cast upon the new company to find the whole of the balance of its purchase money if it defaulted in an important provision of this kind would have been a very real sanction.
I envisage the possibility - I underline the word “ possibility “; I am not speaking of probabilities - that it may pay the new company, because of more advantageous wage rates, working conditions and supply of electricity in New Zealand, to transport alumina to New Zealand rather than to Bell Bay. It might become more economic for the company to close the Bell Bay works. After all, the company will be conducting operations on a vast scale. As the Minister has stated, it contemplates producing 360,000 tons of alumina a year, which would result in the production of half that quantity of aluminium. It contemplates going on to the markets of the world with the product of the Queensland deposits. It is obvious that, in the light of the operations that are contemplated, the production of even 28,000 tons in Tasmania would be relatively insignificant. The company might find that it would pay it to close the Bell Bay works and concentrate on the production of aluminium in New Zealand.
I should have expected to find a very clear provision in the agreement to the effect that the company would be required to carry on operations for a specified period of years, and that if it failed to do so, a particular sanction would be imposed. I have not been able to find anything of that nature in the agreement, and I ask the Minister to tell me whether he claims that there is such a provision.
Senator SPOONER (New South Wales - Vice-President of the Executive Council and Minister for National Development) T10.43]. - I do not say that there is in the agreement a provision which gives the Commonwealth certain rights if the purchasers do not proceed to increase the designed smelting capacity of the plant to 28,000 tons of aluminium a year, or in the event of the purchasers going out of business before that capacity has been attained. There is no sanction or proviso in the contract to cover those contingencies. However, I advance the argument that they are rather remote contingencies. The Tasmanian Government has a one-third shareholding in the organization. I cannot conceive of circumstances in which that Government would agree to the Bell Bay works being closed, nor can I conceive of circumstances in which a shareholder with two-thirds of the shares would outvote a shareholder with one-third of them on an important matter such as that. I cannot see that happening, nor can I envisage the company closing the Bell Bay works on the ground that it would be good business to do so. After all, this organization proposes to cater for the Australian market. I do not think that an organization can engage successfully in big business unless it has a good reputation and good business standing.
What sanction could be imposed if the company failed to continue in business, assuming its bona fides, as I do? I do not accept the view that it is within the realm of possibility that a £20,000,000 investment would be put on one side. After all, by the time that the capacity of the Bell Bay works has been increased to 28,000 tons, the sum of £20,000,000 will be involved. There is the £11,000,000 that is now being paid, and there will be the £9,000,000 that it will cost to increase the size of the plant. I cannot think of tangible advantages that would lead the company to walk away from a £20,000,000 investment. In this respect, Mr. Temporary Chairman, perhaps I am getting out of the field of logic and entering that of hopeful anticipation. My own view is that the 28,000 tons programme will be superseded by the 40,000 tons programme. But that is not in the bond, so to speak. It is only an expectation.
I do not regard the possibilities, to which Senator McKenna has referred, as likely to become realities. The only thing that I can think of that would lead the company to go out of business at Bell Bay is failure to trade profitably. I cannot imagine such a failure. In my experience, if a business cannot trade profitably there are not many worth-while sanctions that are available. In the net result, Sir, the only thing to be done would be for the other party to the agreement to go into the business and attempt to trade profitably, but all the probabilities are that it would not do any better.
The honorable senator has asked whether there should not be some remedy if the company failed to extend the plant to 28.000 tons capacity. In my view, that is only a theoretical consideration, because I cannot think of circumstances in which it would fail to do so. The honorable senator also asked why we should not bind the company to carry on operations for a denned number of years. My reply is that I really do not see the necessity to do so.
.- I wish to trouble the Minister on the question of the interest payments under the agreement. It has been calculated for me that the total interest on the outstanding balance, paid yearly at 5 per cent., will amount over the full period to £4,850,040. Having regard to the purchase price of approximately £11,000,000, that sum is sufficiently large to warrant our consideration for a few moments. Provision for the payment of interest is made in clause 10 of the agreement. The complicated third schedule provides the formula whereby the interest is to be calculated.
I wish to leave out of this discussion the somewhat incomplete reference that was made by the Minister in his second-reading speech to the incidence of tax in relation to interest on money borrowed by the com pany. Let us leave that novelty out of our consideration and turn to the situation in which an organization is buying an undertaking for £11,000,000. Before it is obliged to pay interest on the outstanding purchase money, it may provide for itself a dividend of 6i per cent. That is about £650,000. That consideration alone should suggest that it is wholly misleading to be guided to the proper price to be paid for this undertaking by a capitalization of £128,000, as was mentioned in the Minister’s reply to the second-reading debate, which is the present earning of the commission.
If we are to be confident that we will receive our interest, which for the first two years will be of the order of £400,000, we must have confidence that the new company can make out of its undertaking £650,000 for itself plus £400,000; otherwise we will not be paid our interest in full. If we are confident that that amount of about £1.000,000 a year will be yielded by the new company after it has injected into the capital the additional cost of £8,000,000 or £9.000,000 in expanding the output, which I understand it intends to do, that surely suggests that the prospective earnings of this undertaking should not be looked at in the light of the results of the last two years. To have a proper basis of capitalization, we must have a figure which is, in a business way, related to the figures I have mentioned, and which must be the expected yield of this undertaking once it is organized for ordinary commercial production. I should like the Minister to comment upon the consideration that has been given to that matter because his brief references to capitalization on the basis of the meagre yield in the first two years of its business do not satisfy me.
– I hope I did not leave the impression that I regarded the value of the undertaking as being the capitalization of the last year’s profit. I capitalized the last year’s profit and quoted the resultant figure, whatever it was. I hope that I was quick to add that that was not a valuation of the asset, but that it was a very apt description of the difficulty of realizing an asset at its investment value. If that method of profit capitalization yields such a small figure, one is in real difficulty in substantiating a figure many times greater as the investment value. 1 do not like answering these questions off the cuff. I would tilt a lance at Senator Wright on whether in any process of valuation you can justify bringing in a figure which includes as a component an anticipated profit. It is foreign to me to think that in any valuation you can say, “ This asset is earning only so much, but if we double its size and spend so much, it will earn so much. Therefore, we base a valuation upon that set of suppositions. “ I do not think you can take anticipation rather than realization as a basis for valuation. Of course, the real difficulty we faced was to determine a price for the asset. Our very clear opinion was that to attempt to call tenders or sell the undertaking at auction would depreciate its value. If a buyer did not come forward we would be left with something which we tried to sell but failed to sell, and which would therefore depreciate in value. Of course, we had estimates of what might be the profit earning capacity of the undertaking in the changed circumstances. We did not go into the 16,000 tons expansion programme without a careful appraisal of estimates that were prepared by the Australian Aluminium Production Commission. When we got into these negotiations, we made our computations of what we thought the future profit-earning capacity of the undertaking would be under the changed conditions. I do not think any one would blame me for carefully refraining from quoting those estimates, because frequently all that you hope for does not come to pass and frequently trading conditions change and become better or worse than you anticipate.
I think I said in my second-reading speech - if I did not say it before I say it now - that waving aside that interest qualification, our estimates indicated that if the capacity of this plant was increased to 28,000 tons a year we should be able to receive our interest in full, provided the return on capital was kept at 6i per cent., which I think is a meagre return upon the amount of capital invested. In any normal circumstances I do not think any one would face an investment of £20,000,000, with all its uncertainties, in anticipation of a return of 6b per cent. Of course, the formula that was worked out was not arrived at easily. It was the result of a lot of discussion.
I repeat what I tried to say earlier. I think the agreement gives the Government the best of all worlds. I do not think one can justify a valuation which would return the capital invested. Under this agreement, in the result we recover our capital investment for certain and we receive a share of the profits, by way of interest, after the company has received a return of 6i per cent, on its investment. I reiterate that a return of 6i per cent, on its investment is a very small return in relation to that investment. So, I think the Government gets it both ways. We recover our capital investment for sure, and in addition we receive the interest that will accumulate.
– On the question of interest, I put this question to the Minister: Does he consider that in the first four years, while the company is carrying out the expansion from about 12,500 tons to 28,000 tons a year, it will make profits that will enable it to pay interest? The Minister shakes his head. I too should not imagine that it would.
– Our expectation is that we will not receive interest in those early years.
– On my calculations, in the first five years the arrears of interest would amount to a sum of about £2,000,000.
– Four years.
– In four years it would be about £1,750,000. The Minister has expressed a degree of confidence based upon estimates that after allowing approximately 10 per cent, to cover the payment of tax and a dividend at the rate of 6i per cent., nearly £2,000,000 of arrears of interest will be picked up from half the amount in excess of the payment of tax, the payment of a dividend at the rate of 6i per cent., and the payment of a very substantial amount of interest for the current year; but that amount will be picked up over the remaining years.
– Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -
That the Temporary Chairman do now leave the chair and report to the Senate.
Question resolved in the affirmative. (The Chairman having reported accordingly) -
Tariff Board: Reports on Items.
The PRESIDENT (Senator the Hon. Sir Alister McMullin). - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -
That the Senate do now adjourn.
– I lay on the table the reports of the Tariff Board on the following subjects: -
Chlorination regulators and controllers.
Motor vehicle type voltage regulators.
Travel goods, handbags, wallets, purses and various other containers.
Passionfruit juice and passionfruit pulp.
Legislation will be introduced during the present session to implement decisions which the Government has taken to provide for payment of bounty on copper, sulphuric acid and pyrites. The Government has adopted the Tariff Board’s recommendation for bounty payments on the production of copper, but has decided to review the situation again in three years rather than in five years as recommended by the Tariff Board. On sulphuric acid and pyrites the Government has adopted the board’s recommendations for payment of bounty at a level which will offset the average cost disabilities of local producers.
Question resolved in the affirmative.
Senate adjourned at 11.2p.m.
Cite as: Australia, Senate, Debates, 30 November 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19601130_senate_23_s18/>.