23rd Parliament · 3rd Session
The PRESIDENT (Senator the Hon. Sir Alister McMuIlin) took the chair at 3 p.m., and read prayers.
Senator McKENNA. - I address a question to the Leader of the Government in the Senate. In view of the fact that the daily “ Hansard “ for the House of Representatives proceedings of yesterday was cut when Mr. Drummond began to speak at 10.20 p.m., will the Minister, in view of the interest in that speech, arrange for copies of it to be made available to members of the Parliament as early as possible?
Senator SPOONER. - I do not know whether it is practicable to meet Senator McKenna’s wishes, but I shall certainly make endeavours to do so. Having heard what my colleague, Senator Paltridge, has to say on this matter, I for my part will be very interested to sec in detail what Mr. Drummond said.
– My question is addressed to the Minister for National Development and also concerns him in his capacity as Minister representing the Minister for Trade. Has he noted that this week General Motors-Holden’s Proprietary Limited is advertising that it is now shipping from Tasmania its 30,000th export car-
– From Tasmania?
– Did I say from Tasmania? I meant to say from this island continent of Australia. Has the Minister noted this contribution by the General Motors organization to the main artery of Australian export trade? Can he say how that export trade compares with exports of other manufactured goods during the last twelve months?
– I am certain that when Senator Wright referred to these exports as being exports from Tasmania it was a case of coming events casting their shadows before them. I am quite certain that Tasmania will, in due course, make a contribution to our export earnings. Yes, I have seen figures for exports by the
General Motors company from time to time. I do not retain the figures clearly in my mind. I know that for some considerable time past the company has maintained a conscious policy of expanding its export business. I know that the company regularly publishes figures showing the results that it has achieved. I know that the company has made a substantial contribution to our export earnings. The company’s export programme has lived up to expectations. I would like to see the company doing even better than it is doing in the field of exports. I believe that there is scope, for it to do better in the future than it has done in the past.
– Is the Leader of the Government in the Senate aware that 50 years ago to-day Mr. King O’Malley, that great Labour member for the division of Darwin, as it was then known - it is now the electorate of Braddon - in Tasmania first introduced a bill in the Commonwealth Parliament to establish the Commonwealth Bank? Does the Government recognize this day as of special significance, considering that the bill introduced by Mr. King O’Malley proved to be a powerful and beneficial factor in the Australian economy and in the lives of the people of Australia? Does the Government acknowledge the great foresight shown by the late Tasmanian representative?
– My knowledge of history is not as good as that of Sena. or Poke. I did not know that to-day was the fiftieth anniversary of the introduction of that legislation by Mr. King O’Malley. That event is clear evidence of the fact that, even with the Australian Labour Party in office, occasionally good things occur in Australia. His action in introducing that legislation was a very notable step forward. The Senate is indebted to Senator Poke for reminding us of it.
– Can the Minister for National Development give the Senate figures showing exports of coal at the present time compared to those of a few years ago?
– I have some figures before me, and I think it will be interesting to place them on record. In 1947-48, we were exporting coal at the rate of 53,000 tons a year. By 1957-58, our exports had risen to 768,000 tons a year, lt is expected that by 1965 we shall be exporting 3,000,000 tons a year. Three collieries in the south coast area of New South Wales have between them contracts for the export of 3,000,000 tons of coal over a period of five years, and this will yield us export income amounting to £13,000,000. Another colliery has a five-year contract for the export of 410,000 tons, which will provide an export income of approximately £2,000,000. In the Burragorang valley two colliery groups have contracts for a five-year period covering the export of 3,000,000 tons of coal, which will mean an export income of £12,000,000. So we have firm contracts for the sale overseas of 6,410,000 tons of coal from New South Wales, with an estimated income of £27,000,000.
I state those figures with a good deal of pride and satisfaction because it seems only yesterday - I think that an honorable senator sitting opposite me will remember this, too - it was thought that it would not be practicable to export coal. When it is remembered that the production of a miner is about 1,000 tons a year, it will be noted that this export trade will not only yield us very substantial export income, but will also provide a very big source of employment in the coal-mining industry.
– I ask the Minister for Civil Aviation whether he will comment upon a statement that has been attributed to Mr. Drummond, the honorable member for New England, in relation to a conference between the Minister and representatives of East-West Airlines Limited in July last year, and which is in the following terms: -
I can definitely say the Minister said to the members of the company that they would have to get together with Ansett.
– Yes. When I answered a question in the Senate yesterday in respect of this matter of East-West Airlines Limited I pointed out that I saw Mr. Pringle when he visited Canberra late in July or early in August of last year. I told the Senate that East-West Airlines Limited was proposing to see AnsettA.N.A. and indeed had asked me to arrange for that meeting. My refusal to do that resulted in a further request from EastWest Airlines by letter, which I also refused.
During the interview, as I stated yesterday, Mr. Pringle referred at length to the reasons why his company had rejected a take-over offer made by Ansett-A.N.A. some time before that. I indicated that the offer was then regarded by me as having expired, as in fact it had. I told Mr. Pringle that now that the offer had been declined, and that the two airlines would be operating side by side in New South Wales, the Government would expect, and would look for, a degree of sensible cooperation and self-assistance as between the two of them. It was at this point that Mr. Pringle informed me that his directors were proposing to have discussions with AnsettA.N.A., and he indicated the types of things that they wanted to talk about. As an example, Mr. Pringle stated that they wanted to talk to Ansett, or his organization more particularly, about the existing route pattern to see whether it could not be improved, with a consequent improvement in the profitability of both airlines. He was particularly interested in obtaining more maintenance for his workshops at Tamworth, if he could get it, and he wanted to explore with the Ansett organization the possibility of getting that type of work.
I had mentioned that that was the sort of thing that was looked for by the Government, and I indeed may well have said, as I believe Mr. Drummond has quoted me as saying, “ You ought to get together with Ansett-A.N.A.” That is what Mr. Drummond heard. He did not say during his speech that he heard me say - indeed, he has denied having heard me say - anything in relation to a take-over bid or an amalgamation. The point that Mr. Drummond obviously was referring to was my interest, and, indeed, my euthusiastic interest, in this company getting together with Ansett-A.N.A. for the purpose of working out these various economies. As a result of what I said, or more accurately, following what I said, and following my advice that this company should get in touch with Ansett-A.N.A., a conference was held.. It was held at Brampton Island, as requested by East-West Airlines, in accordance with the information that I gave to the Senate yesterday.
Now, Sir, I pass from that particular point, which has been referred to by the honorable senator in his question, to say to him that subsequent to that interview about which he has asked, there has been an exchange of correspondence, extending over fourteen months, between Mr. Shand and me. We have spoken on the telephone on a number of occasions. There has been an exchange of correspondence between my director-general and Mr. Shand, in much greater volume than that which has passed between me and Mr. Shand. There have been frequent telephone conversations about the day-to-day organization of the management of an airline. But not until fourteen months after this interview in July of last year was it intimated to anybody that Mr. Shand, or East-West Airlines, took the view that I was trying to influence that company to accept an offer that had been made by Ansett-A.N.A. eighteen months previously. Not until fourteen months had elapsed was it stated that I was doing that or was trying to do that. I was the villain of the piece, but I was not acquainted of my villainy for fourteen months. Not until 18th August of this year did Mr. Shand, in writing - not to me, but to my director-general - refer to this villainy of mine.
The honorable senator will doubtless bc interested in the strange coincidence of the dates. For fourteen months there was nothing but silence about what I was doing, but in August of this year, a few weeks before the New South Wales Government decided to take action in respect of the re-allocation of air routes in that State, Mr. Shand suddenly decided that eighteen months previously I was bringing pressure to bear on him to accept a non-existent take-over offer. 1 say to Senator Cant, who is not without some political acuity, that it is obvious to every one who sits in this chamber, even if it is not yet obvious to the general public, that this is a piece of politics, the infamy of which is pretty well unrivalled in the history of this country. For the further benefit of Senator Cant and those who sit with him on that side of the chamber, let me say that tonight 1 shall have the pleasure of tabling the papers in connexion with this matter, so that they, the press and the public may know the whole truth of this thing.
– I wish to ask a question of the Minister representing the Minister for External Affairs regarding the proposed visit of Her Majesty the Queen to Ghana, where monarchy, law and liberty have been replaced by a so-called republic which is actually a dictatorship maintained by terror. Has the Government received an independent assessment by the Australian representative in Ghana of the wisdom or otherwise of such a visit by Her Majesty at the present juncture? Will the Government consider this matter carefully and do everything possible to ensure that Her Majesty the Queen of Australia will not be asked to run an unreasonable risk in order to satisfy the present policy of the United Kingdom Government, since the person of the Queen concerns not the United Kingdom alone but every free nation in the British Commonwealth?
– I think that a question with the same general content was asked of the Minister for External Affairs fairly recently in another place. Senator McCallum will find the answer to that question in “ Hansard “. The answer was to the effect that the main considerations in this matter were considerations between the governments of the United Kingdom and Ghana, although the Australian Government had been kept constantly informed of the views of bo.h of those governments. I do not think I can add anything to the general reply that was given by the Minister for External Affairs. If Senator McCallum wishes to go further into this matter, I suggest that he have a talk with the Minister for External Affairs himself.
– Has the Minister for National Development seen a press report which states that there was an increase in the number of homes built in New South Wales in the last quarter, and that those interested in the home-building industry in that State are confident that the target set for the current year will be reached, if not passed? Is not this further proof of the success of this Government’s economic policy? Is it not likely, in view of Australia’s currently increasing prosperity, that even more homes will be built throughout Australia in the next year?
– The housing figures were issued only this morning. I have them on my table but I have not had a chance to examine them in detail. I had a quick look at them, and they left me with the impression that the position was showing up satisfactorily. The figures apply to approvals and not to actual commencements. The first thing I noticed was that the value of approvals for all building operations throughout Australia for the month of September exceeded £53,00,000, close enough to the level of September, 1959. I received the satisfactory general impression that the level of approvals for all building operations, whether homes or factories, was being very satisfactorily maintained. 1 had a quick look through the figures dealing with houses and flats for each State. I am sorry that I did not have sufficient time to make a detailed examination, but my general impression was that those figures also were satisfactory.
– I direct a question to the Minister representing the Postmaster-General. Is the Minister aware of the gradual deterioration in the standard and variety of radio programmes since the advent of television? Insofar as radio plays have been practically eliminated and replaced by recorded popular music, most of it imported, will the Minister consider the reduction of radio listeners’ licence fees to correspond to the juke box standard of programmes?
– This matter has been before the Senate several times lately. If I can quote the Postmaster-General correctly, I understood him to say that since the advent of television, radio programmes have been passing through a transitional period. 1 understand from what he said that he is confident that radio will assume its former importance. Rather than suggest that radio listeners’ licence fees should be reduced, I would suggest to the honorable senator that the Postmaster-General’s objective will be to see that radio programmes themselves get back at least to the former high level that achieved such a reputation for radio programmes in Australia. I am not prepared to admit that programmes have even fallen from that high pedestal of grace, but I know that the department and the Postmaster-General are determined to do everything possible to bring to the vast number of people in this country who will not be in a position to receive television for some time to come a high standard of radio programmes. So I suggest that the Postmaster-General will not consider reducing licence fees but rather will bend his efforts towards improving the standard of programmes.
– My question is directed to the Minister for Civil Aviation. Has the Premier of New South Wales yet told the Minister the name of the person or firm who the Premier was reliably informed was making a bid in recent times for East-West Airlines?
– No. I have not yet heard from Mr. Heffron. I said yesterday that 1 did not think I would. I still do not think I will.
– Is the Minister for Civil Aviation aware that the British Overseas Airways Corporation, according to its chairman, expects to lose something of the order of £6,000,000 this year, mainly through a big fall in passenger loading in the Atlantic area? As Qantas Empire Airways Limited is closely associated with B.O.A.C. and the two companies fly over a number of similar routes, has the Minister any comment to make on the position of Qantas against that background? Does the Minister think that if a big loss is looming through failure to fill seats some consideration should be given to lowering fares, especially economy class fares?
– It is correct, as mentioned by Senator Laught, that in the last financial year the British Overseas Airways Corporation sustained quite a largeloss. Like all other international airlines, B.O.A.C. felt the effect of a quite severe decline in passenger traffic in the latter part of last year. . .
– That happened in Australia.
– lt was worldwide; it was not restricted to Australia, as the next part of my answer may reveal. The honorable senator will recall from the accounts of Qantas Empire Airways Limited, which were tabled in this place recently, that the dividend was reduced to 34 per cent. The budget figures for this year envisage about a break-even figure, or a little above a break-even figure. So, by and large, Qantas, although affected in common with all other operators, is doing rather better - or rather less badly, 1 suppose I should say - than many of the other operators. The question of tourist or economy fares is one which constantly engages the attention of international operators. I have no doubt that the conference of the International Air Transport Association currently being held in Sydney will devote its attention to that problem.
– My question is directed to the Minister representing the Minister for Shipping and Transport. I remind him that since the middle of 1957 no fewer than five vessels have been lost in Tasmanian waters with the loss of some seven lives. Can the Minister say whether or not any steps have been taken by the Navigation Section of the Department of Shipping and Transport to assist in raising the standard of survey for the safety of intra-state vessels in order to prevent a continuance of the loss of unsafe ships?
– I recall that after the loss of a vessel, which involved the loss of life, some three or more years ago, the Tasmanian Government consulted the Navigation Section with a view to seekirg the assistance of that section in renaming the regulations and other matters connected with the control of Statecontrolled shipping. I am aware from my own recollection that conferences were being held. I am afraid that I cannot tell the honorable senator now just what points those conferences have reached, but I shall find out and let him know. This is a matter of great consequence and great importance. It excited the attention of the Commonwealth long before it excited the attention of the States, and these conferences took place at the suggestion of the Commonwealth.
– I direct a question to the Minister for National Development. 1 refer to earlier questions on the production of oil from coal and the Minister’s reply in relation to the current deliberations of the Coal Utilization Research Committee. I refer also to the sad and untimely death of Dr. R. S. Andrews, chairman of the Victorian Gas and Fuel Corporation, whose great scientific knowledge and vast practical experience were a tower of strength to the committee. Does the Minister intend to appoint a substitute member of the committee? If the committee should decide upon and recommend a particular process for the extraction of oil from coal, could the name of Dr. Andrews be associated with such process in some way, as a memorial to the Australian public service of this world-ranking chemical engineer?
– I pay tribute to the standing, reputation and name of Dr. Andrews. I do not know about appointing some one else to fill the vacancy caused by his death. I should want to think about that a little, the present position being, as I understand it, that the committee has practically completed its work. It has to assemble the information that it has gathered and use it in the production of a report, ft is awaiting some further information that is to come from overseas. I understand that the present expectation is that the report may be presented early in the New Year. Dr. Andrews had such particular qualities for the job that I doubt the wisdom of appointing at this late stage some one else who would have to cover so much of the ground that has already been covered.
I do not want to speak in anticipation of the committee’s report, but the impression I gather is that the committee has come quite clearly to the view that world-wide knowledge, experience and information indicate the very great difficulty of a programme for the production of oil from coal. The committee has turned its mind and attention to other directions in which further work could be done for greater utilization of coal. The suggestion that Dr.
Andrews’s name might be associated v-“th some venture in the coal-mining industry, particularly the brown coal-mining industry, or in the fuel industry, is very appropriate.
– Kas the attention of the Minister representing the Minister for Territories been turned to representations in pictorial magazines over the last two months of the shooting of buffalo in the Northern Territory by, amongst others, parties of people shooting from aircraft? It has been represented to me - I think with substance - that this kind of hunting is apt to cause excessive cruelty to wounded animals that escape death. Can the Minister assure us that the ordinances and regulations of the Northern Territory adequately safeguard the animals from unnecessary cruelty, and that there is adequate policing of the laws in this respect?
– My understanding is that licences for shooting are issued by the Administrator’s office. I recollect that within the last two years there has been a considerable overhaul of the regulations, if not the ordinances, in respect of the taking of wild life in the Northern Territory by shooting. In respect of this particular instance which, as T understand the honorable senator, was reported in a quite recent issue of a publication, I shall make immediate inquiries and let him have the information before the Senate rises.
– I ask the Minister for National Development whether companies drilling for oil in Australia must make available to State departments concerned, to the Commonwealth Bureau of Mineral Resources and to private industry information concerning substances other than oil that may be discovered. If so, of what significance are the discovery of coal at Eneabba in Western Australia and the finding of huge salt deposits adjacent to Broome in the north-west of Western Australia?
– All people who obtain a tenement or a title to search for oil are bound to give detailed information of the result of their work to the State mines department concerned. That is one of the conditions under which licences are granted to companies to search for oil. The liaison between the Bureau of Mineral Resources, the State mines departments and the prospectors is so close that I do not think it would be overstating the position to say that the bureau is well informed of all that takes place, even though the company may not be legally obliged, where the operation is not being subsidized by the Commonwealth, to give such information. I hesitate to express an opinion on the commercial value of the coal deposit discovered at Eneabba or of the salt at Broome. My frequent experience in relation to discoveries of this nature is that if they are not of great value now, they prove to be of value as the years go by. I am informed that the coal at Eneabba is at a fairly great depth, which would make mining operations expensive. The geographical situation and the depth of the salt deposits in the north of Australia make them, I think, more interesting as an indication of geological conditions than as deposits of commercial value - at least at the present stage.
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 Immigration, upon notice -
– The Minister for Immigration has supplied the following information: -
asked the Minister representing the Minister for Health upon notice -
In view of statements that success cannot always be guaranteed in the production of antipoliomyelitis vaccine in Australia, has the Government any plans to import vaccine?
– The Minister for Health has furnished the following reply: -
A batch of 600,000 doses of Salk vaccine, which will be adequate for Australian requirements for some time, is now being prepared at the Commonwealth Serum Laboratories, Melbourne. This is expected to become available during December. There is no reason, at present, to believe this material will not meet the rigid requirements imposed by the Commonwealth Department of Health. However, the Government has for some time been investigating the possibility of importing further supplies in case this batch should not meet expectations, or in case a further shortage should develop later. Difficulties have been, and are being, experienced with Salk vaccine production in Great Britain, the United States, Canada and Japan. For this reason supplies are not readily available overseas. However, the Government has taken steps to obtain supplies from overseas when these become available as a reserve against an emergency.
asked the Minister rep resenting the Prime Minister, upon notice -
– The Prime Minister has supplied the following answers: -
asked the Minister representing the Minister for Trade, upon notice -
-The Minister for Trade has supplied the following answer: - 1 and 2. The Commonwealth Statistician has advised that imports of canned poultry were not separately recorded before 1st December, 1960. On preliminary figures, imports of canned poultry totalled 938 tons in the seven months ended June, 1961, and15 tons in the two months ended August, 1961. Most of the imports were from the United States of America. The Statistician has estimated that the apparent consumption of poultry in Australia in 1959-60 was 43,923 tons or 9.7 lb. per head of population. The rates of duty applying to imports of poultry into Australia are as follows: -
The Tariff Board has recently completed an inquiry into the question of the industry’s tariff protection. The board’s report has recently been received by the Government and is being examined.
asked the Minister representing the Minister for Trade, upon notice -
– The Minister for Trade has provided the following answer to the honorable senator’s questions: -
The Commonwealth Statistician advised me that-
Imports of tall oil into Australia were -
asked the Minister representing the Minister for Primary Industry, upon notice -
– The Minister for Primary Industry has supplied the following answers:-
– I pre sent the report of the Public Works Committee relating to the following proposed work: -
Construction of a Permanent Barracks and Administrative Accommodation at H.M.A.S. “ Kuttabul “, Sydney, New South Wales.
As the subject-matter of this report has raised a certain amount of comment, I ask for leave to- present the full views of the committee.
– There being no objection, leave is granted.
– by leave- The committee inquired very closely into the proposal of the Department of the Navy for the construction of barracks at H.M.A.S. “Kuttabul”. It examined the site of the proposed construction and most of the adjoining naval establishments. H.M.A.S. “Kuttabul” is part of the naval complex which comprises the head-quarters of the Flag Officer-in-charge, East Australia Area, establishments at Balmoral, South Head, Rushcutter Bay and Neutral Bay, the torpedo range at Pittwater, the dockyard and hydrographic service at Garden Island, the air station at Nowra, the shore wireless station at Canberra, armament depots at Newington and Kingswood, and fleet storehouses at various localities in the Sydney area. It will be seen that we have been dealing with a very important administrative centre of the Navy in the East Australia Area. The complement of H.M.A.S. “ Kuttabul “ also includes the command signal centre, the electrical equipment and trials unit, the reserve fleet, the tenders pay office and the fleet clothing store.
At present “ Kuttabul “ is unable to provide any domestic accommodation for personnel from ships under refit and for all head-quarters’ staff. The committee found that the domestic accommodation which was available was of poor standard and that accommodation to carry out the administrative functions was in temporary buildings. The committee found also that the absence of shore-based accommodation made it imperative for ratings from ships undergoing refit at Garden Island to live aboard the vessels. They are subjected to very high noise levels and have to put up with the inconvenience of having limited use of bathrooms and restricted or shutdown ventilation. I should like the Senate to realize that in the past while ships have been undergoing refit the personnel have been obliged to live inside the vessel while it has been in dock. I think every one will agree that, judged by modern standards, such conditions are intolerable.
We also found during our investigations that for approximately half of the period of refit a ship is inside the dock itself. The presence of a ship’s company and the necessity for living space and amenities to be provided for them on board hampers the dockyard force in the refitting work and demands the employment of many members of the crew, who otherwise would be engaged on refitting, in providing light, power, cooking and administrative services. It will be seen, therefore, that at present H.M.A.S. “ Kuttabul “ is unable to provide domestic accommodation for personnel of ships under refit. The committee found that the need to find accommodation ashore for crews of ships under refit is becoming more pressing.
Our inspection revealed a poor standard of accommodation at “ Charlemont “ and inadequate dining, cooking and recreational facilities. In addition, the building is costly to maintain and is unsuitable for conversion to modern living accommodation. As I have already mentioned, the temporary buildings which are at present on the site of the proposed building have a limited economic life. While they remain, the site cannot be developed to maximum advantage. The committee is convinced that provision should be made for the crews of ships undergoing refit at Garden Island to be accommodated ashore. By observation, and from the evidence presented, it has been concluded that living quarters for shore-based ratings and administrative accommodation for the activities associated with head-quarters for the eastern Australia area require replacement. There is, therefore, an urgent need for permanent barracks and administrative accommodation.
During the course of the committee’s inquiry it considered views presented by representatives of the Sydney City Council. Those views were very closely considered in all respects. Evidence was heard from representatives of the council and also of the Cumberland County Council. The committee concluded that no valid case had been made against the construction of the building as sited, and of the dimensions proposed. The committee accepted in principle the design for the building, including the provision of five lifts. This was a matter of contention, and after hearing expert evidence on the provision of a proper peak-load service for lifts, the committee recommended accordingly.
The committee found during its investigations that there was room on the site for additional living accommodation should it be required in the future. The estimated cost of the proposal as submitted to the committee is £985,000, while other associated costs will increase that amount to £1,061,000.
I wish to point out, Mr. President, that much of the press criticism that was voiced during the committee’s inquiries was based on the contention that the committee could not find qualified people to give evidence. We heard evidence from representatives of the Sydney City Council, the Cumberland County Council and the Real Estate Institute of New South Wales, as well as from other people who have directed their attention specifically to matters such as those being considered by the committee. We came to the conclusion that the proposed building was not only warranted, but was urgently needed.
During the course of our inquiries we came up against the traditional problem of the segregation of ranks in the Navy. The problem arose in relation to the provision of lifts. The committee took the view that it was not its responsibility to lay down Navy policy or government policy, but to examine all the factors associated with the proposal that had been referred to it, and to report back to the Parliament. We feel that we have carried out that task. We have endeavoured, as representatives of the Parliament, to present a report that will give as clear a picture of the proposal as it is possible to obtain, after hearing evidence from witnesses who, we felt, were able to contribute constructive views.
I am of opinion that the Department of Works has prepared a most suitable design, and that the proposed building will meet the requirements of the Department of the Navy, the client department. I wish to thank those members of the Public Service, and also the representatives of various private organizations, who appeared before the committee and gave evidence. Many of them sacrificed valuable time to do so, at no cost whatever to the Government, and they all gave most interesting and worthwhile information to the committee to assist it in its deliberations.
Ordered to be printed.
– Ilay on the table of the Senate the following paper: -
Advance to the Treasurer - Statement for the year 1960-61 of Heads of Expenditure and the amounts charged thereto pursuant to Section 36a of the Audit Act 1901-1960.
That the statement be considered in Committee of the Whole.
– On behalf of the Public Accounts Committee,I present the following reports: -
Fifty-seventh Report - Treasury Minutes on the Twenty-fourth, Twenty-ninth, Thirty-sixth, Thirty-seventh, Forty-third, Forty-seventh and Fifty-first Reports; together with Summaries of those Reports;
Fifty-eighth Report - Reports of the AuditorGeneral - Financial Year 1960-61.
Of these two reports, the fifty-eighth is the last to be presented by the fourth committee. The committee is pleased to acknowledge the assistance it has received from departmental observers and witnesses, and from the Principal Parliamentary Reporter and his staff. Attention is invited to the final chapter in particular, where the committee has recorded its appreciation of the outstanding work done for the Parliament and for the committee by the honorable member for Warringah (Mr. Bland).
Ordered to be printed.
– by leave - Apropos of the report of the Public Works Committee presented by Senator O’Byrne, the deputy chairman of the committee. I wish to refer to an article published in the Sydney “ Daily Telegraph “ which arrived in Canberra at lunchtime to-day. The article referred to an interview given to a representative of the newspaper by the honorable member for Gellibrand (Mr. McIvor), a member of the committee, in which he protested against what he termed segregation in the Royal Australian Navy. I point out that the matter of segregation did not come within the terms of reference forwarded to the committee by the Minister for the Interior (Mr. Freeth). The terms of reference included consideration of the site of proposed barracks for the Royal Australian Navy at Potts Point, adjoining Garden Island, the type of building, and the economics of its construction.
– What was the nature of the segregation?
– The segregation complained of by my colleague on the Public Works Committee is that it is proposed to make a division in the lifts in the building between chief petty officers on the one hand and ratings on the other. Such a division is customary practice, not only in the Royal Australian Navy, but also in the navies and armed services of other countries. There is always a division between what may be called the top-ranking officers and the sergeants, for instance, in the Army, and there is also a division between the noncommissioned officers and the private soldiers. The Navy is merely observing an old navaltradition by keeping the ranks in divisions. That is what my colleague has referred to as segregation, and that is what he has complained about in rather strong terms to the “ Daily Telegraph “. The newspaper report claimed that the estimated cost of the naval barracks is £1,500,000. That is absolutely incorrect. The actual estimated cost, as given in the report of the committee, submitted by Senator O’Byrne, is £985,000.
The report stated, also incorrectly, that two lifts for use by chief petty officers will cost about £70,000 each, and it went on to say that the ratings will have three lifts. First, it is absolutely wrong to say that the two lifts mentioned will cost about £70,000 each. Secondly, the inference could be drawn from the report that, as two lifts will cost £70,000 each, the cost of each of the other three lifts will be much the same. The impression could be left in the minds of many unthinking readers of the report that the total cost of the five lifts will be something like £350,000, which is palpably absurd. The total cost will be £75,000. There is a big difference between the actual cost and that which could be inferred from the statement alleged to have been made by Mr. Mclvor.
The complaint was made that 300 ratings will be required to sleep in dormitories. They will be good dormitories, of first-class construction, of good size and properly fitted out. At present, ratings from ships that are in the dock for refit are obliged to sleep on their ships. Therefore, there will be a big change for the better when the dormitories are ready.
It was alleged that there was some trouble with the local government authorities - the Sydney City Council and the Cumberland County Council. Let me say that the Public Works Committee observed all the legal requirements for the erection of the building. Nothing illegal was done. Nobody became red in the face over anything that the committee did. We courteously invited an officer of the Sydney City Council and an officer of the Cumberland County Council to come before us. They were very mild in their statements. They said that objections could be raised, but they would be very minor. In point of fact, the committee had no written communication from either the Sydney City Council or the Cumberland County Council offering any kind of objection to the proposals made by the Navy, as adopted by the committee.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Spooner) read a first time.
– I moye -
That the bill be now read a second time. The purpose of this bill is to seek the approval of the Parliament to a grant of financial assistance to the State of Queensland for the purpose of the construction of beef cattle roads in that State. In February last, the Prime Minister (Mr. Menzies) announced the Government’s interest in a number of large enterprises which would assist with development and increase export earnings. Included in the list was “ Road development in the north, including north and west Queensland, the Northern Territory and the north of Western Australia “. Following a very careful examination of the whole question of road requirements in the north, and consultation with the States concerned, the Government decided on an immediate programme of assistance in all three areas. The current Budget includes a special allocation of £350,000 designed to speed up road development in the Northern Territory, and we have also agreed to a special grant to Western Australia, which is the subject of another bill. The present measure covers the assistance which the Government plans for the State of Queensland.
It is perhaps unnecessary to stress the great importance of transport to the development of our sparsely populated northern areas, or to dwell for long on the part played by the beef cattle industry in those areas and on the significance of beef as an export-earner. These facts are well known, and there is also general acknowledgment of the further fact that droving as a means of moving cattle from place to place is rapidly being superseded, where suitable roads are available, by the use of motorized road trains. The use of road trains speeds up movement. More importantly, the general availability of road trains has the side effect of promoting quite significant changes in animal husbandry, allowing cattle to be turned off at much younger ages, thus increasing the productivity and overall efficiency of individual properties, as well as producing, in most instances, an end product of higher quality.
Expert economic studies, designed largely to measure the cost of roads against the value of the benefits expected to flow from their construction, have shown that there is great scope in. Queensland for roads expenditure which should produce really worthwhile and, in some cases, spectacular results. Apart from the Queensland section of the Barkly Highway between Camooweal and Mount Isa, there is practically no road in the west and north-west of the State suitable for the regular transport of cattle.
Earlier this’ year, the Prime Minister announced that, as a first step, the Government had agreed to provide £650,000 of the first £1,000,000 spent on the construction of a road between Normanton and the Townsville-Mount Isa railway at Julia Creek. This work is now well under way, aud the 1961-62 Budget has made provision for the Commonwealth contribution of £650,000. However, at Budget-time it was announced that the Government was ready and willing to go much further than this, and in subsequent discussions with Queensland the Government agreed to an allinclusive grant of £5.000,000 to be made over a period of five years for expenditure on approved road .works. ., . ….
In effect, the Normanton-Julia Creek arrangement has been left as it stands, and a further £4,350,000 has been added as a straight-out grant which need not-he matched by corresponding expenditure on the part of the State. Put in another way, if the State spends a total of £5,350,000 on approved roads during the prescribed period, it can qualify for a Commonwealth grant of £5,000,000. If the State spends £5,350,000, the Commonwealth will refund £5,000,000. The money, of course, would be made available progressively over the period to provide for financing of the work as it went along, as well as for ultimate assistance.
The actual roads on which expenditure will qualify for reimbursement will be selected in the first instance, by. the State, but must be approved by the Treasurer. Naturally from a Commonwealth viewpoint we want the funds to be applied to the best advantage, and thus the Treasurer is required to have regard to certain criteria - essentially the effect on beef production and the relationship . between cost and benefits - before giving an approval.
The bill also provides that the Treasurer may approve standards of design or construction, and that if he does so approve then the State must comply with those standards in order to be eligible for 3 grant in respect of the work concerned On this aspect; there is already a very substantial measure of agreement on standards. 1 feel sure that there will be general support for this measure which, in conjunction with other assistance measures’ already before the Parliament or to be introduced should contribute greatly to that development of this country and its resources in which we all believe. I commend the bill to honorable senators.
Debate (on motion by Senator Benn) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Spooner) read a first time.
.- I move-
That the bill be now read a second time.
The purpose of this bill is to seek the approval of the Parliament to a grant of financial assistance to the State of Western Australia for the carrying out of certain road and bridge works in the northern part of that State, connected with the transport by road of beef cattle. In introducing a similar measure relating to roads in Queensland I mentioned the several steps being taken by the Government to assist in the development of roads across the north of Australia. I referred also to the importance of general development and expansion of the beef industry, and the significant role which roads could play. I need not repeat what I then said, as the remarks have general application to Western Australia as well as to Queensland and the Northern Territory.
The assistance proposed for Western Australia is a grant of £500,000 in respect of expenditure by the State in the financial year 1961-62 on two specified roads and two specified bridges in the Kimberleys. The four projects are interrelated in that both roads lead from beef cattle areas to the meat works and port at Wyndham - from Nicholson in one case, from Halls Creek via Turkey Creek in the other - while the two bridges will allow the Wyndham-Nicholson road to be taken across the Ord and Dunham rivers and so eliminate an existing low level crossing over the Ord, which puts this road out of commission in times of flood. Incidentally, the bridges, one of which is to be superimposed on the Ord River Dam at Bandicoot Bar, which itself is being constructed with the assistance of Commonwealth funds, and the improved road between the Ord Dam and Wyndham, will be of great assistance in the development of the areas opened up for settlement by the Ord project.
When we discussed the question of roads with the Western Australian Government, we were impressed by the amount of self help in developing communications in the north being undertaken by the State from its existing road funds. As the Prime Minister announced when it was decided to assist the State, the Commonwealth grant is “ matching corresponding provisions by Western Australia in relation to roads in the Kimberleys “. This concept is written into the bill, which requires the State to undertake to spend not less than £500,000 from other sources on road works in the northern part of the State - defined as north of 20 degrees of south latitude - during 1961-62. I might add that this is by no means an onerous provision, as the information provided by the State indicated that its 1961-62 programme of road works included an allocation of more than £1,000,000 to that area, including over £800,000 in the Kimberleys.
The detailed arrangement is that the Commonwealth will provide 50 per cent. of expenditure on the two bridges in 1961-62 - estimated at £320,000, and calling for a Commonwealth contribution of £160,000 - and the whole of the expenditure, also in 1961-62, on improving the two roads. If the expenditure on the bridges accords with the estimate, this will mean that £340,000 is available for the road works. However, within the agreed limit of £500,000, expenditure limits on either of the two groups have not been specified. I might mention also that the availability of the Commonwealth grant will allow the State to release, for other road works in the area, the funds already allocated in its programme to the two roads, plus half of the amount allocated to the construction of the two bridges.
Other provisions in the bill are similar to those in the Queensland measure, including the power of approval of standards of design or construction which the Treasurer may exercise. Western Australia is receiving very substantial assistance from the Commonwealth in its railway plans, which essentially will benefit the southern part of the State. This measure provides for a considerably smaller, but nevertheless significant, grant of assistance to the far north. 1 commend the bill to honorable senators.
Debate (on motion by Senator Cant) adjourned.
D:-bate resumed from 24th October (vide page 1436), on motion by Senator Paltridge -
Thai the bil] be now read a second time.
.- Before the adjournment of the Senate last night we were considering this bill which provides special assistance for the two States of Tasmania and Western Australia pursuant to the recommendations of the Commonwealth Grants Commission. This is an important occasion in Federal-State finance because we are considering this bill at the close of an era of post-war federal finance when the States finally surrendered, I believe, their right to the completely independent responsibility of raising revenue to service their governments. I think they surrendered that right by the agreement that was made in 1959. Therefore, to consider this bill in that context demands more than usual care.
In a very valuable paper that has been supplied to us by the Commonwealth Treasury, giving to some extent the history and statistics of Commonwealth payments to or for the States under analytical headings and over the period since federation, it has been truly noted that since the Second World War there has been a marked increase in the amount and variety of Commonwealth assistance to the States. The main factors responsible for that increase have been, first, the introduction and continuation of uniform income tax which was ushered in, one remembers, as the initiation of the steep war expenditure in 1942. The second factor has been, as the Treasury puts it, the increase in Commonwealth responsibilities. The Commonwealth Treasury is a great promoter of the idea that the functions of the Commonwealth Government must necessarily expand. Thirdly, the increase is attributed to the rapid growth of the Australian economy. Under that heading the paper notes the need to provide supplementary advances in connexion with the loans to be raised year by year.
Under various headings the direct Commonwealth financial assistance to the States is assembled for our consideration; first, the grants for general revenue purposes; and secondly, payments for specific purposes. Examples of the latter payments are, first, payments of a revenue nature such as payments under the Financial Agreement and in aid of the universities; and secondly, payments for purposes of a capital nature, such as Commonwealth aid for roads, railways standardization, beefcattle roads, Western Australian water supply, mental institutions and tuberculosis hospitals. Thirdly, there is assistance ;o ‘ the Loan Council borrowing programme.
When we consider all of those payments we see the degree to which the Commonwealth is providing increased amounts of money for the States, as shown by figures on page 45 of that paper. The total Commonwealth payments to or for the States in assistance to the Loan Council borrowing programme have increased from £165,100,000 in 1951-52 to £394,700,000 in 1961-62. After allowing for the growth of the Commonwealth, the increased economic activity and trade and the inflated value of the £1, those figures indicate the increasing dependence of the State on Commonwealth assistance.
If honorable senators look at page 41 of the paper provided by the Treasury, they will see that in the present year Tasmania is to receive £20,287,000 under the heading of general revenue grants. The financial assistance grant is. £11,980.000; and the special grant is £4,309,000; making a total of £16,200,000. Under the heading of specific purpose payments of a revenue nature, such as Financial Agreement payments and some part of the university subvention, Tasmania receives £1,352.,000. Under the heading of payments for specific purposes of a capital nature, Tasmania receives £2,646,000. Those three figures total £20,287,000. The budgeted expendi- lure for Tasmania this year is £29,900.000.
So, Commonwealth payments account for not less than two-thirds of the budgeted expenditure of Tasmania. I have cited those figures in order to have registered the degree to which the Tasmanian Government, by agreeing to the 1959 formula, has surrendered the right to raise its revenues independently of the Commonwealth, and by its own responsibility and authority.
It is satisfactory to find that the Commonwealth Grants Commission - newly constituted, as Senator McKenna said in the course of his speech last night - has devoted itself to this changed situation. In paragraph 46 of its most recent report, the commission says, “ Clearly a new situation has been brought about “. It goes on to examine the basis of this new situation. It appropriately addresses itself to an inquiry as to whether or not the revised basis of Commonwealth financial assistance under the 1959 formula can be ascertained and, secondly, if ascertained, whether it is relevant in any way to a reconsideration of the principles upon which the commission should recommend grants to the two States which arc beneficiaries under this bill, namely, Western Australia and Tasmania. lt points out that under the 1959 formula, which is the basis of the revised scheme, the amount which the States could ordinarily expect to receive from the Commonwealth would be increased from about £220,000,000 to about £244,500,000. The commission points out that the tax reimbursement payments distributed amongst the various States for 1958-59 show the following per capita” figures: - For New South Wales’, £20 8s. 5d.; Victoria, £19 13s. 3d.; Queensland, £22 7s. 4d.; South Australia, £20 18s.; Western Australia, £22 14s. 2d.; and Tasmania, £21 6s. Id. No principle can be divined as the basis of that distribution.
The report shows the following per capita figures for financial assistance payments for the year 1959-60: - New South Wales, £22; Victoria, £21 5s. 3d.; Queensland, £25 2s. 6d.; South Australia, £29 12s. lid.; Western Australia, £35 2s. 3d., and Tasmania, £31 8s. 5d. If all of these amounts are put in relation to one another and New South Wales and Victoria are taken as having a base of 100, the following relative figures are obtained: -
It is not surprising, therefore, that after consideration of these figures the commission stated -
The payments, therefore, do not reflect the relative sizes of any probable hypothetical independent State revenues nor do they represent any proportion of distribution of Commonwealth lax or other revenue raised in each of the States. They represent, in fact, a re-distribution of such revenues - an inevitable feature of the financial arrangements in a federation.
Then the commission went on to ask whether there was any ascertainable basis for that re-distribution and, if so, whether it had any relevance to the commission’s problems. It found no sound basis for cither of those conclusions.
I should think that that shows that not only was there a completely revised scheme of Commonwealth assistance in 1959 but also that the basis of distribution of financial assistance among the States is not certainly to be related to the needs of the States, the taxable capacity of each State, or the percentage of tax which the Commonwealth now receives by way of income tax and which the States concerned abstain from collecting. I make those points, because in sharing the £244,500,000 which the States were to get under this revised agreement, certain objejctives were placed before the Commonwealth, as stated in the Treasury paper to which I referred, at page 13. Those objectives were, first, to bring some order into what had become a rather straggled payment - the re-imbursement of income tax, plus supplementary grant; secondly, to reduce to two the number of States which will in future continue regularly to apply for special grants recommended by the commission; and thirdly, to arrive at a more generally accepted basis of distribution. It can be seen that those three objectives are not related to any specific amount of tax. They are, in general, merely political objectives, desirable nevertheless, but not related to any particular formula.
With that problem before them the States agreed to the Commonwealth’s proposal that the grants be increased to £244,500,000 and that financial assistance grants payable to each State in succeeding years be determined by adjusting that figure in accordance with the formula based upon movements in the population of States and actual increases in the level of overall wages in Australia as a whole. 1 pause to place emphasis upon that factor, because one of the points for urgent consideration in this new structure is that a chief factor is the level of wages in Australia. That is one of the important factors that will regulate not merely the level of Commonwealth expenditure and Commonwealth revenues but also the amount of federal assistance that must be paid to the six States year by year. Wages, therefore, and wages policy since 1949 are increasingly important as a predominant factor in the public finance of this country. The other part of the proposal was that there should be a betterment factor, allowing for an extra 10 per cent, on that assessment, in order to arrive at an annual rate of assessment. The Commonwealth made clear that on that basis the Commonwealth Grants Commission was expected to operate and determine the grants for South Australia and Western Australia. It is most important for everybody to recall that it was an express part of that treaty between the States and the Commonwealth that the States and their authorities would continue to meet Commonwealth pay-roll tax and that the distribution of taxing powers between the Commonwealth and the States would remain unchanged.
Against that background, the Commonwealth Grants Commission has said, in effect: When we come to recommend a grant to Tasmania and Western Australia, should we, as hitherto, compare the budgetary results of those two States with the formerly regarded standard States of Queensland, New South Wales and Victoria? Or should we compare them with the four non-claimant States, Queensland, New South Wales, Victoria and South Australia? Or should we compare them with Victoria and New South Wales? The Minister, in his second-reading speech, adverted to that part of the commission’s report. He indicated that the tentative conclusion reached by the commission is to be cri .-‘.,1 by the Commonwealth Treasury ne-r’ February. I have read the commissar*’ report and its reasons for adopting Victoria and New South Wales as the standard States for comparison. Having regard to the fact that it is contemplated that only in special circumstances should Queensland and South Australia apply to the commission, having regard to the recognized fact that New South Wales and Victoria are, especially in relation to secondary industry, the most developed States in Australia, and having regard to their taxable capacity and the need to have a simple and certain criterion for comparison, I feel that there is a great deal to support the commission’s conclusion in adopting Victoria and New South Wales as the standard States for purposes of comparison.
The commission next deals with certain adjustments in relation to the budgetary results of the two claimant States. Speaking of Tasmania, the Grants Commission refers to certain adjustments. From page 69 of the commission’s report it will be seen that the adjustments made in respect of Tasmania are -
Adverse in respect of social services expenditure -£204,000.
Adverse for differential impacts of financial results of State undertakings on the Budget - £100,000.
Those are the only two adverse adjustments that the commission recommends. As against that the commission notes a favorable adjustment for Tasmania under the heading of “ Severity of Non-income Taxation “. The favorable adjustment that is credited to Tasmania in that respect is £304,000.
The position is important because recently the Premier of Tasmania, in introducing taxation proposals that are entirely objectionable to me, namely, proposals to tax settlements of property and gifts of property ., by prepayment of probate duties under the form of stamp duty or gift duty, clearly implied that they were prompted by the need to keep the basis of Tasmanian . , finances acceptable to the Commonwealth. ,- Grants Commission. He claimed that Tasmania’s taxes in this respect were certainly lower than those of other States. The Premier’s action has given a totally false impression of the situation, because the Commonwealth Grants Commission has made it clear that Tasmania has an overall higher rate of taxation than the standard
States and so receives a favorable adjustment. That is made clear by the commission in paragraph 38 of its report.
In paragraph 141 of its report the commission states -
The Commission’s calculations show that, in 1959-60, if the claimant Stales had raised taxes al the average rates and with the average exemptions applied in the standard Stales, Western Australia would have raised £320,000 less and Tasmania £270,000 less than was actually raised.
– Why did the Tasmanian Government feel obliged to increase those taxes?
– The Premier of Tasmania has given a completely false impression to the Tasmanian public. The Commonwealth Grants Commission, so far from penalizing Tasmania for lack of effort in the raising pf revenue from non-income taxation sources, has made an adjustment in favour of Tasmania, and has pointed out that Tasmania is raising no less than £270,000 more than she would have raised on a proper comparison of the rates of taxation and exemptions prevailing in the standard States. I wanted to nail that false impression in the hope that it would be destroyed, because if anything is objectionable to me it is this growing disposition of governments to confiscate, by way of capital taxation, property, particularly of families. Gifts as between families are most common and laudable, enabling property to be distributed, and enabling members of the family to function as independent units. 1 hope that the Premier’s argument will be destroyed, and that his. proposals to increase these taxes will fall with his argument.
As a representative of Tasmania I can see no reason for complaint at the amount that is recommended as a special grant to Tasmania this year. In 1958-59, the special grant was £4,400,000. In 1959-60, the -rant amounted to £3,400,000. In 1960-61, the grant was £4,300,000. The grant recommended for 1961-62 is £5,075,000. I congratulate the commission on its report. There is a wealth of material in the report to which reference cannot be made in this debate. The commission is a great agency for establishing the independence of the weaker States of the Commonwealth, and for enabling them to function as members of the Commonwealth. I support the bill.
– The bill before the Senate provides for the granting of about £11,231,000 to Western Australia and Tasmania. For the first time since 1933 the Commonweal’h Grants Commission has not had to deal with South Australia as a claimant State. I wish to place on record my congratulations to South Australia on having achieved independence in this regard. There is some honour to a State in achieving this independence. As Senator Wright has pointed out, the commissioners had to decide the basis on which they would deal with the standard Slates. Formerly, the standard States were Queensland, Victoria and New South Wales. But now South Australia has become a standard State. In paragraph 6 of its report the Grants Commission states -
The claimant S’tates contended that, although there were four non-claimant States in 1959-60, nevertheless the new system of Commonwealth financial assistance payments agreed to at the Conference of Commonwealth and State Ministers in June, 1959, provided for the possibility in exceptional circumstances of either or both of two of those four States making an application for a special grant. Hence, if the appropriate standard were to include ali the non-claimant States, as they existed from time to time, auto,matically or as a matter of course, the basis of the standard might vary as the number of non.claimant States varied.
That is what the commission based its decision on. That would, of course, introduce an element of instability embarrassing to the Treasurers of the claimant States or applicant States, as I prefer to call them. The commission’s report continues. -
This, it was said, would introduce an element of instability embarrassing to” the Treasurer of a claimant State in estimating the State’s likely revenue and in endeavouring to estimate the likely amount of the special grant as finally adjusted by the Commission.
As I said earlier, the Commonwealth Treasury contended that the standard should be based on the average of all the non-claimant States, but the commission held out and pursued the policy of taking two States. The commission was reinforced in its attitude, as is indicated in the following passage from its report: - lt may be added however, that the Commission’s examination of all. the data relevant to 1959-60 indicated that if it had adopted a standard based on all four non-claimant States the figures contained in its final recommendation would not have been significantly affected.
I shall refer a little later to the reasons stated at page 37. of the report for the commission’s decision in relation to Victoria and New South Wales. The passage from which I was quoting a moment ago continues -
Since, therefore, a four-State standard could be adopted-
And it could be adopted - in the next Report in respect of the year 1960-61 without involving any inconsistency with its recommendations in this Report in respect of the year 1959-60, the Commission considers the matter still open for further argument by those concerned.
At page 37 of the report the commission explains why it selected Victoria and New South Wales. The relevant passage reads -
The Commission selects the standard of New South Wales and Victoria, under existing circumstances, primarily because intrinsically it appears as the one appropriate for the relatively long-term development of the claimant States as effective integers in the Australian Federation. The standards of these two selected States are the highest-
That is important - both in the services provided for the citizens of these States and in the effort to raise revenue from those citizens to pay for such services. This, in the view of the Commission, is the pattern of government most truly characteristic of the Australian people and therefore most appropriate for the purposes in hand.
I refer now to a passage at page 46 of the report in which the commission states why Western Australia and Tasmania should receive these special assistance grants. The commission stated -
The more important factors in the case of Western Australia are differing requirements and sparsity of population. Both operate to inflate expenditure on the major services comprising education, hospitals and police. In the case of Tasmania the major factors are differing requirements and, because of the much smaller size of the population, overhead costs of administration.
The legislation makes provision for payment in two parts, the first being a payment of £956,000 to Western Australia as an adjustment of the 1959-60 grant. It is understood by all honorable senators that the sum paid may be higher or lower than the original amount, depending upon when the final budgets for those States are produced. Provision is made also for the payment of £5,200,000 for the current year, making the total payment to Western Australia of £6,156,000, which is considerably greater than last year’s grant.
I think it will not be too long before Western Australia joins the ranks of the standard States and will no longer be an applicant State. I use the word “ applicant “ after having read the report of Senator McKenna’s speech on a similar measure last year. He said he did not like the use of the word “ claimant “. I add that I do not like the use of the word “ mendicant “ either. Both those words are repugnant to me. I propose to take a leaf from the book of the Leader of the Opposition and refer to these States as applicant States. 1 believe that a tribute should be paid to the Western Australian Government for the effort it is making to become ultimately a standard State. Last year the Western Australian Government reduced the loss on the operation of the railways by no less than £1,300,000. That is a fairly substantial reduction for one year.
Just let us consider the works programme. Some projects have been started and tendershave been called for others. I shall mention just a few of the projects that are to be undertaken. The bauxite and aluminium industry, which is to be started very soon, will involve an expenditure of £11,000,000. Extensions to the Kwinana oil refinery will mean the expenditure of £10,000,000, the standard gauge railway project will cost £41,000,000, the Broken Hill Proprietary Company Limited’s iron and steel undertaking will involve an expenditure of £44,000,000, and the ultimate cost of the power station at Collie will be £10,000,000. In addition, the La Porte titanium industry will involve an expenditure of £4,000,000, the sponge iron industry at Augusta will mean an expenditure of £10,000,000, the development of the north-west will account for the expenditure of £5,000,000, legislation now before the Parliament in respect of beef roads provides for the expenditure of £500,000, and expenditure by Australian Paper Manufacturers Limited will amount to £4,000,000. All those projects will involve the expenditure of a substantial sum of money. I quote them in support of my statement that Western Australia will not be an applicant State for too many more years.
– What is the total?
– I have not the total for the projects I have mentioned, but the total cost of works now on the stocks will be £182,000,000. That is a lot of money to be spent within the next eight or nine years.
The Commonwealth Grants Commission is sitting in Perth at the present time. As a matter of fact, Sir Alexander Reid travelled over by ‘plane with me last Friday night. He said in Perth on Tuesday last in respect of the rail legislation that we passed last week that he believed the proposition was economically sound and that the Commonwealth in giving financial assistance to the State was not making a hand-out. The report from which I am quoting further states -
A feature of the submission-
The submission that was made by the State Government to the Commonwealth - was the hard-headed business way in which the proposition was put up. The State Government’s case should be reassuring to the people of the rest of Australia.
That was said by Sir Alexander Reid of the Commonwealth Grants Commission.
– I presume he was speaking off the record.
– No. This was when the commission was taking evidence.
– What was his experience before his appointment to the Commonwealth Grants Commission?’
– I do not know.
– He was the UnderTreasurer in Western Australia.
– The report further says -
The chairman- said that the new theory of grants to States-
I am sure this will interest Senator Wright - was that in a period of fairly intense development the burden of development fell on the States concerned and payment should fall on the Commonwealth. That was a change from the ideas of a long time ago. The burden of development was be,ng carried in the interests of the nation.
The Western Australian Under-Treasurer stated that a special grant would not take care of interest and the repayment of the money advanced to the Western Australian Government. He said that ultimately the project would have the effect of reducing the need for special grants. I agree with him in that respect.
To further substantiate my statement that Western Australia is doing what it can to help itself, I ask honorable senators to consider some trading figures. In 1960-61, Western Australia’s external trade showed a favorable balance of £28,000,000, conpared with an adverse balance of £10,500,000 in the preceding year.
– There was a big wheat harvest.
– Yes, and most of the wheat was sold. The overseas trade balance in 1960-61 was £30,600,000 better than in the previous year. The value of exports was £39,700,000 more, while that of imports was £9,100,000 more. When we turn to the interstate trading results for 1960-61, we see that they were £7,900,000 better than for 1959-60, when the adverse balance was £84,400,000. The improvement resulted from the combination of an increase of £6,300,000 in exports and a decrease of £1,600,000 in imports. Western Australia had a recession in the early months of 1961, but there are signs that recovery has begun. That recovery may be expected to gather momentum in the remainder of 1961-62 because of the factors that I mentioned earlier in my remarks.
The Premier of Western Australia stated, in addressing the Commonwealth Grants Commission earlier in the week, that the present problem was not how to employ those who would be seeking work, but to ensure that new projects did not impose too heavy a pressure on the labour market. One of the fears I have in relation to the very rosy picture that has been painted of development in Western Australia is concerned with the availability of qualified tradesmen. As we know, some of the overseas sources of supply are drying up rapidly. West Germany, for instance, is importing tradesmen.
– Many of our tradesmen are leaving their trades because conditions are not sufficiently attractive.
– I was about to say that the apprenticeship position in this country needs to be considered seriously. If we are to cope adequately with our great development programme for the next 25 or 30 years, that aspect will have to be closely looked at. There is no great incentive to-day for a lad to become an apprentice. If he does so, he must accept a much lower wage than does his friend who goes straight from school to a labouring job where he may earn £12 or £14 a week as an unskilled labourer.
The lad who becomes an apprentice to a trade must accept a much lower wage over a period of perhaps five years. We should consider the advisability of making up the pay of apprentices in those circumstances. I foresee a very real problem for Western Australia in obtaining skilled people to do the jobs that will be available. I am delighted with the grant that is being made to Western Australia, lt is more generous than last year’s grant and will be made good use of by the State in its efforts to develop its economy and to reach the stage when it will be no longer an applicant State. 1 support the bill.
– I also rise to support the measure. Like Senator Branson, I hope that the day is not far distant when Western Australia will no longer be a claimant or an applicant State. I believe that there are in Western Australia special problems, which are not easy of solution, and which should be appreciated by our neighbours in the other States, in attempting to reconcile the proposed grant with those made previously by the Commonwealth Grants Commission. As has already been stated, the main difficulties in Western Australia arise from the size of the State and the sparsity of population. Because of those factors, the decentralization of social services, education and many other things is necessary. The railways have to service vast, unprofitable areas, and although in recent years some of the more unprofitable lines have been closed, the State is still paying interest on the debt that was incurred when the lines were constructed, which seems to be rather anomalous.
In order to assist in the development of the north-western portion of Western Australia, the State government operates a shipping service which has not so far been mentioned in this debate. That service operates at a loss in terms of pounds, shillings and pence, but nevertheless it is a great asset. Over the years, it has provided, not only a shipping service to the north, but many other services as well. It was the life-line of the north before the airlines also began to provide a transport service. The people of the north necessarily must get away from the rigours of the climate occasionally, and for that reason they are transported to the south at much cheaper rates than are customary for sea voyages. The freight rates, if viewed from the point of view of private enterprise, are uneconomical. We pay a lot of lip service to the people in the remote regions of Australia, but that lip service has been converted into something of a constructive nature in the way of reduced freight charges, particularly on perishable goods during the hot summer months, and reduced fares for travel to the south when people go on a much-needed vacation after a tour of duty in the north.
If the shipping service were a profitable one, no doubt it would be provided by private enterprise, but private enterprise realizes that there are factors associated with the area which makes a shipping service uneconomical. For instance, vessels of a special type have to be used because of the rise and fall of the tides in the various north-west ports. Then there is the fact that not only passengers but also live-stock must be carried on the ships. Those factors mean that special ships have to be built for the north-west trade, and it would bc uneconomical for a private shipping company to do that.
We have seen the total elimination of passenger ships from, the Australian coastal trade, except for the Western Australian coast, where a regular service is maintained by the ships of the State Shipping Service. As I have said, this shipping’ service provides much more than sea transport. We are very fortunate in the men who are employed in the service. The marine superintendent, the director, the captains of the ships and the men who man them have all been in the service of the State government for many years. I do not think anybody ever leaves the State Shipping Service voluntarily. The employees retire because of the effluxion of time. During the war, the shipping services did not stop, although some of our ships were sunk by enemy action on the north-west coast. The line continued to operate to schedule as best it could. The operation of the State shipping line results in a loss, but it is a loss which cannot be considered on a commercial basis, in view of the services which the line is rendering now to the people of the north and to the development of the north, and which it rendered Jong before the day of the aeroplane.
I should like to make some comments on education. In the past Western Australia had more one-teacher schools than any 0.her State. Those schools had only small numbers of pupils. They are gradually being eliminated, and the pupils now attend what could be termed area schools. Some advantages have been gained from this change, but I think there are some disadvantages as well. In some of the remote areas the one-teacher schools were social centres as well as educational cen.res, and parent interest in schools has lapsed to some extent because the newer schools serve larger districts. However, the maintenance of schools in remote areas was more expensive in Western Australia than elsewhere.
Let. me turn now to the other end of the scale- the university. We in Western Australia were very proud of the fact that we had the only free university, not only in Australia, but also, I believe, in the British Commonwealth. .Had the university in Western Australia not been a .free university, I could not have got a university degree. 1 could not have afforded to pay the fees. I certainly could not afford to take a degree now, under present conditions. Because the expenditure of the Western Australian Government for university purposes, was, comparatively speaking, greater than those of the governments of the eastern States, which drew revenue from their universities, a comparison to the disadvantage of Western Australia was made by the Commonwealth Grants Commission. Consequently, the students were gradually required to pay fees, and I believe that now the fees charged in Western Australia arc as high as those charged in the eastern States. We no longer have a free university.
Those people who are not accustomed to the idea of a fi te university may think that that is not a tragedy, but I believe it marks the end of something which we in Western Australia regarded as very precious. A free university enabled quite a number of people - promising students and others who were just sloggers, like myself - to receive a university education, wi:h its attendant advantages. It made the students, 1 think, more aware of their obligations to the community. In my time, we realized that we were getting something for nothing from the community and thai we should try to give something back in the way of service. I do not know whether that ideal has gone by the board now.
There is another aspect to be considered. In my days at the University of Western Australia, a survey was made of the incomes of the parents of students who had to go on to other universities lo take medical degrees - no medical course then being available in Western Australia. The survey showed, I think, that only one of every twenty students who went on to other universities came from a home where the income was about equal to the basic wage. When we eventually got our own law school and our own medical school in the West, we felt that we were drawing people from all sections of the community to fill the medical and legal professions. We felt that no longer were those professions in Western Australia open only to people whose fathers had been in them. It is true that many more Commonwealth scholarships and many more bursaries are available now, but 1 still believe that the charging of high fees by the University of Western Australia, in line with the findings of the Commonwealth Grants Commission, is a retrograde step. I very much deplore it. The charging of fees in the university is one of the ways in which we have made up the difference between university expenditure and revenue in Western Australia.
Another point made by the Grants Commission was that car registration fees were lower in Western Australia than elsewhere. In order to comply with the recommendations of the commission, those fees have been appreciably increased. They may still be a little lower than those charged in some of the eastern States, but I think it will be found that, on a per capita basis, the contribution by Western Australia to the petrol tax revenue and so on is higher than that of the eastern States. The reason is that in Western Australia you have to travel longer distances to get anywhere. Our roads are excellent, but we have to pay for them.
Our country roads are, I think, second to none in Australia. They cost the State a good deal of money, but they are necessary for the transport of primary products and so on. They are a part of our development. The State Government has learned over the years that it is much cheaper to provide a good road to begin with than to provide an inferior road that requires constant attention. I am pleased to be able to say that most of our roads in outback areas compare more than favorably with those elsewhere in Australia, but the cost of construction and of maintenance has helped to make Western Australia a claimant State. These expenses are continuing expenses. The State has to develop and, as it develops, the roads and the railways have to be extended still further.
We in Western Australia owe a great deal to our primary producers. We are trying to develop our secondary industries, but there is not a large local market for their products. We are dependent largely on our primary producers for our export income, so it is up to those of us who are city dwellers to help to provide the country people with adequate facilities for the education of their children, for the maintenance of their health and for the transport of their goods and families from remote areas to the metropolitan area and elsewhere.
Last week we discussed in this chamber the standardization of the railway between Kalgoorlie and Kwinana. The suggestion was made that this could result in more centralization, making Kwinana or Fremantle even bigger exporting ports than they are at present. I hope that that will not be so. I want to see more rural development and more development of outports such as Esperance, Albany, Bunbury and Geraldton. I know from what has gone on in this chamber during the past fortnight that there is a greater senatorial consciousness, if I may put it in that way, of the needs of the north-west of the State, a subject that I have been plugging at for many years. The north of Western Australia is an integral part, not only of Western Australia, but of the whole of Australia. It is very valuable from the viewpoint of defence. I have been hammering for years at the Minister for the Navy to establish a naval dockyard there, and in reply he has told me that that would cost many millions of pounds. Let me show the other side of the picture. The money that would be spent on a naval dockyard would not vanish into thin air. A large part of the wages of those employed on the construction work would be returned to the Government in direct and indirect taxes. The project would give employment to Australians and, more importantly, would help to build our defences in the West. After all, Western Australia is the part of this continent nearest to the more vulnerable parts of the world under presentday conditions.
The expansion of our industrial organizations, the building up of an iron and steel industry, the development of port facilities, the construction of roads and the modernizing of railways are important. I think that ultimately that expansion will result in Western Australia being no longer a claimant State. Western Australians will then be able to sit in this chamber with the same satisfaction as the South Australians enjoy now, when their State has emerged from a condition of subservience and no longer has to ask the Commonwealth each year for money. I do not think there is anything really subservient about that, because, after all, the money is raised in Australia from Australian citizens. It is the job of the more fortunate States to help those that are less fortunate.
I believe that the money that has been granted to Western Australia on the recommendations of the Grants Commission has not been wasted. It has been devoted to definite projects. As I have said, I regret that, as the result of a recommendation by the commission, the free, university in Western Australia has gone. That- was something in which I was vitally interested and of which I was very proud. Because we were receiving grants from the eastern States fees have been introduced on the same scale as those operating in the eastern States. We have had also to increase our motor car registration fees.
We were told in the report of the commission, I think on page 58, that last year a large amount of our indebtedness was due to the payment of unemployment relief. lt was a fact that we had a very big unemployed population in the west. I hope that difficulty will be overcome this year. It is no good blinding oneself to the fact that Western Australia has suffered badly over the last eighteen months from the point of view of employment. We have been told that 6,000 or 7,000 were unemployed, but 1 would say that that estimate is not correct. There were many more who had only part-time employment. I am hoping that our unemployment figures will improve. Somebody has said that there will be no unemployment by Christmas. I hope that is true because nobody wants to see unemployment, or to gain any party political advantage from the plight of those who are so unfortunately circumstanced.
As I have pointed out, the commission told us that our biggest expenditure was in the field of unemployment relief. In this respect, I should like to pay a tribute to the Child Welfare Department in Western Australia. Many people do not realize that that department is not only a child welfare department; it also helps all who are in necessitous circumstances. Many people do not realize the help they can obtain from this government instrumentality, probably because the name is a bit misleading. Although the department exists primarily to help mothers with children, it exists also to help people who are unemployed, who cannot subsist on their unemployment allowance, those who are ill, people requiring railway passes to travel to jobs in the country, and so on. The officers of the department are most courteous. I have never yet met in either the State Child Welfare Department or the Federal Government’s Department of Social Services any officer who, although he may not have been able to grant the application I was making, has treated me in any way discourteously. I should hate to think that Western Australia is being disadvantaged because of the excellent service it renders particularly in the Child Welfare Department. It is one of the departments that comes under the heading of increased expenditure, along with the cost of unemployment relief and so on.
I am afraid that one item of expenditure in Western Australia last year was pay-roll tax. It is rather silly to find a State govern ment having to pay pay-roll tax to the Federal Government and then having to receive the money back by way of a grant. It may be high finance, but I cannot work it out.
– That is a specific provision of the 1959 agreement to which all the States agreed.
– I still do not see why it should be so. Then we have expenditure on native affairs. Western Australia has a big native population and its Department of Native Welfare has done a very fine job. lt had to start from scratch. We have many nomadic native tribes in Western Australia. In the south we have big centres of aboriginal population. We are trying to give them decent housing conditions and good educational facilities. Western Australia faces a problem that is not known in Victoria or some other States which do not have the large aboriginal population that Western Australia has. Again, the aborigines are scattered throughout the State, extending from the far south, through the Kimberleys and the north and north-western districts. They vary in intelligence and in the degree to which they follow their tribal customs. They vary from those who can be easily assimilated into the community to those who are completely tribal in their ways. The State Department of Native Welfare has to cater for them as well as it possibly can.
Western Australia’s hospitals also present a big problem. I was very pleased to read the other day that the incidence of tuberculosis in Western Australia is lower than in any other State except Tasmania This makes one think, because Tasmania and Western Australia are the only two claimant States, and yet those two States have faced up to the problem of tuberculosis better than any of the other States. Whether it is’ that the other States are too much worried about how they are going to help us, I do not know. Tuberculosis experts from all over Australia held a conference last week in Perth and the statement was made that the two States which were dealing most satisfactorily with the problem of tuberculosis were Western Australia and Tasmania. As a matter of fact, we have a very fine chest hospital which, because of the very satisfactory position we are in, is not needed as a chest hospital and is being Used for general cases. A former chest hospital in the hills is now being used as a hospital for the aged and infirm. That again is quite a big step forward. Our health policy is expensive. We have to decentralize our hospitals. We have all kinds of hospitals - native hospitals, a leprosarium in the north, and small hospitals in remote country areas. AH these hospitals increase the cost of providing an efficient health service, and their existence is one of the reasons why Western Australia is still a claimant State.
Those are problems that will not be overcome in a day. Even when Western Australia’s big industrial programme gets under way we’ will still be faced with a number of these problems. I am only hoping that the development of the State will enable us at a not far distant date to help the other States. At present we are in the position of not being able to cope with responsibilities which we cannot shirk merely because we have not the wherewithal to meet them. The people of Western Australia are facing their difficulties with great courage. We think we are on the brink of a great era of industrial expansion. Western Australia has the potentialities, but it is not going to be easy to overcome the difficulties that confront it. The problems that arise from large undeveloped areas will not be overcome by the establishment of a steel industry here or a railway line there. We thank the Commonwealth Grants Commission for what it has done to help us in our problems. J regret the fact, as I have mentioned, that we have had to increase motor car registration fees and that we have had to abandon our ideal of a free university. However, I suppose we must balance those things against the greatest good for the greatest number. We have to accept the position. I support the bill.
.- I rise to say something about my own State of Tasmania, but before doing so I should like to say I find myself in complete agreement with most of what has been said by Senator Wright. He detailed the system of Commonwealth grants. He traversed the work of the Commonwealth Grants Com mission in apportioning a reasonable amount of the revenue granted by the. Commonwealth to each State in order, to attain uniformity in State expenditure. 1 find myself also in complete agreement with Senator Wright when he said that the 1959 Premiers’ Conference set the seal upon the uniform taxation system in the Commonwealth. I am one of those people who think it is most desirable that a State should be responsible for raising its own revenue, that it should be responsible to its own taxpayers, and that any other system breeds irresponsibility in expenditure.
When I was in the Tasmanian Parliament, I did all that I possibly could to oppose the continued implementation of uniform income tax. At that Premiers’ Conference’ the Commonwealth Government, without doubt, brought forward a proposition which at the time appeared to be so attractive that the States adopted it unanimously. I think even Victoria was in agreement with it. But it may well be that we who are living fo-day will see the time when our federation, as we have known it, will be altered substantially. I believe that the continuance of this taxation system must lead eventually - in fact, it has led already - to some kind of unification in the Commonwealth of Australia. Uniform income tax is here to stay. We have had it for twenty or more years now.’ I repeat that the action taken in 1959 -set the seal upon it. We have to accept it’ and do the best we can with it.
I agree with what has been, said about the Commonwealth Grants Commission. Tn my time in the Tasmanian Parliament I gathered .the impression . that the commission had performed a very useful function, that it had gained the respect of the States and that it was essential because, from political pressure it could bring about a state of affairs in which uniformity in State expenditure could be achieved. On this occasion the commission has presented a most comprehensive report. It has dealt at some length wilh a good many aspects of the economies of the States, lt has considered and reported upon the employment position in the States. It has taken into account public works expenditure, public undertakings, the consumer price index, productivity and other things.
Senator Wright referred to payments for specific purposes, and Senator Branson enumerated the special Commonwealth grants. He claimed that some of the things which were direct results of Commonwealth grants to the States would eventually lift Western Australia from the position of a claimant State to that of a standard State. These special grants, which are outside the scope of ordinary income tax reimbursements, have an effect on the general economy and the destiny of every State. I have no complaint whatever about the way Tasmania has been treated in the payment of special grants and ordinary taxation reimbursements. I think Senator Wright added the payments to Tasmania up to more than £20,000,000. It is the smallest State in the Commonwealth. In addition to those payments, including loan money, the Tasmanian Government has had about £40,000,000 a year at its disposal. That is a lot of money, lt is true that a good deal of it is spent on the hydroelectric scheme in the form of loans. Eventually, that expenditure should be revenue producing.
The Premier of Tasmania and some politicians in that State have looked askance at the special grants that have been made to some of the other States, and they have pointed out that nothing has been forthcoming for Tasmania. That is arguable. I call to mind the many millions of pounds that were poured into the aluminium works, which eventuated in a deal negotiated by the Leader of the Government in the Senate (Senator Spooner). The Premier of Tasmania said that that deal opened up a new era for Tasmania. He was very caustic, indeed, in his remarks about some honorable senators who opposed that deal.
– Some honorable senators over on your side?
– No, we supported it. In addition, a large amount of money has been spent in providing the State with the best shipping service that it has had in its history. The point that I was leading up to is this: I believe that in these special grants to the States - some of which we have been discussing, or will discuss before the Senate rises - there should be one criterion for the Commonwealth Government - that is, the development of latent potential, and the development of export potential, irrespective of State boundaries, wherever that potential is to be found. I believe that the Commonwealth Government should not take State boundaries into consideration.
– Except to keep the development balanced.
– Except, as Senator Wright points out, where it is necessary to keep the development balanced. I believe that in this country time is short; we simply must go ahead with developmental work. If we do not do it, some one else will do it for us in a way that we do not like. I claim that no Commonwealth Government should say, “ We cannot expend money on this work or that work because if we do we shall be expending more money in this State than in that State”. The Government must keep that balance which is essential to the development of the Commonwealth, but it must judge each proposition on its merits, and consider from which proposition the most development will accrue. I want to say something about Senator Wood, who is interjecting. In my time I have encountered parochialism in all its forms.
– Not in Tasmania?
– I was a member of a local government body in Tasmania for 26 years. There I found men in this frame of mind: If any money was expended in any part of the municipality except their own, it was expended at the expense of their part of the municipality. I found men with the same view in the Tasmanian Parliament. I have heard that view expressed in Tasmania by some people who are interested in these matters. Strange as it may seem, Queensland is pointed to as the overwhelming example of Commonwealth prodigality. To those people I have said, “The best thing that you can do is to go and tell that to Senator Wood “. In these matters - they are important - we cannot take State boundaries into account. I regret very much that the Tasmanian Government has not, so far as I am aware, seen its way clear to put to the Commonwealth properly costed, concrete propositions. It is the duty of the State to do that. If it puts up worthwhile projects, aimed at developing our latent potential, every honorable senator will give it the utmost support. It is useless to cry out aloud that Tasmania has received parsimonious treatment unless some worthwhile proposition is advanced, and before one’s own house is put in order in relation to land development so that there will not be such a fiasco as occurred at Montagu Swamp, where the State Government was a spending agency of the Commonwealth.
I support the bill. The Commonwealth Grants Commission is doing a worthwhile job. It may be open to criticism. In a federation it is difficult to arrive at a system under which balances can be held fairly and evenly between the States. This is the best agency yet conceived for adjudicating upon these matters. In those matters over which it has jurisdiction, Tasmania has been fairly and justly treated.
Question resolved in the affirmative.
Bill read a second time, and committed pro forma.
Sitting suspended from 5.49 to 8 p.m.
Bill - by leave - taken as a whole.
– Clause 5 of the bill sets out the amounts that are to be paid to Western Australia - about £6,000.000 - and to Tasmania - about £5.000,000. The grants are based on the recommendations of the Commonwealth Grants Commission. There has been criticism from a number of quarters of the Treasurer of Tasmania, Mr. Reece, who is also Premier, regarding his comments on one aspect of the commission’s methods - that dealing with the severity of taxation. The commission drew attention to this matter in paragraph 38 of its latest report. I invite the committee to differentiate between the rates of taxation that are levied in Tasmania and the per capita revenue from those taxes. On that point the commission said -
The Commission makes adjustment in respect of the level of rates of non-income taxation.
It does not look to the per capita tax that is derived. The report continues -
In fact, each claimant State has an overall higher rate of taxation than the standard States and so receives a “ favourable adjustment “.
Nevertheless the claimant States, because of their lower taxable capacity, do not raise as much revenue per . capita from taxes imposed at rates higher than those imposed in the standard States.
There is no argument but the rates of taxation are higher and the per capita yield is lower. The commission concludes by saying -
Moreover, if this discrepancy in taxable capacity continues to increase, it will be reflected in a larger revenue gap in the claimant States followed by a consequential rise in the amounts of the special grants.
If we turn to page 15 of the commission’s report we find that in the financial year 1959-60 there was favorable adjustment to Tasmania of £304,000 on account of this relative severity of taxation. A year ago in his Budget speech Mr. Reece referred to this very question and said -
If we thought that we could afford it, we could; for instance, abolish or reduce substantially some taxes. The Grants Commission would not question our right to make these decisions, even if by doing so our taxation rales fell far below those imposed in other States. The Commission would merely continue to make the same measurement as it now does of our efforts in the field of taxation, by comparison with the average effort made in the standard Stales. It follows therefore that any reduction in “ effort “ in a claimant Stale generally results in an unfavourable adjustment for comparative severity of taxation. While this would have no effect on the amount of the Special grant -
I take it that he is referring to the upset amount of the grant prior to adjustment - it would increase the size of the deficit which the State would have to fund.
I think Mr.Reece accurately stated the position there. If there has been any criticism of his recent speeches I think it has been based on a misunderstanding of what he said. I know that he has a complete understanding of the operation and methods of the Commonwealth Grants Commission.
In his Budget speech for this financial year Mr. Reece drew attention to the fact that there had been increases in certain duties, including stamp duty, conveyances on property, rates of duties on settlements and deeds of gift and an extension of stamp duty on hire-purchase agreements to cover credit sales agreements. The amount involved in this financial year even for a State as small as Tasmania, speaking from the financial viewpoint, is really insignificant. The amount that is the subject of disputation is, according to the Treasurer, only £45,000. That is a relatively petty cash item even for Tasmania when one has regard to the fact that Tasmania’s total revenue was just on £30,000,000 for the year. That £45,000 works out at less than 1 per cent. - something like 0.1 per cent. - of the total Budget, lt is an insignificant amount.
When one looks at the burdens cast upon the State by the Commonwealth Government, one sees that first taxation figure in its proper perspective. I am referring now to the fact that owing to the failure of the loan market the Commonwealth not only pays for the whole of its capital works out of taxation, using no loan proceeds, but when the loan market in addition fails to cover the State works programmes the Commonwealth again uses taxation and revenue to fill the gap. Whilst it uses its own revenue without interest charge of any kind for its capital works programme, this year running to the tune of £152,000,000, when it comes to financing State works programmes from the same source it lends that money to the States. The States must repay those amounts that have been collected in revenue by the Commonwealth and they are involved in the heavy burden of interest payments at bond rates. In the last eleven years up to 30th June this year, the Commonwealth public debt has fallen by £319,000,000, but Tasmania’s public debt has increased from £37,000,000 to £177,000,000. The States are given the dear moneys - the loan moneys - and they carry the obligation of repaying principal and interest. When they are given money derived from taxation they have to repay it with interest.
Tasmania’s public debt has increased by £140,000,000 in the last eleven years. Thirty-eight per cent, of that amount represents proceeds of taxes lent by the Commonwealth to the States and repaid with interest. The 38 per cent, to which I have referred is mentioned in the statement by the Commonwealth Treasurer (Mr. Harold Holt) which accompanies the Budget Papers. That statement shows that over a period of eleven years the total programme approved by the Australian Loan Council amounted to £2,279,000,000, of which £865,000,000 came from the Commonwealth. The Treasurer in that statement indicates -
The major part of the funds subscribed to the special loans by the Commonwealth has been derived from general revenue sources.
At least one-third of Tasmania’s indebtedness over the last eleven years has been due to the receipt of taxation proceeds from the Commonwealth. That would represent approximately £2,000,000 per annum in interest alone, apart from capital repayments. Why should there be a complaint about Tasmania increasing her own taxes this year by £45,000 when, at the instance of the Commonwealth Government, a burden of £2,000,000 per annum is cast upon the State in respect of interest alone?
As I see it, the situation is that the people have to pay their ordinary taxes to the Commonwealth, and then the Commonwealth lends them back from their taxes an amount which they are obliged to repay. Thus they pay the tax a second time, and in the process of the second extraction they pay interest on the money. It is idle to lament the fact that Tasmania is increasing its budget by £45,000, and at the same time to ignore the huge charge which is being levied on the State at the instance of the Commonwealth Government. What could Tasmania do in the way of development and in the provision of better services with an extra £2,000,000 a year?
I content myself with uttering those few broad comments. I shall conclude by revealing the picture in relation to the loan market for this year. This year the Commonwealth works programme will cost £152,000,000 and that of the States, including war service land settlement, £242,000,000-a total of £394,000,000. According to the Treasurer, the loan market is expected to yield towards the provision of. that £394,000,000 a sum of only £165,000,000, leaving a gap of £229,000,000. To that sum must be added £22,000,000 which it is expected will be required to meet redemptions as a result of the non-conversion of loans. Therefore, according to the Treasurer the total gap this year will be about £251,000,000. The sum of £165,000,000 which the Treasurer estimates will be raised on the loan market this year will fall short even of the amount required for the States.
Where revenue has had to fill the gap, It has been the practice of the Commonwealth to take the money necessary for its own purposes without charging interest, but when the money has been needed for State works programmes to lend it to the States and charge interest. The people, not only of Tasmania, but of all States, are placed in the same position, except that in some States the burden is very much heavier than in others. But I confine my remarks to the State that is the subject matter of this bill. To force a State to put up its charges to meet an interest payment is inflationary. That is a factor making for inflation all over Australia. Tasmania and Western Australia are expected to conform to a new standard. That standard is the average budget result of New South Wales and Victoria: Looking at those two States alone, the Tasmanian Treasurer may well say, “ In the light of developments in the budgets of those two States, in future I have to face the fact that the severity of my taxation must be adjusted so that it will retain its same relative position with that new standard “. That may be a factor that has induced the Treasurer to make these increases to which I have referred. He may also have made provision for the increases with a desire to avoid undue or further deficit finance. But it seems to me to be quite out of proportion to complain about an increase of that order at the instance of a State government and to ignore the plight of the State which has been caused by the Commonwealth imposing on it a burden of at least £2,000,000 per annum.
.- Senator McKenna has taken advantage of the debate at the committee stage to reply to arguments that I submitted this afternoon during the second-reading debate. I shall content myself with a very brief refutation of Senator McKenna’s rather confused submission. The first position I take up is that in relation to recent proposals for settlement duty and gift duty in Tasmania the Premier of that State has sought to justify his action by implying that the Commonwealth Grants Commission has penalized the State because its effort in raising revenue falls short of that of the standard States. Senator McKenna cannot refer to a single passage in the recent report of the Commonwealth Grants Commission to refute my argument. At page 69 of its report, the Commonwealth Grants Commission has placed on record the fact that, so far from making an unfavorable adjustment against Tasmania because it does not levy sufficient taxation, it gave Tasmania a favorable adjustment of £304,000 because the severity of its non-income tax legislation exceeded the general rate of that of the standard States. The Premier’s pretext for the introduction of a family properly imposition in the form of settlement duty and gift duty is based not upon fact but upon a distortion of the report of the Commonwealth Grants Commission.
The commission points out in its report that Tasmania is levying taxation amounting to £270,000 in excess of comparable rates and exemptions- imposed by the standard States. There is nothing in the report of the commission which’ gives the slightest justification for the family property taxation which the Tasmanian Premier seeks to impose.
I refer to the second argument which, with due respect to Senator McKenna, was introduced in a rather garbled form. The honorable senator has complained that the Commonwealth, when supplementing Tasmania’s loan works programme requirements out of its revenues when loan raisings are deficient, does not give the money to Tasmania as a grant but ‘ lends it at interest. ‘ The fact is that when the Commonwealth’s loan raisings proved to be insufficient for the adequate development of State capital works and services this Government - the Menzies Government - introduced a new spirit of understanding into State development and, instead of restricting the States to the actual achievements of the loan market, supplemented the States’ requirements from Commonwealth revenue. In the years from 1951 to 1961, the total amount approved by the Australian Loan Council for State works was £2,279,000,000. Of that amount, no less than £865,000,000 was provided by Consolidated Revenue. That is to say, 38 per cent, of the requirements of the States for capital development has been provided from Commonwealth revenue.
It is an easy and wasteful argument to contend that that money should have been granted to the States and simply expended as Commonwealth revenue. The Commonwealth takes the view that as the money is supplied as supplementary to the loan programme it is of the nature of a loan and therefore should bear interest. The equity of the matter lies between the Commonwealth Government and the individual taxpayer. lt is that issue which Senator McKenna has sought to confuse and has, in effect, confused. It is not proper that we should debate this issue in relation to the bill that we are discussing. The purpose of the bill is to grant to Tasmania £5.000,000 by way of a special grant, which is an all-time record. The degree to which this Government is assisting Tasmania should be properly appreciated. I, for one, submit that there is no foundation in what we have heard fall from the Leader of the Opposition and that a proper appreciation can be made only when we consider the general issue of the payment of capital works out of Consolidated Revenue.
– The points made by the Leader of the Opposition (Senator McKenna), particularly in relation to Tasmania, were interesting and I propose to refer to them. I repeat that this year Tasmania is receiving the highest grant that it has yet had. If my figures are correct, the grant will be £750,000 more than that of last year. Senator McKenna chided the Government for paying for public works from revenue. It seems strange that he should do that, because he was a leading member of a government which did exactly the same thing, even when it had surplus loan funds. It used those surplus loan funds to redeem treasury-bills, thus reducing interest rates. The honorable senator now charges the present Government with doing the same thing. It is not without interest to read the following statement which is reported at page 499 of the House of Representatives “ Hansard “ of 2nd June, 1949:-
Another complaint against the Government is that it has financed public works including those for the Post Office out of revenue instead of loans. Surely there is nothing wrong with that. Is it not right that in a time of prosperity we should try to finance public works from revenue?
The speaker was the late Mr. Chifley, who was at that time Prime Minister and Treasurer. Incidentally, we did not then hear comments to the effect that Mr. Chifley occupied the dual positions of Prime Minister and Treasurer for most of the time he was in the Parliament. As Prime Minister and Treasurer he applauded the practice for which we have been criticized.
What was the alternative to this method of financing public works? That is a question we must ask ourselves, because an immense amount of money has been spent in Tasmania on such works. If Senator McKenna wants to narrow the issue to that particular State I am quite prepared to argue it on that basis. The alternative was to curtail necessary public works and the expansion of the hydro-electric scheme, to the detriment of the industries which use the power produced by the scheme. As we know, money that has been supplied to Tasmania has been used for hydro-electric works. I suggest that if the people of Tasmania were to be given a choice they would say without hesitation, “ We would prefer to have works which we can see and which we know are operating for our benefit and for that of industry, works which create employment, rather than not to have the money at all”. I am sure they would not say, “ We do not want it if we have to pay interest on it “.
The Commonwealth has a responsibility to the taxpayers of Australia, from whom it takes this money in the form of taxes. If the Commonwealth did not lend the money to the States it could use it to pay off) existing loans and so save the interest on those loans. Consequently, it could save the taxpayers of Australia the amount that it now pays in interest on loans. Instead, it lends the money to the State governments, and properly so, in my opinion. The money is lent to the State governments regardless of its source. It is a shallow argument to say that because the money comes from taxation it should not be used in that way. We have to look to the end use. The making of loans to the States places the State loan programmes on a proper financial basis. When a State government proposes to undertake a work it must examine the economics of the project, knowing that there will be a certain amount of interest and repayment of capital to include in the cost. That is a sound and practical way of financing public works.
I point out that the Commonwealth Grants Commission takes into account the amount of interest that is payable and recommends a grant accordingly. I think that that clearly demonstrates just how shallow is the argument advanced by the Leader of the Opposition, plausible though it may sound. When the spotlight of a proper economic examination is turned on it, it is shown to be superficial. I do not want to spend much time on this matter. As I have said, I know that the people of Tasmania would prefer to have the hydroelectric works and the other public works that they see in their State than not to have them. I know they would rather have the industries that are operating in the State, and which are developing because of the use of this money, than to say: “ No. If the Commonwealth wants to charge us interest on the money we will not have it.”
Senator McKenna talked about the failure of the loan market. It is easy to talk in those terms, and it is easy also to talk in terms of the experience of the Labour government of which he was a member. During the life of that government there was no avenue of investment other than the loan market. The fact remains that the Grants Commission, by recommending this munificent grant to Tasmania - the highest by far that the State has received - has put an additional £750,000 into the State’s coffers. The people of Tasmania will know where that money comes from. They will give due credit to the Government that has provided it. As I have said before, the people of Tasmania prefer to see their hydro-electric undertakings, their industries and all that goes with them rather than to say, “ We should never have taken the money that enabled those industries to be established, because the Commonwealth charges interest on it “.
– Let me deal first with the reference that was made to the report of the Commonwealth Grants Commission, and with the statement that it recommended an adjustment of £304,000 in favour of Tasmania on the ground of severity of taxation.
– That is a fact, is it not?
– That is something that is not denied. It is something that I affirmed previously. It is something that is not contested by the Premier of Tasmania, although we have been told that an inference to the contrary effect could be drawn from a statement that he made. We have been told that the inference to be drawn from his statement is that increased taxation was required to preserve the grant, but we have not been told what the statement was.
– I read it this afternoon.
– I regret that I did not hear it. The honorable senator knows that, having already spoken in the secondreading debate, I could not intervene this afternoon. I know that the Premier of Tasmania understands the methods that the Commonwealth Grants Commission uses and the principles on which it operates. I am prepared to say that the inference that has been suggested could not properly be drawn from his statement. 1 believe that any statement that he made would not be open to such an interpretation.
Senator Henty advanced the argument that the lending of tax money to a State for its capital works, to bridge a gap in the loan market, was evidence of a new spirit. I could not imagine anything farther removed from the spirit of federation than that. The Commonwealth and States are supposedly in partnership, but the Commonwealth - the body which is dominant financially and which holds the bulk of the country’s revenue resources - says that it will finance the whole of its capital wo:ks from revenue - with money on which it pays no interest - and that it will hand to the States the dear money - the loan money which carries an obligation to repay the principal and to pay interest charges - to finance their capital works.
– Is that a new principle, or did the Labour government adopt it?
– Throughout the war and for most of the period of office of the Labour government no public works were undertaken. In the immediate postwar years, only public works of insignificant proportions were undertaken.
– You handed loan money to the States and made them pay interest on it. You used any surplus money to pay off your own loans.
– As the honorable senator suggests, the Labour government paid off the Treasury bills that had accumulated during the war and it reduced Australia’s overseas debt. All that is perfectly true. However, let me explain the attitude of the Labour Party rather than the honorable senator. A white paper was published in 1944 in which Labour’s views on this subject were committed to writing. I do not have the document at the moment, but I can tell the honorable senator that the Chifley Labour Government announced that it was prepared to use some revenue - not all of it, as this Government has done - to finance capital works. I now- have the document. In 1945-46, capital works were valued at £6,000,000, compared with £152,000,000 for this financial year. In 1946- 47, the value was £15,000,000; in 1947- 48, £24,000,000; and in 1948-49- the last year of office of the Labour government -£40,000,000. In that year the public works programmes of the States were beginning to gather momentum. It is misleading to compare the financing from revenue of a portion of the works that I have mentioned with what has been done for twelve years under this Government. In those twelve years this Government has taken from revenue nearly £1,400,000,000 to finance the whole of its capital works. That is not what Labour postulated.
– Mr. Chifley would have done the same.
– He certainly would not have done the same. Senator Henty said that the only alternative to the present system was to give no money to the States.
– I did not say that.
– That is what 1 understood the honorable senator to say. Let me suggest a fair and proper alternative. Assume that there is available a certain volume of loan money, carrying an obligation to repay the principal and to pay interest, and a certain volume of revenue which can be called upon. Would it not be in accordance with the spirit of the Constitution for the Commonwealth to say to the States that it was prepared to share the dear money - the interest-bearing money - in accordance with the size of the respective works programmes and that it was prepared to share the tax revenue - the interest-free money - in the same proportions?
– It would not be fair from Tasmania’s point of view.
– I say that would have been completely fair. At present, however, the States pay interest on every penny made available by the Commonwealth, whether it is tax revenue or loan money. That is one of the reasons why the States are forced to increase their charges. That is one of the important factors contributing to inflation. This procedure is adopted by a government that promised to put value back into the £1 and to reduce costs. I say that the Government should act in accordance with the spirit of the Constitution, which implies that there is a partnership of the Commonwealth and the States. That would have been the wise procedure and a procedure that would have had the effect of keeping costs down. In my book, it is certainly not just or fair that the Commonwealth should pay for the whole of its capital works with tax revenue - interest-free money - and that it should lend to the States tax moneys collected from the people, asking the people to pay that tax money a second time and, in addition, to pay interest on it.
This argument arose from a criticism of the Premier of Tasmania in relation to the levying of £45,000 of taxes and the effect of that increased taxation upon this grant. I was not prepared to stand by and listen to honorable senators opposite attributing to the Premier of Tasmania something which, I »m certain, would not be in his mind. I am sure that the statement that has been referred to is a misrepresentation of what hs said.
It is impossible to compare the situation to-day wi.h the order of things in Mr. Chifley’s time. One must have regard to the fact that even in the years to which I have referred some only of the moneys came from revenue. The gaps were insignificant in those days. There was no gap at all in 1947-48. In the year 1948-49 - these are the last two years - there was, despite what the honorable senator has said, no gap in the loan market at all.
– There was a surplus.
– Gaps were not actually budgeted for and they were not realized. The honorable senator is speaking of an entirely different period, an entirely different order of amounts, and also of an entirely different budgetary result.
.- I wish to underline what Senator Henty has said as to the effect of capital moneys promoting production in Tasmania. The Commonwealth Grants Commission has certified that the net value of factory production per capita within the Stales is as follows: -
That will show the degree to which benefit accrues to Tasmania from the moneys that are now being debated.
The only other thing I wish to say to Senator McKenna is that when he seeks to give the impression that the general moneys available to Tasmania from this Government were made available on a niggardly basis, let me answer him by quoting from the record. In 1959, the specialgrant amounted to £3,400,000; in 1960 to £4,300,000; and in 1961 to £5,000,000. That shows the progression of the special grants. With regard to general financial assistance there is also a progression. In 1959, the amount granted was £10,900,000; in 1960, £11,900,000; and in 1961, £12,800,000. The equity of those figures should be accepted by every responsible person representing the people of Tasmania. I submit that the argument that we have listened to is a confused argument of a political nature which seeks to justify the Premier of Tasmania only on the assertion that he knows the principles on which the Commonwealth Grants Commission works.
– I merely wish to say that nothing I said during the course of this debate indicated that I considered that the grants to Tasmania were niggardly. I was not reviewing that particular aspect, and I said nothing that would indicate that. My remarks were directed entirely to the practice of burdening the State with interest in the way I have indicated.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
– by leave - I lay on the table the following paper: -
Correspondence in relation to negotiations between the Commonwealth and East-West Airlines.
On 3rd September, 1.957, the Government announced in Parliament that it had decided to “ extend assistance by way of subsidy to the operators of essential rural services and also to help selected operators obtain suitable replacement aircraftfor the DC3 “. Subsequently, the Commonwealth negotiated a contract with East-West Airlines Limited and also with Ansett Transport Industries, the parent company of Airlines of New South Wales, and Queensland Airlines establishing the conditions under which subsidy was to be paid for “ essential ru ral services “. The most important clause of this contract was that-
The company shall not during the continuance of this agreement, without the prior written approval of the Director-General either directly of indirectly engage in -
interstate public transport air service operations; or
any intra-state regular public transport air services additional to those being operated at the date of this agreement.
Provision was also made in the contract for it to be terminated by three months notice.
Subsidies under this new policy were first paid to East-West Airlines Limited in 1958- 59 when it received £16,955. In 1959- 60 it received £25,000, and in 1960- 61 it received £25,700. Government approval was also given in 1959 for EastWest Airlines Limited to obtain on generous financial terms the use of Fokker Friendship aircraft from Trans-Australia Airlines.
The operations of East-West Airlines Limited in the nine years from its inception in 1949 until it began to receive subsidy in 1958-59 resulted in a total profit over the whole period of only £7,500. In the first year of subsidy operations, i.e. 1958-59, the company made a profit of £21.721 and in the second year, 1959-60, £8,909.
In 1960-61 the company, despite a subsidy payment of £25,700 and the help it had received with aircraft procurement, ran into serious financial difficulties and it is not yet clear how the company has resolved these because it has not declared a trading result for 1960-61.
In April of 1960 Ansett Transport Industries Limited made a cash offer of 56s. for each £1 East-West Airlines Limited share. This offer was rejected.
Following the rejection of this offer the company obtained the approval of an extraordinary meeting of shareholders on 25th June,1960, to amend its articles of association so that -
The financial position of the company in 1960 was well known to my officers who conduct a detailed examination of its accounts each year in order to assess the subsidy requirement.I had received the report of their examination for the year 1959-60 towards the end of that year, but before I had determined what the subsidy should be I received advice that the company intended to seek approval of its shareholders for the bonus share issue. This advice did not come to me from the company itself, which at this stage had given no official advice of it to either my department or myself.
Having regard to my detailed knowledge of the company’s financial position I could see absolutely no justification for this bonus share issue, for it was apparent that extreme difficulty was already being experienced in servicing the existing capital of the company. In these circumstances, I considered it essential that I make it clear that the gratuitous issue of over £50,000 would not automatically rank for subsidy calculation. This was done and advice was also given to the company that I had fixed its subsidy payment for 1959-60 at £25,000. Subsequently the company declared a profit of £8,909 after making provision for taxation.
Although this profit satisfactorily covered the share capital of some £100,000 which ranked for dividend in 1959-60, it was obvious that a much greater profit would be needed to service the new capital structure of £165,000 in 1960-61. The company became greatly concerned quite early in the new financial year about its prospects and made requests to discuss its operations with me. This I agreed to and Mr. Drummond introduced Mr. Pringle and his general manager to me in Canberra in July, 1960. I was accompanied by my Director-General and Assistant Director-General (Policy).
I have detailed the financial history of the company to this point because it is essential to an understanding of my role which was primarily to determine the subsidy requirements of the airline.I expected Pringle and his general manager to discuss with me the financial problems of their airline, which they did in some detail. I told them that the Government had done everything it could to help them within the terms of existing policy but I would give no undertaking that subsidy would be increased to meet their new capital structure resulting from the bonus issue.
Pringle expressed concern that Ansett might renew his take-over bid. I said that as the company had rejected it only a few months earlier and had taken action to give the board itself power to reject any renewed offer, surely it was a dead issue. In any event, if the offer were renewed it was entirely for the board and not for me to consider what should be done.
I felt that the company had to face up to its immediate problem which was to promote greater profitability in its existing operations. I said that as both Airlines of New South Wales Proprietary Limited and East-West Airlines Limited were obviously now going to continue indefinitely as separate operating companies in New South Wales, they should do their utmost by collaborating on common operational, technical and traffic problems to reduce costs. I did not, at any time, as Mr. Drummond now confirms, tell Pringle to sell out or amalgamate. Pringle said he was proposing talks with Ansett-A.N.A. and asked me to arrange the meeting, which I declined to do.
After our Canberra meeting, Pringle wrote to me in the terms of the letter which I read to the Senate yesterday, and appeared to be impressed with the thought that better operating relations be established with Airlines of New South Wales Proprietary Limited. In response to this letter I rang Pringle and repeated what I had told him previously; that I could not agree to his suggestion that I put him in touch with Ansett. I believed the matters they proposed to discuss were not my concern and if Pringle wanted to go ahead he should get in touch with Ansett himself and make any necessary arrangements. This he did, but I had no further official advice from East-West Airlines Limited on the result of the talks, nor did I seek it. When this matter became a public cause I checked with the Ansett organization and was informed that East-West Airlines Limited had asked Mr. Walker, a top Ansett-A.N.A executive, to join them at Brampton Island.
The next development occurred in March of 1960 when the New South Wales Government announced its intention to make a review of airline operations in that State. According to press reports, this review followed representations by EastWest Airlines Limited to the Government of New South Wales.
I should make these points -
The New South Wales Government appointed Mr. J. Borthwick, a former Commercial Director of T.A.A., to undertake the review. On 9th March, 1961, Mr. Shand of East-West Airlines Limited saw the Director-General of Civil Aviation in Melbourne. Mr. Anderson had askedto see Mr. Shand so that he could make clear the obligation” of his company to get approval under the contract for any changes in route pattern which might be madeby the New South Wales Government. Mr.Shand wrote to Mr. Anderson on his return from Armidale - see Appendix “ B “ to thedocu- ments tabled - giving his version of the interview. Mr. Anderson replied on 17th March - see Appendix “ C “ - saying that he wished to clarify several points on which he felt Mr. Shand had a misunderstanding of the real position.
I commend that exchange of correspondence to the Senate. The clearthinking and straight-forward Mr. Shand did not quite understand what was said at the conference.
– Read the correspondence.
– It is suggested that I read the correspondence. I will read it. Mr. Shand wrote to the DirectorGeneral of Civil Aviation, Mr. Anderson, on 10th March, 1961, in the following terms: -
Thank you very much for your kindness in spending so much of your time with me yesterday.
I confirm that it will not be the policy of East-West Airlines to take over or interfere with any of the Ansett network prior to the end of June. After that it is our intention to work as a unit in aviation to blend co-operatively with the wishes of the Federal and State Governments.
I have advised John Riley that you assured me that if this undertaking were made the subsidy of £25,000 would be available in the course of the next month.
If an equitable basis is found between Airlines of N.S.W. and East-West Airlines our Board will go ahead with additional capital and staff and would be grateful for any help you or your department would give us in ensuring that a wise decision is made.
I was pleased to have your comment that you did not expect any difficulty in the provision of Commonwealth financial backing for any additional equipment necessary for East-West Airlines as the result of decisions arising from the airline survey in New South Wales.
Re Handley Page: As I indicated we have been offered the agency and would like to show you some of the correspondence from that company.
With best wishes and again many thanks.
On 17th March, 1961, the DirectorGeneral replied to Mr. Shand in the following terms: -
I am replying immediately to your personal note of 10th March, 1961, because I feel that there are one or two points which do not reflect fully the purport of our recent discussion.
First, my main purpose in seeing you was to invite your attention to Clause 13 of your subsidy contract with the Commonwealth which states:
The Company shall not, during the continuance of this agreement without the prior written approval of the Director-General either directly or indirectly engage in -
interstate public transport air service operations; or
any intrastate regular public transport air service operations additional to those being operated at the date of this agreement.”.
You will, I am sure, appreciate that compliance with this clause affects not only your current years subsidy but also your eligibility for payment in future years. As far as the current year is concerned, the Minister has fixed this at the level of £25,700 and has agreed, in view of the current cash difficulties of East-West Airlines of which you spoke, that we may pay you immediately the pro rata amount earned to 31st March, i.e., £19,275.
Honorable senators will no doubt notice how ruggedly I treated this crowd. The letter continues -
The remainder will, assuming all terms of your contract are complied with, be paid in three equal monthly amounts covering the period 1st April to 30th June, 1961.
Concerning the proposed re-distribution of air routes in New South Wales, I think I made it clear - but in any event I do so now - that to continue to be eligible for subsidy you must first obtain the approval of the Commonwealth Authority to any significant variation in your route structure.
In this connection, I am sure that you will appreciate that it would be an intolerable position for the Commonwealth, which provides the substantial part of facilities and subsidises both internal New South Wales airlines, to have the route pattern determined by a State Authority which neither bears nor shares any financial responsibility in the matter.
I think, Don, that you are also under some misunderstanding on the aircraft equipment issue. I did indicate that the Government in 1957 made its policy clear in the following terms: - “ In the case of feeder services, the Government has decided to extend assistance by way of subsidy to the operators of essential rural services and also to help selected operators obtain suitable replacement aircraft for the D.C.3. The grant of this assistance will be conditional upon the operator agreeing to provide services to specified areas at frequencies approved by the Minister, having regard to public needs and convenience in the rural areas to be served.”.
In pursuance of this policy, the Commonwealth has facilitated the making available to you of a Fokker Friendship from T.A.A. I made it clear that anyfurther assistance would be a matter for Government decision. For my part, I would feel that any further assistance for internal services in New South Wales is highly unlikely since the Government, in addition to your F.27 from T.A.A., has already made provision under the Airlines Equipment Act for all the replacement aircraft foreseeably necessary to meet the needs of New South Wales.
That is to be read against Mr. Shand’s letter, in which he said -
I was pleased to have your comment that you did not expect any difficulty in the provision of Commonwealth financial backing for additional equipment.
The Director-General’s letter continues -
I do hope your Handley Page agency works out to your satisfaction.It is a fine, rugged aeroplane which to date has been outsold by Fokker principally because of the belated installation of Rolls Royce engines in the Herald. The very best of luck to you with this.
I also hope the above makes your position very clear as that was my objective in asking to see you on 9th March, 1961.
Since it was apparent that the results of the New South Wales review of air services could have a marked effect on the subsidy requirement for the next financial year, the department on 23rd March gave East-West Airlines the required three months’ notice of termination of its subsidy contract to take effect from 30th June, 1961. The department said this was done with a view to re-negotiating the contract in the light of any changed circumstances. Action was also taken to terminate the subsidy contract of Ansett Transport Industries. This contract covers not only the rural services of Airlines of New South Wales and Queensland Airlines but also the developmental services of Ansett-A.N.A.
The next important development came on 13th June, 1961, when the Premier of New South Wales wrote to the Prime Minister, in the terms of Appendix F, asking in effect for assurances that any new network given to East-West Airlines would be subsidized and that assistance would be given to acquire the necessary additional aircraft, lt was clear, at this stage, that the New South Wales Government already had some idea of the broad changes it intended to make in the New South Wales network but was seeking prior financial commitments by the Commonwealth to an undisclosed new pattern before it put it into operation. The Prime Minister replied to Mr. Heffron on 12th August, 1961, saying, in effect, that subsidies would continue to be paid in accordance with existing principles, that the Commonwealth would have to have regard to the total subsidy payment, that it would be indefensible for the “ bonus “ shares to b<?. serviced by subsidy and that he saw no justification for giving assistance for the purchase of additional aircraft for New South Wales rural services which already had an adequate fleet.
In June, 1961, when I visited Orange to open the new aerodrome, Mr. Shand made persistent attempts to see me to talk about the problems of Ea«t-West Airlines. I failed to see what useful purpose this could serve as no finality had been reached in the New South Wales survey and I had no current proposal before mc in connexion wilh the affairs of his company. I finally did see Shand and we discussed a variety of matters. He again raised a possibility of an Ansett take-over and I told him that as Ansett had repeatedly said he had no intention of renewing his offer, why was he so concerned about it. In any event, this was entirely a matter for his board which they now had full power to deal with.
After I got back to my office, Shand wrote to me - see Appendix “ H “. I suggest this is an unusual letter for a man to have written who now accuses me of “ pressurising “ him at Orange to sell out to Ansett. It makes no mention of our even having discussed such a possibility.
– Will you read the letter for the benefit of the people who are listening?
– Who is listening.
– Plenty of people are listening. This is a stunt.
– This is the taxpayers’ money.
– I know it is hard for you to take it.
– This was a letter written to me by a gentleman, after I had seen him at Orange, who subsequently accused me of trying to pressurize him into doing something.
– At Orange.
– es, at Orange.
The letter reads -
I have given a lot of thought to the talk we had in Orange.
I called at your office when in Canberra last week and found you had departed for South Africa. I hope your trip was as interesting as the one I had there; recently.
I have been to see Donald Anderson and had a long talk with him.
Could you kindly wire me at your convenience, on your return as I would like to have a talk with you.
I now realize some of the tremendous difficulties that you have to cope with, and hasten to assure you that small as our organization is we want to help the progressive development of this country and not hinder it.
Your department, especially yourself and Donald have done much to help us develop, I do thank you for all your kindness in the past and hope you can spare some of your time to see me in the near future.
Some time in July, 1961, Shand again pressed himself on me at Canberra. As I remember it, his principal mission to
Canberra at that time was to try to sell Handley Page aircraft, for which his company now had the agency, to the Royal Australian Air Force or to try to get maintenance work from them for his shops at Tamworth. I told him this was a matter for the Minister for Air. He again raised the matter of the Ansett offer. I told him there was no offer in existence. He said he referred to the offer of May, 1960, and I reminded him that as recently as 7th July, in a letter to members of the Federal Parliament, which was subsequently published in the newspapers, Ansett had said that he was not interested in making an offer for East-West Airlines.
Following this Canberra interview, Shand wrote to my Director-General on 16th August - see Appendix “J” - alleging that I had urged him at Orange and Canberra to sell out to Ansett. As Mr. Anderson had . been kept fully informed by me of my conversations with Shand, he wrote to him setting out what he knew to be the true position. The Director-General sent me a copy of his letter to Shand and I followed it with a further letter - Appendix “ K “ - which I have read to the Senate and in which I informed Shand that his comments were quite incomprehensible. .
Nearly two months later, on October 3rd, Mr. Shand wrote to Mr. Anderson - see Appendix “ L” - setting out in detail his views on a number of matters. On the same day, that is, 3rd October - on which Mr. Shand wrote to the Director-General he sent copies of all correspondence he had with myself and Mr. Anderson to the Prime Minister - see Appendix “ M “. The Prime Minister replied to Mr. Shand on 23rd October, saying that although the Government could not contemplate adding aircraft to a fleet that was already adequate to meet all requirements for rural services, subsidy payments would continue to be paid in accordance with established principles. He went on to say it would be prudent, however, for the company not to expect an increased subsidy payment.
In the light of the Prime Minister’s letter to Mr. Shand, no departmental reply has gone to Shand’s letter to the department of 3rd October. However, the following two points might now be briefly made: -
Finally, Shand’s outburst a week or so ago about my allegedly pressurizing his company in July, 1960, and again at Orange in July, 1961, to sell out to Ansett is remarkable when one pauses toconsider that the Ansett take-over bid lapsed in May, 1960, that is, about eighteen months ago. Why has Shand waited solong to accuse me of urging him to accept a non-existent take-over bid? I suggest the basic reason is to facilitate, through the medium of the resulting political controversy, the deliberately planned simultaneous move of the New South Wales Government to hand over a substantially profitable part of the air route network of Airlines of New South Wales to East-West Airlines. Mr. President, this is an infamous political stunt.
– I move -
That the paper be printed.
To afford honorable senators an opportunity to study the voluminous correspondence which has been tabled, I ask for leave to continue my remarks at a later stage.
Leave granted; debate adjourned.
Reports on Items.
– I lay on the table of the Senate reports by the Tariff Board on the following subjects: -
Bean seed (Phaseolus vulgaris).
Bisphenol A: Epoxy resins.
Chain and chains.
Fish in airtight containers.
Penicillins and Streptomycin.
Work trucks, mechanically propelled.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Spooner) read a first time.
– I move -
That the bill be now read a second time.
The purpose of this bill is to obtain the approval of Parliament to an agreement between the Commonwealth and the State of New South Wales providing for financial assistance to the State towards the cost of installing improved coal loading facilities at the ports of Newcastle, Port Kembla and Balmain. This project is one of the major State works which the Government has had under consideration as being projects which should make a significant contribution to the promotion of increased export earnings.
The export of coal overseas from New South Wales has expanded notably in the last three years and is already making an important contribution to Australia’s balance of payments. During 1960-61, over 1,800,000 tons valued at about £7,400,000 were exported through the three ports concerned in the present project. The exports were shipped mainly to Japan, tomeet the requirements of that country’s rapidly growing industries. There are good prospects of a further substantial increase in the trade. Forecasts based on studies of
Japan’s future coal requirements and discussions with Japanese industrialists indicate that coal exports from the New South Wales ports could increase to £12,000,000 per annum within a few years and to over £16,000,000 per annum in this decade. These exports will be possible without prejudicing in any way the needs of the Australian steel industry. In addition to the valuable export earnings which can be expected, the New South Wales coal industry and the coal mining districts should benefit directly in many ways from the wider market for New South Wales coal.
The expansion in coal exports which is in sight cannot materialize, however, unless the facilities for loading coal at the ports are improved and the improvements are completed in the shortest practicable time. The trade is very competitive and the overseas buyers might turn to other sources for their coal requirements if they thought that the New South Wales ports would not be able, in a few years’ time, to provide adequate and economical facilities for coal shipments. Of primary importance is the need to deepen the harbours and berths to receive the larger vessels now coming into use in the coal export trade. Larger vessels offer significant freight advantages and coal exports are expected to be carried increasingly in ships of 25,000 tons capacity and upwards, as compared with the present 10,000 to 12,000 tons. Equally important is the need for modern equipment at the wharfs, capable of loading coal at reasonably fast rates, so that the full benefit of larger ships can be gained through quick turn-round and reduced harbour and wharfage dues. Faster loading equipment at the wharfs needs, in turn, adequate storage and access facilities to maintain the supply of coal to the loaders.
The New South Wales Government has a full realization of the problems associated with the expansion of coal exports and the trend towards larger vessels. For some time it has been studying the prospective volume of the trade and planning the facilities required to handle it. The maintenance and development of ports is a State responsibility and the Commonwealth Government has no intention of intruding into State rights and responsibilities over port facilities. In this particular case, however, the expansion of exports in prospect was sufficiently important for the Government to believe it had an obligation to inform itself about the progress being made by New South Wales, and to ascertain whether there was any way in which the Commonwealth could help in the carrying out of the project. lt became apparent during the discussions which took place with the New South Wales Government that the Commonwealth could make it possible to reduce materially the time taken to complete the work. Without outside financial assistance, New South Wales could not undertake to construct the works at all three ports simultaneously, lt would be necessary to spread out the works over a period of about six years and to complete some sections of the total programme before starting on others. Even this programme could have been delayed for financial reasons. Financial assistance from the Commonwealth, on the other hand, would make it possible to compress the time-table by removing financial obstacles to the completion of the port facilities in the shortest time practicable on engineering and other physical grounds. This is estimated at three to four years, and the shorter construction period could make a significant difference to Australia’s ability to secure favorable export contracts.
The outcome of the discussions between the Commonwealth and the State was a formal submission by the New South Wales Premier of estimated costs and proposals concerning the way in which Commonwealth financial assistance might be put to best use. On the basis of his submission, and the detailed knowledge of the programme which had been gained during the discussions, a Commonwealth offer was formulated and was accepted by the State.
The main features of the assistance agreed upon were described in a statement which the Prime Minister issued on 29th August. The New South Wales Government undertook to ensure that a programme of work, involving the spending of some £10,660,000 on three harbours, would be carried out as expeditiously as practicable and that the funds necessary for that purpose would be provided as required. The total programme includes the deepening of harbours and the provision of deep water berths as well as the installation of coalloading plant and related works. The Commonwealth, for its part, undertook to provide financial assistance to New South Wales in respect of the coal-loading plant, including the associated wharfage, storage, road and rail facilities up to half the estimated cost of the coal-loading works, that is, up to an amount of £2,650,000. The Commonwealth assistance is to be provided on a £1 for £1 matching expenditure basis with the State, up to individual maxima of £1,500,000 at Newcastle, £1,070,000 at Port Kembla and £80,000 at Balmain.
Of the total Commonwealth assistance, up to £1,000,000 is to be made available from the Coal Industry Fund of the Joint Coal Board. As the Prime Minister (Mr. Menzies) pointed out in his statement of 29th August, any assistance which the Commonwealth might provide to revenueproducing works of this kind would normally take the form entirely of repayable advances. In this case, however, we had regard to the uncertainties in the costs of works of this magnitude and in the estimates of the eventual volume of coal exports through these ports. .The State ^naturally accepts whatever risks are involved in these respects, but the Commonwealth has been anxious to give the State all reasonable support and has decided to make part of the assistance available by way of grant. This will also serve to reduce the charges which would otherwise be levied for the use of the new facilities.
The remaining part of the assistance, amounting to up to £1,650,000, is proposed to be made available by the Commonwealth in the form of advances repayable by the State. Negotiations have been conducted between the Commonwealth and State Governments on the terms and conditions of the repayable advances, and a formal agreement has been drawn up and signed on behalf of each government. It is the bill to give effect to that agreement which is now before the Senate for approval.
The bill itself is brief and provides mainly for approval of the agreement, and for appropriations from the Consolidated Revenue Fund for advances to be made by the Commonwealth in accordance with the agreement. The agreement is set out as the schedule to the bill and its contents may be summarized as follows. The preamble is, in effect, a brief description of the reasons for, and the nature of, the whole Commonwealth financial assistance, including the grant element as well as the repayable advances. The arrangements for the grant assistance, referred to in paragraph (f) of the preamble, are straightforward and do not require further approval. They are simply that when the State applies for funds, it will apply for grants as well as advances in the same manner and supported by the same kind of evidence of expenditure. The Commonwealth will arrange for payments to be made to the State in the proportions of grants to advances set out in paragraph (e) of the preamble. The terms and conditions of the repayable advances are given in detail in the body of the agreement.
Clauses 4 and 5 of the agreement provide for the making of advances by the Commonwealth to the State up to the amounts specified, either as reimbursements of expenditure already made by the State or, if the Treasurer approves, in anticipation of expenditure to be made, on or in connexion with the coalloading works. The advances are to bear interest at 53/8 per cent, pes annum and are to be repayable in ten years by twenty semi-annual payments. The State undertakes in clause 9 to carry out the coalloading works with a view to their completion as a part of the harbour works at the earliest practicable date, subject to the Commonwealth providing financial assistance as agreed. The remaining provisions relate to variation of the schedule of works, the provision of estimates, the supply of information, audit and the giving of notices. A description of the works is set out in the schedule to the agreement under two headings the harbour works and the coal loading works.
I conclude by emphasizing that the programme which the New South Wales Government has embarked upon is an important contribution to the expansion of the export trade. Some of the work has already begun and other sections are in an advanced stage of preparation. At Balmain, dredging has been completed and tenders have been received for the new coalloading facilities. At Newcastle, tenders have been called on a world-wide basis for the removal of rock from the bar at the harbour entrance, and it is proposed to dredge the leads, channels and berths to provide a depth of at least 36 feet of water to the coalloading plant. It is planned that the coalloading plant will be able to load at a rate which is yet to be determined, but which will be at least 1,500 tons an hour, as provided for in the schedule to the agreement. At Port Kembla, planning is well in hand for the construction of a coal berth on a new site in the inner harbour and tenders have been called for a loader with a capacity of 2,000 tons an hour. The plans include the provision of adequate storage and access to the wharf and the deepening of the berth to at least 36 feet of water.
The Government is satisfied that the installation of these works will permit the coal export trade to be maintained and expanded, and that financial assistance from the Commonwealth in the manner proposed will contribute importantly to their early completion. I have great pleasure in commending the bill to the Senate.
Debate (on motion by Senator Arnold) adjourned.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Henty) read a first time.
– I move -
That the bill be now read a secondtime.
The bill provides for the validation until 30th June, 1962, of the collection of customs duties under the following Customs Tariff Proposals: -
Customs Tariff Proposals Nos. 30 to
Customs Tariff (New Zealand Preference) Proposals Nos. 5 and 6,
Customs Tariff (Canada Preference) Proposals No. 5.
The proposals which the Senate is asked to validate comprise the proposals which were moved in the Parliament on 12th, 19th and 25th of this month.
Honorable senators will appreciate that time will not permit these proposals to be debated before the close of the session, but they will be re-introduced early next year and an opportunity to debate them will be made available to honorable senators in the next Parliament. The bill therefore validates the collection of duties until 30th June, 1962.
Debate (on motion by Senator Willesee) adjourned.
Debate resumed from 20th October (vide page 1384), on motion by Senator Paltridge -
That the bill be now read a ‘second time.
.- This bill proposes several amendments of the Audit Act. One of the amendments would authorize the Treasurer to request a department to keep accounts of such of its operations as he thought necessary and to prepare financial statements in such form as he wished. The second amendment proposes that the books, accounts - and statements kept and prepared as a result of the Treasurer’s request shall be subject to inspection by the AuditorGeneral. I do not think that those amendments require any explanation.
A further amendment proposes the insertion of a new section relating to refunds not covered at present by other acts. A fourth amendment relates to the work of officers of the Commonwealth outside the Commonwealth itself. I think it is well known that the work of the AuditorGeneral is now of a global nature. Although the Auditor-General has full authority in relation to the handling of moneys and the accounting for moneys outside the Commonwealth, he has not, through some oversight, authority in respect of stores handled overseas. The fourth amendment is designed to bring such stores under his control.
Another bill will authorize the AuditorGeneral to audit the public money transactions of the parliamentary departments. Honorable senators may recall that some years ago the question was raised whether the Auditor-General had authority to audit the transactions of those departments. 1 do not know how the matter was dealt with then, but I think it was allowed to lapse. The authority of the AuditorGeneral in this sphere will now be put beyond any doubt, and I think every honorable senator will approve of what is proposed.
It may have been noted that in the financial statement that the Treasurer presented to the Parliament for the financial year 1957-58 the columns showing shillings and pence were omitted, and the sums involved were given in pounds only. After that was done the question arose as to whether it was strictly legal. There was some doubt about it, so the act is being amended to legalize what was done. There are a few other amendments of a technical nature. They are really machinery clauses, and I do not propose to go through them in detail. The Opposition does not oppose the passing of this measure.
– We have before us a bill to amend the Audit Act. The act constitutes the offices of Auditor-General, .who, with his staff, is the special and peculiar agency of Parliament itself to scrutinize and justify the integrity and economy of the public accounts of expenditure of this Parliament. I agree with Senator Benn that the actual amendments introduced by this bill are of little consequence. I rose to underscore what I think should be emphasized in this Parliament, namely the independent nature of the office of Auditor-General.
First, I notice with regret that the salary of the Auditor-General is now £5,900, which is £1,000 less than the salary of the heads of several departments. I have raised my voice in this place before in support of the claim that the Auditor-General is next beneath the judges in representing an authority of independence in this country. It is wrong that in salary status he should stand less in importance than heads of departments who enjoy a salary status of £6,900. The- next point- is that I have found it unsatisfying over recent years that the Auditor-General’s reports have consisted, in the main, of repetitions of figures found in public accounts, whereas I claim that the Auditor-General’s report should be a current commentary upon items of expenditure which are wanting in integrity, economy and legality. I have commented in recent days on this matter and have nothing to withdraw from what I said as to some shortcomings in respect of that standing. I rise to-night to speak on this amending bill in the hope that Ministers, and Parliament collectively, will subscribe to the plea that the standard of criticism I have mentioned should be forthcoming in the reports of Auditors-General. The reports should not consist merely of abbreviated, and sometimes equivocal, references to expenditure of doubtful implication, but should directly, forcibly and plainly report to both Houses of Parliament matters which are wanting in economy and integrity of expenditure and in strict compliance with the lawful appropriations expressed in our parliamentary bills. I think that compliance with a standard such as that would provide one of the greatest safeguards that this Parliament could have in respect of its expenditure. I do not want to go over the criticism I made last week, but I withdraw not a word of it. I shall direct attention to that matter in the same way on a future occasion. This is not the occasion to do so, especially as I am speaking when this Senate is on the air.
I mention these matters to-night because I think the office of Auditor-General is an indispensable safeguard to the security of the Parliament. The Auditor-General’s department should be completely independent of Government policy and fearless in criticism and commentary on departmental expenditure. He should also be painstaking in the care with which he writes his annual report so that all who will read can understand, not merely proved cases of non-compliance with parliamentary appropriations but also cases in which there is no suggestion of defects in that regard.
When we come to the committee stage of this bill I shall seek clarification of a part of the bill which refers to the Parliamentary Refreshment Rooms. 1 rose during the second-reading stage, to invoke what 1 think is an earnest requirement, namely that the proper status of the AuditorGeneral should be recognized. He should take his place immediately beneath the judiciary in regard to independence of office. Then, the Auditor-General should not, year by year, supply the Parliament with any equivocal comment on expenditure that is doubtful but should make a plain, forthright statement of opinion on any expenditure that is wanting in integrity, proper regard for economy, or in compliance with the lawful appropriations of this Parliament.
There is one footnote I should like to add to my speech. It is a matter on which my mind seeks clarification. I remind the Senate that in 1954 we passed a bill amending the Audit Act, the main purport of which was to extend the term of office of the then occupant of the office of AuditorGeneral, Mr. Brophy, for whom we all had the highest regard. Let there be no misunderstanding on that point. Let there also be no misunderstanding when I say that the extension of an independent office of this character is a precedent that should not be entered upon lightly, because the man who accepts this office should do so realizing his independence and also his onerous responsibility to accept criticism. On that occasion we voted for an extension of the office to Mr. Brophy because the matter was put to us in the following terms -
The present Auditor-General has a life-long association with the accounting work of the Commonwealth, and during his period of office has completed a comprehensive review of the Audit Act. His suggestions for alterations in Treasury accounting procedures are now under examination. During next year, it is hoped to bring down legislation embodying substantial amendments to the Audit Act.
I said at the outset of my speech that I agreed with the Opposition’s assessment that these amendments are trivial and inconsequential. The thought occurs to me that the time is overdue when the Parliament should be informed of the contents of Mr. Brophy’s comprehensive review of the Audit Act derived from his lifelong experience. Why have they not been submitted to this Parliament?
Question resolved in the affirmative.
Bill read a second time.
.- I refer to clause 4 of the bill, which introduces a new section 2a. Sub-section (3.) of that proposed new section reads -
The provisions of this Act do not apply to or in relation to affairs and transactions (including the receipt or expenditure of money) in relation to the Parliamentary Refreshment Rooms except affairs or transactions involving the expenditure of moneys for the purpose of which the Consolidated Revenue Fund has been appropriated.
I should like the Minister to explain to me the full implications and meaning of that proposed new sub-section. Inasmuch as the Parliamentary Refreshment Rooms, in the main, are supported by public expenditures, it seems to me that the scope of the report of the AuditorGeneral upon them must necessarily include the entirety of the undertaking, and exclude any subscriptions that are made by members of the Parliament as a matter of personal expenditure only as one item. Can the Minister tell me what is the intendment of the restrictions in that proposed new sub-section which limit the AuditorGeneral’s responsibility and authority in relation to that expenditure?
– The purpose of this proposed new sub-section is to define the Parliamentary Refreshment Rooms as a department in the same way as other government departments. This amendment brings them directly under the direction and surveillance of the Auditor General. In 1952, there was a difference of opinion between the Presiding Officers and the AuditorGeneral in regard to the audit of the accounts of the Parliamentary Refreshment Rooms. This clause in the bill clears the matter up. The Parliamentary Refreshment Rooms become a department subject to the AuditorGeneral’s surveillance.
– You are satisfied that it gives the AuditorGeneral proper scope, are you?
– It brings the moneys appropriated for the Parliamentary Refreshment Rooms under review by the Auditor General.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Debate resumed from 20th October (vide page 1378), on motion by Senator Paltridge -
That the bill be now read a second time.
– The bill now before the Senate contains amendments to the Navigation Act 1912-1958. One might say that they are further amendments to the Navigation Act because in 1958 a very comprehensive set of amendments to the Navigation Act 1912-1956 was passed. Now, only a short time later, the Government finds itself again amending the principal act, and also amending the amendments made in 1958. The Government indicated in 1958 that this act would be kept constantly under surveillance, and it hoped to avoid the major operation that was needed in that year.
I ask the Minister in charge of this bill to make a note for the benefit of the AttorneyGeneral (Sir Garfield Barwick) of the question of the consolidation of acts. Many of us have talked about that matter over the last few years. This act highlights the problem with which members of the Parliament are confronted when such acts are being amended. The principal act runs to 291 pages. The amendments to it in 1958 ran to 85 pages. The amendments before the Senate now run to 36 clauses. It is no wonder that confusion arises when laymen look at these acts. Even for people like ourselves, who get used to amending acts in the committee stage it is difficult to hop from one document to another in order to take an intelligent interest in the amendments that are being considered.
I think it would assist the Minister if the main debate on this bill took place in the committee stage. I am sure that he would appreciate that rather than have a discussion on the various clauses during the secondreading debate. However, I wish to refer to section 424 of the parent act, which was repealed in 1958. The new section inserted in that year sets up the Marine Council and reads in part -
The Marine Council shall consist of -
four members representative of shipowners;
one member representative of deck officers;
one member representative of engine-room officers; and
two members representative of seamen other than officers.
If the Minister is trying to follow me, he should look at the 1958 amending act and not the parent act, because the 1958 amending act completely repealed some sections of the parent act. Sub-section (5.) of section 424 gave the Marine Council certain powers in. the following terms -
The Marine Council shall inquire into and report to the Minister upon any matter arising out of or relating to this Act which the Minister refers to the Council for advice.
The Marine Council is a body on which the Minister may lean at any time for advice. Sub-section (6.) of section 424 of the principal act reads -
Regulations shall not be made for the purposes of sub-section (2.) of section fourteen, sub-section (2.) of section fortythree or section one hundred and seventeen of this Act unless the Minister has first obtained from the Marine Council a report on the proposed regulations.
The only point I underline is that it is mandatory on the Minister to refer to the Marine Council matters coming under those sub-sections. Sub-section (7.) of section 424 reads -
The Minister may, for the purpose of obtaining advice on any particular matter arising out of or in relation to this Act, appoint persons to constitute a committee of advice.
Here is a body set up under the act with which the Minister must confer on certain matters. The act gives the Minister the opportunity to seek advice from the council on other matters. I wonder whether the Minister consulted with the council before bringing down these amendments to the act. I think that if he had consulted the council the bill would not have contained all the provisions that it now contains.I would like the Minister to tell me whether he sought advice from the council. At the committee stage I will move amendments to the bill, particularly to clause 7, which deals with engine-room crews. The Opposition feels that clause 7 seeks to impose bad working conditions.
Throughout the Navigation Act ‘we see the tendency to delete sections and substitute regulation for them. That is always doubtful procedure: I can never see any justification for taking provisions out of an act and writing them into regulations. After all, the Parliament at some time gave these matters serious consideration and decided to write them into the act. They should not, therefore, be dealt with by regulation. I would like the Minister to clear up the matters I have raised in relation to section 424 of the act; and I hope that he has noted my remarks concerning consolidation of the act.
.- I support the bill. It will enable the Director of Navigation to allow a ship to go to sea with less than fourfifths of. it’s complement if he is satisfied as to the safety of the crew and the engineroom staff where the crew does not exceed five. The bill also repeals the rather antiquated provisions as to attachment of seamen’s wages.
I wish to refer to a matter that was brought to the attention of the Senate last week by Senator Kendall. He alerted us to the apprehension he felt from his seagoing experience about the proposal to substitute the words, “ Minister or prescribed officer “, for the words, “ Director of Navigation or Deputy Director of Navigation “. Senator Kendall alerted us to the possibility that that may undermine the nautical skill that should be possessed by people in direction of navigation in, the various ports of Australia. I have interested myself in this matter and I find that the substitution of the words,’ “Minister or prescribed officer “, occurs in every instance in which the words, “ Director of Navigation “, now occurs. That applies in every section of the act whether the duties of the Director are important or unimportant. I can see in this proposal no undermining of the position of Director of Navigation or Deputy Director of Navigation.
The principal act does not prescribe the qualifications that must be held by ‘ an officer who is appointed to be Director of Navigation or Deputy Director of Navigation. That is to say, at present the choice of the officer to occupy that office is at the discretion of the Minister or the Public Service Board. The amended legislation prescribes the duties formerly belonging to the officer described as Director of Navigation to the Minister or other prescribed officer. It is hardly to be expected that the Minister will personally undertake the discharge of any duties. He will resort, therefore, to the alternative of prescribing by regulation the officer who shall be the substitute of the Director of Navigation. He will be required by regulation to designate that officer. That will give to each House of the Parliament the right to review his decision. So far from providing a loop hole for undermining the independent and technical qualifications that should be possessed by the Director of Navigation, the proposal will give to each House of the Parliament an adequate opportunity to watch the. regulations by which the officier who is substituted for the Director of Navigation is prescribed. For that reason I have no complaint to offer to the proposed amendment to the act.
Question resolved in the affirmative.
Bill read a second time.
Clauses 1 and 2 agreed to.
Clause 3 (Act does not apply to naval ships, &c).
– I wonder whether the Minister for Civil Aviation (Senator Paltridge) knows why section 3 of the principal act is to be strengthened in the manner proposed. The clause is designed to enlarge the scope of that section. I am not greatly worried about the amendment, but I thought there might be some significance in it.
– The explanation is comparatively simple. The Air Force and the Army now have vessels, whereas when the original act was passed they did not have vessels.
May I take advantage of this opportunity to reply to a query that was’ raised at the secondreading stage? Senator Willesee asked whether the Marine Council was consulted in the preparation of the amendments contained in the bill. I am informed that generally the council is consulted, but that it was not consulted on this occasion because the provisions under review were safety provisions rather than industrial provisions. The Marine Council usually is consulted in relation to industrial provisions. The honorable senator will be pleased to know that action is now in train to consolidate the act.
Clause agreed to.
Clauses 4 to 6 agreed to.
Section fortythree of the Principal Act is amended -
– I should like to make one or two remarks before I propose the amendment that is now being circulated. Is the Minister of the opinion that clause 7 in itself is an industrial provision? He has just explained that the Marine Council was not called in for advice, and that its advice is generally sought only in relation to industrial clauses. This clause could have a very marked effect industrially in that it will affect conditions of work. Although the act contains no reference to salary scales, I understand that it is accepted in the industry that if a ship sails without a member of a crew the pay of that officer or deck hand is divided amongst the remaining members. Therefore, this clause could have an effect on wages. It very definitely would have an effect on working conditions.
Section 43 of the principal act allows a deputy director of navigation to permit a ship to go to sea with a reduced deck complement or reduced engine-room staff. Proposed new sub-section (12.) provides -
In this section - the minimum deck complement ‘, in relation to a ship, means the persons required by virtue of sub-section (1.) of this section to be carried on the ship as able seamen, ordinary seamen, boys and apprentices less -
if the number of those persons is less than ten one of those persons; or
in any other case not more than onefifth of those persons;
I suggest that the size of the crew should be arrived at by taking into consideration only the fully qualified persons and not the boys or apprentices. I mention that in passing.
The amendment that I propose to move relates to the engine-room complement. Some one may ask why we are worrying about the engine-room complement and not about the deck complement. We do not want to be unduly obstructive in relation to this matter. Obviously, the deck complement would not have to remain at full strength at all hours of the day and night. When all is said and done, the running of the ship would not be affected if some one was not on deck for 30 or 40 minutes, or perhaps longer. The situation in relation to crew members who are engaged in general duties is different from that in relation to those who have to attend machinery. The problem as we see it is that if the engine-room complement consists of fewer than ten persons, permission may be granted for the ship to go to sea with one person less. If there were ten persons working in the engine-room it would probably be logical to say that in certain conditions the number could be reduced by one, two, or even three. But if you had only three persons on the engine-room staff, it would be reasonable to assume that each of those persons would work an eighthour shift. In other words, one man would work for eight hours and would then rest for sixteen hours. That would be quite a reasonable industrial arrangement.
But if the complement were reduced to two, obviously each man would have to work for six hours and be off for six hours and so on in order to arrange a 24hour tour of duty. Obviously, such an arrangement would be contrary to normal industrial conditions. Most industrial awards provide that people shall have longer than six hours . rest from duty. In fact, my recollection is that a couple of awards provide for a rest of ten hours. With rough seas, it would be imposing an undue strain on a person to oblige him to work for three, four, five, six days, or even longer, attending to machinery and to be on duty for six hours and then off for only six hours.
– I should not think they would attempt it for a long voyage.
– Our information is that it is quite common for three greasers to go on a voyage lasting for four or five days. It must be remembered that the unexpected, due to accident, sickness or some other cause, is always likely to happen. If I understand Senator Kendall’s interjection correctly, it is no; expected that circumstances such as thoseI have mentioned will arise. Nevertheless, I can see no reason for failing to include this added safeguard in the act. I do not think that anybody would lose by including such an industrial condition. It is all very well for the Minister or the present director to say there is no possibility of such circumstances arising. Ministers and directors come and go. I therefore move -
In the definition of “ the minimum engineroom complement” in proposed sub-section (12.), after “ ten “ insert,” but not less than four “.
If the stage were reached where there was only one man on shift, it would certainly not be desirable to have him working for six hours on and six hours off. That would be an intolerable position to apply under any award.
– The Government cannot accept the amendment which Senator Willesee has moved on behalf of the Opposition. I say at once that in the formulation of the proposed amendment of the act the Government had regard to the kind of argument that might be advanced industrially. The Government regards the proposed amendment as a safety measure, as it has on other occasions when amendments have been made of this section and similar sections of the act. It has always to be remembered that a ship may not sail short of crew without the authority of the superintendent. I suggest that it is unreasonable to assume that a superintendent would permit a ship to sail with a crew shortage in circumstances in which safety might be involved. There is always the safeguard that the superintendent has to give authority for the ship to sail. 1 think it is reasonable to say that the record of superintendents shows that they are careful to observe their responsibilities in all matters, particularly in respect of safety.
Senator Willesee has referred to the inclusion of boys in assessing the strength of crews at sailing time. In point of fact, while a percentage of boys is allowed for the assessment of crews, where shortages occur boys are not counted in. To take an example, let us assume that there is a complement of twelve, including two boys. If there is a shortage of two members of the crew, the crew cannot consist of eight men and two boys. It has to be ten men.
– The Minister has explained the practical position. However, I often notice that there is a tendency to include in legislation a little additional power which in many cases I think is unnecessary. If it is the practice to exclude boys and apprentices in the mathematical calculation, why make such provision in the act? I think it is a very wise thing not to include boys and apprentices, but I cannot see why the provision in this regard is necessary. Similarly, if it is true that history shows that superintendents in no circumstances allow safety to be prejudiced - they would certainly be irresponsible people if they did, because a tremendous tragedy could result thereby - why include this provision in the act? What damage would be done if apprentices were to be excluded? I repeat that I do not think any arbitration authority would include in an industrial award a condition of the kind that 1 am speaking about. Senator Kendall has Some knowledge of these matters, although his practical experience of them was gained some time ago. From what he has said and from the Minister’s explanation, the proposition I have put seems to be strengthened rather than weakened.
– 1 can only add to the remarks that I have already made, that this is a provision which is included to meet unusual or extraordinary circumstances. My advisers have suggested to me circumstances in which a vessel proceeding from, say, Brisbane to Sydney, called at Newcastle to put ashore a sick seaman. This provision may be availed of to prevent the sailing of the vessel for three or four hours, but always, I emphasize, subject to the approval of the superintendent.
Clause agreed to.
Clauses 8 and 9 agreed to.
Clause 10 (Deserting seaman may be ordered on board his ship).
– It appears to me that the amendment proposed by the Government makes it mandatory on the court to return a deserting seaman to his ship and takes away from the court the right to decline to do so if it thinks fit. I am wondering why an amendment of this nature is necessary. It seems to me that it would be very wise for the court to have a discretion in the matter. I suggest that the usual procedure would be for the court to have power to decline to order the seaman’s return. Because of the situations that may arise owing to strikes on ships, due to industrial conditions, social conditions, clashes of temperament and that kind of thing, I think it might be wise to allow the court to use its discretion in such matters. I should like the Minister to comment on that aspect.
Proposed section 105 states -
Where a seaman or apprentice has been found guilty by a court of the offence of desertion, or the offence of absence from his ship without leave or reasonable cause, being absence not amounting to desertion or nol treated as such by the master, the court may . . .
I think the court will retain a discretion.
Clause agreed to.
Clauses 11 to 13 agreed to.
Clause 14 (Official log-book).
– This is one of the provisions I had in mind when I directed some criticism at the practice of legislating by regulation rather than by act of Parliament. In this case, I cannot see that any harm would be done by retaining in the act the provisions relating to entries in the official log-book of a :hip. They have been in the act for a long time. There would be nothing to prevent further pisions, if they became necessary, being added by regulation. I believe that anything that is written into an act gives a guide to those who draft regulations made under the act. At present, the act makes it mandatory for the captain of a ship to report in the log-book such things as illness, injury or death, questions relating to wages, persons going into the King’s naval service, and so on. It seems to me that those are rather serious matters. If the provision relating to such entries were retained in the act, that would set a pattern for the regulations. I cannot see how the administering department could lose anything if that were done. This is one of, I think, four or five amendments which propose that something now prescribed in the act shall in future be the subject of regulations. That is a bad principle, I believe.
As I said in my speech in the secondreading debate, if the Parliament considers certain things and writes them into an act, that gives a guide to the people who subsequently make regulations under the act. In this instance, if the provision proposed to be omitted were retained, there would be a clear indication to a master of a ship of the kind of entries that he should make in his log-book.
– The reason for this proposed amendment, briefly stated, is to bring the section into accord with modern times and modern practices. It is not contemplated that, because these provisions will be removed from the act, log-books will in future be less complete. I have been told that there are reasons why it is now more advantageous to have a non-static provision dealing with this matter than a static provision. Equipment is changing, and we now have such things as radar, for example. It is easier to make regulations to meet changed circumstances than to amend the act.
Clause agreed to.
Clauses 15 to 19 agreed to.
Clause 20 (Submersion of load lines).
– Prior to 1958, the penalty prescribed for an offence against this section of the act was £100, in 1958 it was £500, and now it is proposed that the penalty shall be £1,000. That seems rather like an auction mart. I am wondering whether the Minister can explain quickly why the penalties have risen even more rapidly than, I think, the cost of living.
– The penalties have risen in a manner which might suggest an auction mart, but the reason for the increases is that in the last few years bigger ships, particularly tankers and bulk carriers, have come into service.
Clause agreed to.
Clause 21 agreed to.
Clause 22 (Compensation for loss occasioned by improper use of signals).
– I make the comment again that we are taking something out of the act and saying that it may be the subject pf regulations made under the act. In this instance, we are dealing with the use or the sending of signals. Nobody has any’ sympathy for a person such as the one who’,’ a few years ago on the Western Australia coast, deliberately sent false signals, thus involving a risk to people’s lives. I follow the argument that, with changing signals! methods, it may be wise to meet the charges by regulations, but I believe this is such a serious matter that great care should be exercised in handling it.
There is one other thing that interests me. Probably I am prompted more by curiosity than a desire to make a genuine inquiry. I notice that in proposed new section 230 the following words appear -
Be liable to pay compensation for any . . risk incurred or loss sustained in consequence of the signal having been so used or sent.
Is there any provision anywhere that sets a money value on risk incurred? It seems to me that it would be very difficult to assess an act of bravery in terms of money.
– It has been found in practice that different types of signals require such frequent alterations of description that the only really practical way in which to deal with this matter is to take it out of the act and to make it the subject of regulations.
I cannot answer the honorable senator’s question dealing with compensation for risk.
Clause agreed to.
Clauses 23 to 32 - by leave - taken together, and agreed to.
Clause 33 -
After section four hundred and twenty of the Principal Act the following section is inserted: -
” (2.) In this section, ‘ troopship ‘ means a ship used for the transport of members of the naval, military or air forces of the Commonwealth or of any other country, including a foreign country.”.
.- I move-
In sub-section (2.) of proposed section 421, after ““used “ insert “ exclusively “.
I move this amendment because it seems to me that in this instance as in other instances the bill as drafted will give powers to the Minister which are unnecessary and which should not be written indiscriminately into an act. The proposed new section reads -
Let me say immediately that if we were at war the emergency powers that any government would possess would enable this to be done. It has been the experience of this country and other countries during two world wars that provisions of this sort go by the board. They are merged in the powers conferred under national security regulations or relevant legislation. We can imagine a provision of this sort applying at the present time to the transport of troops to, say, Malaya where we have defence forces, or to any other country in south-east Asia to which the Government may from time to time take action similar to that which it has taken in Malaya.
The Opposition suggests that this power should be exercisable only in respect of a ship that is used exclusively for the transport of troops. There might be only half a dozen, or perhaps 50, 60 or 100 troops . on a ship carrying twice or three times that number of ordinary passengers, and in such an instance the Minister would have power to declare the ship to be a troopship. In that case the safeguarding of industrial conditions would go by the board. Therefore the Opposition says this power should not be vested in the Minister. We feel that the difficulty would be overcome if the word “ exclusively “ were inserted as we suggest.
The Minister would still have power to declare any ship to be a troopship whether it be the largest liner afloat, a tanker or any other type of ship. The amendment would not take that right from the Minister if a ship were used exclusively as a troopship. If he takes over a ship and puts troops and equipment on it to go to Malaya, he has the right to declare that ship to be a troopship, but if he merely places a few troops on an ordinary oceangoing liner, intending to discharge them at Singapore or some other place like that, the Opposition does not think that in such circumstances the Minister should have the power to declare the ship to be a troopship. The insertion of the word “ exclusively “ would achieve our purpose.
– The Government cannot accept the amendment because it would be too restrictive to meet certain conditions which in these days arise more frequently than they did in the past. I appreciate the point made by
Senator Willesee that in a case where there were more civilian passengers than troops there might be some justification for his amendment. However, the Government has in mind the type of operation in which a troopship carries not 300 or 400 civilians, as instanced by the honorable senator, but a handful of civilians who may be going with troops in a time of peace for some particular purpose. On the other hand, as is more frequently the case, a ship carrying troops may also carry a quantity of cargo to the same destination, or to a destination in close proximity to that of the troops. The Opposition’s amendment is too restrictive. It would prevent a ship being put to optimum use. Therefore the Government cannot accept the amendment.
Clause agreed to.
Clauses 34 to 36 and the Schedule - by leave - taken together, and agreed to.
Title agreed to.
Bill reported without amendment; report adopted.
Motion (by Senator Paltridge) proposed -
That the bill be now read a third time.
– I urge the Minister togive serious consideration to the consolidation of the principal act. It has, become almost impossible for ordinary sailors at sea to have recourse to the act. In the original act there were 425 clauses. In 1958, 208 clauses were added, and now another 35 clauses are to be added. These are not the types of amendments that can be cut out and pasted in the principal act. The whole position is becoming very difficult. On behalf of my colleagues at sea I ask the Minister to recommend that the act be consolidated.
– in reply - Senator Willesee raised the same point earlier. I am pleased to be able to tell Senator Kendall, as I told Senator Willesee, that action is now in train to consolidate the act.
Question resolved in the affirmative.
Bill read a third time.
Debate resumed (vide page 1461).
– The Opposition suggests that this bill and its cognate measure, the Western Australia (Beef Cattle Roads) Bill 1961, be debated simultaneously to the secondreading stage and be voted upon separately.
– I agree to that request.
– There being no objection, that course will be followed.
– The purpose of these two bills is to provide financial assistance for Queensland and Western Australia for the construction of what are termed in the Minister’s secondreading speeches “ beef roads “. I think everybody is fully aware that a road is constructed from one point in the country to another. If a road is improved and is better to travel over than other roads in the district, the people will make that road a general road and it will certainly cease to be used exclusively for the transport of beef cattle. However, “ beef roads “ is the title given, to them. I suppose that term has just been used to indicate why these grants are being made.
I say at the outset that the Opposition does not oppose these bills; it supports them. I wish to make some comments on the bills. We have to face up to the fact that the method” of transporting stock has changed with the expanded use of motor vehicles. I can remember well the time when cattle were bred in the Northern Territory and transported to Western Queensland and the Queensland coast on foot. There was no other way in which they could be transported. If one travels over the road between Tennant Creek and Alexandria Downs and across to Mount Isa, one finds that watering facilities have been provided for stock at suitable distances. I would imagine that they are provided about every ten miles. As I have been going along I have observed the special watering facilities that have been provided over the years at a fairly great cost. When road trains are used to transport stock, the transport is much quicker because the road train can go on to a station property and be loaded from the stockyards in a matter of an hour or two.
Then the drivers can set sail, and they need not stop until they reach their destination. That is the new method of transporting stock. We have to face the fact that it is here, and it will expand. It seems only reasonable that if it is here in fact, and is being used widely, we should provide the road trains with roads as good as we can afford.
The Queensland railway system is rather suitable for decentralization. A railway line runs west from Rockhampton to a terminal at Longreach and another terminal of a branch line at Yaraka. Of course, roads can be constructed quite easily from those points towards the northern Channel country. More roads can be constructed in the north. The bill specifically mentions that provision is to be made for the construction of a road between Julia Creek and Normanton. Recently I passed over that country. I know that it is all cattleraising country. Whether the road will serve any immediate purpose and whether it can be turned to great profit at an early date I am not prepared to say. Normanton is situated in that part of Queensland near the Gulf of Carpentaria. For many years the cattle from that area have travelled in to Cairns on the hoof. Once the road is constructed from Julia Creek to Normanton, it will tap that cattle country and the cattle will go into the Townsville meat works.
I do not want to extend this debate unduly. The transport of cattle is only one factor in relation to the beef cattle industry. It has never been a serious problem. The main problem, of course, is to provide the stock with sufficient nutritional feed. In the second-reading speech on the Queensland Grant (Beef Cattle Roads) Bill the Minister said -
More importantly, its general availability has the side effect of promoting quite significant changes in animal husbandry, allowing cattle to be “ turned off “ at much younger ages and thus increasing the productivity and overall efficiency of individual properties …
I doubt seriously whether the construction of roads will allow younger cattle to be turned off more quickly. A bullock is usually sold when it reaches the age of four years.
– He can be trucked when he cannot be driven.
– Wait a while. They can be driven as yearlings, as poddies, as twelve-year olds, or two, three or four-year olds. I know what I am talking about. Usually they are left on the property until they are approximately four years old and then they are fattened and transported to the market. I do not know where the gain would be in transporting them from the station property before they attained the age of four years, unless they were going to be sold as stores.
These roads will improve the cattle industry if we have good seasons. As I said before, the transport of the stock is not a major problem. The general policy is not to transport stock from station properties when the properties are confronted with a drought. The usual policy is to allow the stock to die on the properties and then stock up when the drought is over. On these roads the road trains will be able to travel at greater speeds and they will be able to carry a full quota of stock. That will be of benefit to the cattle-raisers. I feel that that will be so, although I have not had an oportunity to go into the economics of the new system. I have a rough idea of droving costs, but I am not aware of the costs under this new system. I have seen the road trains, the big diesel prime-movers and the trailers. I have seen the trucks going along empty and I have seen them going along laden with stock. It is an interesting experience to see them. I mentioned that this form of transport has come to stay, lt will be improved upon, and the provision of good roads helps in the transport of stock. We do not oppose these bills.
– The two bills which are now being debated simultaneously by the Senate relate to Queensland and Western Australia, I hope that I will be permitted to be somewhat parochial in discussing the measures because I intend to discuss them as they affect Western Australia. I make no apology for being parochial in this instance.
– 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 negative.
– It is of vital consequence to Western Australia that this bill be passed by the Senate, as I have no doubt it will be passed. The bill provides for the construction of roads, which, I understand, are to be all-weather roads capable of carrying very large tonnages. Important consequences will flow from the provision of those roads. A proper road system in the Kimberleys will lead to a substantial increase in the production of beef in that area. I think every cattle man in the Kimberleys will agree with that proposition. Ask the people in the Kimberleys what they really want and they will say: “ Give us roads and water “. We are now giving them the roads. They will also get the water from the great Ord River dam.
I feel rather strongly about this matter of roads and water. The roads that are to be built will take the place of a railway. There will probably never be a railway in the Kimberleys because I think the day of rail trains is going. Road trains are taking their place. As a person who has lived for a long time on the goldfields of Western Australia, I appreciate the significance of a proper trade route to such an area. The leaders of Western Australia 70 years ago realized that the goldmining industry would never become a great industry without the provision of proper road or rail services. So a railway was built. It required great courage to spend money on a railway in a State as vast as is Western Australia. But the result was the creation of the greatest goldmining industry in Australia for a century an industry that has carried Western Australia for the last 50 years. The same observations apply to the Kimberleys. That area must have proper roads and adequate water. Those are the two basic requirements of this far-flung part of Western Australia. This region is enormous. Only those who have visited it can appreciate the tremendous distances in volved and the climatic problems with which residents of the area must contend. It is a country of great river systems and great heat. For one part of the year it is very wet and for the other part it is very dry. That condition poses problems for the person who wishes to raise cattle in the area.
The scheme envisaged by the bill to which I am referring should not be regarded in isolation. Although the bill is entitled the Western Australia Grant (Beef Cattle Roads) Bill I venture to suggest that it should be contemplated not just as a bill relating to the construction of roads for the transportation of beef cattle and not just as a bill relating to the construction of a system of roads. The bill is part of a pattern of development of this area in which the Government has taken a vital interest. The construction of roads is not the only thing that is happening in the Kimberleys. The Government is subsidizing the great air beef scheme. Some very interesting research is being carried out at the Pastoral and Agricultural Research Centre research relating to the growing of cotton and other tropical products. A geophysical survey is being undertaken in relation to mineral exploration. The Government is subsidizing oil search in the area. Shipping services have been improved. The Kimberleys area now has a reasonable shipping service. That service has been established with money provided by the Commonwealth. We have improved airports and a modern air service in the area, thanks to the ingenuity and interest displayed by the Minister for Civil Aviation, Senator Paltridge. The area is no longer isolated. Other great works are under way, including the provision of a radio telephone system which will connect this isolated region with the southern parts of the State. All this is being done with money provided by the Government.
I have omitted to mention the great Ord River scheme, which will irrigate vast areas for tropical agriculture. There you have a tremendous pattern of development, of which this roads scheme is one vital element. We should regard this measure against the background of that overall pattern of development. This is an inspiring story, but it is far more inspiring when you look at the area. The plan is then revealed as an amazing one. It will require an enormous amount of ingenuity, a great deal of money and a lot of courage to bring it to fruition.
Occasionally criticism is levelled at the Government for the manner in which it is going about the development of this area. The Government is asked why the area is not being developed more quickly. It is asked why expenditure on the area is not increased tenfold. The Government is asked whether the area is in danger of being invaded. Those matters are close to the hearts of Western Australians. Let me deal with the defence of the area. It is common cry to say that this area should be . peopled for defence reasons. That is not true. As a matter of fact, a large population of white people in the area would be an encumbrance so far as defence strategy is ..concerned. If there were 100,000 white people living in the Ord River valley they would not be able to defend that area. No matter how large the population was it could not defend that area. What we need there are defence posts, manned by men in uniform. They are the people to defend the area. When we talk about population for defence purposes I think we get a bit woolly in our thinking. What we need are defence posts. We have one at present at Darwin, and probably a second is required for the defence of the area. It should be a proper military post.
– Exmouth Gulf is a good area.
– There are in the area some good harbours that could be developed.
More than money is required for the development of the Kimberleys. Actually, the money that is now appropriated by the Western Australian Government and the Federal Government in any financial year is not all spent. Other mo-r.e important factors are involved. 1 refer to the. lack of skilled workmen and professional mcn. Australia has not sufficient skilled men, and they cannot be trained quickly. For example, we cannot train a geologist overnight, nor can we take one to this great region, and expect him to find base metals or oil immediately. The training of professional men is a long, painstaking task. The same applies to agricultural research. If we consider the long, laborious, courage ous, painstaking work that the agricultural research officer in charge of the Ord river project envisages, we see just how great is his problem, and how long it takes to solve such problems.
One of our real problems in the Kimberleys is a lack of knowledge of the area. We are not too certain when tropical agriculture will flourish. It will take some years for us to gain that knowledge, and a lot of patient research will be necessary. But first we must train research officers. I. repeat that the development of an unknown region over much of which no white man has ever walked is a laborious process. As I said earlier, many factors other than the provision of money are involved in the planning and development of great public works in this area and, the populating of it with white people who are devoted to the production of minerals and to tropical agriculture.
The immediate task envisaged in this legislation is the provision of roads for the transportation of beef cattle. The legislation is designed to assist in increasing our export income. Contemporaneously with that will be the development of the Kimberleys. That is a very worthy task about which nobody will quarrel. I do not need to elaborate its importance. We certainly need roads to enable us to increase the production of beef. But we need them for other purposes, too. That leads me to make one or two comments about where these roads should go. This measure authorizes the construction of two roads to the little town of Wyndham - one from Nicholson and another from Hall’s Creek via Turkey Creek. Those roads constitute just the commencement of this great roads plan. Ultimately, throughout the Kimberleys there must be an integrated network of roads or trade routes. I do not like the expression “ beef-cattle, roads “ which is used in the bill and by people generally. I prefer to call them trade routes, because they will be more than roads to be used for the transportation of beef cattle. These roads should be planned and used for other purposes. It is quite certain that some sections of the region, which is larger than Victoria, are heavily endowed with minerals. But those mineral fields cannot be exploited without the provision of trade routes or roads.
Tropical agriculture may not. be established in the Kimberleys in our time, but it cer,ainly will be established eventually. With great respect to my Queensland friends, sugar, cotton and half a dozen other tropical products will eventually be produced in the great Fitzroy and Ord river valleys in very large quantities. The production of those crops will maintain a large white population. Trade routes must be planned with that end in view. In all respects these trade routes in the Kimberleys will be equivalent to railways. In some places they will be almost as expensive to construct, because they are to be all-weather roads.
– You have some fairly big river systems there.
– That is so. We have some very wet country, with rainfalls of 40 inches a year or more. Every year floods many miles wide come down those rivers. So the construction of an allweather road becomes a rather expensive hobby. 1 come back to the location of these roads. It is proper, of course, to consider the particular two roads in question as being exclusively and expressly for the purpose of accelerating the production of beef. Our road system in the Kimberleys, which will take the place of a railway system, should be planned with three other important considerations in mind. I refer first to our defence needs. The Kimberleys road system - in fact all the roads of northern Australia - should be planned having regard to the defence of the area. The only good, black, all-weather road which exists in the north of Australia is that which was constructed during the war for defence purposes. That road had to be built; otherwise Darwin could not have been defended. The same argument can be applied to the defence of other parts of northern Australia. The defence of northern Australia will not be conducted completely from Darwin; other places will be involved.
We must also bear in mind the needs of our mining industry and of the tropical agriculture industry. If the network of roads in this area is planned with these considerations in mind, there will be no need for a railway system. We will have a reasonably cheap transport system which will be the life-blood of this region.
I conclude on that note. There is no need for me to elaborate this theme. The importance of roads in this area has been known for 50 years, and for the first time since federation this Government has accepted the responsibility of building roads. The Government should be congratulated upon its action. I really believe that henceforth we shall see the development of our great north.
– I would like to be as happy about this bill as Senator Vincent says he is. Here again we have an example of the dilatory attitude and procrastinatory approach of the Government. In the dying stages of the Parliament it is making a vote-catching gesture by throwing some money to Queensland, without any prepared plans. We know that the Queensland Government for years has been seeking money from the Commonwealth Government. Not so long ago that government presented a detailed plan in relation to roads for the Channel country, the Gulf country and the Cape York Peninsula. The Commonwealth Government received it very coldly. I propose later to refer to some comments in relation to the roads system which the Minister for National Development (Senator Spooner) made during a television interview recently.
Senator Vincent stated that this is the first occasion on which such provision has been made. I remind him that in October, 1949, the States Grants (Encouragement of Meat Production) Act, introduced by the Chifley Government, received the royal assent. That act was subsequently amended by the Menzies Government, I think in April, 1954. The Chifley Government act specified expenditure on particular roads in Queensland, whereas the bill before the Senate does not do that. The Chifley Government legislation also made provision for loading facilities and other matters associated with the handling of cattle. It provided that portion of the money should be used to establish watering places. No such provision is made in the bill before us. As Senator Benn has stated, there are many more aspects of the handling of stock and the production of beef than lbs provision of roads, although roads are necessary, of course. Because of the growing use of road trains for the transport of cattle, firm roads are essential, but when we think of the Julia Creek-Normanton road, which is the particular road under discussion and which was the basis of the first grant of £650,000, provided that the Queensland Government found £350,000, we find that that amount allows for an expenditure of approximately £2,200 a mile.
What kind of a road could be constructed in the Gulf country for £2,200 a mile? Any one who has a knowledge of that country will know that the amount is insufficient. Senator Scott knows rugged country as well as any honorable senator in this chamber.
– 1 know rugged politicians too.
– Do you? They are not all on this side of the chamber, I suggest. We must consider this bill in conjunction with the proposed expenditure of £350,000 in the vast area of the Northern Territory, an area that embraces the Barkly Tableland, the Victoria River area and much of- central Australia.
Senior Kendall. - £5,000,000, not £350,000.
– I am speaking of of the Northern Territory allocation in conjunction with the proposed expenditure of £5,000,000. It is all part and parcel of the one scheme.
As recently as June last, the Minister for National Development stated during a television interview that the scheme would require £20,000,000. But when it came down to the practical implementation of the scheme he was only prepared to vote £5,000,000, and even that amount is to be spent, not according to the wishes of the Queensland Government, but in accordance with the desires of the Treasurer (Mr. Harold Holt). He will have full authority to say where the money shall be spent, the types of roads to be constructed, and so on. There is no real authority vested in the Queensland Government, although that government knows the conditions that have to be faced. I have here a map showing the particular roads that were to be embraced by the scheme referred to in Brisbane by the Minister for National Development. A newspaper report headed , “ Approval for ‘ Beef ‘ Roads “ stated that a £20,000,000 network of 4,200 miles of bitumen, all-weather roads would be started soon in Queensland and the Northern Territory. What do we find? Queensland is to get £650,000 this year, and there is to be £350,000 for the Northern Territory. At that rate of expenditure it will be a long time before we see the implementation of the £20,000,000 scheme which the Government, through the Minister for National Development, is said to have promised the Queensland people, thereby making them - somewhat happy.
The honorable member for Herbert (Mr. Murray) has been blaming the State Liberal and Country Party representatives and saying that they are holding up the development of the cattle industry in the north. I say that the fault does not lies with the State at all. The honorable member made a long speech to a gathering of business people at Townsville, in which he tried to _place the blame on his political , associates in Queensland. Yet they have for years been making submissions to this Government for assistance. Two - years ago,, on the occasion of the opening of the Mossman show, Mr. Evans, the Minister for Development and Mines, said that this Government had been colossally neglectful of Queensland. The Premier has stated that the Government has been niggardly in its treatment of Queensland. Mr. Rae, the honorable member for Gregory in the Queensland Parliament, also had something to say in relation to roads. 1 hesitate to use nicknames, but Mr. Rae referred to Mr. McEwen as “ Black Jack “. He said that a great break existed between the Commonwealth Government and the people of the Channel country. He went on to say -
Federal Parliamentarians couldn’t care less about the development of western Queensland. This country provides the great bulk of the sheep and cattle wealth of the State, and we are asking for some measure of positive appreciation to be given to us. The only two who have any knowledge of the problems of the area are Mr. Brimblecombe and Senator Maher.
He made those statements on the occasion of a visit by a large number of Federal . parliamentarians. He said that the members of the party, other than two he named, were just out to enjoy their trip.
Those are some of the things that have been said about this Government which is now preening itself because it is throwing a titbit to the electors. The money that it is providing may never be spent. There is no assurance that it will be spent because it depends on the authority of the Treasurer. Mr. Rae went on to say - . . we in Queensland are sadly lacking in representation from the present members who are said to be on our side . . . They lack solidarity; they lack force-fulness and they lack the courage to put Queensland first in their representations . . . They lack many things; they are not really withus. I feel they are really not in touch with our needs. I realize I am levelling some of this criticism at our own men and possibly 1 will not get any bouquets for that . . .
He certainly will not. This miserable gesture is being made by the Government on the eve of an election and in the dying days of the Parliament, with no definite scheme to back it.
As recently as Monday last we saw an example of governmental gangsterism if ever there was one. This is the first time there has been any measure of appreciation by the Government of the needs of Queensland. The southern States New South Wales, Victoria and South Australia get the benefits all the time, and now they are trying to burgle this titbit that is being given to Queensland. They have ganged up. Representatives of those three States got together in Canberra on Monday and decided to try to criticize this bit of consideration that is being extended to Queensland. It should be realized that in Queensland we have 50 per cent, of the beef cattle of Australia. I think that the present cattle population of the State is 7,550,000. In the Northern Territory there are approximately 1,000,000 head. Scientists of the Commonwealth Scientific and Industrial Research Organization and of the State Department of Agriculture have said that that number could almost certainly be trebled’, and it is definite that it could be increased to 13,000,000 head.
Roads are part and parcel of the development of the cattle industry. If cattle could be moved earlier to good fattening country and if the ancillary services were developed, economic assistance would be given to such areas as central Queensland, where there are millions of acres of country that could carry great numbers of cattle and fatten them well. The cattle could be taken quickly to the meatworks and killed in prime condition. If that were possible we would have something worth while. It appears that there is a future for the beef industry. We have to take some risk in these matters. Our primary products, particularly our agricultural products, may be in jeopardy in the future, but it looks as though there will be a certain market for beef. There will be an increasing demand in our own country and there should also be an increasing demand overseas, with new markets being opened up. Therefore, we have to undertake as much development as we can. Nevertheless, we find that the Government makes a timid and miserable approach to the matter. I sometimes wonder whether the triumvirate of evil that has manifested itself recently through the activities of the Transport Ministers of New South Wales, Victoria and South Australia.
– How do you describe them?
– As a triumvirate of evil. That is what they are in this regard.
– They have a viewpoint different from yours.
– They have a selfish viewpoint which is entirely different from mine. Perhaps Senator Hannaford recalls that not long ago an organization was formed known as the Federal Inland Development Organization. The idea of those who formed it was to drag all of the cattle from south-westernQueensland to Bourke and from there to the Sydney market. Sir Thomas Playford’s idea is to drag those cattle down to Adelaide. No one seems to consider the rights of Queensland, and the meatworks that have been established in Cairns, Townsville, Merinda, Rockhampton and Bowen.
– You have copped the lot, but you won’t agree to it.
– We have not copped anything. There is no justification for assuming that we will get anything out of this. The Chifley Government, under its scheme, specified particular roads in Queensland. For Western Australia this Government has specified the roads from Nicholson Station to Wyndham and from Hall’s Creek, through Turkey Creek, to Wyndham, but it has not specified any roads in Queensland other than the first road for which provision is made - that from Normanton to Julia Creek. No other roads have been specified. In any event, any road work that is proposed is subject to the approval of the Treasurer, and the standards of the roads are subject to his approval also. The Government is not saying to Queensland, “ Here is £5,000,000 for the development of roads suitable for assisting the pastoral industry “. The Government is saying that, if it suits it to do so, it will make £5,000,000 available over a period of six years.
We say that more than roads are required. Incidentally, I am not certain that the road from Normanton to Julia Creek will be a success in a wet season. I do not believe that the amount of money to be spent will be sufficient for the construction of a consolidated road that would stand up to wet conditions. There is no provision for bridges over creeks, or for anything of that sort.
As I see the matter, this is merely a pre-election gesture. The Government has been dilatory and has procrastinated for as long as possible. It has even ignored the criticism voiced by its political associates in Queensland. There is no assurance that money will be provided for specified roads in accordance with a ‘ predetermined plan. I would prefer a scheme of greater magnitude, such as that visualized by the Minister for National Development (Senator Spooner). With his smoothness and suavity, I should say that he makes an excellent picture on the television screen. People referred to a former Premier of New South Wales as “Old Smoothie” but I would say that the Minister for National Development would out-smooth him at any time.
What are required in Queensland are all-weather bitumen roads, but they will not be provided. I say now that this measure is only a pre-election gesture, made by the Government in the last days of this Parliament. It is characteristic of the Go vernment that no opportunity for a fullscale debate of this measure has been provided. We are dealing now with matters of real importance. The measure could have provided an opportunity for full discussion of all aspects of the pastoral industry - pasture improvement, the use of fertilisers, the development of new land, the provision of finance and accommodation and so on - yet we are asked to deal with it on the last day but one of the life of this Parliament.
Let me say in conclusion that we are grateful .for what has been done. We in the northern part of Australia have to be grateful for the small mercies extended to us by the Government in its intolerance, arrogance and superciliousness. We are grateful for the threepenny bits that it throws to us.
Senator Sir WALTER COOPER (Queensland) [11.36]. - I am more optimistic than Senator Dittmer, who said that what is to be done for Queensland under this measure will be a failure. On the contrary, I think these beef cattle roads will be of great advantage to Queensland. They will permit the opening up of the cattle country to a great extent. I admit that this step should have been taken years ago, but it has been taken now and I welcome it. I am sure that the road between Julia Creek and Normanton will be a great success. That is the first road that will be constructed. The Federal Government will contribute £650,000 to the cost of the road and the State Government will contribute £350,000, making a total of £1,000,000. That is not a project that is being talked about. The work on it is in progress at present.
I believe that this road will give a great stimulus to the development of the Gulf country, which is devoted almost entirely to the -cattle industry. When the road has been completed, there will be no fear of cattle being trapped in that part of Queensland in dry times and being unable to get away. The cattle industry will be able to use. the road, not only to move cattle intended for slaughter, but, in times of drought, to move cattle to places where there is better feed. In the area around Julia Creek there is some very fine country that is not subject to droughts so bad as those that strike the Gulf country.
One of the difficulties encountered by cattlemen in the Northern Territory and in north-west Queensland is that in times of drought they cannot move cattle from their properties so that the cattle that remain will have enough feed to sustain them. With good roads, however, they will be able to shift the cattle by road trains. These road trains have been a great success on the Barkly Highway that runs into the Northern Territory and on the highway from Darwin to Alice Springs. They are not new. They have been in operation in the far west of Queensland and in the Northern Territory for a number of years. Yesterday the Senate passed a bill that will be of great advantage to the operators of road trains, because it provides that the prime movers are to be exempted from the sales tax. In future, therefore, the operators will be able to buy more road trains than previously with a given sum of money. The one fits in with the other. Exemption from sales tax has been granted on road trains and now all-weather roads are to be built to transport the cattle. These roads will be not only a great advantage to the cattle-grower himself but also a great advantage to Queensland and to the economy of Australia as a whole.
Senator Dittmer said that no plans had been made yet for the construction of the Normanton to Julia Creek road. This is the first beef cattle road to be built in Queensland. A sum of £5,000,000 is to be provided by the Commonwealth Government, not as a loan, but as a gift for the express purpose of building these beef cattle roads. The £650,000 that the Commonwealth Government is providing at the present time is portion of the £5,000.000 which will be made available by the Commonwealth Government. When the Normanton to Julia Creek project is finished the Queensland Government will have £4,350,000 left to spend on further roads. There are many other cattle districts in Queensland - the Channel country, the Gulf country, the far western Boulia district, and other districts that are crying out for roads of this type to be built, lt will be left to the Queensland Government to arrange a prior.ty plan for the various roads that we know are essential:
Before the money is made available the plans for these roads will have to be approved by the federal Treasurer. I see nothing wrong with that because, when all is said and done, it is the Commonwealth Government that is providing the money. There are no strings attached to this money except that the Commonwealth Government wants to know where each road is to be built so that it can decide that the roads are being built in suitable areas. The Queensland Government has also to conform to standards laid down by the Commonwealth. Again, as the Commonwealth is providing the money, it is for it to see that proper standards are maintained. I do not suggest that the Queensland Government would construct a poorly-built road that would not stand up to the job of transporting cattle, but if it were to do so the money would just be thrown away. I think it is a sound idea for the Commonwealth Government to insist that the roads are up to an efficient standard.
Recently I read an article in the broadcasting and television magazine dealing with the export of cattle to Hong Kong. It was written by Mr. Warren McDonald, chairman of the Commonwealth Banking Corporation. In the article Mr. McDonald tells of an interview he had with a man -in Hong Kong who recently built large abattoirs and a freezing plant for the purpose of processing Australian cattle. This man had bought a consignment of cattle to be delivered on a certain date. When Mr. McDonald visited the abattoirs the proprietor told him that the cattle should have been delivered three weeks previously, and that as a result of the nondelivery his works were idle. Mr. McDonald returned to see the man some time later and found, that the cattle from Australia had still not arrived and that the man had been forced to process 80,000 ducks from Communist China and sell them to the United States. Further, he had decided to go to Indonesia to see whether he could purchase buffalo meat instead of the Australian cattle that had not been delivered.
At the present time it is quite easy for a situation such as that to develop. The cattle were probably bought on the hoof and it was expected that they would be taken to the railhead by a drover. Possibly the stock route was dry and they were unable to travel. As a consequence they were not delivered to the railhead to be shipped to Hong Kong. Not only was that particular order lost but the man in Hong Kong would be very chary of buying Australian cattle in the future. Had these beef roads been in existence there would have been no difficulty in delivering these cattle. The man in Hong Kong could have given a firm order and have been assured that the cattle would be delivered on the dates when he required them. They would have been put on the cattle train and no trouble would have been experienced in getting them to the railread and down to the coast for shipment to Hong Kong, the incident 1 have quoted demonstrates the necessity to have good roads on which cattle can be brought to the coast.
In Queensland there are meatworks at Cairns, Townsville, Rockhampton, Gladstone, Brisbane and in some inland districts. Those meatworks would be better supplied if” there were road trains operating at the present time. Senator Dittmer suggested that if there were good roads in the southern part of Queensland cattle might be taken tb centres in New South Wales, or to Adelaide. The point is that the cattle belong to the cattle owners and if they can get better prices in Sydney, Melbourne or Adelaide naturally they will send their cattleto those centres. That is what they should do. We have no right to say that the cattle must remain in Queensland and be sent to the meatworks in that State. As private enterprise keeps the cattle industry going, surely the cattle men have to be considered. If they can get a better price anywhere else, that is where their cattle will go. I say, “ Good luck “ to them. I have no doubt that our Queensland meatworks will be kept going. Perhaps they will have to give higher prices, but that makes no difference as long as they have the cattle. The cattle will be there, and they will be treated in the meatworks in Queensland as well as in the other States.
Quite a number of cattle have been brought to Cairns from the Gulf country, and especially the Cape York Peninsula, by sea transport over the last few years. Army landing barges have been used. Unfortunately, when I was in Cairns a few weeks ago, I found out that the barges had been wrecked. I believe it would be worth while for the Government to consider whether it could provide a subsidy for transport of that kind. The meatworks themselves or some outside company could purchase Army landing barges fairly cheaply. That would enable the meatworks to continue to get their cattle by sea in that part of Queensland. In the Cape York Peninsula especially, droving conditions are bad and there are practically no roads at all.
In conclusion, I say that I am very glad that these beef roads have been started in Queensland. I hope that at an early date plans will be produced for the construction of other roads in the southern and other parts of Queensland. I am sure that these roads will be of great benefit, not only to Queensland, but to the whole of Australia.
– I rise with some diffidence to speak on these two bills because I find that an arrangement has been made that the two bills be debated together. I am somewhat amazed, when I study the two measures and find that they are so dissimilar, that the Senate would agree to debate the two .bills together. Nevertheless, that has transpired through the ignorance of people who do not understand the complexities of the two relevant areas of Australia; namely, the Kimberleys in Western Australia, and northern Queensland. I say with due respect to honorable senators who have spoken on these measures that they do not understand the problems associated with the two areas. I will have more to say about that at another time.
The Commonwealth Government’s proposal in respect of Western Australia is to spend £500,000 on the development of two beef roads and two bridges. The two roads, the construction of which the Government proposes to assist under this legislation, are 504 miles in length. There are 242 miles from Wyndham to Hall’s Creek through Turkey Creek, and 262 miles from Wyndham to Nicholson. Western Australia will have £500,000 to spend on those 504 miles of road. In addition, it will provide half the money for the construction of the two bridges. When I look at this legislation I find that one of the bridges for which money is to be provided is over the top of the barrage at Bandicoot Bar. Bandicoot Bar itself is 400 yards wide. The proposal is to put a bridge across it and a road around the foothills into Wyndham, because the present road from Wyndham out to Bandicoot Bar is usually about 8 feet under water in the wet season. In order to provide an all-weather road, the proposal is that the road go over Bandicoot Bar and around the foothills. That will be a completely new road. It will have a distance of about 90 miles. In addition to providing half of the money for the bridges, Western Australia will have to construct 90 miles of new road. It is not a case of reconditioning a road. Yet Western Australia will have the miserable sum of £500,000 to spend on 504 miles of road, including 90 miles of completely new road. Senator Scott is doing a lot of laughing about this, but he should be vitally interested in it. The money that the Commonwealth Government is prepared to provide for Western Australian roads is just a drop in the ocean.
– Do you know what you are doing? You are looking a gift horse in the mouth.
– We do not oppose the legislation, but we criticize the Commonwealth Government for trying to convince the people of north-western Australia that it is trying to do something for them at this time just before the election. We expose the weakness of the Government’s case by directing attention to the paucity of the support that it proposes to give.
– You would give more, just like in everything else that you Labour boys go in for.
– You have exploited the north-west of Western Australia for long enough. If you want me to open up-, you just keep going, and I will expose how you have exploited that area.
– Order! I ask the honorable senator to address his remarks to the Chair.
– Will the Minister stop the interjections?
– If you want to go on with it, that is O.K. by me.
– It is O.K. by me, too. Carry on; I do not mind.
– In addition to the bridge that has to be constructed over the barrage at Bandicoot Bar, another bridge has to be constructed over the Dunham River. Those two bridges, plus 90 miles of completely new road and about 500 miles of road from Wyndham to Hall’s . Creek and Wyndham to Nicholson have to come out of the £500,000. How much good does the Government think that money will do in providing means for the transport of cattle in the Kimberleys?
It is interesting to know that the road transport of cattle to the Wyndham meatworks was tried on a rather large scale this year. During the 1961 killing season, approximately 10 per cent, of the cattle were brought to Wyndham by road train. By trial and error, the percentage of bruising of cattle has been reduced to approximately 8 per cent. How much better the position could be if the Commonwealth Government were prepared to undertake . the development of northern Australia in a proper manner and provide decent roads for the transport of beef cattle!
– What would it cost to provide decent roads in the north-west?
– I am not an engineer and would not know.
– What roads would be required?
– There would have to be roads north of the Fitzroy River leading into Derby. There would have to be roads south of the Fitzroy River leading into Broome. There would have to be roads leading into Wyndham not only from the Halls Creek area but also from the Northern Territory, because Wyndham is quite close to the Victoria River area and large numbers of cattle are at present trekked across the Northern Territory into Queensland, held there as store cattle, fattened and slaughtered in Queensland abattoirs. The natural place for those cattle to go is the Wyndham abattoirs instead of being taken thousands of miles into Queensland. It would be very hard to estimate what such roads would cost.
Their cost would depend on how far the State Government and the Commonwealth Government were prepared to develop the northern part of Western Australia and what effect the Air Beef scheme had on that development. It may be found more economic to use the Air Beef scheme rather than to construct roads. It is conceivable that beef could be carried over the rather flat country of the area and along the riverbeds by hovercraft. All these matters are problematical and are subject to a great deal of experimentation. Millions of pounds could be spent in northern Australia on the development of roads. Roads are not the complete answer to the beef industry or even to the development of northern Australia. It appears that at this stage the Commonwealth Government is limiting its activities to the development of northern Australia insofar as beef only is concerned. The development of road trains should be fostered because they enable beef cattle to be turned off the country at a much younger age. They enable fat cattle to be brought into the abattoirs at a much earlier stage without having walked fat off on the way.
It has been said that the people of Queensland should be grateful because the Commonwealth is providing up to £5,000,000 for the development of beef cattle roads in that State. That is not the case in Western Australia, because the Western Australian Government is required to spend an amount equivalent to the amount being granted by the Commonwealth. That money must be spent on the development of roads north of the 20th parallel. But the Commonwealth Government states that it shall be the arbiter as to the standard of roads constructed..
– That is fair enough, is’ it not?
– It would be fair enough if the Commonwealth were providing all of the money, but it is providing only 50 per cent, of the money. Surely the State should have some say if it is providing the other 50 per cent.
– Every penny that the State spends on roads comes from the Commonwealth.
– Let us not become embroiled in that argument, because the Commonwealth raises all the finance and the States merely spend what is allocated to them. The Commonwealth gives the States a certain amount of money. It does not tell them how they shall spend that, money. But in respect of beef cattle roads in Western Australia, the Commonwealth is saying that roads of a certain standard shall be built. That proposition is different from the proposition as it affects Queensland. If engineers in Western Australia are of the opinion that a particular type of road is sufficient to meet the needs of a particular area, the Commonwealth Government should not have the authority to say that it does not approve of the road and therefore will not provide finance for it. The Labour Party does not oppose this bill but it is very critical of the Commonwealth Government’s lack of responsibility so far as the development of this area of the country is concerned.
Thursday, 26th October 1961.
– I am very glad to be able to speak in support of the two bills before the Senate. My only regret is that the amount being’ provided under them was not made available earlier. It is gratifying to see that about £5,000,000 is to be spent in Queensland over a period of five years. I hope that within the next five years that amount will be augmented. The road that has been decided on from Normanton to Julia Creek is satisfactory as a starting point. It is good strategy to start at the top and work south as money, material and plant become available. I note that the roads to be built are to be decided on by the State Government and approved by the Commonwealth Government. That is only fair.
I take this opportunity of refuting suggestions made earlier that the southern Stales are completely indifferent to the needs of States and areas such as Queensland and the Northern Territory. Time and again we have heard people living in the southern States - even people living in Tasmania - acclaim the wisdom of developing the northern area of this country.
Although the roads to be built in accordance with this legislation are very welcome, what is badly needed in this northern area is a long-range plan of development. If the Government has in mind any such plan it has not made the position clear. We must develop an overall plan and, having developed that plan, must decide who shall implement it. If a commission like the Snowy Mountains Hydro-electric Authority is not considered to be practicable, I believe we must look to the Department of National Development to do the job. It may very well mean a considerable enlargement of the department, but somebody must do the work. We cannot have the work done piecemeal, part of it being done by each State.
A rather disparaging reference was made to the Federal Inland Development Organization, otherwise known as F.I.D.O. This organization was developed mainly as a result of the enthusiasm of Mr. B. P. P. Lewis who, incidentally, comes from my district. About two and a half years ago, he approached me and asked me what I thought of the idea. The scheme that he suggested was not the scheme that is being advanced to-day. But he hoped to do something about constructing a road to get cattle out from the Channel country, particularly in time of drought. I said I thought it was a very good idea, and that I would like to do anything I could to help him. He obtained the support of graziers in his own area and adjoining areas. Eventually, last year, he formed the Federal Inland Development Organization at Bourke. Members of the organization will be meeting herein Canberra to-morrow night to see what they can do to assist in the development of the north of Australia. They are not concerned merely with the matter of roads. This organization is doing very good work for Australia. Those who make disparaging remarks about its members are not giving them the credit that is their due but are displaying lamentable shortsightedness.
It has been alleged that the aim of F.I.D.O. was to attract cattle down to the southern States. The principal aim in suggesting that a road known as the Pioneers Highway should be constructed from Bourke through the Channel country was to get cattle out when necessary, and also to provide a means of taking cattle in when restocking was necessary. The idea has gained support in the face of quite a lot of opposition from some Queensland people, who felt that Queensland meatworks would be deprived of a source of cattle they had enjoyed previously. However, it seems that those Queenslanders who were originally opposed to the idea have now become reconciled to it. The road will link up with Queensland’s east west railroads. So the Queensland killing works will have first access to the cattle, which is quite a fair proposition. But, as has been stated here to-night, surely the ability of the producers of the cattle to get their beasts to the best market should be the first consideration. Whether that market be in Queensland, South Australia, Victoria or New South Wales is beside the point. We must remember that there has been an annual loss of approximately 100,000 head of cattle in the Channel country, through which this highway will pass. A great saving tothe whole of Australia would be effected if we could prevent the loss of those cattle. It is fairly well recognized that for every fat beast that is taken off another beast dies.
At this time we are afforded an opportunity to pay a tribute to this organization, the sole aim of which is not personal gain or aggrandizement, but the development of these inland areas. I regret that time will not permit me to continue in this vein. I heartily support the bill, and sincerely hope that it will prove to be a considerable step forward in the development of our inland areas.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Consideration resumed (vide page 1462).
Question resolved in the affirmative.
Bill read a second time.
– One anxietyI have had about this bill, and the measure which dealt with the provision of finance for beef cattle roads in Queensland, is that they are capable of undermining the security that flows from parliamentary responsibility. It will be noted that the roads and works which are to be financed under the terms of the bill will be subject to the approval of the Commonwealth Treasurer, irrespective of the political colour of the government of the day. The measure appropriates a considerable amount of money for works to be approved by the Treasurer without the essential parliamentary safeguard that we have established in regard to appropriations by the Parliament for ordinary Commonwealth works. I refer to the Public Works Committee.
This has been a long fight. For a long time it was not regarded as essential that a parliamentary committee should investigate public works projects involving an expenditure exceeding, I think, £250,000. I direct attention to the anxiety that any member of the Parliament must feel about this development whereby assistance is given to a State to undertake projects selected by the State Government, and approved in the Commonwealth sphere only by the Treasurer. To my mind, the need for the approval of the Commonwealth Treasurer is not an adequate safeguard. I am not opposing the bill. Despite the fact that it provides nothing for Tasmania, it does provide something for the development of northern Australia, which is essential to the maintenance of this nation.I do not intend to oppose the bill because of the absence of the safeguard I have mentioned, but I hope that in future, in relation to proposals such as this, we will impose the safeguard that the Public Works Committee of this Parliament shall have the opportunity to say whether or not it approves of them.
It seems to me that a method whereby a State government selects a project and the Treasurer in this Parliament approves of it or disapproves, is a hitormiss method. What we should have for the development of this part of our national responsibility I mean by that expression to obliterate the idea of State boundaries is an independent advisory or executive commission. It could synthesize the development of that part of the Australian continent north of the Tropic of Capricorn, adopting a comprehensive, non-political view. It could recommend projects that it considered should be supported, stage by stage, by finance provided for national development. In other words, we should have an integrated, co-ordinated commission to advise on the projects that should be commenced from time to time, instead of the present hitormiss method of developing the north of Australia. I submit those thoughts for the respectful consideration of the committee.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Senate adjourned at 12.24 a.m. (Thursday).
Cite as: Australia, Senate, Debates, 25 October 1961, viewed 22 October 2017, <http://historichansard.net/senate/1961/19611025_senate_23_s20/>.