Senate
9 November 1964

25th Parliament · 1st Session

  1. Senate
  2. 25th Parliament
  3. 1964

The DEPUTY PRESIDENT (Senator McKellar) took the chair at 2.30 p.m., and read prayers.

page 1507

ASSENT TO BILLS

Assent to the following Bills reported -

Parliamentary Allowances Bill 1964. Ministers of State Bill (No. 2) 1964. Parliamentary Retiring Allowances Bill 1964. Appropriation Bill 1964-63. Appropriation (Special Expenditure) Bill 1964-65. Salaries (Statutory Offices) Adjustment Bill 1964.

Sales Tax Bills (Nos. 1 to 9) 1964.

Loan (Housing) Bill 1964.

Loan (War Service Land Settlement) Bill 1964.

Migration Bill 1964.

Australian Coastal Shipping Commission Bill 1964.

Dried Fruits Export Control Bill 1964. Dried Fruits Export Charges Bill 1964. Law Officers Bill 1964.

page 1507

QUESTION

TAXATION

Senator McKENNA:
TASMANIA

– My question is directed to the Minister representing the Treasurer. Will he ask the Treasurer to say, before the Bill designed to prevent tax avoidance is debated, whether he considers there is substance in that portion of the article by Mr. Carnegie R. Fieldhouse published in the “ Sydney Morning Herald “ on Friday, 6th November last, quoting instances of what the writer claims to bc grave defects in the Bill?

Senator HENTY:
Minister for Civil Aviation · TASMANIA · LP

– I have discussed this matter with the Treasurer, who has advised me that the alleged defects referred to in the newspaper article have been examined by the Treasury. He has also advised me that the aspects referred to are adequately provided for in the proposed legislation; in fact, there are no defects as alleged by the writer.

page 1507

QUESTION

SHEEP

Senator LILLICO:
TASMANIA

– I wish to address my question, which relates to the Commonwealth Scientific and Industrial Research Organisation, to the Minister representing the Minister for Primary Industry. I ask: Is the Minister aware of the incidence of foot abscess in sheep in Tasmania, reported to cause a 5 per cent, death rate in some flocks? If it is not already so engaged, will the C.S.I.R.O. investigate methods of prevention and cure of this disease because, so far as I can ascertain, no authority seems able to advise sheep owners as to what effective action can be taken?

Senator ANDERSON:
Minister for Customs and Excise · NEW SOUTH WALES · LP

– I will have the honorable senator’s question forwarded to the Minister for Primary Industry. Matters which relate to the C.S.I.R.O. are, of course, the concern of another Minister, but as this subject is of general interest in the field of primary industry, I am sure that the Minister for Primary Industry would wish to have the question before him, as well as having it referred directly to the C.S.I.R.O.

page 1507

QUESTION

DEFENCE

Senator BROWN:
QUEENSLAND

– I wish to ask the Minister for Defence the following pertinent questions - 1. Is it the general consensus of opinion in Australia that our defences arc deplorably weak? 2. Should the full truth of this weakness be told? 3. Did not the Government, a year or two ago, appoint Lieutenant-General Sir Leslie Morshead as chairman of a special committee to review the organisation of the defence group of departments? 4. Was a report received?

  1. If so, what was the nature of the report?
  2. Was the report ever made public? 7. Did the Government act on the report?
Senator PALTRIDGE:
Minister for Defence · WESTERN AUSTRALIA · LP

– Answering the questions as the honorable senator asked them, I say that it is certainly not the concensus of opinion that the defences of Australia are in a weak condition. All who have sufficiently interested themselves to direct their minds to this matter are only too ready to concede that, as circumstances have changed over the years, so the Government’s approach to the problem has changed. Its defence policy including its policy in relation to the provision of equipment has changed as circumstances have demanded. May I take the opportunity to tell Senator Brown that the flexible approoch to the whole problem of defence will be continued. Wc do not see defence as a problem which can be solved in the Socialist manner of working out a fixed plan and adhering to it. We acknowledge that circumstances alter both the degree and the ntaure of the defence effort which has to be made. We have directed our defence effort accordingly and will continue to do so.

The honorable senator asked whether Sir Leslie Morshead was the chairman of the committee which, some years ago, presented a report on the organisation of the forces. Yes, that is so. The committee reported to the Government. The report of the committee was of a completely confidential nature. It was made to the Government by a committee which the Government had appointed for the purpose of reporting to it. The report received the close consideration of the Government and, as a result many modifications of and alterations to, the Australian defence set up were made.

page 1508

QUESTION

DRUGS

Senator ANDERSON:
LP

– I have seen the report to which the honorable senator has referred. I understand that the Acting Minister for Health is examining the general subject matter raised by the honorable senator. At this stage I am able to say that the drug mentioned by him is not available at present in Australia but is being evaluated by the Australian Drug Evaluation Committee. It may be appropriate to indicate that this is a body which was appointed in June 1963 and consists of a group of eminent medical people whose function it is to report upon the safety of drugs generally and to evaluate special drugs referred to the Committee by the Director-General of Health. The Chairman of the Committee is Dr. Edgar Thomson, who is General Superintendent of the Royal Prince Alfred Hospital, Sydney; and the members are Sir William Morrow, an eminent specialist in Sydney; Sir Clive Fitts, of Melbourne; Professor Hugh Robson, Professor of Medicine in the University of Adelaide; Professor

Robert Whelan, Professor of Human Physiology and Pharmacology in the University of Adelaide; Dr. Robertson of Sydney; and Dr. Radford of Coogee, New South Wales. As I have said, the Committee is examining the drug at the present time and will make a report to the Acting Minister for Health in relation to it.

page 1508

QUESTION

DEFENCE

Senator SANDFORD:
VICTORIA

– I address a question to the Minister for Defence. I ask: Is it a fact that there is only one radar station operating in Australia and that it is located at Sydney and works on a 9 a.m. to 5 p.m. basis? If that is not correct, how many other radar stations are in operation, and what are their locations?

Senator PALTRIDGE:
LP

– The question is one more for the Minister for Air than for myself. I can assure the honorable senator that there is more than one radar station in Australia. A station that immediately springs to mind is that at Darwin. The radar stations are operated in a manner and at times which, in the opinion of the people who are charged with the responsibility for our defence, are most suitable.

page 1508

QUESTION

TELEPHONE SERVICES

Senator BUTTFIELD:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Postmaster-General. Is the Minister aware that some time ago I made representations to the Postmaster-General, requesting the installation of a radio telephone trunk line from Andamooka and also from Coober Pedy in South Australia to replace the very limited service at present available only to Andamooka through the Royal Flying Doctor Service? Would the Minister endeavour to let me know before the end of this Parliamentary session whether the Postmaster-General has been able to make satisfactory arrangements for providing an adequate telephone service to these two opal mining towns?

Senator ANDERSON:
LP

– I will raise this matter with the Postmaster-General today, in the hope that I will be able to get the information that the honorable senator requires before the Parliament goes into recess.

page 1508

QUESTION

DEFENCE

Senator HANNAN:
VICTORIA

– Has the Minister for Defence had an opportunity to read the

Australian Labour Party’s speakers’ notes for iiic 1961 election campaign? If so, has he observed that although in this voluminous publication reference is made to unemployment, housing and other matters, the word “ defence “ is not mentioned? Does this mean that the Australian Labour Party had no defence policy in 1961? If it had not heard of defence as recently as 1961, is the Minister able to venture an explanation of the sudden synthetic interest in the subject now being displayed by honorable senators opposite?

Senator PALTRIDGE:
LP

– I am sure that at about the 1961 election period my reading would have included the policy speech delivered by Mr. Calwell. I am not so sure that I had an opportunity to look at the speakers’ notes.

Senator Ormonde:

– I will send the Minister a copy.

Senator PALTRIDGE:

– Very well. I will be pleased to add it to my already voluminous library. I should need a comprehensive cross index to enable me to find what is consistent in the Labour Party’s policy from year to year in view of the fact that there is so much that is inconsistent. Of course, every one is aware that Labour’s interest in defence quickens as it perceives the possibility of gaining some political advantage from the subject, lt is only a couple of elections ago - every one will recall this - that Mr. Calwell was whining for the recall of Australian troops from Malaya. As this election campaign proceeds, it will be of great satisfaction to me and to all honorable senators who sit behind mc to read what various prominent members of the A.L.P. have said about defence over the last few years and to ask the public to try to reconcile the stand of the A.L.P. over the last few years with what has been described quite accurately as the synthetic interest which it now shows in defence.

page 1509

QUESTION

TRAINING OF ARMY OFFICERS

Senator MCCLELLAND:
NEW SOUTH WALES

– I direct my question to the Leader of the Government in the Senate. Are nominations now being called for admission to courses to be conducted next year at the Army Staff College in Victoria for the training of Army officers? Have Indonesian Army officers been receiving training at the College along side Australian and Malaysian personnel? Does the Government intend to make positions available for Indonesians at the College next year?

Senator PALTRIDGE:
LP

– It is true that for some years there has been some reciprocity between Australian defence establishments and the defence establishments of South East Asian countries and that, in pursuance of the policy of reciprocity, some Indonesian servicemen have received training at Australian establishments. Their applications for these courses are considered entirely on their merits and in the light of circumstances existing at the time. That has been the policy in the past, lt will be pursued in the future.

page 1509

QUESTION

DEFENCE

Senator WRIGHT:
TASMANIA

– I ask the Leader of the Government in the Senate, in his capacity as Minister for Defence, whether he noticed statements that emanated from the Leader and Deputy Leader of the Australian Labour Party over the weekend on the subject of defence, and whether he would comment upon the criticism of the Government’s five yearly review policy, the TFX aircraft, and suggestions that he is not in close liaison with his defence advisers.

Senator PALTRIDGE:
LP

– I did notice in this morning’s Press the reports of what was said in the weekend by the Leader of the Opposition and by the Deputy Leader of the Opposition in another place on (he subject of defence. I noted those points carefully, and I should like to comment on each of them, if I may. Mr. Calwell said, critically, that there had been five defence reviews in five years. I put it to him that this should not surprise anyone aware of the changing situation that has occurred and the need to keep our defence position constantly under review. The number of defence reviews which have taken place would, 1 think, reflect the continuing concern in respect of defence matters which the Government feels, and its flexible approach to defence matters. If Mr. Calwell is surprised at the number of reviews which have taken place in the past, I give him warning that he will be more surprised in the future as the Government continues its policy of meeting the changing scene and giving defence its constant and close attention. It probably surprises Mr. Calwell to know that our last two reviews have increased defence expenditure by 38.6 per cent, over the period of two years.

Senator Cant:

– ‘What defence has it given us?

Senator PALTRIDGE:

– If the honorable senator, who interjects from ignorance rather than from knowledge, wants to comment on this matter, he will have an opportunity to do so and, particularly in view of his stand on the North West Cape project, we honorable senators, and his Western Australian constituents in particular, will be delighted to hear what he says. Mr. Calwell went on to say that the TFX deal had been bungled, leaving Australia’s air defence dependent upon the Canberra aircraft. There is no doubt about Mr. Calwell’s own consistent bungling in respect of his failure to grasp the true situation. He has said this before and he has been confounded many times.

The fact of the matter is that the TFX bomber, the last word in modern strike aircraft, will begin to arrive in Australia in 1968, a full two years before the Canberra will begin to be phased out of service. To call the Canberra obsolete is pure nonsense, and it does not surprise me that Senator Cant contributes to the nonsense. The Canberra is still a most useful operational aircraft; it is in use in many countries. Does Mr. Calwell forget that Britain recently reinforced its own air forces in Malaysia with Canberra bombers? Does he forget that the Americans in Vietnam use the B57 bomber, the American version of the Canberra? He said that the present neglect of the defence forces in respect of expenditure was something about which the Government should be criticised. Regarding his assertion on defence neglect, it is significant that in this current year the Government is already spending nearly six times as much as Labour did when last in office. It is further significant that Labour’s own defence budget was actually falling year by year. Between 1947 and 1949-50, its defence expenditure fell from £71.6 million to £54.2 million.

The Deputy Leader of the Opposition commented critically on the fact that the Service departments, as he said, had had 35 Ministers in 15 years. I point out that this number is only one less than the 36 faceless men who look after the defence policy of the A.L.P. The generalisations that the Deputy Leader of the Opposition has made are all very well but let us have a look at the facts concerning the appointment of Ministers for Defence. In the past 15 years, two Ministers have served a total of 13 years. The first of them, Sir Philip McBride, retired at the age of 66 years after 8 years in office and the second, Mr. Athol Townley, served for 5 years until his death in December last year.

Mr. Whitlam also said that there had been insufficient contact between responsible Ministers and their Service advisers. This is just plain rubbish and the Deputy Leader of the Opposition knows it. If he does not know it, he should keep quiet. The Service Ministers are in constant touch with their Service advisers and hold regular consultations with them almost daily.

The Deputy Leader of the Opposition said that the Minister for Defence in Australia saw less of the Chiefs of Staff than the Secretaries for Defence in Great Britain and the United States of America. I can only say that the responsible Ministers in Great Britain and the United States of America must virtually live with their Chiefs of Staff if they see more of their military advisers than I have in the past six months.

Mr. Whitlam also said that the Defence Committee was heavily weighted by civilians who were senior to the Chiefs of Staff. I point out that half the members of the Defence Committee are Service chiefs. The civilian members are experts in vital fields pertaining to Defence. They are Mr. E. W. Hicks, Secretary of the Department of Defence; Sir Roland Wilson, Secretary to the Treasury; Sir Arthur Tange, Secretary of the Department of External Affairs; and Sir John Bunting, Secretary of the Prime Minister’s Department. The Deputy Leader of the Opposition said that there had been lack of co-ordination between the Government’s defence and foreign policies. My reply is that this co-ordination takes place on all levels as the very membership of the Defence Committee alone clearly demonstrates.

Mr. Whitlam further stated that the Government had failed to maintain naval shipbuilding in Australia and had left the Navy without docking facilities on the west coast. My comment is that the facts on shipbuilding speak for themselves. In the past few years, nine major warships have been built in Australia and three more are currently in the course of construction. In addition, the Navy this year took delivery of a £2 million survey ship from the Newcastle State Dockyard, in addition to numerous smaller craft from naval and private yards. As well as the extensive new construction, there is the regular demand on naval shipyards for maintenance and refitting. The Deputy Leader of the Opposition also stated that the Government was in a state of confusion over defence. The fact is that Mr. Calwell and Mr. Whitlam are well qualified to talk about confusion. As usual the Opposition is cartwheeling. Recently, Mr. Calwell implied that the Government was not spending enough money on defence, yet two elections ago he claimed that defence expenditure was “pouring money down the drain”. Confusion on the part of the Australian Labour Party is synonymous with its backing and filling on the North West Cape naval communication base and party disunity over Australia’s role in Malaya.

Senator Cant:

– I rise to a point of order. Is the Minister for Defence giving the Senate the Government’s statement on defence now instead of presenting it later?

The DEPUTY PRESIDENT.- Order! There is no substance in the point of order.

Senator PALTRIDGE:

– I was merely saying, Mr. Deputy President, that this state of confusion is synonymous with the Labour Party’s own confusion as shown by its backing and filling on the North West Cape naval communication base which should be of particular interest to Senator Cant who hails from Western Australia. This is synonymous with the Labour Party’s disunity over Australia’s role in Malaysia and its inability to determine its views on what should or should not be done in Vietnam.

Senator SANDFORD:

– The Minister for Defence has criticised the Australian Labour Party on its defence policy. Will he now, for the edification of the Senate, detail the happenings in 1941 when, after being in office for two years in a period of total war, the present Prime Minister failed dismally to retain the confidence even of his own Party, and the prosecution of Australia’s part in the Second World War devolved upon Mr. John Curtin, as leader of the Australian Labour Party?

Senator Prowse:

– What about the Duke of Wellington?

Senator Hannan:

– What about Caesar’s Gallic Wars?

Senator SANDFORD:

– The honorable senator would be better at home dealing with Oliver Cromwell for whom he has a violent dislike. Will the Minister tell us of the happenings of the 7th October 1941, when Sir Robert Gordon Menzies, as he now is, deserted in the face of the enemy?

Senator PALTRIDGE:

- Mr. Deputy President-

Senator Cant:

– Has the Minister a written reply to this question?

Senator PALTRIDGE:

– No, but I can give chapter and verse. If the honorable senator provokes me, I will do so. Anyone who has any knowledge of the departure of the Menzies Government from office in 1941 will recall that this was brought about by the votes of two independent members. Those votes made it possible for the then Labour Opposition to form a government. No action was taken against the Menzies Government on the score of alleged neglect of the defence issue. Indeed, probably the best commendation that could have been made of the war effort of the Menzies Government up to the time when it was forced out of office was made by the succeeding Prime Minister, Mr. John Curtin. Immediately on assuming office in 1941, he made a public statement to the effect that everything that could have been done in the first two years of the war to strengthen Australia and to make possible a defence effort had been done by the retiring Government. That statement was made by Mr. John Curtin himself.

page 1511

QUESTION

AVIATION

Senator LAUGHT:
SOUTH AUSTRALIA

– Has the attention of the Minister for Civil Aviation been directed to a full page advertisement in today’s issue of the “ Australian “, purporting to reproduce a letter from the chairman of the board of the Interstate Parcel Express Co. in which he complained of the Government’s method of considering an application to the Department of Civil

Aviation for facilities to enter into the carriage of interstate air freight? Will the Minister inform the Senate of the nature of the application and of the circumstances surrounding its consideration by the Government?

Senator HENTY:
LP

– I saw the advertisement to which the honorable senator has referred. The reference in the letter to a delay of over 12 months is grossly inaccurate, because the application was not received ‘by the Department of Civil Aviation until 21st July 1964. Just as inaccurate is the statement that the directors endeavoured to arrange a meeting with me, as the Minister for Civil Aviation, in July 1963. I became the Minister for Civil Aviation only in June 1964. The service to Tasmania which the letter states the company is running with DC3 aircraft is being conducted by aircraft owned and flown under charter by the Tasmanian charter firm of Brown and Brain of King Island, Tasmania. The letter refers to the Department following its normal practice of confirming the solvency of an applicant for a licence and the ability of the applicant adequately to finance the undertaking. I was advised that the subscribed capital of this company was £300, so I felt thoroughly justified in calling for a financial check. The investigation established the fact that the organisation was financially sound. This is not the only applicant for a licence to enter a trunk line route freighter service with imported aircraft. The applications are at present under consideration by the Government.

page 1512

QUESTION

NORTH WEST CAPE

Senator CANT:

– My question is directed to the Leader of the Government in the Senate. Is it a fact that United States representatives in Western Australia have denied any statements that there is a colour bar at the North West Cape construction site? Is it a fact that Hardeman Monier Hutchinson, the constructing engineers at the site, have also denied that there is a colour bar? Can the Minister tell the Senate whether a colour bar on native transport drivers exists at North West Cape?

Senator PALTRIDGE:
LP

– I am not aware of the situation as described by the honorable senator. I did not know, for example, that there had been need for the United States representatives, or that they felt that there had been need, to deny that there had been a colour bar any more than I had known that Hardeman Hutchinson Monier had denied that there had been a colour bar. AH I can say to the honorable senator is that I will have a look at the matter and see what the background to his question is. I will certainly let him know whether there is or is not any substance in it, and, if there is substance in it, what is being done in respect of the matter.

page 1512

QUESTION

CIVIL AVIATION

Senator MARRIOTT:
TASMANIA

– Has the Minister for Civil Aviation read an advertisement in a section of the Tasmanian Press that indicates that Trans-Australia Airlines will introduce a Boeing 727 whispering jet service between Sydney and Hobart as from 19th December? Will Llanherne airport, which serves Hobart, be able to accommodate Boeing 727 jets by 19th December? If it will, is Ansett-A.N.A. to operate a similar service between Sydney and Hobart? If so, when?

Senator HENTY:
LP

– I have not read any advertisements to the effect that TransAustralia Airlines proposes to run a Boeing 727 jet service from Sydney to Hobart to commence on 19th December. The airstrip at Hobart would not be fit for a regular 727 service by that time. Approximately £248,000, 1 think, is to be spent on this strip in the future for the purpose of strengthening it so that it will be able to take an Electra service and occasional 727 services. But to the best of my knowledge this strip is not fit at the moment to take regular Boeing 727 services as suggested. I have no knowledge as to whether Ansett-A.N.A. proposes to run a Boeing 727 service to Hobart.

page 1512

QUESTION

EDUCATION

Senator COHEN:
VICTORIA

– In the absence of the Minister in Charge of Commonwealth Activities in Education and Research, I address my question to the Leader of the Government in the Senate. Has the Minister seen reports in this morning’s “Age” that the Victorian Secondary Teachers Association and the Victorian Teachers Union have condemned the Federal Government’s delay in dealing with the report of the committee on tertiary education? In view of the serious financial and accommodation difficulties facing universities, and the massive apprehension in the universities and the community about the future of tertiary education, can the Minister give the Senate some reasonable indication as to when the Government will be making up its mind about the report? In the meantime, is there any good reason why the report should not be made public so that the universities and other educational authorities may have an opportunity to study and discuss it?

Senator PALTRIDGE:
LP

– It might be as well to recall that the committee referred to was set up by this Government. It can be assumed that the Government, having set up the committee, will receive and give complete consideration to its report. The position at the moment, as I understand it, is that the report, which is likely to be one of great bulk, has been presented only in part. The Prime Minister, when answering a question on this matter recently, indicated that neither he nor his Ministers had been able to give it close attention. He also indicated, as I do now, that as soon as the complete report is submitted and is considered the Government will announce what action it proposes to take.

page 1513

QUESTION

CIVIL AVIATION

Senator WRIGHT:

– -I address to the Minister for Civil Aviation a question which, too, concerns the open letter in this morning’s “ Australian “ about an application by the l.P.E.C. organisation for an air freight licence. I want to know whether or not the reason why the company applied for a licence to operate its own air service and to import its own aircraft was that it wanted to carry on a service which it is now possible for it to carry on only by chartering aircraft from Brown and Brain. I want to know whether there is any truth in the statement that, since this application was first submitted to the Department of Civil Aviation, Trans-Australia Airlines has reduced its air freight charges, with the result that it will have an advantage in competition with this applicant for an air freight licence.

Senator HENTY:
LP

– The application was designed to enable the company concerned to acquire its own aircraft and to operate a service to Tasmania in replacement of the present charter air service operated by the Tasmanian firm of Brown and Brain. The honorable senator asked me whether air freight charges to Tasmania had been reduced. I understand that that is so and that that action followed the submission of the 1963 annual report of the Department of Civil Aviation, when the Minister called attention to the fact that the existing trunk line operators were not obtaining sufficient growth of air freight and called for a stepping up of air freight. I understand that that result has been achieved.

page 1513

QUESTION

PHARMACEUTICAL BENEFITS

Senator FITZGERALD:
NEW SOUTH WALES

– Is the Minister representing the Acting Minister for Health aware that the drug synermycin which has helped to save the lives of many babies and aged people, has been withdrawn from the Commonwealth pharmaceutical benefits list? Is the Minister aware that synermycin is no longer available at the rate of 5s. for each prescription but carries a charge of £3 or more, which is beyond the reach of people in modest circumstances? In view of the fact that a social security tax is levied and in view of the moral responsibility of the Government, will the Minister, as a matter of great urgency, request that this drug, which is prescribed extensively by the medical profession for both young and old, bc restored to the pharmaceutical benefits list?

Senator ANDERSON:
LP

– I shall certainly draw the attention of the Acting Minister for Health to the honorable senator’s question. I make the observation that, if a certain drug has been withdrawn from the list, it would be because there were other drugs on the list which performed a similar function.

Senator Fitzgerald:

– But not as good as this one.

Senator ANDERSON:

– Dr. Fitzgerald says: “ Not as good as this one “. He sees it as being a little different. However, I am now being a little flippant. I inform him that as a general rule, if a drug is withdrawn, the reason is that, in the judgment of the committee, there are other drugs on the list which will fulfil the same purpose. However, I will refer the honorable senator’s question to the Acting Minister and obtain an answer for him.

page 1514

QUESTION

THE PARLIAMENT

Senator MARRIOTT:

– I ask the Leader of the Government in the Senate whether he will announce, as soon as is convenient, the arrangements that have been made for the broadcasting of the proceedings of the Parliament, both in the Senate and in another place, during the current week. I also ask him whether the Senate’s rights have been safeguarded.

SenatorPALTRIDGE. - The proceedings of the Parliament during this week will be broadcast as follows - The House of Representatives on Monday, Tuesday and Thursday; the Senate on Wednesday and Friday. I believe that the rights of the Senate have been preserved.

page 1514

QUESTION

CIVIL AVIATION

Senator WRIGHT:

– I wish to ask another question of the Minister for Civil Aviation about the I.P.E.C. application. The first part of my question arises from a reference made by the Minister in his reply to my previous question. First, am I not correct in understanding that the application is for a licence to operate between all capital cities of the Commonwealth, and not merely with respect to Tasmania? Secondly will the Minister say when a definite answer to the application will be given?

Senator HENTY:
LP

– The application is for the importation of five aircraft to operate between all capital cities of Australia. I referred to the Tasmania situation only because the company implied in a letter that it was compelled to operate with obsolete DC3 aircraft. I was pointing out that the company did not own the DC3 aircraft. They are owned by a Tasmanian firm. The application is for a licence for five aircraft to travel to all capital cities. I am unable to state a definite time at which the application will be dealt with. I can say only that it is actively before the Government at this moment.

page 1514

QUESTION

DEFENCE

Senator McKENNA:

– I direct a question to the Minister for Defence. Will the honorable senator, before the Senate next discusses the subject of defence, indicate whether there are any omissions - and if so, what omissions - from the list which I have had prepared of statements on that subject made by or on behalf of the

Government since 19th December 1949? With the concurrence of honorable senators I incorporate the list in “ Hansard “.

  1. 20th, 22nd, 25th September and 1st October, 1950.- “The Defence Call to the Nation”, series of three broadcasts by the Prime Minister.
  2. 28th September, 1954.- Statement by Sir Phillip McBride.
  3. 20th April, 1955. - “ Foreign Affairs and Defence “. Ministerial statement by Prime Minister.
  4. 4th April, 1957- “ Australian Defence”.Statement by Prime Minister.
  5. 2nd May, 1957. - Defence Review - Statement by Sir Phillip McBride.
  6. 19th September, 1957. - Further Defence Statement by the Prime Minister.
  7. 19th March, 1958.- “ Defence Organization” - Statement by Prime Minister.
  8. 26th November, 1959. - Defence Review - Hon. A. Townley - New three year programme.
  9. 29th March,1960.- Defence Review- Hon. A. Townley.
  10. 11th November, 1960. - Statement on Defence by Hon. A. Townley during Estimates Debate.
  11. 29th June, 1961.- “The Navy Programme” - Ministerial Statement by Hon. A.

Townley released to Press on 29.6.61.

  1. 5th October, 1961. - Statement on Defence by Hon. A. Townley during Debate on Estimates.
  2. 24th October, 1962. - Statement on Defence by Hon. A. Townley - New three Year programme.
  3. 22nd May, 1963.- Defence Review- Ministerial Statement by Prime Minister.
  4. 24th October, 1963. - Ministerial Statement by Prime Minister on Royal Australian Air Force.
  5. 18th June, 1964. - Defence Review by Senator Paltridge.
Senator PALTRIDGE:
LP

– I shall be pleased to study the list and ascertain whether any ministerial statements on defence have been omitted.

page 1514

QUESTION

AUSTRALIAN BROADCASTING COMMISSION

Senator McCLELLAND:

– Has the Minister representing the PostmasterGeneral seen reports that three officers of the Australian Broadcasting Commission connected with the programme “ Four Corners “ have been removed from their positions? In view of the outstanding success of the team concerned, the popularity of the programmes it was producing for Australian television viewers, and the great concern of many thousands of irate people that these men have been dismissed because of political influence, will the Minister use whatever influence he has with the A.B.C. to have them restored to the positions they were occupying competently, effectively and to the satisfaction of television viewers?

Senator ANDERSON:
LP

– I shall refer the honorable senator’s question to the PostmasterGeneral. However, I would like to repudiate without delay any suggestion of political interference with the Australian Broadcasting Commission. The position is that the Commission, by Act of Parliament, has complete autonomy. The honorable senator’s suggestion to the contrary reveals that he is not aware of the law. However, I shall refer the honorable senator’s question to the Postmaster-General and obtain an answer for him as soon as I can.

page 1515

QUESTION

CITRUS INDUSTRY

Senator LAUGHT:

– I direct a question to the Minister representing the Minister for Primary Industry. In the light of the fact that there are indications that the citrus industry in South Australia could achieve an orderly marketing system on a State level in the near future, to the great benefit of citrus glowers in South Australia, will the Minister for Primary Industry make a close study of the industry on a Commonwealth level so that he may be able to gauge the first moment when it is appropriate to consider the introduction of a Commonwealth stabilisation scheme?

Senator ANDERSON:
LP

– I shall refer the honorable senator’s question to the Minister for Primary Industry. I point out, however, that any stabilisation scheme requires the co-operation not only of, the growers and the Commonwealth Government, but also that of State Governments. To secure this co-operation is a process which takes a considerable length of time, as we have found in relation to other industries. The matter that the honorable senator has raised is of considerable interest and I shall refer it to my colleague without delay.

page 1515

QUESTION

PUBLIC SERVICE

(Question No. 245.)

Senator MORRIS:
QUEENSLAND

asked the Minister representing the Prime Minister, upon notice -

  1. Does the Commonwealth Public Service Act require all prospective employees, including nonBritish persons, to make and subscribe an oath or affirmation of allegiance to the Crown?
  2. Does the oath or affirmation, as it applies to non-British persons, require or include any renunciation of foreign nationality?
Senator PALTRIDGE:
LP

– The Prime Minister has provided the following answers to the honorable senator’s questions -

  1. Sections 34 and 82 of the Public Service Act 1922-1964 require that permanent appointees and temporary employees in the Commonwealth Public Service take an oath or affirmation of allegiance to the Queen.
  2. The oath or affirmation docs not in terms require or include any renunciation of foreign nationality. I do not, however, express any view on the effect, under the relevant foreign law, of the taking of any such oath or the making of any such affirmation upon the foreign nationality of the person accepting employment with the Commonwealth.

page 1515

QUESTION

TRAVEL TO COMMUNIST COUNTRIES

(Question No. 303.)

Senator HENDRICKSON:
through Senator Poke

asked the Minister representing the Prime Minister, upon notice -

  1. Have Australian passport restrictions on travel to Communist countries been abolished and is it now unnecessary for Australians who wish to travel to those countries to make a separate application to the Department of Immigration?
  2. What were the reasons for the change?
  3. Is the change to be taken as an indication that the Australian Government proposes to fall into line with Great Britain on the contentious question of recognition of Communist China, particularly in the light of the fact that mainland China is becoming Australia’s best customer so far as wheat and wool are concerned?
Senator PALTRIDGE:
LP

– The Prime Minister has provided the following answers to the honorable senator’s questions - 1 and 2. The new Australian passport introduced in July of this year contains a printed entry making it valid for all countries. This was one of a number of changes introduced to speed up the preparation of passports and facilitate inspection by entry control officers, both in Australia and abroad. Prior to the introduction of the new passport, the practice was to insert a stamp stating that the passport was not valid for travel to Communist countries; however, if the applicant desired to visit such a country, an endorsement was made by hand and in practice Australian passports were made valid for all countries the holder wished to visit. However, it should be appreciated that a passport is not a permit to visit any country, or a document prohibiting a visit to any country; each country determines for itself what persons it will or will not admit, irrespective of what authorisations or limitations are made in their passports.

  1. No.

page 1516

QUESTION

AUSTRALIAN ECONOMY

(Question No. 309.)

Senator CAVANAGH:
SOUTH AUSTRALIA

asked the Minister representing the Prime Minister, upon notice–

  1. Can the Prime Minister supply any information on the Committee of Economic Inquiry set up by the Government in February 1963 and known as the Vernon Committee? 2.How far has the Committee proceeded in its inquiry; how many times has it met; and when can a report from the Committee be expected?
Senator PALTRIDGE:
LP

– The following answer is now supplied -

In answer to the honorable senator’s question, I would refer him to the reply given by Senator Henty on 24th September to a similar question directed by Senator McClelland to the Minister representing the Treasurer. This answer is set out on pages 703 and 704 of “Hansard” of 24th September 1964.

page 1516

QUESTION

ATOMIC ENERGY

(Question No. 330.)

What proportion of the total power requirements of England and Wales is being supplied by atomic power?

What is the corresponding figure for Scotland?

Is there any information available to show the estimated cost per Kilowatt hour of the power which will become available from the Dounreay nuclear power station?

Senator PALTRIDGE:
LP

– The following answer is now supplied -

  1. By the end of 1964 there will be approximately 2,060 megawatts of nuclear power plant in operation in England and Wales. This figure includes the United Kingdom Atomic Energy Agency’s dual purpose Calder Hall stations and the small prototype Windscale A.G.R. plant, and represents a little over 6 per cent. of the maximum demand expected this winter. Because the nuclear stations will operate on base load the proportion of energy supplied will be somewhat higher than this - about 9 per cent. based on next year’s requirements.

In addition to the above, there is a further 2,740 MW of nuclear plant under construction in England and Wales, all of which will be in operation by mid-1969 bringing the total installed capacity to approximately 4,800 MW. This will represent about 9 per cent. of the peak demand and 13 per cent. of the total electricity production at that time. Early this year the British Government announced its second nuclear power programme covering the installation of a further 5,000 MW of plant between 1970 and 1975. Tenders for the first station under this programme have already been invited. Hence by 1975 some 10,000 MW of nuclear power plant arc planned for operation representing about 12 per cent. of the estimated peak demand and about 18 per cent. of the total electrical output. After 1975, the proportion of nuclear generation is expected to increase rapidly.

  1. There is only one civil nuclear power station in operation in Scotland; this has a rating of about 320 MW. The South of Scotland Electricity Board, however, receives about 175 MW of power from the U.K.A.E.A.’s dual-purpose Chapel Cross station and the Northern Board also receives some power from the Dounreay plant. The total contribution by nuclear power is therefore about 500 MW compared with an estimated peak demand this year of about 3,800 MW. Nuclear power therefore, accounts for about 13 per cent. of the power and 23 per cent. of the energy requirements on the basis of this year’s estimates. No other stations are under construction in Scotland at present, but it has been indicated that one, probably of 1,000 MW, will be built during the 1970-1975 period. Hence by 1975 when the combined system demand is expected to reach 7,700 MW, about 20 per cent. of the power requirements and 33 per cent. of the energy requirements could be nuclear.
  2. The Dounreay reactor was designed originally as a small fast breeder power demonstration unit and commenced operating in late 1961. Since that date, however, it has been modified extensively and although it has operated and produced its design output of 15 MW for extended periods, it is now regarded essentially as an experimental facility for the development and testing of fuel elements and other components for future fast breeder reactors. No generation cost figures are available but, in any case, being a small experimental facility, any such figures would be meaningless in the context of commercial power generation. It is generally believed that fast breeder reactors must be built in very large sizes - 500 to 1,000 MW or more - to be economical. Although the U.K.A.E.A. has announced its intention to seek approval to build a prototype fast breeder plant next year, it is not expected to be competitive. Commercially competitive stations of this kind are not expected to be commissioned until about 1980.

page 1516

QUESTION

URANIUM OXIDE

(Question No. 331.)

Did South Africa recently make a sale of a substantial quantity of uranium oxide?

If so, what information is available concerning the transaction; to whom was the oxide sold; what was the price obtained and what was the quantity sold? 3.Is there any change in the view that it may be 1969 or 1970 before the uranium market revives?

Senator PALTRIDGE:
LP

– The Minister for National Development has supplied the following answers - 1 and 2. 1 have no knowledge of a recent sale of a substantial quantity of uranium oxide by South Africa. The annual reports of the South African Atomic Energy Board mention sales of small quantities of uranium to Japan, Sweden,

Israel and Brazil during the past three years. Little information is available about these sales. It is known that 13 short tons of uranium oxide were sold to Japan in 1962 at a price of 3.65 United States dollars. Sales to Israel total 10 metric tons of uranium oxide but the price has not been revealed. 1 am not aware of the details of the other transactions referred to, except that it is known that the quantities involved were small.

  1. There are some indications of a quickening interest in the uranium market. The current known reserves of uranium are unlikely to be adequate to meet the expected substantial increase in demand arising from planned programmes for the introduction of nuclear power. Therefore, potential large-scale users of uranium, particularly in Europe, are showing some anxiety for resumption of exploration. However, it is unlikely that there will be a significant increase in the consumption of uranium for nuclear power generation before the early 1970’s and there is no significant change in the forecast that it may be 1969 or 1970 before the uranium market revives.

page 1517

MINISTERIAL ARRANGEMENTS

Senator PALTRIDGE:
Minister for Defence · Western Australia · LP

– by leave - I wish to inform the Senate that the Minister for Air (Mr. Howson) left Australia on Friday last, 6th November, to lead the Australian parliamentary delegation to the Commonwealth Parliamentary Association conference at Kingston, Jamaica, and to undertake Government business in various other centres. He will be away until 14th December. During his absence the Minister for Supply (Mr. Fairhall) will act as Minister for Air.

page 1517

ASSENT TO BILLS

Assent to following Bills reported -

Defence Bill 1964.

Naval Defence Bill 1964.

Air Force Bill 1964.

page 1517

AIR NAVIGATION (CHARGES)

Bill returned from the House of Representatives without amendment.

page 1517

REPRESENTATION BILL 1964

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Anderson) read a first time.

Second Reading

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– I move -

That the Bill be now read a second time.

The main purpose of this Bill is to give a State an additional member in the House of Representatives for any fraction of a quota in lieu of a member for a remainder greater than one-half of the quota. This Bill, though of importance, is short in compass and can be shortly and simply stated. First, however, I think I should set out briefly the history leading up to the proposed amendments.

Following the taking of the 1961 census, the Chief Electoral Officer, as required by law, determined the number of members to be chosen in the several States. As honorable senators would be aware, the procedure for determining the number of members is found in section 10 of the Representation Act. This section requires that the quota shall be ascertained by dividing the number of the people of the Commonwealth by twice the number of senators. Then, the number of members to be chosen in each State shall be determined by dividing the population of the State by the quota. The section further provides that where there is a remainder greater than one-half of the quota, one more member shall be chosen in the State.

The application of this procedure following the 1961 census resulted in the following entitlement for each State -

This is a total of 120 members for the House of Representatives or an overall decrease of two members on the existing representation.

The determination represented a gain of one member for Victoria but the loss of one member each for the States of New South Wales, Queensland and Western Australia. On the basis of this determination, distribution commissioners were appointed for the purpose of redistributing the States into new divisions and the commissioners’ proposals were ‘ tabled in the Senate on 9th October 1962. During the debate on the New South Wales proposals, the Opposition in the House of Representatives opposed the proposed loss of a member in New South

Wales and also referred to the proposed loss of a member in both Queensland and Western Australia. The Opposition expressed the view that one more member should be chosen for a State when the remainder was 10 per cent, of the quota. The Leader of the Country Party in the House of Representatives also opposed the proposals and suggested that where there was “any remainder at all”, a State should be entitled to one more member for that remainder.

In view of the comments made during the debate on the New South Wales proposals, the Prime Minister undertook to have the arguments for and against the proposals carefully examined. This examination has been effected and the Government agrees that steps should be taken to ensure that a State obtains an additional member for any fraction of a quota and this Bill purports to achieve that objective.

The Bill also provides that the last determination made by the Chief Electoral Officer, that is the determination made following the 1961 census, which would have resulted in the loss of one member each for New South Wales, Queensland and Western Australia and a gain of one member for Victoria, will be rendered ineffective. A fresh determination will then be made which, in effect, will result in 46 members being chosen for New South Wales, 34 for Victoria, 18 for Queensland, 12 for South Australia, 9 for Western Australia and 5 for Tasmania, following the next redistribution. That is, a total of 124 members of the House of Representatives for the States as against the 120 members which would have been the case without the proposed amendments. I commend the Bill to honorable senators.

Debate (on motion by Senator McKenna adjourned.

page 1518

QUESTION

BUSINESS OF THE SENATE

Senator POKE:
Tasmania

– by leave - I refer to General Business Order of the Day No. 6 -

Air Navigation - letter from Prime Minister to State Premiers - Paper. - Adjourned debate from 25th August on the motion by Senator 0 Byrne viz. - That the Paper be printed.

To enable the Printing Committee to consider this Paper in conjunction with the replies from the Premiers which have also been tabled, I move -

That the motion standing in Senator 0’Byrne’. name be altered from “That the Paper be printed” to “That the Senate take note of the Paper”.

Question resolved in the affirmative.

page 1518

COPPER AND BRASS STRIP BOUNTY BILL 1964

Second Reading

Debate resumed from 30th October (vide page 1476), on motion by Senator Anderson -

That the Bill be now read a second time.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The purpose of the Bill before the Senate is to extend the operations of the Copper and Brass Strip Bounty Act 1962 for a further maximum period of six months from 1st October 1964 to 31st March 1965. As was stated by the Minister for Customs and Excise (Senator Anderson) in his second reading speech, a review of the need for further protection of the industry concerned is currently being undertaken by the Tariff Board. The completion of the inquiry has been delayed by unforeseen complications. Provision is made in the Bill, therefore, for the Government to have time to receive, study and act upon the Tariff Board’s report. After considering the report, the Government may determine the period of operation of the Act by proclamation before 31st March 1965. The extension of six months is the maximum contemplated in the Bill and the relevant period may be even shorter.

The Act limits the total amount of subsidy payable to £190,000 a year. The Bill provides that a proportion of that amount may be made available. If the extension of the Act runs to the full six months, this amount will be £95,000.

Senator Wright:

– Representing the payment for six months?

Senator McKENNA:

– Yes, for one half of the total annual amount. If a proclamation is issued and the Act operates for a shorter period than six months, the maximum that may be paid will be proportionately readjusted.

Senator Wright:

– Has the Leader of the Opposition the amounts paid in recent years?

Senator McKENNA:

– I have not those amounts before me now but £190,000 has been the limit for some considerable time. Another provision to which I think I should advert is that contained in clause 5 of the Bill. It is proposed to give to the Minister a discretion in the event of a profit of more than 10 per cent, being made on funds used in a company benefiting by the bounty. The Minister may then apply that surplus towards deficiencies, losses or amounts lower than 10 per cent, in preceding years. That is an additional benefit to the companies in this field provided in the Bill.

Senator Wright:

– is it stated that this provision exists for the first time in this Bill?

Senator McKENNA:

– It is not stated in the Minister’s second reading speech but my impression is that this is the first time it has developed. The Opposition does not oppose the measure before the Senate.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– in reply - The provision in the Bill is not peculiar to this measure. It is a discretion included in a number of bounty acts. The background and the circumstances of companies concerned have to be closely examined. The amount paid for the year ended 30th . June 1963 for a period of nine months was £18,512 and to 30th June 1964, the payments totalled £61,746. It was estimated that the expenditure for 1964-65 to 30th September would be £53,000. Honorable senators will appreciate that this is an estimate because the final amounts are not paid until some time after the relevant period. As the Leader of the Opposition (Senator McKenna) has said, there is a profit limitation of 10 per cent. The bounty is £45 a ton.

Question resolved in the affirmative.

Bill read a second time.

In Committee.

The Bill.

Senator WRIGHT:
Tasmania

.- I am obliged to the Minister for Customs and Excise (Senator Anderson) for the information on payments that have been made in the two years preceding this one. My interest stems from the fact that the major copper producer in Tasmania is dependent on the bounty. Has the Minister for Customs and Excise details of bounty Payments to the Mount Lyell Mining and Railway Co. Ltd. for the past two years?

Senator Anderson:

– This bounty applies to copper and brass strip.

Senator WRIGHT:

– I am in error in thinking that this is a copper production bounty. The figures that the Minister provided seem a little at variance with what I understood was paid in the way of copper bounty. I am glad that this matter has been elucidated.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

Bill (on motion by Senator Anderson) read a third time.

page 1519

REPRESENTATION BILL 1964

Second Reading

Debate resumed (vide page 1518).

Senator McKENNA:
Leader of the Opposition · Tasmania

– The Bill was introduced into this chamber only a short time ago, so its contents will be fresh in the minds of honorable senators. Accordingly, I shall not traverse at any length the facts and figures that the Minister cited in his speech. On behalf of the Opposition, I move an amendment to the motion that the Bill be read a second time. I move -

Leave out all words after “ That “, insert: - “ the Senate is of opinion that a decision on the proposal contained in the Bill should be deferred until the Government introduces other electoral legislation announced in the Governor-General’s Opening Speech and until the people have been given an opportunity to vote at a referendum on the Constitutional Review Committee’s proposals on Commonwealth legislative machinery “.

The Minister’s speech and the Bill show that the two proposed alterations are simple in form. It is proposed that section 10 of the Representation Act be amended to enable an additional member to be provided in a State when, on division of the population of that State by the quota, there is any remainder. The present provision in section 10 of the Act is that there must be a remainder of more than one-half before the additional member is ceded to the State. The determination that was made following the census of 1961 would have reduced the number of members in the House of Representatives by a net two, from 122 to 120. There would have been a gain of one in one State and a loss of one in each of three other States. The effect of this Bill is that there will be no loss of a seat in any State and that the total number of members will be increased from the present 122 to 124.

The Opposition notes that in the course of the Governor-General’s Speech when he opened the new session of the Parliament early this year two measures were forecast to deal with electoral change. One was the introduction of the Representation Bill contemplating a change of the nature now before us, and the other was an amendment of the Electoral Act. The GovernorGeneral, in announcing the Government’s intentions, pointed out that the amendment of the Electoral Act would be directed towards indicating to the Distribution Commissioners the various factors that should be taken into consideration when determining boundaries within a State.

In the first place, the Opposition feels that this Bill and the proposed alteration of the Electoral Act arc linked together and that they should be considered together. It is quite certain that there would be no point in disposing now of the Bill before us and awaiting the advent of the measure containing the proposed changes of the Electoral Act. If this Bill is carried, it is perfectly certain that there will be no redistribution until such time as the changes of the Electoral Act come into effect, so there seems to be no particular virtue in proceeding with this measure by itself. Nothing would be lost and a good deal could be gained by considering the two matters as parts of one broad approach to the electoral changes that the Government has in mind.

I have indicated in the terms of the amendment that I have proposed on behalf of the Opposition that there are before the Senate at the moment four Bills proposing changes in the legislative machinery of the Commonwealth. Each of the Bills, if carried, would have to be the subject of a referendum. At this stage I make the point that those Bills were presented in ample time to enable them to be debated and dealt with by the Parliament and, if approved, to be submitted to the people at the election that is now fixed for 5th December. We of the Opposition feel that it is most unfortunate, from the viewpoint of the country, that those Bills were not debated and considered by the Parliament and that the opportunity was not taken to submit them for determination by the people concurrently with the election that is now to be held early in December. Had those Bills gone before the people, the particular matter to which this Bill is directed would have been resolved. In fact, there would have been no need for the Bill. It may well be that when the Parliament reassembles next year the Government, following debate, will feel that at least some of the proposals contained in the Bills I have mentioned ought to be presented to the people.

Senator Wright:

– What was the particular recommendation of the Constitutional Review Committee? Was it that the numbers in each electorate should not exceed 80,000?

Senator McKENNA:

– I have referred to a number of matters.

Senator Wright:

– I know, but what was the recommendation on this particular point?

Senator McKENNA:

– Several matters relate to this particular point. If 1 may enumerate them-

Mr DEPUTY PRESIDENT:
Senator Wood

– I do not think that the honorable senator would be in order in dealing with those other Bills when we have this Bill before us. I think he should confine himself to this one.

Senator McKENNA:

– I accept what you say, Mr. Deputy President, but I point out that my proposed amendment refers to a referendum on the proposals of the Constitutional Review Committee relating to Commonwealth legislative machinery. I have put in issue - quite properly, I suggest - the question of the recommendations made by the Constitutional Review Committee. I have made merely a passing reference to the fact that the recommendations relating to Commonwealth legislative machinery are embodied in Bills now before the Senate. I do not propose to deal with the contents of those Bills. I have contented myself with the comment that it is unfortunate that the Bills were not considered in time to enable them to go to the people at the next election. I leave those Bills with that comment.

Coming back to Senator Wright’s query as to what I had particularly in mind on the recommendations of the Constitutional Review Committee, I would say to him that as population is the first thing to be considered in determining the number of members to be elected to the House of Representatives, this Parliament ought to be particularly concerned to repeal section 127.

Senator Wright:

– Yes, but all I wanted to know, in order to consider the honorable senator’s amendment, was the recommendations of the Committee to which he has referred in the amendment.

Senator McKENNA:

– I am dealing with them now. That was the first of them. In order to arrive at the numbers to be elected in the State, we all must have a quota. The quota is determined by dividing twice the number of senators into the population of the Commonwealth. The Joint Committee on Constitutional Review recommended that section 127 of the Constitution be repealed. That section provides -

In reckoning the numbers of the people of the Commonwealth, or of a State or other part of the Commonwealth, aboriginal natives shall not be counted.

So, this is one of the outstanding recommendations that could quite appreciably, so long as we have a quota determined in that way, affect the ultimate result in determining what the quota should be. Again, that particular section has application when we come to the stage of dividing the quota into the populations of the States because section 127 of the Constitution, in the view I take, requires that Aborigines be disregarded in reckoning the population of a State. That is the first point that I have in mind.

The second point is that the nexus between the Senate and the House of Representatives should be broken and that no longer should it be required that twice the number of senators should be divided into the total population of Australia. As the honorable senator will recall, the Joint Committee on Constitutional Review, which was nearly unanimous in its decision, came to that conclusion, with the further thought in mind that it would be better for the Parliament to select a figure, being not less than 80,000, for division into the population of the States. In other words, the Committee came to the conclusion that the Parliament could determine a quota, being not less than 80,000 persons, which would (hen be divided into the populations of the various States.

Senator Wright:

– Was that a recommendation which was conditional on breaking the nexus between the Senate and the House of Representatives?

Senator McKENNA:

– Yes. It is part of the general proposal. That is unquestionable. There is the need to break this nexus altogether because the great objection, as I believe the Committee saw, was the need for increasing numbers in this chamber before there could be any increase in the numbers in the House of Representatives. So, the need to break that connection, which is expressed in our Constitution at the moment, was really implicit in what the Joint Committee on Constitutional Review recommended. The difficulty, as the Senate will appreciate, is that if we are to adhere to the present position, and the desire is to increase the numbers in the House of Representatives, then from every practical viewpoint four new senators must be ceded to each of the six States. The reason is that we must have representation from the States which, on division by two for the purposes of periodical Senate elections, will come to an odd number. Therefore, the addition of four senators to the present 10 senators from each State would mean that as senators retired each three years, seven would go to the people. If it were to be an even number, in the state of politics in this country, it is almost certain that the major parties would come back evenly balanced and that a permanent condition of deadlock would very speedily be established in die Senate. I do not think that anybody would regard that as a desideratum. It would seem, from the point of view of practical politics as our Constitution now stands, that if we want to increase the numbers in the House of Representatives, we have to create four new senatorships in each of the six States. I do not feel that anybody in any political party considers that such an increase is justified.

The recommendation of the Constitutional Review Committee was in line with the argument I am putting that the Constitution should be amended to provide that there be no less than six nor more than ten senators from each State. I have only to indicate that, in the United States of America with a total population of ISO million, there are two senators from each of its 50 States. Australia, with a population of some 1 1 million, has 10 senators from each State. I think I might properly say that the States are adequately represented on an even base by numbers of these dimensions and that the Senate carries out its function quite well on its present numerical basis. The position - perhaps “ evil “ is too strong a word to be used in this connection - that needs correction is that throughout Australia we have some electorates ranging up to 100,000 electors whereas other electorates have as few as 32,000 electors, and representation is completely uneven. There are special difficulties owing to the nature of our country and the scattering of our populations. One can anticipate that there will be divergences between the numbers of electors in varying and vastly differing types of electorates. It is felt that there should be more members in those circumstances to look after relatively smaller areas with great advantage to the Parliament. But there is no need to be forced into the position of increasing the numbers in this chamber to achieve that position.

Bracketed with those recommendations of the Joint Committee on Constitutional Review was the one against gerrymander, seeking to enshrine in the Constitution the provision which whilst it left some elasticity for particular reasons to the distribution commissioners and to the Parliament would prevent a situation developing where there could be a complete gerrymandering of electorates. At the present time, there is no expressed safeguard in the Constitution against that type of thing taking place. Under section 24 of the Constitution, the division of States into electorates is left. It is not arbitrary. It is to operate until such time as the Parliament otherwise provides. Where there is the possibility under the Constitution at the moment of a decided gerrymander in House of Representatives seats, the Constitutional Review Committee very properly, I think, and very strongly, I suggest, has put the proposal that there should be no variation from the quota determined by the Parliament in any division except to the extent of one-tenth up or one-tenth down. At the moment the Parliament allows the distribution commissioners the opportunity to vary to the extent of 20 per cent, above or below a quota in determining a division. How widely that can range can be seen if for the sake of argument, we take 100,000 as the norm. A 20 per cent, reduction will put the lower division at 80,000. A 20 per cent, increase will put the higher division at 120,000. As between the lower division of 80,000 and the higher division of 120,000, there is a difference of 50 per cent. That is permissible at the moment under the Act as approved by the Parliament. I understand that in only a very few instances has the variation gone close to 20 per cent. I understand that it ha3 exceeded 17 per cent.

The factors that I am not quite briefly and perhaps inadequately putting before the Senate ought to be taken into consideration at this stage, because if there is any validity in the recommendations of the Constitutional Review Committee, which the Government has now had before it for six years, surely now is the time to make a decision on them. Looking at it arithmetically, the proposed arbitrary step could lead to the rather astonishing situation where, if a State had one person more than the official quota which might be about 80,000, then that State would get a new member. The proposal does not seem to be sensible when I reduce it to those terms.

I am happy to speak to the Bill, no matter how briefly, if only to record my doubt about whether the proposal is constitutionally sound. The Constitution requires that the number of members in the House of Representatives shall be as nearly as practicable twice the number of those in the Senate. If we give a literal interpretation to the words “ as nearly as practicable “, it is difficult to justify having 124 members in the House of Representatives as against 60 in the Senate on the argument that one person more than the quota can yield one of the additional four seats. I do not wish to pursue the matter any further. I merely express my doubt about whether that state of affairs would be constitutionally sound. It may well be that the position could be challenged. If it were challenged successfully, one can imagine the chaos that would be caused following elections for this Parliament. All the arguments conspire to support the amendment that the Opposition has put forward. The Government’s proposal, in respect of which there is no hurry and about which nothing will be done until the Government is prepared to undertake a redistribution, could well wait until the Government made up its mind about constitutional reform for the legislative machinery of the Parliament. That reform is overdue.

I suggest most strongly that an increase of the number of members in the House of Representatives is desirable. I understand that if the proposal advanced by the Constitutional Review Committee were adopted and if a quota of 80,000 persons, which would mean about 46,000 electors, were set to determine the number of members of the House of Representatives, the result would bc .139 members in that House. That would be a desirable number to have. The more remote areas could bc contracted into smaller and more manageable divisions and there would be better representation all round Australia. I do not think that anybody would seriously controvert that proposal.

I return to the variation of the quota and the need for protection against gerrymander. 1 have already indicated that there is no such protection in the Constitution at the moment. Perhaps we can find protection in the interpretations of the Supreme Court of the United States of America in a number of recent cases. The Court, when interpreting sections of the American Constitution which are similar to our own, pointed out that members have to be elected by the people, and it set its face against gerrymanders of the type that were quite notorious in America. I say that I have justified the Opposition’s amendment. I indicate that in my view there is constitutional danger in what the Government now proposes. I should think that in the circumstances of the moment it would bc wise for the Government to accept the amendment and to defer consideration of the Bill.

The Bill contains one other proposal to which I shall advert quite briefly. It provides that the determination of the Chief Electoral Officer concerning the number of members of the House of Representatives made after the census of 1961 shall be abandoned, and it directs that officer to make a determination as provided by section 10 of the Reppresentation Act as amended by this Bill. The Opposition offers no objection to that postponing provision. I hope that, despite the Government’s rejection of the amendment moved by the Opposition in another place, it will have second thoughts about the matter and will see the wisdom of deferring further consideration of the proposal. Even if the Government is not prepared to do that, the

Opposition does not feel sufficiently strongly about the matter to oppose the measure. We shall allow the Bill to pass, but we shall do so reluctantly. We recognise the need for further members in the House of Representatives. That is one of the reasons which influence us to adopt the attitude that I have just indicated.

Senator WEDGWOOD:
Victoria

.- Mr. Acting Deputy President, I desire to speak briefly in support of the Bill and against the amendment. The Representation Act, which we now seek to amend, is a simple Act which determines the number of members in the House of Representatives. It has not been altered on many occasions, the last amendment, I understand, being in 1938. The reason for the infrequency of amendment is easy to understand. For many years there were no violent fluctuations in the growth of the Australian population. It has been only in recent years that there has been a dramatic increase in the number of persons residing in Australia. The result has been greatly increased enrolment figures over Australia as a whole, with a more rapid increase in some States than in others.

I should like to join issue with the Leader of the Opposition (Senator McKenna) when he says that the Representation Act and the Electoral Act should be considered together. They have not always been considered together in the past. I find a notable difference between the view expressed by the Opposition in its amendment and the views expressed in 1962 when the proposals for redistribution adverted to by the Minister for Customs and Excise (Senator Anderson) were before the House of Representatives. The purpose of the amendment now before us is to defer consideration of the Government’s proposal until we are considering redistribution as a whole. On 4th December 1962, Mr. Calwell expressed the view that a fresh distribution should not bc made until the Representation Act had been amended, so as to restore at least the seat lost in each instance to New South Wales, Queensland and Western Australia under the present distribution and to provide an additional seat to South Australia. So I suggest thai evidently at that time the Opposition was not concerned at the constitutional aspects of any alteration to the

Representation Act. In the words of its own leader, it was suggesting that the Act should be altered before there was a redistribution. Senator McKenna’s proposed amendment does not commend itself to me. It does not accord with my opinion, nor with the submission made by the leader of the honorable senator’s party, to which I have referred.

Section 10 of the Act requires that a quota shall be determined by dividing the number of people in the Commonwealth by twice the number of senators, and that the number of members to be chosen in each State shall be determined by dividing the population of the State by the quota. Therefore I submit that the main purpose of the Bill before us is to give a State an additional member for any fraction of a quota, instead of for a remainder greater than half the quota. It does that and no more than that.

As I have said, over the years there has been a remarkable increase in the numbers of people who enrol and vote. This increase will continue. I do not believe that the proposed legislation will give real satisfaction to all the States. It is true that one or more States may gain, but that does not mean that the gain necessarily will benefit a State for all time. It may be that over the years one State may benefit comparatively more than other States because of increases in population. In the past Victoria and New South Wales have gained the greatest numbers of people, but as time passes they may lag behind the other States.

I believe that the measure before us is a simple one and should be so regarded. Many of the matters referred to by Senator McKenna fall more appropriately within the terms of the Electoral Act. I have pleasure in supporting the Bill and rejecting the proposed amendment.

Senator LAUGHT:
South Australia

– Like Senator Wedgwood, I rise to support the Bill and reject the proposed amendment. I think the Bill is a very practical measure. It is interesting that it can be discussed in the Senate without reference to any electoral matter that may personally affect honorable senators. The population of Australia has greatly increased. Possibly it has doubled since the Representation Act was last examined. Certainly it has risen by between one million and two million people since the last redistribution.

The practical effect of the measure is that there will be 124 members of the House of Representatives instead of 120 members, as was calculated by reference to the old Act. I have discovered some figures which may interest honorable senators. They are based on the latest enrolment figures as at 26th June 1964, which reveal the total number of electors for each State. Should the Representation Act be amended to provided for an increase of two members from 122 to 124 in the House of Representatives, South Australia will have 12 members for an enrolment of 550,303. The quota would be 45,859. The permissible maximum could rise to 55,031 and the permissible minimum could fall to 36,687.

If the Representation Act were unaltered, the number of members of the House of Representatives would be reduced by two, from 122 to 120. In the case of South Australia, with 11 members and an enrolment of 550,303, the quota would rise to 50,028. The permissible maximum would rise to 60,034 and the permissible minimum would fall to 40,022. As a South Australian senator, I think it appropriate that the quota should fall to 45,859 rather than rise to 50,028. I say that for a number of reasons. First, the amount of work to be performed by members of this Parliament is increasing each year as the Commonwealth .assumes new functions. Secondly, additional work is involved because of the development of the functions already assumed by the Commonwealth. I shall give an illustration. The advent of commercial television has added greatly to the functions of the Commonwealth in South Australia, the State which I represent. The Commonwealth’s role in the provision of postal and aerodrome facilities has broadened. The demand for telephones has greatly increased. AH these matters come within the responsibility of a federal member of Parliament.

At present we are examining the position in the House of Representatives. I welcome the Bill which will increase the number of members for South Australia from 11 to 12. Further, instead of a quota for a member being 50,028, it will, fall to 45,859. I think there is good sense in these changes and I see no reason to delay their implementation.

It seems to me that before the redistribution of electoral boundaries in a State should take place, the men charged with the responsibility for redistribution should know for how many members of the House of Representatives they are expected to make territorial provision. Therefore, it is logical that this Bill should bc passed first so that when the time comes for the other necessary work to be carried out, the commissioners will know precisely the starting point. If the redistribution were simply in contemplation, the commissioners would not be able to determine the starting point. I think there is great virtue in the Government introducing this legislation now, rather than deferring it as suggested in the amendment moved by Senator McKenna. I give the Bill my support and I think it will have a speedy passage without, of course, the proposed amendment being carried.

Senator CORMACK:
Victoria

.- I do not intend to take up very much of the time of the Senate in discussing this matter because I think that the Leader of the Opposition (Senator McKenna) has traversed the situation in general terms very fairly. However, I thought he moved away from the subject matter of the Bill, which is a proposal to increase the number of members of the House of Representatives by elimination of the requirement under the Representation Act in terms of fractions. The honorable senator discussed the relationship of the number of senators to the number of members of the House of Representatives. I wish to make some comments on this matter. I refer, first, to his comments in relation to the Constitutional Review Committee which dealt with this particular subject. I want to congratulate him on the immense amount of hard work which he put into the Bills that he presented to the Senate earlier in this sessional period.

There is no doubt that the Parliament - and I mean the Parliament - will have to grapple with this whole question of redistribution and of representation generally before very long. I shall confine myself to some of the remarks made by Senator McKenna by stating a simple parable, as it were. I remember talking to a Premier of Victoria who was regarded even by his opponents as a reasonably astute politician.

He said that the problem of redistribution, human nature being as it is, always involves the individual member of the popular House in immediately looking at the electoral map in his mind’s eye and seeing how the proposed redistribution is going to. affect him. His judgment of the appropriateness or otherwise of the redistribution always is related to the question of how the proposed adjustment of boundaries will affect him personally.

I do not regard that as a cynical comment at all. I think it is a reasonable comment, because Parliament is a place where men discuss the proprieties and the justice of legislation which they feel is either necessary or unnecessary for the well being of the people. The fundamental belief of all politicians, of course, is that if you are not in Parliament you have nothing to contribute to the requirements of the political life in which you are involved. To a substantial degree, I think this observation is true of the interim Bill we have before us - and 1 hope it is only an interim Bill: - which relates to the proposed increase in the number of members of the House of Representatives. What disturbs me about this proposal is that it is, in fact, stretching a constitutional propriety in relation to. the requirement that the number of members shall bc, as nearly as practicable, twice the number of senators. Senator McKenna touched on the point when he said that we may find that this matter is not in our hands at all. He properly and cogently referred to the fact that in the United States of America where vast changes have been taking place because of the movement of population, the electoral districts for the House of Representatives have become so out of adjustment with the true needs of the Congress that the Supreme Court of the United States has had to intervene.

Senator McKenna may care to correct me if I am wrong, but it seems to me that a citizen of the Commonwealth of Australia may decide that the Constitution is being distorted by this Bill and may apply to the High Court of Australia for a judgment as to whether the bill is constitutional. All we can say, as members of the Parliament, is’ that in the opinion of the Parliament this Bill meets the constitutional test; but it may well be that the High Court of Australia, if the opportunity is given to it, will decide otherwise. 1 mention this matter merely to’ illustrate how important it is that the Parliament should emphatically turn its attention to the whole question of the Representation Act and the terms of the report of the Constitutional Review Committee.

Whereas, normally, I think I would be prepared to accept the arguments of the Leader of the Opposition in relation to the Bill, I feel that in this instance the Government is compelled to do nothing less than it proposes to do, which is to attempt to provide an adequate representation as a short term measure. In my mind it is unavoidable that the number of members of the House of Representatives will rise in a substantial way, perhaps in the next five or seven years. We are concerned with the constitutional problem which arises from the fact that the House of Representatives is bound to the Senate. Therefore, we come to the problem of breaking the nexus between the two Houses. There is a curiosity about constitutional amendments when we seek to obtain them by a bill for an act for a referendum and then proceed to conduct the referendum. It requires a degree of clairvoyance which I do not claim to possess, to see how on earth the electorate is to make a judgment on the matter.

Only in the last three weeks we have seen a difference of opinion between the Commonwealth and the State of New South Wales in regard to airline operations. This matter was put to the people by way of referendum in 1938. One would imagine that it was a clear and concise issue on which there could be no doubt, and that the people would make up their minds that it involved an element of constitutional power which should be given to the Commonwealth, just as clearly as there was embedded in the Constitution the power of the Commonwealth over other forms of communication, such as posts and telegraphs. Yet the electorate rejected the proposal to give that power to the Commonwealth. I am not too sure what would be the result of a referendum in Australia in an attempt, justly I suggest, to break the nexus between the House of Representatives and the Senate. I say that without wishing to annoy my colleagues from other States, particularly Tasmania and South Australia. I am doubtful whether South Australia would agree to the nexus being broken. Already there have been published indications that South Australia would not be agreeable.

I cannot make any prognosis in relation to Senator McKenna’s State of Tasmania. I should hope that Tasmania would help to carry a referendum to break the nexus between the House of Representatives and the Senate, if for no other reason than that the Tasmanians would be true patriots and realise that we have a fantastic situation when Tasmania is guaranteed five representatives in the House of Representatives and ten representatives in the Senate, or double the number in the House of Representatives. I do not know whether, in the light of this curious situation, Tasmania would agree that the nexus should be broken, but I hope it would agree. So, although I think that we in the Senate, as constitutionalists to a man, would agree that the nexus between the House of Representatives and the Senate should be broken, there is no guarantee that a majority of the people in a majority of the States also would agree. The very first thing to do is to break the nexus, as purported to be favoured by the Constitutional Review Committee.

I turn to the question of the desirable number of members of the House of Representatives. It is now to rise to 124. Senator McKenna has suggested the number of, I think, 139. I go further and suggest that, with the rapid development of population in the centres to which people are being attracted, the number in the House of Representatives should rise to about ISO.

Now we come to the paradox that, if it is suggested that the number should be raised to 180, Tasmania, South Australia and Western Australia will object because they will feel that they will be overshadowed by the concentrations of population that are beginning to develop in New South Wales and Victoria as a result of industrialisation. This paradox is inherent in the problem of redistribution.

Senator Wright:

– What advantage would the people get by having a greater number of members in the House of Representatives?

Senator CORMACK:

– I think there are substantial reasons why there should be a greater number of members of the House of Representatives. If for no other reason, a larger House of Representatives would provide a greater number of members from which to select a Ministry. We have reached a stage of maturity in terms of what the Parliament has to provide in relation to the government of the country. The governing of a country has become enormously complex. In the House of Commons there are over 600 members from whom is chosen a Ministry of 40. In the House of Representatives and the Senate there are approximately 1 80 people, from whom is chosen a Ministry of 25. As these 180 people comprise Government members and Opposition members, let us divide the number by two. One sees that the number available from which to choose a Ministry raises difficult problems. If for no other reason the number of members of the House of Representatives should be increased to provide a wider field for selection of the Ministry.

Senator Wright:

– Why not reduce the number to the number in the Ministry? There are some people who say that nobody outside the Ministry counts.

Senator CORMACK:

– There is a degree of cynicism to which members of the Parliament are entitled, but it rather disturbs me that Senator Wright has become so sharp in his cynicism that he would advance that view. This measure cannot be regarded as anything other than temporary salve for the wound, but I think it has to be passed. I do not think that the amendment which has been moved by Senator McKenna does justice to the problem. The problem cannot be solved except by breaking the nexus between the House of Representatives and the Senate. In order to break that nexus, there has to be a unanimous wish by all parties to go to the people and seek to persuade them to agree to an appropriate amendment of the Constitution. If the nexus were broken, there should not be any attempt to raise the number of senators. The population growth at the present time is such that, if the nexus were broken, the number of members of the House of Representatives should rise, beyond the 139 forecast by the Australian Labour Party, to a minimum, in my opinion, of 180. For that reason, and only for that reason, I reject the amendment moved by Senator McKenna and urge my colleagues to support the Bill.

Senator Sir WILLIAM SPOONER (New South Wales) [4.35].- I hope that my colleagues on this side of the chamber will not think unkindly of me if I commence by saying that I always like to hear the Leader of the Opposition (Senator McKenna) open the debate on a measure before the Senate. He has the habit, of which I thoroughly approve, of giving a short historical survey of the background of the proposed legislation, combined with an outline of its contents. I find his speech to be a very useful commencing point in a debate on any legislation. 1 hasten to add that, after being interested in and pleased with his opening gambit, I very seldom find myself in agreement with the conclusions which he reaches. On this occasion, the debate has run the usual course in that respect.

I commend the Leader of the Opposition for gathering together the loose strands and for giving us the contents of the legislation. He has contrasted the proposals in this measure with other proposals, and has thus given us a balanced picture of the problem before us. I disagree with him on this occasion - as 1 have so frequently in the past - because he. proceeded to compare like and unlike matters. He spoke of the contents of the Bill that is now before the Senate and then compared them with recommendations in the report of the Constitutional Review Committee, which, for all practical purposes, I do not think is a matter for consideration at this stage. We have to speak in practical terms.

There is without doubt a good field of argument concerning the recommendations of the Constitutional Review Committee for breaking the nexus between the two Houses of the Parliament. I am one of those people who hold the view that a referendum on that topic would not have the chances of success that some of its supporters think it has. I think that a proposal which, in the event of a deadlock between the two Houses, would, in effect, reduce the comparative voting power of the smaller States might not receive the approval of those smaller States. I do not think it is germane to include a consideration of that problem in the matter that is now before the Senate. I think it is quite a separate and distinct matter.

The problem falls into two parts. First, what do we do in the particular circumstance that - I suggest to the surprise of most people - a redistribution resulted in a reduction in the number of members in the House of Representatives? In quite a separate compartment altogether is the matter of what we should do on the greater problem of the correct method by which the size of the House of Representatives should be increased. In my judgment, there is no great need to increase the size of the Senate, but I do hold the view that, whatever formula is devised, the relative strengths of the smaller States should not be impaired in any redistribution proposal. The Bill before us will avoid the surprising effect which would have followed the adoption of the last redistribution proposals. It contains a proviso that any State in which there is an excess of voters when the total number enrolled is divided by the quota will become entitled to an additional member. That is a practical provision. I cannot believe that the Government, having evolved this proposal, is at any risk of not being constitutionally correct. A provision that the House of Representatives shall have 124 members will not offend the requirement of the Constitution that that House shall as nearly as practicable be twice the size of the Senate. I am sure that those persons advising the Government would have carefully considered that angle and would have advised that 124 was as nearly practicable twice 60.

By means of this Bill we shall set that position right. We shall increase the size of the House of Representatives without, I believe, offending against any constitutional provision. We shall get a good practical result and a small increase in the size of the House of Representatives. We shall remove the great objections of some States that would otherwise have lost some small representation in the House of Representatives. I have no doubt that at a later stage we shall have another bill which will, I should think, be comparatively simple, to deal with the discretionary power that is given to distribution commissioners in relation to their determination of the number of electors in the various electoral divisions. I do not expect that such a bill will cause us any great difficulty.

I do not see any great purpose in deferring consideration of this Bill until that second proposal comes before the Parliament, because both these matters have been outlined in the Governor-General’s Speech. Both of them will need to be considered. With this Bill we take the first step. At some subsequent stage, perhaps in the next session of the Parliament, we shall take the next step. After passage of this Bill we shall reach a situation in which the greater matter will be outstanding. There may be some justice in the statement of the Leader of the Opposition that this is a matter that has been outstanding for some considerable time, but it is, of course, a great matter to determine not only what shall be the respective powers of the two Houses of the Parliament but also how any changes in those powers or in the constitution of those Houses will affect the relative strengths of the States in the Parliament. I believe that this Bill constitutes a logical approach to the matter on the part of the Government. I support the Bill and I shall oppose the amendment that has been moved by the Leader of the Opposition.

Senator PROWSE:
Western Australia

.- I should like to direct attention to one aspect of the matter that has been raised by the Leader of the Opposition (Senator McKenna) with reference to the possibility of some constitutional challenge based on the legal understanding of the meaning of the word “ practical “. I point out that the framers of our Constitution also made a proviso in the interests of the smallest State, Tasmania. They provided that the number of representatives from Tasmania should not fall below five and I think that this is an aspect that we should remember when we consider the meaning of the word “practical” in relation to the matter of quotas.

If we look at the practicalities of the matter we find that there is a differential effect in the application of this interpretation of the Act when the remainder is one under half a quota. The matter is not very serious in its application to a State such as New South Wales, which has some 46 members; if the number drops from 46 to 45 the effect on a quota is very small. But when the provision is applied to Western Australia, the effect on the quota is serious. A quota for Western Australia, with nine members, was 45,665 persons, but if the number of members dropped to eight, as would have happened under the proposed redistribution, the quota would have risen to 51,362. Therefore, Western Australia would have had the highest quota of any

State in the Commonwealth. If the framers of our Constitution saw fit to incorporate a safeguard in the interests of Tasmania, surely this matter of the position of a State relative to the whole is of considerable importance.

There is another practical matter to consider. With the Australian population increasing as it has increased, with each State’s population increasing in a fairly steady manner relative to the population of other States, variations above and below a quota can happen at every redistribution. Every few years the number of members from Western Australia would switch from eight to nine and back to eight. It is relatively simple to make allowances when the difference is only one out of 45, but when the number has to drop from nine to eight, the practical consequence is that large readjustments have to be made to achieve the desired result. 1 think that the present proposal is a practical way of resolving what is a very undesirable slate of affairs. I support the Bill and oppose the amendment.

Senator MATTNER:
South Australia

– I support the Bill, and I agree with much that has been said in the Senate today, but I am not in agreement with many persons who are advocating an enlargement of the representation in the House of Representatives. Under the Bill, the maximum number of members who could be elected to the House of Representatives would be 125 if we assume that Tasmania will not develop to any great extent in the near future.

Senator Lillico:

– Where did the honorable senator get that impression?

Senator MATTNER:

– Tasmania has five representatives, and unless its population increases greatly, I fail to see how it can get increased representation on the basis of the proposed quotas. I have noted what has been said by the Constitutional Review Committee about quotas for the House of Representatives and also what is being said by those who advocate an enlargement of the House of Representatives because of an expected increase in the population. Where do they expect that increase in the population to take place? It has been said that it will occur in Victoria and New South Wales and parts of Queensland. If that happens, the area to bc served by each member oE the House of Representatives will not be increased to any great extent. As a matter of fact, a member of the House of Representatives will actually represent a smaller area of land. He will not have more travelling to do, but less.

With all respect to the views that have been expressed in the debate, I do not believe that the duties of members of the House of Representatives will be extended or that any functions the Commonwealth Government may assume will give members of the House of Representatives a great deal more work than they do now. At present each State has 10 representatives in the Senate. If that situation is unchanged and the population increases to the extent that has been envisaged, will not the duties of senators be increased correspondingly? I say that they will be so increased and that the duties of senators will be extended more than those of members of the House of Representatives. Therefore, if the number of members of the House of Representatives is increased on the ground that they will have more duties to perform, I contend that this argument should be applied also to the Senate.

I am not convinced by any of the arguments that have been produced in this chamber or outside in favour of an increase in the present number of members in the House of Representatives. I represent one of the smaller States in terms of population and I could never agree that the House of Representatives should be other than, as nearly as practicable, twice the size of the Senate. My only exception would be in relation to the application of fractions which, in the present situation, would give us 125 members in the House of Representatives and 60 in the Senate.

In his second reading speech, the Minister for Customs and Excise (Senator Anderson) stated that the Bill provided that the last determination made by the Chief Electoral Officer following the 1961 Census, would be rendered ineffective. The Minister added -

A fresh determination will then be made which, in effect, will result in 46 members being chosen for New South Wales, 34 for Victoria, 18 for Queensland, 12 for South Australia, 9 for Western Australia and 5 for Tasmania following the next redistribution. That is, a total of 125 members of the House of Representatives for the States as against the 120 members which would have been the case without the proposed amendments. 1 think that is a very fair distribution. I favour that. Further increases should be a matter for the nation to decide, but when increases are considered, due regard should be paid to the aims and ideals of the Commonwealth. These apply as strongly today to the Senate as they did when the Federal system was inaugurated in Australia. I believe that our electoral system has given fresh impetus to the work of the Senate. The people of Australia are looking to the Senate more and more to fulfil its designed functions as a house of review. Today the Senate plays a far greater part in deciding the great issues that confront Australia than it ever did before. 1 cannot imagine the representatives of the smaller States, particularly, agreeing to a change in the present system under which the size of the House of Representatives is limited as nearly as practicable to twice the size of the Senate. One can imagine what would easily happen if the House of Representatives were enlarged and State representation in the Senate remained unchanged at 10. This would create tremendous constitutional difficulties for the smaller States. Who knows whether the present number of political parties will remain unchanged? If great numbers of members without any party allegiance should enter this chamber we would be faced with the problems that were faced 50 years ago.

Reference has been made to a possible increase in the population. It seems to me that, with a shift of population into the more populous States, their parliamentary representation will be increased tremendously. The smaller States would go to the wall, as it were.

This Bill maintains that reasonable ratio of two for one. For the life of me, I cannot see any reason for increasing the size of the House of Representatives. The claim that members of the House of Representatives are overworked in comparison with senators is just not true, at least as far as senators who represent the smaller States are concerned. If it is so very difficult for members of the House of Representatives to look after their present quota of about 45,000 electors, how much more difficult must it be for a senator to look after the number of electors who are his responsibility? I support the Bill and wish it a speedy passage.

Senator MORRIS:
Queensland

, - As we have been told by the Minister who introduced the Bill into the Senate and as we have seen from the speech of the Minister in another place, this is a very short Bill but a very important one. I think we can claim justifiably that all the legislation that comes before us is important, because it must be considered from the aspect of its long term effect on our country. I have read the amendment that has been proposed by the Leader of the Opposition (Senator McKenna). I think it is fair to say that the net effect of his amendment would be to negative the Bill because it suggests the postponement of the Bill for an indefinite period. Do we want to postpone the action contemplated in the Bill? 1 can see a great deal of merit in it.

As honorable senators know, over the years I have been more interested in the State sphere than in the Federal sphere. It is only recently that I have become interested in the Federal sphere. Having had a principal interest in the State aspect, X have always disliked intensely the possibility that a change in population could mean that, even though the population of a State increased, that State could lose a representative in the Parliament. That is a very bad policy to adopt and a very bad principle to follow. As I read the Bill, it gives us protection against that loss. For that reason I support it. I oppose the amendment for the simple reason that it is a negative rather than an alternate proposal.

It has been interesting to hear the comments of honorable senators on the situation of the Senate. When the Leader of the Opposition was speaking I agreed very firmly, by interjection, with the view that he expressed that we do not want the Senate to be unduly enlarged. Quite frankly, I was amazed to know, although I should have known, that each of the 50 States of America has fewer representatives in the American Senate than an Australian State has in the Australian Senate. The Senate bears a tremendously important responsibility and I believe that it has been able to discharge that responsibility adequately. It has been of considerable interest to me to learn how senators are able to advance the interests of their own States. There seems to be different atmospheres in the upper and lower Houses in the States. Perhaps that can be said to exist in the Federal sphere as well. A senator has a very important task to perform. He is not restricted in his activities in the same way as a member of the House of Representatives is restricted, even by courtesy. A senator can roam the whole State that he represents. He can, therefore, do his work much more effectively than if he were restricted to a particular area. My own experience in this field over the past 12 months has been rather unique. I have broken away from what could almost be called a tradition of using an office in the capital city and have moved into an area 1,000 miles away. It brings one closer to the problems that exist in an area if one lives there.

Let us suppose that as a result of a change in population we in Queensland were deprived of one seat in the House of Representatives. We would be deprived possibly of the services of some one who had obtained wide experience in looking after his electorate and who, over the years, had served what one might call an apprenticeship in the Parliament. I would be very much opposed to that. Therefore, 1 can only repeat that I am in favour of the Bill and, being in favour of the Bill, obviously I am very strongly opposed to any proposed amendment which will delay the Bill becoming law. In what I am about to say now, I am stating only my own opinion. This Bill has not been before us long enough for me even to consider the opinions of others. However, I would infinitely prefer a policy which would remove any likelihood of Queensland losing a member, even though, as the Leader of Opposition said, it could obtain an additional member if the remainder after the population had been divided by the quota were only one.

Since I started my parliamentary career I have seen a tremendous change in the demands made on a member of Parliament. If one goes back 40 years, which is twice the period that I have been in politics, I think one will find that the members of those days had very light duties to perform, but when I commenced my political career I was surprised to discover how fully occupied you were if you did what you felt to be your duty, and did it well. In those 20 years things have changed enormously. I suppose if we had twice as many members in the House of Representatives and in the State Parliaments, they could all, if they were conscientious, employ their time to very good advantage in the development of Australia. One of my greatest regrets, I must admit, is the inability to cover the huge areas that we have in Queensland. I am certain that all honorable senators will agree with me when I say that we do not ever go anywhere within our electorate, whether it is a small part of or the whole State, without finding that we are learning something, or without being able to do some good for somebody or to help somebody. We can improve the legislation which comes before us for consideration because of the knowledge we gain from our travels. That is our job. Therefore, I say again: Give me always the opportunity to retain members rather than be deprived of them as we would have been but for the introduction of this Bill.

Senator ANDERSON:
Minister for Customs and Excise · New South Wales · LP

– in reply - This is a simple bill to give a State an additional member in the House of Representatives for any fraction of a quota in lieu of a member for a remainder greater than one-half of a quota. It will increase the number of members of the House of Representatives to 124. I think that, at the outset, it is appropriate for me to remind the Senate that following the 1961 census, the Chief Electoral Officer made certain determinations as to the entitlement of each State. In New South Wales, the entitlement was 45.13. Under the proposals in this Bill, the number of members for that State will rise from 45 to 46. In Victoria, the determination was 33.76 and the number of members will remain at 34. The entitlement of Queensland was 17.44, and the number of members will rise from 17 to 18. In South Australia, the determination was 11.17, and the number of members will rise from 11 to 12. In Western Australia, the entitlement was 8.47, and the membership will rise from 8 to 9. Tasmania, under a special provision of the Constitution, retains five members. Under the entitlement arrived at by the Chief Electoral Officer following the 1961 census, the number of members for the House of Representatives was 120. Under this Bill, the number will rise to 124.

The Leader of the Opposition (Senator McKenna) has moved an amendment to the motion that the Bill be now read a second time. The wording of his amendment is -

Leave out all words after “ That “, insert:-“ the Senate is of opinion that a decision on the proposal contained in the Bill should be deferred until the Government introduces other electoral legislation announced in the Governor-General’s Opening Speech and until the people hare been given an opportunity to vote at a referendum on the Constitutional Review Committee’s proposals on Commonwealth legislative machinery

I note that Senator McKenna, while putting forward the amendment, has in effect said that the Opposition will not press it to a division.

Senator McKenna:

– I did not say that. I said that we would not oppose the Bill if the amendment were not carried.

Senator ANDERSON:

– Very well. The whole debate has been conducted in a detached way as befits the Senate when considering matters of this nature. The Government is not prepared to accept the amendment proposed by the Leader of the Opposition and I shall give the reasons for this decision. I want to make an analysis of the amendment, as I see it. Reference has been made to the Speech delivered by the Governor-General when he opened this Parliament. It was announced in His Excellency’s Speech that there would be certain electoral reforms. This announcement had its genesis in the policy speech delivered by the Prime Minister (Sir Robert Menzies) on 12th November 1963. The policy speech gives some background to the proposition which is encompassed in the amendment. The Prime Minister said -

The Statistician, in dividing the electorate) quota into the population of each State, to determine how many seats in the House of Representatives that State is to have, is at present bound to find that if the division leaves a fraction less than onehalf, the State does not get a seat for that fraction. This means, at present, that growing States, like Queensland and Western Australia, and even New South Wales, stand to lose a seat. This is, we think, wrong. We therefore propose to amend the Representation Act to provide that any surplus fraction will equal one seat. In consequence no State will lose a seat.

I point out to the Senate that, to that extent, this Bill does that very thing. It provides that a State shall obtain an additional member for any fraction of a quota. This provision has the effect of increasing the membership of the House of Representatives from 120 to 124. The Prime Minister went on to say -

Again, we will amend the Electoral Act by making it clear to the Redistribution Commissioners that, in exercising their discretion to vary tha normal electoral quota up or down, to allow for some variation between compact metropolitan seats and very much larger rural areas, they shall specifically take into account, community of economic, social and regional interests, difficulties of communication, remoteness or distance, tha trend of population changes, physical features, and the relative areas of the proposed Divisions.

I take it that this is What the Leader of the Opposition is referring to in his amendment when he says that this Bill should bc deferred until that provision is included in the legislation. But surely we can say that the most logical thing to do insofar as that aspect of the amendment is concerned is to take first things first, as we are doing. We are bringing into being the situation where the number of the members of the House of Representatives will be determined by the provisions of the Bill.

Senator McKenna then went on to refer to the proposals of the Constitutional Review Committee. I should like to make some reference to those proposals, because if we are to accept the submission in the amendment and wait until those proposals are carried out, we shall need to envisage a timetable which, I contend, is not within the realm of possibility, bearing in mind that the House of Representatives is elected triennially and already approximately 12 months of its life has elapsed. The Constitutional Review Committee recommends that the Constitution should be amended to provide as follows -

  1. The number of members of the House of Representatives should be no longer tied to being as nearly as practical twice the number of senators.

Incidently, I understand that the only other country where there is this nexus between the numbers in the two Houses is Norway. The Committee further recommended -

  1. The Parliament should have power to determine the number of senators, provided equal representation of the original States is maintained, but there should be not less than six nor more titan ten senators for each original State.

That is germane here. The third recommendation was -

The Parliament should continue to have power to make laws for increasing or diminishing the number of members of the House of Representatives, and the number of members chosen in the several States should remain in proportion to population. However, the power of the Parliament to determine the number of members of the House of Representatives should be subject to the qualification that the number of members to be chosen in any Slate should be determined by dividing the population of the State by a figure determined by the Parliament which is the same for each State and is not less than 80,000, thus providing that there should be on average at least 80,000 people for every member. Where, upon a division, there is a remainder greater than one-half of the divisor, there should be an additional member to be chosen in the State concerned. (4). The power of the Parliament referred to in sub-paragraph (3) above should be subject to the present constitutional provision that there should be no less than five members chosen in each original State. 1 shall come back to that in a moment. Paragraph 111, which deals with draft constitutional alterations, reads -

Several amendments would be necessary to implement the Committee’s recommendations.

Paragraph 113, which deals with the number of members of the House of Representatives, reads - lt is convenient, in translating the Committee’s proposals affecting the House of Representatives into draft alterations, to repeal sections 24-27 inclusive of the Constitution and to replace them by a new section. A draft alteration to this end is as follows: - 24. (1.) The House of Representatives shall be composed of members directly chosen by the people of the Commonwealth. (2.) The numbers of members of the House of Representatives to be chosen in the several Slates shall be declared by the Parliament from time to time in accordance with this section. The numbers of members for all the States shall be declared at the one time. (3.) The number of members to be so declared in respect of a State shall be the number ascertained by dividing the number of the people of the State by a number prescribed by the Parliament from time to time, being not less than eighty thousand and being the same number for each State. If, on such a division, there is a remainder greater than one-half of the divisor, the number of members shall be increased by one, but otherwise any remainder shall be disregarded. (4.) In the application of the last preceding sub-section in relation to a law declaring the numbers of members to be chosen in the several States, the respective numbers of the people of the States shall be taken to be the numbers declared by that law to have been those numbers, according to statistics of the Commonwealth, at a specified date, not being earlier than the date at which the latest census of the people of the Commonwealth was taken under the law of the Commonwealth. (5.) Notwithstanding anything contained in this section, the number of members of the House of Representatives to be chosen in an original State shall be not less than five.

I draw special attention to that sub-section, because if affords a clue to the constitutional probabilities of this Bill. It is significant to note that the Constitutional Review Committee wrote that provision into the draft alteration. The remainder of the draft reads as follows - (6.) Where an alteration is made to the number of members to be chosen in a State, the alteration does not apply in relation to any election before the first general election takes place after the GovernorGeneral in Council has by Proclamation declared that there is an appropriate number of electoral divisions for the purpose of the election of the altered number of members. (7.) The Parliament may make laws for carrying this section into effect.

The purpose of the amendment moved by the Leader of Opposition is to defer the proposal contained in the Bill until complementary legislation is introduced. The honorable senator’s main argument was based on a proposal for constitutional review which would have to be submitted to a referendum before it could be submitted to the Parliament.

The Government would have to consider any proposal for a referendum as a matter of policy. I am not competent to comment on that aspect of the matter at this stage. The Government has stated that it is still examining the vast implications of the report of the Constitutional Review Committee. Even if the matter of electoral reform were submitted to a referendum, there is still grave doubt about the end result. The history of referendums in the Commonwealth of Australia has not been one of great success. Senator McKenna would be much more competent than I to outline the referendums that have been held since Federation and the degree of success that has been achieved. Indeed, Senator McKenna would agree that there has been some difference in the viewpoints expressed this afternoon about the status of the smaller States. We know that the founding fathers, at a series of conventions held for the purpose of drafting the Constitution, had to try to evolve a system which would meet the wishes of certain States that felt they might be swallowed up by the larger States. I repeat that, if the proposals contained in the report of the Constitutional Review Committee were submitted to the electorate, there is no certainty about the outcome.

Let us think of the suggestion in terms of time. The holding of a referendum takes a lot of time. If we were to follow the normal pattern, the holding of a referendum on constitutional reform could be a long process. If the result was a degree of success and a degree of failure, the Government would then have to make a proper analysis of the result and translate it into legislative form. The final proposal would still have to run the gauntlet in the Parliament. The great length of time involved in dealing with the matter in this way would quite clearly prejudice adherence to the normal triennium between the holding of elections, the next of which is some two years away.

The Leader of the Opposition has raised the constitutional validity of the proposal contained in the Bill. The Government, which does not make its decisions lightly, holds the view that the Bill is constitutionally sound. The fact that the Government has introduced the measure indicates its confidence in that respect. Senator Prowse got right on to the target when he pointed out that section 24 of the Constitution makes provision for a variation.

The Government believes that this is a good piece of legislation and that it will meet the objections that have been raised to the previous proposal. The validity of the objections has been considered in the drafting of the present legislation. I have no doubt that the Leader of the Opposition has moved his amendment in good faith, but it does not warrant support, as I have sought to show by reference to the recommendations of the Constitutional Review Committee. The amendment would hardly be practical at the present stage of the triennial electoral period of the House of Representatives.

Question put -

That the words proposed to be left out (Senator McKeima’s amendment) be left out.

The Senate divided. (The Deputy President- Senator G. C. McKellar.)

AYES: 19

NOES: 24

Majority . . . . 5

AYES

NOES

Question so resolved in the negative.

Original question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

Sitting suspended from 5.38 to 8 p.m.

page 1534

STATES GRANTS (SPECIAL

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Henty) read a first time.

Second Reading

SenatorHENTY (Tasmania - Minister for Civil Aviation) [8.0]. - I move -

That theBill be now read a second time.

The main purpose of this Bill is to authorise the payment in 1964-65 of special grants totalling £15,860,000 to the States of Western Australia and Tasmania. The payment of these grants has been recommended by the Commonwealth Grants Commission in its thirty-first report which has already been tabled. The Bill also authorises the payment of advances to Western Australia and Tasmania in the earlier months of 1965-66 until such time as Parliament authorises the payment of special grants for that year. A similar provision has been included for a number of years in the legislation authorising payments of special grants to the claimant States.

Under the procedures currently employed by the Commission, the special grants recommended for payment each year consist of two parts. One part is an advance payment based on the Commission’s assessment of a claimant State’s financial needs for the year in which the grant is to be paid. This part is subject to final adjustment two years later when the Commission has completed its examination of the audited results of the States for that year. The other part of the grant represents the final adjustment of the advance payment made two years earlier.

In accordance with its usual practice, the Commission has arrived at its recommendations by making detailed com parison of the Budgets of each of the claimant States with those of the standard States, particular account being taken of differences in levels of expenditures and efforts to raise revenue. As in the three preceding years, the Commission has taken the States of New South Wales and Victoria as the standard States for the purpose of these comparisons. The special grants which the Commission has recommended for payment in 1964-65 and the special grants paid in 1963-64 are set out in a table which, with the permission of the Senate, I shall have incorporated in “ Hansard “.

In deciding the adjustments to the advance payments made to the claimant States in 1962-63, the Commission examined the Budget results of the standard States of New South Wales and Victoria and adopted an amount of 5s. 6d. per capita as the deficit budget standard to be applied in respect of that year. After comparing the level of services and charges, the Commission has recommended grants which would have the effect of leaving Western Australia with a small deficit to fund and Tasmania with a balanced Budget result for 1962-63.

In arriving at its recommendations as to the amount of the advance payments which should be made to the claimant States in a financial year, the Commission makes a forecast of the amount of financial assistance likely to be justified for the year of payment. To estimate the likely budget standard for that year, the Commission examined the budget prospects for 1964-65 of the two standard States, New South Wales and Victoria, and concluded that, on the basis of existing policies, a deficit standard for 1964-65 would be appropriate. The advance payments recommended by the Commission would, on the basis of preliminary estimates submitted by the claimant States, leave both of them with prospective Budget deficits in 1964-65.

In total, the special grants recommended for payment in 1964-65 are £4,410,000 greater than those paid in 1963-64. The effect of adopting the Commission’s recommendations would be to increase by about f 7,040,000 the total general revenue grants - that is, the financial assistance grants based on the Commonwealth Statistician’s latest estimates plus the special grants - payable to the two claimant States this financial year. For Western Australia the increase would be approximately £4,484,000 and for Tasmania approximately £2,556,000.

The increase of £4,410,000 in the special grants recommended for payment to Western Australia and Tasmania in 1964-65 arises partly because, on the basis of its assessment of the Budget outlook for the two standard States, the Commission adopted a much lower deficit budget standard for 1964-65 than that adopted for 1963-64. In addition, the Commission adopted a new method of comparing the levels of expenditure on social services in the claimant and standard States which has yielded a result considerably more favorable to the claimant States than the method previously employed.

The Grants Commission’s recommendations have been adopted without amendment in every year since the Commission was established in 1933. The Government considers that the Commission’s recommendations regarding special grants for Western Australia and Tasmania in 1964-65 should bc adopted. I therefore recommend the Bill to honorable senators.

Senator McKENNA:
Leader of (he Opposition [8.6]. - The Opposition has pleasure in supporting this measure. The Bill has two main purposes. Although they have been adverted to by the Minister for Civil Aviation (Senator Henty · Tasmania

, I shall touch on them again. The first is to authorise the payment of £15,860,000, being £8,560,000 to Western Australia and £7,300,000 to Tasmania, less the amounts that already have been advanced in this financial year. The second purpose is to authorise payments in the first six months of the next financial year pending receipt of a recommendation from the Commonwealth Grants Commission.

As the Senate knows, these grants are made under section 96 of the Constitution and are made, I am happy to say, without conditions of any kind. Many factors are looked at by the Commission in determining the quantum of its recommendations, but ultimately, when the amount is paid over by the Commonwealth to the States the States are completely free to do what they will with the grants. We have the contrary experience - I am not complaining about it, but merely directing attention to it - in relation to grants that are made upon specific conditions, such as grants to universities and for various other purposes, sometimes of a capital nature, lt is wise that the Commonwealth, in earmarking moneys for particular purposes, should take precautions to ensure that the moneys reach the objects to which the Commonwealth intends that they be directed. The amounts with which we are concerned in this Bill are based on the thirty-first report of the Commonwealth Grants Commission. The Commission is a body which, by the excellence of its work down the years, commands the respect of this Parliament. It has done so at all stages of its existence. As the

Minister indicated, there has never been an occasion since the Commission was established in 1933 when the Parliament has not readily accepted its recommendations and acted on them.

In recent years the claimant States, as they are called, have numbered two instead of three, as formerly. South Australia some years ago, was happy to escape from the close examination of the Commonwealth Grants Commission, and a further change was effected in recent years in that whereas earlier the Budgets of the claimant States had been compared with those of the standard States of Queensland, New South Wales and Victoria, now the standard is set by only New South Wales and Victoria. So it is a matter of the two claimant States, Western Australia and Tasmania, being brought to approximately the budgetary level enjoyed by New South Wales and Victoria.

The Commission has, throughout its history, consistently applied one principle. That principle, which I have already broadly stated, is to bring the claimant States up to relatively the standard of the standard States. But it is not fair to the Commission to state the principle broadly, and I propose to take a moment to state it in the Commission’s own terms. The Commission really has chosen the principle of financial need and it has rejected the earlier claim made by the States for consideration because of financial difficulties suffered through Federation itself. That second claim has been in the discard for a very long period. At page 37 of its current report, the Commonwealth Grants Commission expresses the principle in this way -

Special grants are justified when a State through financial stress from any cause is unable efficiently to discharge its functions as a member of the Federation and should be determined by the amount of help found necessary to make it possible for that State by reasonable effort (o function at a standard not appreciably below that of other States.

Every word of that has, of course, been very carefully considered by the Commission. But whilst the principle on which the Commission acts has remained unchanged, its methods have varied from time to time. That is a fortunate circumstance, particularly for the claimant States this year, as I hope presently to show. All the time the Commission is considering submissions from the States and from the Commonwealth

Treasury, making up its own mind and putting forward proposals for consideration. Its ideas are never just foisted upon the States or the Commonwealth. The Commission has the happy knack of tossing into the ring, if I might resort to the vernacular for a moment, a particular thought and of giving the States and the Commonwealth Treasury an opportunity to consider it and present arguments for or against it. The Commission never makes a change in its methods hastily. As far as I can recall, it has never made such a change without consulting all the people who are interested. That has created a very happy atmosphere.

The report of the Commission is invaluable to anybody who is interested in the complex problem of CommonwealthState financial relations, which has always had a particular fascination for me. The Senate will recall that I have addressed myself at very great length to this subject down the years. The Commission has made a great contribution to the preservation of standards of governmental services throughout Australia on a relatively even basis. The Commission can take pride in the fact that as we move round Australia we find our citizens functioning at a pretty even standard so far as social services, health, law and order, safety, severity of non-income taxation and matters of that kind are concerned. There are differences in particular items between the various States, but, by and large, the Commission, by the care with which it has addressed itself to this task, has ensured that, within the limits that the States care to choose, the citizens of all States may enjoy almost comparable standards. That is something that gives me very great satisfaction, and I am sure that it satisfies all members of this Parliament.

The Commission has at all times carefully guarded its independence. It is not subservient to the Commonwealth Treassury, nor is it subservient’ to the States. The grant for each year, as the Minister indicated, is in two parts. The Commission very wisely has decided not to work upon the accounts of the standard States, or even of the claimant States, until they have been subjected to audit by the AuditorGeneral of the various States. It has addressed itself to the task of making what ever adjustments it thinks proper to bring about a true basis of comparability between the claimant States and the standard States. In this year, 1964-65, the Commission, first of all, went back to the accounts for the year 1962-63. It looked at the audited results for that year of the four States involved in this matter. Having made all the adjustments that it thought proper, after discussing them with the claimant States, the Commission decided that there should be some addition to or subtraction from the broad grant that was made in 1962-63. On this occasion the first part of the adjustments - that is, those relating to 1962-63 - resulted in a payment of £660,000 to Western Australia and of £491,000 to Tasmania.

Senator Wright:

– On what head?

Senator McKENNA:

– In 1962-63, which is two years ago. In dealing with the first part of the grant for a current year, the Commission has always concerned itself to adjust the grant made two years before, for which it has audited results. If any honorable senator cares to look at the report of the Commission, he will see that at page 90 it has reached its conclusions regarding the making of the grant. After examination of the budgets of the standard States, it sets a deficit of 5s. 6d. per capita as the proper standard to be applied in the claimant States. The Commission sets out how it has arrived at the various figures. It makes favorable or unfavorable adjustments for comparative expenditure on social services, for severity of taxation and for differentials caused by the activities of State business undertakings. At page 90 of the report the Commission shows the detail which resulted in the grants of £660,000 to Western Australia and £491,000 to Tasmania.

The second parts of the grants are made on a broad assessment of what will be tha budgetary position of the standard States. There is a lump sum recommendation, based not on guess work but on a pretty intelligent assessment, so far as intelligence can introduce some accuracy into events that are not concluded. The second parts of the grants are the major parts this year. Pursuant to its policy, the Commission has given £7,900,000 to Western Australia and £6,890,000 to Tasmania. Those two grants, added to the grants to which I have already adverted, comprise the total of £15,860,000 that is to be made available to the two States under this Bill.

I have referred to the fact that the Commonwealth Grants Commission brings the budgets of the claimant States to a position comparable with those of the standard States. Never at any time in my recollection, when the standard States achieved surplus budgets, has the Commission brought the claimant States up to that level. The Commission has treated them to a balanced budget or to a deficit budget. It has never been within the thought of the Commission to give to the claimant States surplus budgets, if that were the average budgetary result of the standard States.

Senator Morris:

– Nor should it.

Senator McKENNA:

– I agree with that. I do not say that it should. If a State sees fit to have certain expenditure and certain revenues, that is entirely a matter for the State. The State can learn by seeing what happened and by developing as it wishes. I assure the honorable senator that I was merely recording the fact - I was not voicing a complaint against the Commission or the Commonwealth - that the claimant States were not brought to a surplus balance sheet. We must leave certain things to the determination of the States.

T promised to refer to a new development in the methods of the Commission. For a considerable time, in matters such as social services, it has been taking its standard in the standard States as being so much per capita of the population of those States. It has then added to the figure so determined a percentage that was thought proper, having regard to the geographic, demographic, climatic and other aspects in the claimant States. After discussion with the various bodies interested, it has now made a proposal to which it gives effect, tentatively at least, in this report, when it says, “We shall endeavour to get down to the unit cost per school child in State schools, in making the. comparison on education between the claimant States and the standard States”. The Commission, of course, is seeking greater accuracy. It is going into the matter more closely. It also segregates matters of transportation of school children and again makes a per unit cost comparison between the claimant States and the standard States. It is most interesting to traverse the argument which the Commission uses and to see how it arrives at these results.

I propose to take just a minute or two to refer to several paragraphs, in particular to paragraphs 71, 72 and 73. The Commission points out that its starting point is to take net expenditure by the standard and claimant States in the whole field of education, excluding universities, the transportation of school children and libraries. It then converts these net expenditures into a single item of cost per child, calculated upon the number of children actually attending Government schools. It states -

Allowance is made in these calculations for the higher school commencing age in W.A. and the higher school leaving age in Tasmania.

Paragraph 71 reads -

With regard to the cost of transportation of children to schools .the Commission started from the consideration that the bases of concessions in this social service are markedly similar in the claimant Slates and in the standard Slates except in N.S.W. where a charge is made to parents whose children are carried on contract buses. The concessional fares on the public transport services have now been brought into line by the claimant Stales wilh those prevailing in the standard States. The costs of carriage of children in buses contracted for by the Education Departments depend no doubt upon various factors affecting motor transport in each State. At the present stage the Commission is not aware of any reason for supposing that these contracts are not “ let “ upon the normal rates prevailing in each locality.

Paragraph 72 reads -

Nevertheless the cost of transportation per school child is conspicuously higher in each of the claimant States than in the standard States. To some extent the differences in these costs may bc due to the more elaborate systems of public transport in the standard States resulting in lower costs per child. Again, the longer distances travelled in Western Australia may result in higher costs. Some difficulties may also arise from circuituous “ hilly “ routes which are unavoidable in some areas of Tasmania. All these considerations might indicate that the Commission should allow to the claimant States the higher cost of transportation for each child, lt may be, however, that the process of consolidation in rural schools has resulted in economies in the side of education but higher charges in relation to transportation. The claimant States enjoy favourable consequences from the former economies. The Commonwealth Treasury has pressed the view that some countervailing unfavourable consequences in transportation costs should not be overlooked. Taking a broad view of the whole situation the Commission has decided as a provisional estimate to allow only part of the additional transportation costs per school child mentioned above. In the case of Western Australia a total sum on this account of £242,000 has been excluded from the expenditure of the State out of a total of £422,000, and in the case of Tasmania the sum excluded amounts to £136,000 out of a total of £294,000.

Paragraph 73 reads -

The details of the relevant calculations have been communicated to all parties concerned so -that further research can be conducted into this matter. The Commission is satisfied that ample margin has been reserved by this process for the results of further investigation and that notwithstanding the provisional nature of this estimation the calculation of relative costs of educaton in the claimant States and the standard ‘States is more satisfactory than by the method employed in the past. Further debate may eliminate the area of uncertainty which for the present must be accepted.

I think that that is a very good example of the way in which the Commission works.

Senator Prowse:

– Does the honorable senator agree with its conclusion on reducing the amount allowed in that case?

Senator McKENNA:

– Having regard to the fact that the Commission has not made a final determination and the matter is still -in flux, I would not care to say whether I agreed or disagreed. I prefer to say that I am unhappy that the Commission did not allow the whole amount, but it has put before the Parliament quite objectively the considerations that it has in mind.

Senator Wright:

– What does the honorable senator mean when he says that it did not allow the whole amount?

Senator McKENNA:

– In making its calculations as to the comparative severity of a case and the allowing of an expenditure. It is difficult to put the position, otherwise than in the way in which the Commission itself puts it.

Senator Wright:

– It is like a case in which A claims £1,000 and the judge awards £500.

Senator McKENNA:

– Very much except that the State itself has incurred the expenditure and not all that is taken into account by the Grants Commission. I shall read from its conclusions in relation to Tasmania in one case to illustrate my point. -The Commission stated in its thirty-first report - in the case of Tasmania the sum excluded amounts to £136,000 out of a total of £294,000.

That means, excluded from the deficit. Senator Wright. - That is nearly half.

Senator McKENNA:

– Yes, very nearly half, so that the £294,000 which constituted part of Tasmania’s true deficit, was reduced by £136,000. I think that what I have read to the Senate illustrates the methods of the Commission. They are tentative still, even at this stage. The Commission does propose to apply that particular method to hospitals to take the per patient cost instead of the per capita cost based on population.

Senator Morris:

– The Commission will have some problems there.

Senator McKENNA:

– I have no doubt, but there are problems about anything that is an ingredient of CommonwealthState financial relations. There is no aspect of that matter which does not involve problems and I think the Commission does a wonderful job to reach its conclusions in the face of all the difficulties it encounters. But the point I am making is that this new method has had the most happy results for Tasmania and Western Australia. Calculating the social services adjustment upon the new unit cost per child puts Tasmania for the first time in my recollection - and it may be for the first time overall - in a position where it gets a favorable adjustment in relation to its social service payments. Tasmania has by far the highest expenditure per capita on education and that usually leads to an adverse adjustment being made to the grant to bring Tasmania down to the level of the standard States. On this occasion - I refer to page 87 of the thirtyfirst report - there has been a favorable adjustment. The expenditure on social services has resulted on this occasion in a favorable adjustment of £25,000 to Western Australia and of £190,000 to Tasmania. So the claimant States may well be happy with that.

Just before coming into the Senate I checked the reports of the Grants Commision for the past three years. I found that last year there was an unfavorable adjustment for Tasmania of £183,000 and for Western Australia of £481,000. There was a big difference between the two years I have mentioned. That unfavorable adjustment was recorded in the report for 1963. For the record, I direct the attention of the Senate to the fact that the year before, Tasmania had an unfavorable adjustment of £46,000 and Western Australia had an unfavorable adjustment of £436,000. The report for 1961 shows that in the year under review, Tasmania had an adverse adjustment of £204,000 and Western Australia had a small surplus of £27,000. So it appears that in addressing itself more meticulously and minutely to the problem of these adjustments, the Grants Commission has conferred a real benefit on the two claimant States in this particular field.

Senator Wright:

– They are not very explicit as to the reasons for reversing that approach, are they?

Senator McKENNA:

– They are not explicit in the report and the hesitation of the Commissioners is caused by their obvious desire to see, for example, in the case of Tasmania, how far the gathering of school children into central area schools has resulted in economies which the Commission ought to take into account, and whether the Commission should not set the economies achieved by that centralisation against the higher costs of transporting school children long distances to the central spot. Looking at it mathematically, it is a proper consideration for the Commission. I would hope that the Commission’s mind finally will fall upon taking into account the whole question of transportation costs and seeing that Tasmania gets an even more favorable adjustment than it gets at present because unquestionably the matter of transportation has more grave difficulties for that State for a number of reasons - some of which have been mentioned by the Commission - than would occur on the mainland States.

I resist the temptation to pursue this interesting topic any further and conclude by indicating that the Opposition supports the Bill. I express appreciation personally to honorable senators from other States who have joined in supporting these grants. I should like to express my appreciation to the Grants Commission for its work and its report, and my thanks to its competent and devoted staff for the excellent work I know that it does.

Senator LILLICO:
Tasmania

– I listened with interest to the Leader of the Opposition (Senator McKenna) and his references to the activities of the Grants Commission. I believe it is a fact that for the first time, Tasmania does not suffer an adverse financial correction because of its expenditure on social services. In that respect, the new approach of the Grants Commission must confer a very distinct benefit on the claimant States. I call to mind that for many years the great bugbear in the finances of the Tasmanian Government was the adverse correction suffered in respect of social services, education and similar expenditure. However, I must endorse what the Leader of the Opposition has said about the Grants Commission. As the Minister for Civil Aviation (Senator Henty) pointed out in his second reading speech, the Grants Commission’s recommendations have been adopted without amendment in every year since the Commission was established in 1933. That means its recommendations have been accepted by all Governments without reservation or qualification.

The Grants Commission has been operating for 31 years. It holds a unique position so far as the Commonwealth Government and the claimant States are concerned. That is somewhat unusual because one would think that a commission charged, not with expenditure but with the recommendation of expenditure, would come in for a good deal of adverse criticism. However, in my years in the State Parliament I have heard the work of the Grants Commission highly commended from time to time by the Parliament of Tasmania.

One cannot help but think how different was the position that existed prior to the establishment of the Commonwealth Grants Commission. In those days, whenever the position became desperate I believe it was a case of the Premier or the Treasurer of Tasmania waiting upon the Commonwealth Treasurer and seeking assistance from the Commonwealth Government. I can remember reading a report in the Press about a then Premier of Tasmania waiting upon the Commonwealth Treasurer and putting his case for assistance for that State. According to the report, the Treasurer was not in a very good humour that day and when the Premier said that he had come to see him about Tasmanian affairs the Treasurer replied: “ Damn you, and Tasmanian affairs “. That was the report that appeared in the Press. A lot of time was occupied in compiling cases in detail showing the disabilities suffered by Tasmania under Federation - disabilities brought about by the tariff policy imposed upon the whole of the Commonwealth, which benefited some States and inflicted penalties on others; disabilities brought about by the Navigation Act; and disabilities brought about by other factors. I call to mind that the late Mr. E. Dwyer-Gray was one who concentrated very much on the disabilities suffered by Tasmania - Tasmania was his Stale - as a result of its membership of the Federation of Australia. It was left to a man who had been Premier of Tasmania - the late Mr. J. A. Lyons, who became Prime Minister of the Commonwealth - to establish the Commonwealth Grants Commission, which has continued operating ever since and has removed all the contention, the bitterness and the ill feeling that existed because the claimant States felt that they were being just dragged along in the wake of the standard States and were suffering a penalty because of their membership of the Federation. Here was a man who had had experience on both sides of the fence. It was due to him that the Grants Commission was established. It has carried on ever since. We now have before us the Commission’s 31st report. The Commission’s methods are complete and its inquiries are exhaustive and thorough. It looks into almost every aspect of State finances and, as Senator McKenna has explained, it recommends adjustments in the finances of the claimant States.

Although the honorable senator has pointed out that every State Government is the captain of its own ship in that it can do what it likes, let me say that in the imposition of State taxes and in the expenditure of funds by the States a very close weather eye is kept upon the Commission. I can remember an occasion when certain expenditure was deemed to be valid and the State thought that it could proceed in a certain direction because it believed the Commission would approve the expenditure. But the State found itself in difficulties. In spite of the Commission’s thoroughness and its fairness - no-one can deny that it is fair - in its comprehensive reviews of State finances, because of the necessity to have a yardstick by which to measure the grants that shall be paid to the claimant States, certain anomalies creep in. I remember an occasion when there was a lot of heart-burning. Tasmania suffered a correction because of the funds that were devoted to subsidising extensions of hydroelectric power into rural areas. That went on for many years. In passing let me say that the Metropolitan Transport Act, which applies to both Hobart and Launceston, confers a very distinct benefit on both those cities.

Senator Wright:

– To the exclusion of the country areas.

Senator LILLICO:

– To the exclusion of the country areas. In this report the Commission states that because the losses of the Metropolitan Transport Commission in both Hobart and Launceston are comparable with the losses sustained in the standard States, no correction will be made. However, in the same report the Commission refers to the subsidising of extensions of hydro-electric power into rural areas and, when dealing with the correction states -

Briefly, the reason for making such a correction was that similar expenditure was not borne in the other States, except in part by New South Wales.

It seemed to us at the time that the Commission was adhering very closely to the yardstick when consideration was not given to the fact that the other States did not have the necessary potential for such rural extension, did not have the closer settlement that we had and did not have our resources of hydro-electric power. In any case, the Commission goes on to say -

In past years, Tasmania has submitted to the Commission that corrections and adjustments should be considered together and that a claimant State should be entitled to offset any adverse correction, such as this against a net favourable adjustment . . . Although adhering to this principle, the Commission has given further consideration this year to the treatment of this special correction in Tasmania . . . With only two standard States, with contrasting procedures on the subject matter, some greater force resides in the Tasmanian contention that it should be enabled to avoid the prejudicial effect of a correction for the items under review.

The Commission concludes this portion of its report in these terms -

The Commission considered that it would not require Tasmania to fund the amount of this expenditure, £56,000, incurred in 1962-63, as had been required in previous years. It took the view thar Tasmania had a net favourable adjustment in excess of the deficit standard in 1962-63 and it would not be equitable to expect the State to fund the amount at this stage because of the proposed new legislation and the proposal of the Commission further to consider adjustments for deficit funding in its next report.

I do not know what the proposed new legislation is that the Tasmanian Parliament intends to introduce to alter the principle which has been adopted.

Senator McKenna:

– The Commission states very plainly in paragraph 146 on page 79 of its report that the legislation is designed to relieve the Consolidated Revenue Fund of any responsibility to contribute to the cost of these rural extensions in future years.

Senator LILLICO:

– It appears that the money will have to come out of the funds of the Hydro-Electric Commission.

Senator McKenna:

– I should think it would come from loan funds.

Senator LILLICO:

– Perhaps it will come from loan funds. At long last the State will be relieved of the penalty which has been imposed upon it, by reason of this adverse correction, because it assisted in the extension of hydro-electric power into rural areas.

Senator Henty:

– It was not the fact that the State Government assisted but it was where it assisted. The Grants Commission is saying: “ You may not assist out of the Consolidated Revenue Fund, but you may assist out of loan funds.” The Tasmanian Government continued to assist from Consolidated Revenue and it copped the penalty.

Senator LILLICO:

– Because that position has been altered, I take it that it will be much easier for the State of Tasmania so far as rural expansion is concerned.

Senator Henty:

– The legislation should have been passed long ago.

Senator LILLICO:

– Yes. While the Grants Commission insists, and rightly so, that State taxation imposed by the claimant State be levied at a rate comparable with that of the standard States, it is interesting to see that both Western Australia and Tasmania have levied State taxation at a rate in excess of that of the standard States. In the year 1962, had Western Australia levied State tax at the same rate as that of the standard States it would have collected £217,000 less. Tasmania, although it has less than half the population, I think, of Western Australia-

Senator Wood:

– It is losing population, too.

Senator LILLICO:

– No, it is not losing population. If Tasmania had more people like Senator Wood, the State would gain population. While Western Australia would have collected £217,000 less had it levied State taxation on the same rate as the standard States, Tasmania would have received £218,000 less. That makes the Tasmanian taxation pretty savage when you compare the small population of Tasmania with that of Western Australia. In 1963, the same position applied. State taxation in Western Australia would have been £106,000 less and in Tasmania it would have been £194,000 less had it been levied at the same rate as that of the standard States. In the year dealt with in the last report of the Grants Commission, Western Australia would have received £117,000 less and Tasmania - I do not know what has caused the drop - would have received £72,000 less.

But that is not the whole story. A lot of the State taxation in Tasmania is based on the valuations that are made there. This is a factor which the Commission cannot be expected to take into account. In the State of Tasmania, there has been a revaluation of land. So far as rural properties are concerned, those valuations are, in my opinion, fictitious. They have yielded a great amount of money by way of probate duty and land tax. The policy of the Valuation Branch in Tasmania with respect to rural properties is to take into account the sale of properties in a neighbourhood and to value all other properties in that neighbourhood at the rate at which those properties have been sold. This method has caused the very basis upon which this form of taxation is levied to be increased drastically. In some cases the increase is 40 per cent.

Senator McKenna:

– Would not that be reflected in the severity of taxation per capita?

Senator LILLICO:

– My understanding of the position is that the Grants Commission takes into account the rates of taxation. As far as I can see, it does not lake into account the valuations upon which that taxation is imposed. I believe that the Valuation Branch, on seeing that a farm has been sold for a substantial sum, increases the valuations of all other properties in the neighbourhood. It supposes that the sale price of the particular property represents its true valuation. Nothing could be further from the truth. Properties are sold for a number of reasons. I have heard of extraordinary prices being paid because a neighbour has wanted to buy a property which has a good running creek on it. I have heard of other properties being purchased for sentimental reasons. A property is put on the market and stays there until it is sold. The seller waits until the man comes along who wants that property sufficiently to offer the best price. This is no criterion whatever as to the value of the properties in the neighbourhood. In fact, I believe that people who own some farm properties on which valuations have been increased would not lose an opportunity to sell their property for the capital value fixed by the Valuation Branch.

Senator Benn:

– What method should be adopted to fix valuations?

Senator LILLICO:

– That is one of the anomalies in the activities of the Grants Commission. I believe that the Commission could hardly be expected to take fully into acount the fact that valuations differ from State to State. So far as I can see, the Commission does not do so. But this fact does make the severity of State taxation higher than it otherwise would be.

In the main - in fact, I could say overall - the State of Tasmania has been fairly treated. I believe this is as a result of the Grants Commission. In my time here, I have never heard a senator from any party make any complaint about the treatment meted out to the State. It is true that some people maintain that everything is not just quite right in Tasmania. Only today I saw in the “ Australian “ an article that interested me very much. This has a distinct bearing on the assistance that the State of Tasmania will need from the Grants Commission. The article commences with the question -

Is Tasmania in danger of drifting to the position or being Australia’s “Hill-billy State”?

A special article in tomorrow’s issue of The Australian examines factors which are delaying the island’s development.

Then, the “ Australian “ sets out questions that will be asked and answered. I do suggest that before any newspaper prepares to publish an article such as this it should make sure that its premises are completely sound. The article continues -

Why is Tasmania losing to the mainland industries which are large labour users, while unemployment is at a high rate compared with the rest of Australia?

The answer to that question is simple. The question can be answered in one word - freight. Freight charges between Tasmania and the mainland have been the greatest impediment to the progress and advancement of that State. If I may say so, that handicap has been aggravated by the attitude of the .waterside workers. I do not altogether exclude the shipping companies from blame. Only this week I heard two large concerns say that Tasmania markets only 3 per cent, of its products within the State. Almost all our products have to be transported over the sea to other markets. That is why freight and conditions on the waterfront, which have penalised Tasmania for a long time, are an important factor in the relative prosperity of that State.

This article in the “ Australian “ poses the further question -

Why is the gross value of Tasmania’s main crops declining?

It is scarcely correct to say that the value is declining. If we look at the statistics at the end of the report of the Commonwealth Grants Commission and examine the whole ambit of Tasmania’s production, we find that, although there have been fluctuations, the production of almost every commodity has shown a gradual upward trend. The gross value of Tasmania’s main crops is not declining. That remark applies to wool, meat, milk, butter and the production of every other commodity with the exception of potatoes, the value of which has shown a very sharp decline, again as a result of freight charges. I can recall the time when one could put potatoes on the Sydney market for 30s. a ton. Today the figure is between £10 and £12 a ton. Tasmania grows the best potatoes in Australia, but the Tasmanian potato grower has been priced out of the Sydney market to which formerly he sent his potatoes as far back as I can remember. Then the article raises this ridiculous question-

Why are there fewer pupils over 16 in Tasmania’s secondary schools than the number of students at the State’s solitary university?

I take it that is because soon after the age of 16 years most boys and girls go to the university.

In making these comments 1 am not saying for one moment that the State’s progress could not have been very much greater. One of the disabilities from which Tasmania has suffered has been 30 years of administration by a government that has become stagnated. A change of government in that State would be like a shot in the arm. Much could be done to develop the tourist industry. In Tasmania we have a full-blown Minister for Tourism who has jurisdiction over the expenditure of, I understand, £20,000. A lot could be done to develop this industry. Although Tasmania is suffering from the effects of high freight charges, a bill now before the Tasmanian Parliament seems to indicate that the Government is bent on imposing a still greater burden on industry. The position is not as bad as this article in the “ Australian “ indicates. But I repeat that much more progress could have been made, lust let us reflect on the progress that has been made in Victoria and South Australia. South Australia has progressed from being a claimant State to being not a standard State but one which does not now need special Commonwealth assistance. Let us think of the progress that has been made in Western Australia. Most thinking people are convinced that similar progress could have been made in Tasmania, in spite of its handicaps, if it had had a forward looking government which had not become stagnated through 30 years of office. The Tasmanian Government does not seem to have one fresh idea in its head.

With all due deference to you, Mr. Acting Deputy President, Tasmania offers greater tourist attractions than does any other State in the Commonwealth. It could have been made Australia’s summer mecca for tourists. The tourist industry could have been so developed that it could have attracted an income not of £4$ million, but many times that sum.

Senator Henty:

– We cannot attract tourists by shutting down on Friday afternoon and opening on Monday morning.

Senator LILLICO:

– That is so.

Senator Henty:

– Tourists are attracted by offering service.

Senator LILLICO:

– In Hobart everything is closed for the weekend, and the powers that be want to make every other part of the State the same. Insufficient thought and money are being devoted to developing the tourist industry, the potential of which I believe is unequalled elsewhere in the Commonwealth.

I support the Bill. I repeat that the Grants Commission has done a wonderful job for the claimant States. It seems to me that it is adopting methods which are even more advantageous to the claimant States than those adopted in the past. I repeat also that Tasmania has been well treated not only in respect of the proposed special grant but in respect of every other grant it has received. My only regret is that the money so allocated to Tasmania has not been put to better use.

Senator BRANSON (Western Australia) 19.91. - In rising to speak to this measure I find myself in rather distinguished company. I am following the Leader of the Opposition (Senator McKenna) and Senator Lillico, and I believe that the next Government speaker is to be Senator Wright. I say that I am in distinguished company because I have a healthy respect for the approach of these three men to the very great problem of Commonwealth and State financial relations. I always like to listen to their contributions to debates on this subject.

The Bill is designed to authorise the payment of special grants totalling £15,860,000 to Western Australia and Tasmania, which are the two remaining claimant States. Western Australia will receive £8,560,000 and Tasmania will get £7,300,000. The Bill also authorises the payment of advances to the two States for the earlier months of 1965-66 until this Parliament authorises payment of the special grants for the next year. Most senators probably are quite familiar with the workings of the Commonwealth Grants Commission. Nevertheless, I believe it is appropriate to mention briefly some of the procedures adopted by the Commission. Senator McKenna covered seme of this ground but I believe that several of the subjects he mentioned are worth repeating.

The special grants, recommended for payment each year consist of two parts. One part consists of the advance payments based on the Commission’s assessment of the financial needs of the claimant State for the year in which the grant is to be paid. This part is subject to financial adjustment two years later when the Commission has completed its examination of the audited results of the States’ finances for that year. The second part of the grant consists of the final adjustment of the advance payments made two years earlier. The Bill includes provision for an adjustment of £660,000 for Western Australia, and £491,000 for Tasmania in respect of 1962-63. The Commission arrives at the figures it recommends for payment after a very close and detailed comparison of the budgets of the claimant States - Western Australia and Tasmania - with the budgets of the standard States. I think that New South Wales and Victoria arc used as the standard States. As Senator Lillico said, the Commission pays particular attention to the defferent levels of expenditure and to the efforts made by the States to raise revenue.

The special grants of £15,860,000 authorised by the Bill represent an increase of £4,410,000 on last year’s figure. I draw the Minister’s attention to page 1890 of the “ Hansard “ report of the debate in the House of Representatives, because either the Treasurer (Mr. Harold Holt) was misreported or a typographical error has occurred. The “ Hansard “ report states that the special grants recommended for payment in 1964-65 are £4,140,000 greater than those paid in 1963-64. It seems obvious that an error has occurred in the report, because Senator Henty, representing the Treasurer in the Senate, quoted the correct figure of £4,410,000.

One reason why the States are to receive tin increase in special grants is that the Commission adopted a new method of comparing the levels of expenditure on social services in the claimant and standard States. The result of the adoption of the new method has been favorable to the claimant States. Usually the debate on the States Grants (Special Assistance) Bill is rather academic and the only contributors are representatives of the claimant States. It is interesting to note that since the establishment of the Commonwealth Grants Commission 31 years ago its recommendations have been wholly accepted by governments and no amendment has ever been moved to the relevant legislation. I suppose that the founding fathers of the Commonwealth realised the problems that would confront them in attempting to form six separate sovereign States into one Commonwealth. Time has shown that some of their fears were valid. Thank goodness that 31 years ago some one had the wisdom to establish the Commonwealth Grants Commission. The credit has been given to a former Prime Minister, Mr. Lyons.

Senator Wright:

– Undoubtedly it was J. A. Lyons.

Senator BRANSON:
WESTERN AUSTRALIA

– I am glad to have the confirmation of Senator Wright that Prime Minister Lyons had the wisdom to set up the Commonwealth Grants Commission. It was probably one of the finest things ever done by a Commonwealth Parliament for the States which suffer special disabilities. I pay my tribute to the former Prime Minister for his foresight.

In its deliberations, the Commission takes into account such factors as population, development of secondary industries, average earnings and incomes, cost of development of State resources, and” so on. At page 18 of the thirty-first report of the Commission appears Table 1, which sets out a comparison of the populations of the States as at June 1962 and June 1963. As a Western Australian I was interested to discover that Western Australia showed the highest rate of population growth in that period, followed by Victoria and South Australia. The same position applied in the period between June 1961 and June 1962. The high rate of population growth in Western Australia was evident in the gain both from natural increase and from immigration. The rates applicable to Western Australia are exceeded only by the natural increase .rate in Tasmania, which continues to be the highest in the Commonwealth. The report states -

The high rates of natural increase in the two claimant States of Western Australia and Tasmania are among the causes of the relatively larger number of school children in these States which is reflected in the costs of the provision of education services.

Senator McKenna’s references to school bus services are relevant to that statement in the report. The report also states -

In recent years, Tasmania and Queensland have had very low rates of increase from net migration. From June 1962 to June 1963 there was an actual net loss from migration in Tasmania. This loss illustrates one of Tasmania’s problems which it has faced for many years - the loss of nativeborn citizens who migrate to the mainland for various reasons, one of which is better employment opportunities. 1 shall not attempt to develop the theme on which Senator Lillico ended his speech. Perhaps 1 could leave it to Senator Wright.

The Commission in arriving at its recommendations also considers the development of secondary industries. On page 20 of the report this statement appears - lt will be noted that rural population has declined in all States. Metropolitan population has shown the largest relative increase in Victoria, Queensland and Western Australia. ] think honorable senators are well aware of the times during debates on the adjournment and on other occasions when 1 have urged that we should be doing more to make our rural areas attractive to the people who live in them. I have also spoken on this subject on television programmes. We should have paid greater attention to this problem of the drift of population from the country to the cities. I am quite sure that it occurs only because better facilities are available in the cities. The Commonwealth Government can pride itself on its efforts to make country life more attractive in Western Australia. The Western Australian Comprehensive Water Scheme is one project that comes to mind. We should be doing our utmost to halt the drift to the cities that is clearly illustrated in the tables set out in the report.

Senator Ormonde:

– What about a bit of decentralisation?

Senator BRANSON:

– That is the very subject to which I am referring - methods to stop the population shifting from the country to the cities. I have quoted figures to show that the Western Australian Government is doing everything in its power to assist decentralisation in that State. Anyone who has travelled throughout the State will appreciate that it covers a colossal area. The fact that Western Australian producers are at such a great distance from the markets in the eastern States presents problems which are not easy for the State Government to overcome. The Commission, at page 22 of the report, stated in paragraph 19 -

It may be observed that the increase in average weekly earnings in Western Australia over the period 1958-59 to 1962-63 was 21 per cent, com pared with an average increase in the figures for New South Wales and Victoria of 19 per cent. On the other hand, the corresponding increase for Tasmania was 17 per cent. Western Australia also showed a greater increase in personal income per capita, than in the standard States, over the period 1958-59 to 1962-63: the Western Australian increase was 22 per cent, and the average increase in New South Wales and Victoria was 18 per cent. The Tasmanian increase was only 15 per cent. Again, I point to those factors to show that the State Government is doing all that it can within its capacity to lift itself to a position where its claims will be less. I hope that in the near future Western Australia will arrive at the point where it will no longer be a claimant State. I think that I made a similar comment during a debate on legislation of this kind about two years ago. Tasmania has its problems because it is an island State, but the State of Western Australia-

Senator Prowse:

– Might as well be an island.

Senator BRANSON:

– Yes. Water surrounds Tasmania, and a desert separates Western Australia from the eastern States. When we consider the physical barrier of the desert, looking westward, and also the state of development of the northern area, we appreciate the terrific disabilities that confront any government, regardless of its political colour, which attempts to develop the northern part of Western Australia from its own resources. The task is impossible. An honest endeavour can be made, but it is necessary to come back to Commonwealth assistance in the way of special grants such as have been made for the Ord River scheme. But the Ord River scheme is only an isolated instance. People like Senator Willesee and Senator Cant, who know the north as well as I do and have travelled throughout the area, probably could name six or seven other subjects for development that would be as successful as the Ord River scheme has been. Realising al) the disabilities which confront the State, I think we are doing a remarkably good job, particularly in view of the increase in average weekly earnings and in population, to which I have referred.

In chapter 1, at page 11 of the report, the Commission states that Western Australia and Tasmania asked for £15,913,000 and received £15,860,000, so that they received £53,000 less than they claimed. 1 would not like to attempt to predict when Tasmania and Western Australia will no longer be claimant States. I do not know whether it will then be possible to undertake specific projects such as the Ord River scheme, involving expenditure of £20 million in the initial stages and £30 million in the secondary stages, over a period of about 15 years. Nevertheless, there will still be specific developmental problems.

As a Western Australian I am very pleased that the total amount of the grants is over £4 million more than last year. Naturally, we would like more money, but I think we have to be realistic when we come to the Commonwealth Government for money because, after all, the money can come from only one source, and that is from the people of Australia. I am sure that the amount we have been granted this year will be wisely spent. In the last six years Western Australia probably has gone ahead at a greater rate than at any other time in its history with the exception of the period of the discovery of gold.

The fact that the Budgets of the claimant States must be reviewed each year imposes on the Commission and the people involved a terrific amount of detailed work. When we read the thirty-first report we appreciate the great volume of work which the members of the Commission undertake in order to prepare a report and make a recommendation. The report is open to scrutiny, not only by this Parliament, but by anybody who is interested to read it. Throughout the 31 years of the existence of the Commission, and irrespective of the political party in government in this place, no-one has yet seen fit to move an amendment of recommendations made by the Commission. I wish to join with my colleagues in paying a tribute to the people who serve on the Commonwealth Grants Commission. I support the Bill.

Senator CANT:
Western Australia

– I support the Bill. Like Senator Branson, I come from Western Australia. I notice that the amount claimed by Western Australia was £8,646,000 and that the amount recommended by the Commission is £8,560,000, which means that the Western Australia claim was not satisfied to the extent of £80,000. That, of course, is perfectly reasonable. Tasmania claimed £7,267,000 and the amount recommended is £7,300,000, which means that it will receive £33,000 more than it claimed. That should make the Premier of Tasmania reasonably happy. There are a couple of aspects of this matter that I wish to consider. In paragraph 159, at page 85 of the report, the Commission states -

In arriving at its adjustments for the relative severity of State non-income taxation in 1962-63, the Commission has followed the procedure of recent years. This procedure is to calculate the revenue which would have been raised by each claimant State if it had levied taxes at the average rates and with the average exemptions applied in the standard States of New South Wales and Victoria in respect to the subject-matters of the various taxes actually existing in each claimant Slate. The revenue which would thus have been raised by each claimant State is then compared with the revenue which that State actually raised.

There is a comparison of the. tax rates. In past years some of the claimant States have been adversely affected because their revenue-raising field was not sufficiently exploited.

Then paragraph 160 states -

The Commission’s calculations show that, in 1962-63, if the claimant States had levied taxes at the average rates and with the average exemptions applied in the standard States, Western Australia would have raised £217,000 less and Tasmania £72,000 less than they actually raised.

Because the two States are claimant States and because they are forced to maintain some comparability with the standard States, they have applied taxation at greater rates than were necessary. This, of course, places an added burden on States that are striving for development. To me, this is not a good thing because these are States that have to attract capital. One of the reasons why Sir Thomas Playford was able to attract so much capital to South Australia in past years was that South Australia became known as the low wage State of Australia and industry was prepared to go there. No doubt, if taxes and levies on industries are lower in a particular State, that State will attract industries. But the claimant States, in order to conform with a set standard, are forced to lexy taxes at higher rates than are necessary. Thus, they will not be very successful in attracting industries. For this reason, I think that we should have a look at this matter.

One of the standard States has threatened to impose an income tax in addition to the uniform income tax that is imposed by the Commonwealth Government. It is increasing public charges, such as freights and fares, within the State. Mr. Bolte has said that he must have an extra £5 million, and that is why he proposes to introduce State income taxation. If Victoria increases taxes and other States raise their standards of taxation to keep up with Victoria, that will not be good for the development of the two claimant States. It will not reduce the time for which they will bc claimant States. In paragraph 167 the Commission states -

Adverse adjustments have been made for Western Australia of £200,000 in respect of railways and £50,000 in respect of metropolitan transport.

Of course, Western Australia is a very large State and its population is scattered. The railways have to run over quite a lot of country that does not attract freights or passengers. Passenger traffic has almost gone out of existence in country areas. Because of the long distances over which goods and passengers have to be carried, it is very difficult to make the Western Australian railways pay. It seems to me that the State should be given greater consideration in this regard. Instead of being adversely affected to the extent of £200,000 in respect of railways, perhaps some adjustment could be made. An adverse adjustment of £50,000 has been made in respect of metropolitan transport. This is a public service that must operate. Whilst it is true that greater numbers of people are travelling by their own motor transport, there are people within the community who cannot afford private motor transport. They must use public transport. It is almost impossible to run metropolitan transport at a profit, particularly when one considers the cost of replacement of equipment. I think the States will have to be given more assistance in providing public transport.

Senator Wright:

– Why should not a service be made to pay its way.

Senator CANT:

– If one looks at metropolitan transport, one finds that if charges are increased to make it pay, traffic will be driven away from it. This is the type of problem that the people who operate these transport systems have to face. The honorable senator can drive around in his motor car, but what about the man who has not got a motor car? He must have some sort of transport to enable him to get backwards and forwards to his work, and his family must have some sort of transport in which to travel. If we raise transport charges we will only force him to travel with a friend who has a motor car. If we adopt that attitude, in a short time we will not have a metropolitan transport system at all. In paragraph 168 the Commission states -

In addition, an unfavourable adjustment of £64,000 for Western Australia has been made in respect of the impact on the financial results of State business undertakings of differences in State basic-wage policies . . .

I do not know what the Commission means by that paragraph. The only difference in State basic wage policies that I know of is that in Western Australia there is a discretion in the State Industrial Commission - in 1962-63 it was the State Industrial Court - to apply quarterly adjustments to the .basic wage. The State Government has said that this discretion must remain in the hands of the Commission and it is to be exercised if the Commission thinks it should be. If an arbitration authority determines that it should exercise its discretion in favour of the working people that is not a reason why the State should be penalised to the extent of £64,000.

Senator Wright:

– If Western Australia adopts an artificial basic wage, in relation to Sydney, it cannot expect Sydney to subsidise it.

Senator CANT:

– I do not think it is an artificial basic wage. It is not a wage that has been determined in accordance with the material that is presented to the Commonwealth Conciliation and Arbitration Commission. It is a wage that has to be made up within the State itself. The Industrial Commission determines the wage. Surely, if the Commission determines the wage, it has the responsibility to maintain the value of the wage. That is all that happens in Western Australia. The method of maintaining the value of the wage is to adjust it in accordance with the consumer price index. If there are movements in the consumer price index in excess of ls. in any one quarter, the wage must be adjusted if its value is to be maintained. Because the Commission has seen fit to adjust the wage, the State is penalised to the extent of £64,000. I think that should not happen. These are matters that should be considered.

It is true that the Western Australian Government supported the different method of assessment of social services. The State comes out of it better than it has done in other years. It has favorable adjustments for 1962-63 of £250,000 in respect of social services and of £220,000 in respect of non-income taxation and it has an unfavorable adjustment of £314,000, which gives it an overall favorable adjustment of £156,000. If the State is to progress as it should and if it is to catch up with the development that has taken place over the years in the south-east corner of Australia it will need to have more money. As the Commonwealth Government has almost the sole responsibility for gathering money from the taxpayers of Australia, it should do more for the development and decentralisation of the claimant States so that the time may arrive when they will not be claimant States. With these remarks, I support the measure.

Senator WRIGHT:
Tasmania

.- As I rise to speak tonight I feel the frustration felt by Rupert Brooke when, climbing the stairway with a sense of demand, reaching the throne of heaven and wishing to assert his view upon what was there, he found only vacant halls, moss growing on the stairs and a listless breeze blowing gently moving the curtains on the walls. When we are discussing the fundamental sinew of government in this Federation - the question of adjustment of finance between the entities that constitute the Federation - we have a listless debate, the conduct of which seems to be the prerogative of representatives of what are called, to the amusement of some of the occupants of the Press gallery, the hill-billy States, and of other apprentices there, the mendicant States. I wonder how many of us remind ourselves of the basis upon which the Federation was established from the financial point of view.

We have only to go back to the mainland conception of the original proposal in section 85 of the Constitution that some mainlanders with mildewed eyes described inveterately - and so persistently that it has become almost a truism - as the Braddon blot. After the first 10 years of Federation it gave way to the whim of this Parliament which substituted therfor per capita payments of 30s. to the States. It was thought that such payments should be sufficient for the needs of the State Governments. During the 1920’s, this arrangement led to the necessity for supplementary grants.

I have spoken in this way in order to put into perspective the political genius of the Commonwealth Grants Commission, the thirty-first report of which we are discussing tonight. As my colleague, Senator Lillico, has reminded those few in the Senate who were here to hear him, J. A. Lyons, after the financial adversity that he had suffered as Premier of Tasmania, entered the wider Federal field and became Prime Minister. He said: “ Let us have a continuing commission which, developing a theme based upon principle, will level out the disparities between the States in such a way as to make this Federation financially viable “. And institute that Commission he did. Those mendicant or hill-billy States which have been the beneficiaries of the grants recommended by the Commission and which rejoice in those fantastic tricks that little governments, whether Federal or State, have played under the throne of heaven ever since, ought to recognise that they owe some of their means of subsistence to the institution that J. A. Lyons, the Tasmanian who became the Prime Minister of the Commonwealth, established, after he had seen the matter from the point of view of an outlying State.

It is that sort of Commission which, if it maintains a purpose true to the ideal of making this Federation financially viable, renders a substantial contribution to evening out the disparities between the various States so as to make the economy of Sydney not over-grandiose compared with that of the villagers of Hobart, and even allow to penetrate into the Melbourne soul that degree of condescension and comfort that comes from giving a little prosperity to the province across Bass Strait.

When we establish a Federation which maintains six separate entities, we must recognise that, to have a unity within the Federation, the economy of one unit must be comparable with that of each other unit. J. A. Lyons appointed to that Commission a citizen of the hill-billy State of

Tasmania, Professor L. F. Giblin. As soon as he accepted the position, the University of Melbourne was pleased to adopt him as its Professor of Economics. It was he who framed the formula to which Senator McKenna has paid tribute tonight as one that has been adopted by every Grants Commission since 1936. It appears on page 37 of the current report. It provides that the Commission shall adjust the financial assistance that should be given from the Federal Treasury to even up financial disparities between the States according to Federal capacity to pay, so that each State unit in the Federation will be economically comparable in- strength with the others.

Having mentioned J. A. Lyons and Professor L. F. Giblin as great contributors to this idea, I speak with no sense of mendicancy as a Tasmanian. I speak as an Australian. The mainland States, in yielding ‘bis small modicum of money to Western Australia and Tasmania, show no great generosity. I appreciate the fact that Mr. P. D. Phillips, Q.C., has been appointed Chairman of the Grants Commission. He is forcible in his approach and has a marked impact on any community he enters. At first his appointment caused some disquiet but this report shows him to be not only a Victorian of some prestige but a man with the status of a true Australian. The Commission stated at page 35 of its 31st report -

The Commission is of the opinion that the standards of government services are not in general higher in the claimant States than in the standard States, with some exceptions, e.g., the higher school-leaving ag*e in Tasmania. Furthermore it has arrived at the conclusion that the economy of administration in the claimant States is not less than in the standard States, except in limited spheres such as some areas of public hospital service. If the conviction of the Commission is well founded in these two respects, the conclusion is inescapable that the cost of providing standard services’ is greater in the claimant States principally because the number of units served is relatively greater, as for instance the greater relative number of school children.

As I have said, the Commission under the chairmanship of Mr. Phillips has shown a true Australian outlook. Its desire is to encourage a unity of development throughout Australia. We have seen this institution develop in our own time. At one time there was a danger of its disintegration in a financial sense when Queensland was enter ing the arena as an applicant for assistance. The Commonwealth Government took the situation in hand in 1957 and presented a point of view to the States. Afterwards, Queensland was no longer interested in establishing itself as a claimant State and South Australia was able to secure independence. If this situation had not been achieved so that there were fewer claimant States than standard States, the Commonwealth Grants Commission would have been frustrated. This Government converted the situation so that instead of having four claimant States there were but two.

In this context I speak not only as a Tasmanian but as one who recently visited Western Australia. Anyone visiting that State and seeing the great challenge it presents with its vast areas and great distances, must agree that it deserves some of the fat of Sydney and Melbourne to succour the endeavours to establish prosperity on its frontiers. What of Tasmania, that little pocket handkerchief State with all the disabilities that Senator Lillico and I recognise? lt suffers from the insularity of its geographical position but it has aspects which I understand will be developed in tomorrow’s edition of the “ Australian “. Judging from a note that I saw today, I think that the “ Australian “ may be going to adopt a truly Australian outlook in focussing its attention on that lovely little island of great potential called Tasmania. Some of the less fortunate people north of Bass Strait do not realise the happiness of the people of Tasmania. It loses population to Sydney and Melbourne with their big payrolls. It suffers the burden of a greater poultice from the waterside workers menage than the mainland ports. It may be said that Senator Lillico and I come from the hill-billy State. That is why Tasmania is to be voted £7.3 million unconditionally to bring it into line with the Australian economy. This will enable our unit of the Commonwealth to function in a manner comparable to the standards of the mainland States.

Now we come to the kernel of the nut. We are voting £7,300,000, which will be expended at the discretion of the freely elected Government of the State of Tasmania. We must bear in mind the responsibility that we have to those who elected us. When the States in 1957 decided definitely to make themselves dependent upon financial votes from this source, in a corresponding measure they renounced their right to enunciate policies that denned the expenditure. Not only that; this touches a much more fundamental concept. The United States of America comprises 50 States whose contesting interests in themselves provide some counterbalance to irresponsibility in State expenditure and in raising State revenue, but in this Federation, constituted of only six States, we have to ponder deeply on the effect of dependence by the State Governments to an increasing degree on reimbursements of uniform taxation, and, in my own State, on the effect of supplementary supra dependence on special financial grants. We have to ponder deeply on the degree to which a government that is a recipient of that finance forfeits the right to claim that it has been elected by its people, with the authority to expend that finance according to its judgment.

This undermines the whole democratic concept of responsible government. la my view of democracy, a government exists to answer for its authority, exercised for or against its people during its term of office, and the people recognise that in the fact that the Government asks them to pay to implement its policies. In a State such as Tasmania, where the Government raises only 30 per cent, or 35 per cent, of its revenue by its own exertion-

Senator Sir William Spooner:

– Not that much.

Senator WRIGHT:

– I always err on the side of understating my argument. I am grateful to my friend. I believe we all must recognise that under this system State Governments depend on financial assistance from, the Commonwealth Government. Therefore, if we reach the situation in the near future that we who are responsible to the taxpayers for the taxes that we require to be yielded to the Commonwealth Treasury demand an increasing share in the definition of Tasmanian policy or the policy of any other State, accompanied by financial grants to the States generally and to universities, the State Governments will have to answer for that. I maintain that in a democratic community we will never keep a balance between the electors and the elected unless there is a reciprocity of obligation. Unless a government that seeks to define policy also has the responsibility of raising revenue, it is apt to forfeit its right to define policy.

I rose in my place in this Senate tonight because I believe the time has come for some deep thinking on this question. I have in mind the recent announcement by the Premier of Victoria that he will introduce a supplementary income tax. In 1957 he joined in a compact that the income tax field would be the prerogative of this Parliament. When we increased the reimbursements to the States from £120 million to £143 million, in suitable proportions, there was a compact by which the reimbursements were to be accepted. As I well remember, the compact went to the extent that the States accepted the continuance of payroll tax on their employee enrolment in State business undertakings. When we have that situation in Victoria, a standard State, and. the ever so much more exaggerated situation in Tasmania, a claimant State, we must recognise that there no longer exist within the State field what can be called sovereign Parliaments. There are Parliaments that must have some regard for the policies pursued by the Treasury out of which the payments are yielded. We can only answer to our electors if we pay these moneys to the States according to policies that they approved when they elected us. If I could put that in a nutshell I would say. “Take heed, Mr. Reece”. To put a final point upon it, let me say that I have spoken here recently in a national sense on the subject of Australian civil aviation. What province has any State in relation to Australian civil aviation when the unity of federation in national activities has to be recognised? The States have no more right to a say in civil aviation than they have to a say in nuclear energy or television and wireless transmission. Heart and soul I am a Tasmanian, but we must regard all these things that defy State boundaries from the point of view of the greatest benefit to Australia as a whole. It is in that spirit, not in the spirit of mendicancy, that this vote is approved here tonight.

Senator COOKE:
Western Australia

– It is rather refreshing to hear a discourse from Senator Wright on the position of the States in this Federation. He is quickly, and quite probably intelligently, coming to the conclusion, reached long ago by the Australian Labour Party, that Australia is a nation and that federalism ls the fundamental base on which our nation will become great. The honorable senator’s argument followed that line right through his speech. Nevertheless, whilst agreeing with him on that point, I think he has taken the debate out of the relevant field. We have before us a measure that is dependent upon section 96 of the Constitution which empowers this Parliament to disburse moneys to the States. The section reads - - During the period of ten years after the establishment of the Commonwealth and thereafter until the Parliament otherwise provides, the Parliament may grant financial assistance to any State on such terms and conditions as the Parliament thinks fit.

That was, of course, in addition to certain obligations that the Commonwealth had in relation to the States on other financial matters. We are here as senators to protect the much talked of sovereign rights of the States. But those powers were passed over by the States, in a large degree, when the right to impose income tax was handed over to the Commonwealth.

Senator Hannan:

– The States did not hand it over. The power was taken from them.

Senator Wright:

– The States acquiesced later.

Senator COOKE:

– The States acquiesced to a degree in respect of the handling of taxation.

Now I come to the report of the Commonwealth Grants Commission which we are discussing here. In view of the basis on which the Commission may work, no honorable senator could quarrel with the recommendations it has made. But I think that this Parliament should have a close look in the near future at what the Commission is charged to do in relation to the Commonwealth’s responsibility for the development of States and the responsibilities which the States have to carry at the present time. Therefore, whilst not disagreeing in any way with the work the Commission has done and, indeed, commending its members for the volume of work they have carried out, I really think that the Commission should be given wider scope in respect of its responsibilities to the claimant

States and also in relation to establishing the standard of advancement of Australia. At the present time the non-claimant States set the standard. That standard, when assessed by the Grants Commission, is the maximum that can be enjoyed by claimant States, irrespective of the fact that it may not necessarily be the best standard that could be applicable in Australia. The grants to the claimant States are based upon the assessment of certain sections of the economy, the policies of the State Governments, social services, our attitude towards development, our treatment of firms in regard to taxation, and our rates and charges. So, we are, to a degree, put in a strait jacket by this Government through the medium of the Grants Commission. The maximum level which can be attained by a claimant State is equivalent to the average advancement or standard of the non-claimant States.

Therefore, while agreeing with the Bill, I say to the Senate that consideration has to be given to those services for which the State Governments are responsible to their people. When Senator Wright spoke of “ our electors “ he was referring to the Australian citizens who elect-the members of the State Parliaments and the Commonwealth Parliament. In each case the electors are the same people. Nor is there any difference between the purposes for which the Parliaments of Australia are elected. I say, therefore, that there is a very urgent need for a re-assessment of the Commonwealth Government’s responsibility to the States and to their development. A flat average standard which has to be accepted should not be adopted just because it is the best that one non-claimant State can achieve. The Commonwealth Government should not be in the position to say: “ We will raise money by way of taxation, lend it to the States and charge them interest on it “. The money has been provided by the Australian citizens who elect to Commonwealth and State Parliaments. The Commonwealth Government should not be able to say to the States: “You will have to cut back your programme of development or accept loans from us to enable you to obtain a fair average quality standard of advancement “. As Senator Wright says, we should ponder on these matters. But I do not think that the Federal Government has the right to display the arrogance it has in respect of

State rights and handle the States in an uppish and domineering way. This Government, which is charged to carry out certain responsibilities, raises large revenues in various ways and, without any inhibitions or restrictions on expenditure, can spend this money unwisely or without obtaining the full advantage from it for Australia. At the same time the Government can audit the budgets of States which have direct responsibilities to the same electors as the Commonwealth Government has.

I am rather happy to see that some consideration has been given to the costs of hospitalisation. This is not a new problem for the State Governments. In the Senate over the last decade, appeals have been made in respect of this service in regard to States such as Western Australia. In that State, hospital facilities have to be provided in remote areas for small populations. The running costs of such hospitals are high. The Commonwealth Government’s assistance to the States for this purpose, either through its health scheme or its grants, has been thoroughly inadequate. As a matter of fact, this assistance has embarassed the States more than it has aided them. In Western Australia, for example, many of the people who work in the outback areas do not belong to any medical or hospital fund, and therefore hospitals which treat such patients may recover only a part of the cost. This adds to the cost of running a hospital. Absolutely fantastic costs per bed are reported by some outback hospitals and, for that matter, even in city hospitals. I am glad that the Grants Commission is considering this matter, although it does need consideration on a much higher plane.

As I have said, the Opposition approves of this Bill and certainly offers no criticism of the Grants Commission, which, within its terms of reference, does an excellent job. However, we say that it is very necessary for the Commonwealth Government to consider with greater reasonableness the rights of the States to share in the bountiful revenues which the Commonwealth collects. From these revenues, Commonwealth services are maintained and seem to be uninhibited. In relation to the States the Commonwealth is cheese-paring and gives them small amounts to provide services for which they are responsible to the Australian people who elect not only the Stale Parlia ments but also this Federal Parliament. I think it is arrogant for the Government or any honorable senator to say that this Parliament will dictate the policies of State Parliaments by financial restriction or by putting a boa constrictor’s hold on a State Government and saying: “ Your policy might be approved of by your citizens, but we will put a financial hold on you to ensure that it cannot be carried out; or we will place you at a disadvantage in an economic sense by restricting the flow of money you need to carry out your responsibilities to your electors “. This is a very wrong approach.

Whilst commending the Grants Commission for the work it has done - and I think it could not have come to a better conclusion in view of the scope within which it is permitted to work - I think the fundamental principle in respect of the Commonwealth Government’s attitude towards the responsibilities of State Governments should be examined and changed. Although the Commonwealth is the collector of the main revenues of the nation, its attitude towards the States needs examination. Reference has been made to the disbursement of the collections of customs duty. There must be a very keen analysis of the financial set-up in the Commonwealth if Australia is to obtain the best advantage from her prosperity. We cannot afford to have the financial administration of the States restricted by the Commonwealth’s saying that the maximum standard to be adopted shall be that of the non-claimant States.

Senator HENTY:
Minister for Civil Aviation · Tasmania · LP

– in reply - It was interesting to note that most of those who have spoken in this debate are Tasmanians or Western Australians. It is right that that should be so, because the recommendations of the Commonwealth Grants Commission will result in Tasmania and Western Australia receiving large increases in the special grants for this year. I am sorry that I cannot agree with the suggestion that was advanced by Senator Cooke. I am completely opposed to any suggestion that we should alter the Commission’s basis of approach to the financial problems of the States. Over the years the Commission has become expert in its analysis of the economies of the States. It has a duty to ensure that the economies of Western Australia and Tasmania are not below those -of the two major States. A very keen and long analysis is necessary to enable the Commission to arrive at its conclusions.

Senator Cooke:

– The Commission does an admirable job, but is that the best that the Commonwealth can do?

Senator HENTY:

– The Commission does an admirable job. It has had long experience in this task. To give the Grants Commission any other responsibility would weaken its position. An increase of approximately £2,500,000 in the grant that is to be given to Tasmania perhaps should lead us to give some thought to the position in which both Tasmania and Western Australia find themselves at the present time. I think of Western Australia as being like a giant on the march. Western Australians are fine, vigorous, forward-looking people who have a great belief in the tremendous potential of their States and who have the will to move forward and plan for its development. I repeat that Western Australia seems to me to be like a giant on the march. That State is developing rapidly, with, of course, substantial assistance from the Commonwealth Government. I am not suggesting that Western Australia does not deserve that assistance. No Commonwealth Government would give grants to States which did not deserve them. Western Australia is moving forward with projects that have commanded the support of the Commonwealth Government.

When I think of my own State of Tasmania, I must agree with those who have voiced the opinion that the money that has been made available to it by the Commonwealth Government has assisted the State’s economy. However, the economy of Tasmania has not yet advanced to the stage where the people of that State are able to enjoy the advantages that are enjoyed in other parts of Australia. I know there are certain reasons for that state of affairs. For a time there was in office in Tasmania a vigorous government which stemmed the drift of the State’s young people to other places. Not many years apo Tasmania was attracting industry, which in turn was employing the State’s young people. But for some time there has been a drift of our young people to the mainland of Australia and overseas. I do not agree with the suggestion that those young people have moved elsewhere only for money. They have been attracted by the excitement that is, to be found in the bigger cities and by travelling to the Old Country and Europe. It is not without a feeling of pride that one finds many Tasmanians occupying big positions in the mainland States. Senator Wright referred to civil aviation. That leads me to recall that at one time three Tasmanians headed the great aviation industry of Australia. Sir Warren McDonald, who was the Chairman of the Australian National Airlines Commission, Sir Ivan Holyman, who was the head of Australian National Airways Pty. Ltd., and Sir Hudson Fysh, the Chairman of Directors of Qantas Empire Airways Ltd., all came from Tasmania and from the same school. Although Tasmania is a small State, it has played a prominent part in the development of Australia.

There is genuine disquiet amongst the people of Tasmania at the present time at the fact that more vigorous policies are not being pursued In that State to help it to develop at a greater rate. Reference has been made to the tourist industry. I had the great pleasure of assisting a very well known and responsible American who is the head of the International Air Transport Association to see Tasmania. He told me at first that he was sorry he would “not be able to see our State. He said he believed that it provided the best package deal for tourists in the world. I was able to provide him with facilities to go down there. He later wrote to me saying that he found Tasmania to be more delightful than he had believed.

A vigorous policy to attract tourists to Tasmania would assist the State tremendously. Youth hostels and additional camping areas should be established. I have spoken to many young Tasmanians who have travelled through Europe and the United Kingdom. They have told me that the availability of youth hostels enabled them to make their trips much more cheaply. The provision of camping areas throughout Europe induces people to make extensive tours throughout that continent. Such facilities should be developed in Tasmania. There is need for much more self help in developing that State. Industrially Tasmania is at some disadvantage, as has already been stated, because of the strip of water which lies between that State and the northern island. It means that we are at the mercy of the very high costs of the carriage of goods by sea. I have been in business and can remember when the cost of freight between Melbourne and Launceston was 18s. a ton. Today it is about £6 7s. 6d. a ton. Freight charges are one of the handicaps of Tasmanian businessmen. There was a time when Tasmania’s cheap electricity countered high freight charges, but that time has gone. Such problems can be overcome by a vigorous spirit of self help, which is needed in Tasmania if we are to develop at a rate which can favorably be compared with the development rates of other States.

I have mentioned some of these matters because I agree entirely with the very intelligent comments made by Senator Wright. It is not possible for a State to continue to accept financial assistance from the Commonwealth Government and let that assistance play such a tremendous part in State revenues without the growth of a tendency to lose command of State sovereignty. These things are fundamental and should be looked at pretty carefully by Tasmanians.

I was interested to hear Senator Wright’s comments on civil aviation. They were welcome to my ears, because they come at a time when the Government - and may I include the Opposition - might well have second thoughts about the position of civil aviation in Tasmania. In my journeys around Tasmania I see aerodromes at St. Helens, Queenstown, Strahan, Zeehan and such places at which I thought it would be impossible to develop them. I see the great airports at Hobart and Launceston. I see the part that the Commonwealth has played in developing airports at Devonport, Burnie, Wynyard, King Island, Flinders Island and the outback areas of Tasmania. Surely the Tasmanian Parliament can be big enough to realise that there is no divisi bility in the sphere of civil aviation, where it is suggested that the Commonwealth Government should control international and interstate avaiation, but should not control intrastate aviation. Perhaps I have entered a field where I am trespassing.

Senator Wright:

– Do not say that I tempted the honorable senator.

Senator HENTY:

– I was rather tempted away from the subject that I rose to discuss by the comments of Senator Wright on a subject which is very dear to my heart. May I say only that the development of civil aviation in Tasmania has been tremendous and that 99 per cent, of it is due to the efforts of the Commonwealth. The initial impetus was given by the three Tasmanians to whom I have referred, who headed the great aviation industry in Australia in days gone by. I thank the Senate for its acceptance of the Bill.

Question resolved in the affirmative.

Bill read a second time.

In Committee

The Bill

Senator WRIGHT:
Tasmania

.- It is perhaps only in an institution such as the Senate that we could find that the Leader of the Government (Senator Paltridge) represents Western Australia, Senator Henty, who introduced this Bill and is the Minister representing the Treasurer, comes from Tasmania and the Leader of the Opposition (Senator McKenna) also comes from Tasmania.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

Bill (on motion by Senator Henty) read a third time.

Senate adjourned at 10.37 p.m.

Cite as: Australia, Senate, Debates, 9 November 1964, viewed 22 October 2017, <http://historichansard.net/senate/1964/19641109_senate_25_s27/>.

View PDF View XML View in Voyant