24th Parliament · 1st Session
The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers.
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Assent to the following bills reported: -
Income Tax and Social Services Contribution (Rebate) Bill 1962. Income Tax and Social Services Contribution (Provisional Tax) Bill 1962.
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– I direct a question to the Minister representing the Minister for External Affairs. Will the Minister comment on the claims attributed to General Nasution of Indonesia that Australia is coming closer to the Indonesian stand on West New Guinea and that a change in view is clearly perceptible from the differences between the Prime Minister and the Leader of the Opposition, Mr. Calwell? If the Minister agrees with the general’s claims, will he” indicate in what way Australia’s policy has changed? If he disagrees with the general’s claims, will he take steps to publish his disagreement and endeavour to see that it receives the same publicity throughout the world as the general’s statement has received?
– Clearly, from reports in the press of what General Nasution said, I cannot know exactly what he said, or what he had in mind or what the whole context of his speech was. But it may well be that he would have borne in mind the fact that some years ago, during the visit of the Indonesian Foreign Minister to this country, the Government publicly indicated that it was not a party principal to the dispute about sovereignty over West Irian and that it was prepared to acquiesce in the1 transfer of sovereignty as between the two countries most vitally interested in the territory. That might well appear to General Nasution to be a quite different approach from that which the Leader of the Opposition indicated a month or so ago, which seemed to indicate quite clearly that he believed that Australia should in fact go as far as declaring war, if necessary alone, to prevent a change of sovereignty. It may be that that, which is a difference of approach, could have been in his mind.
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– My question, which is directed to the Minister for National Development, relates to the most interesting announcement made in the press recently of the discovery of phosphate rock in the Northern Territory. Has the Minister anything to add to the particulars of this most interesting and important discovery? Would the Minister care to outline what the policy of the Government might be in the event of this discovery proving to be economically workable? Would the Government consider handing over the proposition to a reputable private company for exploitation and development?
– I cannot add a great deal to the press statement that I made. What happened was that officers of the Bureau of Mineral Resources were searching for uranium and they got a faint radioactive reaction. On making further investigations, they found this phosphate rock. I think they found four occurrences of it over a distance of about 2 miles. The area has yet to be drilled and it has yet to be proved. Its great importance is that it is the first reported discovery of phosphate rock on the mainland on Australia. Its great professional interest is that it has been found in pre-Cambrian rock, which I understand to be of a very early geological era, and this is the first known occasion on which it has been found in that type of rock. I have, of course, approved a prospecting programme to do as much as we can to find out the size and the consequence of the phosphate. In those circumstances I think it is too early to try to envisage what sort of a policy we shall adopt in relation to it. The discovery has been made in the Hundred of Goyder, which is the area reserved for the Rum Jungle activity. In the Hundred of Goyder the prospecting rights are held by the Crown. I do not know whether that is a correct legal definition, but for all practical purposes in the Hundred of Goyder the Government has the say, because that is the area in which uranium was found.
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– I should like to direct a question without notice through you, Mr. President, to the Leader of the Government. I preface my question by saying that it is consequent upon one that I asked last week when the Minister accused me of including insulting comments in some of my questions relating to the European Common Market. Since then I have taken the trouble to examine many of my questions to see whether the Minister’s assessment was correct, because I know that I always couch my questions in courteous language and my dealings with everybody are always courteous. The questions may be critical, but I am unable to accept the Minister’s rebuke that I have been insulting. I trust that the Minister will accept my sincere assurance in this regard.
– Order! Is the honorable senator asking a question?
– I am coming to the question. In answering my question relating to the Statute of Westminster and the Common Market, the Minister said that they had nothing to do with one another and the former dealt only with the question of allegiance to the Crown. Without being in any way offensive to the Minister, may I ask whether this is not typical of the antiquated thinking of the Government? Perhaps the Minister has had time to reconsider his statement, and if so will he now agree that the old Commonwealth has been superseded by a new Commonwealth in which there is no common allegiance to the Crown, no common language, no common traditions and no common culture, and which consists of diverse races?
– And a Common Market.
– I wish Senator Scott would listen. He would learn.
– It was not I who interjected.
– Order!
– Does the Minister agree that the Commonwealth now consists of nations whose relations to one another are primarily political and commercial? That is why I asked my question last week to which the Minister, in my humble opinion gave an answer which was not correct, which evaded the issue and which resulted in-
– Order! The honorable senator must ask his question.
– Sir, I am coming to the question now.
– I have been patiently waiting for you to come to it.
– Did not the
Minister’s answer last week result in one of the Minister’s legal luminaries jumping to his feet and setting up another doll dressed in exotic robes? Now the question, Sir, is this: Finally, can the Minister tell me when the report of the proceedings between representatives of the United Kingdom, New Zealand and Australia, held some two and a half or three years ago, and about which the Minister was so enthusiastic that he has never made any reference to it, was tabled in the Senate?
– Order! I direct the honorable senator’s attention to the fact that that is almost an impossible question to answer. There is far too much preface to it altogether. I ask the honorable senator to restrict himself in future to the questions themselves.
– Thank you, Mr. President. The question is: Will the Minister now tell me when the papers of the conference held between representatives of the United Kingdom, New Zealand and Australia regarding the European Common Market were tabled in the Senate?
– Mr. President, here I go, full of hope that I can reply to the question. I start off with the assumption that Senator Hendrickson was rather apologetic for not being as courteous as he might be, and that he and I enter a new era with a fixed determination to be courteous to each other. To that sentiment I subscribe 100 per cent.
The second part of the question is more confusing to me. Last Thursday Senator Hendrickson addressed to me a question without notice and asked whether the constitutions of the European Economic Community would cut across the relationships legally expressed in the Statute of Westminster. Off the cuff, I said that I did not think the matter was relevant to the European Common Market, because the Statute of Westminster dealt with the legal status of this country in relation to the British Crown. I still think that might be a correct answer to that question.
asked subsequently whether the United Kingdom’s membership of the Common Market would reduce the economic powers or the capacity of the British Parliament. It was a very good question and I am glad I did not have to answer it. The subject requires a little bit of thought. I still think that the matter is not related to the Statute of Westminster, but I say that with a lot of diffidence because it is a legal question. Senator Wright in his question referred to an article in an overseas newspaper. I meant to ask him for a copy of the article so that I could read the point to which reference was made. I think that if the United Kingdom enters into these arrangements, which are in the nature of trade arrangements - inter-governmental arrangements - then a new kind of atmosphere is created and a new set of conditions is formed which has its variations. As to the proceedings that took place about two and a half years ago, I am sorry, but I do not remember the event. I do not remember the question so that I cannot give an answer.
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– My question without notice is directed to the Minister for Health and refers to the outbreak of the sirex wasp in Victoria. Is the Minister in a position to give any information on the measures that have been taken to combat this wasp and whether they have been successful in containing the wasp within the first area to be affected?
– The committee recently set up by the Commonwealth and the States to control and eventually to eradicate - and I emphasize the word “ eradicate “ - the sirex wasp is functioning swiftly and adequately. As far as can be ascertained at this point of time, the main infestation is confined to an area some 20 or 30 miles east of Melbourne. It seems to follow a fairly well-defined pattern and we hope that the infestation will be confined to that area. There is no certainty, however, that such will be the case. The committee is approaching its problems very realistically. It is doing its utmost to publicize every new infestation and to make the public aware of the dangerous nature of this pest. All in all, we are hopeful that we are making really worthwhile progress.
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– I should like to address a question to the Leader of the Government in the Senate, or the appropriate Minister. My question is important because it touches on a matter that could affect the national economy as well as the actual marketing of wool. I ask the Minister whether he is aware that the 1962 Annual Wool Section Conference of the Farmers Union of Western Australia, which represents those who produce 82 per cent, of all wool produced in that State, passed the following resolution: -
This Conference, having considered the official precis of the Wool Inquiry Committee’s Report considers it unsatisfactory. It expresses disappointment that the Federation submission for a Reserve Price Plan has not been recommended and that no practical alternative has been suggested.
The Conference re-affirms its belief already endorsed by the Federation that an overall Wool Authority will not bring any practical benefits to wool-growers unless effective marketing safeguards are introduced.
Is the Minister aware that wool-growers throughout Australia consider that the Government has been procrastinating and delaying the introduction of an effective method of marketing wool, while they have lost considerably as a result of that procrastination and the economy of Australia has suffered? I ask the Minister whether he is aware that the Farmers Union passed the following resolution, also: -
Having recognized the defects of the present auction system in forward selling and pies, the Committee of Inquiry has asked growers to take measures in the future to counteract these present menaces when it was unable to do so after l4 months of intensive investigation. We therefore demand that a ballot of wool-growers on a Reserve Price Plan as operated in New Zealand and South Africa be held.
Will the Minister give; some assurance that positive action will be taken to obtain a ballot of woolgrowers on this most important question?
– I am aware, as we all are aware, that quite a substantial section of the wool-growing industry was disappointed to learn that the committee established to inquire into wool marketing did not come out with a firm recommendation for a reserve price plan. My only comment on that is that the committee, in its wisdom, after taking evidence, going overseas, and making intensive inquiries, came to a conclusion on the material put before it and brought down its recommendations accordingly. I say again that some sections of the industry were disappointed. Other sections, which are also disappointed, have adopted this attitude: Where do we go from here? At least here is a report upon which to make another start. I believe that they are, in the main, prepared to examine the report, get together, and see whether they can hammer something out of it to meet their needs. Senator Cooke asked why the Government would not take a ballot on a reserve price plan. I put it to you, Mr. President, that no government can take a ballot on a notion, which is exactly what the honorable senator is suggesting. The industry itself has not arrived at any conclusive plan that it wants to put into operation. I repeat what I said in the Senate just a week ago, that is, that this Government will not foist on any industry a plan that the industry does not ask for. The final point I want to make is that the Government is waiting and anxious for the industry to analyse this report, to come to a considered opinion and to make an approach to the Government with one voice. I assure the honorable senator that when that is done, the Government will put the needs of the wool industry first.
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– I direct a question to the Minister for National Development. I mention with appreciation, by way of preface, that I understand that the Australian Atomic Energy Commission will be holding an exhibition in Adelaide between 13th and 23rd June, 1962, and also that the commission will participate in the exhibition of the South Australian Chamber of Manufactures about Easter time 1963. Can the Minister yet indicate generally the type of display envisaged for each exhibition? Will the exhibitions focus attention on the peaceful uses of atomic energy in the light of the fact that South Australia and the
Northern Territory are portions of Australia where significant economies in the use of atomic energy for power generation are becoming apparent? Could a model of an atomic power station also be included in one or both of these South Australian exhibitions?
– The department will be holding two exhibitions in Adelaide, one at Easter and another in June. It was contemplated originally that only one exhibition would be held, but Senator Laught brought representatives of the Chamber of Manufactures to see me and, as a result of their representations, it was decided to hold a second exhibition. I have not seen the details of the proposals, but I should think the exhibitions would cover, first, uranium mining, with models of the Rum Jungle plant in operation; secondly, power production, with a model of Hifar, the research reactor at Lucas Heights, and with up-to-date information about the cost of generating electricity by nuclear power and by thermal power; and thirdly, samples, diagrams and pictures of isotopes in use in industry and in medicine. All in all, the exhibitions of this kind that I have seen elsewhere have been very interesting, and very rewarding to those who have seen them.
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– My question is directed to the Minister for National Development. Is it believed that, if oil deposits in com*mercial quantities were found at Moonie or elsewhere, the cost of providing equipment to deal with the oil at the bore outlets, of ing it would exceed £1,000,000,000? Would this cost have to be incurred by each company which succeeded in discovering oil in commercial quantities in Australia? Will the Minister tell me how a sum exceeding £1,000,000,000 could be raised in Australia by a wholly-owned Australian company which discovered oil in commercial quantities?
– Senator Benn must be under some misapprehension. The estimated expenditure ot £1,000,000,000 which I mentioned in reply to a question does not relate to Moonie alone. The estimate of £1,000,000,000 - a very conservative estimate - relates to the cost of providing the whole of Australia’s petroleum requirements in five years’ time. We are now using 88,000,000 barrels of crude oil a year, and it is expected that the demand will increase at the fate of 5 per cent, or 6 per cent, a year, as it has done in the past. Those who made the estimate worked out how many holes would have to be drilled to provide the quantity of oil that Australia will need in five years. They made the supposition that there would be a certain level of production from each hole. Then they worked out the cost of the drilling and the cost of transporting the oil by pipeline to refineries. As I have said, the estimate referred, not to Moonie alone, but to the whole of Australia.
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– Would the Minister representing the Treasurer care to comment on the large special grants made in recent years to the State of Western Australia, and on the effect of those grants on the progress of the State? Does the Minister think that these grants have played a vital part in the development of the State, and that they have greatly assisted the State Government in pursuing a vigorous and imaginative policy of expansion and of attracting private capital to the State? Further, will the Minister comment on statements made by the Leader of the Opposition to the effect that Federal Government activities had no place in the State election, and on the article in this morning’s “ Sydney Morning Herald “ which claimed that the Government parties in Western Australia had lost ground in recent months?
– The question is a large one and I shall answer it as briefly as I can. I do not think any one will disagree with me when I say that the special grants made by the Commonwealth to Western Australia in recent years, the claims for which have been well-presented, well-documented and justified, have favourably influenced to a considerable degree the progress of that State. I am happy to say that on the appropriate occasions the Premier of Western Australia, the Honorable David Brand, who, fortunately, remains the Premier to-day, has acknowleged that fact in generous terms.
I have been asked by the honorable senator about the statement made by Mr.
Calwell to the effect that Federal Government activities had no place in State politics-. I know that was the line that Mr. Calwell and his deputy, Mr. Whitlam, tried very hard to plug during the recent State election campaign. If Mr. Calwell now says that Federal politics had no influence on the result of the State election, he acknowledges the futility and the stupidity of his own visit to Western Australia, because he screamed from every forum that he could find that the election was to be decided and would be decided on federal issues. He went so far as to say, and I am amused to recall it, that the three federal Ministers from Western Australia, Mr. Hasluck, Mr. Freeth and myself, were not game to leave our parliamentary offices to take part in the campaign in support of the Liberal Government of Western Australia. We did not protest very much at the time, because Mr. Calwell was being branded a teller of untruths out of his own mouth. While he was saying that, Mr. Hasluck was working in his own electorate, Mr. Freeth was working in the Forrest electorate, and I was working in the metropolitan and outer metropolitan area. People were asking us, “What is Mr. Calwell’s reason for saying that you are not taking part in the campaign? “ We welcomed the statement because it gave point to the criticism we were making of Mr. Calwell and the Labour Party generally - that you could not rely on anything they said as being the truth. So, Mr. Calwell missed out badly on that one.
As for the article in this morning’s “ Sydney Morning Herald “, one has to take account, of the fact, of course, that the “ Sydney Morning Herald “ these days, in exercising the freedom of the press, has devoted itself to the destruction of this Government. Having regard to that fact, it is not surprising that the article referred to should display either a disinclination by the gentleman who wrote it to face up to the essential facts, or a desire wilfully to mislead the public. When he wrote of the Government parties having lost ground in the last few months and quoted percentages to try to support this foolish theory, he overlooked the fact that of the 50 seats in the State House, eleven were not contested last Saturday. Seven of those were not contested by Labour party candidates and four were not contested by candidates representing the Government parties. Of the four seats not contested by the Government parties two are in the northern part of the State, which has comparatively few enrolments. The seven seats not contested by the Labour Party are seats which are always won by extremely large majorities for the Government parties. The gentleman who wrote the article drew the inference that the election result showed a drift of support from the Government parties in recent months. That indicates - I accept what my friend Senator Scott says - that the gentleman, if he was fair dinkum when writing the article, was just plain dumb. But probably he was not. Everybody knows that the “ Sydney Morning Herald “ is as fanatically and as viciously opposed to this Liberal-Country Party Government in Canberra as the stupid Communist press is viciously and fanatically opposed to capitalism.
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– Will the Minister for Civil Aviation confirm or deny a report, to which some credence has been given, that Mr. Ansett, the managingdirector of Ansett-A.N.A., will go to France to buy Super Broussard turbo-prop aircraft with which to replace the present D.C.3 aircraft of the Ansett-A.N.A. fleet? Does the other major internal airline intend similarly to replace its D.C.3 aircraft? Will money to meet the initial expenditure involved - £450,000 - be made available also to Trans-Australia Airlines? Does the Government want the two airlines to replace their D.C.3 aircraft? What arrangements are being made for T.A.A. to make its own selection of replacement aircraft to a value equivalent to that of the aircraft selected for replacement of D.C.3’s in the Ansett-A.N.A. fleet?
– The purchase of replacement aircraft for the D.C.3 is something that the airlines must consider in due time. I saw this morning for the first time the public statement that Mr.. Ansett was interested in looking at the Super Broussard. a French production, as a replacement for the D.C.3. I have no doubt that if Mr. Ansett moved in that direction, a similar interest in the replacement of D.C.3’s would be shown by T.A.A. I make it quite clear to the honorable senator, lest there be any misunderstand ing on the matter, that the replacement of D.C.3’s will not involve the Government in the provision of a financial guarantee. Therefore, Mr. Ansett is not stepping outside any agreement that he may have with the Government or with T.A.A. in respect of finance for aircraft. The Ansett-A.N.Ai organization purchased Friendships from resources that it found for itself, when it could in fact have used a Government guarantee. On this occasion any new aircraft that are purchased by the private enterprise firm will be paid for out of its own resources also.
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– Is the Acting Minister for Trade aware of the very great success that attended the wool festival held recently in Launceston, which is known as the wool city of Australia? Does the Minister feel that benefits would accrue to this important industry if similar festivals were held annually in other important Australian cities?
– Without doubt the wool festival held in northern Tasmania last week was one of the greatest festivals ever held in Tasmania. The festival was held in a city which, as the honorable senator has said, is vitally interested in the wool industry. A number of factories handling wool have been established in the Launceston area. I am confident that the festival brought home more than ever to the people of Australia the vital part that wool, as a staple, plays in the prosperity of our country. I believe that the suggestion made by the honorable senator - namely, that similar festivals be held as often and in as many parts of Australia as possible - would bring home to all the people of Australia the vital part that wool plays in the Australian economy and the fact that the only country in the world which has an interest in developing wool as a staple is Australia. I conclude my answer by recounting the last two lines of a speech that was made at the Launceston festival by one of the great woolgrowers in Tasmania. He said -
Wool has kept Australia off the financial rocks, So sec you always wear it from your hat down to your socks.
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– My question is directed to the Minister representing the
Attorney-General. Has the Minister’s attention been directed to reports circulating io Victorian building circles that a large concrete manufacturing company, registered in New South Wales and operating in Victoria, has secured a form of monopolistic control, direct or indirect, over virtually all concrete roof-tiling supplies and contracts in Victoria? Will the Minister have inquiries made to ascertain whether the alarming reports about the company’s methods of obtaining control are in fact true? These reports include allegations of bribery, conspiracy and economic blackmail being used against the few remaining independent spirits. If the facts warrant it and if the necessary evidence is available, will the Minister authorize and undertake criminal prosecutions under the existing antimonopoly laws - namely the Australian Industries Preservation Act - without delay?
– I will direct the attention of the Attorney-General to the honorable senator’s questions so that he may find out, first, whether the allegations that the honorable senator has made are correct and, secondly, whether action can be taken against the company under the existing Australian law. I direct the honorable senator’s attention to the answer that I gave on the general subject of bringing in what it is hoped will be more efficient and widespread laws to prevent restrictive trade practices. That was in reply to a question that Senator Sandford asked. 1 gave the answer in the Senate on 27th March.
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– Is the Minister in charge of the Commonwealth Scientific and’ Industrial Research Organization aware of the reported intention of the Victorian Government to endeavour to produce rain by artificial means? Can the Minister say whether the means proposed by the Victorian Government have been used successfully in the past? Has the Minister been approached officially about obtaining the aid of the C.S.I.R.O.? Irrespective of whether he has been approached, will the Minister give an assurance that the full facilities of the organization will be made available, if possible, to produce the rain that is vitally needed in Victoria?
– I was approached by the Premier of Victoria some time ago in my capacity of Minister in charge of the Commonwealth Scientific and Industrial Research Organization. He requested the organization to report on whether we could or should engage ourselves in an endeavour to create rain in certain areas of Victoria. We have examined the position as it stands at the moment. It became clear that the C.S.I.R.O. is now and for some time has been engaged in experiments in rainmaking in two specific areas in Australia. In neither of those areas have the experiments been completed. Uninterrupted measurements are required to be made after each experiment. Therefore, both experiments should continue uninterrupted, so that eventually sufficient data will be available for proper scientific conclusions to be drawn.
I informed the Premier of Victoria of those facts and also suggested that we would be willing, without interrupting our present activities or taking our aeroplanes off the experiments they are conducting, to give every assistance within our power. I suggested that his officers and C.S.I.R.O. officers should get together to see whether that could possibly be done. As a result of that meeting, his officers and mine reached an arrangement under which the State itself is chartering an aeroplane, and the organization is supplying the equipment that goes into the aeroplane to put out the silver iodide, the organization is supplying the silver iodide, and the organization is supplying the officer who knows how to use it and how to make reports on the experiment. I believe that answers the gist of the question asked by Senator Sandford.
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A wave of literary slush is sweeping Australia. It should be checked without qualm or delay.
Imported paperback novels with gaudy, sexy covers are enticing adolescents to the lurid pursuit of literature accenting vice, brutality, licentiousness and depravity.
These essays in violence and obscenity can be bought in Brisbane without the slightest trouble. The time for cracking down on them is long overdue.
Then the article gave a number of typical examples. If the matter contained in the article is correct, will the Minister inform the Senate what is being done to prevent the entry of such literature into this country?
– I have seen the article referred to by Senator Sir Walter Cooper. I read it with great interest. The powers of the Commonwealth in respect of the censorship of literature are limited to imported books and other printed material. The Literature Censorship Board examines them under section 22 of the regulations to determine whether they unduly emphasize sex, horror or violence or could lead to depravity. The board is constantly examining imported books. I think that the Senate will understand that individual copies of such books can come into the country in passengers’ baggage and other similar ways, and are not picked up readily by customs officers. But if books come into Australia in commercial quantities, the Department of Customs and Excise has ready access to the invoices and can take steps accordingly. In view of the large numbers of books coming into the Commonwealth, I would be the last one to say that a few objectionable books do not get under the tent. I have always said in this chamber that if any objectionable book comes to the notice of any honorable senator, I would appreciate its being brought to the notice of the department. If the book has slipped under the tent, we will take whatever steps we can to rectify the position.
– What about locallyproduced literature?
– The control of locallyproduced literature is in the hands of the State governments. In other words each State government is responsible for the control of books produced within its State boundaries. The States have full sovereign rights and the Commonwealth has no rights at all in respect of books produced in Australia.
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– I wish to direct a question without notice to the Minister for the Navy. Is it a fact that one of Her Majesty’s Australian ships on a recent visit to Hong Kong had to have the decks scraped down, and to do this work labour was engaged in Hong Kong? If so, was this work carried out by Chinese labourers, both men and women? If it were so done, what rates of pay were paid, and was the principle of equal pay for equal work adhered to? Why was it necessary to have this work done in Hong Kong when it could have been done just as easily and more efficiently in Australia by Australians, particularly having in mind that there is unemployment in Australia which, even on the conservative estimate of the Government, exceeds 112,000?
– This is a rather unspecific question - whether an unnamed ship had its decks scraped down.
– Well, I saw it on television.
– In that case, you should at least have noticed the name of the ship. It is not unusual - in fact it is common practice - for Her Majesty’s Australian ships that visit Hong Kong to have that sort of work done by local companies. As I do not know the name of the ship, it is a little difficult to know the details, but the work probably involved chipping off a bit of paint, putting on some red lead, and making normal running repairs and doing normal maintenance of that type. It is quite common for this type of work to be undertaken by local shipyards, which themselves employ labour that is not employed directly or paid directly by the Royal Australian Navy.
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– My question is directed to the Minister representing the Minister for Immigration. Having in mind the present disturbed state of parts of Africa and the probability that a good many Africans of European descent will be looking for security elsewhere, particularly for their children, are any new steps being taken by the Department of Immigration to obtain desirable migrants for Australia from those sources?
– British Europeans can enter Australia freely from South Africa. There is a general assisted-passage scheme under which British European migrants who apply to the Australian authorities can receive assistance to the extent of about £71 per person, and part thereof for each child, as South Africa is itself seeking immigrants, we have an agreement not to advertise in South Africa for migrants to Australia, but every possible help is given to those who express the desire to emigrate to Australia.
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– My question is addressed to the Leader of the Government in the Senate. Is the Commonwealth Government interested in and concerned about the decision of the Japanese Parliament to impose restrictions on the entry of Australian goods into Japan? I am particularly interested in hearing the Minister’s view on whether or not these restrictions will affect the coal trade to Japan, because only yesterday the New South Wales Minister for Mines and the Leader of the Government in the Senate announced plans for the development of harbours in New South Wales to develop an extensive coal trade. I ask the Minister particularly whether he thinks that the decision will affect the coal trade with Japan.
– I have heard nothing which would lead me to the conclusion that restrictions may be placed on coal imports into Japan. Senator Ormonde is closely in touch with the coal-mining industry, and there may be some information in this regard of which I have not heard. The matter is of such importance that, if the Senate does not mind, I shall take the precaution of asking that the question be placed on the notice-paper.
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– My question is directed to the Minister representing the Minister for Primary Industry. Is it a fact that the Committee of Inquiry into Wool Marketing omitted, as a body, to visit New Zealand and South Africa to take evidence on the marketing schemes operating in those two wool-growing countries? Is it not a fact that these two countries have for a number of years operated successful floor price woolmarketing schemes? Would the Minister comment on this significant omission?
– As far as I know the committee set up by this Government to inquire into wool marketing in Australia did not visit South Africa or New Zealand, where wool reserve-price selling has been in operation for some years with, I think it is fair comment to say, a general measure of satisfaction to the growers of those two countries. However, there is no significance in the suggested omission of the committee to take evidence in those countries. The committee had before it - as, indeed, has every growers’ organization in this country or any interested individual - sufficient documentation of the history of wool selling and a reserve-price plan in both of those countries to make a very careful analysis of the system and to form a considered judgment of its merits. The committee was under some pressure by this Government to complete its report as quickly as it could, and as Australia is by far the largest wool seller in the world, the committee in its wisdom thought it wise to proceed to the markets where our wool is finally disposed of. In that atmosphere the members of the committee decided that they would go to the United Kingdom and Europe and make a judgment for themselves of the effect that our selling methods could have on those countries. I suggest again that there was no significance at all in the committee’s not going to New Zealand to get first-hand information.
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– I wish to ask aquestion of the Minister representing the Minister for Labour and National Service. I direct the Minister’s attention to an extract from Mr. Justice Ashburner’s judgment of 26th October, 1961, adjusting the attendance money rate for waterside workers, in which His Honour said -
Since March, 19S6, the waterside workers’ hourly rate has increased from 7s. 10id. to lis. 7d., that is, 47 per cent., as compared with a rise in the Consumer Price Index of 17.5 per cent. In addition, he has been given payment for public holidays not worked, paid sick leave and long service leave.
Will the Minister be good enough to have a comparison made of that trend as against the trend in general industrial conditions as indicated by the award for engineers?
– I shall bring the question to the attention of the Minister for Labour and National Service so that he can see what would be involved in endeavouring to draw up a proper and accurate comparison of the rate of rise of wages of waterside workers and those who are paid under the engineers’ award. Both rises would, I imagine, be due to Arbitration Court action.
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– I wish to ask a question without notice of the Acting Minister for Trade. May I say by way of preface that in my mail to-day 1 received, with the compliments of the Australian Wheat Board, a copy of a statement by George W. Ball, Under-Secretary of the Department of State of the United States of America, in which there is a most provoking presentation of the attitude of the United States to the development of the European Economic Community. I direct attention to the following passage: -
We believe that one of the responsibilities of the European Economic Market is to ensure that common agricultural policy does not indeed impinge upon the legitimate interests of third countries which have traditionally supplied the European Economic Market with agricultural products.
I ask the Minister whether he can enlighten me about the particular interests in this statement of the Australian Wheat Board. Secondly, can he tell me whether this statement represents the official view of the United States Government. I ask the Minister, thirdly, whether the meaning of that statement is that the United States is joining with Australia with the object of maintaining access - not necessarily on preferential terms - for Australian agricultural products to the European Common Market.
-The question that the honorable senator asks is a very important one indeed. I ask him to place it on the notice-paper. I think that Mr. McEwen himself, who is at present attending meetings and taking part in discussions on this very interesting subject would be, on his return, the man to give him the full information that he now seeks.
page 724
asked the Minister representing the Minister for Immigration, upon notice -
– The Minister for Immigration has supplied the following answers: - 1., 2. and 5. The latest issue of the “ Australian Immigration Quarterly Statistical Bulletin “ does not include figures of long term and permanent departures. The purpose of the “ Bulletin “ is to provide detailed information directly related to the immigration programme, particularly statistics on the programme of assisted migration. Information on long term and permanent arrivals and departures is now published by the Commonwealth Statistician on a monthly basis. Far from the public being denied information on this aspect, there is more regular information being made available than previously.
page 725
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Paltridge) read a first time.
– When the Treasurer introduced the 1961-62 Budget, he estimated that the Commonwealth would have an overall cash deficit of £16,500,000 in the current financial year, and indicated that the Government would be seeking loan authority for the raising of treasury bills to finance that deficit. The purpose of this bill is to obtain loan authority to finance the probable cash deficit which will now of course be greater than that previously estimated because of the measures we have recently proposed.
It is, necessarily, somewhat difficult to estimate precisely what amount the cash deficit will prove to be. For one thing, if estimates of either revenues, or expenditures vary from the result by only about 1 per cent, the effect on that overall result could be of the order of £20,000,000. The Government proposes therefore, to provide against such uncertainties by seeking authority to borrow an amount which may prove to be somewhat more than is required to finance the deficit for the current financial year. Accordingly, in thisbill the authority of Parliament is sought to make a borrowing of £60,000,000 and to expend the proceeds of the borrowing.
It it proposed that the proceeds of the borrowing be applied to finance expenditure on Defence Services to the extent of £41,000,000 and to finance the redemption of maturing securities to the extent of £19,000,000. The maturing securities, redemptions of which are to be financed from the proceeds of the borrowing, are Commonwealth securities which were issued for war purposes.. The borrowing, therefore, is’ to be wholly for defence purposes of the Commonwealth.
Total expenditure on Defence Services in 1961-62 was estimated in the Budget at £202,900,000. Of this total estimated expenditure it is now proposed that an amount of £41,000,000 should be charged to the Loan Fund where it will be financed from funds raised under the authority of this bill. A similar procedure for charging defence expenditure to the Loan Fund was followed in 1958-59 and 1959-60 and in some of the war and early post-war years when total receipts were inadequate to meet total expenditures.
It is estimated that, in addition to utilizing the current receipts of the National Debt Sinking Fund, it will be necessary to call on the invested balances in that fund and in the Loan Consolidation and Investment Reserve to the extent of £19,000,000 to finance redemptions of Commonwealth securities issued for war purposes. The borrowing will enable this to be done by providing cash for the realization of some of the investments of these Funds. I commend the bill to honorable senators.
– The Minister for Civil Aviation (Senator Paltridge) has just indicated that the purpose of the bill is to raise a loan of £60,000,000. He reminded us that when the Treasurer (Mr. Harold Holt) introduced the Budget in August of last year he stated that loans would be necessary during the current financial year. The Treasurer had more to say about this particular loan - or more precisely, the deficit that was anticipated. Speaking in August last, he said in respect of certain commitments of the Commonwealth Government that were well known at that time -
In June last, the Loan Council approved for 1961-62 a governmental borrowing programme for State works and housing of £240,000,000, which is £10,000,000 greater than the 1960-61 programme. Subject to the normal conditions, the Commonwealth Government has undertaken to support the programme if necessary, from its own resources.
Again this year a large amount of debt will mature and we have to provide for heavy redemptions. At 30th June last, the loans falling due within Australia in 1961-62 totalled £290,700,000; in addition, a loan of U.S.$38,310,000 matures in New York next February.
That is, last February. The Treasurer continued -
Last year, redemptions in Australia and abroad were £79,095,000. In the circumstances of this year, redemptions are unlikely to be much less than last year and £79,000,000 is being included on that account amongst our commitments.
Then he dealt with loan raisings. I mention these things because in all probability they account for the use of treasury-bills in respect of this loan on this occasion. In respect of loan raisings, the Treasurer stated -
Last year cash proceeds of loan raisings in Australia and overseas amounted to £144,651,000. This year, with more stable financial conditions, we may be able to borrow rather greater sums in Australia.
– From what are you quoting?
– From the Budget speech of last year. As I stated, the Treasurer outlined the Government’s commitments during this financial year. As I shall point out later, he said that a deficit was expected. He stated -
We propose to use a figure of £165,000,000 for possible borrowings from all sources in 1961-62. This would be an increase of £20,349,000 over last year.
Dealing with the overall position, the Treasurer said -
If, as estimated, total cash expenditure in 1961-62 amounts to £1,935,169,000 and total cash receipts amount to £1,918,698,000, there will be s cash deficit for the year of £16,471,000.
So it is quite clear that the Treasurer was able to see at that stage that he faced a cash deficit of £16,000,000. Let us examine the amounts representing the difference between £16,471,000 and the sum that this bill proposes to raise.
Within recent weeks we have dealt with legislation relating to an income tax rebate that will involve the Government ‘ in forgoing revenue amounting to £25,000,000. Legislation relating to sales tax collections will result in a loss of revenue of £4,500,000. In respect of those two items, receipts will be down by £29,500,000. Legislation relating to the Commonwealth Development Bank will involve an expenditure of £5,000,000. Expenditure on Commonwealth works will be increased by £1,000,000 and grants to the States increased by £10,000,000. The increase in the unemployment benefit will cost at least £500,000 and additional expenditure on State housing programmes will amount to £7,500,000. These items total £24,000,000. So we really have this situation: There will be a loss of revenue of £29,500,000 and an increased expenditure of £24,000,000 as a result of specific legislation. The Government will have to find the sum mentioned in the bill, namely £60,000,000. I have nothing much to say against that. The Opposition will not speak or vote against the bill. The Government faces the situation wherein it will expend more money than it expected to expend when the Budget was introduced. It has greater commitments to face, and it will face them in the manner outlined by the Treasurer in his Budget speech last year, when referring to the expected cash deficit of £16,471,000.
In the press this week I noticed a statement reported to have been made by the Treasurer, I think in Tasmania, to the effect that the economy of the Commonwealth was improving. I have not any doubt about that; I do think that it is improving. An amount of £3,000,000 being made available to the State of Queensland, to be spent in the two or three months before 30th June, must necessarily improve the economy of Queensland. An amount of £3,000,000 cannot be just released into the financial and commercial channels of a State without some improvement being shown in the economy.
A feature of this bill is that the extra amount of £60,000,000 is to be found in the form of treasury-bills. The Minister’s second-reading speech stressed that the money is for defence purposes, but I know of my own knowledge that if a loan of £60,000,000, to be underwritten by treasury-bills, is raised, that sum cannot be earmarked specifically for defence purposes. The money, or the credit, is not identifiable. As soon as arrangements are made for establishing for the purpose a credit of £60,000,000, the money becomes available for general purposes, and in the course of expending it, the sum particularized here will be spent on defence. That is the whole situation.
Whether or not it is wise at this stage to spend money raised by loan, through the agency of treasury-bills, is left to the judgment of the Senate. It can be argued, of course, that this may have an inflationary effect upon the economy. That also remains to be seen. I recall that only a few years ago, a sum of over £23,000,000 was expended at St. Mary’s, right at the back door of Sydney. That would have had an inflationary effect upon that neighbourhood and upon Sydney itself. The amount involved in this bill will be dispersed to some extent throughout the Commonwealth. No doubt the Department of Supply will use some of it. I hope that it does, and that it confines its buying activities to Australian manufactured goods. One of the things to which I object is the establishment of a branch of the Department of Supply in the United Kingdom for the purpose of making purchases. It may be warranted; there may be commodities that the Department of Supply requires that are not obtainable or not manufactured in the Commonwealth, but I certainly would not encourage the establishment of branches of that department outside Australia. The Department of Supply purchased drums in the United Kingdom, although the best drums can be made in Brisbane and purchased at the same price. I mentioned a while ago what the Treasurer had to say about the improvement in the economy. The fact that extra housing money has been made available must have some effect on the timber industry. The period between nov and 30th June will be, so to speak, a testing period for the economy, but I feel sure that there will be an improvement.
As far as Queensland is concerned, from June onwards the seasonal industries will be in operation and the economy of the State should be in a sound condition. Sugar harvesting commences then. Recently an endeavour was made by the sugar mills of Queensland to increase their peaks. The mills do not seem to be discouraged by what is happening in Europe in relation to the Common Market. They would not have asked for an increase in their peaks unless they thought they had a reasonable chance of disposing of the sugar crop. They must think that they can negotiate contracts for the sale of additional sugar.
The meat industry in Queensland will certainly be in a flourishing condition this year, compared with the .last two years, because the’ State has enjoyed bountiful rains since last December. The important meat export trade has been operating for a month or two, and all meat, works will be operating full-scale from some time in May until November or December of this year. As we are dealing with a specific bill, I do not want to introduce extraneous matters unnecessarily, but, with the best of intentions, I do wish to make a suggestion to the Minister. The meat season will slacken off from November or December. Would it be possible for the Government to raise a small loan to tide the workers engaged in seasonal industries over the first few months of next year? If the Minister could arrange such a loan he would confer a blessing upon the whole of the State of Queensland.
According to my understanding, the money involved in this loan will go from the Reserve Bank to the Treasury. Treasurybills will be issued and the Commonwealth Government will be able to spend the money. That is all right in its way; it will do some good. A sum of £3,000,000 was made available to Queensland by way of a grant, but there are still a fair number of unemployed in the City of Brisbane alone. It is unfortunate that only one-third of Brisbane is sewered. If the Government could, in some way, negotiate directly with the Brisbane City Council and make a loan of £1,000,000, £2,000,000 or £3,000,000 available, there would be very little unemployment in Brisbane for at least twelve months. Of course, it may be impossible for the Government to negotiate a loan direct to the Brisbane City Council. The Opposition does not oppose this bill.
– The Opposition is not opposing the bill, and Senator Benn has been particularly benevolent in his remarks, so a lengthy speech is not called for. However, we ought always to know what we are doing. This loan, although called a loan for defence, and although specifically earmarked either for current defence expenditure or for paying off some maturing defence securities, is in fact being raised to cover the deficit that we all know will be incurred in this financial year. The precise amount, of course, ls not known. The deficit originally estimated was £16,500,000, but we can think of things which will increase it by recalling the bills we have passed during the last few days.’ For instance, we passed a bill to reduce sales tax. I think it is estimated that that will cost £4,500,000. We approved of some non-repayable grants to the States, estimated at about £10,000,000. Then we approved of an additional £5,000,000 as capital for the Development Bank. We agreed also to the grant of an extra £7,500,000 for State housing.
Everybody will admit that this is a time when deficit financing is justified. Unemployment at present is greater than it should be. Any degree of unemployment is too much, but at present there is considerable unemployment which should be reduced. The kind of expenditure for which this loan will be used will tend to reduce unemployment. For instance, some 75 per cent, of the money expended on defence is accounted for by salaries and wages or expenditure for goods. The money will give a necessary fillip to production.
Generally speaking, deficit budgeting is permissible at certain times, but not always. I think the controversy that goes on about it is often confused by lack of knowledge. Somebody will propose that money be released either by making further credit available from the Commonwealth Bank or by the issue of treasury-bills. Somebody else will oppose the proposal and there will be general argument as to whether such a course is desirable. Whether it is desirable or not depends entirely on circumstances, At least since Keynes - although even before Keynes there were people who looked into the problem - it is admitted that the creation of credit, as it is called, coming ultimately from government sources, is a very bad thing in a boom. It is a bad thing when there is tremendous pressure to buy goods and materials, but if there are unused materials and unemployed labour, the creation of credit will not necessarily cause inflation, but will simply tend to restore the economic balance. The equating of goods and services and money is the very essence of sound financing. Nobody need have any qualms about supporting this bill, and I do not think this is an occasion for any party cross-fire as to why we should be doing this at this particular time. The necessity to do it exists. The method being used is sound and we should use it.
I will say a word or two about defence, although this is not really a defence measure.
– Then why does the bill say the money will be used for defence?
– Because that is one item of necessary expenditure. I did not frame the bill, so I am afraid I cannot answer the honorable senator’s question. However, if there is a general deficit, wherever the money comes from it will tend to rectify that deficit. It is, as the honorable senator reminds me, definitely expressed in the bill that all this money is to be devoted to defence. We should all face the question of defence much more boldly than we have done in the past. When discussing another topic the other night I said that this country must be ready, if necessary, to spend more on defence. I justify that statement on two grounds. First, we live in a very unsafe world. Secondly, apart from the nightmare about a general conflagration that some people always have when the question of defence arises, there is the possibility of local conflagrations. There is the possibility that we shall need forces, in effect, to defend our own shores. We know of the factors that are bringing about that possibility - factors such as world communism which, as far as South-East Asia is concerned, is now activating China. Attempts are being made to set up other Communist States in SouthEast Asia. It may be necessary at some time in the not remote future to have effective mobile forces which can counter a threat coming from any quarter to the north of us.
We certainly have mobile forces; we also have effective and efficient forces, but I do not think we have enough. I believe that over the last few years reappraisal of our defence needs has been undertaken very carefully by the Ministers concerned. I believe, too, that there is a sound defence policy, but this Senate needs to be better informed about our defence requirements. We need not only the effective Navy we have, but also additions to it. We are getting them, of course. We need a more effective Air Force, and we need a mobile striking force. It has been estimated that we require at least a division which can be thrown in anywhere;, that is, a division of permanent soldiers.
This is something altogether beyond the thinking that governed defence legislation in the past. I can remember when the defence forces of Australia consisted of a few artillery men in the cities and the ports, and volunteers. There were no regular infantry soldiers at all. After the First World War there was a period in which our defences fell completely into disrepair. The military college was closed and compulsory training which up to that time had been virtually the only effective means of recruiting a fighting force, was abolished. The Second World War forced us to face the facts, but immediately afterwards the slack set in again and the tendency was to spend as little as possible on defence.
We are not going to get our way in the world and our voice will not be listened to in international disputes if we are not playing our part. It is true that at the present time we are dependent mainly on the strength of one or two great powers, notably the United Kingdom and the United States of America; I should say, most of all, the United States of America. That is a fact of the present day which cannot be ignored whether we like it or not. We are not spending on defence an amount proportionate to the expenditures of those countries, and that poses a question which can be asked and has been asked whenever we raise our voice at international gatherings. I am not saying that mere proportional spending is a proof that you are doing all you ought to do. Expenditure can be wasted, but our defence expenditure is a measure which other nations will look at. For that reason I think that expenditure on defence cannot be reduced in the present condition of the world. I say quite definitely that it should be increased. On all grounds, Sir, I say that this bill, whether it is merely a legislative measure to cover a financial situation, whether it is a measure for the relief of unemployement, or whether it is solely a defence measure, is justified and has my full support.
.- In presenting the 1961-62 Budget, the Treasurer (Mr. Harold Holt) stated that it was estimated that the deficit for the year would be approximately £16,500,000. Events which have occurred since then seem to indicate that the deficit may be more than that. I think the Treasurer himself believes that to be so, and because of his belief he has asked the Parliament to approve of. a loan of £60,000,000. I hope that the loan which is envisaged by the bill before us will help to improve the employment situation and at the same time reduce our deficit. So far as the Treasury is concerned, every man and woman who is returned to employment represents a good business proposition. Because of the number of men and women who are being rapidly re-employed, I am hopeful that our deficit will not be as great as it was expected to be.
Of the £60,000,000 that it is proposed to borrow under this bill, £41,000,000 will be applied to financing expenditure on defence services. The borrowing of this money will not add one penny to the estimated total expenditure on our defence forces as shown in the Budget, nor will it subtract one penny from that amount. As honorable senators will remember, the details of proposed defence expenditure were outlined in the Budget.
The remaining £19,000,000 of the proposed loan of £60,000,000 will be used to redeem maturing securities which were issued for war purposes. I am of the opinion that our war debts must be reduced as quickly as possible. There is no doubt that the debts which this country contracted during the war gave us our freedom, but it cannot be said that they have any productive role in our economy. That is one of the reasons why I believe that the sooner we can redeem them the better it will be for our economic situation.
The total expenditure on Defence Services in 1961-62 was estimated in the Budget at £202,900,000. Of that total amount it is now proposed that £41,000,000 should be charged to the Loan Fund, where it will be financed from funds raised under the authority of this bill. As has been said previously, in recent months the Government has brought forward certain proposals of an economic nature. They include the proposal to reduce income tax by a total amount of £25,000,000, nonrepayable grants of £10,000,000 to the States, the addition of £5,000,000 to the capital of the Commonwealth Development Bank, the provision of £7,500,000 for housing in the States, and the allocation of an additional £1,000,000 for Commonwealth works. We have to find a total additional amount of £53,500,000 until the end of June this year. I hope that the provision of this additional finance will step up production and help our economy. We know that private enterprise provides three out of every four jobs that are available in this country. Our population is increasing and so, too, is our work force. The Government has always endeavoured to maintain the highest level of employment possible. In my opinion, only one thing may limit our future development and that is production costs.
We know that during the last federal election campaign the Leader of the Australian Labour Party said that if his party were returned to office he would restore full employment within twelve months and would introduce in February of this year a supplementary budget for a deficit of at least £100,000,000. Of course this Government has had deficit budgets. It had one in 1958-59 and another in 1959-60. But in other years we have had large budget surpluses. Much as I would like to see Australia always live within its income, there are times, just as in one’s own private trading, when a deficit is justified. I believe that the present deficit, much as I regret it, is justified. At the present time we know that money is available for lending to private borrowers. We know that if that money is used it will increase employment in this country. In the future our population, and consequently our work force, will increase. It is the Government’s duty to ensure that every member of the work force is usefully and profitably employed. We have liquid funds and resources. Prices and costs have been reasonably stable during the last twelve months.
My support of this bill is qualified by the desire that internal costs in Australia will not rise. But, because in essence the bill seeks to put men and women into employment as quickly as possible, I support it and hope that it will have a successful and speedy passage.
Question resolved in the affirmative.
Bill read a second time.
In committee:
The bill:
– This measure comes to me without an opportunity to examine it. Therefore, I would be obliged if the Minister for Civil Aviation (Senator Paltridge) would explain why clause 4 of the bill specifically attaches this loan to the defence services. Is not the true substance and effect of this bill to authorize borrowing to finance the Burget deficit generally? If that is so, why is. this loan attached directly to defence services? The bill, to my mind at present, wears the apparel - I hope this impression will be dispelled - of camouflage. Am I wrong in assuming that defence expenditure usually is regarded as one item to be charged to revenue, because if you put down £20,000,000 in a capital ship, that is an expendable unit and is not in the same category as commercial capital?
I also ask the Minister to enlighten me on the second aspect of clause 4. In what way will the Budget deficit be financed qua the £19,000,000 which is to be applied to the paying off, repurchasing’ or redeeming of Commonwealth securities issued for war purposes? What are those securities? Are they treasury-bills or are they fixed securities? If the £19,000,000 is to be applied to paying off, repurchasing or redeeming Commonwealth securities issued for war purposes, how is it related to financing the current deficit?
– The two matters raised by Senator Wright are1 interesting. He has asked why the amount of £60,000,000 which will be devoted to the financing of general government activities, should be appropriated for defence purposes. That is a practice, as is mentioned in the second-reading speech, that has been adopted twice in recent years. The practice was adopted in the latter years of the last war and in the early post-war years. The adoption of this practice makes it unnecessary for the Commonwealth to obtain Loan Council approval for the borrowing. The honorable senator will appreciate that borrowing for defence purposes does not require Loan Council approval. Having said that, I hasten to say that the adoption of this practice is in no tense a camouflage. The States realize that Commonwealth funds generally, as raised during the year, will go to support their loan programmes. There is nothing in the nature of camouflage, nothing in the nature of a departure from a practice that has become usual in these circumstances in recent years.
– Is that not merely an evasion of the Financial Agreement?
– A practice that has evolved over the years and which is pursued with benefit to the States obviously would have the approval of the States. In this case the raising of money will assist the financing of State loan programmes.
– It is the Financial Agreement, is it not, that requires Loan Council approval for Commonwealth loans except defence loans?
– I think it is the Financial Agreement of 1928. I rather think there is a constitutional requirement also, although I am not sure. In any event, the Financial Agreement of 1928 provides that raisings for defence purposes may be made by the Commonwealth without the approval of the Loan Council. That procedure has been adopted in respect of the raising covered by this bill in order to meet the convenience of a situation that could not otherwise readily be met. I repeat that it is a practice that has been adopted twice in recent years and also in the early post-war period.
Senator Wright referred to the £19,000,000 that will be used for the redemption of war debt. Far and away the bulk of Commonwealth debt is war debt. The book-keeping of this operation, as I understand it, is that £19,000,000 of war debts will be redeemed and that treasurybills will be issued to provide the £19,000,000, which goes into general funds for expenditure. I suggest that that is a sound practice. The Commonwealth has a War debt unsupported by assets - a fact that was adverted to by Senator Wright when he asked the question - and with no capacity for producing revenue. It is wholly justifiable, and indeed desirable, that £19,000,000 of a Commonwealth debt of that nature should be redeemed as the opportunity .to do so offers.
– Just as a matter of interest, I seek information from the Minister. I remind him that on Wednesday last an honorable member on the Government side of another place gave a list of figures showing the relative expenditures on defence over a period of about fifteen years. These were embodied in “ Hansard “. From listening to supporters of the Government, I always had the impression that this Government was very much more interested in spending money on defence than other governments had been. The figures to which I refer show that approximately £200,000,000 a year was spent fifteen years ago and is spent to-day. That, of course, represents a fall in terms of purchasing power or the value of money. The implication in the statement made in another place was that the Government is spending on defence only about half the amount of money that used to be spent, in terms of purchasing power. Will the Minister make some comment on that? I would be interested to hear his answer.
– I think the honorable senator will agree that the proposition on which I am asked to comment is rather vague. The truth of the matter is that for some years past the Government has spent in the vicinity of £200,000,000 a year on defence. I rely on my memory when I say that the estimate for this year’s expenditure is £202,900,000. For some years before this year the expenditure was £190,000,000, and prior to that it was £180,000,000 for a short period. If the honorable senator studies the allocations that have been made over the years for defence expenditure, I believe he will find that when this Government assumed office there was a sharp up-turn in defence allocations. That up-turn was accentuated by the Korean War in 1951 and 1952; then there was a slight falling away until we adopted £180,000,000 as the pattern for a year or two; then the allocation went to £190,000,000, and then to £200,000,000; and this year, if my memory is right, the expenditure will be nearly £203,000,000.
.- Having considered the Minister’s explanation of the raising of these moneys for defence purposes, I rise to express my disquiet about the procedure. I realize that my voice is probably a lone one. Nevertheless, even if in vain, I shall persevere. As I understand the situation, the Australian Loan Council, consisting of representatives of the responsible governments of the States and the Commonwealth, has been created to regulate and control loan raisings. One exception is made which is paramount by reason of its special nature, namely, defence, in which no federal government would permit its authority to be subordinate to a majority of the States. It seems to me that that paramount case, in which a federal government has a right to borrow unrestricted by the Loan Council, should be reserved for actual defence purposes.
I see in this bill simply an ear-marking of £41,000,000 of the general budget deficit and putting on it the label Defence Services in order to by-pass the Financial Agreement. If I am not correct in that divining of the substance of this bill, I hope that an honorable senator will inform me where the error is.
I am not impressed in the slightest degree, Mr. Temporary Chairman, by the reference that the Minister made to the fact that this procedure was followed on one occasion in recent years, if the Government intends to regard it as a precedent to be followed. On the contrary, reference to the possibility that this procedure is growing into a practice increases my anxiety. I believe that we ought to be very watchful indeed.
I rose simply to put on record this word of warning. I remain unconvinced at the present time of the propriety of this procedure. If on any subsequent occasion I am given an opportunity to consider a similar bill before it is put through the Senate - on this occasion the bill was introduced only one hour ago - and if I remain of the opinion that the bill represents an improper use of the exceptional provision in the Financial Agreement, I will feel bound to take some step to try to persuade the Senate to put a stop to the practice.
– I have explained to the honorable senator, I think he will agree, without any attempt to be other than completely frank-
-I do agree.
– I have explained why this practice has been adopted now, as it was on two recent occasions and on occasions immediately after and during the Second World War. I do not seek to present this practice as a precedent. I seek merely to explain its use on this occasion, as on the other two recent occasions, as a practice that has been followed to meet the unusual and special circumstances of the particular time, but not as a precedent. I hasten to say to the committee that if, in the view of Senator Wright, the Financial Agreement has been by-passed, it has not been by-passed in the sense that the State members of the Australian Loan Council disapprove of the practice. They recognize that this action is taken to meet their convenience at this time.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
page 732
Debate resumed from 29th March (vide page 695), on motion by Senator Paltridge -
That the bill be now read a second time.
, - This bill is brief and, on the surface, simple, but it is important that the Opposition should make its attitude quite clear. Basically we do not oppose the measure. It does in some small way confer financial benefits on the States, allegedly in accordance with the disabilities that they had suffered under successive Menzies governments. However, we do condemn the Government for the paltry, miserable miserly and parsimonious attitude that it has adopted, especially when one appreciates the magnitude of the task that is faced by the people of Australia to-day, particularly those who are totally unemployed and those who are doing part-time work. The States are crying out for development and for the finance necessary for essential development works.
The very introduction of this bill suggests almost political indecency on the part of the Government. A few months ago various senior members of the Government, not only in Parliament but also at various meetings through the length and breadth of this country, assured the people of Australia that everything was all right, and that representatives of the Labour Party and of industry, both primary and secondary, were crying wolf, and crying it too often. A few weeks after the election a statement emanated from no less a personage than the Prime Minister (Mr. Menzies) himself, that the Government was concerned with the increase in unemployment and the menace of decreased confidence throughout the community. Yet he must have been astute enough to visualize that there would be not such a tremendous increase in unemployment. Tragic as it was for those who were thrown on the unemployment scrap-heap, this number had increased from 113,000 to 131,000. All of a sudden, through luck and various factors that have been described in some measure of detail both in this place and in the other chamber, the tide of unemployment began to recede. The Prime Minister saw fit to make a public announcement and his Government introduced a bill to make special grants to the States. Admittedly certain other measures were adopted, including a decrease in income tax, more money for housing, and the granting of permission to local authorities to raise loans. Incidentally, many local government bodies find it impossible to raise the loans that they have been permitted to raise. Some of them have been offered loans at rates of interest which they cannot in decency accept.
Why was this bill introduced? Who was responsible for the necessity to increase employment and to endeavour to boost confidence in the business and the spending communities? None other than the very Government which has introduced the bill - or its predecessor in office. It is proposed that the following amounts shall be distributed to the States: £2,240,000 to New South Wales; £1,800,000 to Victoria; £3,340,000 to Queensland; £970,000 to South Australia; £660,000 to Western Australia; and £990,000 to Tasmania. Let us take the Slate of Queensland as a concrete example of the consistency of the previous Menzies Government and its constituent parts - its members. Not only did the Prime Minister go to Queensland and attempt to reassure Queenslanders that everything was all right, but also did the Deputy Prime Minister (Mr. McEwen), the Minister for National Development (Senator Spooner), and the Treasurer (Mr. Harold Holt). They sought to convey that Queenslanders were either confused or were squealers. Now, out of £10,000,000 a sum of £3,340,000 is to be granted to Queensland, not by way of loan but as a direct gift or grant. As the Government had to reshape its policy so soon after the election, and in view of the extraordinary way in which it is in control of the treasury bench and the narrowness of its majority, it should in political decency give some serious consideration to going to the people again and facing the electors. If the Government is satisfied that its course of action is clear-sighted, if it is confident that it has the goodwill of the people and if it satisfied that it is carrying on governmental machinery efficiently, it should not hesitate; it should be certain that it would get a mandate from the people and be given a greater majority.
Under this bill £10,000,000 is to be made available to the States. It has been mentioned that in extra loans, concessions in taxation and extra housing money, the total assistance granted will amount to £53,500,000. Let us concede that this is no small amount. However, when one thinks in terms of the Government being in control of the spending of approximately £2,000,000,000 per annum and realizes that the national income amounts to approximately £7,000,000,000 per annum, one sees that the amount involved in the Government’s current concessions and grants is not large. The bill shows that something tangible is being done, and that is why the Opposition does not oppose it. However, the people are looking for a permanent solution to their problems. They do not want temporary expedients. Local authorities do not want to commence tasks that they cannot finish. The States do not want to embark upon development projects that they cannot complete, yet the Government has not made one statement of how it proposes to act after this £10,000,000 has been spent and the full effect of its expenditure has been experienced. By no stretch of the imagination can the Government claim that it has engendered confidence in the business community or that it has oiled the wheels of industry. A large percentage of industry is still working to only 70 per cent, of capacity. What has been the decrease in unemployment? The number of unemployed has gone down from about 131,000 to 112,000 and it will probably go down somewhat more in the next few months. However, it will not be reduced to the point at which there is no unemployment or at which there will be only temporary unemployment as people change from industry to industry. The Opposition is sensible enough to realize that seasonal workers will not have 52 weeks’ work a year. We do say that there is an irreducible minimum of unemployed-
– What percentage or number are you thinking of?
– We are thinking in terms of those necessary to meet the needs of seasonal industries with the minimum of unemployment during the slack seasons. A survey could be easily made. If you were prepared to do some work you could find the information. If the figure is not available to you, ask the Commonwealth Statistician to embark, with the authority of the Government, on a survey of the requirements of industry.
– You have answered my question!
– You will not trap me. The figures are governed by a variety of factors including changing circumstances and increasing mechanization. I have told you where to conduct your own investigation. It will be to your own benefit to do so. There is nothing like exercise to stimulate and improve the mind.
The Government is adopting measures of expediency. It has assisted some. It has helped the States in some measure, although many of the Premiers - notably the Premier of Victoria - are not particularly satisfied. He was more than caustic - he was condemnatory. These problems are still with us. When a bill such as this comes before the chamber the Minister in charge has a responsibility to say whether it is a fore runner of. similar measures of assistance or is to be the last grant of a specific nature. No intimation of this kind has been given by the Minister. Unemployment is still present and the Government offers no solace - no words of comfort - to those at present unemployed. Some may have the expectation of working in seasonal industries. In my own State the killing season for the meatworks will soon commence and in July the sugar season will begin. For an indefinite! period a number of those at present unemployed will be absorbed. The number of unemployed - recently 31,000 and now 27,000 - may be reduced in the next release of figures by the Department of Labour and National Service to 25,000 and thereafter to 13,000 or 14,000. But those 13,000 or 14,000 persons have no future.
The Bureau of Census and Statistics, under the direction of the Commonwealth Statistician, is conducting in all States what is known as a work task force survey. It selects some individuals in some homes, trying to get a reasonable cross-section of the community, and at intervals officers visit these people to find out whether, since the preceding visit, they have received fulltime employment, whether they have had part-time employment, or whether they are still unemployed. Though the survey has been going on for a long time no figures have been released. The investigation has revealed that a large percentage of those covered in the survey can now be regarded as permanently unemployed. The Government, apparently, is not concerned, or is incompetent to handle the problem.
I do not hear men engaged in secondary industries praising the solution offered to their problems. In fact, there is no real solution coming from the Government. It has talked of controlling imports. The Government had its own methods but found they were a real menace to overseas balances and to Australian industry. Credit restrictions affected only some industries and had no vital effect on the big importers. Recently the Government announced its intention to adopt a new policy in order to provide employment, but Australian industry is not satisfied with that, because the record of the Government in relation to import restrictions engenders no feelings of confidence or security. Grants are to be made to stimulate employment, but as Senator
Mattner said, private enterprise has to provide three out of every four jobs throughout Australia. All manufacturers engaged in secondary industry have no confidence because for twelve months the Government has shilly-shallied. Since 1951, with the exception of 1961, there has not been one year in which the Government has not interfered with imports one way or the other.
There can be no confidence in industry until the Government is prepared to give some assurance to Australian industry, perhaps by way of definite protection, with a corresponding demand for a measure of relative efficiency, that its policy will remain constant. Unless that is done there cannot be confidence in any industry or fulltime employment. As every one here knows, secondary industry is not primary industry. Irrespective of the fact that our standard of living depends, by and large, on primary production, this production cannot take up the lag in employment, nor can it provide opportunities for work for the young and old in the community. So there is an urgent need for a government with any sense of responsibility to give an assurance that its policy with respect to the problems of those engaged in secondary industry will remain constant.
I would not know what contribution the Government thinks the sum of £10,000,000 expended throughout the whole of Australia will make to effective national development. Again I say, this bill is a measure of expediency. No major project could be embarked upon with that limited amount of money. It is not substantial enough to justify real expansion, irrespective of which government department is involved. Let us take, for example, the question of education. To-day, the establishment of the average high school costs in the vicinity of £150,000 or £200,000. The sum of £10,000,000 would meet the cost of the construction of only 50 high schools throughout Australia. The same argument could be adduced in the field of hospital construction and health services. This sum of money will go nowhere towards meeting the costs of major projects associated with increase in primary production. Take, for example, the projects that could be developed to this end. Officers of the
Commonwealth Scientific and Industrial Research Organization, recognized experts in their particular fields, have said that primary production can be increased if there is a measure of government assistance.
Apart from this paltry amount, what measures of assistance have been offered by the Government up to the present time? Just recently the Government increased the amount available to the Commonwealth Development Bank by £5,000,000, making a total amount of £25,000,000 available for the institution. In a country such as ours it should have a minimum of £250,000,000 to meet the financial requirements of primary industry. The soil potentiality of the Fitzroy basin in central Queensland is known, as is the contribution that it can make to increasing productivity in the pastoral industry. Water is available there. Sites have been determined on the Nogoa, Dawson and Fitzroy rivers for four dams which could be constructed at no great expense and provide water with major irrigation possibilities.
The Government goes before the people and says that it is now satisfied that it has handled the problems. These are problems of its own creation, the problem of a stagnant economy and the problem of mass unemployment. It has handled these problems by making this amount of money available to the States. The phase of providing employment for a comparatively small number of people is a passing one. Those persons who are employed, as a result, on governmental work, may expect retrenchment as soon as this amount of money is expended, unless the Government, in the course of this debate, makes known its intentions for the future. A sum of money has been made available for housing. The Minister for National Development takes great pride, he claims, in the efficient discharge of his responsibility for housing.
– Hear, hear!
– He has not done a bad job.
– He has done a splendid job.
– He has done a better job than have most other Minsiters, but not as good a job as Labour would have done in that field of endeavour. When 100,000 houses were erected in a year, there was a panic on the other side of the chamber. A figure of 80,000 was regarded as the rightful number to meet the needs of the community. What was the result? There are still many people demanding decent accommodation and overpaying for it. The timber industry is stagnant. In north Queensland, mills are working only to 50 per cent, capacity. One of the biggest plywood enterprises in Australia has gone altogether out of plywood production and is confining itself to the production of veneers. That is the result of the endeavours - the inefficient endeavours, if I may say so - of the Government through the months and years.
I have heard it said by one representative that the provision of this amount of money will assist the education departments of the various States. Another said that it would help departments of agriculture and stock to provide facilities of a general nature, including water. In fact, we have been told that this money will assist every department in every State If it does that, only a comparatively trivial contribution will be made to any one department. For that reason the Government should be condemned. Local authorities are squealing, I think justifiably, that they have had a raw deal under successive Menzies governments. They have been told now that they may raise a certain amount of money by way of loan. Some of the major local authorities have been successful, but some of the minor ones, which exist to meet the needs of rural communities, either cannot raise the necessary finance or are not prepared to pay the high rate of interest demanded by lenders and permitted by a callous and irresponsible government.
The bill involves the distribution of £10,000,000, in the form of special grants, by a government that not so long ago said that everything was lovely, and that Labour was completely irresponsible and financially incompetent. I nearly said, “ fanatically desirous of placing first the interests of Australia and its people”, but I thought that that might seem offensive to Government supporters, many of whom, I think, do endeavour sincerely to carry out their task, but all that they succeed in doing is to carry it out incompetently. We would be completely irresponsible if we opposed the bill, but it is pur duty to point out to the people that there are deficiencies in it. One is that the amount to be provided is comparatively paltry. Another is that there is no suggestion of a constancy of approach, either to the problems of States or to the problems of primary and secondary industry. The Government should be seised of a sense of responsibility and a realization that the problems that the nation is now facing are the creation of successive Menzies governments. Until it appreciated that, a solution cannot be found. That is why the Government stands condemned. The States accept the grants, but not gladly. As with the widow’s mite, anything is to be appreciated.
Knowing the ability of the man who introduced this bill, though he has not Cabinet responsibility for it, I hope that he will go away and give serious consideration to the responsibilities of his Government, the desires and the needs of the people in the various States and the needs of the country for development, settlement and expansion, and that through the Prime Minister there will be, comparatively soon, an announcement regarding the future of the Australian people in relation to employment, and the future of Australian industry, particularly secondary industry, and a recognition of the rights and responsibilities of the various States in relation to development.
.- I really believe that no matter what this Government brought forward and what benefit it conferred on the Commonwealth, it would receive the greatest recriminations from Senator Dittmer. I take note of the fact that he was very vague in relation to a reasonable number of persons to be registered for employment. He could not. be pinned down to a figure.; He would.. net. even say whether or not he agreed , with Mr. Monk.
– You wanted me to agree that it should be 65,000, but I do not.
– When he talks about these things, he should be prepared to come down to some specific figure. Mr. Monk said that unemployment did not commence until after the figure of 1.5 per cent, had been reached.
– For the purposes of argument, accept that figure.
– If you accept that figure, in the Commonwealth to-day we have a register of approximately 1 per cent, of unemployment. It must be conceded that the measure we are debating is only one of many measures brought down by the Government to correct the position that has existed for the past six months or more. It must be conceded also that measures were taken prior to the last election. I call to mind that the last Budget provided for decreases in sales tax on certain items, to try to boost sales of those items. Increased money was voted for housing. It was said during the election campaign that if those measures did not suffice further action would be taken. This measure is a part of the further action.
It will be noted that under the bill the States of Tasmania and Queensland will, on a pro rata basis, receive more than any other State receives. This is because they have had a greater percentage of unemployment and also, no doubt, because some of the other measures brought down by the Government to try to correct the position do not confer as much benefit on Tasmania and Queensland as on some other States. Although Senator Dittmer is so critical of the amounts that have been provided, it is sometimes a great refuge to me to be able to cite Mr. Reece. At the time it was announced that Tasmania would receive £990,000 out of the £10,000,000, Mr. Reece did not hesitate a moment in saying, and in having publicized in headlines in the Tasmanian press, that he was eminently satisfied. Those are the words that he used. He said that he was eminently satisfied with the treatment the State received at the hands of the Commonwealth Government. Mr. Reece, for some reason or other - no doubt because he is in a responsible position - made that statement. It must be conceded that although the Commonwealth Government has a great deal of influence on the economy of Australia, the State governments themselves are not without influence. I suppose that Mr. Reece, like most human beings, has his lucid moments. He recently made a statement which was not in conformity with what has been said by members of the Opposition. Speaking of the economic position in Tasmania, Mr. Reece was reported as follows: - . . the February figures for registration for employment showed the highest percentage reduction in unemployment of any State in the Commonwealth.
Furthermore, he had strong reason to believe that this position would show a further marked improvement when the returns for March became available.
He went on, and was reported in two columns of eight inches each. He advanced reasons for thinking that the economy of Tasmania, and of the whole Commonwealth, will improve in the near future. Apparently he does not seem to be actuated by the same motives as the Opposition. He does not desire to make political capital out of any recession. After enumerating his reasons, he finished by saying -
Why he called it a scare, I do not know. If the people were scared, they were scared by the Opposition - in a solid and constructive manner.
I repeat that the observation of the Premier of Tasmania is a direct contradiction of what we have heard from Senator Dittmer and other members of the Opposition.
– That does not make me wrong on an Australia-wide basis.
– It is not the first time that Mr. Reece has been out of step with the Opposition. I recall the occasion when he castigated the Opposition in this Senate - his remarks were featured in headlines in the Tasmanian press - for voting against something that he said would usher in a new economic era for Tasmania. He did not hesitate for a moment, in the Tasmanian House of Assembly, to castigate the Opposition in this place for voting against what he considered to be a great step forward. Mr. Reece has been proved to be correct. The production at Bell Bay is in the process of being trebled.
However, be that as it may, Senator Dittmer said again and again that the position which this bill seeks to rectify was brought about by measures for which the Commonwealth Government was responsible. Senator Dittmer said that the Commonwealth Government had caused the trouble and therefore it was up to that
Government to do something about curing the trouble. I should like to refer to a comment on the economy of this country by the National Bank of Australasia Limited. In its “Monthly Summary” the bank said -
A favourable trade balance for the eight months to February of nearly £130,000,000, and overseas reserves at the end of that month almost certainly in excess of £600,000,000 against only £374,000,000 in February 1961, should remove any doubts as to whether the external risk might impede full recovery.
The writer heads the chapter in which that extract appears, “ Way Cleared for Action “. The article concludes -
Nothing is to be gained by the perpetuation of criticism of past events and policies-
This is what the Opposition is always trying to do - or of a timorous attitude towards the future.
Let me remind the Senate that the balance of trade position was only one of the things that the Government set out to remedy by the economic measures which have been the subject of so much criticism. As I have said previously, Australia must trade in the world and must pay its way. If it fails to do so over a long enough term, the repercussions will be very much more serious than the effects of the medicine that the Commonwealth Government was compelled to administer to the country’s economy.
Because of the medicine administered by the Commonwealth Government we have achieved a reasonable degree of stability. This is indicated by the oversubscription, by £35,700,000, of the recent £55,000,000 loan. I have here a newspaper report. I do not know how true it is. Some people do not take a lot of notice of newspaper commentaries, especially Senator Dittmer, although it was a “ Sydney Morning Herald “ commentary that aroused his ire. The newspaper says that the over-subscription of the recent Commonwealth loan has brought a fresh outlook to the Commonwealth Government’s budgetary position, and that the deficit will not be nearly as great as was anticipated, simply because it will not be necessary for the Commonwealth to underwrite State loans to nearly the same extent as would have been the case had this loan not been over-subscribed.
I rose mainly to say that I appreciate that this is an emergency measure. Its object is to get the unemployed back to work as quickly as possible. Mr. Reece says that the position is hopeful and I agree with him.
– Is he the only one who says that?
– He is one of the past federal presidents of the Labour Party. He is a man who has been reared in, and has spent his political life in, the Labour movement. He is a rabid Labour man. The difference between him and the Labour Opposition here is that he is in a position of some responsibility. The full effects of these measures have not yet been felt. When they are felt, I have no doubt that a greater degree of recovery will be experienced by the economy. I appreciate that these measures are emergency measures. The idea is to inject extra credit into the economy as quickly as possible, so that as many unemployed people as possible can be got back to work, but I do suggest to the Government that in future it should have some definite target in view.
– Now you are coming on to my side. Come over here.
– That is about the worst compliment I have ever been paid. Should it be reasonably practicable, I hope that in the future if the Commonwealth Government expends money in this way some of it will be used for the provision of sealed roads in rural areas. In that way a very definite and lasting benefit would be given, particularly to rural people. I cannot help thinking that the bull-headed adherence of the Tasmanian Government to the practice of sealing roads under the day labour system has deprived the people of Tasmania of many miles of sealed roads.
– Mr. Reece is wrong now, is he?
The ACTING DEPUTY PRESIDENT (Senator Wood).- Order!
– Yes, I disagree entirely with Mr. Reece in that respect. Should the need for quick, effective action such as this again be necessary, I hope the Commonwealth Government will consider the necessity to have an objective for the expenditure. Frankly, I have lost a lot of faith in the ability of the Government of Tasmania to achieve practical objectives, particularly on behalf of the rural people of that State.
– The people of Tasmania have lost faith in your Government.
– If the honorable senator were a primary producer and saw the abandonment of the free veterinary scheme, the curtailment of concessions on the carriage of lime to primary-producing areas, and a lot of other things that are going on, he would come to the conclusion that the State Government, as well as the Commonwealth Government, must accept some degree of responsibility for the economic conditions prevailing in the country.
– You are always telling the farmers in Tasmania that they do not want government assistance.
The ACTING DEPUTY PRESIDENT.-
Order!
– You say that they are private enterprises and do not want assistance or advice.
– I would answer that interjection, Sir, if I could understand it.
– You know what I mean. Only the other night you were talking to the farmers about not taking assistance.
The ACTING DEPUTY PRESIDENT. -
Order!
– I heard an honorable senator from the other side of the chamber advocate prices control. He said that the people had themselves to thank because they had thrown out Mr. Chifley’s Government and its policy of prices control. When the referendum on the subject of prices control was held, the High Court of Australia had not stated that the Commonwealth Government could not operate prices control. Mr. Chifley refused to operate it in a fit of pique. But, of course, prices control never cured anything. It accentuated the disease because it dealt with, or attempted to deal with, an effect and did not get down to the root cause of the trouble, and it never will do so. I support the bill.
Senator SCOTT (Western Australia) yesterday morning’s newspapers I read of criticism that had been voiced by the Leader of the Opposition (Mr. Calwell) because, it was said, the Parliament would go into recess early this month, thus not giving the Opposition a chance to debate legislation. Yet, we have in the Senate to-day a situation in which Government supporters have been rising one after the other to speak on the bill before the chamber. What is the matter with honorable senators opposite? Now they are interjecting loudly-
The ACTING DEPUTY PRESIDENT. - Order! Senator Scott will resume his seat for a moment. We must have order in the Senate, and while I am in the chair order will prevail. My call for order must be observed. Senator Scott may proceed.
– Thank you for the protection you have given me, Sir. When I made my earlier comment, I was getting in a little early, because I know full well that when the Parliament rises for the Easter period, the newspapers will say that the Australian Labour Party has not had an opportunity to discuss adequately bills brought forward by the Government. Yet, what is the position that we see here to-day? There has been one Labour speaker during this debate. He has spoken about Queensland and has said nothing of importance. Apparently, he had not studied the bill at all. He has been followed by two Government supporters, and I understand that other Government supporters also will speak.
Despite that fact, I have no doubt that, in a fortnight’s time, to the disgrace of the Labour Party, the newspapers will say that that party did not have an opportunity to discuss measures introduced by the Government. I intend now-
– To talk a bit of sense for a change.
– Yes, to talk sense. When we look at this measure we find that, amongst other things-
– What is the measure? Do you know?
– Yes, it is a measure which proposes to make a special gift of £10,000,000 to the States, and your State, because it is administered by a Labour government, is to receive more of that amount than will States administered by Liberal governments. That is a factor that should be taken into account.
– Why is the money being given to our State?
– Because the Government of Tasmania cannot run the affairs of the State properly. If we look at the proposed allocations, we see that the State which is to receive the largest share of the money is Queensland. As we know, Queensland has had two years of drought. We know that last year the sugar mills closed down two to three months early-
– That is not correct.
– We know that is so. I did not say that you knew it. We also know, Mr. Acting Deputy President, that the killing works in Queensland closed down a month or two earlier than usual because of drought conditions. The State is now enjoying a good season, but because of the drought conditions that it experienced previously, the unemployment figures are higher than they are in other States.
Let us consider the position of the States that are governed by Labour. The second largest share of the allocation, other than that for drought-stricken Queensland, will go to the Labour-governed States of New South Wales and Tasmania. In Western Australia and Victoria there are efficient Liberal-Country Party governments. Western Australia is to receive only £660,000 of this amount of £10,000,000, notwithstanding the fact that its population is nearly double that of Tasmania. I point out that Tasmania has had no droughts recently.
– Not much!
– You have had excellent seasons. Yet, that State, under a Labour government, is to be given a third as much again as Western Australia, although the population of Tasmania is only a little more than half that of Western Australia.
When a State is having a bad time, such as during a time of drought, the Commonwealth must come to its aid, as it is now going to the aid of Queensland. It seems that because some States, such as Tasmania and New South Wales, are badly administered by Labour governments, other States, like Western Australia, must suffer. I cannot see that that is fair.
Sitting suspended from 5.45 to 8 p.m.
– Prior to the suspension of the sitting I was informing the Senate how well-governed States deal with the problem of unemployment. I had reminded the Senate that Western Australia will receive far less on a per capita basis from the special grant of £10,000,000 than will the Labour-governed States of Tasmania and New South Wales. Those States are, in my view, badly governed. The £10,000,000 grant is in addition to the tax reimbursements to the States, which this year will amount to £292,000,000.
In 1959 the States and the Commonwealth agreed upon a formula for distribution of tax reimbursements. Prior to the agreement of 1959 the States received varying percentages of the tax reimbursements. Western Australia’s share was 12.1 per cent. At the Premiers’ Conference in 1959 it was decided to increase the percentages of several States so as to express those percentages in round figures. For instance, the share of tax reimbursements allotted to New South Wales was increased from 33.72 per cent, to 34 per cent. Similar action was taken with respect to the percentages allotted to Victoria, Queensland and South Australia. The percentages applying to Western Australia and Tasmania were reduced. If the same uplifting process had been adopted with respect to Western Australia, its share under the new formula would have been 13 per cent. But instead Western Australia’s share was reduced to 10.3 per cent, and Tasmania’s share was reduced to 4.5 per cent. South Australia agreed because of the highly industrial nature of the State, no longer to be a mendicant State, so it is no longer eligible for special assistance from the Commonwealth Grants Commission. The only mendicant States now are Western Australia and Tasmania.
In its report for 1961 the Commonwealth Grants Commission states that Western Australia will receive special grants totalling £6,156,000. I have reminded the Senate that Western Aus- 10.3 per cent, and not the 12* per cent, or 13 per cent, that it could have received under the old formula. The difference between 10.3 per cent, and 121 per cent, amounts to £6,424,000.
– Are you trying to prove that Western Australia is not getting a fair deal?
– I am not trying to prove it; I am proving it. Every other State has received an increased share of tax reimbursements under the new formula. Western Australia’s share has dropped from 12.18 per cent, to 10.3 per cent. If one has regard also to the special grant of £10,000,000, Western Australia’s share of tax reimbursements and grant amounts to 10.18 per cent, I claim - I would like the Minister for Civil Aviation (Senator Paltridge) to note this point - that, if Western Australia were to receive its rightful share of tax reimbursements, it would not need assistance from the Commonwealth Grants Commission. The same argument applies with regard to Tasmania.
– Do you not agree with the present formula?
– I am merely pointing out that under the old formula Western Australia was receiving 12.1 per cent and Tasmania was receiving 5.18 per cent.-
– Of what?
– Of tax reimbursements. Those reimbursements are made every year under a special formula. One cannot agree with the present formula-
– Why not?
– Because Western Australia’s percentage has been reduced by about 2 per cent. But, because it receives 2 per cent, less than formerly, Western Australia is entitled to receive special financial assistance from the Commonwealth Grants Commission. The same thing applies to Tasmania. All I am saying is that if the percentages received by Western Australia and Tasmania prior to 1959 had remained unaltered, those States would not now be classed as mendicant States. Under the old formula those States would be receiving more than they are now receiving by way of tax reimbursements and special grants.
Western Australia does not mind coming to the assistance of the other States. Western Australia is governed by an efficient government and undoubtedly is in a position to carry the other States. But Western Australia does not like being referred to by the other States as a mendicant State.
– It is you who have used the term.
– I do not want you to use it. The amount of money that has been available for distribution to the States by way of tax reimbursements has been steadily increasing. In the year ended 30th June, 1959, the amount distributed was about £225,000,000. In 1959-60, because of the new agreement, the amount was increased to £244,500,000. In 1960-61 the amount was increased to £269,900,000. For the year ended 30th June, 1962, the amount distributed among the States, including the £10,000,000 that we are discussing to-night, which is non-repayable, will be about £302,000,000. So, large amounts of money have been given by the Commonwealth to the States by way of tax reimbursements.
– That is all your money.
– I know that it is Commonwealth money raised by taxation. I am endeavouring to prove to honorable senators opposite that this Government has been quite liberal to the States in making tax reimbursements. I am amazed to hear members of the Opposition endeavour to lay the whole of the blame for the unemployment situation on the Federal Government when that Government is not really to blame in all cases.
I now wish to mention a few of the subjects that were referred to by the only speaker from the Australian Labour Party whom we have heard, Senator Dittmer. No doubt anxious for the Parliament to rise to enable its members to go home before Easter, the Opposition is not putting up many speakers. That will not stop members of the Opposition criticizing the Government if they get the chance to do so, and I do not blame them for that. Senator Dittmer said that this grant to the States would not allow them to finish any particular projects that they had in mind. I do not know that there is any such bar. He also stated that local authorities would not be allowed to spend the money because they ,—– not finish any jobs. However, the States know very well that each year for the six years for which the tax reinbursement agreement will operate, under the formula they will receive not less than £292,000,000 and next year they may receive £320,000,000. So, if the States - particularly Queensland and New South Wales which have the largest numbers of unemployed - want to use this £10,000,000, they can start a job with this money and finish it with other moneys as they come to hand. If they want to start road works or the building of a dam, I do not believe that there is any bar to their starting the job with this money and finishing it with their own money. So, Senator Dittmer’s criticism is not well founded.
– He just does not like you.
– He did not know that I intended to speak. We must realize that this money, if it is spent wisely, will be a great help in putting people back into employment. That is why the Government got away altogether from the formula. More money is being given to the States with large numbers of unemployed than to the States with smaller numbers. Consequently Queensland, which is the third largest State in Australia in terms of population, will receive the largest proportion of this grant because of its unemployment and the severe drought conditions that it has suffered over the last two years. We believe that this grant will help to get people back into employment.
One of the differences between the Australian Labour Party and the Government parties is that most of the Government’s measures are designed on a short-term basis. The Government has reduced income tax by 5 per cent. That reduction will inject about £25,000,000 into the Australian economy in the next three or four months. In the next Budget, that 5 per cent, rebate could be abolished. We believe that the unemployment problem in Australia is a temporary one and the Government is taking temporary steps that will overcome it. The Government really believes that private enterprise has a responsibility to employ many extra hands, too.
Taking as a basis an average wage of £20 a week, I estimate that this grant of £10,000,000 will provide employment for about 40,000 people. That, in itself, is a great step towards relieving the unemployment position. This is not the only step that the Government has taken. It is one step that we believe is necessary and will have the desired effect of reducing the unemployment. Since this Parliament met the number of people unemployed has been reduced by about 19,000- from 131,000 to 112,000. According to the latest figures that are available, that reduction has occurred in the last month. I firmly believe that that reduction will continue. When Senator Dittmer spoke about unemployment, I asked him to what figure he believed unemployment could be reduced.
– That is introducing politics into the matter.
– I am a politician and I have the right to answer what a previous Opposition speaker has said. Only one honorable senator opposite has had enough of what it takes to speak in this debate and I claim the right to answer him, although he has been answered effectively already by Senator Lillico. I am the second speaker from this side of the chamber, but I have only one honorable senator opposite to criticize. When I asked Senator Dittmer, during his speech, what he believed was a reasonable amount of unemployment to have in Australia, what answer did I get? He said, in effect, “Work it out for yourself”. He believes, I suppose, from a political point of view, that there should be 01 per cent. That is impossible. We could never achieve that figure, but we can get the number much lower than it is at present and much lower than what some members of the Labour Party in another place have claimed is the goal at which all governments should aim.
I have nothing more to say on this measure. I am very sorry that the Opposition has decided not to put up more speakers. I believe that this measure will receive the full approval of all the Australian people and that the Government is to be commended on the action that it has taken in this and other measures to reduce unemployment in Australia.
.- The purpose of this bill is to authorize the payment of £10,000,000 to the States. It has been described as a package deal with the State Premiers to relieve a temporary situation that has arisen, pending some other expedient that the Government will have to employ, as it has employed expedients from time to time. Any one listening to the speech made by Senator Scott must have wondered what the bill was all about because he did not refer to it at all. He could have mentioned that of this amount of £10,000,000, £990,000 was being allocated to Tasmania and £660,000 to his own State, Western Australia. The Western Australian allocation is the smallest. Evidently, the Western Australian Government wanted to have so little to do with the Federal Government that it did not even get in for its share of the £10,000,000. It wanted to keep the Federal Government so far away that it would not even complain about the small amount that was being made available to it under this grant. The Western Australian Government was prepared to accept £660,000 and did not want to recognize where the money came from. Senator Scott, representing Western Australia, did not put up a very convincing case for his State. I have heard Senator Scott say that this is a States’ House and that honorable senators should repeatedly put forward the views of their States and speak of all their needs. Yet we find that the State of Western Australia is getting £660,000 as its proportion of this allocation of £10,000,000. He mentioned also the badly governed States of New South Wales and Tasmania. I think he was showing a little bit of political bias when he spoke in that strain, and it was very bad of him to introduce that strain into this discussion. After all, Senator Dittmer, who led the debate for our side, put up a very, very good case and said that he was supporting the bill, but then Senator Scott came forward and introduced a very bad note into the debate.
– I made a good case for the bill, too.
– You had better behave yourself now.
The ACTING DEPUTY PRESIDENT (Senator Tangney). - -Order!
– Madam Acting Deputy President, I thank you for calling the Senate to order, because honorable senators were becoming rather unruly and I have some rather pertinent observations to make. The attitude of Government supporters is such that one would think they were making a grand offer to the States and that they were solving the States’ problems by this legislation. But I want to keep reminding honorable senators that these expedients are very temporary. They do not give any opportunity for the State parliaments or for instrumentalities within the States, such as local government, to make any plans at all to alleviate the economic difficulties through which they are passing. Instead of their being able to embark on projects, many of which are in the blue print stage, the present method of eliminating bad pockets of unemployment is to engage men to chip weeds on footpaths and perhaps do a little bit of clearing work here and there. I understand that the forestry departments are getting some extra money to make fire breaks, but the bush-fire season is just about finished.
– Your Premier in Tasmania has not said that.
– No, the Premier of Tasmania realizes that he has to rake every penny he can get, because Tasmania has been on the border line for a long time in financing its projects. It is grateful for everything it can get, and the Premier is grateful for everything he can get. Tasmania is grateful for a lot more than merely that which has been allocated to alleviate unemployment in that State. One of the reasons why Tasmania was given the extra allocation out of this £10,000,000 is that the incidence of unemployment was greater there - as it was in Queensland - than it was in the other States. Really, the Premier of Tasmania had both hands out for every penny he could get. All State Premiers will continue to do that because they are in the difficult position where their debt per capita is increasing, though I admit that the allocation under this bill is a handout and there is no obligation to repay it. It is free of interest and is a very acceptable amount, made by way of a nonrepayable grant, additional to the financial assistance grants to the States under the State grants legislation.
What will be the result of this nonrepayable grant? Will the States be able to prevent the situation that prevailed in the early part of this year from recurring as soon as the effect of this temporary measure has ceased? At that stage there were 130,000 registered unemployed, and possibly up to 200,000 people were affected by unemployment. Is there anything permanent about these measures that the Government is introducing which can give those people faith and confidence in the future? It is rather interesting that the policy of Government supporters has changed so quickly. Only three or four months ago, when the Opposition was drawing attention to the unemployment position, we were poohpoohed by Government supporters who said: “ The situation is not bad at all. We have plans afoot that will restore the economy.” As it turned out, not only did the electors of this country remind the Government that it was right out of touch with reality but also it has slowly dawned on Government supporters that the Government received a very sharp rebuff from the electors. The business community is finding, now that the wool is starting to disappear from in front of their eyes, that the Government’s promised quick relief is not forthcoming. Even in the past week or so business people, through their journals and personally, have been telling the story that they have never seen business as bad for 20, 25 or 30 years.
– Did you say the motor industry said that?
– No. The motor industry is the only one that can claim that its sales have increased. The reason is that the savage impost of sales tax, when only one or two Government supporters had the intestinal fortitude to get up and defend the very people whom Senator Branson is now speaking about, resulted in the general public being frightened out of buying motor vehicles, though to-day a motor vehicle is an absolutely essential part of people’s daily lives. People just cannot get about now and cannot carry on normal business without motor transport. One must have a motor car, and putting sales tax on vehicles is the same as putting a tax on household goods. Not only is it an imposition on the private vehicle owner, but also the sales tax on commercial motor vehicles is added to the cost of production, and so the inflationary process goes on. The increase in sales tax frightened people out of buying motor cars and there was a lag in demand. Of course, it was part of the Government’s policy to cut down production in the motor industry. That was the Government’s intention, and it had its desired result. People who really needed vehicles to build up and maintain efficiency in their industries but had been rather reticent about investing money in motor transport when there was such a high rate of sales tax on it, decided when the sales tax was reduced that this was the first priority in expenditure. The motor industry, because of its efficient tooling and techniques, had the capacity to catch up the lag. Also, it was carrying large stocks because the axe came down so suddenly that sales did not taper off. It is a great credit to the motor industry that it has been able to fulfil orders again so quickly.
I should like to remind some honorable senators on the Government side that this process is not quite as easy in other branches of industry. In the economic system in which we live there is an inertia in industry and the slowing-down process has wide repercussions. When the orders start to decrease the monthly returns of the salesmen out in the field begin to drop and so the amount of raw materials being ordered by the company is reduced, and the number of employees falls. By degrees, as the indications come in from the salesman on the road - the whole momentum of the factory slackens. In the normal cycle, unemployment occurs and purchasing power is reduced. The community loses confidence and a recession - Government-made, deliberately - occurs. There is unemployment, caused deliberately by Government policy. All the resulting suffering, hardship, disappointment, disillusionment and resentment among the people are caused by Government policy. Incentive is destroyed and individuals who are trying to make their way in manufacturing industries and to supply the domestic market in particular, but with the hope that they can also supply overseas markets with manufactured goods feel frustrated.
So to-day we see this process in which business is very slow to recover. Branches of industry, as a result of propaganda or, perhaps, in some cases, a slightly improved demand, have some slightly improved orders. But the factories have not stockpiled the raw materials to enable them to fulfil those orders. They could not afford to stock-pile. The banks asked them to reduce their overdrafts and they had to sell every bit of stock that they could possibly push out to meet their bankers’ requests. Now they are being urged to get raw materials to turn into products to supply the demand. But there is a big lag between the time the raw materials are acquired, and when the demand is supplied and it may be some considerable time before the lag is overtaken. That is considered to be good policy - good orthodox economics and financing on the part of the Government! Perhaps by the end of the winter or by next spring the unemployment figures will show an improvement and every one on the Government side will be satisfied that this policy is right, regardless of who is burt in the process - who are the individuals concerned - and what is happening within the community in terms of human values.
Only last week in the course of my remarks on housing I mentioned the impact that Government policy has had on the building industry and, in particular, the very bad effect that it has on employment in that industry, on the absorption of young men leaving school in the building trades as apprentices. Even now, none of these industries is being given any guarantee of continuity of orders and employees have not assurance of continuity of employment. It is interesting to recall remarks that were made last December by the Prime Minister (Mr. Menzies) and members on the Government side when we suggested that there should be an increased deficit. We said that £100,000,000 was needed to prime the economic pump and that in restoring full employment we would need to give the States more money, and to raise more loans. We were accused by Government members of all sorts of deceitful things. We were presented to the public as being irresponsible. The Prime Minister said that the offers that were being made by the Labour Leader in his policy speech and by Labour speakers were completely dishonest. I wonder whether Government members and the Government Leader have any conscience at all when they adopt in such a short period, the very things that we advocated and which they had dismissed as irresponsible. Not only for the order and good government of this country, but also to save their own political hides, they now have to introduce and implement the policies that we advocated.
It was our proposal that money should be injected into the community in the form of increased social service payments, including child endowment and pensions, so that the money would be readily spread throughout the economy. Those who receive social service benefits quickly spend the money on simple needs - food and clothing - so that the money quickly permeates the economy. We told the people that by this means we could prime the economic pump most effectively. All that the Government has done in that direction has been to improve unemployment benefits. I suppose that persons who are unemployed, through no fault of their own, are entitled to be able to meet family responsibilities - not that the increased payments to them will enable them to do so, but it relieves their load to some extent.
– What about the extra money for housing?
– I shall come to that in a minute. Instead of the policy that we advocated of giving effective assistance to. families by way of child endowment and to the aged and invalid, so that the money would be readily put back into the economy, the Government has introduced income tax cuts. It has been argued that these cuts are on a pro rata basis and that those who pay the most should get the biggest deductions. But the amount by which the weekly tax instalment payable on a salary of £1,500 a year or less is reduced is practically infinitesimal.
– I thought we dealt with that legislation last week?
– I refer to that only for the purpose of illustrating that the Government is not measuring up to the performance the people expected of it after it received a severe jolt on 9th December last and was told that its policy was not good enough. Had it not been for the Communists in Moreton, this Government would not be in office. The ordinary people of Australia did not want it as a government. Only with the aid of preferences of the Communists did it retain office. If the Government were to meet the wishes of the majority of Australians, it would not be introducing legislation such as this, which is only stop-gap legislation.
We believe that a person on the basic wage who receives an extra 15s. or £1 a week in the form of child endowment will spend that amount on his family needs, whereas a man in the higher salary range who receives a concession of £3 or £4 in his monthly salary may only have a few more punts on the stock exchange, take out another unit of superannuation, or salt the money away because it is surplus to his immediate needs. The difference between Government policy and our policy is one of very great importance. The Government claims that it is taking appropriate action in view of the state of the economy. According to a report the Prime Minister stated -
Cabinet had, after valuable consultations with a wide range of industries and interests, reviewed the present state of the economy and closely considered policy and appropriate action . . . The Government was concerned both at the level of unemployment which was then evident, and at the weakness of confidence which existed.
He went on to outline the series of measures that the Government intended to take to deal with the situation. -
– You will agree that this £10,000,000 will go straight to the job?
– I should say that it would go straight to the job, but it will not be of lasting benefit to the States, as it is not sufficient to enable them to embark on any substantial form of endeavour.
– It is not meant to provide more capital works.
– It should enable continuity of planning for the future. State governments are in a very awkward position, because they have to allocate responsibility to the various departments and they have to budget from one year to another. It will be getting on towards
October and November before the Commonwealth Budget and State budgets are through. The wheels then start to turn. Arrangements are not finalized before Christmas and very little is done during December and January. Then, about February, the officials get their thinking caps on, realizing that this money must be expended.
– That is not true. I was in a State parliament long enough to know that that is not correct.
– The honorable senator knows very well that it is correct. In the departmental view, one of the greatest sins is to go to bed with a surplus. This means that the departments desire to spend their money before 30th June. If they do not, then the money will go back into Consolidated1 Revenue.
– That part of it is true.
– Now the honorsenator shows that he knows something about it.
– The money is allocated long before Christmas.
– Sometimes it is and sometimes it is not. The availability of the money is doubtful. Sometimes it is readily available, but planning is from year to year. By the time the engineers and others know they have an added allocation, consider ways of using it most effectively, and then get to work, it is usually after Christmas. If things are going well, there is a rush to spend in the last month or so of the financial year. Every one knows that State governments and departments have a hand-to-mouth existence. This should be seriously considered by responsible people. No society to-day can live from month to month or, for that matter, from 30th June one year to 30th June next year. Nearly all works of substance to-day are spread over one, two, three or four years. An authority can build and seal portion of a road. It can build a culvert as part of a road. But if it is building a bridge, it is not of much use to build part of the bridge, because until completed the bridge is of no value whatever. These are matters that call for long-range planning. This is a temporary measure intended, as the Prime Minister said, to produce the quickest possible result. This money is to be made available in the form of nonrepayable grants for use in employmentproviding activities, mainly in the works field. The statement was made on 7th February. The measure is now before the Senate on 3rd April. Senator Scott wants to delay it even longer.
– What is that?
– The honorable senator said that he wanted to hold it up because senators on this side were not delaying it long enough.
– I said that you were not talking on the bill.
– That is the same thing. By the time this measure passes through the Senate, only three weeks will be left in April. There will then be four weeks in May and four weeks in June. Therefore, only eleven weeks of the financial year, in which to spend the money, will remain. The measure is indicative of the Government’s stop-and-go attitude.
– Can you not think of another term?
– Yes, it is a yo-yo Government, with its policies going up and down. The trouble is that the Government is not even a good yo-yo player. Sometimes it hits the ground, the string buckles, and the yo-yo won’t come up again as it can be made to do by the good yo-yo player.
I want to touch upon another matter in relation to grants to the States. It was said that this was a package offer and was considered as such. The only desirable feature, as I see it, is that it will not involve the States in interest charges or repayments. The States need a grant of this amount each year - non-repayable and non-interest bearing - to enable them to meet the increasing interest burden that is being imposed on them by the Commonwealth Government. The Commonwealth debt per head of population is decreasing each year, whereas the States’ debt is increasing. The interest payments by the States are increasing, as are the loan repayments, which go to Consolidated Revenue.
– Why are you talking about interest when no interest is charged on this money?
– I am saying that this amount of money should be made available to the States each year to enable them to pay the interest charges on loans. The Commonwealth Government, for some reason or other, insists on charging a high interest rate on money it makes available to the States. It is imposing on the States each year a greater burden of debt, on which high interest is charged. That has been going on for a number of years, even before the present Government came into power. Each year the amount that has to be repaid by the States is increasing. People earning money at present are paying interest on money that was expended fifteen or twenty years ago, and the money paid by way of interest is coming back to the federal treasury. If the grant referred to in this bill were an annual grant, it would help the States in paying the iniquitous interest that is charged by the Commonwealth in respect of revenue raised by taxation and lent to the States. Money that is raised by taxation does not attract interest charges. Income tax is collected from the taxpayers in advance, and they lose the opportunity to earn interest on the money.
– On some of the money that your State and my State are receiving we are not obliged to pay interest at all.
– That is the point I am making. The States need a grant like this occasionally to enable them to catch up with the high interest charged on money lent to them. This Government just cannot allow cheap money to go to the States for housing; it keeps the interest rate as high as it can. It is a great tragedy that an instrumentality such as the Development Bank should charge an average interest rate of 6 per cent. That is an imposition that the farming community is not able to bear.
Senator Lillico and Senator Wright were present the other night at a meeting where irate farmers complained that the best they could expect was a return of 2 per cent, on their invested capital. That is a poor return for the amount of work a farmer has to do to run. a property efficiently. If he wants to do some developmental work, and is lucky enough to break through the barrier against his obtaining a Development Bank loan, he then has to pay an average rate of 6 per cent, interest on the loan. How members of the Country Party, who are supposedly the champions of the farmers, and who have kept this Government in power for so long, can face their supporters, I do not know. I do not know how they pull the wool over the eyes of these people and stage-manage meetings so that irate farmers cannot see the true position. I do not know how they are able to get away with it. They still come here, supposedly representing the farming community. They know very well that the farmer is getting only a 2 per cent, return on his invested capital, yet they support a Government that charges him an average of 6 per cent, when he wants a loan to develop his land. The farmer is expending at the rate of 6 per cent, to enable him to earn at the rate of 2 per cent. That is a ridiculous state of affairs, yet is fully supported by members of the Country Party. How they are able to get away with it and keep the Government in power, I do not know.
– They are serving two masters.
– At least two. When the Labour Party put its policy to the people of Australia, we said that we wanted to get people back to work. We said that far too many people were out of work and that deficit financing would need to be used during the next year. We were decried as dishonest and irresponsible, yet we find now that the Government has had to implement our policy. In the housing field, the Government has done exactly what the Opposition said would have to be done in order to put building workers back into employment. The Government has followed our policy. The Opposition suggested that grants of this type should be made to the States so that they could put the wheels of industry into motion again. The Government is doing that in this measure.
The Opposition wishes this bill a speedy passage. We know how much the States are looking forward to receiving this money. The grant is too small; it should be doubled or trebled. If that were done, the measure would be a lot more effective. This should be the forerunner of many other interestfree, non-repayable grants to the States.
– I am very glad that Senator O’Byrne made reference to the bill as he drew his remarks to a close. His was quite an extensive excursion into many spheres and fields, and we were relieved that, as be closed his contribution to the debate, he indicated that he supported the measure. I join with Senator O’Byrne in wishing the measure a speedy passage.
I shall deal with the bill from one angle in particular. The bill stems from steps taken by the Government and announced earlier this year. They have been recounted and confirmed by the Minister for Civil Aviation (Senator Paltridge) during his second-reading speech.
The Prime Minister (Mr. Menzies), in reviewing the situation after the talks that he had had with various leaders of the community, directed our attention to a number of significant points. After adding all of them up, he made the point, early in February, that the talks indicated that the capacity of the Commonwealth to play an effective part in dealing with the circumstances that then existed would be increased. The Government said at the time that it desired that a programme of recovery should be promoted with the greatest speed. Associated with that programme were two special problems, one being the level of unemployment and the other public and national reassurance. So, this bill comes before the Senate to-day for the purpose of making to the States a non-repayable grant of a total of £10,000,000. South Australia, with which I am most concerned, is to be allocated £970,000. The two factors that I have just mentioned are very much in mind.
It is only natural, Madam Acting Deputy President, that all honorable senators are specially interested in the value of these grants to their respective States. We are all concerned very much, of course, with their effect nationwide, but, as senators, we have a prior interest in their effect on our particular States and on the influence they will have on the employment situation and on public confidence. There is, however, another matter in connexion with these grants that I should like to mention in this discussion, because I feel that a bill of this kind marks a further step in the relationships between the Commonwealth and the States as they interpret the financial affairs of this country.
Honorable senators will be aware of the growth and development of the programme of financial relations between the Commonwealth and the States, and of the history of the movement as it has been related to grants, loans, and so on. Over the years there has arisen a need for the allocation of money by the Commonwealth to the States for a number of purposes which, I suppose, might be regarded as being well within State spheres. But, by their very nature, those purposes might not have received attention had it not been for certain Commonwealth interest or action. Examples which quickly come to mind are university education and mental hospitals. So, the measure that is currently before us is of some interest historically because it is a part of a process whereby the States are enabled to do things that they want to do and, at the same time, those things have a marked effect so far as the Commonwealth is concerned. As I have said, there are certain features of the measure which have an historic nature and go beyond the immediate financial association. They are a part of the pattern of increasing federal responsibility. We are involved in the process of development of the financial relationships between the Commonwealth and the States.
I want to turn now to that part of the measure which affects my own State. I hope that what I say will not be regarded in isolation but will be looked at as part of the entire pattern of the measure. The overriding general purpose of the grants, as the Minister said in his second-reading speech, is to provide employment. The States having received advice that these amounts were likely to be forthcoming and trusting the Government to make them available, it is quite well known that they have put in hand plans for the continuation of works that are already existing, or have initiated such schemes as might be desirable. Therefore, it is interesting to have a look at relevant figures, such as those relating to unemployment. Here, I turn again to South Australia in particular. The figures have been supplied by the Commonwealth Bureau of Census and Statistics. It is not without significance to note that at the end of January there were 10,261 people registered for employment with the Commonwealth Employment Service in
South Australia. At the end of February, a month later, that number had fallen to 8,145, or a reduction of more than 2,000. Similarly, the unemployment benefit figures also indicated an improvement in the situation. The amount paid out by the end of February had fallen some £4,500 below that paid out by the end of January. Those figures indicate that the propsals outlined by the Prime Minister, and reflected in this measure before the Senate, were already becoming effective.
It is also timely to point out, in another phase of South Australian development which reflects the restoration of assurance and confidence, the other element referred to in the bill, that concurrent with the substantial fall in unemployment in South Australia, over the same period there has been a substantial rise in certain factors connected with the building industry. Referring again to figures supplied by the relevant Commonwealth department, we see that building approvals in South Australia during February were valued at £6,000,000, or more than double the January total. Approvals for new dwellings or additions were valued at £1,500,000 in January and £2,230,000 in February. The value of approvals for other new buildings rose from £722,000 in January to £3,430,000 in February, or to almost five times the January figure. Honorable senators may well seek some clarification of a contrast of that kind, but nevertheless I submit that it reflects something of the improvement that is taking place as a result of the measures announced by the Government.
If the Senate wants further evidence of the point I am trying to make, and if it should be thought that perhaps the figures I have cited are not related to the stream of society in which we want to see confidence engendered, may I direct attention to such a humble thing as savings bank figures, which are always a very good guide. They reflect the life, the thought and the disposition of the people who keep accounts with the savings banks. The total has increased by more than £1,300,000. Senator O’Byrne referred to motor cars. We find that in February there was an increase of 500 in the number of motor vehicle registrations in South Australia. If we want figures for something affecting the average person, let us look at those for television licences. The number of licences issued in February was more than double that issued in January.
I am prepared to acknowledge that those are State figures, but I submit that they are part of the pattern of recovery stemming from the Government’s measures. This is good news in figures, and it is one of the many healthy economic trends. The adoption of the bill before the Senate will ensure a continuation of the Government’s programme. If I may return to South Australia, the measures that the Government proposes are already having an effect in meeting employment needs. Honorable senators from South Australia will recall that the moment this pattern of grants and this allocation in particular was established, Sir Thomas Playford, the Premier of the State, sent back from Canberra his almost famous message - “ Get cracking! “
Broadly speaking, the allocation of £970,000 to South Australa will be channelled into two main streams, those of engineering and water supply and the public buildings. That is in line with the purpose of the measure, and the employment situation should be relieved quickly. Works activity will be accelerated, and the whole range of South Australian society will benefit. My inquiries reveal that the schoolbuilding programme in Adelaide is being stepped up. Obviously you cannot build new schools very quickly, but the programme is being accelerated. Additions are being made to various schools. The programme of maintenance has been accelerated. The school-building programme is going along faster in places such as Kimber on the Eyre Peninsula and Elizabeth West, north of Adelaide. I have had some association with the school at the latter place and I am very glad to know that that structure is being completed much more quickly than would otherwise have been the case. I submit for Senator O’Byrne’s consideration that the undertakings to which I have referred, and others, are a far cry from the chipping weeds and burning fire breaks complex to which he referred earlier in the debate.
The money being provided under this grant will greatly assist the construction programme associated with the Adelaide Teachers’’ College. Honorable senators will not be surprised to hear from South Australian representatives in this chamber that some of the money provided to South Australia under this grant will be applied to certain water supply systems in the State. South Australia badly needs an improved water supply. The grant of this money will mean that certain water supply undertakings can be accelerated to provide better facilities to South Australians much sooner than was envisaged. I have seen plans associated with the water supply projects designed for the Sellicks Beach and Aldinga areas south of Adelaide. The grant will also enable work to be undertaken on the extension of sewerage mains and other services in the outer suburban area of Adelaide. It will be used also, of course, to accelerate the very important programme associated with the Morgan to Whyalla pipe-line. That project is not devoted solely to water supply but involves the industrial expansion of Whyalla. This grant is of very great value to South Australia. The South Australian Government is very happy to receive it and will apply it readily, effectively and usefully.
The grant provided under this measure is not an example of a yo-yo performance by the Commonwealth Government, as has been alleged by Senator O’Byrne, but is rather an indication of its positive approach to the situation that exists in Australia to-day. I submit, Madam Acting Deputy President, that the two essential needs for which the bill is designed will be met. As the figures to which I have referred indicate, the Government has already gone far towards relieving the unemployment situation. In addition, the Government’s measures have contributed in no uncertain fashion to the public and personal confidence of the South Australian community. This factor is reflected in the way in which the community has responded. As evidence of that trend I refer the Senate to the leading article in “ The News “ of 2nd April. “ The News “ is Adelaide’s evening newspaper. Consistent with the freedom of the press, that newspaper from time to time feels at liberty to express itself very firmly concerning Government policy. Last night it published a leading article under banner headlines reading “ In winning vein “. The article reads -
The Australian economy, boosted by the Federal Government’s back-to-prosperity measures, continues to gain in strength and vigor.
On all sides there are signs of renewed activity.
The article then quotes the figures to which I referred earlier and continues -
Observers in close touch with economic affairs confidently predict that the March figures will show an even more marked improvement in our State and national affairs.
There is nothing wrong, there never has been anything wrong with the Australian economy. Given anything like a chance to live, it fairly bursts with life.
This is the economy of a people on the winning side. All it needs now for a total recovery is the continued confidence of the public. There must be no stone-wall tactics, no playing for a draw. An outright win is ours for the taking.
That may be an example of a newspaper giving expression to its views, but I support the remarks contained in the article. In my view the objectives that the Government had in mind in introducing these measures are being achieved - gradually in some places; more quickly in others. Those achievements will ultimately form part of our everyday life. I have pleasure in supporting the motion for the second reading of the bill.
.- Madam Acting Deputy President, as other honorable senators have said, the bill before the Senate provides for a grant of £10,000,000 to the States in order to improve the employment position. It is interesting to recall how the present employment situation came about. Eight or nine months ago it looked reasonably satisfactory. Everything was proceeding smoothly. Some people were unemployed, but the number was nowhere near what it is to-day. I, like other honorable senators, am delighted to know that the unemployment figures are falling. But I am concerned to know whether the Government will profit by its past mistakes. Some Government supporters are so arrogant as to say that the Government’s economic measures of 1960 and 1961 were acts of statesmanship of which they are proud. Those acts landed the economy in a hole. I think the Government will learn a lesson from what has happened because nothing teaches a government more quickly than the votes of the people. Votes are wonderful medicine for people who indulge in rash actions and say that because they have a majority of 32 in another place they will plod along with their same old policies.
I do not for a moment think that the Government envisaged the results that its economic policies would have. I do not think the Government was so callous as deliberately to plan the disaster that its policies brought about. The Government was complacent. It had been in office for many years and was sure that it would remain in office for many more years. But the Government does not govern in its own right anc! has not done so for a number of years. Figures for the last election show that the Australian Labour Party polled 330,000 more votes than the Government parties, but by devious means - by relying on supposed friends here and supposed friends there and with the support of the Country Party, which is happy as long as it is the second government party - the Government has managed to stay in power.
– You would be completely guiltless in that respect, would you?
– We are. I can understand why my friend is a little upset.
– I am not upset in the slightest degree.
– Then I will withdraw the word “ upset “ and say that he is concerned about this matter. You have been here for a number of years, but not in your own right. I am not talking about Senator Hannaford as an individual. He ls rather a nice man. He is not a bad fellow at all. I am speaking about his political party. Tell me when the Liberal Party has won an election in its own right. We have to go back a long way. The Liberal Party has hung on to the people in this corner, the members of the Australian Country Party. Honorable senators on both sides of the chamber are interjecting. I do not want to ask for your protection, Madam; but at the moment I am getting interjections from the left and the right.
– Which do you dislike more?
– To be quite, candid, I think each is a bad as the other.
I like to travel along a straight line. I may cause a bit of an upheaval from time to time, but as a rule we get through. As I was saying prior to drawing myself away from the bill or being drawn away from it by my honorable friend from South Australia, Senator Hannaford, the fact is that this £10,000,000 was divided among the States in proportion to the numbers of unemployed.
The Premier of my State, Victoria, was most annoyed about that. In a newspaper that cannot be considered in any way to be antagonistic to the present Government, the Melbourne “Age”, an article appeared under the heading “ Premier’s attack on allocation of State grants “. He made a rather big splash during the supply debate in the State House. He was annoyed because Victoria received only £1,800,000. Although other States might be larger in area, most of them are much smaller in population.
– He was not taking a wide national outlook!
– I am not doubting that. I do not want to take other than that outlook. I am saying what the Premier of Victoria said. I have not said that I support him in his attitude.
– You referred to him.
– I did. If my friend was a bit more on the ball- -
– The football season has not started yet.
– It started more than a week ago. I could understand the heathens from New South Wales and Queensland not knowing anything about our grand game, but I am surprised that a South Australian should not know all about it. I am delighted that I am being helped by interjections from both sides of the chamber. I have to do a certain job. I want to do it and these interjections make it easier.
Speaking seriously, no one objects to this measure; but what does it achieve? I speak with some knowledge of this matter. This money has not put one person back into work in Victoria; it has merely retained in employment the people who were working.
– That was not this Government’s intention.
– No. I am not blaming the State Government. It runs its own affairs. Victoria reached the stage where it had no money for roads and the schools allocation had been spent. The State was in a pretty bad position.
– Because of bad planning by the State Government.
– I can understand my friend from Queensland accusing the Victorian Government of bad planning, but I am not completely certain that his statement is true. I must be a bit loyal at times. We must remember that Victoria is developing rapidly, but money was becoming a bit tight. Victoria will be lucky if this money will keep in employment the number of people who were employed by the Government at the end of the first or the second month of this year. It was a common occurrence to read that many men were being put off work by the Country Roads Board in this centre or that centre. I think the Minister for the Navy (Senator Gorton) will agree that what I am saying is true.
What will happen when this money has been spent? It is true that all the States will receive their moneys at the beginning of the next financial year. If Victoria spent its money in ten months this financial year, because of the number of new people in the State and the number of children who have left school and gone into industry, the State is more likely to be in a similar position during the next financial year. Therefore, I believe that this measure is more or less another episode in the stopandgo economic policy of the Government. That is what concerns me.
I am speaking about Victoria because I know it better than I know the other States. This money was given to the Victorian Government to re-employ people, but it employed people only in government authorities such as the Country Roads Board. I understand that the Government called tenders for the fencing of a great number of school grounds in order to keep in employment people employed on a daily basis. This money did not affect the person whom private industry had employed in the past. Unfortunately, there is no place for such people at the moment. I want to know what will happen at the end of the 1962-63 financial year. The employment of a number of government employees will be iri the balance according to the funds of the respective departments.
The Government is much too hopeful in thinking that private enterprise will be able to employ a greater number of people than it would have normally employed. I should not like to see periods of boom and burst. A government has an obligation to plan so that there can be a steady growth and employment can be given to those people who are being brought from overseas to help us in the development of this country, and so that we can find places in industry for the young people who are leaving school. I was pleased that Senator Davidson was able to cite figures to show that the number of building permits issued in South Australia was greater than in the first month of the year. However, with great respect to him 1 point out that work does not normally commence until after the first fortnight in the first month of the year and that therefore it would have been far better if he had compared the latest figures with those in other than the first month. I do not think he gets anything out of that comparison at all.
Though I welcome the bill - any one would be foolish not to welcome it - I still think that the Government has to go a lot further. As much as it might object to planning, it must lay down a plan to show industry where it can go for a year or more. The Government cannot expect industry to spend money on enlarging plants without knowing what the Government will do, particularly in view of the fact that the Government has now adopted a new method of controlling output. It does not use sales tax merely for the purpose of obtaining revenue; it says that it uses sales tax - though this is a debatable point - to alter the economy as it wants to, as was evidenced in the motor trade. I recognize that more motor cars are being sold now. Every one must acknowledge that the wise owner who drives 12,000 or 15,000 miles a year trades in his car after two years. Of course, commercial owners who receive a tax rebate for depreciation of vehicles are most unwise if they do not trade in their vehicles early. I am not saying that I do not want to see industries prosper, but unfortunately as long as a great majority of the young people can obtain hire-purchase money they will buy motor cars. I have my own thoughts on whether in the long run that is in the interests of either themselves or the nation. I think it would be much better if we could inculcate into the minds of the young people the idea that their best plan is to get a block of land first, because it will not wear out in a couple of years, and they may be safer in their own homes in years to come.
No one could disagree with what the Government proposes to do under this measure, but why does not the Government go further? Why does it not say to the States that they can spend at a greater rate than their normal reimbursement would allow them, feeling quite secure in the knowledge that the people who have the purse - and this is the only place where the purse is - ;will see them through when they want to develop?
– What - give them carte blanche?
– No, I do not think that would happen. I do not think any Premier, irrespective of his political colour, would not stand up to his responsibilities. What is the Government doing under this measure? It says, in effect, that the money allocated by it will last the States until about the end of June. The measure is meant to improve the employment position in the States up to the end of June, but what will the States do after that? They will go back to their normal allocations for the financial year 1962-63. I believe that I am correct in saying that, judging by the experiences of last year, in the ninth or tenth month of the next financial year the States will find themselves in as bad a position as they are in at the moment with their own public works. It could happen sooner. When all is said and done, the States have carried a heavy burden with their education programmes as a result of the immigration scheme of federal governments, irrespective of political colour. I have never thought that the States have got a fair crack of the whip in the allocations of any government that has been in office in Canberra, considering the increasing population. The States’ reimbursements are calculated according to the following formula: - The population of each State as at the preceding July is divided into the total amount to be reimbursed to all the States, and the result is multiplied by the number of people in each State at the end of June. The amount is further increased by a percentage equivalent to the average increase in wages for the year in question, plus one-tenth of the average increase of what is known as a betterment factor.
– It is not altogether simple.
– That is the reason why 1 had to keep my eyes on a piece of paper as I stated the formula. It is not altogether simple, but it seems to work out.- However, what I am concerned about is that the Government is not giving the States enough money to carry out their commitments for the whole year. I am certain that with Victoria’s share of the £10,000,000 that State will be lucky if it is able to carry on normal State works to the end of June. That is what I have been told in Victoria, not in any effort to try to gain political kudos, and though the Minister for the Navy (Senator Gorton) laughs, I am being quite candid about it. I think Mr. Bolte will be lucky to maintain the normal employees of his State without helping others outside the Public Service.
– You mean that he would have run out of money if he had not got this grant?
– Yes. He would have done so.
– He was not planning very well, was he?
– I am not saying that. He owes me a little bit on a venture in which I am interested. I was told that he had no money and I went to some trouble to find out whether that was true. I found that it is true. The allocations were spent. I believe that while the Government is trying to remedy a disease that you unwittingly caused - can I be kind enough to say that - it is not looking beyond the immediate future. I want the Government to look farther ahead, because it will never get private enterprise to do what it wants it to do unless private enterprise can see profit for itself over a reasonable period of time. I do not blame the people in private enterprise for that attitude. No one is putting money these days into industry merely for the sake of putting money into it. He wants a profit.
How will the Government regain the confidence of the people? Senator Davidson said, “Look how the savings bank deposits have jumped “. It is quite true that they have, but it is bad from a business point of view. The fact is that the savings banks, whether they are Stateowned or private - and I see enough of these private enterprise fellows on television-
– Free enterprise.
– Yes, that is the beautiful phrase. The fact is that these savings banks do not keep the money. They lend it out if it is wanted. But to-day it is not wanted. All the banks are reported to have a tremendous amount of liquid assets. It looks to me as if there are no takers for the money. Banks are in business to lend money at a profit, and if they do not lend money at a profit they are not doing as well as they would desire to do. As I said here the other day, the best yardstick by which to judge whether the people are spending is the rise or fall in hire-purchase commitments. Up to date, they have shown a fall. Hire purchase is the system that the majority of the people use to-day. I am not saying whether it is the right or wrong method - that is a matter for the individual. I have very strong views about it. I believe, with Bobby Burns, that if you earn £1 and spend 19s. 9d. you have no worries; but if you earn £1 and spend £1 0s. 3d., debt catches up with you sooner or later. It is a matter for the individuals themselves and I quite admit that a lot of people use the hire-purchase system to buy their goods. It is a remarkable thing that though they can buy washing machines and refrigerators on hire purchase at exorbitant rates of interest - 7 per cent, flat, which works out at about 17 or 18 per cent, overall - for some reason they just cannot save the money over a period to pay cash for the articles. That is their method and I do not think that any one in this country - certainly no government - would dream of suggesting that hire-purchase transactions should be stopped. The wheels of industry get such a kick from hire purchase that if it suddenly stopped we would wonder what had happened. If is a method that has been brought here from the United States and it is now extending into governments. I read in the Melbourne “ Age “ - I refer to the “ Age “ for it is more reliable than the Flinders-street press in my own city-
– It is not as good as the “ Sydney Morning Herald “.
– I know nothing whatever about that matter. You never want to bet on that newspaper. You may have it with you to-day, but you never know what will happen when you need its support in the future. That is our experience.
– That is also the “ Herald’s “ policy.
– I do not know what “ Herald “ you mean.
– The “ Sydney Morning Herald “.
– The Government has had the support of the Melbourne “ Herald “ and its chain over the years. As I was about to say I read in the Melbourne “ Age “ that the Government of Victoria is now introducing legislation to enable persons to pay probate duty by time payment.
– That brings a man back to life again!
– It does. I do not know what next we will have on time payment, but that is an example of how it has got into the swing of things. I say to-day that no government could dream of stopping the system at the moment. I know a car salesman and without mentioning the name of the make of car that he sells - it is a very common one - I can state that he informs me that no more than 22 per cent, of these cars are sold for cash, and that of that 22 per cent. 21 per cent, would be sales to industry. That is the position in the motor industry. I think the figures would be even higher, unfortunately, for the sale of television sets, though not as high for some of the other normal articles that are needed in the home. I say that if the Government is to restore confidence it needs to get the wheels of industry turning.
This measure is not helping my own State. In my opinion, it will not cause to be put back in employment any men that industry has laid off. It will certainly keep government employees in jobs. It will do that much good. I read, again in the “ Age,” i report that 800 men yere put off work by the Country Roads Board but that since the Government had announced it was making this grant of £10,000,000 to the States, the Premier of Victoria had ordered that the 800 men be kept in employment. But I do not know what the bill will do for the reemployment of others. All I can say is that the Government is not over-generous in the matter, when one realizes that £10,000,000 is only one seven-hundredth part of the gross national product which, in round figures, is valued at about £7,000,000,000, and that it is only about 3 per cent, of the total grant to the States for 1961-62, which was approximately £291,00,000.
The Government must go further. It must be bold. It must have a plan. It must be able to tell the people they may go so far and no further. That would be contrary to some of the things that the Government has said over the years, but all along it has been doing things it said it would not do. I know what Government supporters said about the banks in 1949. We know what restrictions the Government has imposed on the banks since then, although it is true that the Government did not take the banks over, as we wanted to do. However, it cannot be said that the Government has not hamstrung the banks. It has told them by divers means that they can do only this and that and that they can lend only in respect of this and that. Changes will come, whether or not we like it. Like sleep, they creep up on one. All of a sudden, some one wakes up and says, “ Who would have thought I would vote for that?” It is the normal thing. I believe that the Government wants to help. I do not believe it wants to see any people out of work. To say that it does would be just too silly. No one wants to see people suffer. We all want to see the country prosper and industries working. I believe that the only way to achieve that will be by the people being told the Government’s intentions.
The Government has not succeeded in putting many more people back to work. I hope that the position improves each month. I defy any person to say that he has spoken to a big retailer who is happy with the position. Unless the retailer sells, the manufacturer does- not - make, and if he does not make people are out of work. No one can object to the provision of this amount of £10,000,000. It is easy for me to point to the mistakes that the Government has made. The Government should be prepared to ask itself, if not openly, how it can rectify its mistakes. Surely there are enough brains in the administration of government departments and amongst the Ministers to formulate a plan whereby we may all be happy, industry will know where it is going, and we shall not have a boom period, followed by the application of the axe and men being thrown out of work. Surely we have learned that it is much easier to stop the economy than to restart it.
I believe that that is the duty of the Government. I hope that the bill will help the States, but much more will be needed before any Government supporter can be happy with the position. That position resulted from a set of unfortunate happenings. It cannot be rectified by this measure, and the provision of a little more for housing, and a little more for something else. The Government must restore confidence to industry. Even accepting that £20 is the average wage, a worker has to spend all of it, including the making of repayments of money borrowed for a home, in order to exist. That is shown by the growing number of people receiving social service pensions. This results from the system of living beyond our means. A much higher percentage of people will rely on social service payments as the years go on.
All I am doing - it may have taken a long time to say, it is true, but I have a reason - is asking the Government to go a little further and introduce a plan of which the nation will be proud, something for which, I feel certain, the Government would get much support from unexpected places.
– 1 rise to support the bill. I think I should read the title of it in case, having listened to Senator Kennelly, you, Mr. President, may not know what the bill is about. It is the States Grants (Additional Assistance) Bill 1962. I propose to address some remarks to it. Its purpose is to authorize payment to the States of an amount totalling £10,000,000 in this financial year. This money will be made available to the States by means of non-repayable grants, which are additional to the financial assistance payable to the States under the States Grants Act 1959. The bill stems primarily from a statement made by the Prime Minister (Mr. Menzies) on 7th February last.
I understand that since the general election the Prime Minister and Cabinet gave an enormous amount of attention to the problems that were then besetting Australia, with particular reference to the high level of unemployment. On 7th February, the Prime Minister made a statement which I think was significant in the great frankness with which it dealt with the problems besetting the economy. It will be well remembered that the Prime Minister and senior members of Cabinet had consultation with leading people in industry, trade unions and rural organizations, and as a result the Government was very concerned at the high level of unemployment and the lack of confidence, commercially, that was then apparent in the community. Certain measures were then presented to the Parliament at the earliest possible moment. The Senate has already dealt with measures relating to the reduction of sales tax and income tax. The measure now before the Senate provides for the grant of £10,000,000 to the States for expenditure on works, with the proviso that the money be expended as quickly as possible within four months from when the bill was first formulated.
It is interesting to follow Senator Kennelly, who, in a most tactful way, dealt with a number of aspects of the economy as he saw them, but the weakness in his speech, I thought, was that so much of his ideas were speculative. He gave his view of things that might happen. I think enough time has passed since 7th February for the Senate to consider to-night some of the things that have happened since the Prime Minister made his momentous speech on that occasion. I have received a good deal of encouragement from a close study of statistics and also from a study of statements appearing in the more reliable financial journals of this country.
I wish to explain to the Senate some of the things that have happened on an Australian basis, and later I will refer to some significant happenings within my own State, South Australia. I think it will be possible to prove to honorable senators that the steps taken by the Government, particularly this ?10,000,000 grant to the States, have already brought about significant improvements. This grant to the States was taken as an earnest of the Federal Government’s intention to do something quickly in a reproductive way, and industry responded. In the “ Financial Times “ of last week - incidentally, that was the last issue of this journal, which had a rather short but, I consider, a useful life - there was an article under the heading, “Economy Turns on More Speed “. The article reads -
Australian industrial activity turned on a burst of speed during February in response to the Federal Government’s economy concession’s.
The boost to business confidence brought a wave of re-employment and increased production.
Output of some basic materials increased by 30 to 40 per cent, over the January level.
Building materials such as hardboard, clay bricks and Portland cement all reacted strongly to the Government’s stimulus.
Activity in the building industry itself sharpened during February.
Total value of buildings approved exceeded the January figure by ?6,197,000 to total ?44,834,000.
This was the highest monthly figure of building approvals since November, 1961.
New houses and flats worth ?21,391,000 (January ?17,964,000) were approved.
The most pronounced recovery occurred in the durable consumer goods industry.
Television production increased from 13,000 sets in January, 1962, to 21,100 sets in February; the February production figure was almost twice as great as for February, 1961.,
Refrigerators, washing machines , and .radio sets all bettered the previous month’s ‘ output.
Production of motor bodies increased 3,600 to total 17,000 in February, the first monthly rise for four months.
So the story goes on. There was this marked improvement. As the journal said, the economy turned on more speed. This happened in February, after the close study that the Government had given to the problems of the economy. Towards the end of March it became very obvious that an im provement was occurring. I am not claiming that this ?10,000,000 grant was responsible for the whole of the improvement, because some of the money has not been spent yet, but I do say that the promise of the money, the determination with which the Federal Government announced it; proposal and the care with which it orked out the allocation, gave the right impetus in the right place.
It is clear to all of us, of course, that the allocation of this money was made, not on a population basis, but on the basis of need according to the unemployment that was bedevilling Australia early in February. It is interesting to read from press reports of 15th February the unemployment figures on a percentage basis. In New South Wales, 2.9 per cent, were unemployed; in Victoria, 2.5 per cent.; in Queensland, 5 per cent.; in South Australia, 2.5 per cent.; in Western Australia, 2.6 per cent.; and in Tasmania, 4 per cent. It will be seen that Queensland and Tasmania, with 5 per cent, and 4 per cent. of unemployment respectively, attracted the higher grants for the purpose of this shot in the arm, or booster. Queensland received 3,340.000 and Tasmania ?990,000. I suggest that reports coming from both Tasmania and Queensland indicate that a considerable improvement has occurred already. On 29th March the Deputy Premier of Queensland. Mr. Morris, is reported to have said that the number of unemployed in Queensland was expected to drop to about 21,000 by the end of March. The report continued -
By August the total was likely to be little more than 1 per cent, of the State’s work force, as against 4.4 per cent, at present.
It has apparently dropped from 5 per cent, to 4.5 per cent. The report went on -
Mr. Morris said this at the finish of a farreaching conference on Queensland economic position with the Prime Minister (Mr. Menzies), the Labour and National Service Minister (Mr. McMahon) and the Shipping and Transport Minister (Mr. Opperman).
The most important aspect of the conference was that it discussed prospective employment for the whole of this year, including the expected position after June 30 when the Federal Government’s emergency measures expire.
Mr. Morris said
I would like the Senate to note this - that’ of the ?25,000,000 injected into the spending resources of the States at the special Premiers’ Conference and Loan Council meeting early this year, almost £6,000,000 had gone to Queensland.
It was reliably estimated that since the Loan Council meeting work had been provided for more than 9,000 Queenslanders, he said.
Honorable senators can see that within the short space of time from 15th February to 29th March a rather spectacular result was achieved in Queensland. Did we hear of this from Senator Dittmer, the Queensland Senator who spoke earlier in this debate? Of course we did not. One would not expect to hear it from him, but those are the facts, reported in an Adelaide newspaper, of what is happening in Queensland at the present time.
I want to turn to the position in South Australia. In the Senate, where the States are evenly represented, I think it is only right that we should look at the figures for each State. I can speak with some knowledge of the South Australian position because over the years I have studied the economic position of that State very closely. South Australia received £970,000 of this special grant - approximately what it would have received if the distribution had been made on a population basis. Sir Thomas Playford, who was at the Premiers’ Conference, immediately instructed his ministers to deploy this money to the best advantage. It was obvious from reading the South Australian newspapers that confidence was restored immediately in a number of government and semigovernment departments.
A most striking development, of which I read a couple of days after the Prime Minister had promised that this money would be made available, concerned the Port Adelaide municipal council. That council has adopted a plan to spend £1,000,000 on roads and footpaths within the next ten years, the boldest step that that old and honorable body has even taken. As I see it, that typifies the whole purpose of the granting of this money. Municipal councils have been able to take a different view of things, and as I have said, the Port Adelaide council has led the way with this bold plan to spend £1,000,000 on roads and footpaths.
Within the department of the EngineerinChief in South Australia, plans have been made for the spending of £600,000, and in the Public Buildings Department, for the spending of £400,000. On 19th Feb ruary last, just four days after the money was promised, it was announced that 100 additional employees were to be put on by the Engineering and Water Supply Department. It can be seen, therefore, that in South Australia, this money is being quickly applied. The illustration of the Port Adelaide municipal council which I have given, shows that confidence has quickly spread from the centre. As I see it, that is the intention of the grants. Each State is free to exercise its own judgment and to use its share of the grants in whatever direction it thinks proper, the over-riding general purpose of the grants being to provide employment.
There are some other South Australian figures which I think I should present to the Senate in order to show the effect that this measure is having in a number of directions. Of course, it should be remembered that one of the reasons why South Australia is not receiving a greater share of this £10,000,000 is that its employment position had been brought under control reasonably well by the time the grants were being considered. As you know, Sir, South Australia is somewhat bereft of natural advantages. The motor industry is very highly developed in that State, and consequently, the sudden down-turn in the production and registration of new motor vehicles hit South Australia very hard. But last year, particularly during the winter months, the State Government engaged in great road building activity, particularly in construction work to remove bends from roads in the hills. It also developed very considerably the reticulation of water. It restored a number of old water pipes and mains which had rusted.
It was most noticeable in the metropolitan area last winter that the work that was being undertaken was greatly relieving the employment situation. That is why, when the figures were prepared for February last, the level of unemployment in South Australia was the lowest in the Commonwealth. Despite the fact that South Australia had a depressed motor industry, it was still able to record the lowest level of unemployment. Therefore, South Australia’s share of the total grant of £10,000,000 is lower than that of most other States. South Australians generally are proud of that fact. They acknowledge, of course, that the action of the Government in reducing the sales tax on motor vehicles has given a distinct lift to South Australia because the motor vehicle industry has improved most noticeably since February last. Both General Motors-Holden’s Proprietary Limited and Chrysler Australia Limited are putting on new employees each week.
It is very interesting to read the advertisements which those organizations are inserting in the Adelaide newspapers. They are calling, not for odd men here and there, but for men of the calibre of toolmakers and those who are able to assist in the tooling and re-tooling work of the various big motor subsidiaries in South Australia. That is a very good sign. The figures in this regard are most significant.
– Is there a shortage of such workers?
– Yes. The companies have to advertise most extensively in the newspapers of South Australia for the key men who are required in the future expansion of the industry. The employment figures which have just come to hand for February show that in industry generally, there were 10,261 applicants awaiting placement in January, and in February the number had dropped to 8,145. There was a considerable improvement in the building industry. The value of new dwellings planned was £1,080,000 in January and £1,125,000 in February. The value of other new buildings rose from £495,000 to £926,000. In December last, the number of bricks produced was 6,851,000. In January, it was 6,902,000, and in February, 8,389,000. If honorable senators go through the figures supplied by the Commonwealth Bureau of Census and Statistics in the “ Monthly Summary of Statistics “, they will see that there has been a big lift generally throughout South Australia. 1 believe that that is a part of the improved conditions brought about by the actions of this Government.
I conclude my remarks by welcoming this bill. In many ways it is a pity that more money is not being made available, but one should be grateful that this money is being provided. Together with the reduction in income tax and the impetus that will result from the imaginative taxation adjustments which are coming before the Parliament, it will have a good effect on the employment position. The money that we are voting under the bill will improve the economy both of the States and of the Commonwealth.
.- The bill now before the Senate gives effect to one of the Government’s short-term measures adopted for the specific purpose of improving the employment position in Australia. In his secondreading speech the Minister for Civil Aviation (Senator Paltridge) stated that the Government decided on its economic measures after reviewing the economic position as it existed on 7th February last. I contend that the Government’s measures are the direct result of the decision of the people given on 9th December last. Be that as it may, the purpose of this bill is to grant to the States various sums of money in an attempt to relieve the employment position.
On 7th February last the Government announced that certain measures would be taken to deal with the present economic situation. It is now almost 7th April - virtually two months after the Government’s announcement - and we find that the number of persons registered for employment has fallen by 19,000 compared with last month’s figure. But this does not mean that 19,000 persons have been placed in employment. Everybody knows that large numbers of those persons whose names have been removed from the register of persons seeking employment were young people who have returned to school. The improvement in the employment position does not mean that 19,000 new jobs have been found by private enterprise.
The present employment situation in Australia is highlighted somewhat when we look at the field in which we expect the quickest results. In 1950-51 the number of persons employed by private enterprise was 1,956,000. In 1960-61 the number was 2,274,000, representing an increase of 318,000 over a ten-year period. But the number of workers employed by private enterprise in December, 1961, was 2,231,000- a fall of 43,000. To-day’s press claims that there has been an improvement in the private sector of the economy to the tune of 34,000 persons employed. So we are still 9,000 persons down on the figures for last December. The total number of persons employed in the manufacturing industry in December, 1960, was 1,195,000. In December, 1961, the number was 1,146,000- a fall of 49,000. Yet it is the manufacturing industry that provides the greatest field for expansion of employment opportunities. At the end of January, 1962, about 131,500 persons were registered for employment. It is estimated that 100,000 persons are added to the work-force each year. Therefore this year work must be found for 231,500 persons. If the number of persons employed in the manufacturing industry reaches the number employed in the boom period of December, I960- 1,195,000- it means that 189,000 new jobs must be found this year.
The Opposition criticizes the bill because the amount it provides is inadequate. It is only a drop in the ocean. If an additional 189,000 workers are employed at the average weekly earnings of £21, about £4,000,000 a week will have to be found to pay the wages bill or £208,000,000 over a full year. I do not know whether the Government expects that the private sector of the economy will be able to find that amount over a period, and particularly a period like the one through which we are now passing, when there is no confidence in the business sector.
– Because of whom? The Menzies Government?
– Because of the economic policies adopted during 1960 - not solely the measures brought down on 15th November, 1960. One must take into con sideration the measures of November, 1960. If the private sector of industry cannot provide the 189,000 jobs and cannot provide the £208,000,000 wages packet for the whole year, then the responsibility must fall on the public sector of the community. But the Government has said that at the most the deficit for the coming year will be £60,000,000. The Government proposes to spend only £60,000,000 for the relief of unemployment over and above the amount for which it budgeted in August last year. The result is that the private sector of the! economy must find about £150,000,000. Does the Government really believe that the private sector of the economy will be able to find that amount of money over a period of twelve months? The Government’s policy of infusing a small amount of money over a short period of time in order to improve the employment position is out-dated as an economic theory. That is a policy that the world’s economists say should not be pursued. If you want to infuse money into the public sector of the economy you must have a steady stream of money passing through.
Debate interrupted.
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– - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -
That the Senate do now adjourn.
Question resolved in the affirmative.
Senate adjourned at 10.30 p.m.
Cite as: Australia, Senate, Debates, 3 April 1962, viewed 22 October 2017, <http://historichansard.net/senate/1962/19620403_senate_24_s21/>.