21 April 1966

25th Parliament · 1st Session

The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 11 a.m., and read prayers.

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Senator McMANUS:

– Does the Minister representing the Prime Minister agree that there are serious implications for Australia’s future in the startling drop in our birthrate which has just been announced? Should we fail to populate this country, would not our right to hold the almost empty northern areas in particular be open to challenge? Will the Government seriously consider remedying this position, particularly by granting family assistance?

Senator HENTY:
Minister for Supply · TASMANIA · LP

– The present birthrate must be of concern to every Australian. There is no doubt that Australia needs additional population urgently. Of course, the best form of increase is natural increase. As to the second part of the question, this is a matter for budgetary consideration. The next Budget will be considered prior to the next sessional period. There is no doubt that this matter will be before the Cabinet at that stage.

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Senator BISHOP:

– 1 ask the Minister representing the Minister for Civil Aviation whether the establishment of a committee to investigate flight schedules, which was announced yesterday by the Minister for Civil Aviation, will mean that plans for increased passenger accommodation at the Adelaide airport terminal will be delayed or shelved. Is it not a fact that information which is available to the Department of Civil Aviation demonstrates that, even under the most favorable flight schedules, this accommodation will be inadequate? Will the Minister examine ways to provide immediately increased space and/ or seating accommodation at the Adelaide airport?

Minister for Customs and Excise · NEW SOUTH WALES · LP

– 1 shall refer the question to the Minister for Civil Aviation.

I do not think it is proper to assume that because a special committee has been set up to consider aspects of programming, further development will be hindered. On the contrary, I should have thought that the establishment of such a committee would be in the best interests of all concerned. However, as I said, 1 shall refer to my colleague the specific question asked by the honorable senator.

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Senator COHEN:

– My question is addressed to the Minister in Charge of Commonwealth Activities in Education and Research. Did the Minister, at the opening of the Commonwealth Scientific and Industrial Research Organisation’s David Rivett Laboratories in Melbourne this month, say that Australia may need a national science foundation to handle research funds? Did he further suggest the possibility of reshaping the organisation of the C.S.I.R.O.? Have such thoughts been prompted by the forward looking and comprehensive science policy that was adopted by the Australian Labour Party last year? Is the Minister in a position to make a statement to the Parliament on these and any other future significant changes in science policy?

Senator GORTON:
Minister for Works · VICTORIA · LP

– In opening the David Rivett Laboratories at or close to Monash University, I took the opportunity to raise a number of questions which those persons interested in the future of scientific development in Australia would no doubt wish to consider and to discuss. I gave no answers to any of those questions because it is easier to raise them than to answer them.

Senator Sandford:

– That is not unusual.

Senator GORTON:

– lt is unusual if one has come to a firm decision, but it seems reasonable if one is suggesting that those who are interested in the development of science might turn their minds to a number of arguments this or that way and to various questions which obviously will arise. One of these would be the matter that the Govenment itself, under the previous Prime Minister, suggested to this House as a matter for proper consideration. I refer to the establishment of some form of overall advisory committee for the allocation of resources to science. That is not a simple matter. I know of no country which has worked out to its own satisfaction a method by which it can bc done. It is a matter for proper consideration and one which I suggested that the scientists might wish to discuss. Other related matters I suggested were possible alterations in organisation. I think the particular matter I used as an illustration was that of astronomy. It is quite possible that such steps could be taken in connection with radio astronomy installations and optical astronomy installations.

None of the suggestions was instigated by what Senator Cohen has chosen to call the “ forward looking policy “ of the Australian Labour Party. What I remember mostly of that policy is that it suggested the setting up of a research grants organisation to make grants to research institutions and universities. When Labour made that suggestion, action had already been taken in that respect by this Government.

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– I direct my question to the Minister representing the Minister for Customs and Excise. Has the Minister noticed reports of the concern expressed in Great Britain at the proposal of an American company to introduce into Britain spying devices for over-the-counter sales, embracing 75 types ranging from eavesdropping gadgets to telephone tapping equipment? Since the United States Government itself has tightened up control on the sale of such devices, will the Minister ensure that such devices are deemed prohibited imports?


– As the honorable senator addressed his question to the Minister representing the Minister for Customs and Excise, I invite him to have a good look at me. I am the Minister for Customs and Excise. As to the honorable senator’s question relating to prohibited imports, I would like to have a good look at it. I do not think that I would be prepared to say that I would invoke a prohibition on the basis of a Press report of what has happened in another country. Frankly, I am not very impressed with the proposition, but in fairness to the honorable senator I will consider his question.

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Senator GAIR:

– I direct my question to the Minister representing the Prime Minister. When may I expect a reply to Question No. 788, which stands in my name and notice of which was given on 10th December last year?

Senator HENTY:

– At the earliest possible moment that I can secure it. I will see what I can do.

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– My question is addressed to the Leader of the Government. On 11th November last I asked the Minister whether he would confer with the Minister for the Army and arrange that there should be no publication of Army casualties in Vietnam or other areas in which Australian troops are engaged until such time as the appropriate Service had advised relatives and was in a position to release names. The Minister said that he would let me know whether this could be done. I have noticed in the Press over past months that this practice is now being followed. Will the Government continue to follow it?

Senator HENTY:

– I referred the honorable senator’s question to the Minister for the Army on the previous occasion. I will refer this one to the Minister to see whether he has adopted the policy mentioned.

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Senator COHEN:

– My question is directed to the Leader of the Government. On 16th March I asked him whether he could confirm that the Saigon Government had reported that there had been 113,000 desertions from the Army of South Vietnam in 1965 and whether the Australian Government was aware of this fact before it decided to treble our commitment in that country. On 22nd March the Minister told me that the Department of External Affairs had been unable to verify that the Saigon Government had made such a statement but that he would seek the information. I ask him now whether he is in possession of that information.

Senator HENTY:

– I have some notes on this matter. The Government has no knowledge of a report from Saigon concerning desertions from the armed forces of South Vietnam to the effect mentioned by Senator Cohen. Whilst desertions from the armed forces of South Vietnam in 1965 do appear to have been substantial, there are some special problems which need to be taken into account. There is no category of “ absent without leave “ in the South Vietnamese forces and many desertions are, in fact, temporary absences by Vietnamese who, for traditional reasons, return to their homes at certain times of the year for harvests and festivals. Many of the deserters would in fact rejoin the forces after a temporary absence. There are no figures which record such returns to service. The majority of desertions have been from the popular and regional forces and not from the regular armed services of South Vietnam.

Whatever may be the facts about desertions, the strength of the South Vietnamese armed forces is continuing to grow. There was an increase of 60,000 in the armed forces in 1965 representing a rise of -some 1 1 per cent, in the total strength. The number in the armed services represents a high proportion of the total population. There were over 570,000 people in the South Vietnamese armed forces at the end of 1965. It is clear that the vast majority of deserters do not go over to the Vietcong.

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Senator KEEFFE:

– I preface my question to I he Minister representing the Minister for Territories by stating that the cacao project established on the Gazelle Peninsula in New Britain in 1951, and which is now operating 16 fermenteries proved to be so successful that European and Asian traders are now trying to wreck it. Will the Minister initiate immediately legislation which will convert the Tolai cacao project into a co-operative bod) controlled by indigenous growers, and at the same time request all local growers to arrange for the treatment of the whole of their cocoa crop through such co-operative? Will the Minister ensure that adequate loan moneys at reasonable rates of interest are made available for financing such an enterprise through a Territory development bank?

Senator GORTON:

– Without accepting any of the assertions contained in the question, I suggest that it be put on the notice paper so that the Minister for Territories can supply an answer.

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– I address my question to the Minister representing the Minister for Health and preface it by stating that in several States and Territories much excellent medical research has been carried out into the ailments of retarded children but that there is one field in which nothing has been done, namely, the field of autistic or withdrawn children. This growing problem has been brought to my notice by interested parents. I ask the Minister: Has the Department of Health made any investigations into this child problem? Will the Minister arrange for this matter to be placed on the agenda for the next meeting of the National Health and Medical Research Council? If the Government has any information on this unpublicised problem will it make that information available to the Senate?


– I am very interested in the subject that has been raised by the honorable senator because I know something of the work that is being done on it by committees. I shall be pleased to take up with the Minister for Health the points that the honorable senator has raised.

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Senator RIDLEY:

– I direct a question to the Minister representing the PostmasterGeneral. Will the Minister request the Postmaster-General to give favourable consideration to having the numbers of all telephone subscribers included in telephone directories covering the respective States even if the subscribers are attached to a line or exchange in another State?


– I will refer the honorable senator’s request to the Postmaster-General.

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Senator COHEN:

– I direct to the Leader of the Government in the Senate a question supplementary to the question on which he gave an answer earlier. The Minister stated that the Government had no knowledge of the reported statement by the Saigon Government in relation to figures on desertions from the South Vietnamese forces. I remind the Minister that my question was based upon a report from Saigon in the “ New York Times “ of 24th February 1966. I ask the Minister specifically whether, before giving an answer to my question, the Government made any inquiries on this subject from the Government of South Vietnam.

Senator HENTY:

– I am not in possession of the information the honorable senator seeks. I took up his previous question at the time he asked it and the reply I have given him contains the facts of the case. The honorable senator evidently seeks further information and if I can obtain it, I will certainly do so. I suggest that he put his supplementary question on the notice paper.

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Senator McMANUS:

– I direct a question to the Minister representing the Treasurer. Is the Government aware that there is a feeling of profound discontent at the overriding influence of the Elizabethan Theatre Trust on assistance offered by the Government for the promotion of the arts and culture, and that this discontent has been expressed by representatives of the Australian Broadcasting Commission, by Mr. Colin Badger, Director of the Victorian Adult Education Association, and by the recent conference of repertory theatres in Adelaide? Will the Government give urgent consideration to allaying this discontent by setting up a council for the arts to ensure justice to all phases of the arts?

Senator HENTY:

– This question involves a matter of policy, and a matter of policy cannot be dealt with in a reply to a question without notice. I shall refer the matter to the Treasurer for his consideration. This is not the only type of foundation which seeks additional funds.

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(Question No. 705.)

through Senator O’Byrne

asked the Minister representing the Minister for Civil Aviation, upon notice -

  1. When were air route charges for the purpose of improving navigational aids and aerodrome facilities first imposed?
  2. Are these charges made to recompense the Commonwealth Government, wholly or in part, for capital expenditure or maintenance and operational expenditure, or both?
  3. What is the method of calculating these charges?
  4. What amounts have been paid by each of the airline companies in each year since the charges were first imposed?
  5. If, in any year, there was a reduction in any of the charges, what was the reason for such reduction?

– The Minister for Civil Aviation has supplied the following answer -

  1. Air navigation charges were first imposed by the Commonwealth with effect from August 1947, for the purpose of recovering part of its annual expenditure on maintaining and operating air navigation and aerodrome facilities.
  2. The charges are designed to recover, in the long run, the costs of maintaining and operating the air navigation facilities properly attributable to the air transport industry. Such costs include appropriate allowances for depreciation and interest on the funds expended in providing the facilities.
  3. The method of calculating air navigation charges is set out in the Air Navigation (Charges) Act 1952-1965. Broadly, the charges for airline operations are based on the usage of facilities on the regular airline routes, which are rated for the purpose of the Act, and for the maximum weight of the aircraft concerned. For other types of operation, an annual charge is payable for each aircraft based on the maximum weight of the aircraft and the class of operation. 4 The amounts are shown in the attached table.
  4. In 1952 the Commonwealth agreed to reduce by two thirds the charges paid or payable by Trans-Australia Airlines, Australian National Airways Fry. Ltd., and all other operators, from the date of inception of the charges until 30th June, 1952. From 1st July, 1952, the original scale of charges was reduced by one half. These reductions were negotiated with the airlines following doubts cast on the validity of the charges which, prior to 1952, had been imposed by regulation, and because it was accepted that the original level of charges was too high in the light of the existing economic state of the industry.

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(Question No. 710.)

Senator WHEELDON (through Senator

O’Byrne) asked the Minister representing the Minister for Defence, upon notice -

What is the nature of the lectures on political matters given to national service trainees and other recruits to the services and by whom are the lectures given?

Senator GORTON:

– The Minister for Defence has now supplied the following answer -

The Services give some broad elementary instruction on political matters and current affairs covering the principles of democracy, the basis of the governmental system in Australia and political and military developments in the countries of South East Asia, The instruction takes the form of lectures or discussion or both and is given by education officers, chaplains or other appropriate officers.

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(Question No. 790.)


asked the Minister representing the Minister for Shipping and Transport, upon notice -

  1. Has the Minister studied the Ribicoff report of the United States Senate Road Safety Committee which made a detailed investigation of automobile designs and their relationship to road safety?
  2. Since this report made some reference to road stability defects in Corvair cars produced from 1960 to 1963, will the Minister ascertain the percentage of such models that have been involved in road accidents in Australia?
  3. In the light of the observation in this report that a higher preference is given in United States cars to style over safety, will the Minister consider the possibility of banning the import of cars which may constitute road hazards?

– The Minister for Shipping and Transport has supplied the following answer -

  1. The United States Senate has a sub-committee under the chairmanship of Senator Abraham Ribicoff investigating the federal role in traffic safety. This sub-committee commenced hearings in March, 1965, and they are still continuing. As far as it can be ascertained, the sub-committee has issued no report. The only document available in Australia is the verbatim transcript of the hearings and evidence tendered for the first three days of the hearings. It is understood a further volume of the verbatim proceedings and evidence presented has been published but it is not available yet in Australia.
  2. Approximately 30 Corvair cars manufactured between 1960 and 1963 have been imported into Australia. Because of the rarity of these vehicles in Australia, statistics are not available of the exact number imported and similarly, no statistics are available in respect of the incidence of the involvement of Corvair cars in road accidents.
  3. The report of the sub-committee, when available, no doubt will be examined by the Australian authorities concerned with road safety. The Australian Transport Advisory Council at its meeting in July, 1965, established the Australian Motor Vehicle Design Advisory Panel to investigate and report on the design of motor vehicles with the object of reducing the incidence of road accidents and fatalities and minimising the extent and severity of injury to road accident victims. The reports of this Panel will be brought to the attention of the Commonwealth and State Governments through the Australian Transport Advisory Council.

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(Question No. 199.)

Senator BISHOP:

asked the Minister representing the Minister for Civil Aviation, upon notice -

Is it a fact that a proposed Trans-Australia Airlines flight from Adelaide to Sydney via Canberra, listed to continue during the sessions of the Federal Parliament, was prevented from operating? If so, did the Minister or his Department take this action?


– The Minister for Civil Aviation has supplied the following answer -

Presumably the flight referred to was the Tuesday morning Viscount service from Adelaide to Sydney which operated via Canberra for Parliamentary travel. Trans-Australia Airlines decided to suspend this service shortly after the introduction of the Boeing 727 aircraft on the Adelaide-Sydney route. Trans-Australia Airlines hopes that the traffic position will justify the restoration of its Tuesday flight later in the year but to date, owing to the popularity of the jet services, there is only a light demand for Viscount services.

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(Question No. 796.)


asked the Minister representing the Minister for the Interior, upon notice -

  1. Did the Shoalhaven Shire Council recently decide to seek an investigation by both State and Federal authorities of a “ how to vote “ pamphlet issued on behalf of the Shoalhaven Shire Progress and Development Committee?
  2. Has the Electoral Officer for the Division of Macarthur been consulted?
  3. Has the complaint been referred to the Commonwealth Police?
Senator McKELLAR:
Minister for Repatriation · NEW SOUTH WALES · CP

– The Minister for the interior has supplied the following answer -

  1. I am unaware of any decision taken by the Shoalhaven Shire Council in this matter.
  2. No.
  3. No.

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(Question No. 804.)

Senator SIM:

asked the Minister repre senting the Minister for Civil Aviation, upon notice -

  1. Is it a fact that five leading United States airlines are advertising in Australia for pilots?
  2. Is it also a fact that Australian airlines are facing a serious shortage of pilots?
  3. How many pilots from (a) Qantas. (b) TransAustralia Airlines and (c) Ansett-A.N.A. have applied or left for positions with United States airlines?
  4. What is considered to be the reason for the interest of Australian pilots in the United States offers?

– The Minister for Civil Aviation has supplied the following answers -

  1. Neither my Department nor the airline companies have any knowledge of leading airline operators in the United States advertising in Australia for pilots.
  2. There is a shortage of pilots in Qantas but not in the domestic airlines.
  3. No Australian pilots from Qantas, TransAustralia Airlines or Ansett-A.N.A. have taken up positions with airline operators in the United States. I have no knowledge of any applications having been made for positions with U.S. airlines.
  4. Not applicable.

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(Question No. 843.)

Senator GAIR:

asked the Minister representing the Minister for Immigration, upon notice -

Is it a fact that the West Indian, Wesley Hall, has been given permission to come to Australia to play cricket and that permission has been refused to a Hong Kong Chinese, named Wong, to come here to play soccer? If so, why has there been different treatment of these two people?


– The Minister for Immigration has supplied the following answer -

The entry of Mr. Wesley Hall for cricketing engagements was authorised under normal rules permitting visits of outstanding performers in sport, theatrical artists, etc. One of the normal conditions of entry is that the person concerned will not accept employment outside the field of the engagements for which the visit is authorised.

Mr. Wong Kong Leong, known as Johnny Wong who having been admitted to Australia in 1958 as a student, was required to leave Australia in January last because of his failure to observe the conditions of his entry over a long period. Careful consideration was given to an application by a soccer club for Mr. Wong’s re-entry as a player. The conclusion was reached that -

it could not be accepted that Mr. Wong wished to come to Australia for the soccer season only, as he had raised the question of his being permitted to engage again in a course of study; on his past record he could not be regarded as a genuine student;

the terms offered to Mr. Wong, for playing in one match each week, were not such as to ensure that he would refrain from seeking other employment, as he had done when here as a student:

the application was not therefore one for approval under normal rules.

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(Question No. 805.)

Senator GAIR:

asked the Minister repre senting the Minister for Defence, upon notice -

What has been the result of investigations carried out into the sightings of foreign submarines in New Guinea waters in September 1965, and in waters off the south coast of New South Wales during February of this year?

Senator GORTON:

– The Minister for Defence has supplied the following information -

Of the five reported sightings of submarines off the New Guinea coast in 1965, two were found to be those of a United States submarine, two were non-submarine, and one was assessed as “ insufficient evidence “. There was no sighting of a submarine in February, but indications were picked up by ships of the Royal Australian Navy during exercises some 100 miles off the south coast of New South Wales that an unknown submarine may have been in the vicinity. The area was thoroughly searched by Her Majesty’s Australian ships and aircraft and maritime patrol aircraft of the Royal Australian Air Force, but no firm indications of a submarine were found.

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(Question No. 807.)

Senat or KEEFFE asked the Minister representing the Prime Minister, upon notice -

Why was the Australian Government not represented by the Deputy Prime Minister or a senior Cabinet Minister at the funeral of the late Prime Minister Shastri of India?

As this lapse could cause serious repercussions and possibly serious offence to our non-white Asian neighbours, has the Australian Government since apologized to the Indian Government for apparent discourtesy by its failure to have, at the very least, a Cabinet Minister in attendance at the funeral?

Senator HENTY:

– The Prime Minister has supplied the following answer to the honorable senator’s question - 1 and 2. The late Prime Minister of India, Mr. Lal Bahadur Shastri died late at night on 10th January 1966 and advice of his death reached the Department of External Affairs during the morming of 11th January 1966. The Department was informed later that day that the funeral would take place at 10.30 a.m. in New Delhi on Wednesday, 12th January. On current air schedules, it would not have been possible for an official representative to reach New Delhi from Australia before the morning of Thursday, 13th January. In these circumstances, the Minister for External Affairs appointed Sir Arthur Tange, C.B.E., Australian High Commissioner to India, as Special Representative of the Australian Government on this occasion.

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(Question No. 809.)


asked the Minister representing the Prime Minister, upon notice -

  1. What royal commissions, committees of inquiry, commissions and similar bodies have been appointed by the Government since 1949?
  2. Who were the members of these bodies?
  3. What was the cost incurred by each body?
  4. What was the date of appointment of each commission, etc., and when was its report presented to Parliament?
  5. If any of these bodies are still meeting, when are their respective reports anticipated to be finalised?
  6. What action did the Government take on any recommendations of these bodies?
Senator HENTY:

– The Prime Minister has supplied the following answer to the honorable senator’s question - 1 to 6. The information requested by the honorable senator relating to all royal commissions, committees of inquiry, commissions and similar bodies appointed by the Government since 1949 is not readily available, and a great deal of time, expense and effort would be required to obtain it from all Commonwealth departments and authorities. If the honorable senator is interested in bodies appointed in any particular field of activity, I shall endeavour to arrange for the information to be supplied to him.

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(Question No. 822.)

TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

asked the Minister representing the Minister for Immigration, upon notice -

  1. How many migrants from the United States of America and from Spain have entered Australia in each of the past five years?
  2. How many Department of Immigration officials have been stationed in the United States of America and in Spain in each of the past five years?

– The Minister for Immigration has supplied the following reply -

  1. The following numbers of “ settlers “ entered Australia from the United States and Spain during each of the five years 1961 to 1965 inclusive -
  1. The details are as follows -

    1. United States: In the United States migration matters are dealt with by the Australian Consulates-General in New York and San Francisco. The staff of the Consulate-General in New York was recently increased by one position. This Australia based position, which is part of the Department of External Affairs establishment, is occupied by an officer who was previously with the Department of Immigration.
    2. Spain: Until 1962 applications for migrato Australia from Spain were dealt with by visiting Australia based immigration officers from Italy. In May 1962 an Australian Migration Mission was opened in Madrid comprising four Australia based immigration officers and two specialist officers of other departments. A Consulate-General was established in April 1963, the Consul-General performing consular as well as immigration functions. Since the establishment of the Consulate-General the numbers of Australia based officers, including the Consul-General carrying out immigration work have been as follows -

April 1963-December 1964 - Four (and two specialist officers from other Departments)

December 1964-present - Two (and one specialist officer from another Department)

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(Question No. 835.)

Senator BRANSON:

asked the Minister representing the Prime Minister, upon notice -

  1. Does the Commonwealth Literary Fund provide the sum of $33.33 for each Australian Capital Territory issue of “ Poetry Australia “?
  2. Do53 major American universities receive this publication?
  3. Are there 25 libraries in New Zealand who are regular subscribers?
  4. Does each issue cost approximately $800.00 for printing alone?
  5. If the answers to the above questions are in the affirmative, will the Prime Minister give consideration to having the grant of $33.33 increased to a more realistic figure?
Senator HENTY:

– The Prime Minister has provided me with the following answer to the honorable senator’s question -

  1. The Committee of the Commonwealth Literary Fund at its meeting on 13th May 1965, approved a grant at the rate of $200 for one year, from 1st July 1965, to assist publication of “ Poetry Australia “, the first issue of which appeared in December 1964, and agreed to review the matter at the end of this period. 2 and 3. It Is understood from Information recently supplied by the editor that 60 major American university libraries and 25 New Zealand libraries subscribe to the magazine.
  2. The Committee has not yet received a statement of income and expenditure covering the period of the grant, but the editor has undertaken to supply this information by the end of April 1966.
  3. As stated in 1, the Committee of the Fund will review the matter in May/June next.

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Motion (by Senator Branson) - by leave - agreed to -

That leave be given to introduce a bill for an act to amend Section 91 of the Broadcasting and Television Act 1942-1965.

Bill, presented and read a first time.

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Motion (by Senator Henty) agreed to -

That Government business take precedence of general business after 8 p.m. this sitting.

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Motion (by Senator Henty) - by leave - agreed to -

That leave of absence for one month be granted to Senator Laught on account of ill health.

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Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Dame Annabelle Rankin) read a first time.

Second Reading

Minister for Housing · Queensland · LP

[11.41].- I move-

That the Bill be now read a secondtime.

The objective of the Bill is to place beyond doubt the legality of two administrative reforms designed to make aliens’ registration a more simple and efficient process. A procedure was introduced last year whereby necessary details for registration of an alien after arrival are secured at the time when he is applying, in his own country, for a visa for Australia, instead of forms of application for registration being collected at time of arrival in Australia. As was confidently expected, this has saved delay in clearing ships and aircraft on arrival in Australia and has ensured more accurate information about non-British migrants arriving here. From the alien’s point of view, the procedure has the advantage of permitting his application for registration to be completed with the help of the officer who is interviewing him about his migration to Australia, and, if necessary, with the assistance of a qualified interpreter also. A good deal of time and trouble is saved at points of arrival in Australia for migrants, ships’ staffs, and immigration officers. This is the more important because of the need to clear ships and aircraft quickly.

In addition, as another simplification, aliens coming to Australia for a stay of a year or less are not now required to be registered. In the past, registration was required for such aliens in order to provide a means of checking that they left when their authorised stay expired. Now a better way of doing this has been introduced. Each incoming alien completes the usual incoming passenger card. Instead of this being used solely for the Commonwealth Statistician’s purposes, it is placed in an alphabetical visitor index. The departing alien visitor completes an outgoing passenger card, and this also goes to the visitor index and provides (he necessary departure information. If no outgoing card is received, inquiries are then made. All this makes it unnecessary to obtain additional aliens registration forms from alien visitors.

The Bill contains eight clauses, the first two of which deal with the title and date of commencement. Clause 3 simply provides a definition of the exact time at which a person is to be deemed to enter Australia. Clause 4 can be understood by reference to section 7(1.) of the present Aliens Act which specifies that an application for registration must be made by a person who has arrived in Australia. Section 7(2.) of the Act exempts from this requirement a person who has previously been here and has been registered as an alien; but this does not satisfactorily provide for the alien who has never been in Australia before, has only completed an application for registration when applying for his visa to come here, and has not been registered. Therefore, an addition needs to be made to section 7(2.) of the Act, and this is done by clause 4 of the present Bill.

Clause 5 provides authority for our officers overseas to receive applications for registration, and to cancel them when the aliens abandon their plans to come here. Clause 6 provides the desired exemption from registration for aliens coming here for visits of a year or less. At the present time, section 8, paragraph (c), of the Act exempts only people coming here for 60 days or less, and clause 6 extends this to those coming for the longer visits in question. Clauses 7, 9 and 10 simply change the amounts of penalties from pounds to dollars. Clause 8 is another necessary consequence of the new procedure of accepting applications for registration overseas. It ensures that persons making false statements in such applications can be prosecuted, after entry to Australia, on the same basis as if they committed the offence in Australia.

I can assure the Senate that the changed procedures contemplated by this Bill will be of considerable benefit to non-British people coming to Australia and at the same time will ensure greater efficiency and accuracy in recording essential information. I commend the Bill to honorable senators.

Debate (on motion by Senator Fitzgerald) adjourned.

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Second Reading

Debate resumed from 31st March (vide page 382), on motion by Senator Dame Annabelle Rankin -

That the Bill be now read a second time.

South Australia

– The purpose of the legislation before the Senate is to make available to the States an extra $15 million under the Commonwealth and State Housing Agreement for the purpose of housing. Monies advanced are repayable over 53 years and bear interest at 1 per cent, per annum below the long term bond rate. The advances will be distributed on the basis provided for in the Agreement. The Opposition desires to move an amendment to the motion before the Senate and I, therefore, move -

That the following words be added to the motion: - “but the Senate is of opinion that the existing Housing Agreement has not fully met the housing requirements of the Australian people and that before a new Agreement (to which part of the money to be provided by this Bill may be applied) is entered into, a Select Committee of the Senate should be appointed to investigate all its aspects with particular regard to -

rental rebates

slum clearance

housing for pensioners

land development and

town planning.”

Honorable senators will notice that the proposed amendment is not a drastic condemnation of the Government. The last inquiry into housing needs was conducted by the Chifley Labour Government. As a result of that inquiry, the Commonwealth for the first time entered the field of housing. The Opposition points out in its proposed amendment that the existing Agreement has not fully met housing needs. We do not disparage what the Agreement has done, but it has not fully met the housing needs of the Australian people. We should, therefore, examine whether it should be replaced or amended.

The first matter which should be investigated is the amount of assistance that should be afforded by the Commonwealth. The Constitution provides very little authority for the Commonwealth in respect of housing other than by section 96, which permits the Commonwealth to state for what purpose money allocated to the States is to be used. This is possibly a very strong authority which permits us to operate in this way.

The Federal Government has recognised that it has a right to participate in housing by the establishment of a Commonwealth Department of Housing and the appointment of a Minister for Housing. The relevant Commonwealth legislation it has introduced is the Homes Savings Grant Act, the Housing Loans Insurance Act and the Aged Persons Homes Act. The funds allocated specifically for housing have been somewhat in accordance with the annual requirements of the States but last August when the relevant Bill was before the Senate we noticed that the allocation for the States was £350,000 less than that for the previous year. When this was queried by Opposition senators, we were told that the allocation had been reduced at the request of the State Premiers, who had said they did not need as large an allocation as they had received the previous year, but it was expected that there would be an expansion of industrial construction and, therefore, the labour force in the building industry would be fully employed. Obviously this expansion of industrial construction h s not eventuated and the reduction by £350,000 of the allocation for housing has resulted in a reduced building construction rate. This has had badeconomic repercussions. The number of approvals for houses and flats for the three months ended February 1966 was 22,293, compared with 25,681 for the previous year and 24,144 for the year before that. These figures show pretty clearly that there has been a significant decline in the rate of home building. Obviously this is the result of, amongst other things, the reduced allocation to the States, although, as I have said, the reduction was made at the request of the State Premiers.

This brings me to the question whether the Commonwealth should permit the State Premiers to decide what shall be spent on housing out of the annual allocations made by the Commonwealth to the Stales. When the decline in construction became apparent, the Commonwealth regarded the matter as so important that it immediately made available to the various banking institutions $24 million out of Reserve Bank funds to stimulate the building industry, and it has introduced the legislation now before us, which is designed to make an additional $15 million available to the State housing authorities. The Commonwealth has done these things, first, because any reduction of housing construction without housing needs being met is an indictment of the Government, and secondly, because such a reduction has an adverse effect on the economy. The Government could not afford to have unemployment in the building industry. It could see that the people would regard it with disfavour if the housing construction rate did not go somewhere near meeting requirements.

The Commonwealth Government must accept a bigger responsibility in ascertaining housing requirements. Those requirements must be met, irrespective of the call for labour in the field of industrial construction. It is not good enough to say that no unemployment will be caused by a reduction of housing construction because industrial construction projects will take up the lag. A Government must face the wrath of the public if the housing construction rate does not go a long way towards meeting requirements. A survey must be made to learn our housing needs and a programme of housing construction must be adopted and adhered to. This is what the proposed amendment seeks. The Opposition wants a survey to be made of housing needs and a plan to be formulated to meet those needs.

The number of homes constructed by government organisations has in fact increased. The only figures available relating to this aspect are those contained in the official “ Year Book “. The statistics for houses approved show that in 1959-60. private enterprise was responsible for 75,009 homes and government instrumentalities were responsible for 11.235. In 1963-64, the number in respect of private enterprise had fallen to 73,461 while the number attributable to government authorities had increased by more than 5.000 to 16,634.

This trend is repeated in the figures relating to houses completed. In 1959-60, private finance was responsible for the completion of 69,396 homes and government finance was used in respect of the completion of 12,234 homes. In 1963-64 completed homes financed privately fell by almost 2.000 to 67,917 while completed homes built with government finance rose by almost 1,000 to 13,197. The trend shows that governments are accepting greater responsibility for home construction. The majority of homes built today are being constructed with government assistance or government finance.

To meet the situation, the Government has introduced various schemes to encourage home ownership but these are mainly baits to catch votes rather than part of a definite policy based on needs. The Government introduced a system of homes savings grants. This scheme provides that those who save £750 over seven years or within a period of three years may receive from the Commonwealth £250 or $500 tax free for the construction of a home. Although this grant might be beneficial to those who receive it, I said when the scheme was introduced that the grants would not encourage the construction of additional homes. Those persons who receive the grants would have built homes even if the grants had not been available. The grant is paid at a time when it is not available to help to bridge the deposit gap and it favours those who do not need the money more than those who do need it.

While savings over a period of seven years can be taken into consideration in establishing eligibility for the grant, the full amount of the grant can be obtained only if the total amount of £750 is saved over that period. The period from the time a couple anticipate building or purchasing a home until they actually build or buy one is rarely seven years. Usually, these provisions would apply only to married couples who planned to have a house in less than seven years time. It is fair to say that those who could build a home immediately would not delay building for three years merely to obtain a grant of £250. Therefore, the scheme does not encourage the construction of more homes.

Those who cannot save the whole £750 in the stipulated time can receive only a proportion of the government subsidy. Therefore, many applicants for the homes savings grant cannot receive the full amount because they cannot save the required amount in the stipulated time.

Then in 1965 we had the Housing Loans Insurance Bill. Some members of the Opposition said at that time that the housing loans insurance scheme would not provide additional money for home building, but would merely provide guarantees for money lenders who lent money on homes.

Senator Wright:

– Only special classes of them - very special classes and very restricted classes.


– I think the scope has been extended. Eventually we will hear what the legislation has achieved and will be told of the amount of coverage of loans other than those for housing construction. An indication that the Government realises the worsening conditions regarding home ownership is that it makes provision for the guaranteeing of loans for purposes such as the provision of kerbing, for road making, for additions to homes and for renovations. The view of the Government is that, by permitting increased loans on homes, it will help to bridge the deposit gap, but when there is only a limited amount of money available for home finance any reduction of the deposit gap or any greater amounts lent on individual homes must cause a reduction of the number of dwellings constructed.

I respectfully submit that all of the activities of the Commonwealth Government in this field have not increased home construction. Indeed, there is a reduction in the number of homes being built. The Ministry of Housing was established to increase the construction of homes. The homes savings grants legislation and the housing loans insurance legislation are in operation, but the rate of home construction is declining - and this at a time when the Government cannot afford to permit it to decline. The Commonwealth Government is determining the rate of construction of homes in Australia, even in the private sector, by such means as the release of money from the Reserve Bank for housing finance. However, its calculations seem to be based on the possibility of unemployment occurring in the building industry and on the knowledge that it would be ridiculed for allowing a worsening of the position when so many people are waiting for homes. I maintain that we should have some plan for home building and should not just pump money into the industry when something is wrong with it.

The other scheme of the Government in regard to housing is the aged persons’ homes scheme, which, as it applies today, provides, with a few exceptions, only for the provision of homes for aged people who have between £700 and £1,500 to invest or pay as key money in order to get homes. The Government’s £2 for £1 subsidy is at present being received by institutions that demand a deposit before they will let a home to an aged tenant. The deposit required in New South Wales is, I am informed, sometimes as high as £1,500. The scheme does not provide housing for pensioners who do not have the required deposits. I am informed that in New South Wales there are 6,000 pensioners on the waiting list for the State Government’s pensioner flats, which are restricted to people of 80 years of age and over.

Senator Wright:

– To what extent do institutions in New South Wales require such a deposit - 20 per cent, of them, 50 per cent, or 2 per cent.?


– I cannot give the honorable senator that information. I am more familiar with the position in South Australia. I do not know of any organisation in that State which builds pensioners’ homes with the £2 for £1 subsidy and does not require a deposit.

In any community there are people who cannot provide themselves with homes. They are those on low incomes, those with big families and those who are bad managers of their finances. In all capital cities there are people who know it is hopeless to endeavour to provide themselves with homes. They must be given some Governmental assistance. The first Commonwealth participation in a housing scheme was under the 1945 legislation, the purpose of which was to provide assistance for people who were unable to provide themselves with homes. Until then, housing was a State responsibility. But after that the Commonwealth, under the Chifley plan for a more equal distribution of wealth, made grants to the States repayable over 53 years. The Schedule to the Commonwealth and State Housing Agreement Act 1945 states - (1.) Each State agrees that tenants of dwellings may be granted a rebate of rent calculatedin such manner as may from time to time be agreed upon between the Treasurer of the Commonwealth and the Treasurer of the State and unless and until otherwise agreed, in the manner provided in this clause (but so that in no case shall the rent of a dwelling be less than eight shillings per week.).

It was agreed that economic rents would be determined on the basis of the cost of construction of houses, plus interest charges and the cost of preparation of roads, kerbing, and other amenities in the area attributable to the houses. Those costs were to be grouped together and divided among the number of houses to find the economic rent. The schedule continues -

  1. if the family income of the tenant is equal to the basic wage the rebate shall be an amount equivalent to the sum by which the economic rent of the dwelling exceeds one-fifth of the family income;

Then there is provision that if the family income - which includes the income of all members of the family - is equal to the basic wage, the Commonwealth will subsidise the State to the extent of the difference between the economic rent and one-fifth of the family income. The Schedule continues -

  1. if the family income of a tenant is less than the basic wage the rebate which would have been granted if the family income had been equal to the basic wage shall be increased by one-quarter of the amount by which the family income is less than the basic wage;

As I have mentioned, there was a provision in the legislation for a minimum rent of 8s. a week. Of course, this system embraced those receiving incomes above and below the basic wage. If the income of a family exceeded the basic wage, the subsidy was decreased by one-third of the amount by which the income exceeded the basic wage. Therefore, as the income increased the renting of homes became a more costly proposition.

Essentially these were homes for those in the community whose incomes did not allow them to provide homes for themselves. They paid according to their incomes rather than according to the accommodation they required. Under the 1945 legislation there was provision for the erection of homes for the purpose of sale, but the Commonwealth and State Housing Agreement Act of 1955 altered this position somewhat. The Housing Agreement Act 1956 contained provisions for the granting of money to the States for the purpose of the construction of homes for rental to people on low incomes, or for the purpose of building homes for purchase. The Act contained the proviso that 30 per cent, of the money allocated to the States had to go to building societies. This has resulted - I am speaking of South Australia because I know something more of the position there - in a curtailment in recent years of the construction of homes for rental purposes. Almost the only homes for rental purposes now are expensive flats built by private enterprise or flats built by the housing trusts. The housing trusts are not providing group rental homes. They have a system of providing homes for purchase on £50 deposit, the balance being paid over a period of 42 years. There is four to five years’ delay in the purchase of a home on the £50 deposit basis, but people who can pay somewhere near one-third of the cost of a home as a deposit can purchase a home without undue delay.

This system does not provide for those people who, because of their economic position, need rental homes, nor does it provide for those who, while they can pay a deposit of £50, cannot afford the repayments and the rates and taxes for which the owners of dwellings are responsible. Many people who buy homes on a £50 deposit find that as their family increases and as their financial commitments grow, after meeting the repayments and paying rates and taxes they are left with insufficient money to carry out normal maintenance on the dwellings. At present we see that many dwellings are deteriorating because the people in them are unable to carry out the necessary maintenance. There are people who are not in a position to purchase homes and have no particular desire to do so, but at the present time they are being forced into purchasing homes. Many people who cannot purchase homes are left with no alternative than to rent, at high weekly rates, dilapidated slum dwellings that have been converted into apartment houses. The position will get worse as the needs of the community increase. Any Commonwealth grants to the States for housing purposes in the future will have to be on the basis of an increase in the previous year’s allocation, not a reduction.

I have some figures, taken from the “ Year Book “, which show the annual averages of live births for 4-year periods from 1926-30. There has been an increase each time. If we take the births for the period 1941 to 1945, the people born in those years will now be reaching the age when they will require housing at some time in the near future. In planning we must look not only at future housing requirements but also at present requirements. I think it is generally agreed that at present 70,000 to 80,000 applicants are waiting for State Housing Commission homes throughout the Commonwealth. From time to time we hear arguments as to whether these are the correct figures, because it is often found that when people are due to be allotted houses they have found their own accommodation. It is apparent that the present Housing Agreement is not meeting the present housing requirements, but without holding a thorough inquiry it would not be possible to discover how far it falls short of doing so. While the housing grant last year was £350,000 less than the allocation for the previous year, the Minister in the second reading speech assured us that there was no need to worry because industrial expansion would take up any slack in the building industry.

Senator Wright:

– In what did the honorable senator say there was a reduction of £350,000?


– In the grant to the States last year compared with the grant for the previous year.

Senator Marriott:

– Was not that because one State did not want what was offered to it?


– That is what I have been trying to point out. It was done at the request of the States. It has been alleged that the South Australian Labour Government requested the reduction in the overall allocation from the Commonwealth. This has been verified between the South Australian Labour Premier and myself. This happened at the time when the Labour Government took office. After it had budgeted for all other requirements, it found that it had to make some curtailments in the housing programme in South Australia. We have seen that the Commonwealth cannot permit the States to make the decisions in this matter, because the Commonwealth has released $24 million through the Reserve Bank and this Bill provides for $15 million. It may be politic in the future for the States to ask for lesser amounts for housing, knowing that the Commonwealth could not permit them to operate on reduced housing grants. So the States may receive larger grants, although they may not ask for them.

Although there was a reduction in last year’s allocation, we were assured by the Minister that it would cause no injury to the building industry, because any excess labour force in the building industry could be absorbed by industrial expansion. But this never materialised. Slackness and some unemployment have occurred in the building industry, but I am pleased to say that in South Australia, at any rate, the position has been rectified within the last few months.

The Minister for Housing in her second reading speech said -

Meanwhile there was a great amount of other building going on and there appeared to be very little spare labour in the industry. The Government attaches a very special importance to home building as an element in the economy - this for several reasons.

Later, the Minister said -

The Government believes that dwelling construction ought to be kept up to the highest practicable level; by which I mean practicable in relation to the resources of labour, materials and equipment available at any time. It is no use trying to push things beyond that point; in fact it would be foolish because all you would get would be delays in construction, rising costs, and a drain of resources from other important activities.

We see from that expression of Government policy that if the requisite materials and labour are available homes will be constructed. But, of course, it is not good enough to give the construction of homes second priority. This means that if there were to be a large expansion of industrial construction in Australia next year home construction would be sacrificed, and this would occur at a time when the demand for homes would be greater because of the increased birth rate which occurred 20 or 25 years ago.

We must first plan for the number of homes required. We cannot simply neglect the industrial expansion that is necessary; nevertheless, we should look at this question and see how many homes are needed. If the supply of labour and materials is not what it should be, surely an inquiry should be conducted with a view to improving the supply. However, we cannot make provision for the requisite labour and materials until we know what the extent of the needs will be. If housing needs were surveyed we would know what the requirements are likely to be. We would also know the requirements due to industrial expansion, and we could then make plans accordingly for the labour force.

It is unfortunate that today there is a reluctance to work in the building industry if other employment is available. The building industry is not one of the attractive industries. The nature of the industry means that building workers must move from site to site. For that reason, amongst others, it is not as congenial as are other industries. However, there is an even greater deterrent to the entry of new employees into the industry. I refer to the fact that the apprenticeship system in the building industry has completely broken down. Today, the building industry operates almost entirely on a sub-contract basis because of a desire to avoid observance of the wages and conditions provided for by awards. The builder who has continuity of work does not employ permanent labour and cannot engage apprentices. He sub-lets all his work. Sub-contractors are not guaranteed continuity of work, and this prevents them from employing apprentices. As a result, there is a shortage of trained labour in the building industry.

Among those responsible for this condition in the building industry are government departments in both State and Commonwealth spheres. Despite the fact that their building activities are great, they do not insist on award wages being paid or award conditions being observed, nor do they insist on day labour which would permit builders to engage apprentices. The Labour Government in South Australia, having seen the plight into which the Housing Trust in that State had got through the encouragement of sub-contract work, in desperation made it a condition of future contracts that a certain number of young men had to be employed on work let by the Trust. This was agreed to by the builders who stated the number of youths they would employ on the sites. But the youths were to be employed in only one of the various operations connected with building construction. The position today is that one man and six boys are engaged on a particular building operation, but on all the other building construction jobs trained adult labour, which is in short supply, is employed. Unless we have a plan for the solution of this problem we shall proceed from one dilemma to another.

The South Australian Government attempted to improve the position, although its attempt was not successful, but the Commonwealth does not insist on any such provisions applying to Commonwealth construction works. I have repeatedly asked the Department of Works to do this, but I have not received an assurance that it will do so.

Senator Wright:

– Is the honorable senator’s complaint that the Commonwealth Government is not making the mistake that the South Australian Government made?


– At least the South Australian Government has attempted to do something in the matter. It recognises that the method it adopted has failed and I have no doubt it will attempt to alter the position. But the Commonwealth Government has not attempted to do anything in the matter. 1 doubt whether it realises the importance of the position or recognises that this is one of the reasons why there is such a dearth of junior labour in the building industry and that this will lead to a corresponding dearth in the number of tradesmen in the industry in the future.

If an inquiry were to be held in order to ascertain the needs of the building industry the Government would be acquainted with the position of the industry and would know how it could be improved. That might influence the Government to do something in the matter. However, the Department of Works seems to operate on its own. I do not know whether it lacks knowledge of the position. The Department appears to think that it has achieved something when it merely lets a contract for a particular job. It is concerned to have work constructed to a certain standard and according to certain specifications, but it does not realise what may happen as a result of its lack of concern for other matters which relate to building construction projects. I do not know whether it is the responsibility of the Department of Works to train operatives in the building industry or whether that is the responsibility of the Department of Labour and National Service. However, one of those Departments should have knowledge of the needs of the industry in this respect and should do something to meet them. If the building construction work which the Commonwealth Gonvernment is undertaking today could be called out under a system which would permit the employment of apprentices, the very volume of the work would solve many of the problems.

It is not only the Australian Labour Party which holds the views on this subject that I have expressed. Many authorities recognise that the building industry is a sick industry which needs remedial measures to make it well again. But we cannot make it well until we know the ailment from which it is suffering. We must know how to prescribe for that ailment. That is why I ask the Government in all sincerity, and not with any desire to attack the

Government, to cause an inquiry to be held for the purpose of ascertaining our housing needs and of devising means to meet them.

Senator Gair:

– Does the honorable senator suggest that no agreement should be signed until that is done?


– No, I am not suggesting that. The present agreement will expire in June of this year. Before we enter into the new agreement we should know what the housing needs of Australia are, and we should plan to meet those needs. Our proposal is that the inquiry should go further than this. I shall refer to this matter later. I have said that the housing industry is a sick industry. In an article in Saturday night’s Melbourne “Herald” Robert Coleman described the feelings of many people concerned with the industry. He wrote -

They say the housing finance sector of the economy is sick and that it will take more than an occasional shot in the arm, like the recent $15 million handout to the States, to put it back on its feet . . . Leaders in the industry say the blame lies squarely with the Federal Government because- directly or indirectly - the Government or its instrument, the Reserve Bank, controls most of the money which flows into housing from lending institutions.

This was followed by a report in the same newspaper on 18th April, which read -

An overall, long-term housing plan for the future of the building industry was urgently needed, the national secretary of the Real Estate and Stock Institute, Mr. F. J. Foy, said today.

Mr. Foy said the plan, which would have to be on an Australia-wide basis, should be prepared at Government level after full consultation with all sections of the housing industry.

The last full-scale, authoritative fact finding on the housing situation was the Commonwealth Government’s Housing Report of 1945, Mr. Foy said.

Senator Wright:

– It recommended the complete nationalisation of all land in Australia, did it not?


– No.

Senator Wright:

– I think it did.


– I do not want to say that it did not, but I am confident that it did not suggest the nationalisation of all land in Australia. But the Government accepted sufficient of the committee’s report to bring in a bill for the purpose of subsidising rental rebates and for other purposes. If the committee did find that land should be acquired, it was a finding based upon the evidence received at the time. Let us have now a committee which will seek evidence on the question, and let us see what are the findings of that committee. Adoption of the findings would then be a question of Government policy, but the Government would be determining policy with a knowledge of the situation. It would be accepted in the industry generally that there is some need for this.

I just want to point out that something has gone wrong with the building industry in comparison with other industries, as indicated by the “ Year Book “, which contains the figures of the Commonwealth Statistician. Let us look first at the consumer price index, which shows weighted averages, with 1953 prices having an index of 100. At the December quarter of 1964 prices in the food group had risen to 132.1, whereas prices in the housing group had risen to 164.4. There was a continual increase in prices up to 1964, which is the last year for which the yearly figures are available. The quarterly figures for 1964 show increases in the housing group far in excess of the increases in the food, clothing and drapery, household supplies equipment and miscellaneous groups.

Senator Wright:

– What is the base year?


– The base year for all of the groups is 1953, but while the food, clothing and drapery, household supplies equipment and miscellaneous groups moved on an even keel, the housing group jumped in the December quarter of last year to an index figure of 164.4. The food group, which also started in 1953 from a base figure of 100, rose in the December quarter of 1964 only to 132.1, the household supplies equipment group to only 111.3, and the miscellaneous group to only 136.5. There has been a big rise in the housing group prices, which is altogether out of proportion with the variations in the other groups.

Let us look at the index for wholesale prices of basic materials and foodstuffs. The base of the index is 100, which is taken as the average of prices in the three years ended 30th June 1939. In 1962-63 building materials rose to 439. The increase has been continuous and in February of this year the index figure stood at SOS. This increase is proportionately much bigger than the increases in metals and coal, oil, fats and waxes, textiles, chemicals, rubber and hides. The table shows that in 1962-63 building materials started with an index figure of 439, which was higher than the figure of 432 for textiles, and much higher than the figures for the other commodities. In 1963-64, the figure for textiles was 484, compared with 473 for building materials. In February 1965 the figure for textiles was 416, while building materials had risen to 505. This is out if proportion. The cost of building materials jumped higher than costs in all of the other groups named in the index.

Why is this happening in the building trade to a greater extent than in industry generally? The surprising position is that wages are not contributing to this increase. Let me refer to the table showing weekly wage rates, by industry groups, of adult males. The base is the weighted average weekly rate in 1954, which is taken as 100. We find that in 1945 there was no comparison with the level in 1954, but there was some uniformity of wages, the figure for mining and quarrying being 49.1- and the figure for building and construction being 42.4. All the other industries listed were at about 40 or 41. In 1964, when the building and construction figure had risen to 141.7, the figures for many of the other industries were higher. In 1 945 the weighted averages of wages in various industries were somewhat on a par, with mining and quarrying being in excess of the others. That is seen, to be the position in 1964, so wage increases in the building industry have been comparable with increases in industry generally. Yet, as shown by the consumer price index, costs in the housing group have risen in excess of the rises in the other groups. This is something that needs explanation and control, because we do not know where it will end.

Senator Wright:

– What does the honorable senator say is the order of the difference? I heard the figures, but what is the discrepancy, in substance, in costs as between the building industry and other industries?


– I could not say, without a calculation based on the figures in the “Year Book”. It is undoubted that building costs have risen out of all proportion, whatever the percentage is. This is a single industry in which costs have risen out of proportion to increased costs in industry generally. Why should one industry get out of line with industry generally? The reasons that I advance would possibly be described as propaganda. It may well be because we have never nationalised land transactions and have not reduced the sale price of land. This is something that a committee of inquiry might well bring into line.

The 1945 legislation made provision for slum clearance, land development and town planning. The amendment seeks an inquiry into this problem. Slum clearance in older localities around the centre of the cities is a pressing problem an all States. Because the value of this land is greater than that in outer areas, the cost is beyond the capacity of the various governments, which have many other works to undertake. This must slow down the clearance of slums. In some cases courts have been told of conditions that are detrimental to health. But whilst we may condemn houses as being unfit for habitation, we cannot eject the tenants unless there is somewhere else for them to go.

Senator Prowse:

– What authority has the Commonwealth in this field?


– I am suggesting that the Commonwealth accepted authority in 1945. It has authority under section 96 of the Constitution to allocate moneys and to stipulate the conditions upon which it may be spent.

Senator Wright:

– And it has a Ministry of Housing.


– What we are suggesting is an inquiry into the requirements of the States. We suggest that the Commonwealth then, knowing the needs, should allocate the money accordingly. I have already referred to the urgent need for the housing of pensioners who are in distress, lt seems to me to be wasteful to give extra assistance to pensioners for the payment of rent when that assistance meets only part of their need. If the 1945 scheme of rental rebates were again put into operation, the Government would not now have to bear the total cost of such rebates but only that cost less the sum we are now paying by way of rental assistance under the social service legislation. Every State has its own committee and its own legislation covering land development and town planing, but whether the State plans can ever be put into operation is problematical.

I suppose that the Government will be obliged to oppose the amendment. We moved a similar amendment in August last when we were considering the Commonwealth and State Housing Agreement. We suggested that the matters we have been discussing today should be considered before a new agreement was entered into. As the Minister indicated in his second reading speech, the States are unable to meet their requirements and to expand building operations if they have not the necessary labour and materials. And this Government is unable to make the necessary provision if it does not know the needs and the demands. The Government should agree now to the appointment of a committee to inquire into the situation. If it will not do so, it should seriously consider entering into a short term agreement at the expiry of the current Agreement so that, before a new long term agreement is entered into, a committee may be appointed and have time to present a report.

The ACTING DEPUTY PRESIDENT (Senator Wedgwood). - Is the amendment seconded?

Senator McClelland:

– I second the amendment.

Sitting suspended from 12.45 to 2.15 p.m.


– The Senate is discussing a Bill to give effect to the Government’s policy of injecting into the economy another $15 million for the purposes of housing in Australia. This Bill should not raise the ire of any honorable senator but should bring to the Government some expressions of appreciation for the action it is taking. In time past it has been thought that the Federal Government did not have much responsibility for housing, but time and actions have shown that this Government not only realises its responsibility but, to the best of its ability, is giving effect to its housing policy.

It is well known that this Government has an amazing record in respect of war service homes. With the establishment of the Commonwealth Department of Housing it appears that the Commonwealth is entering more and more into this important field. This year the Commonwealth Government has already provided $102 million to the States under the Commonwealth and State Housing Agreement. It has proved to be an excellent agreement for Australia and a useful one for the States; first, because it has given the States the wherewithal to provide housing; and, secondly, because the policy laid down by the Commonwealth in respect of housing is that 30 per cent, of the moneys made available to the States must go to building societies and such organisations for private home building. So we are not getting the complete control of housing in the States, as was recommended through nationalisation in 1945. Of course, if the Socialists came to power, they would strive to implement that policy.

Out of the amount of $15 million to be advanced to the States, Tasmania will receive over $1 million in the latter part of the year for housing needs, making its total of moneys received this year under the Commonwealth and State Housing Agreement nearly S7i million. Building societies will receive $314,000. As honorable senators are aware, money for housing is provided to the States on loan for a period of 53 years at an interest rate of 1 per cent, per annum lower than the current rate for Commonwealth bonds. I wish to ask of the Minister a question which may have been answered many times before. If so, the answers have escaped my notice. As the money that the Commonwealth provides to the States comes mostly from revenue, I would appreciate an official explanation of why interest is charged thereon to the States and of why it is charged at a rate of 1 per cent, lower than the current bond rate.

There can be no opposition to this Bill, but this afternoon we are faced with a lengthy amendment proposed by the Opposition. In effect, the Opposition wants set up immediately a select committee of the Senate to inquire into all aspects of housing. The Senate has been officially informed that next week or the week after that we will receive from the Government for debate a Bill to renew and amend the Commonwealth and State Housing Agreement which has been in operation under the current legislation for five years and expires on 30th June next. The legislation is to renew the Agreement for five years.

It is obvious that the State Governments - of whatever political party - have put their views. They have experience in housing matters and no doubt that experience has helped them to put their views to the Commonwealth. The Commonwealth has considered those views and next week or the following week the Minister is to introduce a Bill so that the Commonwealth and the States will know from 1st July what is the nature of the Agreement.

The Opposition in the Senate is asking that a select committee be set up at this stage to investigate all aspects of housing. I do not care how hard such a committee worked or how sincere or brilliant it was in its approach to housing problems. I dare say that no committee of the Senate could carry out the terms of the amendment in a period of under eighteen months to two years. I believe that at the end of that time it would furnish information practically all the details of which are now known by the State Ministers and the Commonwealth Minister for Housing. The only result achieved would be for the Commonwealth and the States to enter into a period of at least 12 months, if not two years, when no agreement was operative. For that one salient reason, out of hand, I oppose the amendment. I also oppose it on other grounds. I fear that it has been hastily drawn up with this thought; “ We cannot oppose the legislation, lt is good, but we cannot let the Government get away with thinking that we realise it is good, so we will propose an amendment.”

When the Bill is introduced to renew the Agreement I will be interested to learn whether the State Ministers and the Commonwealth Minister have examined the matter of rental rebates. If not, I will be interested to find out what is the situation. The Opposition also wants a select committee to examine slum clearance, housing for pensioners, land development and town planning.

Senator Cavanagh:

– Does the honorable senator not think that we should?


– I do not think the Commonwealth Parliament should do so at this stage. I believe, as every honorable senator does, that anything that can be done to rid the cities of their slums should be done. However, I believe that first and foremost it is the responsibility of the Governments of the sovereign states where the slums are situated to work hand in hand with local government bodies to clear the slums. State governments and local government authorities have a prime responsibility in this matter. All they want to know is how much monetary help they will get from the Commonwealth Government to enable them to carry out their work.

I can well imagine the State Housing Ministers and the local government authorities objecting very strongly to a Senate select committee questioning them about this matter and finally producing a report telling them how they should plan their cities and towns and how, why and where they should rid their cities and towns of slums. I suppose it is part and parcel of the Socialist outlook that the central government must be in control and so, not content with a fair share of Socialist State Governments in power, the Socialists want to take over command right at the top.

At the commencement of my speech I did not refer to Senator Cavanagh’s remarks. Now let me say that I think the Senate was happy to listen to a speech on the important aspect of housing but having very little to do with the Bill before us. However, it was a well informed sincere speech on the problems confronting people who wants homes, the problems confronting the building industry and the ever present problem of the growing cost structure. His speech today was similar to the speech he made to the Senate last September on a different aspect of housing. On that occasion we were discussing the new housing agreement. The Senate debate came to the notice of a well known journalist and political commentator, Mr. Frank Chamberlain, who writes a weekly article in the Hobart “Mercury”.

Senator Cavanagh:

– But he is not very highly respected.


– The newspaper is very highly respected and is often quoted by commentators on the mainland and by politicians on both sides of the Parliament.

However, I am not on a praising expedition. I am merely mentioning this to the Senate because it is about time we woke up to the fact that some of the things said in this chamber are noted not only by pressmen but also by departmental officers. Surely that is one of the main reasons why we speak in the House. We hope that Ministers and departmental officers will read “ Hansard “ and learn some new methods of approach to the problems confronting them. In this article Mr. Chamberlain wrote -

Such was the background to an important debate in the Senate which received little general publicity throughout Australia but which has attracted the attention of the Housing Department, the Treasury and those officers who assisted in the preparation of the Vernon Committee’s report.

The Senate in the past week rose above party argument, putting the needs of the States in stronger terms than have been heard in the Lower House.

Senator James Cavanagh (Lab., South Australia) set the pace.

The article then refers to the fact that senators on both sides of the House put up propositions and suggestions from which the Commonwealth Government and the Slate Governments could learn to the betterment of housing in Australia.

As I have said, legislation relating to the housing agreement will be coming before the Senate. The legislation now before us is only a small part of that relating to housing. I feel confident that the Senate will not accept the amendment proposed by the Opposition because it will cause unnecessary delay to the implementation of the new housing agreement, it will accomplish nothing and very little will be learned from it having regard to the length of time it would take to implement. I will not prolong my speech on this subject. There are quite a few things I want to say about housing but now that the States and the Commonwealth have got together I am prepared to wait for the legislation which shortly will be coming before us. I congratulate the Government for taking the correct action in injecting another $15 million into the building industry in Australia in an attempt to provide additional homes for the people.

Senator DITTMER:

. -Senator Marriott said that some of the statements made in this place are noted by certain people. He need have no worry that he will be called upon to acount for what he has said. He suggested that if the amendment proposed so ably by Senator Cavanagh were accepted, it would occasion delay. Senator Cavanagh stated specifically that if there was not sufficient time to conduct the survey before the end of the financial year, we could enter into a short term agreement with the States. Let us face this issue realistically and then let the Government produce something substantial based on fact and on the needs of the people.

When we are confronted with an issue of such great social importance as meeting the housing needs of Australian families, both young and old, it is just ridiculous to have an arrangement to curtail the debate in this place. I understand that a senior member of the Government wishes to leave the Senate at 5 o’clock. I do not quarrel with that because I know that certain arrangements have to be made and certain commitments met, but I do not see any reason why such a particularly important debate should be curtailed. I want to make that quite clear right now. I have not known the Minister for Housing (Senator Dame Annabelle Rankin) for very long because she is not so old, but I should think no one would realise better than she does the urgent need for housing for the people. Never have I heard her express anything but sympathy for the people in need, whether they be invalid or age pensioners, old people looking for accommodation or young people looking for a home. She has always expressed her sincere sympathy for them. Yet here she is entrusted with the handling of a Bill which reflects the Government’s typically parsimonious approach to a really urgent social problem.

I will not traverse the figures which were mentioned by the honorable senator in quite a measure of detail. Suffice to say that we all realise the urgent need for many more homes to be constructed but never has the Government acceded to our pleas. I thought Senator Cavanagh was extremely courteous this morning in making only a request, not even a demand, for a proper and efficient investigation into this subject. Demands have been made before but in my experience in this place the Government has never agreed to a proper investigation of housing needs. What we want is a survey, not from year to year, but to cover a period of years to establish housing needs. The State Governments with their limited finances and other facilities have tried to meet the needs of the people, but every housing commission office in Australia has thousands of applications for homes.

The Minister for Housing has been here longer than I have although she appears to be younger than I am, and she knows as well as or better than I that many thousands of people in Queensland do not apply for a home because they know they have no possible chance of getting one. Only comparatively recently a survey was made in Brisbane. A search was made for a home and the result was described in a Brisbane newspaper. The heading to the article stated that $3,200 in cash was needed to build or buy a house and the subheading read: “ Same Old Story . . . Scarcity of Funds.” This article shows that the Government has a callous disregard for the people’s needs. It is a hopeless and socially irresponsible Government. The article in the Brisbane newspaper stated - lt is impossible for an average man with less than $3,200 (£1,600) in ready cash to buy or build a house how and where he wants it in Brisbane.

The reporter did not include the select or socially superior suburbs of Brisbane but related his article to the parts of Brisbane where a working man and his family would aspire to live. The report continued -

Three conclusions 1 drew after having visited two major insurance companies, two banks, two co-operative building societies and the Queensland Housing Commission were:

Co-operative Housing Societies have nothing to offer the man in the street for at least two months.

Without an $8,000 (£4,000) life assurance cover, or an established bank account with a sound banking record over at least 12 months, the only avenue of home finance available to the ordinary man is the Housing Commission.

Aside from houses built in a few selected areas, even the Housing Commission requires the applicant to have a minimum of $3,200 (£1,600) in cash.

This, incidentally, refers to what we would colloquially call the sticks. These areas in many cases are far distant from industrial establishments, and transport to and from them costs a fortune. In replying, the Minister for Housing need not say that this applies only to the Brisbane City Council transport because it applies equally to the railways. I am anticipating her reply in that regard. The article continued -

In my round of the home finance institutions, I quoted cash assets of $2,000 (£1,000), with no established banking record and no heavy insurance cover.

How can the ordinary person have a heavy insurance cover when the workers are denied wage justice? The article continued -

I had no chance whatever of raising a loan from insurance companies, banks, or co-operative housing societies.

This Government, or its immediate predecessors, saw fit to demand of the State Government authorities that no less than 30 per cent, of housing funds allotted to them should be devoted to co-operative building societies but the societies have not done a tremendous amount and have not met the needs of the ordinary person. The newspaper article continued -

Both co-operative housing societies I visited turned me down flat. At the first I could get no further than the inquiry counter. I was told there was no chance whatever of raising a loan.

The second society said there was no hope before the end of May at the earliest when they would take names for a waiting list.

A selection would then be made because, as we all know, all enterprises have a habit of picking favourites to benefit from a particular course of action. I know it will be said that this is simply a grant to speed up the building industry, to pick up a lag and to harden one of the soft spots in the economy. There are many of these, as has been admitted by senior Ministers in the other place. With this Government’s stop and go, catch as catch can methods, even if this hole is stopped temporarily there will still be weak spots in the economy because this Government has no idea of a planned economy in relation to housing or anything else. It seems peculiar that whenever anything is to be done for the ordinary people who really need help, the Government seems loath to act. These are the people who have made their contribution to the economic and social welfare of Australia, or they are the younger people who are now making their contribution. Any benefit obtained for them. whether it is in the field of pensions or housing, has to bc wrenched out of the Government.

I mention Queensland as an example, not because I have a parochial mind but because I know its problems. In that State we have had a certain type of Government since 3rd August 1957. It announced that deposits required to purchase homes would be reduced. Certainly the Government has introduced a system which provides a measure of concessions by way of low deposits. But when we know the areas where the homes are to be built and the type of person to whom they are offered, we realise how impractical the scheme is.

The housing commissions in Queensland and other States have thousands of applicants waiting for homes. One case came to my notice only last week and it could be multiplied many times. I know this because although the Minister works hard, I work as hard or even harder for the people in need. In the case which was brought to my attention, three families were living in one house. Certainly they were related, but imagine three families occupying three bedrooms, one dining room and a small kitchen. There was no lounge room. The parents were in one room. A daughter, her husband and a child occupied another room. Her brother, his wife and three children occupied the other bedroom. The Government is in charge of the administration of the nation and therefore it speaks for Australia. It claims that Australia has an affluent society. Yet we cannot meet the needs of either young or elderly people.

Something was done under the Commonwealth and State Housing Agreement of 1945. It provided a measure of assistance for 10 years to people who were not in a financial position to help themselves. It also provided that the pensioners would receive a rental rebate. A number of houses were built in the various States. I know pensioners who had good modern accommodation for 8s. a week. Families on the basic wage or less than the basic wage, with income from their children’s wages, paid only one-fifth of their income as rental. The nation as a whole accepted the responsibility under this rebate system. But as soon as this Government was in a position of authority and able to write a new agreement, this provision had to go out. The Government showed a callous disregard of its social responsibilities.

Where could those people go? They had to go to their relatives. I hope the present Minister, with her sympathetic approach to the problems of families, will realise that living with in-laws - not that she has ever had to do it - is not the best way of achieving domestic peace. Many families have been broken up over the years because of in-laws living together - not because any of the parties was impossible to live with, but because different people have different temperaments and on particular days may have different moods. A mother-in-law - I am not going to exonerate fathers-in-law - may have an authoritative approach which results first in argument and ultimately in bitterness. The present position is totally unacceptable in an affluent society. Young married couples, who make a contribution to the economic welfare of the nation, are entitled to their chance of happiness, but often, due to lack of housing, their marriages are broken up. The Government must answer for this, yet its approach to housing is, not to make a survey to ascertain the needs over a number of years, but, as Senator Cavanagh said, to say: “There is a bit of a lull or a soft spot, so we must stimulate home building.” The Government is concerned with the building of homes, but only to the extent of eliminating soft spots or unemployment in the building industry. It is not concerned with its responsibility to meet existing housing needs or to find a solution to this social problem.

Although the present Minister is new to her job, she has a comparatively long experience. I think she must adopt a more vital approach to this human problem. Thousands of homes are needed this year, and thousands will be needed next year. Most of us on this side of the chamber are concerned with housing as a human problem, not only as an industrial problem. We are concerned with the rights of people, old and young. I have found that the only young couples who have a chance of acquiring homes are couples in which both partners go to work. I realise that, in the minds of some people, it is desirable for both partners to a marriage to work. That is all to the good if it is a question of physical development or of ultilisation of mental endowments, but if a woman wants to rear a family I do not think that she should have to go to work to earn the money with which to pay a deposit on a home. I think we are entitled to deal in this debate with housing in general, irrespective of what some Government senators may say. The short speech delivered to us by the Minister - it covered about one and a half quarto pages - betokens the attitude of the Government. In the affluent society which the Government boasts that we have in Australia today, if a wife does not wish to go to work she should not have to do so merely in order to acquire the deposit on a home.

Over the years various schemes have been introduced to assist prospective home purchasers. One was the homes savings grants scheme, which placed on applicants a time limit of 12 months from the letting of the contract. I think that in this scheme the Government has shown a measure of disregard of the rights of people. In some cases, either through ignorance or illness, applications are made after 12 months from the signing of the contract, but the Minister has no discretion to waive the time limit provision. I am not saying that there should be a carte blanche authority, but even in such an irresponsible setup as the present Government I think the Minister for Housing, particularly the present Minister, would have a sense of social responsibility. In my view, the Minister should be able to say to a senior officer: “ Well, it was impractical or impossible for the applicant for this grant of £250 to have made application within the prescribed 12 months. Here is a special case in which I think the £250 should be granted.”

As honorable senators know, legislation was introduced by the previous Minister for Housing to guarantee loans, in the hope of bringing about lower deposits on homes. However, that legislation has achieved nothing. I hope that the Minister, when replying before she catches her plane - it seems essential to the Government to conclude the debate at an early hour-

Senator Gair:

– You agreed to that, to the exclusion of the Democratic Labour Party.

Senator DITTMER:

– I never agreed to it.

Senator Gair:

– We were excluded from any agreement.

Senator DITTMER:

– Speak to the Government about it. Do not speak to me or my Party about it.

Senator Gair:

– But someone on your side of the chamber agreed to it.

Senator DITTMER:

– Do not speak to me. Do not speak about my Party. The Government is in control of the chamber.

Senator Gair:

– I did not know you had a Party.

Senator DITTMER:

– You will learn. You learnt in Dawson. You were not game to put up a candidate in Dawson, and the Government’s candidate got the hiding he deserved. That is a token of what is going to happen elsewhere, we hope. Before I was interrupted, I was dealing with the quarantee given to those who make advances for the purchase or erection of homes. I make bold to say that that legislation has made no contribution at all to the acquisition of homes by people who need them. Money for housing finance is just not available, because the return on it is not adequate. The banks are institutions which come within the ambit of that legislation. However, let us be reasonable. The bigger the deposit they get, the greater is the number of customers or clients they can accommodate. They are anxious to please as many people as possible and to have as many customers as possible. The position of the insurance companies is somewhat similar. Consequently, the legislation has made no substantial contribution to an alleviation of the shortage for homes. The Minister can get up and tell us the exact number of bodies or institutions that the Government has authorised under ministerial approval which are entitled to the protection of this guarantee against loss. But anyone with a practical approach to this problem and knowing these particular institutions knows that they are not worried about the guarantee. They take the people who are acceptable to them as a risk. They will make loans available to the greatest number of people that they can accept because it increases their goodwill and broadens the number of their clients or customers.

The amendment which was moved by Senator Cavanagh was a simple one. There was nothing outrageous about it. It has been put up before, but it is being put up again for the particular reason that on this occasion we thought we had a Minister who was sympathetic to the needs of the ordinary people - those who are most in need of help, such as young married people, people which large families and older people. Kowing the Minister’s persuasiveness, we thought that she might be able to persuade the new Prime Minister (Mr. Harold Holt) and his Cabinet as to the desirability of this inquiry. There would be nothing wrong in a select committee of the Senate inquiring into the needs of housing. We need not go along with the Government and accept the needs ofthe industry concerned and those involved in it - the builders or the employees.

Let us think in terms of whatthis miserable grant of$15 million will mean. It is very difficult, in any capital city or anywhere else, to purchase a home of 10 squares or over and land under $10,000. If we allow$10,000 for the purchase of a home, it means that the grant will provide for 1,500 homes. It will go nowhere in meeting the need of the 70,000, 80,000 or 90,000 homes that are required. The grant makes no provision for the elimination of slums. One could not purchase a home for much less than $10,000. In most cases the price is substantially higher. It means that the grant will provide a maximum of 2,000 homes within the boundaries of Australia. It will mean less than 300 homes in Queensland, which would not go anywhere towards meeting the need. All that Senator Cavanagh asks for in his amendment is that a select committee be appointed. If it is found that we are wrong in our contention, we will accept the condemnation, but there will be no condemnation because we know that we are substantially in the right.

When Senator Cavanagh was speaking I heard one honorable senator opposite interject - I think it was Senator Prowse, the distinguished senator from Western Australia - and say: “What authority has the honorable senator got as regards the question of slum clearance? “ I see that Senator Prowse nods to indicate I am correct. I am never wrong. What authority do we have for moving into the field of education? We have every authority for doing so under section 96 of the Constitution, provided we lay down the conditions. Surely this Government, which is in control of the finances of this country and which makes the State Governments by and large today, the spenders of the money that it farms out to them, has every authority to deal with slum clearances, just as it has every authority to deal with education, not only at the tertiary and secondary levels, but also at the primary level. We have every authority to go into the field of housing and slum clearances.

I know that I have broken a promise that I made to the Opposition Whip that I would not speak at any great length, but I have done so because of the harness that has been placed on me by the Government in an attempt to limit this debate. If the Minister had to leave, I think that consideration of this measure could have been postponed. Surely this is an important social question. Certainly the Government must have a sense of responsibility as to the needs of the people. It must certainly realise that it has not met the housing needs of the people. It has not taken men, women and children out of the slum conditions in which they live. I am not saying that the Minister for Housing, of her own desire, wishes to push the legislation through the Senate. It is probably a Government decision. The Government wants the matter off its plate as quickly as possible because the longer the debate continues, the more deficiencies will appear in the actions, not only of the present Government, but of its predecessors.

I commend the amendment to the Government, particularly that part relating to the appointment of a select committee. I say to the Minister for Housing, the distinguished Senator from Queensland, that if she really wants to make a name for herself - I know that she is popular in Queensland and that she receives a great percentage of the women’s votes - she should accede to the request of the Opposition. She is of a serious turn of mind and I suggest that she is concerned with the rights of the people. I have always thought up to now - although I will judge her in the future by her actions - that she has spoken sincerely. She now has an opportunity to make a name for herself by suggesting to her Government that it should take a really vital, sincere and sufficient interest in the housing question and ensures that people who have from $400 to $1,000 shall be able to obtain a suitable home in a suitable location, not necessarily in an aristocratic or snobbish area, but in an area which has the facilities to accommodate their family adequately. [ believe that this need can be met, not by accepting the amendments that have been moved in past years, but by accepting this amendment which provides for the appointment of a select committee of the Senate. The committee would have power to call on all sections of the industry - those who provide materials, those who utilise materials and those who work in the industry. Then we would find the reason why people are denied houses. It is not necessarily because the cost of building or of land has increased. Everything associated with housing has gone up disproportionately in relation to the other costs of living. We think that a select committee might be able to find the mechanism to provide every decent Australian couple, young or old, with adequate accommodation. That is something which they need and to which they are entitled in an affluent society, of which the Government has boasted so often but towards which it has contributed very little.

Senator MCMANUS:

.- The Australian Democratic Labour Party will support this Bill. The measure does not do everything that we would wish for housing but it is definitely a shot in the arm for an industry which has been to some degree under a cloud. The Democratic Labour Party will not support the amendment. We agree with its opening words, that the existing housing agreement has not fully met the housing requirements of the Australian people, and we also agree that the points mentioned concerning rental rebates, slum clearance, housing for pensioners, land development and town planning are important matters.

We feel, however, that it is entirely unrealistic to suggest, as the amendment does, that the Government should be precluded from entering into a . new agreement to which part of the money to be provided by this Bill may be applied, until a select committee of the Senate has investigated all of those matters. No time limit has been fixed, and we would not be prepared to support such a curb upon the wishes of the Government to take action in regard to housing. For that reason, therefore, Senator Gair and I will vote against the amendment and will support the Bill. While some of these matters are of extreme importance, we think that any political party worth the name would have investigated them over the last 10 years and have formed its own conclusions and policies on them. We feel, furthermore, than an inquiry with such a wide scope would inevitably lead to resentment by the States who would regard us as intruding on important matters of State rights.

We of the Democratic Labour Party are pleased that the Government has taken action in regard to housing because as a party we raised last year the serious position in regard to housing and pointed out that home building is probably one of the most vital industries in the community. When home building flags we are on the way to depression because there are so many other industries, such as the furniture industry, the electrical industry and the plumbing industry, which depend on home building. Therefore, when home building is not being carried on at a satisfactory level there is a risk of recession and later of depression. That was shown by the significant rise in unemployment at the time when home building was flagging. We are glad that the Government has taken action, as we urged at that time and as other people also urged, to give home building a shot in the arm.

The Treasurer (Mr. McMahon) has said that he feels that the present situation is satisfactory and will show improvement. In referring to the measure now before the Senate, he said -

Taking this $15 million with the addition of $24 million of savings bank money in the current half year, it is plain that the level of dwelling construction is now being strongly stimulated. The $15 million of additional expenditure will mainly be concentrated in the three months between now and the end of 1965-66.

Actually, before the Government took action there was something of an improvement in the situation. The action that is now being taken will ensure that there is no slipping back. If it is supported by further action by the Government we can look forward to a reasonable degree of home building in the near future. There are, however, two criticisms that I want to make. The first is that under our present bousing policy not enough is being done for the small home builder, the person who wants to build a very moderately priced home. The tendency is for finance to go to the person who wants the more expensive type of home. Secondly, at the present time the tendency is against the interests of the co-operative housing organisations.

I have a lot of time for the co-operative housing bodies. 1 think that co-operative housing organisations will build more houses relative to the amount of money made available to them than will governmental institutions. They embody the principle of self help, of which I am very much in favour, but I think that anybody who considers the housing situation must agree that there is serious cause for dissatisfaction among the co-operative housing bodies which have made such a strong contribution to housing in this country. Let me quote the words of Mr. L. V. Mitchell, the Secretary of the Federation of Co-operative Housing Societies of Victoria. He said only recently -

Housing co-operative societies are being so starved of funds in the State of Victoria that a serious crisis in the future administration of the movement seems inevitable.

He pointed out that the volume of finance available from May to October of 1965 was down by nearly 50 per cent, in comparison with the corresponding figure in 1964. Let me go on to quote from his report to the Federation, because 1 think it is important. He said -

Keen disappointment is expressed by housing society officers at the lack of support coming from the banks, insurance companies and other private organisations over the years. The record shows that, although the number of societies has increased from 283 in 19S6 to 906 at the present time, the amount of finance secured from these institutions has remained almost stationary.

In the year 1960-61, £3.8 mil. was supplied by these sources. The figure in 1964-6S was only £4.1 mil.

The State Government-operated “ Home Builders’ Fund “ and the Commonwealth Bank have endeavoured to maintain a comparable lending level, but it is evident that a great deal more is required if the housing societies are to cater, as they have been doing so well in the past, for the needs of homebuilders in the lower and middle income groups.

I stress the words “ in the lower and middle income groups “. Now let us consider the effect of this situation on decentralisation, something to which everybody pays lip service but for which far too little is done in this country.

The Latrobe Valley in Victoria is an area where there is intense industrial development. It is also an area where there is an increasing need for housing. But what is the opinion of the Decentralist Co-operative Housing Societies in the Latrobe Valley? Their Secretary, Mr. J. Moore, had this to say recently -

There are literally hundreds of yoting people in the Latrobe Valley whose home building savings are being seriously reduced by stiff rents because of the lack of housing finance at the present time.

The Housing Societies Federation has made approaches to the Reserve Bank in an endeavour to have more funds released to the co-operative housing movement. The State Government-

That is, the Government of Victoria - has been pressed to set up the machinery to bring about a restoration by the lending institutions of the comparative lending level of previous years. The tangible result to this point of time has been nil.

He added -

The immediate casualties are, of course, the young home builders on modest incomes. The secondary effect is the increased difficulties to the efficient administration of the individual societies. As the existing societies agc, their management funds decrease. This is brought about by the shrinkage of the society’s funds, due to progressive discharges of mortgages by the society’s members. Unless fresh finance becomes available to fill the gap, efficient full time administration is threatened by the lack of resources.

I take that comment very seriously because I regard the co-operative housing movement as one of the best movements in this country. The co-operative housing societies claim that despite the immense increase in the number of societies, indicating increased public demand and desire for their services, there has been very little increase in the funds that are available to them. I think that those statements require an answer. Now, of course, one answer may be: “ In additon to the earlier sum, you are getting $15 million for the purposes of housing throughout Australia.” I have approached some leading personalities in this organisation and asked their opinions. They tell me that they are very disappointed indeed with the allocation of this money. This is a statement which I have received -

We were pleased to receive notification in midMarch of the allocation of $15 million for the purposes of housing throughout Australia. Whilst this is not a large amount of -money, we appreciate the efforts of the Government to stimulate home building activity.

But they go on to say -

The distribution of this money is as follows: 70 per cent. ($2,678,200) has been reserved for the use of the Victorian Housing Commission; only 30 per cent. ($1,147,800) has been channelled through co-operative societies. Furthermore, 30th June has been nominated as the date by which all moneys must be expended by co-operative housing societies. This is contrary to the wish that we expressed in communications with the State authorities. Our recommendation made at that time was based on the findings of a research committee, which showed that the low priced sector of the housing industry (that is, homes under $6,000) has fallen from 28 per cent, of the total homes built in 1960 to under 5 per cent, in 1965.

This is a most serious matter. I should have thought that in home building we would be trying to do what we could for the lower paid people, yet in Victoria we have the finding of a research committee that the low priced sector, relating to homes costing under $6,000, has fallen from 28 per cent, of the total number built in 1960 to under 5 per cent, in 1965. The letter goes on - lt is our considered opinion that the injection df this money . . .

That is, from the $15 million - will have little effect on the sector of the housing industry which most requires stimulus, that is, housing for the low income earner. The short time allowed for dispersion of this money will mean that it can only be used to finance existing properties in the middle price range.

That is a reference to the fact that it is insisted that this be dealt with by 30th June. It is pointed out that while no doubt the object was to push building along at a rapid rate this will have a bad effect on the low income earner.

Senator Webster:

– There is an inconsistency in relation to the comment about the £3,000 home. The general demand by the community today is for a higher priced home and perhaps more luxurious fittings, which must be taken into account when looking at the drop from 28 per cent, to 5 per cent. It is not just a case of finance being not available.

Senator McMANUS:

– That may be so, but the fact remains that a drop from 28 per cent, to 5 per cent, could not be accounted for just by that factor. I think that everybody who talks to those dedicated people who are trying to do something to enable the low wage earner to build a home will be told that the present system is tending against the man who wants to build a home at a lower price in favour of people who want to build moderately priced or even higher priced homes. I think anybody associated with housing would come to the conclusion that this is a matter that must be looked at and a matter that needs attention.

I want to conclude by referring to just one point, which has something to do with the matter mentioned by Senator Webster. There is a steady increase in the average amount of loans required, which reduces the numbers able to obtain loans unless the total amount of money available is increased. I want to quote from a statement which has been issued by the Housing Industry Research Committee. It reads -

A second point that should be carefully considered is that the average loan is increasing and, therefore, if current levels of finance measured in £ s. d. are maintained . . .

That is, if we do not increase the amount for housing but just maintain it as it is, and the tendency has been for no very big increase -

  1. . the number of loans will automatically fall. As an illustration of this, the average value of loans approved for new housing by savings and trading banks and life offices has increased from £3,200 in June quarter of 1964 to £3,299 in June quarter of 1965. If this trend continues, as seems probable with the price of land and the average value of houses increasing, an average loan would be about £3,400 in the June quarter of next year. Applying this to savings bank lending, the number of homes that could be built for the same amount of money would fall by about 3 per cent.

Those statements do not come from people with an interest of their own. They come, I believe, from dedicated people, who want to do all that they can to assist the housing needs of the community. I trust that they will be examined by the Government and by those who lead our financial institutions. I trust that these authorities will regard the prospect of a reduction in the number of persons to whom loans are being made available as a serious matter, and I trust that they will be able to offer us even more than they are offering at the present time - and I welcome this - for the very good purpose of housing in the remaining part of this year. I therefore conclude by saying that my party - Senator Gair and I - will support the Bill and that we are unable to support the amendment.

Senator BREEN:

.- I rise to support the Bill with very great pleasure indeed, more particularly because it is the first bill presented by the new Minister for Housing (Senator Dame Annabelle Rankin). Dame Annabelle’s appointment to this portfolio was greeted throughout Australia with very great pleasure indeed and, may I say, more particularly by the women with whom she worked in her own State of Queensland and all of the associated women’s organisations in other States, members of which have followed her splendid career throughout the years. It has given very great gratification to those women and, I would add, to a great number of men in the Commonwealth of Australia, that Dame Annabelle Rankin has undertaken this important work of housing.

I support with great pleasure the Bill, the purpose of which is to authorise the raising of loan moneys totalling $15 million, to be expended during this last half of the 1.965-66 financial year. The amount, of course, is advanced under the 1956-61 Commonwealth and State Housing Agreement and is in addition to the $102 million already allocated for 1965-66. During the preceding year, 1964-65, the number of new dwellings reached an extremely high level. One hundred and seventeen thousand houses and flats were commenced, but, unfortunately, from July to November 1965 the number of new dwellings approved for building declined. There was a great amount of other building during that period and employment of labour reached a very high level. It is interesting to note that in the last three years employment in the building industry has increased by 20 per cent. Nevertheless, it has been realised that more dwellings must be commenced to meet the growing housing needs.

Contributing to this growth is the most welcome factor that the 1965-66 migration programme represents an increase of 3i per cent, over that of 1964-65. Moreover, with our growing population an increasing number of young people are arriving at a marriageable age. Newcomers to our shores look forward to owning or having their own homes when they arrive here. Young people who are looking forward to marriage have that same keen desire. With the rising standard of living people are not content to live in the smaller or dilapidated homes to which they were accustomed in the past The 1961 census disclosed that quite an alarming number of dwellings could be described as being sheds, but we have progressed considerably since then.

The growing needs and the declining figures have been kept under close scrutiny. The former Minister for Housing, the Honorable Leslie Bury, was in constant consultation with the Governor of the Reserve Bank, the Treasurer, the savings banks, the State housing authorities and the private home builders. The present Minister, Dame Annabelle Rankin, said in February, when speaking of the number of dwellings that had been approved in January, that the figures called for “early deep consideration “. I remind honorable senators of the Minister’s first statement when she described a house as being a home and the heart of family life in Australia. This clearly indicates that the Minister does not regard the housing problem as being one of statistics and figures but as one of homes for the people. It is with that approach that the Minister is administering this portfolio. Support for this attitude was evinced by the Prime Minister (Mr. Harold Holt) when he referred to the housing situation in the statement that he made to the Parliament on 8th March. He said that in the second half of 1965-66 a substantially additional sum, estimated to be $24 million, was being provided by the savings banks for housing and that the Government was considering other measures to support the housing programme. The next step was the offer to the State Governments of the increase that is the subject of this Bill. The concern of the Government and the practical measures of which I have spoken indicate the Government’s appreciation of the importance of home building since it assumed office in 1949. Quite obviously such an appreciation refutes the suggestion made in the Opposition’s amendment that a select committee of the Senate should be established to deal with the subject of housing.

When we speak of the decline in the figures and the growing needs, we should realise that more than 75 per cent, of the occupied private homes in Australia are occupied by people who either own them or are purchasing them on instalments. This proportion of home ownership is believed to be one of the highest in the world. We can take great pride in this fact. Surely this proves that the whole subject of housing can be safely left in the hands of the Government. The homes savings grants scheme and the housing loans insurance scheme were designed by the Government to encourage and to assist the people of Australia to obtain their own homes. Moreover, extensive assistance has been given under the Commonwealth and Slate Housing Agreement to people on low and moderate incomes to enable them to buy their own homes. As has been stated, under the current agreement 30 per cent, of the total loan funds advanced to each State must be allocated to a home builders account and 70 per cent, is retained by the State housing authorities.

In my opinion, rental rebates, slum clearance, housing for pensioners, land development and town planning, which have been mentioned in the Opposition’s amendment, should certainly be left in the hands of the State housing authorities. My own State of Victoria is dealing wilh these matters most adequately. Victoria’s share of the advance of $15 million will be $3,826,000. The need in Victoria is very real. The twenty seventh annual report of the Victorian Housing Commission for 1964-65 states that the demand for accommodation is increasing and that as at 30th June 1965 applications outstanding totalled 13.778, 10.479 being in the metropolitan area and 3,299 in country areas. With the growth of the population, the demand is still increasing and it is estimated that to cope with the overall requirements 40,000 new houses a year are needed. I understand that, having regard to the number of unoccupied houses and the transfer of people from one area to another, it is very difficult indeed to arrive at a definite figure. The report further states that it is the particular concern of the Housing Commission that, whatever is the level of dwellings completed over the whole State, an adequate proportion must be made available to that section of the community which is not able to finance its own building costs on the terms offering on the open market. A large part of the need is for rental accommodation. The deficiency in the availability of low price homes is constantly stated in research reports.

In regard to the subject of rentals, the report of the Housing Commission states that of the 33,541 weekly tenancies that existed at the time the report was completed 4,816 occupants were on a rebated rent because they were unable to pay the comparatively low rents that were charged by the Housing Commission. The total amount of rebated rents for the year 1964- 65 was £438,102. This is a figure, but it represents people for whom we must all have a great concern. I refer to the elderly pensioners, the widows, the deserted wives and families in the low income range. There are still many families who are in receipt of a weekly income of £18 to £20 a week. On 16th March I read a report that approximately 11,000 applications for family accommodation were held by the Housing Commission. 1 turn now to slum reclamation. The same report of the Housing Commission to which I have referred shows that in Victoria at 30th June 1965 a total of almost £23 million had been spent on the acquisition and redevelopment of slum areas. The year 1965-66 is the second year of the greatly enlarged slum clearance programme. I have seen some of these areas both before clearance of the slums and since they have been redeveloped. People have commenced to live in them in great comfort. Naturally these big housing settlements bring some problems in their train, but these are receiving the attention, not only of the housing authorities, but also of the social welfare departments.

At the request of the Housing Commission, many municipal councils have made available land for the building of low rental accommodation. In the metropolitan area, 35 acres has been made available, and 15 acres in the country. The interest of the municipal councils has been greatly stimulated by the Old Peoples’ Welfare Councils to which a grant was recently made. It was much appreciated by all those persons who support the work of that splendid organisation. Lone person units are being constructed. During 1964-65, three 12 storey blocks were commenced, each block containing accommodation for 200 single persons. Early this month I read that 16 low rental brick veneer home units will be built in Mornington at a cost of $63,000.

Since the inception of the scheme, the total number of houses for single pensioners and pensioner married couples - Darby and Joan units - is 4,090. This figure, of course, was stated in March 1965 in the report. Since then the position in Victoria for the housing of elderly people has reached a very grave stage. I was interested to read in another report that the census of 1961 showed that the number of people living over the age of 65 years has increased quite considerably. The census of 1921 showed that the percentage of people of 65 years and over living at that time was 4.43; in 1961 it was 8.51. We are all extremely thankful that help is being given to house aged people under the Aged Persons Homes Act.

It appears that 18 months ago the proportion of low cost houses in the total number of homes built in Victoria was 28 per cent. Now the proportion is only 6 per cent. The supply is diminishing because would-be purchasers are finding difficulty in obtaining finance. We must speak with very great appreciation of the splendid contribution being made by co-operative housing societies. I wish to quote from the “ Hansard “ report of the Victorian Legislative Assembly of 2nd March 1966. The Minister for State Development is reported as having said -

There are now 889 societies, with an aggregate membership of 48,756, including 257 societies financed from the Home Builders’ Account under the Commonwealth and State Housing Agreement. Lending institutions - that is banks, insurance companies and other organisations - have made available to 632 societies an aggregate amount of $173,015,000, while societies financed from the Home Builders’ Account have been provided with an amount of $81,219,400, including $14,553,200 from the revolving nature of the account. At the 31st December last, 54,019 members had obtained homes, while there were a further 2,400 homes in the course of erection.

That is a most important contribution to the housing of people on low and moderate incomes. I again remind honorable senators of the very real contribution that is being made under the homes savings grant scheme. In the Minister’s statement in February she said that the total amount granted under the scheme had reached the splendid figure of $21 million. Grants have been made to 46,000 couples, 73 per cent, of whom have received the maximum grant of $500. A scheme which is enabling more and more money to be lent to people entitled to buy their homes is the housing loans insurance scheme. In the statement of 3rd March it is said that the Housing Loans Insurance Corporation was doing business at the rate of $1 million a month. It is gratifying to know that on 3rd April regulations were made which will enable the Housing Loans Insurance Corporation to insure a far wider variety of housing loans. I was particularly interested in the second paragraph of the statement which stated the variety of loans to be insured. It included loans to add a self contained living unit to a home or to build it separately on the land.

Organisations with which I work in Victoria have urged for a considerable time that where there is sufficient land permission should be granted to build an annexe or separate small dwelling for the accommodation of the elderly parents on a block of land on which a husband and wife have a dwelling. I hope that under the regulations that practice will be carried out in a number of cases. Undoubtedly it is true that elderly people are very much happier if they are able to stay with the family than they are if housed away from them, even in the excellent home units to which I referred earlier. It seems apparent that loans may be insured to enable older homes to be purchased. I have heard many young people express the desire to build or convert a larger home for the use of themselves and their parents, or of two families. It seems possible that under the new regulations that practice will be brought about.

The practical steps taken by the Government to stimulate the home building industry will be clearly seen as time goes by. It was heartening to read on 30th March last that the report of the Commonwealth Statistician showed that housing loans increased by $9.7 million in February as compared with $3.1 million in January. Stimulation of the home building industry results in increased activity in many allied industries. I refer, for example, to the furniture, textile and electrical goods manufacturing industries, in fact, to the manufacture of the whole range of household goods. The building of homes makes an important contribution to the economy of Australia and to the greater happiness of its people. Many facts and figures indicate the happiness that can be obtained by the provision of homes for families, thus ensuring a very much better future for the children living within those homes. It is with very great pleasure that I support this Bill and I oppose the amendment proposed by the Opposition.

Minister for Housing · Queensland · LP

[3.43]. - in reply - I wish to express to all honorable senators who have spoken in this debate my deep appreciation of their interesting and considered speeches. They have expressed a variety of opinions and knowledge of a great number of aspects of housing. I appreciate very much what they have done to make it a very interesting debate. 1 also wish to thank them for their support of the Bill.

Now I turn to the particular points which have been made by the Opposition. As honorable senators will recall, the Opposition has proposed an amendment to this Bill. I think it should be given some consideration. The proposed amendment seeks to do two things. First, it proposes that the Senate accept that the existing Housing Agreement has not fully met the housing requirements of the Australian people. To me, this suggests that the Opposition is ignorant of the purposes of the Agreement. The Commonwealth/ State Housing Agreement was never intended to solve all of Australia’s housing problems. It was designed to meet particular housing needs especially those of families on low incomes including aged pensioners. It is quite unmeaningful, therefore, to claim that the Agreement has not solved all our housing problems. The second purpose of the amendment is to propose that before a new agreement is entered into an all-party committee be appointed to investigate all aspects of the Agreement as well as certain other matters.

I assure honorable senators that the Government has a clearly defined housing policy which I believe has been most successful. Not only has our policy resulted in a record number of homes being built but it has also paid great heed to the housing needs of families and others on low incomes. Should honorable senators opposite be unaware of some of the things we are doing in this field, let me remind them that the Commonwealth makes advances to the

States under the Housing Agreement at a rate of interest 1 per cent, below the long term bond rate - truly a concessional rate - to enable the States to build homes for sale at lower than market prices and with the assistance of long term loans on very favorable terms and conditions, or for letting at lower than market rentals to people on low incomes, including aged pensioners. These are important things of which we should remind ourselves. Our interest concession has also enabled the States to offer dwelling accommodation at .lower than economic rentals to families and pensioners who cannot afford to pay the full economic rental. Reference has been made to slum clearance. The States may also use our advances under the Agreement to meet the full cost of construction of blocks of modern flats on areas which have been cleared of slums. This, too, is recognised as being of great importance.

Quite apart from the Agreement, very considerable assistance is being extended by the Commonwealth in the housing of elderly persons. This Government has introduced the Aged Persons Homes Act. Since its commencement in December 1964 grants amounting to more than $54 million have been approved, and when all the approved building projects are completed approved accommodation will have been provided for 22,000 aged persons. This is recognised by all honorable senators as a field in which very great assistance is being given.

In the proposed amendment and in the speeches of Opposition senators reference has been made to slum clearance, the redevelopment and the cost of land and so on. It may interest honorable senators to know that I have asked my Department to undertake a comprehensive study of slum clearance and urban redevelopment schemes in a number of countries. Different methods of financing the development of land for new residential purposes are also being investigated by my officers. We cannot turn a blind eye to the facts that more than one-half of our population lives in a very few cities and that by the turn of the century the populations of our capital cities will have roughly doubled. I take pride in the fact that this Government is considering all these wider problems associated with the way in which our people will wish to be housed in the years that lie ahead. They are important problems and we are approaching them with a very real feeling of responsibility.

We do not regard housing as a residual factor that can reasonably be allowed to fluctuate as the play of economic forces dictates although some degree of fluctuation is inevitable. We regard the housing of the people as a great social responsibility and this largely determines our actions. We wish to see the level of housing rise at a steady rate as needs increase. At the same time we seek to avoid a situation in which the prospective level of housing activity is higher than available labour and other resources can sustain. Undue pressures on resources would serve only to increase housing costs, and we wish to see our people obtain satisfactory dwellings at the most moderate prices. These are the things which my Department and this Government are very concerned about and which we approach with a deep sense of responsibility.

The Government, by this Bill, indicates a two-fold purpose of giving an appropriate stimulus to home construction activity, and of increasing the supply of moderately priced dwellings for persons on lower incomes. After a great deal of consideration we reached the conclusion that the housing needs of families in the lower income group were not being adequately met and that the stimulus to home building provided by the additional $24 million that the savings banks are lending for housing was likely to leave some slack in cottage building in the States. Therefore, as this Bill indicates, we are taking additional action under the Housing Agreement by making a supplementary advance of $15 million to the States. This Bill and the action we are taking will play a tremendous part in meeting the need for homes.

The major portion of these additional moneys will go to the housing authorities which, as all honorable senators know and as they indicated in their speeches, are faced with increasing demands from young families and migrants to rent or buy a home on terms and conditions that they can manage within their incomes. Some of the additional moneys will also go to building and housing societies to be advanced to people who look to these societies for finance on reasonable terms to buy or build their own homes.

As we have heard in this chamber and elsewhere, there are those who advocate that there should be government planning of the number of houses to be built each year in Australia. I wish to emphasise that the Government regards the development of residential land and the planning of dwelling construction as essentially a private enterprise activity. More than 80 per cent, of the dwellings built each year in this country are built by private enterprise, and I feel sure the majority of Australians would wish private enterprise to continue to design and build the homes they own and in which they live.

Of course, we also recognise the great importance of the Commonwealth/ State Housing Agreement. I remind honorable senators that we are not now debating a new housing agreement. The Bill before us seeks authority for the Treasurer to borrow $15 million to be applied for housing purposes. This allocation will supplement loan money of $102 million already allocated to the States for the financial year 1965-66 under the existing Housing Agreement. Shortly I shall be introducing legislation to authorise a new housing agreement to take effect from 1st July 1966. When this legislation is introduced in the near future, honorable senators will have an opportunity to engage in a full debate on the various aspects of Commonwealth assistance to the States for housing.

The assistance that the Government is providing under the terms of this Bill amounting to $15 million will be of great help to the people in all States. It will make a great many homes available. I appreciate the manner in which honorable senators have accepted the Bill and inform the Senate that the Government opposes the amendment.

Question put -

That the words proposed to be added (Senator Cavanagh’s amendment) be added.

The Senate divided. (The President - Senator Sir Alister McMullin.)

AYES: 22

NOES: 27

Majority . . . . 5



Question so resolved in the negative.

Original question resolved in the affirmative.

Bill read a second time.

In Committee.

The Bill.

Senator WRIGHT:

.- I did not intervene in the second reading debate except for one or two isolated, pertinent interjections. One of these brought a reply from Senator Cavanagh which leads me to rise in order to put the record straight. The housing commission which reported to the Labour Government at its instance in 1944 considered the question of nationalisation as affecting housing and it had this to say at paragraph 307 of its report -

In considering the matter it is useful to record that the Uthwatt Committee (the most recent English authority to comment on this subject) considers that land nationalisation is the only adequate method of preserving for the people as a whole any increase in land values, and of removing some of the difficulties of compensation for resumption of land; but that Committee rejects nationalisation as a practical measure . . .

The report then quotes the terms of rejection. The Housing Commission which reported to the Labour Government in 1944 went on in paragraph 308 to express this view -

This Commission is also of the opinion that the only satisfactory method of dealing with the problems of land use and land values is forland to be nationalised, and held thereafter as leasehold;

That is, perpetual leasehold. The commission went on to debate this recommendation which should be remembered by everyone. It is imprinted indelibly on my mind -

Second: the size of the financial operations required should not daunt those used to wartime finance;

They were then referring to an objection that the English committee had found to the project of nationalisation as a practical measure. The Australian commission, appointed by the Labour Government, went on to say -

There would, of course, be considerable public opposition to land nationalisation, both from existing landowners and from many who would fear that such may be a prelude to other similar measures;

That is very interesting in retrospect, because 1944 was indicating the shadows of 1949. The passage continued - but it seems to us that land nationalisation is the only effective way to eliminate private profit making from land and to reserve to the community the unearned increment.

It seemed to me to be desirable that we should remind ourselves of the thinking that then prevailed in the minds of the members of the Commission. That is one of the most cogent reasons why I refuse to agree to a select committee of the scope sought by Senator Cavanagh.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

Bill (on motion by Senator Dame Annabclle Rankin) read a third time.

page 501


Ministerial Statement

Debate resumed from 17th August (vide page 9), on motion by Senator Henty -

That the Senate take note of the following paper -

New Zealand-Australia Free Trade Agreement - Ministerial Statement, 17th August 1965.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The Senate now has before it the New Zealand-Australia Free Trade Agreement, which was tabled in this chamber on 17th August last. We have before us, by way of formal motion -

That the Senate take note of the paper.

As an amendment to that, I move -

That the following words be added to the motion - “ but the Senate is of opinion that the Agreement will be detrimental to the interests of Australian primary producers “.

I would like to indicate at the outset that the generality of those words does not adequately express the outlook of the Opposition on the Agreement. The words were used in another place, and I adopt them, but I wish to indicate at this stage that our objection to the Agreement as presented is rather to the inclusion of certain items, in particular, frozen beans and peas, cheese and pigmeats. Only in relation to those four items have we very substantial objections. That explanation may tend to narrow the scope of the debate that might flow from the quite wide terms of the amendment I have moved.

Senator Morris:

– Will the honorable senator again state the items to which he objects?

Senator McKENNA:

– Frozen beans and peas, cheese and pigmeats are the four items with which the Opposition is principally concerned. As has already been stated publicly, the Opposition will vote against the proposal to eliminate the existing tariffs on those four commodities. I understand that the Bill to validate these matters - the proposals already having been before another place - was presented elsewhere today, so that in the near future the Bill to give effect to the New ZealandAustralia Free Trade Agreement in the form of tariffs will be before us for consideration. At that stage we will try to eliminate all items in the proposals which seek to reduce or eliminate the existing tariff duties on imports of those items.

I feel that I should protest against the inordinate delay in allowing this debate to take place. As I have said, the Agreement was tabled on 17th August last. The Government has delayed the debate for eight months. This is an important Agreement, and it is not right that there should have been such a very long delay. My next lament is that this important Agreement was concluded at the executive level. The Government of this country, with the Government of New Zealand, signed the Agreement and ratified it on 2nd December last, bringing it into operation on 1st January of this year. It was within the constitutional competence of the Government to conclude the Agreement without reference to the Parliament. On the day upon which the Agreement was tentatively reached, 17th August, it was filed here and we were told about it. The Parliament was then sitting and continued to sit for months - throughout August, September, October, November and, I think, part of December. There was no difficulty about the Agreement being presented to the Parliament for ratification, but the Government, having floated the document before us “n 17th August, did not ratify it until 2nd December, although it had opportunity throughout the whole of the period between those two dates to officially seek ratification from the Parliament. I record a protest against that procedure.

I would like next to congratulate those who have been concerned with the preparation and the drafting of the document before us. It was a colossal task to select the many hundreds of items included in the schedule to which the Agreement gives immediate effect. I can imagine the vast amount of research and consideration that went into determining the list alone, and I express my admiration of the draftsmanship which is apparent in the document. The draftsman has been able to say explicitly what he wanted to say and has carefully refrained from saying anything that he did not intend to say. However, there is one aspect that I will mention. There are various safeguards in the Agreement. It is provided that in certain circumstances that might cause distress to either of the member countries - New Zealand or Australia - remedial action can be taken. I will mention some of the terms used. They are “Where some action is seriously detrimental to an industry “-

Senator Morris:

– From what provision is the honorable senator quoting?

Senator McKENNA:

– From article 3, paragraph 3. I will deal with that in particular later; I am now merely drawing attention to the variety of terms that are used. Also in article 3, paragraph 3 appear the words: “ contrary to the national interest “; and in paragraph 5 of the same article there are the words “ seriously detrimental to an industry “, and “ material injury “. In article 5, paragraph 3, there are the words “ seriously prejudicial “, and in paragraph 4 “ interfering unduly “. Article 7, paragraph 1 (a) contains the words “ causes or threatens to cause extreme injury to “ and “ adversely affects “. In the same article, paragraph (a) (ii) contains the words “ prices … are unduly low “. The words “ cause or threaten serious injury “ and “ future injury “ appear in article 9, paragraph 1, and paragraph 2 contains the words “ future injury “. Article 10, paragraph 2, contains the words “cause material injury “ and “ future injury “, and paragraph 4 (b) contains the words “ material injury “.

The terms are used in different contexts, but they are used in clauses which confer power upon one of the participating countries to take steps to protect itself.

Having paid a tribute to the draftsman, as I have done, 1 am quite sure that he had in mind exactly what he meant when he used each of those terms. But he has not gone further and provided any definition as to what constitutes material injury, serious injury or the thing that causes or threatens serious injury. I would certainly like the opportunity to discuss this Agreement at the Committee stage, lt seems to me to be most appropriate that we should speak, as it were, in the form of a second reading speech on the matter before us, but if the Senate is to give proper consideration to this very lengthy agreement we should resolve ourselves into Committee and consider each of these clauses or articles one by one. At that point we should be able to ask for explanations, and receive them, as to the shades of difference in meaning that the draftsman indicated by the use of the various phrases that, torn from their context, I have just put before the Senate.

The Agreement is a vastly important one. It affects the whole trade between the two countries. It is significant in furthering our good relations, because we build good relations by mutually advantageous trade. The Agreement will permit contacts between ourselves and New Zealand, and it will be a very useful addition to the friendship and the history of association in war and in peace that we have with our sister Dominion, for which we have a very great liking and very great sympathy. It is all to the good that we should be giving the lead in an endeavour to free the trade between our two countries. I speak in the broad sense when I say that.

It is interesting to note the degree of trade between the two countries. In 1965 we imported £23,268,000 worth of goods from New Zealand. I point out at once that the most important item in the list which makes up that total is our importation of pulp, paper and board, paper manufactures and stationery, which totalled £12,193,000, or more than half of New Zealand’s total exports to Australia. Against that £23.268 million that we took from New Zealand, we sold to that country in the same year £79,275,000 worth of goods. Again, more than half of the total was taken up under one main heading - “ metals, metal manufactures and machinery “, which totalled £40,436,000. In other words, slightly more than half of the total of our exports to New Zealand in that year consisted of manufactured items.

To bring the figures up to date, I ascertained from the Commonwealth Statistician the position at the end of February. I can indicate that our imports from New Zealand are running at almost an identical figure as the total imports for last year, that is, approximately £23 million, and if the trend is maintained in the four months from February our exports to New Zealand will show an increase of between £8 million or £9 million on the exports last year. It looks as though we will sell some £88 million worth of goods to New Zealand this year. New Zealand is Australia’s greatest market for the products of our secondary industries. Therefore, this Agreement is vastly important to Australia. There is a grave imbalance between the imports and exports between the two countries, which is very much to the disadvantage of New Zealand. That balance of payments position is one that unfortunately is chronically with New Zealand.

The Agreement itself was not one that we were free to enter into only by discussion and association with New Zealand. As we are bound by the provisions of the General Agreement on Tariffs and Trade we were obliged to refer the matter to that body. Part III of that Agreement, article XXIV, deals with customs unions and free trade areas. It provides, among many other things, that a free trade area is to be one in which duties are eliminated on substantially all the trade between the constituent territories in products originating in such territories. That means that when we take the total trade, that is, the imports and exports, the elimination of duties must take place in relation to the substantial part of that trade. I understand that the Government claims, and rightly so, that about 60 per cent, of the total trade between the two countries is subject to the clause providing for the elimination or reduction of tariff impositions.

The Agreement being subject to that provision, it is open to all parties of G.A.T.T. to demand that the contracting parties make changes. It is expressed that they may make “ recommendations “, but when one reads further one finds that the parties are forbidden to enter into the agreement unless the recommendations are accepted. One can see the rather mandatory nature of the articles or recommendations. Paragraph 10 of article XXIV of G.A.T.T. provides thai-

The contracting parties may by a two-thirds majority approve proposals which do not fully comply with the requirements . . .

It may be that this Agreement did not comply with all the requirements, one of which was that duties should be eliminated within a reasonable time. As the Senate no doubt knows, there are some items upon which the duty will not be eliminated for a period of nine years from the time this Agreement between Australia and New Zealand begins to operate.

I think that I can shorten what I have to say on this question by indicating that the Agreement went through G.A.T.T without opposition from the members of G.A.T.T., but also without enthusiasm from them. The condition was imposed that the parties to this Agreement should report early in 1968 and thereafter annually. The Agreement will be kept on the G.A.T.T. agenda until a free trade area is fully established. We can be assured that very close scrutiny will be paid by G.A.T.T. to our conduct in implementing the Agreement.

Senator Wright:

– From what point of view? How would G.A.T.T. be interested?

Senator McKENNA:

– Its interest is to see that a substantial part of the trade is set up in a reasonable time as being clear of duty; in short, that it is a free trade area. G.A.T.T. also will see how far we are progressing in carrying out the obligation under the Agreement to look at the other 40 per cent, of our trade and in trying to include it in the free trade area. I should imagine G.A.T.T. would be very critical if progress were not made in some substantial way in those circumstances.

I have indicated that I think the proper approach to a consideration of this matter is to deal with it in Committee. As that will not be possible, I think the best service I can render to the Senate is briefly to survey the provisions of the Agreement article by article. The survey may be inadequate, but at least it will present a picture of the whole Agreement. “ New Zealand “ means the metropolitan territory of New Zealand and excludes certain islands. “ Australia “ for the purposes of the Agreement covers the territory of the States and only the mainland territories of the Commonwealth. As the Agreement has been floated initially, it does not extend to the Territory of Papua and New Guinea.

One cannot quarrel with the objectives of the Member States as they are set out in Article 2. Those objectives are stated to be -

  1. to further the development of the Area and the use of the resources of the Area by promoting a sustained and mutually beneficial expansion of trade;
  2. to ensure as far as possible that trade within the Area takes place under conditions of fair competition; and
  3. to contribute to the harmonious development and expansion of world trade and to the progressive removal of barriers thereto.

One can applaud all of those aims. Article 3 determines the scope of the Agreement. In its first paragraph it makes particular clauses of the Agreement applicable to items and commodities of trade which are set out in a very lengthy schedule running into many hundreds of items. Some five articles wholly and one partially apply only to the goods that are listed in the schedule. We shall be dealing with each of those articles, and I hope to indicate which of them apply particularly to the items in the schedule.

The provision which interests me in Article 3 is that which states -

  1. . this Agreement applies to all goods traded within the Area.

It is plainly intended under this Agreement, therefore, that all commodities in trade between the two countries will presently come under the Agreement. Article 3 goes on to provide that there will be joint reviews with a view to bringing into the picture as soon as possible other items than those listed in the schedule. Those reviews are to take place annually.

In Article 4 we come to the highly operative piece of machinery in the Agree; ment. It is there expressed that, subject to the provisions of Articles 6, 7, 8 and 9 which deal respectively with revenue duties or taxes, deflection of trade, development of industry, and temporary suspension of obligations, and to which I shall advert in turn, each member is to reduce and eliminate in accordance with the provisions of the Article import duties on the goods in the schedule. The rates at which those reductions are to take place are set out in paragraph 2.

Goods which at the moment the Agreement comes into effect are free of import duties are to remain so. Goods subject to duties not exceeding 5 per cent, are to be completely free of import duties from the day on which the Agreement comes into effect. Therefore this Agreement will abolish all duties under 5 per cent, as from 1st January of this year. Where the duties were running at more than 5 per cent, but not exceeding 10 per cent., they are to be. abolished over a two year period. Thus, they are to be immediately cut in half, and then they are to be cut in half again two years later. Duties of more than 10 per cent, operative at the time the Agreement is made are to be abolished over a period of eight years. There is an immediate reduction of 20 per cent, followed by a 20 per cent, reduction each two years until eight years in all have elapsed. That will see the complete elimination of the duties.

I invite the attention of the Senate to paragraph 6 of Article 4. It provides; -

A Member State may reduce more rapidly or eliminate earlier than is provided in paragraph 2 of this Article any of the import duties referred to in that paragraph.

This means that the two governments may get together and reduce the eight year period, which is provided for in the Agreement, to a six year or four year period if they so agree. There is a companion provision in paragraph 7 which states -

The Member States may agree that import duties on any scheduled goods shall be reduced or eliminated over a longer period than is provided in paragraph 2 of this Article.

No advantage has yet been taken of the provisions of paragraph 6, but advantage has been taken of the provisions of paragraph 7 to extend, for instance, the time for the abolition of duties on frozen beans and peas from eight years to nine years. I point to the fact that some of the articles of the Agreement apply only to goods in Schedule A. Article 4, which I am now discussing, is one of those. I indicate that there are qualifications in that respect. The first qualification occurs in Article 5 which also applies only to goods in the schedule, except as is specifically stated.

In regard to quantitative import restrictions it is provided that Australia and New Zealand shall neither maintain nor introduce quantitative import restrictions on trade within the Area. They are not to say: “ We limit your right to import to a stated figure.” There are following provisions which permit the re-imposition of quantitative import restrictions if that is necessary to preserve our balance of payments position or if our international obligations in that regard are to be seriously prejudiced. There is an obligation to consult and to correct that position as soon as possible.

The next exception to the abolition of duties is to be found in Article 6 which relates to revenue duties or taxes. The Article provides that either Member may levy purely revenue duties on scheduled goods imported from ..the other Member but on the condition that the taxes are no higher than those levied upon goods produced within the taxing State.

Senator Wright:

– What sort of duties are referred to there?

Senator McKENNA:

– For instance, a Member may want to impose sales tax for purely revenue purposes. That would be the type of thing that would be in mind - not a tariff barrier. The tax would be not designed for that; it would be designed purely to raise revenue. Assuming the sales tax were imposed on an article we manufactured in Australia-

Senator Wright:

– I wondered whether it was an expression distinguishing between import duties which had a revenue purpose and import duties which had a protection purpose.

Senator McKENNA:

– It makes that distinction, 1 agree, that it has no protective purpose, if it is a revenue duty, a duty solely for the purpose of raising revenue. Article 6 says, in effect: “You may go ahead, as long as you do not make the rate any higher for us who are exporting to you than the rate that you impose on your own people producing similar goods “. Of course, if the tax that is imposed is a purely revenue one, there is no element of protection in that at all. The other exception to the run of the ordinary rate under Article 4 for the reduction and ultimate elimination of duties is in Article 7. This Article provides that if the import of any goods in the Schedule from the territory of the other Member causes or threatens to cause extreme injury to, and adversely affects the competitive position of, its producers of like or directly competitive goods, because the duties levied by the other Member State on raw materials imported from outside the area and used in the production of the goods are significantly lower than the duties or taxes levied by the first Member State on imports of similar raw materials imported from outside the Area, or the prices of raw materials used by one Member are unreasonably low as a result of dumping - there are some similar items of that type - the parties may confer and should take action to correct the position. In the absence of correction, the Member offended by the procedure may suspend the application of Articles 4 and 6. Article 4 is the one that requires the reduction and elimination of duties. Article 6 is the one dealing with revenue taxes.

Article 8 deals with the development of industry, lt provides that a Member State concerned with either the establishment of a new industry or the development of another industry may impose duty on particular items for that purpose. But the value of goods on which any such import duties are levied is not to exceed 10 per cent, of the total of scheduled goods imported. These duties, once levied, have to be reduced down a period of 12 years. Paragraph 3 of this Article provides that -

Iii exceptional circumstances and after consultations with the other Member State, a member State may, for the purpose of establishing new industries or of encouraging the expansion of established industries, withdraw items from Schedule A to this Agreement.

Senator Wright:

– Has anybody yet, in discussion of this Agreement, suggested to what industries that rticle might apply?

Senator McKENNA:

– No, I have not heard it. I do not know what is in mind. I should imagine that both have separate interests. Australia is largely developed as a secondary industrialist, New Zealand not nearly so. Its need for the establishment of secondary industry would, I think, be much greater than our need. In my thinking while on my feet, that provision is perhaps more for the protection of New Zealand than for the protection of Australia.

Senator Anderson:

– But, as a generality, it is a good thing to have in an agreement.

Senator McKENNA:

– Yes, it is a good thing to have. It is an obvious thing to have. It may well be that we may like and need to set up some new phase of primary industry.

Senator Wright:

– That seems to be indicated by the expression “ an extension of the range of commodities produced or manufactured by an existing industry “.

Senator McKENNA:

– That is right. I think it is in perfectly general terms. I cannot say that any particular industry would have been in mind. I should npt think so. I should think it would be an omnibus provision that would naturally go in at the instance of thoughtful officers and efficient draftsmen.

Article 9 applies also to goods listed in Schedule A. It provides for temporary suspension of obligations under Articles 4, 5 and 6 of the Agreement, where goods are coming into a territory of a Member in such increased quantities and under such conditions as to cause or threaten serious injury to its producers of like products. That particular State can request consultations, and an endeavour has to be made to avoid future injury. If no acceptable agreement is reached, then the Member offended may suspend the Article providing for reduction and elimination of duty, the one dealing with quantitative restrictions, and the one dealing with revenue taxes. But there is a penalty in relation to this matter. 1 refer the Senate to the last sentence in paragraph 2 of Article 9 which, a suspension having taken place, provides that -

In that event, the Member State whose exports are affected may, after giving notice to the other Member State, suspend, for an equivalent period, the application of all or any of the provisions of Articles 4, 5 and 6 of this Agreement to goods imported from the territory of the other Member State, the value of which is equal to the value of the goods affected by the measures taken by the other Member State pursuant to the provisions of this paragraph.

That is a very important clause. Where a Member State finds goods coming in in such quantities and conditions as to cause or threaten serious injury, it may take that suspensory action. It is not for the producers to determine whether activity is likely to cause or threaten serious injury. They may make representations, but it is their own government that will have to accept the position that injury is caused or threatened before any action may be taken under this provision. It may well take time to convince a government that injury has happened or is threatening. When that is done the government will negotiate with the other Member State, and those negotiations may run for 60 days. If no agreement is reached, the party offended may suspend the clauses providing for the reduction or the elimination of duty. But again the pressure comes back on that Member State, because the moment one Member State suspends to protect itself against the other, the other may immediately suspend the operation of items in the Schedule to the same value. It can take retaliatory action.

Senator Wright:

– And apparently make its own selection of articles.

Senator McKENNA:

– Not on the same articles - on any articles at all. So if the producers of a particular commodity in

Australia are affected and Australia takes steps under this clause to suspend the operation of those major provisions New Zealand may say: “ All right. To the same value of the trade affected by your action, we suspend on entirely different articles - things that we are importing from you.”

Senator Wright:

– And so a particular industry in Australia would have not only to convince the Government but also overcome the opposition of the prejudiced industry in Australia.

Senator McKENNA:

– That is the very point I am making. The retaliatory action might break out in a field which is not entirely new. That would represent very severe pressure on the Government and on the producers who were first affected. The other people who were affected would be on the side of the offending country. So we cannot take a great deal of solace from Article 9 and say: “Here is a highly protective clause that enables us to avoid serious injury “. These terms are not defined; no attempt is made to define them. I point out that it is very difficult to see the difference between the terms selected and the other terms that are applied throughout the Agreement. First, there has to be an injury either caused or threatened. Next, the Government has to be convinced of the matter. Then there has to be a delay of 60 days. Only then can the Government act. When the Government acts to suspend the agreement in relation to the offending commodities, it knows that it is going to get into trouble with the other nationals whose commodities are suspended by the opposite member. Looking at the matter in a hard practical way, whilst this seems to be a terrific power to have, it can cause a great deal of bother.

Senator Anderson:

– Is not the honorable senator assuming that, if there was a suspension by one party, automatically the other party would suspend? Why should it?

Senator McKENNA:

– If we are to pose a rhetorical question, I would ask: Why shouldn’t it? It is to its interest to get rid of the suspension against its products as soon as it can. It would be lacking in business acumen and I should think would be letting its own nationals down if it did not come back as hard as it could. I can recall a dispute between Tasmania and Victoria when we in Tasmania were told that we had corky scab in our potatoes. Under political direction, somebody found weavils in Victorian flour. There was a very smart, hard kick back. It may not have been well founded or authenticated, but the mere placing of an embargo on the importation of flour from Victoria was the quickest cure ever found for corky scab in Tasmanian potatoes. I indicate to the Minister that there is a kick back under this provision.

Senator Anderson:

– I do not dispute that. All I am saying is that in the spirit in which an agreement is entered into there is no predisposition to make difficulties.

Senator McKENNA:

– That is right. I should say that, if everybody is reasonable and it is acknowledged that an injury has occurred or is threatened and within 60 days it is rectified, nobody will be in any trouble. But in drawing such agreements one has to consider, not the probabilities, but the possibilities. This provision cannot be held up as a safeguard that enables one to jump clear of the Agreement. You cannot get one leg out without getting the other one caught.

Senator Prowse:

– Is not the honorable senator overlooking Article 16, which also covers this aspect of the matter?

Senator McKENNA:

– That deals with consultation and review. That goes on all the time. I am not overlooking that Article. The Article that we are considering provides for consultation, too, during a 60 day period. The suspension will take place only if the consultation does not end in rectification of the bother. The consultation referred to in Article 16 is a continuing general consultation to review all aspects of the Agreement.

I pass now from those Articles which apply only to the items that appear in the Schedule. I come now to Article 10, which deals with dumped and subsidised imports. The first provision is that a Member State is not to levy dumping or countervailing duties on imported goods. If, in the belief that goods are being dumped upon us, we have been hurt, we must consult. There is to be a period of 60 days during which neither Member State shall make direct inquiries concerning the matter in the territory of the other. I can only guess the purpose of such a provision. I hope that the Minister, when he replies, will indicate the purpose. All that may go on for 60 days, during which the dumping complained of might continue. Paragraph 3 of the Article provides that, if agreement is not reached within 60 days, the member offended may levy dumping or countervailing duties. The next provision - this applies not merely to the goods set out in the Schedule but to all trade between the two nations - deals with quantitative export restrictions. It provides that a Member State shall not impose new prohibitions or restrictions or intensify existing prohibitions or restrictions.

Article 12, which applies to all trade too, provides that a Member State may take steps to protect or prevent certain things. I shall mention a few. They include protection of essential security interests and public morals, prevention of disorder or crime, and protection of life or health and indigenous flora and fauna. Article 13 is a machinery provision. It provides that an area like Papua and New Guinea, for which we are responsible internationally, may be associated with the Agreement. Article 14 is a similar provision. It provides for the admission of some other country, as a third or fourth party, into the free trade area upon terms that are acceptable to the current Members. Article 15, a formal machinery provision, deals with administrative co-operation. Article 16 ensures that there will be regular consultation. Finally, Article 17 deals with the entry into force of the Agreement.

The Agreement is unchangeable for a period of 10 years. It can be changed upon the giving of two notices, the first of 90 days, following which there is to be consultation, and the second of 180 days. Those notices may be given during the period of 10 years, but they will have no effect until the 10 years have completely run. There is in the attachments to the Agreement, apart from the Schedule, an exchange of letters between Australia and New Zealand under the clauses to which I have directed attention varying the provisions of the Agreement. They mainly concern the four items I have indicated, although they do cover other matters such as timber products. I do not refer to them in particular at the moment, and I will not do so until I am dealing with the various commodities.

I come now to the question of frozen beans and peas included in the Agreement. On the north-west coast of Tasmania the area is dotted with happy little towns backed by rich country mainly concerned with dairying, but growing a cash crop of beans and peas. About 900 growers are concerned with dairying, pigmeats, cheese and particularly with the growing of green peas. In that area in paddocks that aggregate only about 15,000 acres about 60 per cent, of all Australia’s requirements in green peas is grown. It is completely clear that double that acreage in that area is suitable for the industry and would enable the farmers there to supply from that area alone more than the whole of Australia’s requirements in both green peas and beans. The returns from beans are most important to the growers, who are paid 5d. a pound.

A tremendous amount of work is provided in the processing factories along the coast. The moneys expended in the area run into millions of pounds a year. Well over £1 million is paid to growers. About £1 million is paid to workers and money is paid to the makers of containers, transport workers and so on. It is clear that the economy of the north-west coast hinges very largely upon the success of sales of peas and beans. A tremendous growth has occurred in the acreage put under green peas. In 10 years it has risen from 3,500 acres to about 15,500 acres at present.

The difficulty of growers is that they are protected at the moment by a duty which operates when the f.o.b. value of goods exported to Australia falls below ls. 10+d. per lb. If the f.o.b. price falls below ls. 10 1/2d. per lb., a duty of id. per lb. is imposed. Each time the value of the goods brought into Australia falls, a duty of id. per lb. is imposed in relation to each Id. of the fall below ls. 10 1/2d. That price has remained unchanged for about five years. The growers have contracts with the processors. The peas are carefully checked - almost daily - at the ripening period and they are taken off completely at the peak of their development. The whole plants are taken away and the peas are put through processing into cans and deep frozen with? out a hand touching them. It is a very sanitary and efficient operation. As I said, the price has not been varied and any rises in cost in the intervening years have been borne by the growers. They now find that their whole organisation on their relatively small farms is disrupted by the gradual elimination and ultimate abolition of duties on pigmeats, cheese, and on beans and peas with which they are primarily concerned.

Their greatest competition is from peas imported from New Zealand. The growers face a new threat in that a patented process has been evolved that reduces an ordinary 10oz. packet of green peas to one-quarter of that weight by a dehydration process. The peas are easier to handle and transport and a terrific freight differential is gained by New Zealand as against Tasmania. The freight charged from New Zealand to Sydney is 226s. 6d. a ton; from Tasmania to Sydney it is 217s. a ton, giving Tasmania an advantage of 5s. 6d. a ton. However, because of the dehydration of the peas, New Zealand can export four to five times the quantity that can be transported by Tasmania in bulk at the same freight cost. New Zealand can put into a 2 oz. packet dehydrated peas which, when they again pick up water, represent a 10 oz. packet produced in Tasmania and sent from there to Sydney.

Two other factors operate in favour of New Zealand. It has a better rainfall and a better distributed rainfall. The New Zealand basic wage is £4 a week lower than the Australian basic wage. These things conspire to give a great advantage to the New Zealand growers. With the elimination and the ultimate abolition of duty on imported peas, one may naturally expect that production and exports from New Zealand will be stimulated. New Zealand’s exports will grow because of the advantages of the New Zealand growers. Members of the Tasmanian industry feel that they are facing a very real threat and that they may be forced to lose completely one of their mainstays of income. Under the details of the Agreement, no quantity limitation is imposed upon the import of beans and peas from New Zealand or, at the moment, from anywhere else. A great quantity of frozen peas is imported from the United States of America; indeed, more than is imported from New Zealand.

Senator Wright:

– Does the honorable senator have the figures available?

Senator McKENNA:

– Yes. I think I can say directly that almost 3 million lb. of green peas came in from the United States of America last year; approximately 2 million lb. of green peas came from New Zealand. 1 think one can reasonably expect that those figures will grow enormously once the duty has begun to be cleared away and is ultimately eliminated. I pose to the Senate that here, is a very real problem with which the people of the north-west coast of Tasmania are gravely concerned and disturbed. Their various organisations have expressed their dissent from the proposal to include deans and peas in the Agreement. The Canning Peagrowers Association which embraces almost 100 per cent, of the growers, the Tasmania Farmers Federation, and the Australian Primary Producers Union, have protested to the Minister for Trade and Industry and the Commonwealth Government. They have been joined in their protests by a Tasmanian Minister.

It seems to me that with the land available, the prospect of development and the ability to supply the requirements of the whole of Australia, it is an ideal situation which we ought to seek to encourage. We should attempt to provide work in the relatively remote areas so that families may be kept together because of the diversity of occupations provided. Work can be provided in the area in the thousand and one ways related to the processing. This would permit the dairying industry to run on with its side issues of pork and cheese in conjunction with beans and peas,

I come to the other two elements, pork and cheese. I understand that at present the duty on ham and bacon runs at the rate of 3d. a lb. against outsiders. This duty is to be abolished immediately. In fact, it was abolished on 1st January 1966. Pork is allowed in duty free to processors only up to an amount of 3,000 tons in the first year increasing by 5 per cent, in each succeeding year. That will affect our production of some 120,000 tons.

Senator Wright:

– Of pork?

Senator McKENNA:

– Yes, of pig meats.

Senator Wright:

– Which is. it?

Senator Webster:

– Fresh pork is 120,000 tons local market. I do not have the figure of our production.

Senator McKENNA:

– In any case, I put the matter in perspective. Against the Australian use of 120,000 tons, 3,000 tons are to come in completely free in the first year. As was pointed out to Mr. McEwen at one of his meetings, this means that whereas up to 1st January the duty was 3d. a lb. there now will be 3,000 tons in the first year completely free of duty and the next 3,000 tons will carry duty of 3d. a lb. If that duty is averaged over 6,000 tons it is really cut in half and the first 6,000 tons is coming in at a duty of lid. This is a factor that the people in the industry consider to be serious. However, because the pork population of New Zealand has been afflicted with a disease called, I think, trichinosis, the importation of all non-processed pork has been completely prohibited. None has been coming in for many months.

The duty on cheddar cheese will be eliminated over a period. I think it is at present 6d. a lb. However, a quantity restriction has been placed on the importation of cheese and this will apply for a number of years. Over a period of, I think, eight years the importation will increase from 400 tons a year to 1,000 tons a year. The local production is about 60,000 tons. That throws one more scare into the pea growers in Australia. Their cheese production will be affected and there will be more competition for their pig meats than they expected. By and large they feel they have been smitten hip and thigh. We of the Opposition have pledged ourselves to do what we can to defeat the abolition of the present duties on the items to which I have referred.

Senator Anderson:

– The honorable senator put up an argument on peas and beans as affected by the dehydrated product from New Zealand. Would he care to comment on what is being done in Tasmania in that field?

Senator McKENNA:

– The position is being investigated to see whether the farmers in Tasmania can use the same or a similar process. I think it unlikely that the holder of the patent in New Zealand will allow them to use it because I believe that he is establishing a pilot plant in Gippsland at present to see whether the dehydration of peas in Australia can be successfully undertaken. We might find ourselves with that process under a New Zealand patent operating here.

Senator Wright:

– But the duty was imposed for the protection of our beans and peas before New Zealand gained that advantage of dehydration.

Senator McKENNA:

– That is true. Very few dehydrated peas have come in.

Senator Anderson:

– The honorable senator used that argument fairly forcefully in his presentation. In fact, he built his case around it.

Senator McKENNA:

– That is right because here is an obvious new factor which has entered into the situation. I realise that very few dehydrated peas have come in so far and I realise that the industry has to make its way, but there is a new element of threat with a great cost advantage to the outsiders by reason of the easier freight charges and the lower costs of production in New Zealand. T should think that the pe.a growers of Australia - we have them in places other than Tasmania - should be concerned about the 3 million lb. of green peas which come in annually from the United States because the balance of trade runs strongly against us. I recommend to them that they seek further tariff protection against the importation pf that quantity of frozen peas from America which is running at a value of more than £500,000 annually. Added to the importation from New Zealand, they could be faced with a serious threat.

Senator Wright:

– That was discussed at the Ulverstone meeting. Has the honorable senator any information as to the Tariff Board’s likely attitude to the matter?

Senator McKENNA:

– J. cannot say. I realise too that one has to look at the country’s obligation under the General Agreement on Tariffs and Trade before doing anything about this matter but it is something which should be canvassed by the growers. That is the point I make. (Extension of time granted). I am obliged to the Minister and to honorable senators. I want to deal now with butter and to refer to a speech made by the Minister for Trade and Industry on Wednesday 9th February last during a by-election campaign in the Dawson electorate. A copy of the speech has been circulated by the Minister. When referring to butter he said -

The first day I stepped into New Zealand I said: “ Butter is out. We cannot entertain free trade in butter”. And butter is out, and will remain out. And butter is out for 10 years. Now butter was not out for 10 years the day before I signed the

Agreement. Butter could have come in from New Zealand on the decision of any government at any day of the week before I signed the Agreement. But now I have signed an Agreement with New Zealand which, for the first time in our history, says no New Zealand butter for the duration of this Agreement, which is 10 years. This is a protection against a danger that I think was quite remote but a possibility.

I ask the Minister: If there is such an agreement, why was it not tabled along with this document? There is no reference whatever in the New Zealand-Australia Free Trade Agreement to butter. The matter is not mentioned at all.

Senator Gair:

– The Government is keeping it confidential.

Senator McKENNA:

– That cannot be the reason because it was not confidential when the Minister for Trade and Industry stated before the electors in Dawson -

But now I have signed an Agreement with New Zealand which, for the first time in our history, says no New Zealand butter for the duration of this Agreement . . .

Senator Cotton:

– It is not mentioned because butter is excluded from the Agreement as are so many other items.

Senator McKENNA:

– If the Minister made that statement because there is no reference to butter in the Agreement, their the duty of 6d. per lb. stands and there is no prohibition upon the export of butter by N.ew Zealand to Australia. Also, what the Minister for Trade and Industry said cannot be correct because unless there is a specific agreement upon the point, New Zealand can do today exactly what it could do the day before the Agreement was signed.

Senator Benn:

– Under the 1933 agreement.

Senator McKENNA:

– Yes. The Minister cannot say with accuracy what he has said -

Butter .could have come in from New Zealand on the decision of any government at any day of the week before I signed the Agreement.

The Minister was talking there about the Agreement we have before us, and he continued^ -

But now I have signed an Agreement with New Zealand which, for the first time in our history, says no New’ Zealand butter for the duration of this Agreement . …

I invite the Minister to tell me whether that provision is in this Agreement. If it is not in this Agreement, where is it in any agreement? If it is not in any agreement, then a completely wrong position has been put forward as being a great protection; but upon what I have said, there is no such agreement. I do not vouch for that but I should like that point checked and I invite the Minister to state specifically: Is there an agreement of the nature mentioned by the Minister for Trade and Industry and if so, will he produce it? If there is no agreement, why did the Minister make this statement? If there is an agreement, why is he withholding it? We ought to have the answer on that particular point. I invite the Minister with particularity or any honorable senator speaking in this debate, to address himself to that point.

I am amazed that time has run away so quickly and I am obliged to the Senate for its indulgence. I do not know whether honorable senators are any better informed as a result of my speech. I know that I am a little more exhausted as I sit down than I was when I stood up.

Senator WEBSTER:

.- I am pleased to follow the Leader of the Opposition (Senator McKenna) in discussing the New Zealand-Australia Free Trade Agreement. The Agreement has not been discussed in the Senate in the four or five months since it has been in operation but we have an opportunity now to enlighten our minds on a matter which is on a national level. The Leader of the Opposition delivered his review of the Agreement in excellent style as he always does and commanded the attention of the Senate which gave him an extension of time so that he might cover all points of the Agreement. But I have some difficulty in understanding his position in relation to the Agreement.

At the outset, the Leader of the Opposition indicated that the Australian Labour Party was not opposing the acceptance of the Agreement but he went on to circulate an amendment. Undoubtedly, there are various areas of manufacturing and primary production which are affected to some extent by the Agreement. Although there are many items in respect of which it might be argued that there might be cause for concern, the Opposition has chosen to submit an amendment stating -

The Senate is of the opinion that the Agreement will be detrimental to the interests of Australian primary producers.

The Leader of the Opposition did not back up that opinion. He moved from that particular point and said: “ We feel there are three areas of Australian primary production which are affected.” He went to some lengths to discuss these three areas which are the frozen pea and bean industry, the cheese industry and the pig meats industry. I take it from his speech that there are no other areas affected. The Leader of the Opposition mentioned butter but his main theme was that the Opposition felt that while it concurred with the Agreement, it considered there were three areas of primary production which would be adversely affected and to that extent it disagreed with the Agreement.

I think this matter should be put into perspective. The Australian people should be made aware that in this national matter, the Opposition is not taking the stand it has adopted traditionally over many years in relation to agreements with other nations. Perhaps this is because while this Government has negotiated trade arrangements with other nations over many years, experience has shown that the Opposition took an incorrect stand in opposing such national trade arrangements. In the case of the New Zealand-Australia Free Trade Agreement, perhaps the Opposition believes that the national interests of both countries - which incidentally were not mentioned by the Leader of the Opposition - are of such great importance that it should overlook the factors which might cause some difficulty. I use that word advisedly.

The Leader of the Opposition apparently believes that the pea and bean growers will be adversely affected by the Agreement. I assume that he is fairly close to the feeling of the Tasmanian pea and bean growers and believes that the Agreement may affect that industry. But in my opinion the remarks of the Leader of the Opposition on that point and Senator Wright’s interjection at the time were far astray insofar as they might be taken to express a reasonable viewpoint of the actual position.

Senator Wright:

– In what way does this Agreement serve Australia’s national interest?

Senator O’Byrne:

– Does the honorable senator consider that the industry in Tasmania is expendable?

Senator WEBSTER:

– I have heard Senator Wright speak in the Senate on defence matters. He has referred eloquently to the defence aspect of this Agreement between New Zealand and Australia. I shall quote a comment by Ministers in New Zealand which Senator Wright no doubt will be pleased to hear because their views of the position are identical with our own.

Senator Wright:

– I was not referring to defence. I was conjoining my remarks to economic matters.

Senator WEBSTER:

– I believe this Agreement goes beyond being just an economic agreement. I think it is the basis for and the commencement of something greatly in Australia’s national interest. Senator O’Byrne said that he saw an industry in Tasmania being regarded as expendable. I do not doubt that he does the Minister for Trade and Industry (Mr. McEwen) more justice than to believe that the Minister would regard any Australian industry as expendable and cast it away.

Senator O’Byrne:

– The honorable senator has admitted that that is virtually happening. He has admitted that that has to happen on the national level.

Senator WEBSTER:

– I have not admitted that. I am endeavouring to point out to the honorable senator that we must see this as a national proposition. The history of members of the Opposition shows that they find it very difficult to look above what may be called the local level. Will Senator O’Byrne tell me whether there .is some prospect here of disadvantage because of a process being used overseas which is not being used in Australia at present? Japan has manufacturing techniques which are not available here. There is no question of casting industries to the wind. Indeed, the Leader of the Opposition emphasised the protections that are given by this Agreement. I hope that if any detriment to an Australian industry arises, Senator O’Byrne will be very vocal in this Parliament in drawing attention to the protections that are available under the Agreement. I certainly will be, because I do not wish to see any Australian industry affected detrimentally by imports from any overseas country, friendly or otherwise.

Senator Wright:

– I have had long experience of trying to get audience for small Tasmanian industries, but that experience has not been encouraging.

Senator WEBSTER:

– They probably need better representation. I support the general principles of this Agreement. I believe that the Agreement will engender not only wider trade but also very wide policies. It is true to say that the main stabilising elements of both the countries concerned are the primary producing industries. It is also true to say that the agreements which now exist between Australia and Great Britain and between New Zealand and Great Britain are the greatest stabilising elements in the economies of Australia and New Zealand. Let me put it to Senator Wright that, on the national level, we must face the fact that there is a possibility of our losing the British market. Surely we will not put our heads in the sand and say: “ Let things go on as they are “. Great Britain failed to join the European Economic Community and undoubtedly will never enter that Community “. This is a matter of great importance to Australia and also to New Zealand.

Senator Wright:

– What industries would be prejudiced by Great Britain joining the European Common Market but not by the operation of this Agreement?

Senator WEBSTER:

– I will leave the honorable senator to point out such items when he makes his speech. The Australian Government has an obligation to create markets for Australia. The advantages to be derived from this Agreement will not necessarily all flow to New Zealand. This is considered to be a truly two-way flow. The Party to which Senator Devitt belongs opposed the Japanese Trade Treaty, but surely honorable senators opposite would not now say that that has been bad for the economy or for the national interest of Australia. Can anyone point to Australian industries that have been put out of existence because of the manufacturing techniques and the labour available in Japan? We have been able to take steps to protect Australian industries that have been adversely affected by imports from countries such as Japan. I believe that this Agreement with New Zealand will be of great assistance, not only to our primary industries, in which I am particularly interested, but also to our secondary industries. Those industries will have easy access to markets to which at present they do not have very easy access.

Senator Devitt:

– The honorable senator is saying that primary products will finance the flow of secondary exports to New Zealand, is he?

Senator WEBSTER:

– I do not say that. If the honorable senator likes to put the matter in that way, he can do so; but I certainly do not put it in that way. Let me go on with the national aspect. Senator Wright apparently wonders whether there is any national aspect about this. I believe this Agreement represents a national endeavour to expand facilities not only for our primary industries but also for our secondary industries. As far as our primary industries are concerned, we have as much ability to export to New Zealand as New Zealand has to export to us. Senator Devitt apparently believes that there is no possibility of our selling any of our primary products to New Zealand, and that in this field the New Zealanders are too good for us. I would not accept that. However, I do say that there is a great possibility of obtaining markets in New Zealand for the products of Australian secondary industries. I foresee that, as a result of encouragement by both countries, there will be established in New Zealand manufacturing plants similar to those that are already here. Once a flow of products commences, it will be seen to be wise to establish in New Zealand industries to manufacture those products, and both we and New Zealand will encourage that.

Surely another national aspect of this matter is that as the Agreement will lead to the establishment or expansion of industries, we will be able to utilise a greater inflow of migrants. I see this as one of the great features of the Agreement. As I said last night, one of the greatest protective measures for Australia is the development of her internal resources and the expansion of her manufacturing industries. Manufacturing industries are practically the only industries that can absorb further labour. 1 am certain that honorable senators will agree with me that the expansion of our manufacturing industries is essential.

Another factor to be considered is the improvement of standards of living in nearby developing countries. Before I was rudely interrupted, I was about to say that the Agreement envisages only a commencement with New Zealand.

Senator Wright:

– My interjection was offered as a courtesy of interest to the honorable senator’s argument.

Senator WEBSTER:

– I accept that. Article 14(1) of the Agreement declares that Member States may agree to the association of other States with the Agreement. That envisages the Agreement becoming much greater and much wider than just a New Zealand and Australia free trade agreement. The Agreement says also that such association may be in respect of the metropolitan territory of any State or in respect of a territory for the international relations of which it is reponsible. I foresee that this Agreement will be a much wider proposition than merely a New ZealandAustralia agreement. The implications of an agreement such as this are indeed wide and the acceptance of it requires a revision of national thinking.

I would like to give the Senate a few facts about New Zealand because 1 believe that Australia with a population of some Hi million people and with a projected population much greater than this in years to come, should, perhaps, feel that New Zealand is a country to be encouraged. New Zealand lies some 1,400 miles southeast of Australia. Its land area is 103,000 square miles. Its population is only 2i million. One-third of New Zealand is under pasture and crop, one-third of the area is marginal land suitable only for cattle, sheep and forests, and one-third is mountainous country which, at this particular time, is of little use for productive purposes. New Zealand’s main exports have been wool, dairy products, meat and fruit. It has a larger import and export trade per head of population than has any other country. The United Kingdom is New Zealand’s main customer. New Zealand is facing a period of great development, but it still desires even greater expansion and development. Australians, I believe, feel a particularly close tie with New Zealand. The reliance of each upon the other during the period of two world wars is certainly evidence of that fact. We had a trade treaty with New Zealand, I thought, some 20 years ago, but I understand that Senator Benn said it was 30 years ago.

Senator Benn:

– Thirty-three years ago.

Senator WEBSTER:

– The date of the treaty was listed in a document I had as being 1945, but it must have been 1935. We have had a trade treaty with New Zealand for over 30 years. This has undoubtedly assisted the growth of New Zealand, and it has undoubtedly assisted our own growth. I believe that arrangements between neighbouring countries in the South Pacific area must be of benefit to us. They should be of benefit to the two countries. They provide for better relations between the countries and for a recognition of the interests and requirements of their people. They also provide an immediate awareness of the defence needs of both countries, and an awareness of the common problems of development, primary production and secondary industry. A greater welding of friendship should occur between the two countries as a result of this Agreement. It should assist the expansion of markets for both primary and secondary industries. Undoubtedly, the agreement which was reached some 30 years ago, has achieved this result so far. I believe that the new Agreement will add greatly to the particular relationship between Australia and New Zealand.

The importance of the Agreement is demonstrated by the interest that both countries have taken in it. The Agreement has not been entered into lightly or inadvisedly. The negotiations commenced as far back as February 1961.

Senator Devitt:

– But the industries concerned did not know anything about it then.

Senator WEBSTER:

– I imagine that negotiations, of which it is not. necessary for industries to be advised, are taking place today with other countries. I think that the honorable senator agrees with that. Negotiations for promoting the Agreement between the two countries have taken place for a number of years. In the first year a study group was set up. From that time till now, ministerial visits have been exchanged between the two countries, and the heads of departments and study groups have considered this matter very carefully. Both countries have made it clear that their intention in entering into the Agreement is that at this time and for many years to come they will be growing and developing countries. Both countries enter into the Agreement on the basis that they will be better served by such an agreement than they were by the conditions which existed hitherto.

Senator McKenna mentioned a fact but I shall repeat it. The Agreement covers 60 per cent, of the total trade between the two countries. It covers 85 per cent, of all New Zealand’s exports at the present time. The two parties to the Agreement have realised that it is not in the interest of either party to swamp the other with goods of a particular kind. No good purpose will be served throughout the term of an agreement like this by expecting something disastrous to happen to a particular industry. Both countries have realised this from the outset. I believe that Australia and New Zealand are aware of the different levels of development in the two countries. Australia on the secondary industries basis is more developed than is New Zealand. Australia today, thanks to quite good government, I believe, imposes a lower company tax than does New Zealand. Industrial development needs to be further promoted in New Zealand, and I sincerely hope that Australian manufacturers will attempt to do this.

On the latest figures, Australia has had a substantial trade advantage over New Zealand for some years. Exports to New Zealand from Australia amount to $128 million per annum, whereas imports from that country amount to $32 million. Those trade figures in either instance are not very great. They are figures which in economics today do not demonstrate any large volume of trade. Trade should certainly be encouraged on both sides. New Zealand has had to consider its manufacturing industries in this Agreement to a greater extent perhaps than is the case in Australia. It is interesting to note that the Minister for Overseas Trade in New Zealand, Mr. Marshall, stated that there was general agreement between the two countries.

Sitting suspended from 5.44 lo 8 p.m.

Senator WEBSTER:

– Prior to the suspension I was canvassing the general advantages, as I saw them, of the Free Trade Agreement between New Zealand and Australia. I commented that I thought that the Trade Agreement provided not only an economic benefit to both countries but also something of national benefit. I mentioned the value of the trade between our two countries, putting the amounts in dollars. I said that Australian sales to New Zealand amounted to $128 million and the reverse New Zealand sales to Australia amounted to $32 million. I had taken those figures from the New Zealand “ Hansard “, but the Australian Minister for Trade and Industry (Mr. McEwen) puts the sales by Australia to New Zealand at £79 million and sales from New Zealand to Australia at £23 million. I apologise if I have misled the Senate. I had converted the figures from £A into dollars but I have now obtained the correct figures from a statement by Mr. McEwen. The figures I gave earlier, which I got from the Parliamentary Library, are not correct. It could be that last October the New Zealand authorities were giving the figures for an earlier year, which looked to me to be in the same step of progression.

Senator Sim:

– Expressing the figures in New Zealand currency - sterling - would probably make the difference.

Senator WEBSTER:

– Would it, to that extent? The figures I gave might have been right. I said also that the importance of this measure had been demonstrated by the interest throughout Australia and New Zealand. I suggested that we, as members of Parliament, should do all that we could to encourage this partnership and this Trade Agreement. I arrived at the point of saying that the New Zealand Minister for Overseas Trade, Mr. Marshall, had stated that there was general agreement that this Agreement was satisfactory from New Zealand’s point of view and that Australia had made valuable and sensible concessions in the interests of mutual trade.

Another comment was that this Agreement showed enlightened self-interest on the part of both Australia and New Zealand. I note that Mr. Marshall suggested that New Zealand regularly recognises Australia’s lonely isolation, that Australia is nearer the perimeter of tension in this area of South East Asia and that it is of strategic significance that close and acceptable association between our two countries is very necessary. This is a positive and vigorous approach that can be spelled out throughout the whole of the Agreement. It is very definitely to the advantage of both of our countries.

Senator McKenna made some comment about the relationship that this Agreement may have to the General Agreement on Tariffs and Trade. Generally, free trade areas are not acceptable, as I understand it, under G.A.T.T., but there are two existing and acceptable free trade areas at the present time. The European Free Trade Association and the Latin American free trade area are acceptable. It is of note - Senator McKenna may be aware of this - that the New Zealand-Australia Free Trade Agreement has been under discussion in G.A.T.T. during the last several weeks.

Senator Wright:

– What is the concern or interest of the G.A.T.T. countries in it?

Senator WEBSTER:

– Under G.A.T.T., as I understand it, in order for countries associated with that Agreement to make a deviation or any other agreement, it is necessary at least for the G.A.T.T. countries to be aware of what is being proposed. If I understood Senator McKenna’s remarks correctly, he suggested that this arrangement must be acceptable to G.A.T.T. I am putting the proposition that at the last session of the G.A.T.T. countries at Geneva examination and consideration were given and completed and within the last two weeks, while not approving the free trade area proposed in this Agreement, G.A.T.T. has given the green light and has stated, in short, that this arrangement should be permitted and that it may be pursued. Australia and New Zealand will be reporting on the progress of this free trade area.

The Agreement is viewed quite well by trade and manufacturing associations on both sides of the Tasman. The President of the New Zealand Manufacturers Association, Mr. S. J. Ball - who surely represents an area of business which has more reason to be concerned with this Agreement than our own manufacturers association - has stated that the Agreement is statesmanlike and that the negotiators are to be complimented. He accepts the Agreement fully as it is laid down, realising the protections that are there. Mr. H. G. Ferrier, President of the Australian Chamber of Manufactures, commenting on whether Australian manufactures would flood the New Zealand market, said that it would be a bad strategem for Australian manufacturers to seek only their own advantage, and that they should realise that both countries need to be industrially strong to hold their place in the South East Asian area.

Both countries recognise the Agreement as a positive and vigorous approach. The import duties that existed prior to this Agreement are to be reduced and eliminated. In general, where no duties apply at present, there will be no duty. Duties not exceeding 5 per cent, at present are to be removed. Duties of 5 per cent, to 10 per cent, are to be reduced by 50 per cent. Duties exceeding 10 per cent, are to be reduced by 20 per cent, every two years, in five stages over the next eight years, with the immediate application of a 20 per cent, reduction. It is interesting to note that the New Zealand Government at present stands to lose £30,000 in duties by the introduction of these provisions.

So there are several main areas of trade which are affected by this Agreement. In the centre of these is the forestry industry. Forest products form a central core. Indeed the entire field of pulp and paper manufacture, rough sawn and dressed timber, plywoods, etc., is affected by the Agreement. Australia is retaining the general thought that we wish manufacture to be conducted here. This does not follow fully all the way. Wood pulp and newsprint are already admitted to Australia duty free, but general stationery and items of such nature, prefabricated houses, and timber already prepared for boxmaking are not to be admitted. The application of the Agreement to those other commodities that are now free of duty will certainly give an impetus to this particularly important industry. New Zealand foresees tremendous development in trade in forest products. Recently in this chamber we discussed the boost that has been given to our forestry industry. It is pleasing to note that New Zealand estimates that following the negotiation of this Agreement sales of forest products to Australia could rise to £30 million by 1975 and to £60 million by the end of the century.

Senator McKellar:

– Are they New Zealand or Australian pounds?

Senator WEBSTER:

– I am not sure. The Minister may take his pick. I think the figures were taken from the New Zealand “ Hansard “. The products of the New Zealand softwood industry are particularly good. There are many Australian interests in New Zealand. I hope that the Australian timber industry will take an even greater interest in this particular arm of primary production in New Zealand.

Senator Wright:

– Under this Agreement, what duties will they be exempt from in respect of Australian imports of New Zealand timber?

Senator WEBSTER:

– I have not the figures before me. I have stated that manufactured items in general are to be excluded. Imports of timber will continue to flow as they have in the past. When speaking to his amendment, Senator McKenna mentioned three commodities in relation to which he suggests that great difficulty will be experienced. I believe that the Australian Labour Party was speaking with its tongue in its cheek when it moved the amendment. In suggesting that the Agreement will be detrimental to the interests of Australian primary producers, Senator McKenna did not refer to primary industry in general but to three commodities in particular.

Senator O’Byrne:

– He referred to three sets of primary producers.

Senator WEBSTER:

– Yes. Believe me when I say that this Government will never do anything to hurt the interests of primary industry in Australia. I can assure honorable senators opposite of that. This Government will ensure that in every instance our primary industries will be protected. The Labour Party is well aware that this Agreement affords all the protection that is necessary.

Let us consider the position in relation to frozen vegetables, which I admit is of vital interest to Tasmania. It has been stated that at the present time protective duties in Australia are charged on a sliding scale on the f.o.b. value of the imports. The duty is less than ls. 10id. per lb., and for every penny below ls. 10 1/2d. a duty of two-thirds of a penny is payable. Under the terms of the Agreement, it is proposed that protection against competition from New Zealand frozen peas and beans will be maintained for nine years. The first reduction in the duty on these commodities will not take place within 12 months after the commencement of the Agreement. Obviously there has been no alteration to the existing position to date, but gradually over a period of nine years the protection will be phased out. Senator McKenna did not mention the methods of snap freezing and dehydrating that have been adopted in New Zealand. I am confident that the Australian industry will be able to adopt any method that has been employed overseas and which may not at present be used in Tasmania and to meet competition. In any case, the Agreement provides sufficient protection, the nature of which I hope to mention in a moment.

The second branch of primary production to which Senator McKenna referred was the production of cheese. At present Australia produces about 60,000 tons of cheddar cheese. Honorable senators opposite apparently are trying to convince a section of the Australian economy that this Government is doing something to harm industry. Never let it be said that our Minister for Trade and Industry (Mr. McEwen) would do anything like that. It should be interesting for our friends opposite to note that at the present time any quantity of cheese can be imported into Australia. One can bring in as many thousands of tons as he wishes, but he will have to pay a duty of 6d. per lb. I am told that last year we imported approximately 260 tons. Pursuant to the negotiation of the New Zealand-Australia Free Trade Agreement, at the end of five years there will be an import ceiling of 1,000 tons. In the first year 400 tons will be permitted into Australia, in the second year 400 tons, and in the third and fourth ‘ years 800 tons. Another fact not mentioned by the Opposition is that at any stage the price payable is subject to the agreement of the Australian and the New Zealand dairy produce boards. In the light of these facts, surely it is unfair of the Opposition to say that the Australian cheese manufacturing industry is likely to be placed at a disadvantage.

If we look at the worst side of the picture, an additional quantity of 140 tons could come in in the first year. 1 understand that if that occurred the out of pocket cost to the Queensland producer would be approximately $3 per annum. The Commonwealth is paying to all producers a bounty which is far in excess of that sum. We could be forced to seek markets for 140 tons of our product. We might have to look to Britain for that market. Following the negotiation of the Japanese Trade Agreement we have found a market for cheese that we never thought was possible. I think I am correct in saying that approximately 3,000 tons of cheese go to Japan annually. I am quite certain that the agreement that has been made between Australia and New Zealand will do nothing to upset our cheese manufacturing industry. The Agreement provides adequate protection for our industry.

Senator McKenna referred also to pig meats. Pig meats come from New Zealand to Australia in two forms - first, in the form of cured ham and bacon and, secondly, in the form of pork for curing or manufacturing purposes. Prior to the negotiation of the Agreement first class bacon and ham attracted a duty of 2d. per lb. or 21 per cent, whichever was the lower. New Zealand was free to send as much bacon and ham as she wished. All honorable senators must realise that a duty of 21 per cent, at no stage would deter a business man if he wished to promote a greater volume of sales in this country. Last year we received 43 tons of this product and in Australia we produced 43,000 tons. What utter rot it is to say: “ Here is something which is likely to run the Australian pig meat industry into the ground “. A quantity of 43 tons was imported although New Zealand had free access to our market and was subject to the imposition of duty of only 2b per cent. The elimination of the 2£ per cent, duty will mean nothing to the Australian production of 43,000 tons. New Zealand does not represent a threat to the bacon and ham industry in Australia. It has been free to sell here subject to payment of only a small duty. The short of it is that New Zealand sends to Australia one ton for every thousand tons produced here. I think that the amendment moved by the Opposition represents a distortion of facts, and this has not been done for national purposes.

Prior to the operation of the Agreement a duty of 3d. per lb. or 10 per cent., whichever was the lower, was payable on imported fresh pork. The Agreement abolishes the duty and establishes a quota of 3,000 tons, which will rise by about 5 per cent, per annum. In 1963-64. whilst paying duty of 3d. per lb., New Zealand sold 2.600 tons of fresh pork to Australia. At present New Zealand is not exporting fresh pork to Australia because an outbreak of swine disease over there has caused an embargo to be placed on imports from that country into Australia. But even if pork were being imported and the entry of thousands of tons were permitted the market in Australia is 120,000 tons. Again, the imposition of a duty of 3d. per lb. would make little difference to the amount likely to be imported. Furthermore, only processors are allowed to import fresh pork. Not everybody is allowed to import that product.

The general provisions of the Agreement can be revoked if an industry needs safeguarding. 1 shall deal further with this matter when referring to the protection clauses. The Minister for Trade and Industry (Mr. McEwen) has given an assurance to our primary industries. He has said that the Government regards the welfare of the Australian dairying industry as of the utmost importance. It will ensure that the dairying industry is safeguarded in the arrangements undertaken with New Zealand.

The Opposition cared to suggest that there were only three items which might create some problem for the Australian primary producers. Honorable senators opposite would have some difficulty, if they cared to declare the facts as they are, in convincing the Senate that there is a risk involved in relation to those three items of primary production. Protection is written into the Agreement in a variety of ways. The general proposition is that, first, there should be provision that the industrial development of both countries will not be affected and that the schedule would not include goods which may in any way be detrimental to the manufacturers in either country. The second provision is that if experience proved that imports threatened an industry, the Agreement could be suspended. This would be determined on experience of the working of the Agree ment. If a new industry wishes to become established, certain provisions apply whereby imports may be suspended. Both countries have agreed that by this provision a new industry can gain a foothold.

I believe that Article 9 contains the most important provisions in the Agreement. I think they must be spelt out. We must not say that we do not believe that this is what will happen. We must not endeavour to cause dissention in Australian industries. Article 9 provides for the temporary suspension of obligations, if necessary. Paragraph 1 of the Article states -

If, as a result of the application of any of the provisions of Articles 4, S and 6 of this Agreement. . . .

Which relate to import duties, quantitative import restrictions and revenue duties to be applied -

Scheduled goods are, in the opinion of a Member State, being imported into the territory of that Member State in such increased quantities and under such conditions as to cause or threaten serious injury to its producers of like or directly competitive products, that Member State may in writing request consultations with the other Member State on measures to prevent future injury and shall consider any measures taken or proposed by the other Member State. For the purpose of this Article consultations shall be deemed to have commenced on the day on which the request was made.

To honorable senators who speak against this provision and say that there is a possibility of something occurring, I say that surely we must be reasonable. Either signatory to the Agreement, which we hope will continue for at least 10 years and for many years after that, if there is even the barest possibility of the flooding of the market or of damage being caused to an industry in either country, may say immediately to the other country: “ Because some manufacturers need help, would you just hold your exports for the time being? We do not want any dissension to occur.” This position applies to our trade agreements with other countries today and it is logical that it will also apply to the New Zealand-Australia Free Trade Agreement.

Senator O’Byrne:

– According to the honorable senator, things are so good that there is no need for the Agreement.

Senator WEBSTER__ The honorable senator has said that; I did not. Paragraph 2 of Article 9 states -

If the Member States do not reach a mutually satisfactory solution of the matter within a period of sixty days from the commencement of the consultations referred to in paragraph 1 of this Article, the Member State into whose territory the goods are being imported may, after giving notice in writing to the other Member State, suspend, to such extent and for such time as it considers necessary to prevent future injury to its producers of like or directly competitive products. . .

I do not think that a better condition could be written in than one which provides that if a member State notifies another member State that something is threatening an industry, a period of 60 days wait should occur. Undoubtedly, that period would be needed to look into the matter thoroughly, and then imports of the item concerned could be suspended. Article 10 of the Agreement refers to dumped and subsidised imports. Paragraph 2 of that Article states -

If a Member State gives written notice to the other Member State that, in its opinion, goods being imported into its territory from the territory of the other Member State are within the meaning of its lows being dumped, or are being subsidised by the other Member State, and the importation of such goods is causing or may cause material injury to its producers of like or directly competitive products, or may hinder the establishment of an industry to produce or manufacture like or directly competitive products, the Member States shall thereupon consult together immediately to consider measures to prevent future injury.

There is completely adequate protection. Paragraph 7 of Article 4 states -

The Member States may agree that import duties on any scheduled goods shall be reduced or eliminated over a longer period than is provided in paragraph 2 of this Article.

Surely that provision has application to the frozen peas and beans industry, to which some honorable senators have referred. Undoubtedly the comments that have been made will cause some worry to persons in the industry. According to paragraph 7 duties on scheduled goods may be eliminated over a longer period if necessary.

Senator Wright:

– If both States agree.

Senator WEBSTER:

– Surely the honorable senator does not suggest that there will not be agreement for a continuation of this proposal which admittedly is so important to New Zealand - in fact, more important to New Zealand than to Australia.

Senator Wright:

– I think it will be conducted on a business basis.

Senator WEBSTER:

– I, too, think it will bc conducted on a business basis. Senator McKenna made a comment about butter. 1 do not think his interpretation recognises that there is to be absolutely no change in relation to butter and its effect on New Zealand and Australia. The point is that Australian butter producers will be no better or no worse off than they were prior to the Agreement.

This is a starting point so far as agreement with New Zealand on many items is concerned. Something over one half the possible trade is envisaged at the moment. I will encourage to the utmost an expansion of the terms of the Agreement. I hope it will greatly benefit both our countries. Of course, the rate of expansion will depend on whether both countries see benefits for themselves in the Agreement. Mutual benefits must become apparent before either country will be prepared to proceed. I believe this will be a gradual process. I support the Agreement heartily and certainly oppose the amendment proposed by the Opposition.

Senator BENN:

.- I ask for leave to make my remarks at a later stage.

Leave granted; debate adjourned.

page 520



Ministerial Statement

Senator GORTON:
Minister for Works · Victoria · LP

– by leave - On 31st March I informed the Senate that the Select Committee on Constitutional Development appointed by the House of Assembly for Papua and New Guinea had been invited to come to Canberra for discussions on questions of constitutional advance. The talks began on 18th April and have now been completed. The Treasurer (Mr. McMahon), the Attorney-General (Mr. Snedden) and the Minister for Immigration (Mr. Opperman) joined the Minister for Territories (Mr. Barnes) from time lo time in the discussions which took place in an atmosphere of cordiality and frankness. The talks, which were exploratory in character, covered the whole range of constitutional development of the Territory. A good deal of attention was given to the Committee’s wish to discuss the range of special relationships between Papua and New Guinea and- Australia that might be acceptable to Australia at the time of self determination.

The Select Committee said that it wished to clarify what the long-term possibilities were prior to talking to the people of the Territory about what their wishes might be. The Ministers informed the Select Committee of the Government’s views. They reaffirmed that the Government’s basic policy for Papua and New Guinea is selfdetermination. lt is the prerogative of the Territory people to terminate the present Territory status and take independent status if they wish to do so in due time. Should the people wish to remain in association with Australia after self determination this would require the agreement of the Australian Government of the day. As far as the long term possibilities are concerned, and to the extent that decisions by Australia will be required, the Government concluded that any decisions as to the nature of possible future forms of association that would be acceptable to Australia should not be made now. They should be made at the appropriate time by the Government of the day in the light of the circumstances actually existing at’ that time.

The Committee explained the concern of the Territory people about the implications of the separate status of Papua as an Australian Territory and of New Guinea as a Trust Territory. The people’s uncertainty about how the separate status of the two Territories affected their constitutional future was a hindrance to discussion in the Territory. The people wanted to know in which direction they were heading before they could feel confident about giving opinions on the next steps of constitutional progress. Ministers expressed the view that the effect on the people arising from the difference in status between the two Territories was of little consequence now. The two Territories are administered as one, Territory people, whether Papuans or New Guineans, who travel abroad do so on Australian passports and are entitled equally to the protection of the Australian Government. Further, in the Government’s thinking, the difference in citizenship between Papuans and New Guineans would not lead to Papuans having a preferred position over New Guineans at the time of self determination.

Ministers and the Committee were of the opinion that it would be undesirable to seek any variation in the United Nations Trusteeship Agreement until such time as the Trust is discharged. Ministers gave an assurance that there is no intention to change the status of either Papua or New Guinea except in accordance with the wishes of the people of the respective Territory. Until self determination the administrative union and joint development of both Territories will continue. Until the Territory has moved further forward economically and the people are able through the spread of education to understand better the issues involved, the Government was willing to see the Territory continue in its present relationship wilh Australia as a Territory. This would not shut out progressive steps towards internal self government for the Territory, if the people wish it.

The Committee felt that it would be of value if the people of the Territory were asked to say whether they wanted constitutional development to take a course directed towards separation from Australia or whether they wished their constitutional development to take a course directed towards evolution of an association or relationship with Australia which will endure after self determination, recognising that the form of any such association or relationship would, so far as it affected Australia, be a matter to be decided by the Australian Government of the day. Ministers agreed that it would be compatible with the Government’s position for the Committee to ask the Territory people their opinions on this question.

The difficulties to be overcome in attaining the goal of internal self government were fully recognised. Ministers made it clear that the Commonwealth would stand willing and would desire to help the development of the Territory so as to reach this goal, as was evidenced by acceptance of the World Bank Mission report as a basis for planning. It would assist towards financial independence by progressively giving the Territory more financial autonomy as its capacity to contribute to its own revenues increases. It would wish to put more and more of the administration of the Territory in Territory hands by the development of the Territory Public Service and by enlarging progressively the measure of self government.

The Committee emphasised that its wish to discuss future possibilities should not be taken as indicating that the Committee considered that the pace of development should be hastened or accelerated. Ministers stressed that the Australian Government had no desire to press constitutional changes upon the people of the Territory which they do not want or for which they do not think they are ready. In connection with the next step which might be taken if there is a wish for such a move in the Territory, the views set out in my statement in the Senate on 3 1st March concerning possible changes in the form of Executive Government were discussed. Ministers affirmed that the Government stands ready to consider changes designed to make it possible for members of the House of Assembly to participate in the Executive Government of the Territory as a step towards self government. Certain responsibilities of a ministerial character could be passed initially to a limited number of elected members. Changes could also be made in the constitution and functions of the Administrator’s Council directed to the same end. It was recognised in the discussions that in present circumstances the final policy responsibility must remain with the Commonwealth Government.

The operation of the present system of under-secretaries was discussed. It is intended that all possible means of making this system more effective should be taken.

The possibility of changes in the composition of the House of Assembly in time for the next general election in 1968 was discussed and timetable requirements were studied. To make any such changes it will be necessary for the Select Committee to make its recommendations to the House of Assembly not later than . mid August this year so that a bill can be introduced into this Parliament to amend the Papua and New Guinea Act during the Budget session in time for the necessary electoral changes to be made.

The Select Committee stressed its view that the people of the Territory were fully conscious of the need for stability and the need to retain the confidence of people inside and outside the Territory who were interested in investing their money and their skills in the development of Papua and New Guinea. The Committee emphasised its view that any constitutional proposals should be based upon the acceptance of the basic principles of the rule of law. It was also recognised that after full internal selfgovernment has been achieved, a further period of time would probably be desirable to provide experience in the exercise of responsibility prior to self-determination.

There was a frank exchange of views on immigration. The Select Committee commented that it knew of no opinion in the Territory favouring a mass movement of people from the Territory to Australia and that the wish of many Territory people for a close association with Australia did not mean that a large number of Papuans and New Guineans wanted to come to Australia for permanent residence. The Committee was, however, interested to gain a greater understanding of Australia’s immigration policy.

Ministers explained that persons who did not have their home in the Australian mainland and Tasmania required a permit to enter Australia, just as Australians required a permit to enter Papua and New Guinea. While this might seem anomalous in the case of Papuans, who are Australian citizens, this was a situation not peculiar to Australia. Similar arrangements applied between other countries.

There are now 400 students from Papua and New Guinea studying in Australia. It was noted that as education became more general and as the development of the Territory progressed there would be increasing value in people of the Territory coming here to obtain skills to be used for the benefit of the Territory when they went back. Ministers foresaw no difficulty in this respect.

The Committee wished to know whether recent changes in Australian immigration policy applied to Papuans and New Guineans. The Minister confirmed this, but at the same time pointed out that if there were Papuans and New Guineans who had skills which were required ‘by Australia, these skills would, in the foreseeable future, be even more strongly required by the Territory itself. The Select Committee and Ministers both agreed that everything possible should be done to encourage Papuans and New Guineans who were able to contribute to the progress and advancement of their own country to do so, rather than seeking to further their own interests elsewhere. However, should Papua and New Guinea at some time build up a surplus of skills which were short in Australia then the entry of Papuans and New Guineans would be given special consideration within the recently revised policy.

The Select Committee said that it had appreciated the opportunity of discussing the political development of the Territory with Ministers. It said that it was now in a better position to obtain the views of the people of the Territory on matters on which action was required to be taken if changes were to be made in time for the next Territory elections. The Ministers, for their part, stressed that the Australian Government and people have, and will continue to have, a sympathetic, close, and practical interest in the progress and advancement of Papua and New Guinea.

Senator KEEFFE:

.- by leave - I move -

That the Senate take note of the statement.

I ask for leave to make my remarks at a later date.

Leave granted; debate adjourned.

page 523


Ministerial Statement

Debate resumed (vide page 520).

Senator BENN:

.- The Senate is discussing the terms of the New Zealand-Australia Free Trade Agreement. This afternoon we heard a clear explanation of nearly all the legal terms used in the Agreement. The purpose of the Agreement is to expand the trade between New Zealand and Australia so that trading affairs will be carried on smoothly. An agreement between the two countries was made in 1933 and for many years it met all purposes. Later it was found that the agreement had cobwebs on it and that to meet the requirements of the modern trading world it was essential to bring in what I might call a 1966 trade agreement. So we have before us the Agreement I have mentioned.

There were reasons behind the introduction of this Agreement that have not been stated. There were good reasons why Australia and New Zealand should make a new agreement. There is still the fear that the

United Kingdom will enter the European Common Market at some time in the future. That thought lives with us. There is the possibility that within the next year or two when tie United Kingdom enters the European Common Market, complexities will arise for New Zealand and Australia. Furthermore, at the conclusion of the conference on the General Agreement on Tariffs and Trade last year, the Prime Minister of the United Kingdom, Mr. Wilson, stated that he proposed to reduce tariffs by 50 per cent. The significance of that statement is appreciated when it is known that Australian and New Zealand products are admitted to the United Kingdom free of tariff charges. If the United Kingdom reduces its tariffs, Australian and New Zealand products will be severely affected on the United Kingdom market. One approves of the Agreement. New Zealand and Australia acted rightly when they drew up this new Agreement. It was not entered into quickly nor was it drawn up hurriedly. The Agreement was not cursorily examined by those whose responsibility it was to examine it.

The Agreement is the crystallised effort of the Australian Department of Trade and Industry and its counterpart in New Zealand. I should imagine that various conferences were held. There would be a good deal of correspondence and discussions between the representatives of the two countries before the Agreement reached its final form. There are employed in the Department of Trade and Industry in Australia a senior economist and other economists, a senior research officer and other research officers. There is a commodity policy officer and other officers to help him. A tariff policy officer also has officers assisting him. Last year when the Estimates were discussed we found that 86 officers were employed on technical work in the Department of Trade and Industry. The Senate voted more than £1 million to pay their salaries during the financial year. When officers of that calibre are given the task of preparing a trade agreement with a country like New Zealand it would be second nature to them to produce a document such as we have before us. I know that the Minister and the Cabinet had to make the final decisions about all these matters, but the spade work was put in by very efficient and experienced officers. They would be briefed on how to prepare the Agreement so as to produce certain results in respect of trade conditions in Australia and, similarly, with respect to trade conditions in New Zealand.

After the Agreement was publicised, both here and elsewhere, a gentleman named Mr. Eric Windham White, DirectorGeneral of the General Agreement on Tariffs and Trade, visited Australia on - I think - 19th February last. One of his functions was to scrutinise the Agreement to see whether it complied with the provisions of the G.A.T.T. organisation. After he examined it he had grave doubts as to whether it complied with all the requirements of G.A.T.T., and he stated publicly what he thought was wrong with the Agreement. However, after he had been in Australia for a week or two he announced that it had been found that the Agreement complied with all the requirements of G.A.T.T. So as far as international law is concerned Australia and New Zealand are quite free to commence the Agreement. The Agreement includes many items and covers 60 per cent, of the total trade now engaged in between the two countries. Of that 60 per cent, of the items now traded, some are traded at tariffs as low as 5 per cent., and it is proposed, under the Agreement, to waive the duty on items with such low tariffs, so there will be a greater volume of free trade carried on between the two countries in future.

One of the good provisions - of which I approve wholeheartedly - is that the Agreement will be kept under constant review by the two countries in order to ensure that no hardship is caused, as the result of the provisions of the Agreement, to any person engaged in industry and also to ensure that there is no unemployment, no hardship and no bankruptcy caused as the result of the operation of the Agreement. Those are provisions that we all endorse. This is the sort of thing one expects when countries of the calibre of Australia and New Zealand engage in a trade agreement. One expects them to act on the highest level and have consideration for each other’s troubles, and that is the position under this Agreement. To see the Agreement perhaps in its worst light one has to be a realist and examine some industries to see the effect of the Agreement on them. We all know that the dairy industry is important in New Zealand and that it is also a very important industry i’n the six States of Australia. We know that New Zealand produces more cheese, butter and other dairy products than its two million inhabitants can consume, and we know that in the six States of the Commonwealth more butter, cheese and milk products are produced than our 11 million people can consume. There we have an immediate problem, or what appears to be a problem because, with free trade operating between the two countries we are going to allow New Zealand to send her cheese into Australia. I have been told that the importing of butter from New Zealand is prohibited under some agreement or other, so I will not mention that commodity, but cheese and other dairy products are allowed into Australia.

I have highlighted the situation in regard to cheese and other dairy products and I move on now to deal with beans and peas, both of them items which have been discussed here this afternoon. It is true that in New Zealand more peas and beans can be produced than the population can consume and there are occasions when more peas and beans are produced in the Commonwealth than our 11 million people can consume. Once more there appears to be a problem, this time in respect of peas and beans. Our production of pig meats is fairly low, .and the figures over recent years show that no New Zealand pig meats were imported, as their importation is prohibited because of a disease present in the New Zealand herds. Our exports of pig meats to other countries are infinitesimal, not worth talking about, but the excess production of cheese and other dairy products over what is consumed both here and in New Zealand shows the necessity to look round for markets. We do permit New Zealand to send cheese and other dairy products into Australia. I went to the trouble of obtaining the figures showing the quantities of these products that we allowed to be imported into Australia during 1964. I did not take the figures for 1965, because that was a drought affected year, but the 1964 figures are interesting. In 1964 imports of processed cheese, including cheese pastes and cheese spreads, amounted to 9.104 lb. Other figures are: Cheese other than pro- cessed cheese, blue, 18,923 lb.; cheddar and epicure cheddar, 472,579 lb.; cheese not elsewhere included, 109,091 lb.; milk and cream 32,966 lb.; butter 3,920 lb. Pig meats were admitted to Australia in 1964, and the figures connected with them are: Pork, fresh or preserved by cold process, 3,286, 1 50 lb.; ham and pork shoulders, preserved in tins or other airtight vessels, 33 lb.; bacon and hams, partly or wholly cured, 82,770 lb. The figures relating to peas and beans imported into Australia from New Zealand in 1964 are: Peas, fresh frozen, fully packed, not exceeding 1 lb., 2,563,170 lb.; otherwise packed, 1,061,776 lb. We heard about dehydrated peas this afternoon, and in 1964 the figure for peas dried, not split, was 9,194 lb. We imported 554,709 Jb. of fresh frozen beans from New Zealand in 1964.

I shall mention what we exported to New Zealand in that year so that a comparison may be made. We imported some of its primary products and we exported some of ours to that country in that year. I shall inform the Senate what we exported to New Zealand in respect of cheese, beans, peas and pig meats. We exported 1,335 lb. of processed cheese, including cheese pastes and cheese spreads. We exported 1,641 lb. of sweetened milk other than buttermilk and whey, and fermented milk. In solid form such as block or powder, we exported 1,176 lb. of full cream milk and 3,851 lb. of skim milk spray dried, and we ako exported 216 lb. of butter concentrate, dry butter fat and butter oil.

That is the total of our exports of cheese, butter and dairy products to New Zealand in 1964. There was a positive imbalance in the trade in respect of the commodities which I have mentioned.

Now, the question arises as to what happens to the surplus. New Zealand has a surplus of the commodities which I have mentioned, and so has Australia. What is going to happen to that surplus? Both countries are forced to discover, if they can, a country in the world which will purchase those products from them. So we have the spectacle of New Zealand and Australia exporting their surplus cheese, butter and dairy products to the United Kingdom, selling them in competition with each other and with other countries that produce similar commodities.

It is worth noting that a small market for dairy products has been established in some of the Asian countries. In 1961-62, $17 million worth of products were exported. In 1962-63, $22 million worth were exported. In 1963-64, the products exported were valued at $24 million, and last year, 1964-65, which was a bumper year so far as Australia was concerned, $29.1 million worth of products were exported to the Asian countries. I have a proposition to put before the Senate. Here we have two countries which are close to each other. Sydney is roughly 1,000 miles from New Zealand. Each country is producing a surplus of dairy products. Each country, acting alone, is exporting that surplus to European countries. Is it not possible that the money that is being spent by the Commonwealth on sales promotion could be used to purchase surplus commodities from New Zealand which could be sold as Australian products or as a combination of Australian and New Zealand products?

Shortly I shall tell the Senate what Australia spends on sales promotion. I think that some action is warranted. There must be complete understanding between the two countries. If we can enter into a trade agreement of this description with New Zealand, it should be possible for us to put a superstructure upon that agreement so that we can act as one body and sell our surplus dairy products on the world market as a single body. There is nothing to prevent that from being done. A considerable saving would be effected. As Australia ranks as the major nation, it is hex responsibility to set this in train. But, first of all, Australia has to negotiate with New Zealand. Madam Acting Deputy President, may I respectfully suggest* through you that that proposal be passed on to the Department of Trade and Industry so that it may be thoroughly examined?

I pass on to other matters that are mentioned in the Agreement. A problem arises in respect of peas and beans because we have so many people engaged in the pea and bean industry in Tasmania. If we are going to affect the marketing of their products in Australia by allowing New Zealand to export to Australia unlimited quantities of peas and beans, to my mind it will certainly have a serious effect on the bean and pea producers in Tasmania. I see it as a definite problem at the present time. I will be delighted to hear what the Minister has to say about this matter. He may adopt the words of the Minister for Trade and Industry (Mr. McEwen), that these problems will be phased out within five or six years; that is, the countries will negotiate with each other in a certain manner and the problems will not exist after a number of years.

I mention at this stage that further problems will arise. Dams are being constructed in Queensland in bean and pea growing areas, and it will not be long before Queensland will be able to flood the Australian market with beans, at least, produced on thousands of acres of land. Two dams have been completed, and one will soon be completed. When that happens, industrious growers will use the bean growing industry as a second industry; that is, they will have one main crop - it may be tobacco - and they will be able to grow beans in the off season.

It is interesting to note the quantity of surplus products that we have exported to other countries over the years. I will not weary the Senate by mentioning all of the figures, but I refer honorable senators to the “ Quarterly Review of Agricultural Economics” for January 1965. If honorable senators look at page 60 of that publication they will get a picture of our exports over a number of years. It shows the quantity of wheat, barley, oats, rice, sugar and other commodities that we have exported. It also refers to mutton, beef, veal, pig meats, condensed milk, dried milk and so on. It shows what we exported in the pre-war years and what we have exported from 1958-59 to 1963-64. The figures will confirm my previous statements. In the pre-war years we exported 14,700 tons of pig meat. In 1963-64 we exported 200 tons of pig meat, which is infinitesimal. If the people had had more money to spend, they would have eaten all of the pig meats in that year.

The Minister for Trade and Industry has made some statements on the Agreement. He has commented upon the dairying industry. I know that he will not mind if I recite to the Senate some of the statements he has made. They are rather interesting. In this Parliament on 9th December 1965 he said -

There was no challenge to my assertion, which

I have made in the House, that if 100 tons of Cheddar cheese were brought in from New Zealand it would cause, at worst, 100 tons to be reexported from Australia, resulting in a maximum loss of one-tenth of one farthing per lb. of butter fat.

The Minister got that information from the efficient body of public servants in his Department and I do not doubt it for a second. Those people have gone over these things very carefully. That is what he had to say about the 100 tons of cheese and that only confirms the idea I gave to the Senate a short while ago. If we are going to bring excess quantities of cheese and other dairy products to Australia and we are going to produce excess quantities here, then what is wrong with having one single selling authority for it on the overseas markets? The Minister went on further and said -

  1. . the average production of milk per cow in Queensland is 301 gallons a year whereas the average production everywhere else in Australia is 513 gallons per cow.

I know that honorable senators are very conscientious and always do their best. Queensland’s cows are conscientious, too, and they always do their best.

Senator Cormack:

– There is not enough good grass in Queensland. That is the trouble.

Senator BENN:

– The honorable senator has hit the nail on the head. Queensland does not have the rich pastures that there are in parts of Victoria, New South Wales and South Australia. Furthermore, Topsy, Strawberry and all the other cows in Queensland are entitled to a siesta every day because of the climate. Cows in Victoria and the other States are able to spend their time eating beautiful lush grasses while those in Queensland are sleeping. I have been informed by dairy farmers that if you want the highest production from cows you must keep them eating and drinking when you are not milking them. The Minister for Trade and Industry made another interesting remark which I want to quote. He said -

The figures show that in the first two years of the New Zealand agreement the maximum loss that the average dairy farmer in Queensland could suffer would be 21s. for the year. I pointed out that the average dairy farmer in Queensland is receiving £245 a year voted by this Parliament under the policies of this Government. 1 thought that that was fantastic so I set about having the position examined in my own way. This is what I found. I am referring to my own work now. I turned up the report of the Auditor-General last year and this is what I discovered by examining special appropriations from the Consolidated Revenue Fund: Under the Dairy Produce Research and Sales Promotion Act 1958-1964, the sum of £281,510 was devoted to research and £262,769 was devoted to sales promotion. Under the Dairy Produce Export Control Act 1924-1963, £337,262 went to the Dairy Produce Fund. Under the Processed Milk Products Bounty Act 1962-1964, relating to an appropriation of £436,362, dairy industry extension services received £2,715. Now, so far as bounties under the Dairying Industry Act 1962 are concerned, the butter industry received £12,250,000, the cheese industry received £1,250,000 and special expenditure amounted to £336,033. The total involved in those Acts was £15,156,651. That money has gone to the dairy farmers of the Commonwealth. Therefore it is true that every dairy farmer in the Commonwealth has his name on the wages roll of the Government. Dairy farmers are receiving that money. I could not check this matter out fully. I could not ascertain the number of dairy farmers in Queensland who received a quota of that sum. The industry is certainly not in a nourishing condition when the Commonwealth Government is forced to pay out subsidies to it. If the Government is keeping the industry going by way of subsidies then it is worthwhile examining the situation in New Zealand to see whether the New Zealand Government is paying subsidies also.

I now refer to another matter .1 want to deal with. Why is it that we, 1 1 million people m a big country, can say, in effect, to New Zealand: “ We will allow you to send your cheese, butter, pig meats, dairy products, beans and peas into this country. There will be no tariff.”? This trouble started with New Zealand a century ago. Australia has been following a system of development whereby instead of having peasants, shall I say, we have tradesmen. We have secondary industries. It is worthwhile going back into history to see how

Australia saved herself from becoming purely a primary producing country. We have our secondary industries.

Senator Gair:

– We have a more balanced economy.

Senator BENN:

– Yes. This had an origin. I want to refer back to when our charter in this regard was instituted. I always refer to what I am about to say as being the charter for the Australian secondary industries. I refer to an article contributed by a journalist to a newspaper in Melbourne in 1861. The name of the journalist was David Syme. It is interesting in 1966, when dealing with an agreement of this nature, to refer back to this. We are talking about New Zealand, which is predominantly a primary producing country. We are hi the glorious position, not only of being a primary producing country, but of being a country that has innumerable secondary industries. In addition, we have almost unlimited quantities of minerals which will allow us to proceed with our development in the future at an even higher rate than in the past. But let me get back to David Syme. He said 105 years ago -

If we produce, in abundance, the raw materials of any manufactures, we should shape our internal policy so as to encourage the domestication of these manufactures amongst us, unless there is some inherent predisposing cause, permanently or temporarily, in the condition and circumstances of the country itself and of the people who inhabit it, which predisposing cause would prevent or render unprofitable the establishment of these manufactures. Thus, we produce tallow, wool and hides in abundance. It is then a question for consideration whether there is anything in the present state of Australia which should cause its inhabitants to set a ban upon any attempts here to manufacture these commodities respectively into cloth, leather, and the various articles into the fabrication of which tallow largely enters - such, for instance, as sperm candles, patent lubrication for railway-carriage axles, and other similar products; and thus give an impetus to the enjoyment of domestic skill or “ native industry “, as the phrase is, in the handicraftman’s arts of tailoring, boot-making, and other occupations of the kind. We cannot perceive that there is any one predisposing cause at work in this country to prevent us making such an attempt, and certainly none which should induce us to put a special ban upon that attempt. Nevertheless that is what we do, when we wholly expose any effort on the part of our fellow colonists here to localise any of these branches of industry to the overwhelming competition of the multitudinous inferior, low-priced (not cheap) articles made of refuse material especially for the Australian market, with which we are inundated from the crowded factories and workshops of the outer world. By this system of naked competition, our manufacturers or mechanics are prevented from even making a beginning in the* work of opening up new sources of industry amongst us. A ban is put upon the attempt from the very outset; and in a few short years hence, if this prearranged practice of national industrial abortion is continued amongst us, the people of Australia will be as utter strangers to all technical skill and practical dexterity in the arts and manufactures of highly civilized nations as are the Bedouins of Barbary, or the Tartars of central Asia.

Is that a desirable result? Is it desirable that, instead of carrying with us the arts of advanced civilization from the parent State in Europe to this remote land, we should purposely and, as it were, with malice aforethought, upon quitting the shores of that parent State, cast behind us and abandon the knowledge and the practice of those great industrial arts which have constituted and still constitute the sole groundwork of her characteristic preeminence in trade, commerce and wealth? Is it not on the contrary rather desirable that we should endeavour to perpetuate amongst us, in our new home, that civilising and enriching skill and trained industry which is a part of our national inheritance, and that we should try rather to rival than to fall behind that European progress in the midst of which we ourselves were bred, and up to the tone of which it should be our ambition, as it is for our profit, to train our children in this far off land?

That was written over .1 00 years ago. Today there is a huge difference between New Zealand and Australia. The difference has been caused by the application of tariffs through the progressing, developing period of Australia’s existence. It has protected its secondary industries. It has protected its manufactures. On the other hand, if we examine the whole history of development in New Zealand we see that it has failed to do likewise. The result is that today New Zealand is a land, shall I say, of peasants, and Australia is a fast developing land, with more than a fair proportion of good tradesmen. Let us continue in that way if it is possible. New Zealand is to buy our manufactures and we are to buy a handful of its primary products. If I were a member of the New Zealand Labour Party, I would fight this Agreement tooth and nail.

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– It must be a good thing for Australia, then.

Senator BENN:

– It will have a serious effect on some sections of producers in the country, for instance on the growers of peas and beans in Tasmania. It will affect dairy farmers and others to some extent, but they, perhaps, will be ushered out of their troubles. Their problems will be solved for them, and sooner or later, I feel sure, New Zealand will benefit from the Agreement as Australia expects to benefit from it. The Opposition’s amendment is for the purpose of affording some protection to sections of primary industry from the worst features of the Agreement.

Senator COTTON:
New South Wales

– One feels in this debate a little like a rider in a six day bicycle race. You have your head down, you are pedalling hard, and you see the same signs go flashing by. It is rather hard to develop any new material. We have heard a statement by Senator Henty, on behalf of the Government. Senator McKenna has moved an amendment, which deals not really with the broad issues of the Agreement but with certain particular problems of primary industries and only of some primary industries - not the broad primary industry field. I am grateful to Senator McKenna for his usual lucid, calm exposition. I enjoyed listening to him, as I always do, but I am sure that he will not mind my pointing out that the Agreement is of very great consequence to all of the Australian people, not only to primary producers who do stand, in the broad sense, to gain considerably out of the Agreement, as indeed do the manufacturers and the Australian people, wherever they may be employed or found.

There must be in agreements like this cases of adjustment. This has to be so. There must be cases of hardship. These things are not easy to deal with, but I do think that the Government has tried very hard to provide, both in this country and in New Zealand, safeguards that are adequate and to provide time for the necessary period of adjustment. I think it will be found that through the years, as long as we approach this thing sensibly, the safeguards exist and the time is available, for these consequential changes to take place.

Senator McKenna mentioned in particular certain, primary industries that were likely to be affected adversely. Peas and beans were mentioned. I am concerned about the effect on some producers of peas and beans but we have to bear in mind that it is possible for them to attain equal levels of productive efficiency with N.Z. producers, if lack of this is what they fear. There is nearly nine years in which to come to a period of, perhaps, equal cost, structures, equal attractiveness in product, equal packaging and equal new programmes. During the debate somebody said that the New Zealanders had a process that was unique to them, which allowed them to produce dried peas. It was said that the manufacturer would not allow anybody else to have the process. Subsequently we were told that Gippsland was to get it. I think that what we are talking about here - although, not having been there for a while and looked into this, I am not perfectly sure - is the accelerated freeze drying, or A.F.D., process. If we are talking about that, we are not talking about an exclusive patent that can go only to one country. We are talking about a known technical method of vegetable processing. As a matter of interest, the tea that we can now buy in powder form is produced by the same A.F.D. process. I doubt very much whether there is any exclusive right to New Zealand in handling this type of product by the A.F.D. process.

Senator O’Byrne:

– The Unilever organisation has a world patent on this particular process.

Senator COTTON:

– And declines to make it available to Tasmanian processors?

Senator O’Byrne:

– Yes. It will not necessarily introduce the process in Victoria. It has a pilot station there to see how peas will grow, in order to decide whether the process will be introduced.

Senator COTTON:

– It must always be a matter for concern to a primary producing country if a technical innovation is denied to it. I agree that that would not be a good thing. In any case, quite apart from this Agreement, our job is to get the best technical methods we can get and have them available. It is important to bear in mind in relation to this processed vegetable operation, whether the vegetables are dehydrated or frozen, that we still have a trans-Tasman freight advantage in our hands. It may not be of great consequence, but it is an advantage. Somebody has stated in the debate that the Australian production of pig meat amounts to 120,000 tons per annum. As I read the Agreement, it is proposed to allow in 3,000 tons, which is equal to about 2i per cent, of the Australian production. This is to be allowed to grow at the rate of about 5 per cent, per annum.

Our own growth rate is 5 per cent, per annum. So I do not really think that this proposal will be a tremendous hardship to the Australian people as a whole, although I do accept the fact that difficulty will be experienced by individual producers. However, I hope that the time available will be sufficient for them to make an adjustment, with the help of the Australian community in one form or another. It does not seem to me to be a matter of sufficient importance to destroy the framework of the Agreement.

We produce a large volume of cheese. There is a severe restriction on imports of cheese. A total of 1,000 tons is allowed in. Our local production is 60,000 tons per annum. I mention these matters because Senator McKenna raised them as issues in support of his amendment, and very properly so. However, I suggest that they are not really important enough to warrant setting aside the Agreement, which has such content for the Australian people.

The Agreement has been called a free trade agreement. I am not at all sure that it is strictly a free trade agreement. I believe the use of the term flows from the history of the whole business, which more or less began when the argument about the European Common Market was at its height and when New Zealand was very frightened that the United Kingdom was going to join the Common Market. We were frightened too. We decided to consider a free trade proposal. As time went by and we realised that our demands would not quite justify entering into such an agreement, and after discussion, the proposals were considerably modified. I suggest that we really have not a free trade agreement but that what we really have is an intent, with the passage of time, to have a free trade agreement. To my mind, this is a consequential matter. It has not been brought out in the debate, but as a rider in a six day bike race I am pleased to be able to put a new sign on the track. I suggest that what we have is a modified trade agreement which we hope may well become a free trade agreement in time.

In real terms the Agreement covers 60 per cent, of the trade of New Zealand and Australia. It covers 51 per cent, of our exports to New Zealand and 85 per cent, of our imports from that country. These facts have been mentioned by many other people. I ask honorable senators to excuse me for mentioning them again, but it is necessary for me to do so to develop an orderly pattern of discussion. We have been able to negotiate the Agreement with the concurrence of those concerned in the General Agreement on Tariffs and Trade, lt can well be said that it has been received with modified rapture. It is hoped that the Agreement will develop into something that is greater. I think we must contemplate the possibility that as a Senate we will continue to debate applications for enlargement of the terms of the Agreement. If it remains as it is, surely the time will come when G.A.T.T. will not recognise it.

A review is due in 1967. People in Australia or New Zealand will then be able to apply for the inclusion of new items. One thing we can be doing is looking at the possible extension of the Agreement to include new items for Australia to export to New Zealand and for New Zealand to export to Australia. This possibility is covered by paragraph 3 in Article 4.

Above all things, I should like to congratulate the Australian negotiating team. A first class job has been done by the negotiators of the Department of Trade and Industry and by the Minister for Trade and Industry (Mr. McEwen) on behalf of the Australian people. I am still allowing for the fact that there will be individual cases of hardship, which I recognise and understand. But I repeat that the negotiators did a first class job. I had something to do with some parts of the negotiations. I watched these people at work, and I came away with a very great admiration for Australian public servants, particularly in this field. I thought the Agreement was a great achievement. Like Senator McKenna, I believe that the document has been very well drawn and that it represents an effort to cover the full ambit of the problem.

I am really concerned about four aspects of the Agreement and the discussion upon it. They are these: First, the effect of the Agreement on Australia as a whole; secondly, the negotiations and the broad thinking that led up to the Agreement; thirdly, the broad effect of the Agreement on Australia; and fourthly, the effect on industry in particular, and still more particularly on the forest products industry which, from the Australian standpoint, is carrying the great burden of the concessions. If we look at the Agreement from the standpoint of one country as against another, I think it is fair to say that New Zealand has more to be concerned about than we have. Honorable senators may not think so, but I think that time may well prove that the New Zealand concessions have been, if anything, more substantial than ours, if we have regard to our country and its growth and opportunities and to New Zealand and her growth’ and opportunities. Despite the manufacturing problems New Zealand may experience and the challenges she may face in seeking amendments of the Agreement, that country has joined in without any tendency to pinch things. I suggest that New Zealand has made more concessions.

If we look at the Agreement from the standpoint of Australia as a whole, we see a number of things that are of importance. First, I continue to remind myself - I hope honorable senators will not mind my reminding them too - that Australia is a trading nation. We are one of the top ten trading nations of the world. Within our ability to trade - that is to grow primary products, to produce goods and to sell them - we are really trying to do two things. At least, my concept of what we are trying to do is that we are trying to grow and defend ourselves, and to maintain our living standards. To do those things we must maintain our exports and must have some reserves for security and fluctuations in a trading pattern that is followed by a big trading nation with a relatively small base. It is probably common knowledge that in the last year or so our reserves have declined. Being a trading nation, being a primary producing country which experiences seasonal fluctuations, and being a country that is following a long term growth programme, we must have reserves. Our trading pattern is bound to fluctuate. Any comment about a stop and go policy has not much validity. Irrespective of which party is in office, these are the facts of economic life in a country like Australia. Our export pattern runs like this: Wool accounts for 33 per cent., wheat for 13 per cent., meat for 11 per cent., foodstuffs for 16 per cent., minerals for 15 per cent, and manufactured goods for 12 per cent. Our exports have a high content of pro- ducts from the land and a growing content of manufactures and minerals. It is very important to find a new and growing market for minerals and manufactured goods, which now account for 27 per cent, of our exports.

We import certain commodities. Our import bill is becoming greater and more difficult to reduce. If you reduce your import bill, you tend to diminish your living standards and to slow your growth. Commodities account for 22 per cent, of our imports, machinery for 25 per cent., textiles for 9 per cent., food, drink and tobacco for 5 per cent., and manufactured goods for 39 per cent. This is the way we live, the way we export and the way we import. Our trade patterns in a multilateral trading world are not quite consistent. We have an adverse pattern with the United States of America, the United Kingdom and Canada. Historically, this pattern tends to be worsening. Our favourable trading areas are the European Economic Community, the Union of Soviet Socialist Republics, Japan, Asia and New Zealand. New Zealand is of particular importance to us. Although the New Zealand market is not great in size, it is very important to us. In 1945-46 exports to New Zealand were valued at £8 million, and imports from that country were £3’.2 million. In 1964-65 exports were £79.3 million and imports £23.3 million; the balance against New Zealand was £56 million, representing a worsening of trade between this country and New Zealand in our favour by 11 times in 20 years. This is the sort of way trade has developed between these two countries. If we are not careful, certain misunderstandings, recriminations and hard feelings could arise. These things happen. With the concurrence of honorable senators, I shall have incorporated in “ Hansard “ a table showing Australia’s export and import trade with New Zealand.

As I have said, in our trading with New Zealand the balance in our favour has increased by 11 times in 20 years, so that today the balance in our favour is £56 million. This is part of the living standards of the Australian people and our growth, and we are anxious to maintain that position.

Our trading pattern with New Zealand has developed in a certain fashion. Our exports to New Zealand comprise foodstuffs 15 per cent.; machinery and metals 45 per cent.; oils and fats 15 per cent.; yarns and fibres 4 per cent.; and miscellaneous 16 per cent. On the other hand, our imports from New Zealand comprise paper and pulp 53 per cent.; animal products 9 per cent.; foodstuffs 7 per cent.; fibres, &c. 5 per cent.; wood and wicker products 5 per cent.; and miscellaneous 21 per cent. About 58 per cent of our import bill from New Zealand represents forest products. I apologise to the Senate if I am repeating figures that other honorable senators may have cited, but it is necessary that I do so in order to develop my argument.

As to negotiations and the broad thinking leading to the signing of the Agreement, it’ received its stimulus from the application of the United Kingdom to join the European Common Market. Countries like Australia, New Zealand, and to a lesser extent South Africa - all members of the outer sterling bloc - began to realise that there were some naked considerations of self interest motivating the trade patterns. We realised that although people were fond of us, they were not so much in love with us that they would ignore their own interests in our favour. We were becoming more exposed from a defence point of view, as well as from a trade point of view. Naturally, Australia and New Zealand decided that we must draw closer together. I imagine that that is how the trade talks got their real impetus.

When we began to discuss these matters as two countries living in the same part of the world, with the same problem - in our case, of much less magnitude - we realised that we were two similar countries with much in common. We are both exporters of the products of the land. We are trying to develop as manufacturing countries and to maintain high living standards. We were trying to reach a situation where we could help each other. This is not at all easy, because with two similar countries it is very hard for each country to make gains at the one time. New Zealand has become a very important market for Australian manufactured products. We were seeking to expand our manufacturing business. New Zealand was importing half of our manufactured products and was a great proving ground for export manufacturers. New Zealanders are people like ourselves. We have a common language and they understand us. Our products would go there and be proved. It was a good starting off point.

There has been a preference in trade between Australia and New Zealand since 1933. It grew out of preference negotiations between the United Kingdom and Australia in 1932. It was extremely important at the time that this Agreement was being negotiated for us to maintain our preference with New Zealand and to maintain our trading balance. If the Agreement were to do no more than maintain for 10 years our favorable trade balance of £56 million, that would be quite something. If agreements of that nature could be negotiated with all our trading partners with whom we have favorable trading balances so that the present margin could be maintained for 10 years as a floor level - as an amount below which the balance was not to go - we would not be doing badly. This is why I suggest that the Australian end of the trading with New Zealand has not been without its good points.

It was importaint for us to achieve continuation of our preference and, so far as we could, maintenance of our favorable trading balance. It was important also to maintain our ability to improve our trade balance, and not to allow it to worsen. New Zealand, on the other hand, has to negotiate trading agreements with the United Kingdom. It is important for us to negotiate with New Zealand prior to that country negotiating with the United Kingdom. I think all honorable senators will realise that that is common sense. New Zealand has its own trading difficulties, as we have. Its balance of payments difficulties tend to be greater than ours because it depends more than we do on primary products and its reserves position is not as strong as ours.

Senator Hannaford:

– It is very bad now.

Senator COTTON:

– It happens. We must be fair and understand that these are problems that must be faced by all countries like Australia and New Zealand. Discussions began on the basis of a consultative committee between the Australian department concerned and the relevant New Zealand department. Although I was never a party to any of the discussions, from time to time I have had talks with people who were involved. I do not think that anyone need worry about the capacity of Australian negotiators to walch the interests of the Australian people. I am told that they manage to hold their end up very well. When certain levels of agreements were reached, ministerial discussions were held and the areas of agreement were ratified in the Agreement. In the first ministerial discussion it was agreed that both countries had to protect certain areas of the primary and manufacturing industries. It was necessary for them to protect their growth and to learn to live together. Substantially, the forest products industry in Australia would have to agree to some modifications and to permit willingly imports from New Zealand. New Zealand manufacturers would have to agree willingly to allow some of Australia’s manufactures to enter that country. That is the broad basis; that was the understanding. That was the area around which agreement could be negotiated.

The Australian timber industry might have said: “We will not agree. We will fight to the very end. We will go stumping around the country kicking up all sorts of strife. We will not agree.” Had that happened and had the Government listened, the Agreement would have had no real foundation for existence insofar as concessions between Australia and New Zealand were concerned. The same is true of New Zealand manufacturers. So there has been an area of industry goodwill as well as good negotiating at quite a number of levels.

Senator Wright:

– What benefit does the New Zealand timber industry get as to access to the Australian market under the Agreement?

Senator COTTON:

– Quite a substantial benefit. At a later stage I will suggest that the Senate might agree to have incorporated in “Hansard” the duty structures as they were and as they will be in the phase out period. It may prove to be useful. New Zealand will have better access to Australian markets, notably in forest products, and we will have better access in some manufactures. We also need to remind ourselves that we have a common defence obligation, a common heritage and a common language. We are bound together in this part of the world. I believe that anything which tends to bind us together in our common interest is worth working for.

The broad effect of the Agreement as it could be in the future is something about which one cannot be certain, but one can comment on certain aspects. One very important aspect is that we have a market enlargement. The population of Hi million people of this country when added to the New Zealand population of 2i million provides a market of 14 million people for 60 per cent, of our trade. It is a market enlargement for New Zealand as well, as it is for us. This is not without its consequential benefits for the manufacturers of various products in both countries. It is a growing market enlargement which is a matter of great importance, although it is small alongside the effect of the market enlargement in Europe. However, honorable senators should be under no misapprehension as to the importance of a market enlargement to this country with a range of trading partners working together. It is of benefit not only to this country, but also to our trading partners. With a market enlargement there is a tendency for a multiplier to operate, which is very important. New Zealand and Australia are, in effect, joining together in trade as partners for 60 per cent, of our trade. It is as if New South Wales and Victoria for years had had a tariff structure between each other and had decided to abolish it and become trading partners. We have become a trading partner with New Zealand to the extent of 60 per cent, of our trade. To that extent we have to be prepared, both of us, to consider actions against third countries which will be to our benefit.

In this Agreement the previous duty free trade is still duty free. Certain minimal duties have been removed. In most cases duties which are of consequence are removed in five equal steps beginning on 1st January 1966. Although there is hardship - I have had to deal with a group of industries which will suffer some hardship - there is time to adjust and, in the broad interests of the Australian community, those people who have been adversely affected are entitled to have time to adjust and to have understanding, but I suggest they are not entitled to set the Agreement and its broad intent to one side. I mentioned earlier the problems associated with peas and beans and I will not do so again except to repeat that in 1967 the opportunity exists for producers of various goods in both countries who wish to enter the Australian and New Zealand trade, to go to their Government and seek to have particular items included in the areas of discussion and negotiation.

The limner industry in particular is concerned in a number of ways but it has to face up to certain realities of its own life. They are these: First, Australia faces a substantial and growing bill for timber imports. This will not be overcome for quite a number of years by the afforestation programme recently agreed to. For quite a number of years ahead we face a growing bill for timber imports. For quite a number of years ahead New Zealand will have a growing volume of timber available for export. On the proposition that we work as partners and. together as against third countries, it is impossible to deny that New Zealand should have priority for timber purchase over timber supply from the west coast of America or Canada with which countries we both have unfavourable balances. To import from New Zealand her surplus to match our timber deficiency does not upset our own forestry programme. It has not been set to one side or Altered. I understand that by about 1990 New Zealand is likely to pass out of having any real export surplus of any consequence.

In the area of forest products, the sawn timber producers who were excited about this problem when it first began came to realise that it was really the paper and pulp organisations which were bearing the great burden of the area of altered trade. They realised this was essential and wise. They had a better chance to get their pulp and paper from New Zealand than from Sweden and America and they set their own house in order. This has been achieved quite sensibly and, I think, in the interests of both countries. Sawn timber that was duty free is still duty free. The duty areas have been reduced. With the concurrence of honorable senators, I will incorporate in “ Hansard “ a table setting out the duty structure. It may be useful to honorable senators who have these matters raised with them.

As well as this, there was another consideration, which was taken into account by the Department of Trade and Industry on behalf of the Australian timber industry and the Australian people generally. An attempt was made to protect the Australian industry to the extent that it was a processor of wood. In effect, if someone was in the business of buying raw wood and had a processing business, an attempt was made to give him enough time for adjustment. I think this was fairly achieved. However, Australian timber producers who have some unique timbers found in the Agreement export opportunities open to them that were not available to them previously.

Some States, particularly Tasmania and Western Australia, have opportunities open to them for the export of their native timbers to New Zealand. These markets were not so readily available to them previously.

Senator Hannaford:

– Only hardwood.

Senator COTTON:

– Yes, but specifically for New Zealand’s particular use because New Zealand does not have much hardwood of its own. A market in plywood also became available. New Zealand undertook to remove entirely quantitative restrictions on the import of Australian timbers. This was written into the Agreement and referred to in the letter exchanges which took place on 3 1st August. In a letter from the Australian High Commissioner in New Zealand to the New Zealand Minister of Overseas Trade, the following appears -

  1. Article 5, 2. (iv). - In respect of timber products, as defined in the Annexure to this letter, neither Member State shall apply quantitative import restrictions against imports from the other Member State.

This has just been, in effect, invoked because New Zealand, in view of her recent balance of payments problem, had to cut back her import bill, but those honorable senators who have followed this subject will know that timber has been excluded. This was very important for the Australian timber exporter whose product went to New Zealand. He previously had quantitative import restrictions imposed upon him. According to the exchange of letters, this will not happen in the future.

The letters have been written into the Agreement and have been mentioned by many people. Senator McKenna dealt with them in some detail and that was of great value to me. The particular articles in the Agreement are wide arid all-embracing. Article 5 relates to quantitative import restrictions, Article 7 to the deflection of trade, Article 8 to the development of industry, Article 9 to temporary suspension of obligations, Article 10 to dumped and subsidised imports and Article 16 to consultation and review.

Another particularly important area of protection of the timber industry which was covered in the letters exchanged but not in the Agreement itself is mentioned at the top of page 38 of the Agreement. It was agreed that the two countries would have a joint consultative council on forest industries because both countries wanted to be quite sure that their public investment programmes were matched. We would not try to grow more wood than we sensibly should. We would take into account that New Zealand had a surplus. We took into account when that condition would end. On the other hand New Zealand would take into account that we would grow some of our own wood. It was no good New Zealand growing more wood than she could sell to us. The proposal is a good one which will come to mean something as time goes on.

In this Agreement we begin to learn to live in this multilateral trading world. This is a land mark in the development of Australia’s trading agreements. I oppose the amendment for the reasons I have given and I support the motion before the Senate.

Senator DEVITT:

.- I rise to support the proposed amendment, the terms of which have been indicated to the Senate by Senator McKenna. I do so primarily because my Party, having studied these proposals and having taken the opportunity to consult with those- engaged in and in other ways concerned about the welfare of certain industries, believes that there will arise a serious threat to the stability of some industries with the phasing out of the protective tariffs which now favour them. I am aware that the Agreement sets out to embody in its terms a number of defined safeguards. However, the safeguards are of such a nature as to give rise to serious doubts about the possibility of their implementation before an industry is virtually crippled.

Senator McKenna has given for the Opposition a broad interpretation of the terms of the Agreement as we see it and as it is seen by industries, organisations and bodies which operate primarily in the interests of primary producers and have been closely consulted throughout on this Agreement. Specifically, our chief objection is to the removal of the protective cover on four main commodities, namely, frozen peas, beans, cheese and pig meats to which Senator McKenna referred in his opening remarks.

The Labour Party is not opposed to the negotiation of such trading arrangements as are believed to be potentially mutually beneficial having regard to all the considerations necessarily involved in such matters, but it is bound to take a proper stand against any arrangements which may damage or endanger the existence of an industry which is vital in the Australian economic picture. After a great deal of consideration and study of this matter, we feel that the measure now before the Senate provides the means, intentional or otherwise - I suggest otherwise - of creating a good deal of chaos and consequential financial loss to a great many people. Let me reiterate that agreements of the kind we are considering can be highly desirable. We should do all we can to strengthen the already close ties we have with New Zealand when we have so much in common. Some little time ago I had an opportunity to visit New Zealand, which is a beautiful country. I was most impressed with what I saw. New Zealand has a tremendous agricultural potential. There are vast tracts of arable, highly fertile country and it has other features such as climate which particularly favour primary industries.

However, I say with equal emphasis that it would be irresponsible and foolish to enter upon any course that might bring disaster to our relatively new and rapidly developing industries through the impact of this Agreement, and I want to put certain propositions to the Senate in justification of the stand the Opposition is taking on this matter. In particular, I want to deal primarily with the position as it affects Tasmania. It is noteworthy that Tasmania will feel the impact of this Agreement probably more than any other State of the Commonwealth. The first consideration is the perennial problem of shipping which has been dealt with so many times in the past and to which I have referred previously in two speeches in the Senate. The shipping problem causes so much concern and expense to potato growers in Tasmania that it contributed, with other factors, to a serious decline in the potato industry.

I have referred to this matter before and do not intend to canvass it fully again. Suffice it for me to say that the farmers in Tasmania who were engaged mainly in dairying saw in the serious decline in potato growing the virtual drying up of a valuable source of ready income which had aug mented their returns from dairying. In* creased costs denuded the value of incomes from dairying and added to their problems, and because the size of their holdings was generally inadequate for an expansion of their dairy herds, small farmers, in the absence of other income, were forced to sell their holdings. As a consequence, they migrated to the cities and the larger provincial towns. It strikes me as odd that in a day and age when’ we deplore the drift to the cities and more populous areas, we are set upon a course which can lead only to an acceleration of this trend.

The price of butterfat has remained virtually static for the past 10 years. I might be incorrect in saying this, but I believe the price that is being paid for butterfat at present could be lower than the figure for 1955. So in terms of dollars and cents, the actual return to dairymen per lb. of butterfat is no greater now than it was 10 years ago, and probably it is slightly less. It has remained static, and with the erosi’on of the value of money, returns in terms of purchasing power have declined alarmingly.

So there was jubilation in Tasmania 15 years ago when a new industry for the canning of peas and later of beans was launched. We now have a valuable pea and bean processing industry in Tasmania. I hope the Senate will forgive me for directing my remarks mainly to the Tasmanian position, but the New Zealand-Australia Free Trade Agreement will have a very serious effect on quite a substantial section of Tasmanian primary industry. When pea growing was commenced, it represented more or less an experimental project initially and the area sown to edible peas was relatively small. But it was found that Tasmania had a type of soil and rainfall generally suited to this kind of agriculture. Now some 15,000 to 16,000 acres of land is under cultivation and sown to peas and beans annually. About 15,000 acres is sown to canning peas and approximately 1,000 acres to beans. Last year the industry employed about 920 growers of peas and about 100 bean growers. Between them, they provided employment for 1,700 to 2,000 seasonal workers besides those permanently employed in the canning factories, as well as outdoor labour - paddock labour if you like - and a good deal of less direct employment. The industry represents a substantial monetary investment in factories and processing equipment. There has also been a considerable investment of capital by farmers in plant, equipment, seeds and fertilisers. Many primary producers have term loan commitments on the strength of their cash crop returns and any change in their position could have widespread repercussions for them. That is logical.

Naturally when farmers engage in a new form of agriculture there is a demand for new agricultural machinery. New processes are involved and every phase of agricultural production is affected. A farmer who engages in a new branch of agriculture is immediately faced with problems of capital equipment and so on. Once his position is established, any challenge to it can be very serious for him, particularly in the field of finance. 1 invite the Senate to take full cognisance of this fact in assessing the merits of the case I am putting on behalf of the Tasmanian pea and bean industry and also those persons engaged in the production of pig meats and cheese. It must be recognised that the dairy industry is equally involved in the production of this comparatively small cash crop of peas and beans. The dairy industry is also associated with the production of pig meats and cheese. So this industry may feel any of the repercussions from the implementation of the Agreement.

This is by no means the end of the story, however, because trade and commerce in fairly extensive areas have been stepped up to meet increased local activity generated by the new industry. Local trade and commercial activities have been expanded. Schools have been provided where there has been increased population. A new industry generates fresh activity in the district where it is established, and any threat to that industry causes serious repercussions all down the line.

Many indirect benefits arise from a new industry. In this case, it is well known that the growing of leguminous crops improves the soil and results in increased production. Some years ago I studied agricultural science and learnt of the value of leguminous crops in a system of rotation, resulting in increased productivity. So while we are concerned now with the immediate effects of the Agreement on the pea and bean industry, there are other phases of production which will be affected indirectly.

I have said that the area under peas and beans in Tasmania is about 16,000 acres. From this area approximately 60 per cent, of Australia’s total output of canned peas and beans is produced. This is a substantial figure, and it emphasises the point I am try* ing to make: That the consequences flowing from the implementation of the provisions of this Agreement will have a more serious affect on Tasmania than on any other State.

As I have said, from this area 60 per cent, of the total national production of canned peas and beans comes, but expert opinion indicates that the potential has been only half realised by working on a basis of rotation of something like three years and that some 32,000 acres can ultimately be sown to peas and beans. I think the practice at present is to grow a crop of peas and not to go back to that paddock again for three years. However, recent breakthroughs in agricultural science indicate that it is quite possible to grow peas on the same paddock year after year with no consequent damage to the fertility of the soil and its productive capacity. The rate of increase in sown acreage is, to a large extent, determined on existing but ever expanding factory development, involving greater and greater capital outlay through all phases of this industry. The growing of peas and beans has, to a very marked degree, provided a cash crop alternative to potatoes and swedes, from which small farmers in past years were able to maintain themselves and their families on their properties and which spared them the difficult decision on whether to sell out.

It is by no means unusual to find the farmers taking part time work in secondary industry or working on roads or in various other fields of endeavour because, being on relatively small holdings, they have reached the maximum output from dairying and so on, and find that the returns - this is becoming increasingly evident as the years go by - are insufficient to maintain them in a reasonable degree of comfort and security. They are therefore compelled, under existing economic conditions, to get away from the farms for as long as they can during the course of the day so as to augment their incomes in industry and in various other ways. Whereas in the past they could make a reasonable living from dairying and cash cropping, the position has gradually worsened from year to year and the time may come, in the foreseeable future, when their position is no longer tenable and the age of the small farmer will be past. Dwelling on that for a moment; there seems to be a fairly broad consensus that the sooner the small farmer goes the better. I do not agree with that. As I have said before, the basis of society is the preservation of the family unit, and in the past the small farm provided the means for the fulfilment of this very desirable objective.

The time has now come when these farms will no longer sustain a family, and difficulties are arising in rural areas where the farmer and his wife carry on the farm activities, both of them working for long hours. I am talking now primarily about the small farmer, whose farm can no longer sustain all the members of the family in the way in which they have been used to living. Because of the economic difficulties, which are increasing all the time, we are now getting to the stage where the farmer and his wife must sell out and take jobs in a city or town while their holdings come under the control of some big operator. I think honorable senators will agree that this is a most undesirable trend. We are constantly hearing about the undesirability of the drift to the cities. I believe a majority of the population of Australia is now concentrated in the five main cities. This is a most undesirable trend and is certainly against the interests of the country. It could become a national tragedy. It is already moving towards that stage, and rather than raise further obstacles for the industry I think we should be searching for means to ensure for the small farmers a continued pursuit of the way of life they have chosen and in which they can give the nation valuable service.

I remind honorable senators that Australian primary industry is already carrying the lion’s share of the burden of financing the import of goods with which to service the nation’s growing secondary industry. For the life of me I am unable to see that the destruction of any section of any primary industry can be justified in these circumstances. It has been pointed out on many occasions that New Zealand enjoys soil and climatic conditions which give that country a tremendous advantage in the growing of agricultural commodities. I think also that the fact that New Zealand is forced to rely to a large extent on primary industry probably promotes her technological advance to a stage of sophistication where in many directions she can outdo Australia in the field of primary industry.

Senator Cotton referred to the shipping freight differential. It is interesting to note that the difference in the cost of shipping freight from ports on the north west coast of Tasmania to Sydney and from ports of export in New Zealand to Sydney is only 5s. 6d. a ton in favour of the TasmaniaSydney trade. A pea produced in New Zealand, and which poses the greatest threat to the Tasmanian industry, is that which has been treated under a particular process and is dished up as the “ Surprise “ pea. It is a delightful article. I have tested it and was surprised to find that when put in water these peas are just like peas picked fresh from the garden. It is a very good product and poses a quite serious threat to the Australian industry. As I have said, the cost differential in freight from New Zealand to Sydney and from Devonport to Sydney is only 5s. 6d. in Australia’s favour. New Zealand also enjoys a substantial wage level advantage which has been stated to be in the vicinity of 29 per cent. This is a very considerable factor in enabling New Zealand to produce primary products and sell them in Australia at rates competitive with those charged for the Australian produced article.

Senator Wright:

– Can the honorable senator tell us to what extent the New Zealand farmers enjoy concessional rates on government loans?

Senator DEVITT:

– I cannot answer that question, but I know that the New Zealand wage level gives that country a 29 per cent, advantage over Australia.

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– Would not the exchange rate cancel or nearly cancel out that advantage?

Senator DEVITT:

– No. This is a properly equated figure which gives New Zealand a 29 per cent, advantage. This factor was pointed out to the Minister for

Trade and Industry in quite clear and unmistakable terms by representatives of the Tasmanian pea and bean growers - and I believe also by their counterparts in Victoria - both in conferences with the Minister and departmental heads and in written submissions on different occasions. But for reasons which only the Minister seems to know, their pleas have fallen on deaf ears. Anyone concerned with these industries would have realised that an immediate threat to their future prosperity would be posed by pursuit of the course that the Minister has taken - that is, the inclusion of these items in the Agreement. I sound the warning, that under the express terms of the Agreement as to consultation and so on, serious damage has to be evident in the industry before any sort of protective action can be contemplated. As I said at the outset, neither I nor my Party would agree that there are not some desirable features in the Agreement’ and that their implementation would not be beneficial to ourselves and to New Zealand.

This is a desirable thing. I think it is quite proper that we, having so much in common with New Zealand, should endeavour to extend the ties which bind us by way of trade and treaties of one kind and another because we have a common heritage, a similar origin and, I think, a similar destiny. So it is desirable that we in Australia should be endeavouring to extend and cement the ties between our two countries with mutually beneficial results. We know that at the present time the balance of trade runs very strongly in Australia’s favour. It is something like 31 to 1 in our favour. We are aware of the fact that if imports are at a level at which no change will be done to our industries, they will, by the same token, be of little benefit to New Zealand.

This question of damage arises again. The Agreement provides that where damage to an industry is likely to occur, certain consultations will take place with the object in mind of cutting out the importation of the article which is seriously damaging the article in the other Member State. Surely this fact is the thing which, in the absence of a clear explanation, leads us to the reasonable conclusion, I suggest, that for the Agreement to be of any benefit to New Zealand, the imports will have to be quite considerable. In view of the present trade balance between the two countries, 1 cannot imagine that the importation by Australia of a very small quantity of a particular item will be of any great benefit to New Zealand.

Primarily the Agreement sets out to try to bridge this tremendous gap in the terms of trade as between the two countries. The general trend of negotiations seemed to those taking part in them to suggest that the Minister would be most reluctant to take action to hold imports once they commenced to flow in any substantial quantity. This is one of the greatest concerns of the industry.

I have pointed out to the Senate the relationships which exist between dairying, bean and pea growing, and the production of pig meats and cheese. AH four commodities virtually come into the one field of farming operations. I think that for this reason, particularly bearing in mind the peculiar case of Tasmania, we, as a responsible House of the Parliament of the nation, cannot stand idly by and allow an agreement to come into force which will damage substantially and could possibly ruin an essential industry. As I represent Tasmania, I am totally opposed to the implementation of any agreement which would have this effect on an industry in my State.

As I said before, I know that agreements of this nature are good. I know also that from New Zealand’s point of view, many responsible people in that country have expressed misgivings as to the ultimate benefit of this Agreement to it. The opinion has been expressed that as Australia has natural advantages in raw materials, the Agreement could cause New Zealand to put off the pursuit of a steel industry. This matter is very important to New Zealand. At the present time New Zealand is exploring the possibility of the development of a steel industry based on beach sand, iron stone and so on. It might be some years before this proposal comes to fruition. As I understand it, the New Zealand Government has not made any decision as yet to proceed with this type of industry. Until it does, and until it reaches a degree of self supporting in the production of this raw material, Australia is bound to have a tremendous advantage over New Zealand in this field.

I also suggest to the Senate that while we are unhappy - and I think this is the way in which to express it - about the fact that the balance of trade runs so strongly in our favour, we have also got to take into account the fact that it probably suits New Zealand to buy many commodities from Australia. I refer to those commodities which, if New Zealand did not buy them from Australia, it would be. bound to buy from somewhere overseas.

Senator Dittmer:

– At a higher price.

Senator DEVITT:

– That is so. While New Zealand suffers this disadvantage of having an imbalance of trade, the blame cannot be placed entirely at the door of Australia. As SenatorDittmer has pointed out, we may be assisting New Zealand to conserve some of its overseas funds by being able to supply commodities at lower prices than they would be available from another country.

Senator Sandford:

– And there would be less freight.

Senator DEVITT:

– Yes, there is also the freight factor to be considered. This Agreement has some particular advantages. Of course, there are overall advantages in the implementation of the Agreement. I do not disagree with that proposition at all. There are specific advantages. In the last few days I have been inquiring into the cost of the importation from New Zealand of a particular type of hardboard which is suitable for apple containers - the self pack type of container in which so many Tasmanian apples are exported overseas. As the provisions of the Agreement progress, certain advantages will flow. I cannot nominate the number. For instance, there will be a reduction in the cost of purchase by the orchardist of the container in which he exports his apples. This will be an advantage to the primary industry. But I suggest to the Senate that, notwithstanding this fact, the disadvantages to my State outweigh any advantages which I can see at the moment in the implementation of the Agreement as it now stands. I think that the Senate needs to have another look at this Agreement. I cannot for the life of me tolerate the position. I cannot vote for something which will mean the virtual destruction, I suggest, of a very important industry in Tasmania.

I was impressed with the comments of Senator Cotton. I am always most interested to listen to his observations in the Senate. They are always well prepared, documented and authenticated. I listen with a great deal of interest on each occasion he speaks, particularly on the subject of primary industries. I think that we all owe a debt of gratitude to him for the quality of the advice that he gives and good common sense that he shows. I pay him this compliment in all sincerity. The Senate can take some consolation from the assurance which he has given about the intense interest which has been shown by the officers of the Department of Trade and Industry who went to a great deal of trouble to bring this Agreement to fruition. I am concerned, however, about the indecent haste with which this Agreement came to fruition. I have certain letters before me written by the Canning Pea Growers Association of Tasmania to the Minister. So far as I have been able to learn, the Association was given a very short time in which to come to Canberra to take part in consultations with the Minister and senior departmental officers on the question of the implementation of the Agreement. It was only a fortnight after they were first advised of the intention to bring the Agreement into operation that our own Minister-

Debate interrupted.

page 540


Vietnam - The Parliament - West Irian - Tapping of Telephones


– Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -

That the Senate do now adjourn.

Senator Cohen:

– There are two matters that I wanted to raise this evening. One of them concerns a matter which I want to raise of my own volition. The other concerns a subject that the Acting Leader of the Government in the Senate (Senator Gorton) desires to raise in reply to a question of mine yesterday. I am in your hands, Mr. President, as to the procedure that might be adopted. I thought the Minister might indicate the information he has in reply to my question, then I might be permitted to follow him.

Senator Gorton:

– I cannot speak again if i do that.


– If the Minister is ready to give the reply to the question then that will not prevent Senator Cohen from speaking.

Senator Gorton:

– The position is that I am prepared to give a reply to a question asked by Senator Cohen. But I understand that Senator Cohen wishes to raise another matter and I want to be able to reply to him. I am wondering whether I would be precluded from doing so.


– This may be done by leave.

Senator GORTON:
Minister for Works · Victoria · LP

.- The first matter on which I wish to speak relates to a question addressed to me yesterday by Senator Cohen as to the validity of Australian forces being in South Vietnam. Senator Cohen asked -

In view of the fact that there has been no resolution of the United Nations Security Council authorising any enforcement action by any of the parties to the S.E.A.T.O. pact, is not the Australian Government’s action inconsistent with the provisions of Article 53 of Chapter VIII of the United Nations Charter…..

I said at the time that I. could not quote the relevant chapters of the Charter to Senator Cohen but that I would give them to him later. I now reply to that question. Article 53 of Chapter VIII of the United Nations Charter concerning enforcement action and regional arrangements is not applicable to the action taken by Australia and the United States of America in Vietnam. The United States, Australia and other countries are assisting South Vietnam at its request and in accordance with its recognised right to defend itself and call upon friendly countries for support. Action of this description is not enforcement action requiring the authorisation of the Security Council under Article 53. Rather, it is action arising from the exercise of the inherent right of self-defence under general international law. The existence of this right is recognised in Article 51 of the Charter. Article 51 of the Charter provides, inter alia, that: -

Nothing in the present Charter shall impair the inherent right of individual or collective selfdefence if an armed attack occurs against a Member of the United Nations, until the Security Council has taken measures necessary to maintain international peace and security.

This Charter provision recognises the inherent right of self-defence available under international law to all countries whether members of the United Nations or not. The Charter nowhere contains any provision designed to deprive non-members of the right of self-defence against armed attack.

Australia has the right to assist in the defence of South Vietnam although that country is not a member of the United Nations. Article 51 does not purport to impose restrictions on nor to cut down the rights of members of the United Nations under international law to participate in the collective defence of a country which is not a member of the United Natrons. By its own terms the Article preserves an inherent right.

Senator COHEN:

.- With every deference to the Acting Leader of the Government in the Senate (Senator Gorton) I suggest that the considered answer that he has given to the question I raised yesterday does not meet the point. 1 desire to quote in full Article 53 of the United Nations Charter because that is the particular article I raised for consideration. It states -

  1. The Security Council shall, where appropriate, utilise such regional arrangements or agencies for enforcement action under its authority.

I pause there to say that that refers to the previous Article which permits the existence of regional arrangements in dealing with matters relating to the maintenance of international peace and security. Article 53 goes on to state -

But no enforcement action shall be taken under regional arrangements or by regional agencies without the authorisation of the Security Council, with the exception of measures against any enemy state, as defined in paragraph 2 of this Article, provided for pursuant to Article 107 or in regional arrangements directed against renewal of aggressive policy on the part of any such state, until such time as the Organisation may, on request of the Governments concerned, be charged with the responsibility for preventing further aggression by such a state.

The term enemy state as used in paragraph 1 of this Article applies to any state which during the Second World War has been an enemy of any signatory of the present Charter.

That was in 1945. Clearly there has been no authorisation ever by the Security Council, nor by the General Assembly of the United Nations for that matter, in relation to Vietnam. Therefore it seemed to me when I asked the question that no occasion had arisen for action under S.E.A.T.O. even if the relevant pact applied. As for Article 51, which the Minister mentioned, that deals only with the inherent right of individual or collective self-defence if an armed attack occurs against a member of the United Nations - that is, pending the Security Council taking measures necessary to maintain international peace and security. In the case of Vietnam, clearly there has been no invocation of the power of the Security Council to act. I remain completely unsatisfied with the reply that the Minister has given, however considered it may have been.

I want to raise another matter tonight. It is a serious one I think. It deals with the cavalier manner in which the Government treats questions asked in this Parliament. My complaint refers to a series of questions which I have asked. Really there is only one question but I have had to ask it three times of the Leader of the Government (Senator Henty). I informed him of my intention to raise this matter on the adjournment but, as we know, he has been called overseas. On 16th March I asked the Leader of the Government this question -

Has the Saigon Government stated that during 1965 alone a total number of 113,000 men deserted from the Army of South Vietnam? This number is equivalent to approximately half the total number of United States forces at present in South Vietnam. Was the Australian Government aware of this fantastic state of affairs last week when it decided to treble the number of Australian troops in South Vietnam?

Senator Henty replied ;

I have not seen the statement to which the honorable senator referred.* 1 cannot, therefore, confirm as he requests, that the Saigon Government has made such an announcement I shall obtain the information for the honorable senator immediately and present it to him tomorrow.

That was on Wednesday 16th March 1966. I was not in the Senate the next day. The following Tuesday, the next day on which the Senate met, I asked the Leader of the Government whether he was yet in a position to supply an answer to my question. He said -

I undertook to give the honorable senator a reply as early as possible; I hoped it would be the following day. 1 received a note from the department concerned but the honorable senator was not in the chamber at the time when I got it.

That is conceded.

The department stated that it had been unable to verify that the South Vietnamese Government had made such a statement but was undertaking further investigations and, as soon as possible, would give me the information. When I receive it, I shall make it available to the honorable senator.

In raising that question I was acting upon what appeared to me to be an authentic report by a special correspondent of the “ New York Times “ from Saigon published in the “New York Times” of 24th February 1966. In a lengthy article, the “ New York Times “ dealt with the proposition in respect of which I sought information. It alleged that the Saigon Government in a report had stated that the number of desertions in 1965 alone was 113,000 and that in December it had reached the rate of 18 per cent, from the Tegular forces, but that the United States authorities, deeply concerned about this rate of desertion, felt that this had not taken into account the factor of men returning later to the forces, and there was an adjusted figure of some 96,000 as the total number of men deserting during 1965. In the course of the debate on international affairs on 23rd March - and that is almost a month ago - I dealt at some length with this matter. I mentioned in extenso the report in the “New York Times “ and I mentioned the fact that so far we had got no information from the Government. I asked -

Are we to assume that the Government knows so little of the facts of the matter that it does not know what is the rate of desertion from the South Vietnamese Army? According to this report, it was 18 per cent, in December. If the Government did not know, it stands condemned for inefficiency and for an inability to look after Australia’s best interests. If it did know, it had a duty to tell the Australian people what the facts were and to provide a clear explanation.

It was obviously no trifling matter that we were dealing with, because with that kind of background there had been a decision by the Australian Government to increase the Australian commitment of troops in Vietnam.

I waited until this morning, when I asked the Minister the question again. He said that the Government had no information - this is over five weeks after the original question was asked - as to whether or not the Saigon Government had made the statement. He then dealt with some figures other than the ones to which T was referring. He specifically did not deal with the number of desertions but he dealt with the statistics relating to an increase in the number of the forces of South Vietnam - regular and otherwise. Not being satisfied with that, I asked another question as to whether the Minister would state specifically whether, before answering my question, the Government had sought information from the Government of South Vietnam. I got a most unsatisfactory answer to that.

It is my contention that this kind of treatment of questions asked by members of Parliament lowers the dignity of this Parliament and demonstrates a complete contempt for the Australian Parliament and the Australian people. If it does not show that, it shows a monumental inefficiency on the part of the Government in handling questions which, after all, are questions of very considerable moment to the people of Australia. They concern the background against which our men - including conscripted men - are being sent over there to fight and die in Vietnam. I think that this matter could have been cleared up by an inquiry either of the South Vietnamese representatives in Australia or directly of the Government of South Vietnam. The only information to be sought was whether the report in the “ New York Times “ was true. It was a documented report by a responsible representative of a very reputable newspaper. I have to assume that officers of the Department of External Affairs either attend or read debates on international affairs in this Parliament. I should have thought that would be a part of the duty of some officer, or perhaps more than one officer, in the Department of External Affairs. I suggest that it is just not good enough to treat us like this. We are entitled to answers and I think we should keep on demanding answers because the dignity of this Pariament demands it.

I want to go on record as complaining at this treatment. As I say, the matter is important. The Government must have some sources- of information. But the attitude of the Government seems to be that it will answer just as little as it can get away with. We are entitled, I think, to have the respect of the Government when we raise these questions. I am not satisfied and I will continue to press on this question and on any other question until I get an answer which at any rate contains all the information that the Government can reasonably be asked to supply.

Senator GORTON:
Minister for Works · Victoria · LP

– by leave - Senator Cohen will remember that this matter was initiated when he asked the Leader of the Government in the Senate (Senator Henty), as the representative in this place of the Prime Minister (Mr. Harold Holt), whether the South Vietnamese Government made a particular statement concerning desertions. Senator Henty replied that the Government had no knowledge of any such statement having been made by the South Vietnamese Government. That information would have been supplied to Senator Henty by the Prime Minister’s Department - since the question was asked of him - from the Department of External Affairs. At that stage - and I think not before that stage - Senator Cohen asked what sort of inquiries had been made. He said, in effect: “ You get up here and you say you have no knowledge. What sort of inquiries were made? “ Senator Henty, having been supplied with the information from the Prime Minister’s Department as to inquiries made by the Department of External Affairs, would not be expected to have that knowledge at his finger tips.

But far from these matters being treated in a cavalier way and no attempt being made to substantiate the answer that Senator Henty gave to Senator Cohen, inquiries were in fact made by the Department of External Affairs as a result of Senator Cohen’s question. He asked the question on 16th March, and on 17th March the Department of External Affairs asked, by cable, our embassies in both Saigon and Washington whether they had any knowledge of such a statement having been made by the South Vietnamese Government. Both those embassies replied that they did not have such knowledge. Subsequently, further inquiries were made in Saigon by the Department of External Affairs of the Secretary of State for Information in the South Vietnamese Government, a Mr. Chin, and he confirmed that the South Vietnamese Government had in fact not made such a statement. That information, too. was passed to the Department of External

Affairs. As a result of this, the Prime Minister’s Department told Senator Henty that there was no knowledge and no record of such a statement having been made.

That being so - and I do not blame Senator Cohen for not knowing that this is the sort of action that is taken in an endeavour to supply answers to senators who ask for them - I do not think that any charge can lie of just not attempting to find the answers to questions which are asked by members of Parliament. Had the honorable senator at the time asked what inquiries had been made, as he did today for the first time, we would have been perfectly happy, as I am now, to tell him of the sort of inquiries that were made on his behalf.

Senator DITTMER:

– I sympathise with Senator Gorton, who is Acting Leader of the Government in the Senate and Acting Minister for External Affairs. I realise how difficult were the questions that were posed to him and how difficult it would be to supply answers, because no-one on either side of this chamber or, incidentally, in the other place, either, would be an authority on those matters. I want to address another question to him. On 14th April a Cairns fisherman, M. Bedford, was alleged or reported to be held in Merauke. Is the Minister in possession of information to the effect that this man is held in Merauke and the reason for which he is held? I pose this question: If he is held in Merauke, is there any possibility of his being released? This man was a citizen of Cairns and is now alleged to be held at Merauke. I take it that the Minister is in possession of the full information. What is the cause of the delay? What was the reason for his being held? No information has been made available. I am wondering whether the Minister is in a position to make a statement about this person. His parents are particularly concerned about him.

Senator Gorton:

– I will do so as soon as I can.

Senator DITTMER:

– I wilt tell the Minister now what the answer will be - that he is held in Merauke.

Western Australia

– I wish to make a complaint on similar lines to that made by Senator Cohen in regard to failure to answer questions that are asked in the Senate. On 17th March last I directed this question to the Minister representing the PostmasterGeneral -

Are the telephones of any members of Parliament tapped by the Commonwealth Security Service?

I should have thought that that would be a question on which the Government would be very eager to answer. It would seem to be a rather serious matter if the telephones of members of Parliament are tapped. It would have been very easy for the Minister to have said “ No “ and to have expressed horror at the fact that such a base suggestion should be made. Well over a month has elapsed since the question was asked, but no answer has been given. This question could have been answered by saying “ Yes “ or “ No “. I did not ask: If telephones have been tapped, whose telephones have been tapped and why were they tapped? I merely asked whether the telephones of members of Parliament are tapped. I repeat that no answer has been given. This is a rather serious matter. It is starting to look much more serious in view of the fact that no answer has been given.

Minister for Customs and Excise · New South Wales · LP

– I merely represent the Postmaster-General in the Senate. I shall draw his attention to the comments of the honorable senator. I should say that there will be a very prompt answer and that it will be “ No, a thousand times no “.

Question resolved in the affirmative.

Senate adjourned at 10.53 p.m.

Cite as: Australia, Senate, Debates, 21 April 1966, viewed 22 October 2017, <>.