23rd Parliament · 3rd Session
The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers.
Assent to the following bills reported: -
Wool Tax Bill (No. 1) 1961.
Wool Tax Bill (No. 2) 1961.
Wool Tax Assessment Bill 1961.
– by leave - With deep regret I advise the Senate of the death on 27th August of the Honorable James Mackintosh Fraser, a former senator from Western Australia. I propose to place his parliamentary career on the record of the Senate, as is usual. It is very desirable to do that, but on this occasion we think, not only of the parliamentary record of ex-Senator Fraser, but also of the loss of a friend.
The Honorable James Mackintosh Fraser took his place as a senator for Western Australia in July, 1938. He retired from the Senate in June, 1959, so that he served for 21 years. At various periods during that time he held the portfolios of External Affairs, Health, Social Services and Trade and Customs. At other times he was an Assistant Minister. He assisted the Minister for Commerce and Agriculture, the Minister for the Army, and the Minister for Supply and Shipping, so that on various occasions he had experience in no fewer than seven different portfolios. In addition, during 1944 and 1945, he had the great responsibility of being an acting member of the War Cabinet.
He came into the Senate, Mr. President, after long experience. He was an official of the Tramway Employees Union, and subsequently he was an alderman of the Perth City Council from 1928 to 1937. I feel that on this occasion, as well as placing our views on the official record, many of us would like to pay a personal tribute. Feelings sometimes run fairly high in politics. Things are said in the heat of the argument that are subsequently regretted. I should like to say that in the nine years during which Jim Fraser and I were together as members of the Senate, I do not remember an occasion when he offended in that way. I am sure that honorable senators on both sides of the chamber think of him in a friendly way. We remember that we were on pleasant personal terms with him, whatever our political views may have been.
In my early years in the Senate there were quite a few occasions when he gave me that personal and helpful advice which one always remembers. It is sometimes trite to say that the world is worse for somebody’s passing, but it would not be trite to say so on this occasion. I think we can truthfully say that, in expressing our sympathy to the members of Senator Fraser’s family, we are paying a tribute to one who was not only a notable parliamentarian but also a sincere and friendly colleague. Mr. President, I move the formal motion -
That the Senate expresses its deep regret at the death of the Honorable James Mackintosh Fraser, former Commonwealth Minister and Senator for the State of Western Australia, places on record its appreciation of his long and meritorious public service, and tenders its sincere sympathy to his widow and the members of his family in their bereavement.
– On behalf of all members of the Opposition, I second the motion which the Leader of the Government in the Senate (Senator Spooner) has proposed. We of the Opposition learned with deep grief of the passing of our former colleague, Senator James Fraser. As Senator Spooner has said, Senator Fraser was in the Parliament for a period of 21 years. He was one of the few persons in Australia to whom is accorded the privilege of being a member of a federal cabinet.
As Senator Spooner properly recounted in the course of his remarks in support of his motion, Senator Fraser had the widest possible spread of ministerial experience. He held, in one way or another, no fewer than seven portfolios and had the distinction and the responsibility of serving in the Government in a crisis for Australia - World War II. The fact that he was given so many important posts is the measure of his ability and worth in the eyes of his parliamentary colleagues, and is an indication of the deep respect that they had for him and for his qualities.
I recall very well taking over from Senator Fraser the portfolios of Health and Social Services on 18th June, 1946. I remember that on that evening the then Prime Minister, Mr. Chifley, travelled with Senator Fraser and myself by aeroplane to Sydney, where we were to be sworn in as new Ministers by the Administrator, ihe then Chief Justice of New South Wales. At that time Senator Fraser moved on to take over the portfolio of Minister for Trade and Customs, as it was then known.
Looking back on the course of events, one must acknowledge that it was during Senator Fraser’s term as Minister for Social Services that, with the help of the Social Security Committee of those years, the true foundations were laid of the broad spread of social security benefits of all kinds that are now available to the people of Australia. Unquestionably, he was the immediate ministerial architect of the programme.
One other thing which I feel under an obligation to record is that he was the first to address himself to the problem of consolidating the 51 separate acts that at one time constituted the Commonwealth legislation dealing with social services. He began that mammoth task, and I had the privilege and honour of completing it in 1947. If Jim Fraser had done nothing but initiate those two matters, his name would have remained enshrined not only in the history of the Parliament but also in the memory of all members of his party.
Unfortunately, his more recent years in this Parliament were marred by illness. We sympathized with him at the time in that misfortune. We regretted his retirement on 30th June, 1959 - just over two years ago. It is a matter for regret to us all, too, that his retirement, which was all too brief, was to some extent affected adversely by ill health. But it was a situation that he faced as he faced all difficulties - with courage and cheerfulness.
We of the Opposition salute him as a stalwart of the Labour movement - as a man who was truly imbued with the principles of the Australian Labour Party. We salute him, too, as one who has served his adopted country, Australia, with great distinction and great integrity. I agree with the remarks of Senator Spooner in regard to the qualities that were so consistently displayed by Senator Fraser in his personal relationships. He had a most sunny and genial disposition, and that won for him not only the warm friendship but also the very real affection of all those who were fortunate enough to know him well. The news of his passing has saddened many hearts in this place to-day.
Our thoughts go out to his widow and her family, because this is the day upon which his body will be buried in Perth. It is a most harrowing day for them. Jim Fraser was, above everything else, a devoted family man; he was a shining example of the real family man. On behalf of the Opposition I extend to his widow and the members of his family, who have meant so very much to him, heartfelt sympathy in their bereavement. I trust that they will be given the strength to bear their burden of sorrow. I hope they will be consoled by the thought that the late senator is now reaping a proper reward for a full life that was very well spent.
– Mr. President, I should like to associate my colleagues of the Australian Country Party with the sentiments that have been expressed by the Leader of the Government in this place (Senator Spooner) and the Leader of the Opposition (Senator McKenna) on the passing of the Honorable James Fraser, a former member of the Senate. All who knew Senator Fraser admired him for his strength of character and the sincerity of his political convictions. He was a kindly man and was generous in his thinking. He was respected by all who knew him. I extend to Mrs. Fraser and her family the deep sympathy of the members, of my party.
– Mr. President, on behalf of the Australian Democratic Labour Party I should like to join the previous speakers in their expressions of condolence to Mrs. Fraser and her family. Senator Fraser was one of the kindly and lovable characters of the Parliament. We regret his passing and extend to his sorrowing wife and family our sincerest sympathy.
– I wish to associate myself with the motion before the Senate. I enjoyed with the late exSenator Fraser a long and close personal friendship extending over many years. Indeed, our friendship extended back for years before I entered this Parliament and in fact for years before he entered the Parliament. We both resided in the same suburb of Perth - a suburb which ex-Senator Fraser for many years represented as an alderman on the City Council. It was during that time that my friendship with him began, and it is the memories of those years in particular which I have in mind to-day. I remember the complete manner in which he gave himself to any community effort - to any effort that was promoted for ihe good of the community. If I may say so, I am proud to have had the honour of being associated with ex-Senator Fraser in some of those community efforts.
The late ex-senator was kindness and consideration itself. I think of two instances in that connexion. The first concerns my service career. As a member of the Royal Australian Air Force, and having been scrubbed from a flying course, I applied for a discharge in order to join the Australian Imperial Force. My application was rejected quite emphatically. Indeed, it was rejected quite stubbornly. On one occasion when I was on leave I took the opportunity of seeing Senator Fraser and asking him what he could do for me. He told me what I already knew - that what I was doing broke every rule in the book. But the following week the transfer so long delayed came forth.
I remember also his warm and sincere congratulations to me when I was appointed to the Federal Ministry. I remember his quiet and encouraging words of advice on more than one occasion at a time when 1 was a very new Minister. As has been said, ex-Senator Fraser was a most sincere and honest man, profoundly devoted to his family. My sympathy goes out to-day to his widow and to the members of his family.
– I wish to say a few words in support of the motion before the Senate. I had the pleasure of being in the Senate when ex-Senator Fraser was here. 1 always found him to be a man with a very friendly nature. In those days senators who came from distant States were forced to stay in Canberra over the week-ends. 1 well remember the friendship that I enjoyed with ex-Senator Fraser during games of bowls and other pastimes at week-ends. We spent many happy times together. 1 found him always a very good debater and very sincere in anything that he did.
When he was Minister for Health and 1 was a member of the Joint Committee on Social Security he was very helpful to me on many occasions. He often clarified for me matters concerning government policy. Ex-Senator Fraser was a very strong supporter of Western Australia. Whenever anything was said about Western Australia he had something to say in return. I express my deepest sympathy with his, widow and his children in their very sad bereavement.
Question resolved in the affirmative, honorable senators standing in their places
– My question, which is addressed to the Minister for Customs and Excise, relates to the report of the Commonwealth Chief Film Censor, Mr. Campbell, which states that the trend in film entertainment is disturbing because of its possible effect on the minds of young people who may well gain the impression that crime, immorality and violence are the dominant features of Western civilization. Mr. Campbell also suggests that consideration be given to forbidding children by law from attending the screening of such films. My question is: As the State ‘ governments have discarded this latter method of forbidding children by law from attending the screening of such films because of the difficulty of policing such legislation, will the Government inquire into other methods of dealing with the problem, possibly by a committee of inquiry on which representatives of Commonwealth and State governments, the film industry, educational authorities, writers, actors and the Churches could be included?
– The honorable senator has referred to the annual report of the Chief Film Censor, Mr. Campbell. I believe that all honorable senators, when they have read this report, will agree that Mr. Campbell and his staff are fully seised of the responsibility that they have in respect of film censorship. The honorable senator has said that the States have not accepted responsibility for the policing of films, and has asked me whether the Commonwealth will give consideration to the adoption of other methods. I should like to have an opportunity to consider that position. I am not prepared to give an answer off the cuff because I do not know what other methods could be considered.
The Commonwealth Film Censorship Board classifies films directly by virtue of powers stemming from the States. Four of the States have given the Commonwealth power to classify films on their behalf, and the board classifies them. I believe that it is the responsibility of the State governments - particularly the governments of those four States that voluntarily gave the Commonwealth that power to classify films on their behalf - to see that this matter is policed within their borders. 1 do not see any reason why that cannot be done. If a film is classified as unsuitable for children, a State government has only to do what is done in other countries, namely, place on the heads of the theatre owners the responsibility for seeing that the film is not shown before children. I believe that the States have a responsibility which they can and should measure up to. I will consider the question raised by the honorable senator regarding the adoption of alternative methods.
– I ask the Minister representing the Attorney-General: Apropos recent press reports, is there any legal prohibition upon an Australian-born citizen enlisting in the armed services of any foreign country, irrespective of whether or not the Commonwealth of Australia has friendly relations with that country?
– I am not clear about the exact position under Australian law; but generally there is not a legal prohibition upon a citizen enlisting in the forces of another country. However, if a citizen enlisted in the armed forces of another country and was required to take an oath of allegiance to the government of that other country, generally, that citizen would forfeit the citizenship that he originally held. Whether, in addition to that forfeiture, there would be some legal breach, I am not in a position to tell the honorable senator. I will endeavour to find out and let him know the answer.
– Will the Minister representing the Minister for Shipping and Transport tell the Senate the reason for the Government’s most-favoured treatment of South Australia in providing £1,325,000 of Commonwealth money for the purchase of new diesel rolling-stock for the Port Pirie to Broken Hill railway? Why has South Australia been singled out for this financial favour, and why can no offer of this nature be made to Queensland?
– I think that the Prime Minister adequately covered this matter in a statement which he made in answer to a question in the House of Representatives yesterday. His answer made it quite clear that the purpose of this loan for the purchase of rolling-stock for the Government of South Australia was to assist that State in its railway rehabilitation. As Queensland is in negotiation with the Government in connexion with rehabilitation for an amount which will involve far greater assistance than that which is being extended to South Australia, I fail to see that Queensland can complain of what is described by Senator Courtice as the favorable treatment extended to South Australia.
– I direct to the Leader of the Government in the Senate a question relating to the magnificent grant of £41,000,000 by the Commonwealth Government for the building of a standardgauge railway from Fremantle to Kalgoorlie, in Western Australia. In view of the fact that a loan was negotiated for the reconstruction of the line between Mount Isa and Townsville, is the Government prepared to reconsider the terms of repayment, and will it subsidize that scheme in the same manner as it has subsidized other railway schemes throughout
Australia, more particularly as this line, when it is rebuilt, will help Mount Isa to earn more overseas credits for Australia than are earned by the wheat industry, which is an important matter?
– I follow the lead that was given by Senator Paltridge and refer Senator Wood to the statement made by the Prime Minister, which very explicitly covers the principles that are involved. What the Government has done for Western Australia was on the same terms and in accordance with the same principles as what it is doing for Queensland.
– I am not objecting to what is being done for Western Australia.
– No, but the honorable senator is suggesting that more should be done for Queensland because of what has been done for Western Australia. My reply is that Western Australia has not been treated in any way more favorably than Queensland. The Western Australian railway project falls into two parts. That proportion of the expenditure which arises from the overall standardisation of main-line railways throughout Australia is being financed on the standardization principles. That proportion which is related to a big developmental project, in the same way as the Mount Isa railway reconstruction is a big developmental project, is being borne by the State of Western Australia in the same way as the cost of the Mount Isa line is being borne by the State of Queensland. The Commonwealth contribution is to assist Western Australia to finance the transaction in the same way as the Commonwealth is assisting Queensland to finance its transaction. There is no difference, in principle, between what is being done in each State. The Commonwealth is financing the work, which is the responsibility of the State Government, on favorable terms so that development may go ahead.
– Has the attention of the Minister representing the Minister for Primary Industry been- directed to the latest report of the Commonwealth Scientific and Industrial Research Organization, in which it is stated that research into increasing the weight of wool per head for sheep has resulted in the achievement of a 20 per cent, increase, even though drought conditions existed during part of the experimental period? In view of the many problems facing the wool industry, will the Minister give consideration to using a portion of revenue from the Wool Tax Act for the purpose of supplying every wool-grower in Australia with details of the procedure followed by the Commonwealth Scientific and Industrial Research Organization to achieve such dramatic increase in the yield of wool per sheep?
– I have seen the report, although I must confess that I have not given it the study it merits. The honorable senator asks whether consideration will be given to diverting some of the wool tax money to making information about the experiments available to the growers. In reply, I make this point: This Government has repeatedly affirmed that the proceeds of this tax, the imposition of which has been asked for by the growers, shall be disposed of by the growers. I would think that the only contribution that the Government could make would be to point out to the growers the wisdom of their informing themselves on these experiments. The growers might then suggest that portion of the tax collected be made available for that purpose. I am quite sure that the Government would not divert a portion of this revenue unless it were asked to do so by the growers.
– I wish to direct two questions to the Minister representing the Minister for Primary Industry. First, can the Minister inform the Senate why prices for overseas sales of wheat are quoted on a tonnage basis, f.o.b.? Secondly, as all local prices for wheat are quoted on a bushel basis, and the use of the tonnage quotation in relation to overseas sales tends to cause confusion concerning the price per bushel we obtain from overseas customers, will the Minister endeavour to have this apparent anomaly corrected?
– It is true that sales of Australian wheat for home consumption are always transacted on a bushel basis and that sales of Australian wheat to overseas countries are transacted on a tonnage basis. The reason for the latter is that the contracts of sale are written in terms of tons, not bushels. As 374 bushels of wheat go to the ton, a simple mathematical calculation enables the price per bushel to be ascertained.
– I address a question to the Minister for National Development. Has he noted a recent press statement to the effect that Sir Arthur Fadden is not prepared to tender for the handling of iron ore from Mount Goldsworthy to Port Hedland, in Western Australia, because he claims, first, that the deposits do not contain the tonnage of ore that the Minister for Mines in Western Australia has estimated they contain and, secondly, that the quality of the ore is much lower than that Minister believes? Will the Minister advise me whether he has any information on this subject because, if Sir Arthur Fadden’s opinions are correct, they could considerably influence any prospective tenderer? I understand that tenders may be submitted only up till 4th September.
– I have seen a press report to the effect that my friend and former colleague, Sir Arthur Fadden, had said that the steel merchants in Japan had adopted certain views in this matter. I also saw a contradiction of that statement which came, I think, from one of the steel companies concerned in Japan. As to what may be the views of Sir Arthur Fadden and the people he represents, that is a matter for the Western Australian Government. lt is not a matter that concerns the Commonwealth. The Western Australian Government is the government that is concerned with the disposal of iron ore from these deposits. The approval of the Commonwealth was obtained to the terms and conditions under which the deposits were to be available for export. These are large deposits, amounting to 30,000,000 tons of iron ore.
I was satisfied at the time that adequate steps had been taken to ascertain that the requisite quantity of iron ore existed in the deposits. I suppose there must be some margin for error with deposits of 30,000,000 tons. The information I had was that the proper steps had been taken to estimate the quantity of ore and, so far as was practicable, the quality of the ore. The probabilities are that, whoever the successful tenderers may be, some reservation will be made to give them an opportunity to proceed to further drilling in order to test the quantity and quality of the ore before entering into the large-scale commitments that would accompany a big transaction of this kind.
– In directing a question to the Minister for National Development, perhaps I should first ask permission to do so from Senator Scott, because the subject of the question is oil, in which the honorable senator shows an almost exclusive interest. I ask the question with a full appreciation of the help that the Government has given in the Budget towards meeting the cost of oil exploration. I have just received a copy of a pamphlet entitled “A Four-Year Plan”, issued by the Australian Petroleum Exploration Association. It states that the association has submitted to the Government a four-year plan for oil exploration, involving the creation of a £25,000,000 fund to be expended in a crash programme of seismic and drilling activity. It goes on to explain the value of planning over a set period rather than on the basis of annual grants, and of having contributions from the Government matched by contributions from private enterprise. I ask the Minister whether this plan has been considered by the Government and whether he cares to comment on it.
– I have had discussions with representatives of the association to which Senator Wright has referred, and they have submitted the plan to me. 1 make bold to say that when the legislation, which I hope to bring before the Senate in the near future, is unfolded it will fulfil most of the requirements as the Government sees them. The provision of money by the Commonwealth for oil search is based upon the estimate that such provision will meet the maximum number of applications that will be made over the next year. I do not want to anticipate the legislation. I merely say that I know the plan and have discussed it with representatives of the association. Nobody in this world is ever completely satisfied, but I think that what we have done meets the circumstances.
– I address a question to the Minister representing the Minister for Shipping and Transport. Has he read, in a newsletter signed by Mr. W. W. D. Daunt, the secretary of the Federal Chamber of Automotive Industries, the statement that motor vehicle registrations in Australia are expected to reach 3,000,000 in 1962, or a rise of 2,000,000 since the last full year of office of a Labour government?
– Back to 1949 again!
– Yes. Can the Minister explain how this phenomenal rise of 200 per cent. in vehicle registrations has occurred, when in every three-year period, and sometimes in shorter periods than that, depending on whether elections have been looming, the Australian Labour Party has preached, prophesied and hoped for depression? Is it a fact that most Labour members have been endeavouring during the Budget debate to place in the minds of Australia’s electors a depression fear complex? If this propaganda were successful, to what extent would it increase unemployment in Australia?
– It is always refreshing to hear a question which is entirely non-political. I have not seen the statement made by Mr. Daunt, or attributed to him, but I am delighted that he has put his signature to the statement referred to by Senator Scott because in recent times some of the statements to which he has subscribed his name have frequently been critical of the Government and sometimes unfair. On this occasion Mr. Daunt’s statement seems to commend the Government. On others, he has been critical. Like the Labour Party, he is apparently confused. Of course, the truth breaks out. The article mentioned by Senator Scott reveals the measure of progress made by this country since it has enjoyed a Liberal Government. I am sure that it will be on that basis that the people of Australia will pass judgment at a later date.
– My question also is addressed to the Minister representing the Minister for Shipping and Transport. Is he aware of the names of the four major motor companies which entered into an agreement with the government of the day to increase the Australian content of motor vehicles assembled in this country? During which years did those four companies commence to tool-up for the purpose of achieving that objective?
– I am not aware of the particulars for which the honorable senator has asked. I should have to ask my colleague, the Minister for Shipping and Transport, for them. If the intention of the honorable senator is to try to create the impression that this Government has been deficient in any way in encouraging the motor industry of this country, then I am sure he has failed.
asked the Minister representing the Minister for Repatriation, upon notice -
– The Minister for Repatriation has supplied the following answers: -
asked the Minister representing the Minister for Health, upon notice -
– The Minister foi Health has furnished the following replies: -
– On 16th August, Senator Vincent asked me the following question: -
My question, which is directed to the Minister representing the Postmaster-General, deals with a matter that is of considerable interest to many people in Western Australia, namely the destruction of native flora in Western Australia by officers of the Postmaster-General’s Department when carrying out their public duties. I have been told and have personally observed that officers of the department, when carrying out their duties, have been guilty of destroying to an unnecessarily high degree some of the very valuable native flora in the bush of Western Australia. I have also been advised that various bodies concerned with the protection of our flora, such as the Tree Society of Western Australia, and the Wild Flower Society of Western Australia, have invited the department to co-operate, but their efforts have been to no avail. Will the Minister ensure that proper instructions are given to officers of the department in order to prevent this unnecessary destruction of flora that is unique in the world and which is highly valued by the citizens of Western Australia?
The Postmaster-General has now furnished me with the following information in reply: -
The Postmaster-General is disturbed by the allegations in the question asked by Senator Vincent that there is an unnecessarily high degree of destruction of valuable native flora by officers of the Postal Department and that they have failed to co-operate with the bodies set up for the protection of flora in Western Australia.
The department is very conscious of the importance of preserving native flora. The definite policy in this matter requires that there shall be as little destruction of native flora and fauna as is consistent with the department’s responsibility to provide and maintain essential telephone and telegraph services. All members of the staff engaged in line construction work have been instructed to exercise special care, and supervisory officers are constantly watchful to ensure the observance of the instructions to protect flora.
Officers in Western Australia are unaware of any unnecessary destruction in recent months and appreciation has been expressed for the cooperation which is being extended by the Postal Department in this matter.
– On 16th August, Senator O’Flaherty asked me the following question: -
Does the Minister representing the PostmasterGeneral know whether the Postal Department has been supplied with a quantity of faulty ferrule telephone joints which are causing intermittent connexions and that a major share of such faulty ferrules has been used in the extension of the Elsa automatic area embracing Reynella, Morphett Vale, Noarlunga, Port Noarlunga and McLaren Vale in South Australia? Can he say whether anything has been done to rectify the faulty joints?
The Postmaster-General has now furnished me with the following information in reply: -
Investigation of plant performance records in the McLaren Vale district does not disclose existence of the particular fault liability described and no special concentration of material types has been arranged. If details can be supplied, further investigations will be undertaken immediately.
– I lay on the table a report by a deputy chairman of the Tariff Board on the following subject: -
The deputy chairman’s recommendation that no action be taken has been accepted by the Government.
Report of the Australian Capital Territory Committee.
– On behalf of the Joint Committee of the Australian Capital Territory, I bring up the committee’s report relating to the Australian Capital Territory tourist industry which was referred to the committee by the Minister for the Interior (Mr. Freeth) on 12th July, 1960.
The committee has been concerned, not only with the importance of the tourist industry as such, but also with the importance of inducing and enabling citizens, and young people who will become Australian citizens, to visit the capital of the Commonwealth.
Ordered to be printed.
Debate resumed from 24fh August (vide page 242), on motion by Senator Spooner -
That the following paper -
Australia and the Common Market - Statement by the Prime Minister dated 16th August, 1961- l)C printed.
Upon which Senator McKenna had moved by way of amendment -
Leave out all words after “ That “, insert “ the Senate, while declaring that the United Kingdom’s move to join the Common Market requires the strongest action to protect Australia’s interests, expresses no confidence in this Government’s ability to provide it because of its lack of foresight and frankness in this matter, its dilatoriness now, and its continuing failure, as demonstrated by the Prime Minister’s speech, to appreciate the real issues which are involved “.
.- Before the debate was adjourned last week I had been pointing out that there was nothing new about the Common Market. I had shown that such markets had been formed and operated in the ancient city States of Greece and in ancient Rome, and that modern Prussia had formed the federation of States which ultimately became modern Germany. I gave the examples of San Marino, Monaco and the Union of South Africa. Many of these unions were successful both politically and economically. Those two aspects are inextricably entwined, and we cannot even begin to consider the economic aspects of the Common Market without constantly bearing in mind the political implications.
Perhaps One sure sign that Western Europe in on the right track is the blast of disapproval from the Moscow radio. There have been violent attacks on the proposals from Moscow, largely because Russia realizes that if Europe becomes strong and united, and ceases its internecine strife, there will be a third powerful bloc in the world - a powerful bloc which of its very nature will be violently opposed to Communist ideology and Communist aggression.
One of Senator Hendrickson’s least wellconsidered remarks last week was that Mr. Menzies and Mr. Khrushchev both disapproved of the Common Market. I think this was a clumsy attempt, as I said before, to manufacture a unity ticket. We know why Mr. Khrushchev objects to the European Common Market; I have referred already to that. The Prime Minister’s careful statement showed that he understood Britain’s problems, but that, as Prime Minister of Australia, he was anxious first-, to protect this country and her industries.. If I can take the metaphor a little further.. I do not think any executive will be asking, the Prime Minister to make a statutorydeclaration that he did not know his name was on that ticket.
Let me refer to the political implications of Britain joining the Common Market We have to bear in mind that we will be faced, economically, with a complete reversal of the position that has hitherto obtained for our products in the British markets. It will seem strange for us to contemplate, and difficult for us to counter, the position that Danish butter will bt sold free of duty in Britain and tha’ Australian butter will bear the same impos in Britain as it would bear in any one o) the other six Common Market countries
The organization established by the Rome Treaty provides not only for the formation of a customs union between the six countries but also for measures of economic integration within the community. These include the abolition between the member States of obstacles to the free movement of persons, services and capital, the inauguration of s common agricultural policy and common transport policy, the co-ordination of thi economic policies of the member States, and .the establishment of a European socia fund and a European investment bank te service the community. Provision is made also for the association with the Economic Community of the overseas territories anc some former territories of member States A simple, bald recital of those facts and i consideration of the fact that the Treat of Rome provides for the setting up of i court of justice to interpret the workings of the treaty are the clearest possible indication that the ultimate result of the bringing to fruition of the Common Market must be the creation of a United States of Western Europe.
In this connexion, it is interesting to examine the approach of some of the countries of The Six to Britain’s entry to the Common Market. Our allies, the French, who were quite weak economically after the last war, have expressed grave doubts about whether any negotiations with Great Britain will be permitted. De Gaulle himself has said that he is opposed to any conditions attaching to Britain’s entry to the Common Market which would allow Commonwealth territories to have a continuing benefit in British markets. But the Government of the Federal Republic of Germany has given a great welcome to the British proposal to join the Common Market. Another aspect of the matter which intrigued me a little was that a country such as Luxembourg which, I suppose, without any derogatory reference being made to that country, is chiefly known to most of our people as the locale of a musical comedy, has the right to veto the application of a powerful nation such as Britain to join the Common Market.
I desire to refer again, Mr. Deputy President, to the approach of the German Government which, in the present troubled state of the world, is particularly refreshing. In the “ Bulletin “ issued by the German Federal Government at Bonn on 8th August last the following statement appears -
Mr. Macmillan’s announcement and the subsequent debate and vote in the House of Commons gave been greeted unanimously by the press and :he Government of the Federal Republic as 1 decisive step forward in closer European ;o-operation - both economically and politically.
The following paragraph is of particular significance in view of our difficulties -
In particular, appreciation has been expressed >f the problems facing the British Government in connection with the intended step: the consideration due to the Commonwealth, the requirements >f Britain’s own agriculture, and the United Kingdom’s obligations towards the other members of the Economic Free Trade Association (EFTA). n view of this situation, the resolution of the House of Commons is being regarded in Bonn is a victory of the champions of European integration The road is now clear for practical negotiation it is being said in the Federal capital, The Federal Government itself is determined to do everything in its power to bring about a satisfactory solution for the problems involved in Great Britain’s joining the EEC.
Then the Bonn “ Bulletin “ goes on to say -
That the Federal Government-
The Federal Government, of course, always meaning the Federal Government of West Germany - is prepared to contribute as much as possible towards facilitating Britain’s accession was made clear by the Federal Minister for Foreign Affairs, Dr. von Brentano at the last Council meeting of the Western European Union. The Federal Government, he said at that time, regards the integration of the “ Six “ not as an end but as the beginning of European co-operation built up on firm contractual foundations and made secure by a clear-cut institutional order.
If that is the welcome which Britain is to receive from a former enemy country with which just a few years ago we were locked in mortal combat, it would seem to be a happy augury for the ultimate sanction of this kind of international union and association.
The West Germans, in their “ Bulletin “, go even further. The statement continues - . . Dr. von Brentano told press correspondents in Bonn that it ought to be possible to conclude a treaty with Britain that would take into account the peculiarities of that country’s situation.
That wording is of particular significance to us in Australia, because it is clear from that statement by a responsible Minister in the German Government that Germany realizes the almost unique difficulties which a country such as Britain would face in joining the Community. It seems to be a clear indication that the German Government is prepared to enter into the form of negotiation and discussions in relation to Britain’s application to join for which we have been hoping.
– But how do you match that with de Gaulle’s attitude?
– I am speaking of West Germany. I concede that General de Gaulle’s statement has not been reassuring. At all events, one of the most powerful countries has given us some reason to hope. The statement continues - “ After all “, he continued, “ the Rome Treaties are evidence that it is possible to allow for a country’s special situation, at least for a period of transition. So I believe that the goal can be achieved if we go into the negotiations with a sufficient measure of pragmatism and a minimum of perfectionism. Britain’s decision to link herself with the European Continent more closely than hitherto seems to me of such decisive importance that, on behalf of my Government, I shall do all I can to bring this intention to fruition.”
If only the other five members of The Six will adopt a similar attitude towards the negotiations with Great Britain, we may hope sanguinely that Great Britain’s entry will not bring about the disruption of our exports which has been feared in some quarters.
Of course, it is impossible to predict the exact effect of Britain’s entry. Nothing will affect the sentimental attachment to the little group of islands whence most of our ancestors have sprung; but it would be idle to deny that with the British Isles wrapped up body and soul in the European community, the ties with the British Commonwealth will remain unaltered. Obviously, it will be difficult for the Commonwealth to remain the same when the head country has virtually entered what will become the United States of Europe.
In July of this year the Council of The Six issued a statement saying that it was convinced that only a united Europe allied with the United States and other free countries could meet the dangers facing the free world. It was this statement that brought forth the wrath of Moscow. Naturally anything which tends to unity in what used to be described as the mad continent, the cockpit of most of the world conflicts over the last 200 years, and anything which tends to remove the sources of conflict, argument and struggle, must be unpopular in Moscow. The mere fact that the union will very much strengthen the constituent nations is, of course, a source of dissatisfaction to the Kremlin. So the more abuse we hear over the Moscow radio the more firmly we must be convinced that the idea of the Common Market is a good one.
– It annoyed this Government, too.
– I do not think that is a completely accurate statement of fact. We may get a chance to talk about that later. We must realize, too, that Britain’s entry to the European Common Market will not occur suddenly. Negotiations that will take place must of necessity be lengthy.
At least a year - possibly two - will elapse before all the difficulties are ironed out. When Britain ultimately joins the Common Market it is axiomatic that our export industries will be affected, in the short term, badly. But in the long term Britain’s entry could have a beneficial effect on our export industries. The Government’s duty is clear. The Prime Minister (Mr. Menzies) has explained beyond all doubt the Government’s attitude. He said -
The first duty of an Australian government - and it will be carried out by my Government - is to defend the interests of our own industries and preserve the future of our own country.
I cannot see anything in that statement with which even the most violent Opposition senators would quarrel.
– We are not violent.
– Well, temporarily violent. Australia’s opinion must have some effect on Britain’s decision. The weight of the opinion of Commonwealth countries will, as Mr. Macmillan said, undoubtedly be given consideration. I do not think we should unduly attempt to handicap Britain’s negotiations, but at the same time we must try to ask for such reasonable concessions as will protect our industries and at the same time give Britain access to the markets that she seeks.
In 1960, Australia was the greatest market for British goods outside the United States of America. Britain sold three times as much to Commonwealth countries as she sold to the member countries of The Six, who comprise the Common Market. The Commonwealth countries have been a much more important market to Britain than the market of The Six. That fact must weigh with the British Government when it makes its decision. But nobody can deny the big appeal of open access to 250,000,000 people, with no trade barriers. From the point of view of British manufacturers, it may well be that they will be able to compete with the United States of America. It may be hoped that some co-operation will be forthcoming from West Germany - that country whose resurrection Phoenix-like from the ashes of the war has been one of the miracles of this century. It is ironic that West Germany, having lost the war, is better equipped with modern factories, modern plant and machinery and modern techniques than Britain, which shared in the victory.
– So is Japan.
– In relation to some products, yes.
– The losers win.
– That is one of the ironies of the situation as we face it to-day. We must look for new and extensive markets. As Senator Laught has so often said in this chamber, extensive markets must be available to us in the countries of South America, which in the past have been almost a closed economic book to Australia. In South-East Asia some markets must be open to us, but not the endless number that some people claim to see there. Our trade must be with reliable trade partners. I do not believe in the starry-eyed nonsense about building trade with Communist countries. As their top theoretician Levua said, Communist countries use trade as a political weapon. The Communist countries do not enter into commercial relations with other countries for the sake of promoting goodwill or for the sake of mutual benefit.
– Do we?
– In some cases, yes. In many instances we have entered into trade relations of a nature that was disadvantageous to us. We have done so on humanitarian grounds. I think the honorable senator will know the instances to which I am referring. A Labour government was responsible for that and I give it credit for what it did.
The trade that so many people profess to see available to us in red China is, I think, a mirage and could be a source of disillusionment and embarrassment. We have had certain wheat transactions with red China in the past twelve months. I do not propose to refer to them now, but I submit that we cannot rely on Communist trade contracts, Communist trade agreements and Communist trade undertakings, because they are founded on sand.
– On quicksand.
– That is so; on quicksand.
– That is Liberal policy.
– It may very well be Liberal policy. I do not challenge that for a moment. Honorable senators oppo site do not know any better than to urge trade with red China, despite the examples that they have been given of what happened when Burma traded with red China. I do not know how often I must cite this example for the benefit of my friends opposite. The Senate will recall how Burma, a bit starryeyed and wanting a market in which to sell her rice, sold it to red China in exchange for cement and some cash. All of us know how Burma delivered the rice and how red China delivered the cement, which had already gone hard and had become unusable. Red China never paid the cash. To add insult to injury, red China ultimately sold Burma’s rice to Ceylon - one of Burma’s markets. That is the kind of thing with which we must be ready to cope if we sup with the Devil. We should recall the experiences of Malaya - not quite as catastrophic in that case - Thailand, Ceylon and, from a political point of view, Japan. Japan, which held extensive contracts with red China, was told that unless a government approved by red China was elected - unless Japan got rid of the Kishi Government - the trade contracts would be cancelled. That happened two and a half years ago. The Japanese decided to elect their own government. The trade contracts were cancelled with a view to causing the Kishi Government a maximum of embarrassment.
– We should try that here. We might move this Government.
– Even Senator Ormonde would not be happy to have another country - I do not care what country it is - telling us that unless we got rid of the Liberal Government and elected a Labour government, it would not tradewith us.
– We would have alook at the idea.
– I do not think the Labour Party would accept the Treasury bench on those conditions.
– Senator, are you not lecturing the Australian Wheat Board rather than the Opposition?
– I include the Australian Wheat Board in my strictures. I thought I made that point clear during the last eight or nine months.
– There are several points that you have not made f’ear.
– I .thought that point would be beyond question. We must recognize that some of the side effects of Britain’s entry into the Common Market will be of such a nature that one would not normally have looked for them. For example, I can envisage that the political partition of Ireland may be eliminated. Eire has announced that if Britain joins the Common Market, she also will apply to join because at the moment such a large quantity of Britain’s food comes from Eire. It may be that the effects of a predominantly economic instrument such as the Common Market will bring about a solution of an old historical grudge which all political arrangements for the past few centuries have been unable to settle. Perhaps the Common Market will help to blot out a great historical crime which, as my friend Senator Vincent would say, that scoundrel Cromwell did so much to perpetuate.
– by leave - The Minister for Customs and Excise (Senator Henty), who spoke after me on last Thursday week, 17th August, in this debate, said -
The Leader of the Opposition in another place, Mr. Calwell, made the same charge that Senator McKenna made. Mr. Calwell said that the Prime Minister had never brought this matter to the attention of the Parliament until the other day. Mr. Calwell at least had the grace to apologize to the Prime Minister in the House of Representatives this morning and say that his information was wrong. If honorable senators; care to turn to “Hansard” of 13th August, 1959, for the House of Representatives, page 186, they will see that the Prime Minister discussed this matter in the House of Representatives. If they turn to page 200 they wilt see that Mr. Calwell replied to the Prime Minister’s statement. Mr. Calwell, as I have said’, has had the grace to correct this morning the statement that he made. Knowing Senator McKenna as I do, I have no doubt that when he is convinced as Mr. Calwell is, he, too, will apologize.
That concludes the reference that I wish to make to the Minister’s speech. I continue under my own power now and say that what Mr. Calwell said on Wednesday, 16th August, was that it was not until the Prime Minister (Mr. Menzies)’ said quite recently that two years ago he had interviewed General de Gaulle and Herr
Adenauer that we knew he had taken any interest in the matter of the European Common Market. Mr. Calwell went on to say that the Prime Minister had never reported to the Parliament the fact that he had visited General de Gaulle or Herr Adenauer and he never mentioned it to the Australian people. The following day Mr. Calwell acknowledged that the Prime Minister had reported interviewing those gentlemen and Mr. Calwell expressed regret for his mistake.
Last Thursday week, after quoting references in the Governor-General’s Speeches over the years from 1957 to 1961, both inclusive, I said -
Will somebody tell me when, during the whole of that period, a major speech was delivered on this matter or a major debate initiated by the Government of this country?
There is no connexion whatsoever between Mr. “ Calwell’s statement and mine. The Prime Minister’s statement, to which Senator Henty referred, was one on foreign affairs on 13th August, 1959, in the course of which his only reference to the European Common Market was the fact that he had discussed with Herr Adenauer and General de Gaulle the need for drawing the seven countries of the European Free Trade Association into association with the European Common Market. There was not the slightest reference to the possibility of Australia’s interests being affected through the development of either of those bodies.
The reference to the European Common Market was so fleeting that it is not even recorded in the “ Hansard “ index either under the name of the Prime Minister or under “ European Common Market “. That is how Mr. Calwell was misled. In my speech I acknowledged the contribution of the Treasurer (Mr. Harold Holt) of 10th November, 1959.
It only remains for me to say that instead of tendering the apology for which Senator Henty called, I repeat with emphasis the question that I asked on 17th August -
Will somebody tell me when, during the whole of that period.-
That is from March, 1957, to March, 1961- . . a major speech was delivered on this matter or a major debate initiated by the- Government of this country?
– by leave - Mr. Deputy President, Senator McKenna, in his speech to which he has just referred, asked two questions which he has now repeated to the Senate. However, he failed to quote the really relevant passage to which I referred. On page 70 of “ Hansard “ of 17th August Senator McKenna said -
The only reference to this matter was made in the speech of the Treasurer (Mr. Harold Holt; on 10th November, 1959, after his return from abroad.
I directed Senator McKenna’s attention to the fact that that was entirely wrong and that the Prime Minister (Mr. Menzies) had made a reference to the Common Market and his visit to Herr Adenauer on page 186 of the “Hansard” for the House of Representatives of 13th August, 1959, to which the honorable senator has referred. That was the statement to which I was referring when I said thai 1 felt Senator McKenna, if he was convinced, would take the same step as Mr. Calwell took in another place. Mr. Calwell said -
Last evening, when I was speaking during the debate on the motion of the Prime Minister concerning the European Common Market, I said that the Prime Minister had not reported to the Parliament on certain negotiations that he had conducted abroad. I found out subsequently that I was mistaken, and that he had made a report to the Parliament. I made a mistake. It was an honest mistake and I regret it.
Those were Mr. Calwell’s words. Mr. Deputy President, Mr. Calwell is the Leader of the Australian Labour Party and as, apparently, Senator McKenna is not convinced and does not wish to apologize, on behalf of the honorable senators on this side of the chamber I am prepared to accept his leader’s apology.
– Mr. Deputy President, I was interested in the speech made by Senator Hannan. I expected this debate to be varied, but not quite so varied as Senator Hannan made it. I agree with some of the statements that he made, but I think he would have done better had he approached mis economic problem on a rather different Basis. He must have listened to what Moscow radio said, and then said the opposite. I suggest that that is not a very solid approach to economic matters. I make the suggestion to Senator Hannan, because he is equally interested in the problem of communism, that it is also the completely wrong way to handle communism, that is, to wait for the Communists to make a move and then do the opposite.
One would expect this debate to be varied because we are dealing with a situation that has not yet occurred. This is an occasion on which we are required to have foresight instead of hindsight. Of course, it is much easier to have the former than the latter.
– No, it is not.
– It is much easier to have hindsight than to have foresight.
– That is right.
– I do not think 1 would have entered the debate at this late stage if it had not been for the amazing speech made by the Minister for National Development (Senator Spooner) when he intervened in order to reply to the amendment moved by the Leader of the Opposition (Senator McKenna). Senator Spooner commenced by saying that the whole of Senator McKenna’s speech proceeded on a basically incorrect assumption. He quoted this statement made by Senator McKenna -
I make bold to say . . . that Great Britain will go into the Common Market regardless of what the terms of admission may be. I think Britain must do that.
Senator Spooner said that was a basically wrong assumption. If it is, and if Senator Spooner is correct, all I ask the Senate is this: What are we talking about? If it is basically wrong to assume that Great Britain will enter the Common Market, I suggest that it would have been better had we never started this debate.
– That was not the point. Senator Spooner did not say anything about that. He was talking about Great Britain entering without any conditions being applied. That was the position, was it not?
– I think you have misquoted people enough for one day. 1 repeat that Senator Spooner said that this was what Senator McKenna said -
I make bold to say . . . that Great Britain will go into the Common Market regardless of what the terms of admission may be. 1 think Britain must do that. 1 am saying that if we do not. make an assumption such as that this debate should never have taken place.
I suggest that Senator Spooner’s approach to this problem was a narrow one. He spoke about Senator McKenna dealing with other economic questions and asked: “ What have they got to do with the Common Market? “ If one examines the whole of Senator Spooner’s speech one finds this narrow approach, with which I will deal in a few minutes. He said that this is a narrow question and we have nothing to worry about whether or not Britain intends to join the Common Market. He said that if she does Australia may have to go through one or two minor adjustments. His view was not shared even by my friend, Senator Hannan. Fortunately, it was not shared by the Prime Minister, who said that this action would be the greatest event in his lifetime. It was not shared by Mr. McEwen, who said that this course would cause the whole economic structure of the free world to topple. I do not think that any doubt about it is left. It is beyond question that this Government has been dilatory in its approach to the matter up to this moment. Good will come out of this debate if only the Government recognizes its mistake, as the United Kingdom recognized her mistake, and at this late stage attempts to do something about it.
The inevitability of the United Kingdom’s move was clear to anybody who had the time or the mind to think about it over the last few years, and not only over the last few months. Never has such a vital decision been received with less surprise in Australia by everybody except Senator Spooner and the Government. Because of my amazement at Senator Spooner’s attitude and my alarm that any member of the Cabinet could adopt that attitude, I wish to repeat some of the things that are almost trite, and that should have been learned by rote before the debate started, so that there would be no need to refer to them again. Senator Spooner’s approach and Mr. McEwen’s approach were to try to keep the United Kingdom out of the European sphere because of the impact of her entry upon us. This is a question of priorities and of taking a broad view. It is of tremendous importance that the United Kingdom, a European power, should take part in the affairs of the
Common Market, which is a European conception. If she does, it will be a very good thing for the whole world and ultimately, probably, for Australia. Let us not underestimate the impact upon us. As Mr. Menzies said, it will be the greatest thing in his lifetime.
What the United Kingdom failed to recognize, and what I think conservative thought throughout the world failed to recognize, was that this miracle was possible. I believe that the European Common Market is a miracle of our time. As Senator Hannan said, Europe has been the cockpit of the world. Events in Europe in this generation and recent generations have caused more death, misery and worry than any other happenings in our lifetime. It is a miracle to see France and Germany united economically as a result of this arrangement, and militarily through the North Atlantic Treaty Organization. That has been made possible by the most hopeful sign of modern times, the improved outlook of men after two world wars. Many years ago, I read in the Treaty of Versailles a provision relating to the transfer of a number of milch cows from Germany to some of the conquering nations. I was a very young lad then, but the thought struck me that if this basic commodity, milk, had to be sent away from Germany, it did not bode well for the coming generation of German children. Nothing produces more bitterness and hatred in the minds of people than the suffering of their children, particularly in smaller countries, where these problems are very much to the fore. To some extent, the provisions of the Treaty of Versailles led to the problems that arose many years later.
After the Second World War, we took a different view. While we insisted that the war criminals be punished, we said that the innocent victims of their politics should not suffer. We tried to build up the defeated countries. First, there was Marshall Aid, which was backed by the generosity of the American people. The Americans, who saw the positive results of their endeavours, are now urging the United Kingdom to join the European Economic Community, which is known as The Six. Conservative thinkers could not appreciate that this would happen. They were living in the past, and did not believe that the new order could work. Now they are faced with the fact that the new order does work. There were doubts and hesitation arising out of the United Kingdom’s traditional insularity, and also because of the probable effect upon the Commonwealth of Nations. These considerations led to the prime error of the United Kingdom in standing aloof several years ago. Now these attitudes have changed. The miracle is here to stay. The Common Market countries have enjoyed greater growth than the United States of America or the United Kingdom. No one can deny that. The results of the union have now moved from the realms of conjecture into the realms of fact. This has helped to break down the barrier of insularity.
The only remaining consideration is the ties of the Commonwealth, but pressure is being put upon the United Kingdom. After ten years of conservative government, she has a very poor record of expansion, culminating in the deflationary measures taken only recently. Senator Spooner said that these economic measures had nothing to do with the Common Market. In the near future we shall be affected as the United Kingdom’s deflationary measures take effect, even if she does not join the Common Market. A good feature is that the United Kingdom is now admitting her error. If she moves into the European Common Market, both the Common Market and the United Kingdom will be stronger, in spite of all the problems of adjustment. If we can get into this problem area, the European theatre, if we can strengthen it and strengthen the United Kingdom, it will be ultimately to the great benefit of the whole world, including Australia.
Senator Spooner was waving the flag very vigorously in this debate a few days ago. We must recognize that the United Kingdom of to-day can never be the United Kingdom of old. Surely that was demonstrated in the Second World War. There was a time when it was true to say that she dominated world trade and world thought and was the leader in world politics and colonialism. That day has passed. I do not think that anybody should try to fool himself that it will ever come again, especially in our generation. If we can strengthen the European theatre, where there has been so much strife in the past, it will be a major achievement.
It may well be that the United Kingdom’s entry into the European Common Market could be the one thing that will produce peace. After all, when Australian soldiers have had to march, it was not because of anything that happened in this our own vicinity, but because of something that had happened in Europe. If world peace is produced by this association of European countries, any re-adjustment that Australia has to go through will be well worth while. Even if world peace is not achieved, the United Kingdom will be a stronger entity when amalgamated with the European Common Market than she would be if she remained outside. There is no doubt that the Western alliance must be strengthened by the United Kingdom’s joining with The Six. As one Labour member of the House of Commons said, the United Kingdom’s frontier now would not be the cliffs of Dover; it would be the Brandenburg Gate.
I have rather hurried over my first point, because much of what I have said was trite and very obvious. I would not have said it if I had not been alarmed at Senator Spooner’s narrow attitude towards the problem. We must face the situation that if the United Kingdom does join the European Common Market, as I think she will, it will be a happening of the greatest significance to Australia. Senator Spooner did not seem to think that this was so. He said that Senator McKenna was wrong in assuming that the United Kingdom would join, irrespective of what she was able to achieve by her negotiations. That is the only attitude that she can take. I think that every Australian - and certainly every member of the Government - ought to be assuming that Britain, if she accepts membership, will accept it as a full member, that she will accept all the responsibilities and all the privileges that go with that membership. If some marginal notes are written into the agreement that will benefit Australia, New Zealand and other Commonwealth countries, so much the better. If that happens, let us accept it as we would manna from Heaven, but do not let us rely on it at this stage!
Senator Spooner said, in effect: “What have we to worry about? Eighty-five per cent, of our trade is in wool, and that is already protected. Why worry about the other 15 per cent, that is going into that area? Great Britain will be there pitching for us, to see to the best of her ability that we are protected.” That is the most dangerous approach to the matter that I can think of. Senator Spooner does not grasp the point that it is not merely a few dried fruits or a couple of bags of wheat that are involved. This development could shatter the whole of Australia’s economy as we know it to-day. It could mean the re-orientation of our export trade, our imports, our balance of payments and our standard of living.
I wish to goodness that Senator Spooner would have a look at the articles that have been written by Mr. McEwen, a fellow Minister, whose view was that the economy of the whole of the free world could be shattered by this development. At the same time, he admitted the value of Britain’s becoming a member of the Common Market. Senator Spooner and others seem to be taking some solace from the fact that as yet The Six have not written their agricultural policy. That is very nice but, after all, what is the concept of this market? It is a concept of protecting the six countries that are already in it. Senator Hannan wonders why Luxembourg has the right to veto the entry of Britain. It is because Luxembourg is already a member of the partnership. When partners in a business are thinking of taking somebody else into the firm, a person who is already a member of it, irrespective of his financial circumstances, is the person who has power of veto - not the person outside.
Senator Spooner airily dismisses the question of 15 per cent, of our exports, valued at nearly £200,000,000, ceasing to go to that Common Market area. About threequarters of those goods go to Great Britain. In other words, a substantial amount of our goods exported is sold to Great Britain. If that trade is damaged, it will be a serious matter for us. It absolutely amazes me that Senator Spooner adopts a complacent attitude to this subject. We cannot underestimate the danger of this development to the trade of Australia. This Common Market has been created for The Six and therefore they are not worrying in the least about any one else. The only agricultural products that they will import will be things that they cannot grow. It is going to be as simple as that. When they start to import the items they cannot grow themselves, their agricultural standards and methods, husbandry and all that sort of thing will be reviewed and greatly improved. They vary throughout the six countries, but those things, broadly speaking, can be improved immeasurably. I exclude Britain largely from that observation. Once those countries start to import only the things they require, obviously the market will be highly competitive. They may impose high tariffs and quotas. They will use the system of import control.
It seems to me that the six Common Market countries, which have become great and are going to be greater, are using the very weapon that this Government has scorned and thrown to one side. The Government has abandoned import controls and the rest. What can be done about this? Let us turn to Senator Spooner’s speech in order to ascertain his attitude to the matter. He said: “After all, there are another twelve or fourteen years. What is all the panic about? “ In twelve’ or fourteen years’ time, the scramble for foreign markets will be at its top, and the position will be aggravated by any happening such as the one we are discussing. The fight for new markets will be keener. Australia is not the only country in the world that realizes what the position will be at the end of that time. After all, a period of twelve or fourteen years is almost nothing in the history of a nation. Senator Spooner’s attitude can be expressed in this way: “ What have we to worry about? This is a problem for posterity.”
The question of new markets is a very interesting one. As I understand the position - I would like one of the Ministers to tell me if this is not the case - we were hunting for new markets even before the Common Market considerations arose. Due to the expansion that is taking place in our country and which is being forced on by immigration, we have to look for additional export markets. The establishment of the European Common Market will aggravate our problems. In looking for new markets, we shall be going to a highly competitive field. This will not be new to us, because already we need new markets. Again, we encounter this narrow approach, namely, that the solution is to be found in an increase of exports. The moment our exports are hit as hard as I think they will be hit, our imports will suffer. It is trite to say that if we cannot export, we cannot import; but if that happens, our overseas balances will come under fire once again and our imports will be in trouble. This only underlines this Government’s folly in dropping import controls. The Government should have known that our exports looked like being hit again by the situation we are discussing to-day.
Senator Hannan touched very briefly on the Asian market. To-day, about 25 per cent, of our exports go to Asian markets. This export trade has doubled in the last ten years, due largely to the rapid emergence of Japan in that period. She has become a good buyer of our raw materials, particularly wool. But when we look at the other side of the picture, we find that our exports to Asian countries during that period have dropped by about 2 per cent., so we are not doing so well in that area. Japan will continue to provide a market for us because of her rapid expansion. She seems to know where she is going so far as production and the restraint of inflationary tendencies are concerned.
Time and time again I have referred in this place to the Asian market or the Asian area, according to the nature of the debates. The big problem, of course, concerns the balance of payments. Generally speaking, the problem of Asian countries has been rapidly to build up their standards of living. They have to import machinery and equipment of the kind that Australia does not export. They have been trying to sell their goods on a falling commodity market overseas. Those countries have not very much money left with which to buy the type of thing that Australia has to sell. Australia has to face up to this situation, and none of the Ministers has directed his attention to it. The subject was touched on by Senator Hannan when referring to Communist China. Are you going to have faith in those countries, as evidently the Australian Wheat Board has faith in Communist China, and give them credits to enable them to buy our goods? I should be most interested to hear one of the Ministers in the Senate address himself to that aspect, but I am afraid that, having regard to the dilatory approach of the Government to this matter, I shall not have that opportunity. Doubtless the Government will not face the need to increase our markets in that area until the Canadians, the French, or some other people have moved in there.
It is true, as Senator Hannan has said, that when we are dealing with Communist China, or with any of the other Communist bloc countries, there are overtones of politics. We have seen how the Communist countries have bought up supplies of less important commodities, such as tin and whale oil, for the purpose of stockpiling them and later dumping them on the markets of the world. We are gaining some experience of trading with Communist countries by selling our wheat to Communist China. It is important that we should not underrate that country. A nation of 600,000,000 people must surely provide a great market.
I break away from that angle, Mr. Acting Deputy President, and return to the theme of my speech, which relates to the narrowness of Senator Spooner’s comments and his attitude that the only thing that counts is the effect on our economy that Great Britain’s joining of the Common Market may have. I was amazed when he was berating Senator McKenna, with scorn almost dripping from his words, because Senator McKenna had dealt with the other economic questions involved in this matter, questions which are so important to Australia. Senator McKenna, in dealing with the whole economic question instead of taking a narrow approach, and referring to the possibility of a re-orientation of our economy, stated -
We produce one commodity in which we have almost a monopoly. Why do we not export products manufactured from wool? Why do we not manufacture those products in our country? Why do we permit overseas companies to come to this country to establish industries and deny local concerns an opportunity to export? I am not suggesting that we should breach any contractual arrangements that have been made, but surely the Government, in this emergency, should say. in effect, to overseas concerns, “ You can bring your capital in, but you cannot take away from local firms the opportunity to export in future “.
Later in his speech, he said -
As Senator O’Byrne asks, should we be content to stand by and let foreign corporations take charge of our raw products such as bauxite?
Should we let them take over our vast aluminium industry and export our products when we should be using those products to provide employment opportunities in this country?
Of course, I sympathize with Senator Spooner for getting a little touchy when the subject of bauxite is mentioned. Time and again when we have been debating that subject in this chamber, as we did a few months ago, we have not been able to ascertain from him the terms of the contract entered into for the sale of the aluminium industry. We have, however, ascertained that the Government has committed the unpardonable and stupid error of permitting overseas interests to obtain control of bauxite deposits that are among the richest in the world. The Government has said to them, in effect, “ You do not have to do anything about it for a period of years”. The Government has not even told them that they must engage in aluminium production.
Far from matters of that kind having nothing to do with the effect of Great Britain’s entry into the European Common Market, I say that they have a great dea to do with it. The results of her entry will be so widespread that we shall fine that every pennyworth of export trade that we can build up, to replace the damage that may be done, and almost undoubtedly will be done, to our primary industries will be valuable. What is wrong with making Australia a manufacturing country? The Government, in imposing the controls which it put into effect last November, has said in effect that Australia is not a manufacturing country, and that even if it is so to a degree, it should not be manufacturing such things as textiles. It has allowed the aluminium industry to be tied up for many years to come. All that the overseas interests need to do is to dig a bit of bauxite out of the ground and ship it to New Zealand, where the manufacturing processes are to take place. 1 contend, Sir, that the Opposition’s charge against the Government has been completely borne out. I fail to see how any one could argue successfully that the approach of the Government to the possibility that Great Britain might join the European Common Market, has not been a dilatory one. Senator Spooner’s speech typified the attitude of this Government, which has sat back and said: “ Why worry? Only 15 per cent, of our exports are involved, anyhow, and Great Britain will be able to look after that.” Such an attitude entirely ignores the fact that the main consideration is a political one. As we know, political considerations have played a prominent part in European countries for a very long time. The Minister for Trade (Mr. McEwen), while admitting that the Common Market is of tremendous significance for Great Britain, would like to see Great Britain remain out of the European zone because her entry into it might shatter the economies of other Commonwealth countries and their trade relationships with Great Britain. I suggest that that is an unreal attitude to adopt. Great Britain is a* European power, and her contribution to the world must be made as such.
The question of the inflow of overseas capital to this country, to which Senator McKenna referred, will have to be faced in the immediate future. We have seen in the past how capitalists have gone into Asian countries, denuded them of their wealth and given very little in return. We do not face that exact situation, but nevertheless there is the possibility that our natural resources will be wasted during the next 50, 100, or even 200 years, which is not a very long time in a nation’s lifetime, with very little benefit to the people of Australia. Capital comes to this country from overseas because the investors see attractive possibilities. The Government of Australia has every right to stipulate the conditions on which our natural resources may be exploited. Does Senator Spooner challenge Senator McKenna’s statement that we should not allow overseas companies to take away from local firms the opportunity to export?
There is no doubt whatever that Great Britain’s decision to join the European Common Market will have a considerable bearing on European trade and, consequently, also on Australian trade. It may have a most momentous impact on the Australian economy. If, at this late stage, we can get that idea into the Governments head, we may induce it to act for the good of the Australian people.
– The Senate has spent some time in discussing the results for Australia of Great Britain’s decision to join the European Common Market. To my knowledge, no member of the Commonwealth Government has: ever indicated that she should not take that step.. In point of fact, the Prime Minister (Mr. Menzies), when delivering his statement in the House of Representatives recently, stated -
Great Britain herself has, of course, enormous interests at stake. Her decision to negotiate could not have been easy, and we may be sure that it has been arrived at in the light of her immense experience and ripe judgment. It would not be for us to substitute some- opinion of our own, even if we had formed one. For we are in no position to assess the elements .in the British economy, or the economic arguments this way and that concerning the effect upon her of an achieved membership. ‘
The Commonwealth Government has not exerted any influence to prevent Great Britain from joining the Common Market, but it is proper that this- National Parliament should concern itself with the implications of that step for Australia.
We could not view with equanimity the effect, at its worst, that Britain’s decision might have on our traditional market in the Mother Country, a market that we have exploited ever since we have been a nation. When I say “ at its worst “, I mean the effect that could result should this confederation, as Senator Wright has called it, impose import licensing, erect a high tariff barrier and, in effect, invoke protection against imports from Australia and other Commonwealth countries. Should that happen, we would see the incidence of the European Common Market at its worse. Other Commonwealth countries would be affected also. The impact upon the Dominion of New Zealand would be very much worse than the impact on Australia. I think of prohibitive tariffs against butter, frozen meat and other things upon which New Zealand is so entirely dependent.
What happens will depend upon the outlook of the people in charge of the Common Market countries. If they adopt what might be termed a little European attitude, and if, in effect, they seal off what is one of the most populous and productive areas in the free world, that will be a bad thing. If they take the view that they must prevent the importation from the rest of the free world of anything they can produce themselves, that, in my humble opinion, will not be a good thing for the free world. The outcome seems to me to depend entirely upon the attitude of mind of Europe itself. Therefore, there seems to me to be tremendous force in the contention advanced by Mr. Macmillan that Britain’s influence would be greater within the European Economic Community - that it could use that influence to better effect within the community than if it remained aloof and stood outside the confederation.
Great Britain is a country that has always had a concern for the rest of the world. She has never been parochial. She has done more to uplift under-developed countries than any other nation in the world. It seems to me that it would be a good thing if she were in the conclave of the seven or more nations which will comprise this economic bloc. Britain’s influence, which has been so beneficial to the free world in the past, should be exerted through the avenue of the European Economic Community for the benefit of the rest of us.
I believe it is vital to the countries outside this economic bloc that the avenues of trade be kept as open as possible. The under-developed countries - as Mr. McEwen described them - or the non-committed countries should have access, as far as possible, to the markets of the world. If the confederation in Europe adopts a policy which, in effect, very largely seals off the European bloc, the repercussions to the rest of the nations outside the Soviet orbit, which will not be able to export their surplus production, will be exceptionally detrimental. Honorable senators should make no mistake about that.
In the matter of erecting trade barriers, Australia is not lily-white herself. Members of Parliament and producers have again and again advocated the raising of a tariff barrier against imports from other countries despite the fact that those other countries suffer under the handicap of having to send their goods half-way round the world. Our producers are not- prepared to compete with imported goods in the local market, even under fair conditions. I repeat that in this matter we are not lily-white ourselves. If the European bloc adopts the same attitude - let us hope it will not - it will not be a good thing for the Commonwealth countries.
We have spent a lot of time in discussing the pros and cons of marketing. We have considered - and rightly so - what would be the position if the European Common Market operated against us at its worst. It is proper that we should discuss that aspect of the matter and consider what could be done to counteract such a position. But what has impressed me is that in the forefront of the speeches of the Prime Minister of Great Britain, Mr. Macmillan, has been the idea that this economic union could become a political union which would be a bastion for the free world. Our own Prime Minister, in another place, also referred to that aspect. It’ is an important aspect. It is so important in its implications that it could easily transcend the importance of markets to this country. The world to-day is threatened with a barbarism unparalleled in history - a barbarism that will not stop and from which there is no chance of resurrection once a country becomes submerged in it. It is a barbarism that practices the art of genocide and which was responsible for the death of 15,000,000 Ukrainians and millions of Tibetans. It has done the same thing in Hungary. As the Prime Minister so aptly said, it pulls down countries with old civilizations - countries which are advanced and highly developed. It .pulls them down to such an extent that there is no chance of resurrection. If the ideal which Mr. Macmillan envisaged be brought to realization and the European confederation can become a bastion against the barbarism which threatens the world, it will be something well worth while.
I turn aside for a moment to draw a comparison. It is strange - perhaps it is not strange really - how history repeats itself. I call to mind that Napoleon, during the first of his wars, induced people to believe that he was carrying the principles of the French revolution - liberty, equality and fraternity - into the other countries of Europe. He led people to believe that he was performing a humanitarian work and, of course, they followed him. Eventually they awakened to the fact that this same Napoleon was more imperialistic than were the imperialists.
The same can be said of Hitler. He cluttered up his “ ism “ with socialism; he called his party the National Socialist Party of Germany. He purported to be doing something for the common man. He claimed that his “ ism “ was some brand of socialism which would uplift all sections of the community, whereas in actual fact he was getting ready for the worst war in history. The same is true of the Soviets. They call themselves the Union of Soviet Socialist Republics, whereas in fact they are practising a kind of state capitalism that lends itself to the worst tyranny that man has ever known. There the government is the sole employer, the sole law-maker, the sole judge and everything else.
– And the executioner.
– That is so. We hear of the dictatorship of the proletariat. The proletariat has no more say in the government of Russia than I have. We hear of people’s democracies. Could there be a greater misnomer? The people to whom 1 have referred go about proclaiming with great vehemence the very reverse of the truth. As Mr. Macmillan has pointed out, as Senator Fulbright, I think it was, in the United States has pointed out, and as has been pointed out by Mr. Menzies, the European Economic Community could develop into a bastion to defend the free world against what I repeat - so many people are duped by it - is the greatest form of barbarism in history. If the European Economic Community could become such a bastion, Britain’s entry would be well worth while and the sacrifices that we would have to make would be worth while also.
Great Britain has a lot of problems. In my humble opinion, a tremendous number of pros and cons must be weighed before the United Kingdom finally decides to enter the Common Market. Not the least of them is the fact that she sells 42 per cent, of her exportable products to Commonwealth countries and approximately 14 per cent to the six nations which already are members of the Common Market. It would seem, therefore, that if Great Britain entered the Common Market and if there were a common tariff barrier around all seven member nations, she would be up against very strong competition, particularly from West Germany, Italy and France.
The records show that since the last war production on the continent of Europe has outstripped that in the Mother Country. I believe that is due to the fact that Britain has been troubled by the same bug as that which has troubled us in Australia - cost inflation. Britain has been continually forced to adopt measures similar to those which this Government has been compelled to adopt in an effort to rectify the situation. Cost inflation has made it much more difficult for the Mother Country to export her products, just as it has made it difficult for this country to do likewise. Full credit was given by Senator McKenna to the six countries which are already members of the Common Market for the great boost in production. But I have taken a lot of interest in a report of what was known as the Organization for European Economic Cooperation.
– You mean the European Economic Community.
– No, I do not. I am referring to the period before that organisation came into existence.
– That was long before.
– The honorable sena tor must have had his spectacles on the wrong way. The journal from which I obtained my information pointed out that following 1948 production in Western Europe had grown as it had never .grown before in peace-time. Tt was pointed out that the gross product per person had risen bv more than 40 per cent, as against less than 25 per cent, in the United States of America and Canada and that car ownership had risen by 53 per cent, in the previous four years.
– May I ask whether you have the details?
– I will be able to show it to you afterwards. I point out for the benefit of Senator Hendrickson, who said that production in Soviet Russia had far outstripped that in Western Europe, that this journal from which I am quoting stated that the steel industry in Russia - I think the Soviet had a five-year plan - projected an increase of 4.8 per cent, but that that increase was not attained. It was further pointed out that steel production in the western countries which com prised this economic bloc to which I have referred rose by almost 9 per cent.
It seems to me that the great experience of the Mother Country in European affairs and world trade, and all these other matters which help to make a stable economy, will be considered. I repeat that if there should be an economic community with a common tariff barrier, it may well be that the Mother Country will experience stiff competition and she may experience difficulty in finding markets for the 42 per cent, of her exports that now go to Commonwealth countries.
– May I ask this question: Why do you not send the Prime Minister, the Minister for Trade and the Treasurer overseas so they can argue these matters before the negotiations are concluded?
The DEPUTY PRESIDENT (Senator the Hon. A. D. Reid).- Order!
– I did not hear that interjection.
– Let me repeat it. Why do you not send the Prime Minister, the Minister for Trade and the Treasurer overseas to argue these points?
The DEPUTY PRESIDENT.- Order! The honorable senator must cease interjecting.
– When we surmise that suddenly our export trade with the United Kingdom will be cut off, I think we are envisaging the position at its worst. It is important for the undeveloped and, as the Minister for Trade (Mr. McEwen) described them, the non-committed countries^
– Fighting Mac!
– I have heard Senator Dittmer for a long time in this chamber. We had in the Tasmanian Parliament a member like Senator Dittmer. Tha[ member would never keep quiet. I had better not repeat in this place the name that we gave to him. If I may continue my speech, it is important for those undeveloped parts of the free world that trade should flow as freely as possible. One thing is certain. If trade does not flow freely the Soviet bloc will cash in on the situation. The Communist countries use trade as a weapon just as they use nearly everything else as a weapon. They used trade as a weapon against Japan, as Senator Hannan pointed out during his speech. The Soviet countries are increasing their exports considerably. That fact was adverted to in the article on overseas trade published by the Minister for Trade. The Communist countries are increasing considerably their imports from countries that are neither in the Communist orbit nor in the orbit of the free world. In some instancies the Communist countries are doubling- and trebling the value of their imports from those countries. No doubt the Communist countries will continue to increase the rate of their imports, because it cannot be denied that a considerable political influence can be exerted by a country that is a valuable customer of another country. That is fundamental.
If the countries that comprise The Six are determined to be a self-contained community and to exclude, as much as possible, trade with the rest of the world, they should remember that Western Europe does not comprise the whole of the free world. It is essential that the undeveloped countries, and those in the process of becoming industrialized, should be able to trade as freely as possible throughout the free world.
– Would you agree that some countries-
– I can hear that parrot again. I think the best course to adopt is to ignore him. I see no merit in the Opposition’s amendment. This Government is right on the ball with respect to the implications involved in Britain’s joining the Common Market. It has been on the ball all the time. Be that as it may, the decision to join the Common Market is one for Britain alone. But it is right and proper for Australia to exert her influence, as she is doing, in order to preserve the trade that we have enjoyed with the Mother Country over the years.
.- Having listened to the speeches from honorable senators opposite I am convinced that the Opposition’s amendment is justified. The amendment calls for a reconsideration of the situation that arises out of Britain’s announcement of her intention to apply for membership of the Com mon Market. The Government should- not arrive at hasty conclusions or decisions. Life in all its phases can succeed only in a state of equilibrium. When relations between individuals and nations become unbalanced you have the origin of most of the troubles with which we are faced to-day. Strikes, revolutions and wars have their origins in unbalanced relationships. Senator Lillico referred to barbarism. We have had barbarism in the world for the last 40-odd years. We have had two world wars, each of which could have been avoided. We have had two major revolutions - one in Russia, in 1917, and the other in China, in 1949. Smaller wars have been almost the order of the day throughout the world.
Look at what is happening in Africa to-day. Not long ago the military slaves of Portugal, acting under orders, massacred between 20,000 and 30,000 people in Angola. The world is living in a state almost of barbarism. Never before in the history of man was there an age when the slaves to the machine produced so much wealth so quickly and so cheaply, but so much in excess of what could be bought with the bare subsistence wage that they received. Never before in the history of man have the slaves of the conscript state been so well trained and so efficiently armed in order to massacre millions of their fellow men. During the two world wars and the intervening period it is estimated that about 100,000,000 people were destroyed. Could anything be worse than that?
The effect of the Common Market will be to reduce trade relations to the lowest common level. I propose to refer to the fifth issue of a publication entitled “ The New Economics “, which is published by a group of professional men who are trying to unravel the present situation. Under the heading “ Commonsense and the Common ‘ Market “, the August issue reads -
National economics throughout the world continue to stumble along from crisis to crisis, and their faulty functioning is now highlighted by the European Common Market with its threatening effect on world trade.
I agree with that statement. The article continues -
The Common Market arises wholly from this setting, and is basically a money-price problem.
The publishers of “ The New Economics “ advocate the appointment of a royal commission to inquire into our monetary system. To my knowledge, a royal commission has been held in England; one has been held in Australia; and one has been held in New Zealand. From my point of view, each of them produced a mass or maze of generalities. I also believe that the origin of the problem is not monetary but economic.
In the May issue of “The New Economics “ these questions were asked: How is it that the cost of production in terms of physical power has never been lower, and how is it that the cost of all things has never been higher? That is the fundamental economic contradiction in practically every country. The cost of production has never been lower for the very obvious reason that labour time is a diminishing factor in production and to the extent that labour time is a diminishing factor the subsistence wage assessed by the Commonwealth Conciliation and Arbitration Commission is also a diminishing factor. This article said that costs have never been lower. I say that costs in terms of labour time have never been lower, which is the same thing.
There is an unbalanced economy. The purchasing power of those who produce the wealth is diminishing whereas it should be increasing in this amazing age of intensified mechanized production. That is responsible for the two extremes which exist in every country - the accumulation of great wealth on the one hand and the increasing poverty of those who create the wealth on the other hand. Take the present position in Melbourne as an example. In that city liquid capital is being converted into colossal palatial buildings of all kinds that are going sky high. Yet in the heart of Melbourne between 30,000 and 40,000 people are living in filthy verminous houses. Those figures have been supplied by an ex-Minister for Housing in the Victorian Government. That is the fundamental position that should be understood. There is no balance in our economy. The people of this country, as of other countries, are irreconcilably class divided. All the troubles to which attention is directed from time to time have their origin in that fundamental anomaly. Yet nothing is being said about it.
The August issue of “The New Economics “ also says -
It stresses what The New Economics insistently proclaims, that the fundamental trouble with every national economy to-day is a shortage of money compared with the legitimate costs and prices of consumable goods on sale.
Goods cost money. Money is only a ticket which enables a person to make a purchase. In my opinion, the fundamental fault is that the owners of land and capital in every country are becoming wealthier and fewer in number and the non-owners, as wage slaves, are being subordinated, exploited and impoverished down to the lowest level as destitute wards of the State.
For example, on the waterfront in the last five years between 3,000 ond 4,000 men have lost their jobs because of mechanization and the men employed on the waterfront now are doing ten times as much work as they did in the past. On the coalfields of New South Wales during the last ten years 8,000 miners have lost their jobs because of mechanization. What has become of those men? The answer is that the number of destitute wards of the State is approximately 750.000 now, whereas in 1949 it was 450,000. In addition, nearly 120,000 people are unemployed. That is the outcome of this fundamental anomaly. It applies to the countries of the Common Market as well as to other countries. “ The New Economics “ goes on to say -
So engrossed have our politicians and economists become with this “export” complex that the irony of the situation is emphasized when they inform us that unless Australia can sell goods overseas our standard of living will decline.
That is not true. If, for reasons best known to themselves, other countries decided not to export goods to Australia or import goods from Australia, we still have unlimited resources with which to raise the present standard of living. The people who are unemployed are able and willing to work and would be working if the Government was sufficiently well informed and courageous enough to tackle the task.
This article says -
The Common Market, as another attempt to overcome the inherent defects of our financial economic system, is bound to fail.
Whether six nations or 60 are banded together, the discrepancy between prices and purchasing power will thwart all efforts which proceed as though the disparity did not exist.
The condition of affairs to which that statement refers exists in every country and particularly in the wealthiest country in the world, the United States of America, where between 5,000,000 and 6,000,000 people are unemployed and there is a pauper population of approximately 30,000,000 coloured and white people. Senator Lillico spoke about barbarism. Is there any barbarism worse than what is being done when millions of men, women and children are practically starving to death alongside mountains of food, yet not one government will attempt to do anything about it? “ The New Economics “ quotes an article by Mr. Anthony Marlowe, Q.C., a judge in the Gestapo war crimes trials after the Second World War, which appeared in the Melbourne “Herald” of the 9th of this month, as follows: -
If Britain joins the Common Market she will lose her national sovereignty: Control over her own political, economic, legal and financial policies, even more than she has lost it by joining the International Monetary Fund and G.A.T.T. She will cease to be a member of the Commonwealth of Nations which may thereby be disrupted.
Britain is being forced into the Common Market because of her financial system which makes her export more than she imports, and the members of the Commonwealth will be forced into a similar loss of National Sovereignty if they persist in the same financial system.
The plain fact is that the Treaty of Rome provides, within the next ten years, for a European parliament and a central administration of the law.
– A European assembly, not a European parliament.
– I am only quoting him. Referring to the ultimate effect, he said -
A couple of years ago the Federal troops of the U.S. had to be put into Alabama because the central Government disagreed with the State policy. The fact that in general we in Britain were in sympathy with the central Government on that occasion is not in point. What matters is this: How would we like it if the troops of the European Government were parachuted into England to tell us how to run our affairs?
That is the effect of the intensified centralization of dominating authority, and that is what it is intended to foster. For all practical purposes, if it is done, this country will be just a satellite state of America or of a body which is international in name but predominantly American in policy.
I conclude by saying that from every point of view the situation is so serious as to justify the carrying of the amendment and the giving of further consideration to the matter. I have never known a time when people were so confused about a state of affairs that had arisen. To-day, there is civil war in Brazil. Why is that? It is because of an unbalanced economy, with the pauperized proletariat, to whom Senator Lillico referred, against central authority.
– In whom authority is not interested, incidentally.
– I know that it is not, because the proletariat is regarded as just so much labour power to be used, if possible, for profit. The attitude is that if the proletariat cannot be used for profit they should be left to starve. The worker has no freedom of access to the means by which he lives. Freedom is in two categories, positive and negative. The wage slave is free to work, provided the employer will allow him to work. He is free to spend his wages as he deems fit, but he has no freedom of access to the means by which he lives. The latter is positive freedom, possessed by the owners of capital and land. In this age, they are becoming wealthier, and fewer in number. It is a question of how long this country and other countries will tolerate the state of affairs that has existed during the last 40 years.
Question put -
That the words proposed to be left out (Senator McKenna’s amendment) be left out.
The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)
Majority . . . . 8
Question so resolved in the negative.
Original question resolved in the affirmative.
Sitting suspended from 5.45 to 8 p.m.
Debate resumed from 15th August (vide page 34), on motion by Senator Paltridge -
That the following papers -
Estimates of Receipts and Expenditure, and Estimates of Expenditure for Additions, New Works and other Services involving Capital Expenditure, for the year ending 30th June, 1962;
The Budget 1961-62 - Papers presented by the Right Honorable Harold Holt in connexion with the Budget of 1961-62;
National Income and Expenditure 1960-61; and
Commonwealth Payments to or for the States- be printed.
– Mr. President, the motion before the Senate is one for the printing of the Estimates and Budget Papers. As a parliamentary form, this is a procedure for which, as on many occasions, I have indicated I have scant respect. However, it does present us with a valuable opportunity at this time to review the Government’s performance during the past year and to criticize the Government’s proposals for the current year. I confine my remarks to-night to those two aspects. I make no apology for not devoting any substantial time, if any at all, to enunciating the Opposition’s policies in relation to major matters - first, because there is not time to do so, having regard to my other two tasks; secondly, our leader, Mr. Calwell, has given some indication of them; and thirdly, the party has put in recent weeks many aspects of policy. Finally, there will be a far more appropriate occasion for announcing to the people of Australia what our policies are.
As I have said, the motion before the Senate is that the Estimates and Budget Papers be printed. To that motion, on behalf of the Opposition, I move -
At end of the motion add the following words: - “ but that the Senate is of opinion that they fail to make adequate provision for Social Service Benefits, especially Child Endowment, and Repatriation Benefits; that they fail to relieve the plight of taxpayers, the family unit, the farming community and other sections of the Australian people and that they make no effective contribution to correcting seriously adverse trends in the Australian economy including unemployment, rising living costs, failure of the public loan market, adverse balance of international payments on current account, high interest rates and inadequate housing.”
I go to the Budget speech of the Treasurer (Mr. Harold Holt) forthwith and 1 lay the foundations for what I have to say by quoting from that speech three very brief passages. The Treasurer said -
To-day the Australian economy is, I believe, basically stronger than it has ever been.
He further said -
We have always stood for full employment and it cannot be denied that, through our long term of office and often under difficult circumstances, we have held very close to that goal. . . We put full employment foremost now in our immediate economic plans.
And the third comment which I use as my base is -
Externally, our situation has greatly improved.
To those three statements I want to add the claims by Government spokesmen in recent times in the press, on television and over the radio that what the Government has done has been to labour to prepare a base from which steady and real progress could be made. I saw the Minister for Labour and National Service (Mr. McMahon), on television the other evening in a debate on the Budget, and I heard him affirm it not once but many times. It seemed to me that the repetition of it was more to assure himself of its accuracy than to convince anybody else.
It is my purpose to review the basis that the Government has established for itself. One does that most conveniently by referring to the Budget papers, and I propose to go to one of the documents that were circulated with the Budget, namely, the very important paper dealing with national income and expenditure, and from that to produce some facts to the Senate which will show the kind of basis deliberately built by this Government as the beginning for an era of progress that the Government foresees. And, of course, if that base is insecure and not sound, the Government is working on bad foundations. 1 believe that the facts I will put will be indisputable, for the reason that I have taken them from the document prepared by the Statistician to which I have referred, and which was presented with the Budget papers to the Parliament by the Treasurer of the Commonwealth. I look first at table A - National Income- and Expenditure - which gives us the broad aspects of the Australian economy throughout the financial year which ended on 30th June last.
First, let me refer to the gross national product, that is, the figure that represents the total of all the goods and services produced in Australia throughout the year. In looking at it, one finds that the gross national product increased by £340,000,000 compared with that of the preceding year. That represented an increase of only 5 per cent, over the previous year. It is not a happy result, because the earlier year showed a rise of 10 per cent, on the preceding one. So the increase of 10 per cent, in the year before last descended last year, under this Government, to a mere 5 per cent. If the 10 per cent, production rate had been maintained, the gross national product for last year would have been an additional £340,000,000.
At the same time as our own Australian production of goods and services was £340,000,000 less than the rate of progress in the previous year might have led us to expect would happen, importations of goods and services were up by £167,000,000 compared with 1959-60. In other words, we produced less last year, we imported more, and thus we lost employment opportunities at home and we boosted the employment opportunities of overseas countries.
That is my first point, and it is not an inspiring picture of “ Australia Unlimited “. The prime cause of it - this is my comment, not the Statistician’s - was the lifting of import controls in 1960. A further cause was the severe credit restrictions and other fiscal measures that were announced by the Government in November, 1960, and later implemented in this Parliament and through banking controls.
The second point that I want to make is that private fixed capital investment increased by 17 per cent, in 1959-60, compared with that of the previous year. That meant an increase of £187,000,000 for the year, providing opportunities for- employment, of course, and yet last year the increase was only £68,000,000, or 5 per cent. That was a decided fall in the rate of expansion of secondary industry in this country. Again, that is not a good base from which to begin - declining activity in the manufacturing industries which are the greatest employers of labour that we have.
The third factor is the matter of unsold stocks. At 30th June last, they were valued at £183,000,000, or nearly twice as much as in the previous year, when unsold stocks represented £100,000,000. That indicates plainly a fall in consumer demand. It may also indicate an undue accumulation of imports, but very plainly it presents a threat to employment, because production is halted while stocks are disposed of. It is true that over recent months many organizations in this country have been keeping their factories going only by the accumulation of stocks. They have been doing that, despite the central bank directive in December last that the banks were not to finance the accumulation of stocks. Many factories have been pushed hard to keep their staffs on and to try to maintain their production. Of course, they have failed, as the figures I have cited indicate.
I turn to the question of personal consumption to see how our people have fared in that respect. The Commonwealth Statistician has given the clearest indication of a decided fall in the consumption of food, drapery, clothing and footwear, all essential things for the people of Australia. In express terms, on page 4 of the White Paper on National Income and Expenditure, the Statistician points out that while personal consumption increased by 6 per cent, in 1960-61, in the previous year it had increased by 10.7 per cent. So that, even on a comparison with the previous year, there was a fall in the rate of consumption in the essential items I have mentioned.
The Statistician goes on to make a very significant comment in relation to food on the one hand, and clothing and other commodities on the other. He points out that the increased expenditure last year on food and clothing did not represent an increase in consumption at all, but merely an increase in prices; so that no greater quantities of food or clothing were consumed last year, although there had been the addition of 200,000 persons to our population. That certainly is not a forward move. It is not a point from which one could hope to inaugurate an era of stability and full employment.
Let me turn to farm income. The table to which I have referred shows that, for the year, the income of the farming community was £467,000,000. Farming, of course, is an activity upon which Australia is heavily dependent. It is essential to the good fortunes of this country and to our standards of living that the farming community should be prosperous. The total amount of farm income that I have mentioned represented a rise of only 3.7 per cent, over 1959-60, but it actually fell by an estimated £5,000,000 in 1960-61. The figure for that year represented £32,000,000 less than in 1953-54 and was only £23,000,000 higher than in 1949-50. In all those years from 1949-50, farm income improved by only £23,000,000.
Honorable senators must remember that, on looking at the consumer price index which, according to the July publication issued by the Commonwealth Statistician, ranges right back to 1949, every £100 in 1949-50 bought goods which to-day would cost £189. So, applying that measuring stick - and it is a proper one to apply - and looking at the £467,000,000 of farm income to-day, it means that the farmers have in real income little more than half of what they had in 1949-50. I put it that that is a tragic position for this country. Yet, that is a part of the base which this Government claims is the proper one from which to erect a structure of national prosperity.
Let us look at the position of our international balance of payments on current account. Again, the White Paper to which I have referred shows that last year we spent £369,000,000 more overseas than we earned overseas on our year’s operations.
That gap was filled only by a fortuitous inflow of capital of a magnitude we had not seen before. That capital came in under very special circumstances, a great deal of it being for investment in the buying of shares in this country, so that it may leave us just as quickly when its suits the investors. I do not propose to develop that theme now. I shall return to it, I hope, before I conclude my remarks. I merely want to present the picture as shown by the Treasurer’s own presentation.
The final matter in the White Paper to which I propose to refer relates to personal savings. The Statistician, in presenting the figures in this respect, has ignored the increase in the assets of marketing authorities and the funds of assurance companies, and he has also ignored the undistributed profits of companies. Ignoring those three factors, he has dealt with other personal savings of the people at large. On looking at the figures, one finds that, for 1960-61, the savings were £60,000,000 less than they were in 1959-60. That is not an optimistic outlook for the country. Little wonder that the other aspect, the condition of our local loan market, to which I shall advert in a moment, is so acute.
Let me leave the White Paper and turn to the Budget itself to complete the picture. There, we learn of the great collapse of our local loan market. Last year, the appropriation for Commonwealth capital works was £141,000,000. State works, including war service land settlement, cost £232,000,000, making the total for the capital works programmes of the Commonwealth and States, £373,000,000. How much did we raise on the local loan market towards that cost? We raised £145,000,000, including borrowings from overseas. The failure last year amounted to £221,000,000. This is the firm base from which, according to the Government, we are to start operating.
For this year, the expected gap is £251,000,000, on the Government’s own Budget statement. The cost of Commonwealth works will rise to £152,000,000 and State works to £242,000,000, so that the total works programme will amount to £394,000,000. The loan market, according to the Treasurer, is expected to yield £165,000,000, so that the failure in the current year will be £229,000,000. But that is not the whole story, because revenue also is used, and so, too, are trust fund resources of the Commonwealth, built out of revenue, to fill the gap caused by the non-conversion of loans falling due. Those sources are used for the redemption of loans that are not converted. The Government expects to find some £22,000,000 from such sources, which means that in this year the loan market will fail by £251,000,000.
Of course, that gap has to be filled by the taxpayers of Australia in the one year, whereas if we had a sound loan market, it could be spread over the taxpayers of the ensuing 53 years. That has not only been a feature of the last two years; it has been so in every single year of the administration of this Government. I have adverted to this fact every year, time and again, throughout that period. The fact is that, for Commonwealth and State works, over the last eleven years the loan market has failed to the unbelievable total of £2,169,000,000. The gap has been filled from the pockets of the people of Australia at the rate of nearly £200,000,000 per annum. That is a part of the base which, the Government has told us, is so sound and so secure. I think that the only occasion on which I have heard any person in a responsible position advert to this in terms that would carry some conviction was when a statement fell from the lips of the Treasurer himself. That was the first time, in my recollection - it may not have been the first time it happened - that a responsible member of the Government adverted to the colossal failure of which I have spoken. So that I may have some outside confirmation of what I put to the Senate, let me read from the speech made by the Treasurer when he was introducing a bill designed, to use his words, to provide taxation incentives and disincentives to draw more money into the loan market from superannuation funds and insurance companies. This statement was made on 23rd March of this year. The Treasurer was referring to a period slightly different from that to which I have referred. He said -
Oven the last ten years, more than 60 per cent, of Commonwealth and State capital works expenditure has had to be financed ultimately from Commonwealth taxation revenue. The total amount supplied from revenue over this period exceeds £2,000,000,000, a heavy burden on this generation of taxpayers for public assets which will, for the most part, be servicing many generations to come.
He added - .
In other words, Commonwealth taxation hai, had to be much higher than would have been necessary had public authorities shared more fairly in community savings, including the large and rapidly growing volume of such savings of which the life companies and the private funds have been the custodians.
Later he said -
In fairness to the general taxpayer, and having regard to the need for a more balanced use of community savings to sustain sound national expansion, the Government reached the conclusion that action to check this drift was necessary.
With vast courage, the Government began in November to do something that Labour had never contemplated, and had never done in the worst emergency, even in the emergency of war. The Treasurer announced that there would be compulsory loans from these bodies. Of course, the Government ran away from that scheme immediately. Like all of the Government’s other economic measures, it was illconsidered. The Government abandoned the measure and very quickly got down to a system of taxation incentives and disincentives. There is the picture. There is another stone in the base upon which the Government is relying.
Let me turn to unemployment, which is a good indication of the state of the economy. I accept the Government’s official figure. I accept that 113,000 people are registered as unemployed. In addition, scores of thousands of people are working part-time and there has been a vast reduction in overtime. All these things are reflected in the gross national product, to which I referred a while ago. Turning to the great manufacturing industries of Australia, we find that a drop of 52,000 in the number of persons employed in factories occurred between June last year and June this year. That is not a sound base from which to begin.
I refer next to the scandal that there has been no increase since 1948 in child endowment for second and later children. Everybody knows that throughout that period from then to now we have had raging inflation and that the value has been racing out of the payment of 10s. for each child down the last twelve years. There has been not one move in the payment for a first child since 1950, when endowment for a first child was introduced by this Government. Who thinks that that is a fandeal for the family units and for the children of Australia?
I wish to refer now to my final point in relation to the Budget. I congratulate the Treasurer on having circulated a very valuable document dealing with the relations of the Commonwealth and the States in the financial field. It gives most valuable information. I am looking at page 28, where the Treasurer acknowledges that throughout the past eleven years the Commonwealth has given assistance to State works programmes to the extent of £865,000,000. On the previous page, he acknowledges that the great bulk of that money - certainly more than £800,000,000 - was taken from revenue. The matter does not end there, however. That money - collected from the taxpayers of Australia and so badly needed by the States for all the intimate services that they provide in the way of schools, roads, power and water conservation - is lent by the Commonwealth Government to the States at interest. This involves the States in an expenditure on interest alone of over £30,000,000 per annum. The States raise this money mostly by indirect taxes, imposed at flat rates. They obtain it from motor registration fees and licence fees of all kinds, spread at even rates over all the population. In short, what is happening under this Government is that the people of the States are being compelled to pay interest on the taxes they have paid. Is that a sound financial base upon which to start off on an era of progress? Is it sound to force up costs in the various States, which provide more intimate services for the people of the nation than does the Commonwealth? The one great item provided by the Commonwealth is social service benefits.
– What is Labour’s policy on this particular matter?
– If the honorable senator had been in the Senate when I commenced he would know why I am not, in the course of this speech, concentrating on Labour’s policy. I have indicated that I am concerned, in speaking to this motion, to deal with the Government’s performance last year and its proposals this year. If I have time after I have done that, perhaps I will deal with Labour’s policy.
I will leave it at that. I have shown the base, according to Government spokesmen, from which we are to progress. It is not a secure base; it is most insecure. I will be told, no doubt, by Government spokesmen that I am an apostle of gloom. I am sure we will hear that. If the picture that I have put before the Senate is a picture of gloom, let me say that it is the picture painted in detail by the Commonwealth Statistician. It is the picture that has been painted by the Treasurer of the Commonwealth himself. It is not my picture. It is a picture painted by the Statistician, relying on facts which cannot be disputed, and a picture painted by the Treasurer.
What has happened is that we have gone backwards so that the Government can claim that we are making progress as we laboriously climb back to the original level. The only justification for claiming that progress has been made is the thought underlined in the old statement that when things are at their worst, they are bound to improve. In that sense, we will make progress. I am not claiming that things are at their worst, but I say that to talk of progress from a position like that, without having the base right in the first instance, is just futile.
We are told also by Government spokesmen that the Budget provides a stimulus to the economy. Let us examine that statement. Only quite recently - within the last few months - the Government set out to restrict spending within the Australian community. A severe credit squeeze was imposed. One of the directives to the banks was to cut down on lending for building construction - the building industry is a key industry - unless the lending had social implications. That triggered off, of course, a regular slump in the building industry and in the scores and scores of ancilliary industries behind it. That was a few months ago. What do Government spokesmen say to-day? They say: “ Will everybody please spend? Will everybody spend normally and dip into his pocket? “ This changing voice of the Government shows very clearly how ill judged, how ill considered and how mistaken were the policies that it adopted in November last.
I have heard the spokesmen of the Government say that it has done wonderful things this year to stimulate the economy. They have pointed out that £21,000,000 more has been paid to the States as income tax reimbursements. That is quite true. But that sum was not determined by this Budget; it was determined in 1959 under a formula agreed upon between the Commonwealth and the States. The Government is merely carrying out an agreement in paying back that sum. The sum so paid varies according to population, average wages, and a betterment factor. It is automatic. Whether there is a depression or inflation - no matter what happens - that sum has to be paid under legislation that has been passed and under an agreement that was settled in 1959. It is not a contribution under this Budget.
– It can repudiate agreements.
– I would not expect that of the Government. The agreement has been made, and I believe it will be honoured. In fact, the Government has honoured it in this particular case. But I flatly contradict any claim that this money is an addition to the funds made available in the Budget to stimulate the economy.
It is true that the Government has provided or supported the provision of another £10,000,000 for the works programmes of the States. But there would be a normal expansion of that activity in any event. The Government has earmarked £5,000,000 of that sum for housing. That is a useful contribution, but it is an exceedingly small one. In other words, with the building of houses greatly restricted as a result of its economic policies, the Government is prepared to make a contribution equivalent to 10s. per head of the Australian population to remedy the situation and to get the home-building industry afloat again. As I said, it is a useful contribution, but it is also an insignificant one.
One thing the Government has done has been to budget for a deficit of £16,000,000. I concede that that would be a contribution to stimulating the economy. But let us look at it in its application to the unemployed. The Government’s own figures indicate that 113,000 persons are unemployed in Australia. If we divide £16,000,000 by 113,000, we get a sum of £143. That is equal to less than £3 per week per head of the present number of unemployed who are registered, ignoring those who are in parttime employment and those in all other categories. One must face up to the fact that that, too, is an insignificant contribution.
The Treasurer claimed in his Budget speech that another stimulus to the economy was provided by an increase of £27,000,000 in the appropriation for social services. The great bulk of that sum- nearly £20,000,000 - is a automatic increase. It flows from the fact that there has been a great increase of the number of beneficiaries with the passing of the year, from the fact that there has been a growth of the population, more children having been born, and from an increase of the number of people moving into the age field. When one examines the Budget, one finds that the new social service proposals will inject only £8,800,000 into the economy this year. The provision for repatriation benefits will inject into the economy only £2,500,000. It is true that the provision for Commonwealth capital works will improve this year to the tune of £12,000,000.
All these sums are relatively insignificant when one considers the plight of industry and of the unemployed. Such injections of money into the economy are very slow; they are spread over a whole year and are not dynamic enough. A quick injection of funds into the economy, a very quick stimulus, is needed to retrieve the position. The plight of the unemployed, which the Government has said is its first consideration for the year, deserves far more attention and consideration than it has received in the preparation of this Budget.
Sales tax on household goods is to be remitted to the tune of £9,000,000. That is a useful sum, but again it is a relatively insignificant contribution. I have heard it said that a stimulus will be given to the economy in that the basic wage rise will inject a further £70,000,000. Let me be clear when I say that that is not something which was provided for initially in the Budget. The Government cannot claim credit for it. That is money which has been granted by the Commonwealth Conciliation and Arbitration Commission. It has been granted merely to do justice to the workers - to make amends for the increase in prices over the preceding period. What will happen to that £70,000,000? The recipients have moved into higher income brackets, and the Treasury will take at least £20,000,000 of it in extra income tax. The Government cannot claim that that is a budgetary measure designed to stimulate the economy. As far as the budget is concerned, it is an accident; it was an increase determined by a body other than the Government.
The Government takes credit, too - one may be pleased at the prospect - that a substantial amount of money will be injected into the economy in the form of tax refunds. But that will not be a voluntary contribution by the Government to stimulate the economy. It is a compulsory repayment of over-paid taxes. Certainly it has to go through the Budget, but it would have gone through come hail, rain or shine. Whilst it is true that it will have the effect of stimulating the economy to the tune of some £90,000,000, it is not a contribution for which the Government can claim credit as part of its budgeting in the present emergency.
Now let me turn to the plight of the farmers. One might have expected to see something quite dramatic done to relieve the plight of the farmers. As far as I have been able to ascertain, they are to receive, with respect to the laying of underground water pipes, a taxation concession that will amount this year to a whole £30,000- £30,000 in a Budget of £1,935,000,000! Also, the Government is prepared to allow the farmers to spread the compensation that they receive for the destruction of diseased cattle over a period of five years instead of including it in their returns for one year. That will mean a benefit this year amounting to the magnificent sum of £125,000.
– That is not quite true.
– That is exactly what the Treasurer has said - that it will be £125,000 in this year 1961-62.
– What about the provision of £13,000,000 from the wheat stabilization fund?
– I am talking about what is contained in the Budget this year to help the farmers. The only other form of assistance I can see is a contribution of £5,000,000 to the capital of the Commonwealth Development Bank. That money is to be used to help not merely the farmers but all primary industries and secondary industry. Those contributions are drops in the ocean. Quite frankly, it would have been better if two of them had been left out of the Budget, because they do no more than insult the farming community.
I turn now to mining and afforestation companies. Senator Scott is very much interested in mining companies. Let us see how they have been stimulated. I find that the Treasurer has included in the Budget a minor taxation adjustment. It will be such a marvellous stimulus to the economy that it will not involve, he said, one penny loss of revenue this year! However, the companies will get some benefit from it in 1962-63. Do I hear Senator Scott cheering about that stimulus to the mining industry?
– All I can say is that it is much more than Labour would have given.
– Where is the attack on inflation? The Treasurer has posed inflation as being one of the problems we must attack. But where do we find in this Budget any concession designed to get costs down? One obvious way in which to attack that problem would be to look at the payroll tax. The Tariff Board has told us that every £1 paid in pay-roll tax adds £2 to costs. But there has been no approach to that problem. Let me refer to what the Prime Minister had to say at Launceston on 5th July last on the subject of inflation. I have not taken from the newspapers the passage I am about to quote. I shall read from the document that was circulated by his office as being a verbatim record of his speech. He said -
I have been here a long time, but I would resign my job if I did not think I had enough guts in me to stand up to an inflationary problem and to do what I thought was the right thing to do about it.
That is the first time to my knowledge that the Prime Minister has been inelegant in his speech for the sake of emphasis. Inflation may have been relatively slight last year, but what powers to deal with inflation did the Prime Minister lack in 1950, 1951 and 1952? In that period the basic wage rose by 40 per cent. Taking the consumer price index, which has been applauded by the Government and which is now generally accepted, the index rose from 66 points in 1950 to 100 in 1953. In those years the basic wage rose, not because of any action by the court, but merely as a result of cost of living adjustments brought about by increased prices. In three successive years the basic wage rose 13s., 38s. and 31s. - a total of £4 2s. What was wrong with the Prime Minister’s courage or understanding in those days? That is when the damage was done.
Coming to the inflationary boom of last year, of which we have heard so much, I propose to cite the Commonwealth Statistician’s publication of 20th July, 1961. In that publication it is stated that in 1959 the index for the six capital cities was 116 points. By June, 1960, the figure had risen by 2.9 per cent. But during the. time that the Government was applying its economic measures the figure increased by 4.9 per cent. Throughout that period the index rose quarter by quarter. In the first quarter it rose by 1 per cent. I am referring now to the calendar year in case the Government, when talking about the 1960 boom, has taken the calendar year. In the first quarter the price index rose by 1 per cent. In the second quarter it rose by 2.1 per cent. In the third quarter it rose by 1.4 per cent. In the fourth quarter it rose by .8 per cent. That was the extent of the inflationary boom which the Prime Minister said triggered off, amongst other things, the economic measures of last November. Why did not the Prime Minister worry about inflation when it really mattered - when the economic base of this country was destroyed so far as our cost structure was concerned? He must accept responsibility in this regard.
Where in the Budget proposals is there any indication of relief from the flood of imports that have been coming into the country, adversely affecting our great industries - our paper-making industry, our timber industry and our textile industry? Each of those industries is in a desperate economic plight to-day. Where is there a single proposal acknowledging the gap in the loan market? Where in the Budget is there a single proposal indicating that the Government intends to do anything about the loan market, despite the acknowledgment by the Treasurer last March that a colossal burden has been imposed upon the taxpayers? Where is there any sign of relief? The Treasurer says that he wants to encourage spending. He also wants to encourage saving. What stimulus does he give to the people of Australia to do those things?
Let me return to the balance of payments position on current account. It is not generally realized that our success in this field is important to every man, woman and child in Australia. Between 65 per cent, and 70 per cent, of our imports consist of basic materials upon which our manufacturing industries, our heavy industries, our chemicals industry and our paper industry depend. Our balance of payments position, affecting as it does our imports, has a marked effect on our level of employment, our standard of living and the rate of our national development. Yet last year we spent £369,000,000 more than we earned. The additional money required to cover that excess spending was provided in two ways. First we borrowed approximately £100,000,000. The great bulk of that sum was borrowed from the International Monetary Fund, involving quick repayment. The balance of the excess spending was covered by a phenomenal inflow of foreign capital into Australia - £140,000,000 more than in the previous year.
But the thing that caused the Government to panic and drove it to take its disastrous economic measures in November was the opening of the flood gates to imports in February. 1960. By December of that year our reserves had fallen by £171,000,000. That amount of money went down the drain. It was taken out of the hands of the Commonwealth Bank. It is true that we have recovered those losses. It is true that by June of this year our reserves had improved by £39,000,000 compared with June of last year, but that money came from borrowing and from the flighty inflow of capital. What an insecure base upon which to rest! What a tragedy it was to lose £171,000,000 in one year! We were down the drain or in the red to the tune of about £400,000,000. On what? On consumer goods that are used in a year and for which we still owe money. We still have in this country capital upon which dividends must be paid. That means that we shall have to make payments out of the country. In its August report the National Bank of Australia envisages a marked decline in capital inflow. The report states -
A marked decline has occurred in the volume of overseas buying as a result of recent unfavourable political and economic developments.
The Leader of the Government in the Senate (Senator Spooner) has supported the view that in the future the rate of capital inflow will decrease. He said publicly and emphatically - I think correctly’- ‘that if Britain joins the Common Market, she will need her money for her own development. He also indicated - I agree with him again - that America will invest more in Europe. So Australia may expect a very much reduced flow of money from overseas. If that is the prospect for Australia, what an unsure base our balance of payments position rests upon. What insecure bases our employment opportunities, our standard of living and our rate of national development rest upon! Unquestionably something should be done about the matter.
In his Budget speech the Treasurer made one very important statement, one upon which I should like to enlarge. I hope that the Senate will take particular note of this statement as it applies to our balanceofpayments position. The Treasurer said -
Short-term measures are an illusion and a menace if they cut across the main objects of policy, as I have stated them. They are an illusion if they provide mere temporary relief and then peter out. They are a menace if they sow the seeds of later instability.
I agree with every word of that statement, and I invite the Senate to apply it to our international balance-of-payments position, where we depend upon unpredictable inflows of capital and upon our capacity to borrow. Our capacity to borrow and our ability to encourage overseas capital to come to this country will not be as great in the future as they have been in the past. What a base upon which to rest the prosperity of Australia!
In June last, in a nation-wide telecast and broadcast, the Prime Minister claimed as justification for his November measures the fact that in Australia last year we had a consumer boom. There may have been a boom in some aspects of the economy, but there was no boom last year in the motor car industry. The best indication of that is what happened in the hire-purchase field. The money owed to the hire-purchase companies on motor cars represents about three-quarters of all the money owed to hire-purchase companies. It is nearly the whole lot. There one gets a very good indication of and measuring stick for the consumer boom. In 1955 the Prime Minister became alarmed when hire-purchase outstandings rose to £183,000,000. He met representatives of the hire-purchase companies and he got them to agree not to increase the level of their advances to more than £183,000,000. He announced the success of the negotiations in the Parliament on 27th September, 1955. Three months later the hire-purchase companies completely repudiated that agreement. They threw the agreement back in his face and went merrily on their way. Outstandings rose every year. They jumped from £183,000,000 in 1955 to £450,000,000 last year.
What did the Government and the Prime Minister do? They did nothing to the motor car industry. They did nothing to the hire-purchase companies which had insulted them and defied them. In order to contract the motor car industry the Government put new burdens upon the backs of the people of Australia at flat rates. In March, 1956, the Government, in its little budget, took it out on the people and added to inflation by increasing the rate of sales tax on commercial motor cars from 16$ per cent, to 30 per cent, and increasing the sales tax on spare parts and the duty on petrol. Not content with that, it increased sales’ tax on tobacco and liquor. I make the point that all those taxes on the Australian people were at flat rates. But nothing was done to the motor car industry then and nothing was done to the hirepurchase companies.
The Government halted them in their tracks in November last year by doing what it should have done in 1955 or 1956. It just said, “ If you attract money at high interest rates to the detriment of the loan market and the economy and stimulate an activity, particularly the motor car industry, that the Government claims has got out of line or out of proportion, the excess interest will not be allowed as an income tax deduction “. The Government could have done five years ago what it did in November last. That was the simple expedient of saying to the companies, “ If you pay excess interest it will not be allowed as an income tax deduction “. That measure operated successfully. Since it was applied, over the last six months the outstandings have dropped by more than £50,000,000. But here is the tragedy of it: The Government kept that control on only until June last. It put that control on early in the year and took it off in June. It was really effective. At present the motor car industry, so far as the Government measures are concerned, is free to go . its hardest and the hirepurchase companies are free of all restraint. That is the position.
I want to say a word or two on unemployment. The very action that was taken in March, 1956, the increase in sales tax, was the factor that precipitated unemployment in Australia, and it has gone on ever since. The number of people unemployed in December, 1955, was 16,000. I ask the Senate to listen to the peaks of unemployment - I am talking of the peaks; I do not want to be misunderstood - in each successive year. In 1956 it was 36,000; in 1957, 59,000; in 1958, 75,000; in 1959, 82,000; and in 1960, 69,000. Unemployment began to fall in 1960 for the first time in those years. It dropped to 34,000 at the end of October last year. It was really improving. Then the Government, which claims that it is so concerned about preserving full employment, brought in its economic measures. It seemed to be unhappy that, with only 34,000 people unemployed last October, it had almost full employment. I wonder whether members of the Government are happy now when they have 113,000 people unemployed.
I do not want to develop this theme, but unemployment, of course, has a snowballing effect. It feeds on itself and it grows. The Minister for National Development (Senator Spooner), who is at the table, chides members of the Labour Party when they talk about unemployment. No doubt we will hear from him on this subject to-night. Let me quote what he said on 8th March this year when the unemployment figure was running at 73,000, about 40,000 fewer than it is to-day. The Minister, to loud laughter from Government senators, said -
The Opposition relies on destructive criticism, but I give it this advice. Lay off this theme song of unemployment. In the army we had a song entitled, “ His Comrades Don’t Believe Him “. That is happening to the Australian Labour Party to-day. The Australian public does not believe it.
The people believe it to-day when 113,000 people are unemployed. That is a statement made by Senator Spooner, the responsible Leader of the Government in the Senate, as recently as March this year! I invite him to say whether it is or is not the duty of an Opposition, to direct attention to that position, to demand that it be rectified and, moreover, to demand that it be rectified quickly.
If he says that we are talking gloom, I invite him to say what is the position of the great Churches of Australia. The ten great Churches of Australia sent to the Government a document on the subject of unemployment in which they said -
We realize that a great many people have been affected by our economic problems, but we are conscious that the burden is falling most heavily upon those least able to bear it - the lower income group.
I invite Senator Spooner to say whether those Churches are apostles of gloom or whether they feel a sense of responsibility to the people who are in that plight.
Mr. Deputy President, there are many other matters with which I should like to deal. I have said a little on inflation. I am afraid that I cannot touch on taxation beyond making the bare comment that under this Government the emphasis has been shifted off the fair tax, income tax. The ratio between direct and indirect taxation was approximately 60/40 in favour of direct income tax under Labour; now it is almost 50/50. There has been a change of near 10 per cent, which means a transfer of £100,000,000 from direct income taxation to flat-rate taxation on the Australian people.
By and large, what is the position of the average Australian to-day? He alone is asked to bear the burden of measures to halt inflation. Nothing is done to the great companies that build vast reserves, provide for depreciation and pay great dividends. Last year companies paid £150,000,000 in dividends; undistributed profits accounted for £215,000,000; and £505,000,000 was provided for depreciation. That was all taken out of prices. In other words, the consumers of the day are required to provide the capital replacement through prices and also to provide the reserves for the capital development of the great concerns of Australia. As I have said, the burden of halting inflation is thrown on the workers. Their wages were pegged from 1953 to 1956 at the instance of the Government and they were pegged again recently. Child endowment is a matter of grave injustice, as I have indicated. Free hospital treatment has gone at the instance of the Government. Free pharmaceutical benefits have gone. We have inadequate housing, high interest rates and serious unemployment. It is not a good picture for the people of Australia. It is an unjust situation.
Progress, true development and all the rest cannot be achieved in a country unless it has happy and contented people, and you cannot have happy and contented people unless you do them justice. This Government lacks entirely a sense of urgency. Senator Scott has asked me for Labour’s proposals. I will give them to him in a sentence. The surest and the quickest cure is to get rid of this Government.
– Mr. Deputy President, I listened to the speech of the Leader of the Opposition (Senator McKenna) with great interest. Obviously, he had done a great deal of work in preparing the speech. It is not an easy speech to answer in debate because, I say with respect, it was a speech without a theme. It was a speech that did not have a constant thread running through it. It indicated a lack of policy and a sense of what should be done and what should not be done. The speech was an attack upon the Government in order to show that everything the Government had done was wrong. That is what one expects of- an Opposition, but one expects something more than that. One expects a logical development of the theme and justification of it. Let me. make this big criticism of what Senator McKenna said.- He reiterated over and over again that the Government had to do more to relieve unemployment, and that it had to reduce sales tax, make more money available to the States, and increase the volume of social services. All of these things had to be done, he said, yet almost in the same breath he declared that the
Government should do something to reduce inflationary pressures throughout. Australia. There were two contradictory arguments advanced in one speech. It must be a great and glorious thing to be in opposition, and to be able to say these things in such an irresponsible way.
We have had from Senator McKenna an analysis of a series of statistics: He warned me off calling him a prophet of gloom. That was a guilty conscience speaking before his speech was replied to. He cited various statistics. There had obviously been a good deal of research work on his part. He analysed the gross national product, personal consumption, farm income, international balance of payments, and all the other various statistics to which one can turn, to endeavour to prove his point that the economy of the country is unsound and that there is no future for Australia under the present Administration.
Let us just turn over the page for a minute and have a look at what other people think about the position in Australia. Let us examine a few statistics that do not come out of the White Papers, but can be picked up in other places. I remind the Senate that in this country, with an economy that is as unsound as the Leader of the Opposition would have us believe, in the seven months to 31st July last, the approvals that were granted for new commercial and industrial buildings amounted to no less than £109,000,000. When the Leader of the Opposition talks in terms of the economy being unsound, I say with respect that people who are prepared to put their capital to the value of £109,000,000 into such ventures obviously do not accept Senator McKenna’s point of view.
May I remind the Senate of what happened in the New South Wales Parliament a little while ago? The State Labour Government started its new parliamentary session with what was really a hymn of praise about the prosperous conditions that exist in New South Wales, and my only criticism is that the State Government endeavoured to take credit for that state of affairs, whereas the foundation was laid by the Federal Government, and the State Government built on that foundation. The State Government announced that in New
South Wales alone £79,000,000 worth of new projects were in contemplation for the next two years. Is -it :not true to say that the skyline of every capital city in Australia is changing? The great buildings that are going up represent confidence on the part of investors. Senator McKenna talks in terms of big public companies., There are big public companies in Australia, but let us not forget that they are no more than an aggregation of thousands upon thousands of Australians who put their savings into shares in those companies. That is just a sign of Australian development in another form. Throughout Australia such confidence is being shown in the country’s future that new large buildings are going up everywhere.
Confidence is shown in business transactions. We have seen a whole series of business transactions, running into millions of pounds, which represent a new development in Australia in the last decade. We see the take-overs that are occurring. Woolworths Limited is taking over Rockmans Limited in a £5,000,000 transaction. Commercial and General Acceptance Limited is attempting to take over Huddart Parker Industries Limited for £4,500,000. There is a whole string of such transactions, showing that those who are running the business part of the community do not share the pessimistic views that are so popular on the Opposition side of the Parliament.
Let us have a look at what is happening in the Australian steel industry with another one of these big companies, which the Opposition is so prone to criticize, and which has no fewer than 73,446 Australian shareholders. When the Opposition criticizes a company of that size, it criticizes 73,446 Australians who have enough confidence in the future to put their savings into that company. Its capital expenditure last year was £40,000,000, and it is now entering into a great new venture in Western Australia in which it will commit itself for further capital expenditure of £44,000,000.
Let us look at the motor industry, of which Senator McKenna was so critical. In 1948, there were 1,000,000 motor vehicles registered in Australia. The number rose to 2,000,000 in 1955 and to 2,908,000 by 30th June, 1961. Where is the justification for pessimism in any of the information or any of the figures that I have given? They show optimism, growth and development. The , great problem that the Opposition fails to appreciate is that that progress, growth and development were proceeding at a rate somewhat in excess of our physical resources.
We have had from the Leader of the Opposition a great deal of criticism about the unemployment position in Australia. Let me refer to what he had to say on that score. As he said, at present 113,439 people are registered for employment in Australia. That is not a good thing for a Government pledged to the maintenance of full employment, but let us have a look at it. How serious is this situation? As Senator McKenna did, I went over the figures for the past few years, but from a different point of view, from a different angle. I went over them to see the trend, and to find the normal level of people registered for employment. I found only two months in recent years when the number registered for employment was below 50,000. Those two months were at the height of the boom in June and September last year, when 47,000 and 35,600 respectively were registered for employment. So the normal number registered for employment in Australia, I suggest, is somewhere between 50,000 and 60,000. I remind honorable senators of the statement by a very prominent person on the Labour side of politics whom we all respect; that having regard to the natural trend of events in Australia’s economy it was practically impossible to run the nation’s affairs withOUt the number of persons registered for employment being about li per cent. One-and-a-half per cent, of our present labour force of 4,200,000 is 63,000. The number of unemployed is at present 113,000, which is only 50,000 in excess of what even Labour supporters regard as a normal figure. Think about that! Think of how many other countries in the world would like to be in that position! Remember it in relation to the recent survey, which was mentioned in the report in which these figures were issued! No fewer than 54 per cent, of the factories that were surveyed were working overtime, no fewer than 20.3 per cent, of the employees were working overtime. Yes, I know it is a serious matter for those affected, but do not get carried away. This is not the great political issue that honorable senators on the Labour side of this chamber would hope that it was. Let us look at Australia’s position in comparison with the position in the United States of America and in Canada. The latest percentage figures available for this year in respect of registrations for employment are as follows: -
– Is the basis of assessment the same in all countries?
– I think it is correct to say that the basis is not quite the same but there is a sufficient degree of accuracy in the comparison for it to be a useful one for these purposes.
As I have said in the Senate many times previously - and I have no doubt I shall repeat it in the future - the great problem that confronts every government in this modern world is to maintain a policy of full employment in competition with the inflationary forces. We are not very happy about the present situation. But do not let us forget that 2.7 per cent, of the work force is registered for employment, that at present there are 113,000 persons unemployed, instead of the normal number of 50,000, let us say.
Let us have a look at the effect of this situation on the living standard of the remainder of the Australian population. That is the important matter that we have to take into consideration. Let us look at what has happened over recent months. There is no doubt at all that what we have done has consolidated Australia’s finances internationally, and there is no doubt that our balance-of-payments situation is strengthening. The latest figures that have become available show that our total gold and balances held abroad have risen from £512,000,000 in June, 1960, to £550,000,000 in June, 1961. They fell to £376,000,000 in December, 1960, but they rose, as I have said, to £550,000,000 in June, 1961. From that amount of £550,000,000 there should be deducted £78,000,000 that we borrowed from the International Monetary Fund. 1 suggest that those who are registered for employment as well as those who are not registered for employment should reflect upon the fact that what we have done has been to maintain Australia’s solvency internationally and that, without international solvency - without adequate balances overseas - there is no sound basis at all for the future of a nation which is assuming overseas trading transactions as Australia has done. Added to that is the fact that both the wholesale price index and the consumer price index have steadied. In other words, what we have done has been to stop the boom and, despite what Senator McKenna has said to the contrary, to put things on a reasonably stable foundation. The methods that we employed have served their purpose. They have now been removed, for all practical purposes, and we are the better for them; we have reached a situation from which we can proceed in the future.
We have heard from Senator McKenna to-night one interpretation of the contents of the Treasurer’s Budget speech. Let me give you another interpretation of them which, I believe, is infinitely fairer and sounder. I regard the Budget speech as a frank exposition of where Australia stands at the present time, of the difficulties that we have faced and of the situation that we are in as a result of having faced those difficulties - the foundation for our future development. The Budget speech recalls the measures that were taken, and it demonstrates the extent to which those measures were successful. It recounts, in perfect truth, that our economy is strong and that our economy does indeed provide a foundation for development in the future. I believe it to be true to say that the key note of the Budget speech is a tribute to the dynamic nature of Australia’s economy, of the way that Australia is continually growing and developing and of the fact that our problems are being overcome, as they must be overcome if we are to continue - as we all want to do - to maintain that rate of development.
I think we can all take a good deal of pride in the fact that the Budget shows that the total cash receipts in 1961-62 are expected to be no less than £1,918,000,000. The Budget is a recital of what has happened. It is a recital of the measures that were taken to stabilize the economy and it is a recital of bold and imaginative planning for the future of Australia. The Budget refers to the provision of roads in the north of Australia and to the improvement of handling facilities in coal ports in New South Wales, and it presents a magnificent vista of a new steel industry in Western Australia. These things were all planned in the Budget.
– Not in the Budget.
– They were all foretold in the Budget; they were all set out in the Budget; and they have been brought to pass since the Budget was delivered as, indeed, will all the other proposals contained in the Budget be brought to pass.
The aims of the Budget are to reduce unemployment in Australia from the extent to which it exists at the present time but to do so - this is in contradiction of the views that were expressed by the Leader of the Opposition - without recreating the boom conditions, as the views that were expressed by Senator McKenna would do if they were translated into action. As I have said, the aims of the Budget are to reduce unemployment and to do it without re-creating boom conditions; to lay down the foundation for further growth and development in Australia; and, concurrently, to maintain social equality as we have consistently done in the years that we have been in office, by gradually and constantly increasing social service and repatriation benefits. Those are the aims and objectives of the Budget. I believe they are sound.
Senator McKenna, I think with a great deal of wisdom, said that he would not outline in any detail the constructive proposals of the Labour Party, since they had been outlined in another place. It is the old socialist story which has been proved wrong so many times before. The Labour Party never seems to learn or to forget. The party has put forward proposals in the past. The proposals that it put to the people before the last general election were calculated to cost no less than £165,000,000 a year. Of course, the electors had no confidence in them, just as they will have no confidence in the proposals that Labour puts forward in the future. How could the people have confidence in them? Let me illustrate what I mean by referring to a specific instance of which we in the Senate have knowledge. The Leader of the Opposition in another place, when dealing with a matter that affects my portfolio, said in a loud voice that the maximum loan that should be available for war service homes was £4,000. He patted himself on the chest, and the news went out to the nation that Labour was in favour of making loans of £4,000 for the erection or purchase of war service homes. Within a week, the Labour Party in this chamber moved an amendment to a bill which I had introduced, for the purpose of making the amount of iiic loan £3,500 Although a statement had been made in the House of Representatives that the loan should be £4,000, when put to the test in this chamber the amount was reduced to £3,500. What confidence can there be in a party which proceeds on that basis? What confidence can there be in a party which brings forward proposals relating to overseas shipping lines and government insurance companies? The net result of such proposals would be to drive capital out of Australia and to destroy the confidence that the business people and the ordinary people of this country have when they invest their savings, and that overseas investors show when they bring forward new projects in Australia.
Senator McKenna, of course, had his usual tilt at housing. What are the facts and circumstances with regard to housing? In about November of last year we were building houses at the rate of about 100,000 a year, with the result that housing costs were up in the clouds and land was changing hands at very high prices. Those developments were being paid for by young, married couples, who were least able to do so. The building of a house or the buying of a home is the greatest investment that such people can make. They were in a situation in which costs were being forced up. I know that the housing rate has fallen. It fell from the 100,000 level that it had reached in the early part of the year to about 75,000. We have introduced further money into the real estate and building market with the idea of stabilizing, for the time being at least, at a rate of construction of about 80,000 homes a year, a level that is close enough to that which the building industry can support and which is, by any standards, more than the current demand for housing in Australia. That will make its contribution to taking up the housing lag that still remains. That part of our policy, as with so many other parts of it, has been successful.
Recently, I saw figures which showed that the last lot of group war service homes built in Brisbane were about £300 cheaper than such homes had been previously, the cost being just under £3,000. That is a very valuable contribution to an exserviceman going into a war service home for the first time. I do not remember the exact figure in relation to group war service homes in New South Wales, but I shall obtain it by question-time to-morrow. My recollection is that there was a fall of about £180 per house on the values that existed towards the end of last year. I think it is true to say that that position is fairly general throughout Australia.
By pricking the balloon, by being a bit unpopular, by taking some political risks, and by having a good deal of courage financially, we have done the things that we think had to be done to meet a different set of conditions. One of the interesting things, to my way of thinking, is that in the period that has elapsed since November last I have not met anybody who has said to me, “ What you did was unnecessary “. I have not yet met any one who has said that there did not exist a position which needed correction. It was left to the Leader of the Labour Party in another place to describe, for the first time to my knowledge, the November conditions as a myth. I had not heard that said previously. Wherever I have been there has been an acknowledgment that the situation had reached the stage where it needed correction. My arguments with both my friends and my enemies have shown that, while they had their own pet theories, as Senator McKenna has, and while they thought that different measures should have been taken from those that the Government took, many of their ideas were aimed at getting the same result as the Government has already achieved.
We have done that which we thought we had to do. We believe that we have done it successfully and that, having accomplished it, we have a sound foundation for further progress and development in the future. What is more to the point, we believe that the views we hold are shared by an overwhelming majority of those people who hold responsible positions in Australia. When I say “ responsible positions “ I do not mean only in financial circles, but also in trade union and other circles. I think that the majority of such people believe that we did what was right, that we did it successfully and that the way is. clear for us to go ahead in the future.
– Before I begin my comments on the Budget, Mr. President, I wish to refer to certain accusations against the Australian Democratic Labour Party that have been made in another place. Since the party has no members in that place I think it is fair that I should have the opportunity to reply to the accusations. Certain honorable members have said that the Democratic Labour Party is responsible for this Budget because the party has kept the present Liberal Party-Australian Country Party Government in power. It has been, not the Democratic Labour Party, but the stupidity of the Australian Labour Party and its leaders that has kept the Government in office.
It has been said by one member in the other place, Mr. Gil Duthie, that members of the Democratic Labour Party have been meeting members of the Liberal Party and the Country Party during the last, week to discuss election preferences and things of that sort. I am afraid that our engagement book was too full of the names of Australian Labour Party members for us to worry about members of the Liberal and Country parties. Mr. Duthie said also that there was only one Labour Party in Australia. He came to Tasmania from Victoria. If my memory serves me right - he has attacked us very often and I have not worried about him, but he continues his attack - Mr. Duthie was a member of the Communist Party before he came to Tasmania.
– I rise to a point of order. Is lt your practice, Mr. President, to allow an attack to be made on an honorable member in another place who has no way of defending himself? Is it right for an honorable senator to impute such motives to a member of the other place?
– The point of order is not upheld.
– 1 make these accusations because accusations were made in another place against my party. Those accusations must be answered. As I was saying, Mr. Duthie, before he came to Tasmania, it may be for certain economic reasons, had a right to be a member-
– Did you know he was a Communist when you were associated with him?
– No, I did not- not until Bill Morrow was on the hustings.
– You were associated with Duthie for years?
– That is correct. The trouble with you people is that you associate with too many Communists at the present time.
– That is just filthy nonsense.
– Let me say definitely that the Democratic Labour Party has its own programme and its own policies. ‘Those policies will be implemented when and where possible. It is our own policies that we put before the Senate. If we can influence this Liberal-Country Party government, well and good. If members of the Government listen to our programme, that is what we desire them to do. That is why I am speaking on the Budget on behalf of my party to-night.
I pass on to the matter under discussion - namely, the Budget. In view of what is happening inside and outside Australia today, it is a very dissatisfying document. We expected something better in view of the unemployment situation and the dangers that beset Australia now and could beset it in the not far distant future. Senator Spooner referred to the dynamic nature of the Budget and mentioned certain developments that would be taking place. I agree with what he said about those developments, but you cannot talk of a budget as being dynamic when it proposes that the level of social services in Australia shall remain virtually the same as previously and when it suggests practically nothing to help the many unemployed people in the country. We must develop Australia to the greatest extent possible, and that development must begin now, not in the future. Many of the projects that have been referred to by Senator Spooner are projects for the future, and I support them strongly; but, because of the peculiar situation in which the working population of Australia finds itself to-day, something must be done quickly. The Government must do something now to lift the unemployed out of the depression that has struck them.
I suggest that municipalities and State governments be given money at this moment to enable them to proceed immediately with very necessary projects. In every town, village and city numerous projects should be carried out. In the City of Melbourne thousands of homes are still unsewered. In some areas water reticulation is not up to the required standard and drainage and road works need to be carried out. Money for such projects should be made available in order to get people back to work. If that were done, the slight recession that we have to-day would be overcome. The money that normally is spent by 150,000 workers and their families cannot be taken out of circulation without some repercussions being felt. The Democratic Labour Party is afraid that unemployment will snowball and become worse. We do not want that to happen. Australia is a wonderful country - a country which should be making progress. We do not want to see it go back. Unless the. things I have mentioned are done straightaway, I am afraid a lot of hardship will occur. The unemployment problem should have been tackled more vigorously in this Budget. 1 should like to mention the causes of the present unemployment and to make some suggestions about how the position can be met. The causes can be listed under three heads. First, we had the indiscriminate lifting of import restrictions. Then there were the high interest returns on hirepurchase investment, which brought about an increase in general interest rates and made borrowing by local government authorities more difficult and expensive. Finally, we had the mismanagement of the general monetary policy.
The 150,000 people who are unemployed come from secondary and primary industries. The national economy is suffering grievously from the shock of the economic measures applied by the Federal Government. These men must be got back to work, and industry must again be put into top gear. It is a tragedy that nations that were defeated in the last war have a better employment position than has Australia. To have unemployed persons walking the streets of a country which helped to win the war is in the nature of a disaster. As I have indicated, employers in the defeated countries are looking for labour. In those countries there is no unemployment; rather is there full employment and even overemployment. I am afraid that the present position in Australia cannot be rectified merely by an emotional appeal to the nation to have more confidence in what will happen. We know that confidence is necessary. But it cannot be restored merely by asking; it can be restored only by doing something. As the Government holds the national purse, the doing must rest with it.
I have mentioned the immediate causes of unemployment. What was the general cause? First, there was the mismanagement of our import policy, which resulted in a great flood of imports and which severely restricted the home market and the local manufacturer. People were not patriotic in their buying; they stored more goods than they needed. That caused a lot of the trouble. I believe that over-lending by the banks, due to an increase of the cash base by a fortuitous and sporadic inflow of overseas capital, for the purchase of Australian securities was one of the main forces. The banks were permitted to lend as though the cash base was of a permanent and not of an artificial and temporary nature. That led to the inflation that we experienced in 1959-60 and which could and should have been restrained. It could easily have been controlled. That inflation was allowed to assume vast proportions. Then harsh and belated measures to combat it were considered to be necessary, and those measures were applied crudely and ruthlessly.
What measures are we to take at this present moment to deal with unemployment? Of course, the first and most desir able step to take is to replace unemployment by full employment. I should say we are all agreed on that point. What we need now is federal action to channel finance through the State governments to the local authorities to enable those bodies to put in hand works that have a rapid employment potential. I have in mind the construction of roads and the provision of sewerage and water supply facilities. The commencement of such works would immediately stimulate the industries that produce the necessary materials. This Government should make available to the Commonwealth Development Bank £50,000,000 to assist the implementation of works that would provide full employment for the people. That work, as I have indicated, could be entrusted to the local authorities.
We should also adopt a policy of controlled, selective import licensing, having regard .to the need for two-way trade and to the need not to endanger our balanceofpayments situation. That could be done either by adopting a banking policy designed to restrain the import of goods in keeping with our overseas earnings, or by the intervention of the Tariff Board in particular industries. Another method by which the difficulty could be overcome would be to guarantee extra finance to State housing authorities and the building co-operatives. They are all means that we could adopt to overcome unemployment. Moreover, we should control speculation, which has tended to inflate the prices of land and shares. I understand that, to a certain extent, the Government has succeeded in overcoming speculation, particularly in regard to the sale of land.
I believe that the most important aspect of the present unemployment situation is that the Government’s migration policy will be affected. Immigration is essential to our future welfare. But I do not think I or any one else believes that our migrant intake will reach the proportions it has assumed in recent years. If we reduce our intake, we will be doing a great deal to harm the future of Australia. In my opinion, unemployment, which has grown because the Government did not adopt the right measures at the right time, will have dire results.
One would have expected the Government to deal with certain , aspects of its activities more favorably. Let us consider the provision of social service benefits. The provision of social services is a bugbear to this Government and it will be a bugbear to any future government. In 1955-56, 16 per cent, of the money provided for in the Budget was used for social services. This year 21 per cent, of the proposed expenditure will be absorbed in the provision of such benefits.
– Do you include health and medical benefits in that percentage?
– I am not certain about that, but I believe those benefits entered into the calculation. In any case, the figures I have quoted contain the same ingredients. Although the benefits that are now being paid are quite inadequate to provide for the welfare of the recipients, can this country continue to provide for an ever-increasing expenditure on social services? If the provision for social services was what it should be, it would be very much greater than the figure I have quoted for this year. Since 1955 the social services bill has increased by 5 per cent. What will happen in the future? The bill will increase by even more. The only solution to this problem is the solution that my party has advocated on many occasions. It is high time the Government introduced a national superannuation scheme. Such a scheme must come. That was realized back in 1938. I cannot understand why the present Prime Minister (Mr. Menzies) has not introduced a national insurance scheme or national superannuation scheme. If we go back through history we find that in 1938 the present Prime Minister resigned from the United Australia Party, the predecessor of the Liberal Party, because the Government at that time, led by Mr. Joseph Lyons, would not introduce a scheme of compulsory national insurance. Mr. Menzies left the government of the day because it would not implement that scheme, although the necessary legislation had been passed through both Houses of Parliament and, I believe, had received royal assent.
– The act was not proclaimed.
– It was not proclaimed.
– You have something in common, haven’t you?
– Yes. If the Prime Minister believed in a national insurance scheme in 1938, why has he done nothing to introduce the scheme since then? The social services bill is becoming a greater bugbear to the Treasurer every year. In 1938, it represented a very small percentage of the national expenditure, but to-day it represents about 21 per cent, of the Government’s expenditure. A national insurance scheme would do away with the unfair means test. Everybody - who contributed would be entitled to draw from the scheme. I think the people would accept a national insurance or national superannuation scheme.
– There were some pretty strong reasons why the act was not proclaimed at the time, and those reasons persist to-day.
– The reasons were mainly political. The means test as it is applied to-day destroys the incentive to save. The people will not save their money because they know that if they do, in the long run they will lose. They get rid of their savings. The means test destroys thrift. But if a national insurance scheme were introduced a greater amount of money would be available for the most important item in the Budget - national defence. Our national income should be used for important things, rather than for giving small increases to pensioners, which only cause a lot of trouble and heart-burning. For many years we have tried to divorce pensions from politics. The introduction of a national insurance scheme would help to achieve that objective. Then, perhaps, we would not see in and around this chamber some of the scenes that we see each year shortly before the Budget is brought down.
Another aspect of social services that has received no consideration at all is child, endowment. Adequate child endowment is, in my opinion, just as important as adequate age and invalid pensions. The Government still refuses to help the most important section of our community - the people with young families. Under our wage system a man with a young family can be helped in one way only - by increasing child endowment. As his family grows, so a man’s responsibilities grow. A single man earns almost as much as a married man with a family. The only way to help the married man is by increasing child endowment. As a married man’s responsibilities increase, so should the amount of child endowment increase. That is what my party has been advocating for years. I had hoped that, this would be the year when the Government would realize the plight of the family man and increase child endowment But. I. am afraid that the Government has forgotten the family man. It is not interested in him. The value of child endowment has decreased considerably over the years. The amount has not been varied since 1948 except to grant endowment to the first child. The family man has been left lamenting. Any assistance that is given to the family man or to pensioners helps the depressed sections of our community. Money received by those people will be spent to buy the necessaries of life. An increase in child endowment and in pensions would assist the depressed sections of the industries that- are in so much trouble to-day and from which so many men have been put off work.
We know that the 5s. increase in the age pension was nothing more than a sop. Everybody expected the pensioners to get that 5s. The increase should have been at least 7s. 6d. In a great many cases that extra 5s. has already been countered by an increase in rents* Very often, as soon as the pensioners receive an extra 5s., their rents are increased by a« like amount - even when they occupy certain housing commission homes. The same thing applies to widows’ pensions. Widows do not get as much as they deserve, nor enough to enable them to . live decently. The Minister for Civil Aviation (Senator Paltridge) said that this was a dynamic Budget. If this is a dynamic country, is there any reason why the people who now subsist on pensions should not enjoy a reasonable standard of living? If they do not, our civilization is not what we should expect it to be.
Australia has the country, the potential, the people and the workers. Australia also has the money, if the Government will only use it. The credit of the country can be used to develop it and if the credit is used in that way it will, repay us. Do not be afraid of borrowing money, from overseas. Many people say that we should not borrow so much money from- overseas; but we must remember that if we are to develop Australia we must have the money to do so. At present our population is too small to provide, alt. the money that we need for development. It is rather peculiar that to-day we owe less money overseas than we did in 193 k In that year our overseas debt was £599,000,000 In- 1961, it is £434,000,000. In 1931, the overseas debt represented £91 16s. per head of population; in 1961 it represented- £46 0s. 8d. per head of population. If we want to develop Australia and give what we should to the people who- need assistance, do not let us be ‘afraid to borrow money overseas’.
Australia is like a person who has not a great deal of money. He has to borrow money if he wishes to build a house and he repays the loan. Australia, as a country, has to do similarly. Australia is only a poor country, especially in respect of population. So we have to borrow in order to improve it. Do not forget what we obtain from those improvements’. The money that comes in. should not be put into static things - for example, buying into wellestablished companies. The money that comes into Australia must be used for dynamic development. It will not do any. good if it is used in a static way. We have to bring the money into the country and use it for the development of Australia. The greatest development can take place in the north.
I should like to congratulate the Government. It spoilt a certain amount of my speech by the announcement it made in the last couple of days. I am very pleased that it made that announcement. That is what I want to see.
– Do you agree with the rail standardization plan?
– I think that standardization work should be done. We want development of that sort. The standardization work should be done in Western Australia and Victoria and the other socalled missing links should be standardized at the same time.
Something is to be done in the way of building beef roads in the Northern Territory, the Kimberleys, and in the Channel country of Queensland. That is important. That is what I want to see. But is it sufficient? Are we doing the work quickly enough? Those are the questions we have to ask ourselves. According to the Government, that is the best it can do, but I still think that the Government could do much better. We have not the time to develop Australia at an ordinary pace. As our population increases we will be able to spend more. That would be all very well if we had 100 years in which to carry out the development. But in the Senate club room to-night a film on the population explosion was shown. In a few years the populations of some countries will double. India’s population will increase from 400,000,000 to 800,000,000. That population explosion could affect Australia greatly. We have not got the time that America had in which to develop ali her resources and population. She did it over hundreds of years; we have to do it now. Anything that can be done for the development of the Northern Territory, north Queensland and northern Australia generally should be done at once.
That leads me to the subject of the defence of Australia. All this development is part of our internal defence; but are we doing sufficient for the defence of this country about which we think so much? We will have to rely, to a certain extent, on America- to help us out of any trouble. Unless we, as a nation,- show- countries such as America that we are prepared to defend ourselves against aggression by increasing our potential as an armed country, we cannot . expect them to take much interest in us. We are too far away. We have to show that we can do something for ourselves. I have mentioned before that we spend 3 per cent, of our national income on defence. That is all we think Australia is worth. England is spending 7 per cent, of its national income on defence and America is spending 11 per cent, of its. national income’ on defence.
The Government has a stereotyped’ attitude to defence. Every time it works out a budget, before it thinks about what it will spend on other things, it says, “ We have about £190,000,000 to £200,000,000 to spend on defence “, and then splits that amount up among the three services. That is not the way to look at this matter, because unless we are prepared to defend our country we will lose it.
-How much do you suggest We- should be spending on defence?
– We should be spending at least double what we are spending at present.
– That would be 6 per cent, of the national income.
– Yes. If we took defence more seriously still, our expenditure should be greater than that when we consider that England is spending 7 per cent, of her national income on defence. A comparison of her national income with our national income shows just how much, in actual money, she is spending on her defence. England is nowhere near the size of Australia, but she has a great number of commitments, of course. We should be spending much more than the 6 per cent, of the national income that I just suggested, if we are to do the job properly.
In connexion with our defence, we already have treaties with various countries. In order to honour those treaties, the Government must take a realistic view of defence, and not the stereotyped view that it takes at present. The Government has good Ministers. The Minister for the Navy (Senator Gorton) would be quite willing to have more money devoted to defence, arid he would’ know, I think, what the Country needs. He should be given an opportunity to put his ideas into practice. I am not suggesting which of the services should be favoured. They should work it out themselves. I am a little inclined towards favouring preparedness in the air. In this field we could do more for less money, which is ari important consideration, to prevent aggression. In the coming years we shall have certain other commitments. I spoke of these when dealing with the European Common Market. We shall need other means of transport. My main point is that we must get away from stereotyped thinking on defence, be more realistic, and be prepared to pay more for it.
I should like to deal with other subjects, the first of which is education, which is receiving a great deal of attention throughout the world. Through education, we may bring peace to the world. Are we doing enough? The Commonwealth Government says that education is not the’
Commonwealth’s business, but is a State matter. I agree that the States have control of education, but the Commonwealth has the purse strings. It is up to the Commonwealth to release sufficient money to allow State educational programmes to be implemented. I know that some State governments are remiss in the amounts that they devote to education from the budgets allowed them by the Commonwealth, but the Commonwealth must increase substantially the amounts provided and must make special grants for education. I refer to all branches of education, both State and denominational. Everybody should have the same right and justice should be done to all.
The Commonwealth should have a certain amount of control over tertiary education, that is, university and technical education. Tertiary education is now at the stage at which secondary education was 40 years ago. In the 1920’s secondary education was not considered for all school children in Australia. It was regarded as somewhat of a privilege to undertake secondary education. To-day that is the attitude to tertiary education. It has become a privilege, which should not be the case in a community such as ours. The way to tertiary education should be open to all. To achieve this would mean a tremendous strain on Commonwealth and State governments.
– What do you estimate the cost would be?
– I have not estimated the cost. I am stating the principle that should be followed.
– One of those pipe dreams!
– It is the principle that that counts, not the cost.
– The interest on the principal would be pretty high.
– And the principal will be high, but we must be prepared to pay it. Twenty years ago it came to be accepted gradually that secondary education should be open to all. Now tertiary education should be open to all.
The Government should have taken certain steps in relation to taxation. There has been relief from sales tax on furniture, which should provide a great incentive, but in other fields sales tax should be eliminated. Those things that we buy from bakers’ shops and confectioners should be free of sales tax. They are virtually essentials to-day. Senator McKenna made a forceful reference to pay-roll tax. He indicated that £1 in pay-roll tax meant an addition of £2 to costs.
– We would have to double pay-roll tax to pay for what you suggest.
– I have not suggested any amount at all in relation to education.
– You suggested doubling the defence vote.
– Yes. If the honorable senator does not believe in that, he should say so. At least, the Government should have abolished pay-roll tax payments by States and local government authorities. They are paying the greatest amounts of pay-roll tax, and they need that money to develop their own areas. The Commonwealth Government is taking from them almost £40,000,000 a year in pay-roll tax.
– What is the total amount that the tax brings in?
– £61,000,000. The Government is taking money from those authorities which want to undertake development works. It is time that the Government went out of the probate field. Certain things should be left to the States, and I believe it is time that this Government withdrew from the field of death duties. It is not fair to people who have been left estates that, first, the State concerned levies death duties on the first £10,000 of the estate and then the Commonwealth Government comes in and takes its share.
There is one thing which, I believe, would overcome the difficulties that we are facing in the development of this country. I refer to the unemployment position that occurs every now and again. I believe that the theme of decentralization should be preached not only in this Parliament but also in the States. Decentralization of the population and of industries would overcome many of the problems I have mentioned to-night, and would assist the provision of adequate defence for this country. Decentralization would help to solve the unemployment problem, it would relieve the over-crowded conditions of our cities. and it would minimize the toll that would be taken of lives in an atomic war involving Australia.
I should like to state the policy of the Australian Democratic Labour Party in relation to decentralization. The most important purpose of decentralization is to give to every member of the community an opportunity to lead a fuller life, in which the greatest possible freedom is safeguarded. Personal freedom can be complete only when all men have the ready opportunity to own and to make their own economic decisions. This freedom is being gradually whittled away by the growth of bureaucracy, on the one hand, and by private monopoly on the other, created by steadily increasing concentration of population, and, therefore, of industry, administration and ownership. Another very significant reason is that in order to develop the country to the fullest we have to develop the natural resources of this continent, for which big, vital towns in the areas concerned are needed. Our personal freedom and widely dispersed ownership can be fully realized only in a decentralized society. The decentralization of industry and population and, ultimately, of administration and ownership, is one of the central themes of the Australian Democratic Labour Party’s policies.
Our policies regarding decentralization are based on two main principles. The first is that decentralization of industry must come before any decentralization of population can occur. The second is that decentralization of population must precede any effective decentralization of administration. How are we to bring these things about? We suggest that, in order to enable firms engaged in competitive industries to set up in country areas, there should be a reduction of personal income tax and company tax. Secondly, a levy, or what we call a decentralization tax, should be made in respect of industrial sites. In the big cities industrial sites cost tremendous amounts of money, whereas in the country areas they can be obtained at a much smaller cost. A decentralization tax imposed on industrial sites in the cities would give a taxation advantage to people who established industries in the country areas and so compensate them for extra transport costs involved. The decentralization of industry and of administra tion would go a long way towards the decentralization of our population as a whole.
We believe that the Commonwealth Bank should grant long-term loans at nominal rates of interest to finance the moving of existing industrial equipment. To carry this out-
– You want Utopia. You were born too soon.
– There could be Utopia. If we set our sights right down, we can never hit the heights.
– No one could accuse you of doing that.
– I suggest to honorable senators opposite that they should aim high. If they do not get to the top of the hill, at least they may get half-way up it.
– You are wasting your ideas on the desert air.
– That may be. There is one other point that I should like to make, although I realize that honorable senators opposite are not very receptive of my ideas at the moment. By decentralization, in addition to developing the country we could do something in relation to defence which would enhance our reputation in the eyes of people in other parts of the world.
Mr. Acting Deputy President, I have mentioned certain objectives of the Australian Democratic Labour Party which are designed to help those who have been very seriously affected by the financial policies of this Government. I have said what I think should be done to help people who are in need in this country. I have outlined what should be done in relation to defence and I have advocated decentralization - the transfer of people and industries from the few big cities on our coastline in order to develop other areas of Australia. I hope that the Ministry will take note of my remarks so that the future of this country may be assured, even under a LiberalCountry Party government.
Senator SCOTT (Western Australia) [10.291. - First, I should like to congratulate the Leader of the Australian Democratic Labour Party (Senator Cole) on the contribution that he has made to this debate to-night. When one compares it with the speech of the Leader of the Opposition (Senator . McKenna)-
– There is no comparison.
– It is difficult to make a comparison. As Senator Courtice says, there is no comparison because the Leader of the Opposition did not introduce in his speech anything constructive at all for the Government to consider. All that the leader of the Australian Labour Party did was to decry the measures taken by the Government. When we compare his speech with that of the leader of the Australian Democratic Labour Party we cannot fail to agree that at least Senator Cole had some constructive ideas to put forward. He believes that if those ideas were put into practice great benefit for the nation would result.
– The Democratic Labour Party is the real Labour Party, is it not?
– I do not know whether it is the real Labour Party or not. All I know is that after every election it has been found that the percentage of votes polled in its favour has increased.
– Are you a paid organizer of the D.L.P.? One would think so to hear you.
– I am making a contribution to the debate, and I should like the honorable senator to listen carefully to what I have to say. In return, I promise not to interject while he is speaking. I had been about to say, when that rude interjection occurred, that the recent Victorian elections had shown the people of Australia that whereas the total number of votes cast for the Australian Labour Party had gone down, the number cast for the Democratic Labour Party had gone up. If votes for the party continue to increase at that rate it will ‘be a force to be recognized in the future’, even by us. I believe that when a person makes a speech such as that made by “Senator Cole to-night it denotes a considerable degree of thought and study. For that reason I congratulate the honorable senator, and for the same reason I decry the speech of the Leader of the Opposition in the Senate, because in the whole of his remarks he did not introduce any constructive suggestion for the Government to consider.
The theme of the Labour Party speeches this year is no different from that of any other election year. I have been in this Parliament for almost twelve years now, and in each election year I have noted that the supporters of the Labour Party have told the same old story of unemployment. The Leader of the Opposition stated that in Australia to-day more than 113,000 people were unemployed. He went on to say that that was the beginning of a recession, that conditions had never been worse, and that this Government had never been able to give anything to the people of Australia. He implied, although he did not say it, that ever since the Labour Party was defeated in 1949, things had gone from bad to worse. He implied that the economy had had it, and that the country was not expanding. That is his story. But let us compare the conditions that existed in 1949 with those that exist to-day, and if that is done I am sure that there is not one person in Australia who would believe the Leader of the Opposition. Not one person would like to go back to the conditions that prevailed in 1949.
The present Government parties and, I believe, the other parties in this Parliament, have a policy of full employment. I think that all the political parties will agree that such a policy has to be balanced on a razor’s edge.
– Is that right?
– I think the honorable senator will agree that you should not have over-full employment. Perhaps he does not agree, because he does not answer. Conversely, nobody wants too much unemployment. But if we want to strike a balance, it appears that some of the leading people in Australia believe that a degree of unemployment amounting to H per cent, of the work force is not a bad percentage to arrive at. Nobody wants to see even that degree of unemployment occur, of course, but as I am reminded, it has been said that that degree is inevitable.
In November, .1960, there was a condition of over-full employment in certain Australian industries. If we look at the housing industry, for instance, we find that for every building worker who was unemployed, there were eight vacancies. That Was a condition of over-full employment, and it should be recognized as such by all fair-minded people in this chamber. If there is a condition of over-full employment, the government that is in office, whether it is a Democratic Labour Party government or a Liberal Party-Country Party government - I do not give the Australian Labour Party a chance - must take action to correct it; otherwise inflation occurs. In November, 1960, costs in Australia were rising by 8 per cent, per year, which is far too high.
– Under this Government.
– Yes, under this Government. We took the steps that were necessary to correct that trend, and we will stand up to all the criticism that is directed at us for doing so.
If the government of the day, whatever its political complexion, believes in a policy of full employment it must ensure not only that there is not too much unemployment but also that there is not over-full employment. During the twelve years that I have been in the Senate we in Australia have never had a condition of unemployment which exceeded 3 per cent, of the work force. That is an achievement which had never previously been attained by any government in the history of Australia.
– You have 7 per cent. now.
– The honorable senator, who is completely stupid, says we have 7 per cent, of the work force unemployed now.
– Oh, no. You said, “ of the work force “.
– The figures show that at 30th June of this year there were 113,000 people unemployed.
– No. That was the number registered.
– Yes, that was the number registered, and that is what I am referring to.
– But that does not prove anything.
– It proves something to the satisfaction of the Government and it would prove something to the Labour Party, too, if it were in office, but of course it never will be, so we need not continue on that line.
Let me compare the June figures with those for July. The increase in unemployment between 30th June and 31st July was only 1,300 or 1,400, whereas the increase between 31st May and 30th June had been approximately 9,000, and that between 30th April and 31st May, approximately 13,000. In the last three months there has been a steadying of the employment position. The reason for that, of course, is that the Government, realizing that we had unemployment in Australia, endeavoured as far as possible to create positions in government circles and to promote a feeling of prosperity, so that additional employment might become available. I firmly believe that within the next three months we will see the unemployment figure begin to recede month by month.
– You said that twelve months ago.
– I did not. Twelve months ago we were talking about inflation, not unemployment. You people change your cry from year to year. One year you talk about inflation and the next year about unemployment. It always happens to be unemployment in an election year. I am not afraid to debate unemployment with you because the record of this Government in the field of employment in Australia is better than that of the Labour Party.
– In 1948 or 1949?
– I will take honorable senators opposite back to 1945. When the Labour Party was in office in 1945, Mr. Haylen spoke in another place on the Reestablishment and Employment Bill. He is a Labour member of Parliament. He said -
T realize that there cannot be total employment, but if we- ‘
As a magnificent Labour government - can get down to 5 per cent, of unemployment, for all practical purposes’-
– That is not what he said.
– It is reported in “ Hansard “.
– In view of the interjection, I will read Mr. Haylen’s words as they appear in “Hansard”, without any variations. Speaking on the Re-establishment and Employment Bill 1945, Mr. Haylen is reported in “ Hansard “ of 15th May, page 1697, as follows -
I realize that there cannot be total employment, but if we can get down to S per cent, of unemployment, for all practical purposes that can be regarded as total employment.
– That is different from what you said just now.
– That is word for word what he said. If any honorable senator opposite is thinking of contradicting me he can look at the passage himself. We have, therefore, Mr. Haylen in the House of Representatives, when the Labour Party was in office, saying that if we did not have more than 5 per cent, of unemployment, to ali intents and purposes we would have a state of full employment in Australia. That is what a member of the Labour Party said when the present Opposition party was in office and the present Government parties were in opposition. Now that we have 2.7 per cent, of the work force unemployed the Opposition howls and screams, and says that the Government should not be in office.
– What was the position in 1949?
– I have some figures here taken from the Commonwealth Year Book for 1953. The year book - in case honorable senators opposite want to refer to it and contradict me later - is No. 34, and I am quoting from page 432, under the heading “ Unemployment of members of trade unions in Australia”. In the June quarter of 1949, Mr. President, there was 5.5 per cent, of unemployment. Under a Labour Government there was unemployment amounting to 5.5 per cent, in the June quarter of that year, yet honorable senators who were members of that Government have the hide-
– The audacity.
– They have the audacity, if you like, to get up in this chamber and criticize a government which, during twelve years, has never had more than 2.7 per cent, of its work force unemployed. That is the position at present. I firmly believe that unemployment will never increase beyond 3 per cent. The Government has a record of which it can be proud.
I wish to deal now with some of the remarks of Senator McKenna. He quoted Mr. Holt as saying -
To-day the Australian economy is, I believe, basically stronger than it has ever been.
He also quoted Mr. Holt as saying, “We have always stood for full employment”, and again, “ Externally our situation has greatly improved “. These are all statements in the Budget speech that the Leader of the Opposition criticized. Having carefully studied this important document - the Budget speech of 1961-62 - I want to congratulate the Government. Having studied carefully all the budgets that have been brought down since 1949, I believe that this is the best budget that has ever been introduced in the Parliament of Australia.
– You said that last year.
– It is completely untrue that I said that last year. This is the first time I have used those words of a budget. I have never said that any other budget was the best budget that had ever been introduced, but I do say that about this one. I have perused it carefully since its presentation. I find that many of the complaints that were raised by the two Opposition members who have spoken tonight can be met by reference to the Budget itself. Let me mention one of them. Senator Cole said that in order to solve the unemployment problem, finance should be made available immediately by the Commonwealth Government, through State governments, to local authorities. When we look at the Budget speech of the Treasurer we find that he said -
We have also told the State governments that we would be willing to agree to an increase of £5,000,000 in the borrowing programmes of local authorities and the smaller semi-governmental bodies so that their rates of expenditure on employment-giving works may be stepped up.
The Government intends to take immediate action to relieve some of the unemployment that we have at the moment. If the figures are analysed, the amount suggested will provide work for ten weeks for 33,000 people. Other measures are to be adopted. Additional finance is to be made available for housing. The loan money available to the States is to be increased by £21,000,000 and the tax reimbursements to the States have been increased by a similar figure.
When this £5,000,000 is spent, the additional moneys that are to be made available will continue to help relieve unemployment.
I turn now to another statement of the Leader of the Opposition in order to show just how far wrong one can be. He asked, “ What has this Government done for the farmers and for the great primary industries of Australia? “ He pointed out that the Government proposes to allow as a tax deduction moneys spent on putting in underground pipes. He said that it will not amount to anything this year but will amount to £50,000 in a normal year. He also said that people who have to dispose of stock that have chronic ailments can spread the compensation payments over a period of five years and that the total annual cost would amount to something more than £100,000. Let me point out what provision has been made in the Budget for the farming community.
– Senator McKenna referred to mining, too.
– I shall come to that later. There is a little difference between mining and farming, you know. The biggest single item for which provision is made in the Budget to assist the farming community is the Commonwealth’s contribution of more than £13,000,000 to the Wheat Prices Stabilization Fund. The Government has already made available the sum of £3,000,000 to allow guaranteed payments to be made to growers for the 1959-60 crop. The dairy produce bounty will be £13,500,000, the same as it was last year. In addition, to assist the Queensland Government and to enable cattle to be transported to the ports or the meatworks, £650,000 is to be made available for the construction of a road from Julia Creek to Normanton. Another £350,000 is to be made available for developmental road projects in the Northern Territory. So far, I have referred to only a few of the relevant items.
Also, the meat industry will benefit from this Government’s decision to exempt from sales tax live-stock road trains, complete trailers, semi-trailers and live-stock carriers. Farmers, together with the rest of the community, will be able to save expenditure as a result of the reduction of sales tax on many household goods and the reduction of customs duty on motor spirit. Other items in the Budget which will assist primary producers include the provision of additional capital for the Commonwealth Development Bank, amounting to £5,000,000, and an increase of £4,000,000 in Commonwealth aid roads grants.
– Tell us why they need this assistance.
– I am only trying to show honorable senators how stupid are some of the statements that are made in this chamber. The Leader of the Opposition said that the only help primary producers can expect to receive from this Budget will amount to less than £200,000, but I have enumerated items amounting to some £20,000,000 or £30,000,000.
– That does not help the private farmer.
– Nothing helps the farmer, according to you. The contribution of £13,000,000 to the Wheat Prices Stabilization Fund alone is no mean item. It is far more than the Labour Party would give if it were in office. I congratulate the Government upon its decision in relation to the construction of a standard gauge railway from Kalgoorlie to Kwinana, and a spur line from Koolyanobbing to Southern Cross, at a total cost of approximately £41,000,000.
– Yes, for the Broken Hill Proprietary Company Limited.
– Subject to this sum of £41,000,000 being made available, the Broken Hill Proprietary Company Limited has agreed to spend a similar sum on the establishment of an integrated steel mill at Kwinana. This is the biggest single project that has ever been undertaken in Western Australia.
– It ought to be the turning point in the history of Western Australia.
– I and my colleagues from Western Australia believe that this will be the turning point in Western Australia’s history. We believe that with the establishment of such undertakings Western Australia, instead of taking manufactured products from the eastern States, will be able to compete in eastern Australia against established industries. I repeat, Mr. President, that I believe this project marks the beginning of a new industrial era in Western Australia. The standardization of this line will change Western Australia completely.
Western Australia has a greater agricultural potential than has any other State in the Commonwealth. If you look at the figures, Mr. President, you will find that in the last 25 or 30 years Western Australia’s sheep population has quadrupled. The increase in Western Australia has been four times as great as it has in the next best State.
– How do you account for that?
– You have used our money, too.
-I have not time to-night to reply to interjections. I congratulate the Government upon its recent decision to endeavour to increase Australia’s export income by lifting the embargo on the export of iron ore. I should now like to refer to a statement made by Sir Arthur Fadden which has been published in the press. He said that the iron ore deposits at Mount Goldsworthy near Port Hedland in Western Australia are not of sufficient quantity or quality to capture the interest of the Japanese steel mills or his company. Knowing Sir Arthur as 1 do, and having had great respect for him as a Treasurer, I believe that the person who informed him that the iron ore deposits at Mount Goldsworthy were not of sufficient quantity or quality to justify their development was quite incorrect in what he said.
The State Mines Department has- carried out tests on the deposits. I know some thing about this matter, and I can assure honorable senators that, if the State Mines Department says there are 30,000,000 tons of ore in a deposit, there are no fewer than 50,000,000 tons. The department always plays on the safe side. If a State Mines Department geologist says that the iron content of the ore is 60 per cent., we can be assured that’ it is not less than that. I regret that this statement has been made by Sir Arthur. I believe there are people who will tender for the handling of this ore.
I come now to the Government’s decision to make finance available for the development of ports in New South Wales to export coal. We in Australia must do everything possible to increase our export income. I say that particularly in view of the recent decision of the British Government to negotiate for entry to the European Common Market. If. Britain joins the Common Market, we will have to look for every possible market outside Australia in order to sell our goods. We need efficient port facilities to handle those goods. Mr. President, I congratulate the Government upon its Budget.
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.
Question resolved in the affirmative.
Senate adjourned at 11 p.m.
Cite as: Australia, Senate, Debates, 30 August 1961, viewed 22 October 2017, <http://historichansard.net/senate/1961/19610830_senate_23_s20/>.