30th Parliament · 1st Session
The PRESIDENT (Senator the Hon. Condor Laucke) took the chair at 11 a.m., and read prayers.
– 1 present the following petition from 6 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The humble petition of undersigned citizens of Australia respectfully showeth:
That the existence of a system of double taxation of personal incomes whereby both the Australian Government and State Governments had the power to vary personal income taxes would mean that taxpayers who worked in more than one State in any one year would-
be faced with complicated variations in his or her personal income taxes between States; and
find that real after-tax wages for the same job would vary from State to State even when gross wages were advertised as being the same; and
Require citizens to maintain records of income earned in each State.
Your petitioners therefore humbly pray that a system of double income tax on personal incomes be not introduced.
Petition receive^ and read.
-I give notice that, on the next day of sitting, I shall move:
1 ) A Select Committee be appointed for the purpose of completing the consideration of a matter previously referred to, and considered by, the Legislative and General Purpose Standing Committee on Social Environment, appointed during the previous session, namely, the Environmental Conditions of Aborigines and Torres Strait Islanders and the Preservation of their sacred sites, and reporting to the Senate upon that matter.
The Committee have power to consider the minutes of evidence and records of the former Legislative and General Purpose Standing Committee on Social Environment relating to the matter referred to in paragraph ( 1 ).
The Committee consists of six senators, three being members of the Government, nominated by the Leader of the Government in the Senate, and three being members of the Opposition, nominated by the Leader of the Opposition in the Senate.
The Committee elect a Government member as Chairman, who may, from time to time, appoint another member of the Committee to be Deputy-Chairman. The member so appointed shall act as Chairman at any time when there is no
Chairman or the Chairman is not present at a meeting of the Committee.
In the event of an equality of voting, the Chairman, or the Deputy-Chairman when acting as Chairman, shall have a casting vote.
The quorum of the Committee be three.
The Committee have power to send for and examine persons, papers and records, to move from place to place, and to meet and transact business in public or private session.
Committee report to the Senate by 3 1 May 1976.
The foregoing provisions of this resolution, so far as they are inconsistent with standing orders, have effect notwithstanding anything contained in the Standing Orders.
– May I inform the Senate that my colleague, the Leader of the Government in the Senate and Minister for Administrative Services, is accompanying the King and Queen of Jordan to the War Memorial this morning and does not expect to return before question time has concluded. In those circumstances, may I suggest to honourable senators that if they have questions to ask of the Leader of the Government, either as the Minister for Administrative Services or in any of his representative capacities, they might defer them or, if they are pressing questions, ask them of me and I shall endeavour to provide an answer.
– My question is directed to the Minister for Education. The Minister will recall that in his answer yesterday to my question concerning tertiary education fees he said that the Government has no policy as yet for the year 1977 and subsequent years. Is the Minister aware that many students have embarked on a tertiary education course on the understanding that no fees will be charged and could only continue if that situation remained? The Minister will appreciate that the uncertainty created by his answer will mean that many students will be unable to proceed with the academic year they have just begun without any assurance that fees will not be charged in the next year of their course. Does the Minister intend to discuss the matter with the Australian Vice Chancellors Committee and the Australian Union of Students? If not, will he consider doing so?
– I have not had recourse to Hansard as yet, but I noted this morning that it has been stated that the Leader of the Opposition yesterday referred to fees. Whether I heard correctly or not, the totality of my answer, as I think he will acknowledge, was directed to allowances. If I misunderstood, let me now apologise and say that my answer yesterday related to the Tertiary Education Allowance Scheme. The honourable senator will see in Hansard that it related totally to that. I will now direct myself to the question asked of me regarding fees. Fees for tertiary students for this calendar year will not be charged; there will be no fees. The stated policy of the Fraser Government is to maintain the situation with regard to nonpayment of fees for those enrolling in tertiary institutions. That is the Government’s policy. To that extent, therefore, the matter of the triennium is not relevant to the situation. The triennium is relevant to assembling the costs of the whole of education. I very much regret it if I misunderstood the question asked yesterday. My answer then was directed to allowances.
– My question to the Minister representing the Minister for Post and Telecommunications refers to fringe advertising. As many businesses give great assistance to sport generally in the form of sponsorships, the attempted abolition of fringe advertising would greatly affect sport generally in this country. Is the Minister aware that it would be practically impossible to stop fringe advertising generally? I refer to such things as brand names on tennis racquets, and the televising of test cricket in England. One could give many other examples. I ask: What is the Government’s attitude towards fringe advertising in relation to the telecasting of sporting events?
-It would be extremely difficult, even if it were deemed desirable, to prevent fringe or perimeter advertising in the media.
– You would have no constitutional power.
– I acknowledge that that may well be so. Surely it is primarily the responsibility of the Australian Broadcasting Control Board, in its legal responsibility for standards, to recommend on this in the first place. I can say, however, that the Government has taken no formal position on this issue and that at this stage it has no immediate plans for so doing.
-Did the Minister for Social Security recently state that people disadvantaged by floods in Queensland, northern New South Wales and Central Australia would receive special benefit payments? Did the Minister state also that it was not proposed that any direct compensation payments would be made by the Commonwealth to flood victims in Queensland and New South Wales? Do I take it from the Minister’s statement therefore that direct compensation for personal injury and loss of property for Central Australian flood victims will be made by the Commonwealth?
– What was stated by the honourable senator in the early part of his question with regard to my comments with respect to flooding in New South Wales and Queensland was correct. With regard to the latter part of his question, if he will give me some time to consider the request in more detail, I shall give him a more definitive answer.
– My question is addressed to the Minister representing the Minister for Health. With reference to a statement made on 31 August 1975 by the then Minister for Health, Dr Everingham, regarding the introduction of a requirement to include a warning against abuse on all radio and television advertisements for analgesics, has such a warning ever been required to be given by advertisers of analgesics? If not, why not? Will such a warning be required in future?
– I think that the nature of the question is such that I should obtain an answer from my colleague, the Minister for Health. With regard to the statement made by Dr Everingham, the former Minister, I am unaware of the accuracy of the statement that has been quoted and, as far as I know, no decision has been taken by the Government at this stage that would relate to the advertising of analgesics.
-Can the Minister for Environment, Housing and Community Development inform the Parliament whether it is the intention of the Department of Defence to allow nuclear powered vessels eventually to use Cockburn Sound facilities? Can the Minister advise further whether his Department of Environment, Housing and Community Development has recommended that such facilities should not be made available for the use of this type of vessel? I remind the Minister that the foregoing would indicate that there is some confusion between the 2 departments. Can the Minister state exactly what is likely to take place?
– I cannot say what is the intention of the Department of Defence or- more accurately in our system of governmentwhat is the intention of the Minister for Defence or of the Government. There was some speculation in the Press this week about letters which allegedly had passed between the Minister for Defence and myself, and myself and the Minister for Defence. All I say is that I have never sent any letter to the Minister for Defence on this subject. That it is a matter of discussion is well known. It has been a matter of discussion since the days of the McMahon Government, throughout all the days of the Whitlam Government, and it is a matter that is currently receiving consideration. When the Government has determined on the course that it will follow, there will be a statement indicating what that course is.
- Mr President, may I ask a supplementary question?
– I call Senator Keeffe.
– My brief supplementary question is this: Can the Minister advise when this decision is likely to be taken?
– It is a matter currently under consideration. I would hope that the decision will be made in the near future. But it will take its course with the other business and in the light of the priority that is given to it.
– I direct a question to the Minister representing the Treasurer. Has the attention of the Minister been drawn to a headline in the Adelaide Advertiser of today’s date, which reads: ‘A grape surplus may not be sold’. Is he aware also that the article states that more than 5 000 tons of wine grapes from this year’s vintage in South Australia may not find a market and that, according to Mr A. D. Preece, President of the Australian Grape Growers Association, the potential losses from this year’s harvest might be avoided by an immediate decision favouring tax relief for wineries? Can the Minister say when the Government’s announced policy in regard to section 31 A of the Income Tax Act will be implemented? In view of the detrimental effect to the wine industry resulting from the previous Government’s imposition of higher excise and stock revaluation, will the Government treat this matter as urgent?
– This is a serious matter. It is in the area of general policy and relates to what the Budget might or might not do. Nevertheless, I think I should take it up urgently with the Treasurer. I shall do that.
– I ask the Minister representing the Attorney-General whether Commonwealth Police recently entered Melbourne University and, in an endeavour to trade information, alleged that I had signed an affidavit supporting the admission of Mr E. Zananiri to Australia? If so, will the AttorneyGeneral inform the said Police that I have not signed any such affidavit?
– I certainly am not aware of the allegation made or of any action of the character suggested by the honourable senator. In his question he asks whether I will convey information to the Commonwealth Police about his non-involvement in the matters alleged. This will now be a matter for the record. I am sure that anyone who is interested will appreciate what the honourable senator has said.
– I preface my question, which is addressed to the Minister representing the Minister for Transport, by saying that I was quite robust until I had an unrelieved diet of soggy sandwiches and rather unpleasant biscuits on the airlines and had to drink something described as tea or coffee but not identified as being either. Is the provision of in-flight services regarded by the Government as a matter affecting the efficient and economic operation of air services so as to bring such services within clause 10 of the Civil Aviation Agreement, contained in the Second Schedule to the Airlines Agreement Act 1952-73? If it is so regarded, does this prevent either of the 2 airlines improving the present standard of in-flight service without the approval of the other airline?
– I am one of those people who regrets the passing of the lamington and the chocolate eclair from airlines afternoon tea and morning teas. It is a matter of considerable sadness to me to see the decline in the food provided in the airline system. Honourable senators might recall that in my day the standard of food was higher than it is today. To people who are travelling long distances this is a matter of some consequence, although it might seem a joke to those who travel short distances. I do not want to see Senator Chaney disappear from our ranks because of a series of duodenal ulcers brought about by bad food. Accordingly, I shall have the matter taken up with the Minister for Transport. There is no barrier to either airline deciding to improve its standard of in-flight meals. If a company gets into conflict with its competitor the rationalisation committee can son out the matter. So the great fight of lamingtons and cream cakes versus soggy sandwiches is about to be joined.
-I was about to say that I wished to ask a question without notice but I correct that and say that my question was without notice about 9 days ago. I am asking it again because of the inordinate delay in receiving an answer. I direct my question to the Minister representing the Attorney-General in the terms in which I asked a similar question on 24 February. It has been widely reported that the Government requested the Attorney-General to draw up a legal opinion with respect to those sections of the Crimes Act 1914-73 relating to sedition. Are these reports true? If they are, is this an attempt by the Government to stifle legitimate critical analysis and objective criticism of the extraordinary and unprecedented action taken prior to and on 1 1 November 1975 by the holder of the position of Governor-General of Australia?
– I recall the earlier question which Senator Brown asked. He subsequently, I think at my request, placed it upon the notice paper. It is on the notice paper. Because he asks the question today I understand that he has not yet received a reply. All I can say is that I shall personally bring the matter to the attention of the Attorney-General in the hope that a reply can be expedited.
– I direct a question to the Minister representing the Minister for Administrative Services. I do so with some reservations in view of the Minister’s earlier statement. Nevertheless, I proceed because I think this is a matter of some urgency. I refer to the Australian War Memorial in Canberra. I draw the attention of the Minister to the annual report of the Board of Trustees of the War Memorial and to some of the difficulties which they have highlighted in that report, in particular that the collection is rapidly deteriorating, that important parts of the collection may soon be beyond restoration and that remedial action will be difficult unless this deterioration is halted immediately. Will the
Minister consider taking action urgently to overcome those problems and to ensure the preservation of the material in the War Memorial, which is amongst the finest collections of its kind in the world and which I believe is an important part of our national heritage?
– I am interested in what the honourable senator has said. Of course, I am responding on behalf of the Minister for Administrative Services. He is aware of the problems that have been mentioned in that report. I think they reflect similar problems to those referred to by the Committee of Inquiry on Museums and National Collections, which has reported and which had its report tabled in this place last October or November. The collection is a valuable one, as the honourable senator has said, and I am quite sure that it is in the nation’s interests that the matters that have been adverted to be considered. They are being considered by the Government. If there is anything further to be said by way of response, I am sure that Senator Withers will provide the honourable senator with that information when he learns of the question being asked.
– I direct a question to the Minister representing the Treasurer. In answering a recent question on the subject of assistance to local government through the agency of the Grants Commission, the Minister advised me that the Grants Commission would not this year consider the needs of special assistance to local government but that, notwithstanding this, local government could expect to get more financial help now than in the past. Is he aware that in today’s Tasmanian Press local government leaders have expressed their gravest concern at the dismal prospects facing them as a consequence of substantial road grants cuts of which they have now become aware? Will the Minister be more specific in relation to the prospective enhanced financial prospects that he mentioned to me some days ago and say just how this most desirable situation is to be achieved, so that the fears of local government organisations throughout Australia can be allayed and budgetary planning can be realistically undertaken in accordance with the long-standing practice of local government?
-There is certainly a strong Treasury involvement in this area, but there is also an involvement of the Minister for Administrative Services and the Minister Assisting the Prime Minister in Federal Affairs. I think the best course of action to take in order to get a clear definition in relation to the honourable senator’s question is to have it put on the notice paper, and I ask the honourable senator to do that.
– My question, which is directed to the Minister representing the Minister for Post and Telecommunications, relates to the answer he gave yesterday to a question asked by Senator Walters concerning the courier services that are being introduced by the Australian Postal Commission. Is it the Government’s intention to permit the many private courier services that have been operating in this field for some years to continue in competition with the courier services provided by the Australian Postal Commission?
– I am not aware of the Government’s intentions in this field. Since the question relates to a policy matter, I ask the honourable senator to put it on the notice paper and I will get an answer for him.
– I direct a question to Senator Greenwood who is representing the Leader of the Government in the Senate. In view of the increasing public concern about the unknowns which surround the actions of both the Leader of the Opposition and the Prime Minister in regard to the Iraqi election funds issue, highlighted today by an advertisement in the Australian Financial Review inserted by the Citizens for Press Reform group, will the Government set up a royal commission to investigate the growing number of allegations in an atmosphere free of the spate of daily writs and mysterious police investigations, and give the public an opportunity to know whether (a) Iraqi funds have passed to the Australian Labor Party illegally in breach of banking regulations; (b) the Prime Minister is the source of the allegations which his Attorney-General has mentioned as the basis for Commonwealth Police action; (c) there have been communications between Mr Rupert Murdoch and the Prime Minister about this matter; and (d) legislation ought to be introduced to require political parties to publish the source of their campaign funds?
– I suppose there is some reassurance in knowing that since Senator Hall has returned to the Senate he has not lost his voice. As usual, there is an element of serious import and an element of fantasy in what he has said. To suggest that there are some unknowns in regard to this Iraqi affair which concern the Prime Minister is sheer absurdity. The Prime Minister’s position has been stated frankly and he has indicated quite clearly in answers to questions, including answers to questions in the House of Representatives this morning, that the suggestions in the newspapers over the past day have absolutely no substantiation to them.
As far as the Leader of the Opposition is concerned, I agree with the import of what Senator Hall has said. The position becomes curiouser and curiouser. We are not given any information. I am sure that we are now waiting with bated breath to find what Mr Hartley has to say in the light of what has been said by him in the last fortnight. We will be interested to hear what Mr Hawke has to say in the light of what he has said in the last fortnight, and we can hardly await the determinations of the Australian Labor Party national Executive meeting tomorrow.
I can assure the Senate that the Government is getting on with the nation’s business while the Opposition is probing the intricacies of what has been happening in relation to these Iraqis who came to Australia. As the honourabe senator knows, there is a police inquiry into the allegations, which first appeared in the newspapers, relating to whether or not there has been any transfer of money contrary to the banking and foreign exchange regulations. Any suggestion of a royal commission should prudently await the outcome of those investigations. Then it will be a matter for the Government in the light of what is revealed.
-Has the Minister for Industry and Commerce seen a report in last Monday’s Australian Financial Review of his address to the Confederation of Apparel Manufacturers in which he is reported to have said that the tariff cuts of 1974 had not in the slightest degree reduced the cost of living and that all they did was to drive manufacturers to their knees? Is that report substantially correct? If so, if there were no changes in the relative prices of imports and domestic manufactures after the tariff cuts, why did comsumers buy relatively more imported goods, especially textiles, after the cuts?
-The honourable senator has got himself slightly confused between 2 issues. There was no evidence anywhere that I could find- if the honourable senator has it I would be very glad to have it- that the 25 per cent tariff cut did other than bring big manufacturing almost to a state of disaster. Secondly there was a conscious Government decision which he will recall, arising out of the heavy balance of payments surpluses, to encourage a very massive flood of imports. That is the reason why consumers bought more imports. I would observe here in passing that all honourable senators ought to have some concern for the prosperity and employment capacity of Australian industry, whether it is retailing, commerce or manufacturing. The evidence is this: There was a decline in employment in the manufacturing field, because of a series of Government actions, of something like 135 000 people. There was no substantial decline in employment in the primary industries because they do not employ a big sectoral percentage. Public Service employment hardly declined at all. The best evidence is that the manufacturing shock of itself produced its own unemployment and all the multiplier effects of it. Out of all that it is a fair construction, if anybody likes to examine it, that the principal reason in Australia for the high level of unemployment today was the shocks administered to the industry sector by the previous Government in a series of devices which it adopted.
– I direct a question to the Minister representing the Treasurer. I refer to a Press release from the Treasurer dated 25 February last relating to investment allowance. No reference was made in that statement to the application of the allowance to items held under either hire purchase agreement or lease. These were mentioned without clarification in an earlier statement. Will the Minister arrange for a further statement to be made at an early date clarifying the position in relation to the application of the allowance to items under hire purchase or lease?
-I am grateful to the honourable senator because I took an interest in this matter at the time of the investment allowance issue. It is very important in my view that the investment allowance concession in the area of leased plant or hire purchased plant ought to pass through to the user. As the law at present stands ownership is retained” by the lessor. The Treasurer made it very clear that the Government was working towards a position where these advantages would be back in the hands of the user. That is still the case. I shall certainly check up as the honourable senator suggests and see what stage the legislative arrangements or negotiations have reached to achieve that result.
– I ask the Minister representing the Treasurer: Is it a fact that the Government savings bond fiasco, which is costing the taxpayer $77m per annum in interest, has diverted savings away from the banks and building societies, where they were doing a good job in financing the revival of housing, and in turn has forced up interest rates? When will the Government scrap the scheme?
– The honourable senator has been interested in this matter for some time and he will find a letter addressed to him, if he has not already got it, from the Treasurer giving him some of the information for which he asks. I think it ought to be known to him as it is known to most other people that the Series 1 Special Bonds were closed off with about $760m. The Series 2 Special Bonds, issued at a lower interest rate, are not attracting very much money at all. The principal arrangements were to take up a funding of liquidity that had been created by the previous deficit financing which was washing around, causing a great deal of trouble. It is equally true that there has been some upward movement in New South Wales interest rates which were traditionally low by the normal standard for both deposits and loans in the Australian building society system.
– The Minister representing the Treasurer will be aware of Mr Hamer ‘s undertaking to abolish probate duty in Victoria on all property passing to one spouse on the death of the other. Do not the current rates of estate duty reflect an unfair and severe penalty due to the rising inflation content of values over the past years? Has not estate duty become a destroyer of economic units, a deterrent to development and a force driving expertise away from important areas of industry and commerce? Is not its impact extremely heavy on the relatively small enterprises over a very wide range of activity? As part of the process of encouraging development and productivity, will the Government seek to reduce drastically the rates of estate duty across the board as a prelude to its early abolition?
– In our brief period in Opposition Senator Guilfoyle, myself and former Senator Lawrie joined with members of the then Government in a back bench exercise examining probate and estate duties. We three, Senator Guilfoyle, myself and former Senator Lawrie, issued a minority report recommending that it would be just as well for the Commonwealth to vacate the field. Having been on the printed record with one’s views I again say that at that time it seemed to me that on the cost of collecting and the relative contribution that it made, as against the problems and difficulties it caused, which have been exacerbated since then, there was a case for the Commonwealth to vacate the field. We said so. I shall raise the honourable senator’s question with the Treasurer in the context of everything which he will try to do at Budget time.
– I ask the Minister for Social Security whether she is aware that there is growing alarm amongst age pensioners in Australia at the recent erosion of pensioner benefits. In the light of the fact that the Minister’s colleague in another place, the Minister for Health, reversed his decision to abolish the free hearing aid scheme, will the Minister say whether she is prepared to consider her decision to abolish the funeral benefits for age pensioners?
– The Government is aware of the erosion of benefits to pensioners that has arisen through inflationary trends in our economy and other difficulties through which we have lived in the past 3 years. The Government at present is conducting a review of all pensioner entitlements and benefits. I think it is well known to honourable senators that the Income Security Review Committee has been working for some time on this subject. The specific matter of funeral benefits was a decision of the Government in the recent expenditure review and is part of the consideration in the income security review. Any matter of policy relating to pensioner benefits and their review is a matter of budgetary consideration and in that context I assure the honourable senator that all items related to benefits for pensioners and other people who are dependent upon sources of income from government will be reviewed prior to the Budget as part of the income security review which we are undertaking.
– My question is addressed to the Minister for Industry and Commerce. I refer to a Press statement in which references are made to assistance to the shipbuilding industry. The Minister has agreed that the industry is suffering a severe backlash because of the world shipping position. Has the Minister studied the report which I understand has been prepared by Professor Fink and will the
Government respond to the recommendations contained in that report? Because shipyards and shipbuilding at Whyalla, South Australia, are involved, will the Minister say whether there are plans to assist the industry to avoid the setbacks caused by dismissals due to lack of orders?
-The shipbuilding industry in Australia has 2 very serious problems. One is the tremendous increase in the Australian cost base during the last 5 years. It has been quite astonishing how total costs have risen, and so the cost to industry. Secondly, we are at a time of very low demand for ships around the world and heavy excess capacity in other shipbuilding countries- in many cases giving very favourable conditions to people to buy those ships. So the industry in Australia has got itself into what I might call a double bind. I have been taking a serious interest in the matter. I have studied the report of Professor Fink. It was a very good report, thoughtfully and constructively compiled. I have had a long meeting with the Professor and his staff and the various people from the shipbuilding industry who are affected by the present problems. The Government has the whole matter under consideration at the moment.
-The Minister for Environment, Housing and Community Development will recall saying yesterday that continuing financial assistance for growth centres was now under review despite the Government’s assurance during the election campaign that, if elected, it would continue commitments entered into by the Whitlam Government. Is the Minister aware of the serious repercussions that will follow if the Government discontinues financial assistance to the South Australian Government for the establishment of Monarto in that State, a project which is further advanced in planning than any other growth centre in Australia?
– I can understand Senator McLaren saying that a South Australian project is more advanced than any other growth centre concept in Australia, but I think that is overstating the position. With regard to the question of support for growth centres, the Government has honoured the commitments of the Whitlam Government in regard to financial contributions to growth centres in the current year and there has been no occasion upon which moneys which had been approved and committed for growth centres have not been paid. The Government is giving consideration to the level of its involvement over the whole range of decentralisation projects into the future. Of course, growth centres and support for growth centres, both in principle and in terms of the level of financial support, are matters which are comprehended within that review. It is a continuing review, and in due course a statement will be made as to the Government’s position.
– I preface my question, which is addressed to the Minister representing the Minister for Transport, by saying that no doubt he is aware of the difficulties that are caused to the people of Tasmania whenever there is a strike which involves disruption of air services to that State. Does the Minister recognise the very special needs of Tasmania and will he ask the unions involved to maintain services to Tasmania if at all possible, even if there are stoppages of services to other States?
– As Minister representing the Minister for Transport, I certainly recognise the particular problems and difficulties of Tasmania. I take this question seriously, and at the end of question time I shall speak to my colleague the Minister for Transport about it.
– My question, which is directed to the Minister for Industry and Commerce, refers not only to his own statements previously about the 4-cylinder engine project in South Australia and more recently the General Motors-Holden’s Pty Ltd announcement, but more particularly also to a statement made yesterday by the Prime Minister which has been interpreted as indicating that the Government is opposed to the 4-cylinder engine project in Adelaide. Has the Minister or the Government at this stage taken a positive position of opposition to that plan? If so, has he indicated that position to the consortium or to GMH, because previously his attitude has been interpreted as being that the matter is under consideration? In view of the lack of available information, will the Minister indicate the Government’s views so that the matter might be cleared up? Has the Minister noticed that the General Manager of Chrysler Australia Ltd has said that the GMH project does not interfere in any way with his company’s resolution to go ahead with its plan?
-The announcement by GMH has not altered my position at all, but I will give the honourable senator some extra information which may be useful because he has an interest in this matter which he has expressed previously in the Senate. GMH informed the previous Government some time ago- I think it was late in 1974- of its plans to produce a 4-cylinder engine at its Fishermen’s Bend plant in Melbourne to meet its own future requirements of such engines. The company indicated also that the engine would be made available to other car manufacturers if they required it. The engine has been under test for some time past and I understand’ has performed satisfactorily. Production could commence late next year or perhaps during 1978. Discussions between the prospective participants in the Adelaide consortium are still proceeding, but the parties have given a general indication that they will make no final decision until the Government announces its policy for the industry as a whole and the consortium in particular at about the end of this month.
As we see the situation, there is no point in speculating at this stage on what effect the availability of the potential GMH 4-cylinder. engine might have on the future of the consortium or, for that matter, anything else. We think .that the speculation so far is not adding to anybody’s knowledge. This is no spectacular event. It has been around the place for about 18 months and people have known about it. The GMH decision to produce its own engine is one that it is entitled to make on the basis of its commercial judgment; that is its business. The Government’s review of the policy for the industry in total and the consortium ‘s future is proceeding on schedule and I still hope to have it available at the end of this month.
– I address a question to the Minister representing the Minister for Overseas Trade. In view of yesterday’s report that New Zealand has taken action which, it is reported, will change the Australia-New Zealand trade arrangements relating to motor cars, will the Minister now re-examine the arrangements for the import of frozen vegetables and cheese from New Zealand in the light of the stated needs of Australia’s own dairy and vegetable industries?
-There are due to begin fairly soon some discussions on the whole range of New Zealand-Australia trade relations under the New Zealand-Australia Free Trade Agreement. The Prime Minister is going to New Zealand next week to meet the New Zealand Prime Minister. Discussions in regard to this area will take place after that. I shall note the honourable senator’s comment.
– My question is directed to the Minister representing the Attorney-General and the Minister for Administrative Services. Upon whose authority were Commonwealth police sent to Singapore? Are Press reports concerning that visit insofar as the Commonwealth police interrogation of Mr Sinclair is concerned correct? What was the cost involved in sending the Commonwealth police in question to Singapore? Pursuant to the authority of what international agreement did they interrogate Mr Sinclair in Singapore? Was a ministerial decision made about this matter prior to their being sent to Singapore?
– I do not know upon whose authority the Commonwealth police were sent to Singapore except that, if they went there in regard to the investigation of allegations which appeared in the Press within the last week, that was sufficient authority. That authority has been mentioned in this Parliament during the past few days. I am unaware whether the statements which appeared in the Press are accurate. I will refer the question to the Minister for Administrative Services, who is in charge of the Commonwealth Police, so that he can provide a fuller answer. I think that the honourable senator, as a lawyer, would know that whether police ask questions of a person in Australia or overseas is a matter for the individual himself to determine. No one is obliged to answer questions, as the honourable senator well knows. I do not think that any question arises as to whether the police asked questions under the authority of agreements.
-I wish to ask a supplementary question. I directed my question to the authority given to the Commonwealth police to go to Singapore. The Minister said that that authority was the subject of discussion in the Parliament several days ago. The only authority discussed in the Parliament several days ago was the authority relating to the visit to the advertising agency pursuant to the Banking (Foreign Exchange) Regulations. I again ask: Pursuant to what authority did the Commonwealth police go to Singapore? This is a different matter.
– The authority to which I referred was the authority which was discussed. That authority was given because the Attorney-General indicated that he desired the Commonwealth Police to investigate allegations to see whether there had or had not been a breach of the Banking (Foreign Exchange)
Regulations. It will be recalled that the AttorneyGeneral indicated that in the presence of the Secretary of his Department, he had conveyed to the Commissioner of the Commonwealth Police his request that this investigation should take place. If the visit to Singapore was pursuant to those investigations, that is the authority about which the honourable senator has inquired. If the visit to Singapore was in respect of some other investigation, then I do not know what the authority is. However, I said that I would refer the question to the Minister in charge of the Commonwealth Police for his answer. I think that if one looks at the record one finds that this information flows through quite consistently and clearly.
-Has the Minister representing the Minister for National Resources seen recent statements from the Dow Chemical Co., the Australian Resources Development Bank and the Premier of South Australia that the establishment of the Redcliffs petrochemical works should proceed and that they are awaiting a statement of attitude from the Federal Government? Can the Minister say whether any approach concerning this matter has been made to the Federal Government?
-I have not seen the statement. I do not know whether an approach has been made. I will seek the information for the honourable senator. He could either put the question on the notice paper or I will try to get an answer for him this afternoon if he wishes.
– I direct a question to the Minister representing the Minister for Transport: The Government has previously indicated that the report of the Nimmo inquiry into transport to and from Tasmania and related matters, would be available about this week. I ask: Has the report been given to the Government? If not, when will the report be given to the Government? In either event, when will this report, which is of such vital interest to all Tasmanians, be available for public examination, having regard to the fact that next week the Parliament is not sitting?
-Another honourable senator asked a similar question yesterday about the Nimmo report to which the honourable senator refers. I directed a query to the Department of Transport. As yet, no answer has been received. I will give the Department a reminder after question time.
-I direct a question to the Minister representing the Minister for Transport. Having in mind that the rail link between Port Augusta and Alice Springs has once again been disrupted by heavy rain and flooding, when is it expected that the rail services will be resumed? Is it a fact that damage to the track is more serious than that experienced in the last few years? Is it a fact also that the rail head for Northern Territory goods established at Kingoonya, as an interim measure, will continue for an indefinite period? Is the Commonwealth Railways authority making a close survey of that section of the line near Curdimurka where the level of water in Lake Eyre south recently threatened to engulf the line? Does the authority consider that flood waters now coming down the Channel country from Queensland will cause flooding of the line in the Lake Eyre south area?
– The latest information I have on this matter is that the line is expected to be re-opened to Alice Springs in early April. There is a rail to road transfer point at Kingoonya which will be kept open- as long as necessary. The question of potential flooding out of the Channel country, into Lake Eyre and down through the general area of the flood plains, will have to be examined in further detail by the Minister and by the appropriate authorities. Having some slight knowledge of that country, I can contemplate that there may well be a problem considering the sort of rain that has been experienced in that area.
-I ask the Minister for Social Security: As pensioners form a great part of the disadvantaged groups in our society and as the Government is committed to assisting the disadvantaged; as there was such a drastic increase in the most recent consumer price index and as the Government has deferred increases for pensioners until 1 May, will the Minister give immediate consideration- perhaps through the Income Security Review Committee, which she mentioned earlier- to increasing the amount pensioners are able to earn in this financial year without detriment to their pension or being subjected to further taxation, to enable them to live with some dignity?
– As I mentioned earlier, all matters that relate to pensions and benefits that are being paid are under consideration as a result of the work that is being undertaken by the Income Security Review Committee and the policies of the Government with regard to the forthcoming Budget. I will give consideration to the matters that have been mentioned by the honourable senator. In that context, I can assure her that active consideration of the means by which pensioners are able to live in dignity and also assert some independence is of significant interest to the Government. A decision on this question, as well as on other matters of which reviews are being undertaken, will be announced as Government policy in the forthcoming Budget.
– I desire to ask a supplementary question. Will the Minister for Social Security please advise the Senate of the membership of the Income Security Review Committee?
– I do not have at hand a full list of the members of the Income Security Review Committee. I could give such a list to the honourable senator at a later stage.
-Has the Minister for Education ascertained whether the Government will carry out proposals which emanated from the Labor and Immigration Ministry under the Whitlam Government to create an authority to protect and enhance the status of interpreters and translators? If the answer is in the affirmative, will he indicate to those honourable senators who possess some skill as talent scouts, if they have potential members in mind, to whom they should send them?
– The honourable senator asked me a similar question only a few days ago. I gave him an assurance that I would have discussions with the other Ministers and departments involved. Those discussions are not yet complete. The Government is always interested in bright ideas, and if the honourable senator feels that he has one, then he would be very welcome to communicate with me.
– My question is directed to the Minister representing the Minister for Transport. In view of the legislation now being formulated, will the Minister take into consideration that as a result of the 6.4 per cent wage increase the Prices Justification Tribunal has just approved the following freight increases for ‘Sea Pak’: From Melbourne to Hobart 5.57 per cent; from Melbourne to Northern Tasmania, 2.57 per cent; from Sydney to Hobart, 6.37 per cent; and from Tasmania interstate, 2.57 per cent? Those increases are on top of the bulk Union Steam Ship increases that were brought in on 1 February, and are increasing still further Tasmania’s transport burden.
– Yes, those factors will be taken into account by the Minister in determining the position.
– My question is directed to the Minister for Education and relates to an article in this morning’s Sydney Morning Herald, which states in part:
Will the Minister advise the Senate whether finance will be made available for the New South Wales program to take over private schools for the severely retarded? In view of the Minister’s reported statement that ‘the question of recurrent funding beyond the initial year of transfer was not explicitly covered, but this should not have been taken as implying no financial support, or as a refusal to guarantee support’, will the Minister inform the Senate what the position is in relation to funding beyond the year of transfer?
– I am happy to have this opportunity because, if there is confusion, and confusion there is, it arises out of the chronic failure of the previous Commonwealth Government to communicate specifically or to give specific decisions with regard to State Governments. It is because of that failure that this confusion has occurred. Let me say while I am on my feet that, despite the fact that the Press may wish to so infer, there was no intention that any kind of blame be attributed to the Willis Government. The reverse is true. The facts reveal that Sir Eric Willis, as Minister for Education, reached the correct decisions upon the advice given to him.
So that it shall be understood, I say this: The Schools Commission special education program includes recurrent grants for Government special schools, in addition to recurrent grants which the State may use either to subsidise nongovernment special schools or to facilitate their takeover if the institutions wish it. In 1975, after cost escalation, New South Wales had $2.7 lm for the recurrent costs of its own special schools and a small number of non-government ones it took over during that year. The June 1975 triennial report of the Commission nominated only $2.38m for New South Wales government schools in 1976. After representations to Mr
Beazley, this was increased to S2.93m and was included in the supplementary report for 1976, which is now the basis for legislation being drafted. New South Wales believes that this sum will be enough to meet only the 1976 costs of its own schools and those it has already taken over.
There is a further sum of SI 4m available for subsidy of the non-government schools or for facilitating fresh takeovers but there is no guarantee about what the basis of the Commonwealth contribution is likely to be in the future. The problem has been under discussion as late as yesterday between the Director-General and the Chairman of the Commission and, following yesterday’s talks, it is to be taken up in Sydney next week. The basis of the problem is that the Commonwealth makes a partial contribution towards the costs of government special schools and that in the longer term when a State takes over nongovernment schools it has to bear the balance of the costs.
I make the point that when I wrote to Sir Eric Willis I was entirely unaware that he had written in August to the then Minister and that the then Minister had replied in September. I accept the fact that I should have known that, and that the substance of the then Minister’s reply indicated that there would be no guarantee of future funds in the recurrent sense to finance extra schools if they were taken over. Because of this confusion, because of the lack of a decision by the previous Government so to fund -
– Because we could not get the Budget.
– The honourable senator, a former Minister, interjects and says: ‘Because we could not get the Budget’. That is entirely not true. It was because in 1975 the then Whitlam Government, of which Senator Douglas McClelland was a member, rejected the triennium proposals and cut back education expenditure by 6 per cent and then refused to give any forward guarantees at all. The State Government was entirely proper in those circumstances in not a seeking to take on more burdens in terms of schools for handicapped people and schools for retarded children.
– May I ask a supplementary question?
– I call Senator Colston.
-Did the Minister say that some of the confusion arose because some relevant information had not been brought to his attention recently about what had happened in 1975?
-I said 2 things. The first was that general confusion as to why the State Government did not proceed arose because there were discussions between the Minister and the Commonwealth Government. The Commonwealth Government, in Mr Beazley ‘s letter of September 1975, did not give any indication of any guarantee of future funding. Because a statement in my letter to Sir Eric Willis unfairly could be taken to reflect on the New South Wales Government, I drew attention to the fact that the letter of Sir Eric Willis written to Mr Beazley and Mr Beazley ‘s reply were not known to me when I wrote my reply. I regret that. I apologise for the fact that it was not known to me.
– My question is directed to Senator Greenwood in his capacity as Minister acting for the Leader of the Government in the Senate and representing the Prime Minister in that acting capacity. I refer Senator Greenwood to the statement by Senator Withers at question time yesterday that the purpose of question time is not to seek information but for the Opposition to seek to embarrass Ministers. I ask the Minister: Is this the general attitude of Ministers in both Houses? If not, will he give the Senate the names of Ministers who hold this view, apart from the obvious ones- Senator Withers and Senator Carrick- so that Opposition senators can divide their questions among those Ministers who are willing to give information?
– I hope there will not be many questions of this character from the Opposition. Obviously question time is a time when senators from both sides of the chamber can ask for information which they genuinely desire. They may desire to receive it because they want to be better informed or because they think that, by obtaining it, they can pursue the objectives for which they are here- to support the Opposition’s case or to support the Government’s case. I would have thought that any Opposition on its toes would seek to use question time to embarrass the Government. It is the task of Ministers in responding to questions to ensure that the Government is not embarrassed. This is part of what question time is about. I would have thought that the performance of Ministers in this chamber has been to avoid embarrassment to the Government and to give to all honourable senators the information which they have been seeking. I assure Senator Grimes that that will continue to be the position.
– I ask this question of you, Mr President. I refer to standing order 425 which states:
Any Senator may rise to speak ‘To Order,’ or upon a matter of Privilege which has arisen since the last sitting of the Senate.
Mr President, I seek your earnest consideration and determination in relation to complaints by members in both Houses of the Parliament of the intrusion of police into the public and private lives of members which are, in any case, under constant scrutiny by the media, .or the Press. I refer to the ruling of your colleague and copresiding officer in another place, Mr Speaker, that a member has no right of access to the Privileges Committees of the Parliament for redress and protection from this practice. I would like you, Mr President, at your leisure to state whether you agree with the ruling of your colleague in the other place. As standing order 427 on breach of privilege protects a senator against newspaper assault on his civil and parliamentary rights, should not a senator have similar access to the Privileges Committee in the matter of the intrusion of the police and this type of assault on him in exercising his duties and functions as a member of this Parliament?
– I shall give the matters which the honourable senator has raised my consideration.
– My question is directed to the Minister representing the Minister for Defence or to the appropriate Minister. Having regard to the recent disastrous floods which have covered large areas of both Queensland and New South Wales, will the Natural Disasters Organisation now assume responsibility for planning preventive measures to minimise future dislocation of communities in affected areas and damage to property and livestock?
– I shall refer the question to the Minister for Defence. The Natural Disasters Organisation has been operating in these areas. Generally, the scope of natural disaster activity and the type of action which can be taken to minimise damage and to ensure that compensation is available are currently under consideration by the Government.
– I wish to complete an answer, which I gave to Senator Coleman during question time earlier today, with regard to the membership of the Income Security Review Committee. The group, which has been working for some time, consists of representatives of the Department of the Prime Minister and Cabinet, the Department of Social Security, the Department of the Treasury, the Taxation Office, the Department of Repatriation and the Department of Employment and Industrial Relations. Previously, the Social Welfare Commission was also represented; but, in view of the abolition of the Commission in the near future, it will not have continuity of representation on that Committee.
-Yesterday Senator Wheeldon asked me, in my capacity as Minister representing the Minister for Post and Telecommunications, a question relating to a survey allegedly being taken among the public to determine whether the Australian Broadcasting Commission should be abolished. I said that I would seek information. I am advised that no survey has been commissioned by any authority within the portfolio or by the Department as suggested in the article in the newspaper. As far as the the Minister is aware, no other government department would have an interest in this matter.
- Mr President, I seek leave to make a personal explanation on the ground that I have been misrepresented.
-Is leave granted? There being no objection, leave is granted.
Senator DOUGLAS McCLELLANDSenator Carrick, during the course of a reply to a question posed to him by a colleague of mine from Queensland, stated that I, as a Minister in the Whitlam Government, knew that that Government in the presentation of its 1975-76 Budget had cut back on educational expenditure. The fact is that that is not so. I could not possibly have known that because the Whitlam Government increased its expenditure on education in the 1975-76 Budget compared with the 1974-75 Budget.
– For the information of honourable senators, I lay on the table copies of petitions filed in the Court of Disputed Returns by Helen Therese Berrill, petitioner in the matter of the Senate election held in South Australia on 13 December 1975 and in the matter of the Commonwealth Electoral Act; and by Bruce Noel Hill, petitioner in the matter of the Senate election held in Tasmania on 13 December 1975 and in the matter of the Commonwealth Electoral Act.
– For the information of honourable senators, I present the annual report of Qantas Airways Ltd for the year ended 31 March 1975, together with financial statements and the report of the AuditorGeneral on those statements.
-( Victoria-Minister for Social Security)- Pursuant to section 16 of the Social Welfare Commission Act 1973, I present the report of the Social Welfare Commission on the Australian Assistance Plan. I seek leave to make a statement relating to that report.
-Is leave granted? There being no objection, leave is granted.
– I have received from the Social Welfare Commission a report on the operations of the Australian Assistance Plan to date. In accordance with section 16 of the Social Welfare Commission Act 1973, I have tabled this report for the information of honourable senators. The Australian Assistance Plan is now in the final year of the 3-year pilot program. Independent persons were appointed to evaluate the effectiveness of the Plan and to report their findings to the Social Welfare Commission. Having regard to the evaluation reports and to its consultations with interested parties, the Social Welfare Commission has made a number of recommendations regarding the future operations of the Australian Assistance Plan. These recommendations are part of an overall assessment of the Plan and will need to be considered in the light of the recommendations of the Administrative Review Committee under the chairmanship of Sir Henry Bland on future administrative arrangements having regard to Federal and State relationships.
The comments that will be forthcoming from individuals, groups and voluntary organisations as well as State government and local government authorities on this report will be considered. I have already forwarded to my State colleagues a copy of the report for their information and comment. I have directed my Department to arrange meetings with these groups and institutions at an early date so that a comprehensive basis will evolve for the Government to review the policy objectives which the Australian Assistance Plan incorporates. As has already been mentioned to honourable senators, a conference will be held from 30 April to 3 May at the Australian National University on the Australian Assistance Plan at which this report, together with all of the other evaluation material, will be considered. As I stated earlier, members of both Houses of the Parliament are invited to attend this conference and formal invitations will be sent out shortly.
– by leave- I move:
We of the Opposition welcome this report, as we welcome any other reports on the progress of the Australian Assistance Plan. We believe that the Australian Assistance Plan was an imaginative plan. Indeed, it was welcomed initially by the then Opposition’s spokesman on social security, Mr Chipp. One of the difficulties that the Plan has experienced has been the fact that opposition to the Plan by conservative governments in various States put a layer of fear over the people who were working under it. I believe that this opposition was based on their fear of allowing the local and regional areas of this country to have further power over decision-making in their own areas. I believe it is ironical that the conservative governments in this country, which made such a fuss about the allegedly centralist policies of the Labor Government, vigorously and almost invariably opposed such Australian Labor Party initiatives as direct aid to local government, the innovations program in the field of education and the Australian Assistance Plan, which gave to local government areas and local government groups the power to make decisions.
– It was the other way around.
– Like so many other delays in the field of social security, this delay in the Government’s deciding just what is to happen makes for a period of uncertainty. The 3-year period of the Plan is almost running out. Many of these people really have no idea just what to expect. As I said before, the Plan has always had a cloud over it because of the opposition from Senator Sheil’s conservative friends. It seems likely that this uncertainty will continue for some time. The statement of the Minister for Social Security (Senator Guilfoyle) mentions the Bland Administrative Review Committee. We on this side of the Senate certainly would hope that when the decision is made about the Australian
Assistance Plan a great deal of weight is given to the results of the AAP and its various schemes and the potential results. We hope that any decision will not be made entirely on administrative grounds on a recommendation of the Bland Committee. Mr Deputy President, I seek leave to continue my remarks.
Leave granted; debate adjourned.
Senator GUILFOYLE (Victoria-Minister for
Social Security)- Pursuant to section 42 (d) of the Australian Citizenship Act 1948-73 I present the annual return of persons granted certificates of Australian citizenship during the year ended 30 June 1975.
– On behalf of my colleague the Minister for the Northern Territory and for the information of honourable senators I present the monthly reports on the Darwin Cyclone Tracy Relief Trust Fund for October, November and December 1975 and January 1976. Due to the limited number available, reference copies of these reports have been placed in the Parliamentary Library.
– I seek leave to move that the Senate take note of these reports.
The DEPUTY PRESIDENT (Senator DrakeBrockman) Is leave granted? There being no objection, leave is granted.
I seek leave to continue my remarks.
Leave granted; debate adjourned.
-I bring up the fifty-first report from the Standing Committee on Regulations and Ordinances, it being a general report on the work of the Committee during 1975.
Ordered that the report be printed.
-Mr Deputy President, I ask for leave to move a motion that the Senate take note of the report.
The DEPUTY PRESIDENT-Is leave granted? There being no objection, leave is granted.
I wish to explain briefly to the Senate the nature of this report. It deals with the work of the Committee during 1975. It was drafted prior to the dissolution of the Senate. The present Committee has resolved to present it unaltered as a record of the work of the previous Committee. The report records the situation as it was in November last year. Where the report refers to undertakings to amend regulations and ordinances given by Ministers, it refers to Ministers of the previous Government. Some of these undertakings have not yet been carried out, but that is a matter which the present Committee is taking up with the new Ministers.
I would like to pay tribute to the excellent work of my predecessor as chairman of the Committee, Senator Devitt, who pursued the work of the Committee diligently and with the highest regard for the principles on which the Committee operates. I also pay tribute to those exmembers of the Committee who did such excellent work. Mr Deputy President, I ask for leave to continue my remarks.
Leave granted; debate adjourned.
Motion (by Senator Greenwood) agreed to:
That the Senate at its rising adjourn until Tuesday, 16 March 1976, at 2.30 p.m. unless sooner called together by the President or, in the event of the President being unavailable owing to illness or other cause, by the Chairman of Committees.
Motion (by Senator Greenwood)- by leaveagreed to:
That in accordance with the provisions of the Public Works Committee Act 1 969- 1 974, Senators Kilgariff, Melzer and Young be appointed members of the Parliamentary Standing Committee on Public Works.
Motion (by Senator Greenwood)- by leaveagreed to:
That, in accordance with the provisions of the Parliamentary Proceedings Broadcasting Act 1946-1974, Senators Sir Magnus Cormack and Douglas McClelland be appointed members of the Joint Committee on the Broadcasting of Parliamentary Proceedings.
Motion (by Senator Greenwood)- by leaveagreed to:
That, in accordance with the provisions of the Public Accounts Committee Act 1951-1973, Senators Baume, Colston and Messner be appointed members of the Joint Committee of Public Accounts.
Motion (by Senator Greenwood)- by leaveagreed to:
That a Committee of Privileges be appointed to consist of Senators Button, Drake-Brockman, Jessop, O ‘Byrne, Thomas, Wheeldon and Wright.
Motion (by Senator Greenwood)- by leaveagreed to:
That notwithstanding anything contained in the Standing Orders a Standing Orders Committee be appointed to consist of the President, the Chairman of Committees, Senators Brown, Chaney, Sir Magnus Cormack, Greenwood, McAuliffe, Douglas McClelland, O’Byrne, Webster and Withers.
Motion (by Senator Greenwood)- by leaveagreed to:
That a House Committee be appointed to consist of the President and Senators Coleman, McLaren, Melzer, Messner, Sheil and Young.
Motion (by Senator Greenwood)- by leaveagreed to:
That a Publications Committee be appointed to consist of Senators Archer, Bonner, Donald Cameron, Missen, Robertson, Ryan and Tehan.
Motion (by Senator Greenwood)- by leaveagreed to:
That a Library Committee be appointed to consist of the President and Senators Donald Cameron, Davidson, Gietzelt, Harradine, Mulvihill and Walters.
The DEPUTY PRESIDENT (Senator DrakeBrockman) I have received a message from the House of Representatives acquainting the Senate that, in accordance with the provisions of the Parliamentary Proceedings Broadcasting Act 1946-1974, in addition to Mr Speaker, the following members of the House of Representatives have been appointed members of the Joint Committee on the Broadcasting of Parliamentary Proceedings, namely, Mr Donald Cameron, Mr Corbett, Mr Graham, Mr Scholes and Mr Antony Whitlam.
The DEPUTY PRESIDENT- I have received a message from the House of Representatives acquainting the Senate that, in accordance with the provisions of the Public Accounts Committee Act 1951-1973, the following members of the
House of Representatives have been appointed members of the Joint Committee of Public Accounts, namely, Mr Armitage, Mr Connolly, Mr Dobie, Mr Innes, Mr Lusher, Mr Martin and Mr Short.
The DEPUTY PRESIDENT- I have received a message from the House of Representatives acquainting the Senate that, in accordance with the provisions of the Public Works Committee Act 1969-1974, the following members of the House of Representatives have been appointed members of the Paliamentary Standing Committee on Public Works, namely, Mr Bungey, Mr James, Mr Keith Johnson, Mr Kelly, Mr Les McMahon and Mr Millar.
Bill received from the House of Representatives.
Ordered that the Bill may be taken through all its stages without delay.
Bill (on motion by Senator Cotton) read a first time.
– I move:
The Leader of the Opposition (Senator Wriedt) has indicated to me that he would be prepared to allow me to incorporate my second reading speech in Hansard. I am quite happy to do that, as long as it is the wish of the Senate. This is a measure of some importance, with which the Senate dealt last year for quite a long time. I have no wish to pay any discourtesy to my colleagues. If it is the wish of the Senate, I ask for leave to have the second reading speech incorporated in Hansard.
The DEPUTY PRESIDENT-Is leave granted? There being no objection, leave is granted. (The speech read as follows)-
The purpose of this Bill is to provide part of the necessary legislative authority to meet a prospective deficit in the Consolidated Revenue Fund in 1975-76. A further Bill which 1 will be bringing forward shortly, the Loan Bill (No. 2) 1976, will provide the further legislative authority required to complete the financing of the deficiency in that Fund. The borrowing authority provided for in this Bill and the Loan Bill (No. 2) 1 976 to which I have referred is also required for the financing of the overall Budget deficit for the year. Many honourable senators will, no doubt, recall that the previous Government introduced legislation into Parliament in August 1975 designed, at the time, to serve similar purposes. I refer to the Loan Bill 1975. In the event, that Bill was not passed before the dissolution of Parliament but a lot of detailed and useful information on Loan Acts, their purposes and form, was made available to the Parliament particularly in answer to questions raised in this place. Much of that information remains relevant to these Bills.
Obviously the Budget deficit of the Commonwealth must be financed in one way or another. Except insofar as funds are available from sources such as accumulated cash balances or other minor financing transactions the deficit must be financed by net borrowings undertaken within proper authority from the Parliament and, as necessary, from the Loan Council. Underlying that overall picture is the legal division, as provided in the Audit Act, of the Commonwealth’s accounts into 3 separate funds- the Consolidated Revenue Fund, the Loan Fund and the Trust Fund. The amounts which may be paid from any of these funds is limited to the amount legally available to it.
The overall deficit for the year was estimated at $2.8 billion when the Budget for 1975-76 was tabled by the previous Government. Within the total there was an estimated deficiency of $1.15 billion in the Consolidated Revenue Fund after allowing for expenditures on a number of programs such as capital assistance grants and housing assistance to the States to be charged to Loan Fund rather than the Consolidated Revenue Fund. The Loan Bill proposed by our predecessors was designed to overcome that prospective deficiency in the Consolidated Revenue Fund by authorising the transfer of defence expenditures to Loan Fund to the extent necessary for this purpose. These transferred expenditures were to be financed by borrowings for defence purposes. Such borrowings do not require Loan Council approval.
However, it soon became very clear that the prospective overall deficit and the deficiency in the Consolidated Revenue Fund had been grossly under-estimated. By December it was apparent that the overall deficit for the year could exceed $4.5 billion, with the Consolidated Revenue Fund deficiency showing a similar increase. With subsequent revisions of the Budget estimates, and before allowing for the Government’s economy measures an overall deficit of the order of $4.7 billion and a deficit of close to $3 billion in the Consolidated Revenue
Fund were in prospect. While this Government has moved quickly and vigorously to contain expenditure and rein in the unconscionably large deficit we inherited, there are clearly limits to the reductions in planned expenditures that can be effected within a relatively short period.
With only a few months remaining of the financial year and a deficit of over $4 billion for the first 7 months already recorded, it is inevitable that the deficit for the year as a whole will be very considerably greater than was originally envisaged. The deficiency in the Consolidated Revenue Fund is similarly inflated. It is, essentially, the prospective Consolidated Revenue Fund deficiency that creates the financing problem. Appropriate legislative authority is needed to permit us to overcome the prospective shortfall in that Fund before the end of the financial year. This can be achieved in two broad waysone is by transferring further expenditures from the consolidated Revenue Fund to the Loan Fund where they can be financed from borrowing, and the other is by supplementing Consolidated Revenue Fund receipts through payment of moneys into that Fund from the Loan Fund or from the Trust Fund. When adequate legislative authority is available for borrowings to cover the potential deficiency in the Consolidated Revenue Fund and borrowings to cover expenditures which would in any case be charged to Loan Fund, there will be adequate legislative authority to complete the financing of the overall deficit.
The Government has carefully examined the options available to it to meet the difficult deficit situation it has inherited and it has decided on a package of 3 measures. First, we propose to supplement Consolidated Revenue Fund receipts, and thereby reduce the size of the prospective Consolidated Revenue Fund deficiency, by paying into that Fund unrequired balances held in the National Welfare Fund Trust Account. These balances amount to some $470 m and are currently invested in internal treasury bills. While this measure requires no legislative action, it is, I think, appropriate that Parliament be informed about it. Under the provisions of the National Welfare Fund Act the balances held by the National Welfare Fund Trust Account cannot be spent directly from the Fund. The 1952 amendment to the National Welfare Fund Act provided a standing appropriation for the automatic replenishment of the National Welfare Fund Trust Account in respect of any moneys paid from the account for social services. This means that, as moneys are paid out, they are simultaneously recouped from special appropriations of the Consolidated Revenue Fund. Obviously, in these circumstances, no working balance is required in the Trust Account. The Audit Act provides a procedure whereby moneys not required for the purposes of a Trust Account may be transferred to the Consolidated Revenue Fund upon determination by the Treasurer. It is intended that the internal treasury bill holdings of the National Welfare Fund Trust Account be redeemed. The cash resulting from the redemption of the internal treasury bills will be paid direct to the Consolidated Revenue Fund. It is, of course, from the Consolidated Revenue Fund that all expenditures on social security are now met. I should also make clear to honourable senators that nothing in this proposed procedure will in any way affect present or future social security or health benefits.
The second measure proposed is represented by the Loan Bill 1976. As has been said in this Parliament on many occasions in the past, the traditional procedure adopted by successive governments to cope with a prospective deficiency in the Consolidated Revenue Fund has been to charge defence expenditures to the Loan Fund and to borrow to finance the expenditures so transferred. The Loan Bill 1976 is designed to permit this traditional procedure to be followed in the remaining months of this financial year. The Loan Bill authorises borrowings for defence purposes, but it does not authorise additional defence expenditures. It will simply allow the reallocation from the Consolidated Revenue Fund to the Loan Fund of defence expenditures which are yet to be made and which are authorised by Parliament in Appropriation Act (No. 1) 1975-76 and in any additional appropriation Acts for this Financial year. In these respects the Loan Bill 1976 is similar to the Loan Bill 1975 introduced by the previous Government. However, there is one important point of contrast between the two pieces of legislation. The Bill proposed by our predecessors prescribed no specific monetary limit on the borrowings for defence purposes that could be undertaken under it- that is, outside the Jurisdiction of the Loan Council. The Bill I am speaking on contains a specific limit of $700m. I should make it clear that the limit of $700m is estimated to be sufficient to permit all relevant defence expenditure in the remaining months of the financial year to be charged to Loan Fund and financed by borrowings authorised under this Loan Bill 1976 after its enactment.
After allowing for the measures I have outlined so far, a substantial residual deficit in the Consolidated Revenue Fund could still be expected. To cover this deficiency a further Bill, the Loan Bill (No. 2) 1976, will be brought forward to provide legislative authority to meet that residual deficit. In order to give honourable senators the complete picture of the financing of the deficit I will outline the essential characteristics of the Loan Bill (No. 2) 1976 now. That Loan Bill to be introduced into the Senate shortly will authorise the borrowing of such further amounts as are necessary to complete the financing of the Consolidated Revenue Fund deficit and the payment of the proceeds of these borrowings from the Loan Fund to the Consolidated Revenue Fund. I mention here that procedures of this type are not without precedent. The Loan Acts 1914 and 1931 each authorised borrowings for payment to the Consolidated Revenue Fund.
There is, inevitably, considerable uncertainty as to what size the residual deficiency in the Consolidated Revenue Fund will be. It will depend upon the effects of future events on all receipts and expenditures of that Fund. Even in the closing days of the financial year the final result can be heavily affected by, for example, the timing of receipts of large tax payments. For this reason the Loan Bill (No. 2) 1976 will not specify an upper numerical limit to the amount which may be borrowed. Instead, authority will be provided for the Treasurer to borrow such amounts as he considers to be the likely maximum necessary to avoid a deficit in the Consolidated Revenue Fund. While this may on the surface appear to be no different to an open-ended borrowing authority in a Loan Bill authorising borrowing for defence purposes, there is in fact a very important difference.
The borrowings under the Loan Bill (No. 2) 1 976 will not be for defence purposes and will, as a consequence, have to be within the limit of borrowing authority approved for the Commonwealth by the Loan Council. In this regard I mention that, in order to ensure that the extent of borrowing authority available from the Loan Council will be fully adequate to cover borrowings under Loan Bill (No. 2) 1976, when it is enacted, the Treasurer has already consulted other members of the Loan Council and has obtained their agreement to an appropriate increase being made in the approved borrowing program for the Commonwealth. Finally, I think I should make it clear that it is not expected that any of the borrowing authority in the proposed Loans Bills will be used to authorise overseas loan raisings.
The additional legislative authority given by the 2 Bills will be utilised as part of the legislative cover for the proceeds of public loan raisings allocated to the Commonwealth to the extent these are not charged against other specific authorities. In addition, these Bills will provide legislative cover for any necessary residual borrowings from the Reserve Bank. In line with the Government’s overall economic objectives, we will, in undertaking the borrowings required, continue to seek to achieve further sales of securities to the public, especially the non-bank public to the extent that this can be done without impairing sound recovery of activity in the private sector.
In conclusion, I point out to honourable senators that the procedures required to meet the Consolidated Revenue Fund deficiency and to complete the financing of the overall deficit are more complex than usual largely because of the very magnitude of the deficit problem we have inherited. While we are doing what is possible to rein in that deficit, it cannot be rectified overnight. I commend the bill to honourable senators.
Debate (on motion by Senator Wriedt) adjourned.
Bill received from the House of Representatives.
Ordered that the Bill may be taken through all its stages without delay.
Bill (on motion by Senator Cotton) read a first time.
– I move:
This Bill is to be taken in conjunction with the first Bill and it depends upon the first Bill. If the Senate is agreeable, I ask for leave to have the second reading speech incorporated in Hansard.
The DEPUTY PRESIDENT-Is leave granted? There being no objection leave is granted. (The speech read as follows)-
As I foreshadowed in my speech on the introduction of the Loan Bill 1976 the purpose of this Bill is to provide the necessary legislative authority to meet a residual deficiency which would remain in the Consolidated Revenue
Fund in 1975-76 in the absence of further legislative action and also to provide the necessary additional borrowing authority to complete the financing of the overall Budget deficit for the year. Honourable senators will recall that in my second reading speech introducing the Loan Bill 1 976 1 outlined in some detail all of the measures proposed to meet the unprecedented deficit situation we have inherited. I explained the need for this second Loan Bill and discussed its characteristics. As I indicated then, this Bill authorises the borrowing of such further amounts as are necessary to complete the financing of the Consolidated Revenue Fund deficit and the payment of the proceeds of these borrowings from the Loan Fund to the Consolidated Revenue Fund.
The eventual size of the residual deficiency in the Consolidated Revenue Fund will depend upon the effect of future events on all receipts and expenditures of that Fund. For this reason the Bill does not specify an upper numerical limit to the amount which may be borrowed. Instead, authority is provided for the Treasurer to borrow such amounts as he considers to be the likely maximum necessary to avoid a deficit in the Consolidated Revenue Fund.
Borrowings under this Bill are, however, subject to the jurisdiction of the Loan Council. They will, therefore, have to be within the limit of borrowing authority approved for the Commonwealth by that body. In this regard I mention that, in order to ensure that the extent of borrowing authority available from the Loan Council will be fully adequate to cover borrowings under Loan Bill (No. 2) 1976, when it is enacted, the Treasurer has already consulted other members of the Loan Council and has obtained their agreement to an appropriate increase being made in the approved borrowing program for the Commonwealth.
Finally, I emphasise that this Bill does not authorise any additional expenditure apart from expenses of borrowing. The moneys raised under the Bill will be paid into the Consolidated Revenue Fund from which they will be used to finance general expenditures which have been authorised by appropriation Acts passed by Parliament. I commend the bill to honourable senators.
Debate (on motion by Senator Wriedt) adjourned.
Bill received from the House of Representatives.
Ordered that the Bill may be taken through all its stages without delay.
Bill (on motion by Senator Cotton) read a first time.
– I move:
I think it might be better if I were to read this second reading speech because there is a lot of interest in the chamber in this Bill. The purpose of this Bill is to suspend the meat export charge from 1 March 1976. The legislation under which the charge is imposed was introduced in November 1973 and is due to expire in June 1976. Currently the charge is lc per lb on exports of meat and edible offals and is intended to recoup the cost to the Government of export meat inspection. In addition there is a further charge of” 0.6c per lb on beef and veal only for the purpose of recouping the Government’s contribution to the brucellosis and tuberculosis eradication campaign.
When the meat export charge legislation was passed in 1973, world demand for meat was strong and prices, especially for beef, were at extremely high levels. This is in marked contrast to the present situation, in which there are restrictions on imports of meat in some of our major overseas markets. Furthermore, prices for beef have been depressed for a prolonged period, and despite some improvement in recent months still remain low. At the same time inflating costs have seriously affected all sectors of the industry. As a result for more than 12 months the financial position of producers has been very serious. Following its examination of the difficult situation facing the beef industry, the Industries Assistance Commission made a number of recommendations on assistance to cattle producers. One of the recommendations was to suspend the export charge on beef and veal. In recognition of the serious financial position facing the industry the coalition parties undertook to implement this recommendation in their election policy program. The Government has now decided to go further and to remove the charge on all meats, not just beef and veal. The purpose is to ensure that there should be an immediate improvement in prices paid for livestock. For this reason, while the immediate benefit will be to exporters it is expected that the maximum benefit of the lifting of the charge will be returned to producers. They alone have been subject to an inability to pass on increases in costs. It would therefore not be tenable that they should now be denied the benefit of the lifting in the export charge. The Government is acutely aware of the importance to the meat industry of export meat inspection services and of the brucellosis and tuberculosis eradication campaign. Removal of the export charge will not affect the services provided.
In regard to the eradication campaign, I have already announced that the Government intends to introduce a levy of $1 per head on cattle slaughtered in Australia from 1 July next, the funds from which will be used to offset the Government’s contribution to the campaign. This slaughter levy will be effected by separate legislation to be introduced in the current session of Parliament. The revenue from the $1 per.head slaughter levy will in a year raise approximately the same amount as the 0.6c per lb export charge. It is believed that by spreading it over all cattle slaughtered it will be more equitably shared, that is, the cost of eradication will be borne by all sections of the industry who must ultimately benefit from it. I commend the Bill to honourable senators.
Debate (on motion by Senator Walsh) adjourned.
Debate resumed from 2 March on motion by Senator Cotton:
That the Bill be now read a second time.
-The Opposition does not oppose this legislation. This Bill, of course, was brought in originally by the previous Government and is expressed now in virtually identical terms. Certainly the substance of the Bill has not been changed from last year. The purpose of the Bill is to make the States payments amounting to approximately $430m which is part of a continuing program of assistance to the States commenced under the present arrangements about five or six years ago. This Bill in substance is seeking to alleviate the problems of the States, their debt and general financing problems. It is designed to assist them as much as possible in the burden which they carry in respect of debt payments. It is not a Bill which I feel will excite a great deal of debate in this chamber. Later we will be dealing with other Bills involving financial assistance agreements with the States and I imagine that on those occasions we may have grounds for more substantive debate on the present CommonwealthState financial position.
As we know, the States have been suffering an increasing debt burden for many years. It is a matter of concern to all political parties and governments in Australia that that burden has increased much more dramatically for the States than it has done for the Federal Government itself. This measure, amongst others, is designed to improve that position. Notwithstanding the very long and telling debates which have taken place in this Parliament over the years the problem between the Federal and State governments has never been resolved. I feel it would surely be the purpose of all of us to go as far along that path as we possibly can. Not only is it a question of the problems of the States collectively; it also concerns problems between the States themselves. It is said- and I think fairly said- that over the years much has been done to endeavour to bring about an equitable arrangement with the States. However, because of the complexity of the formulas and the matters which must be taken into consideration, it is a very difficult objective to achieve. Nevertheless, those inequalities still remain between the States.
We find, for example, the interesting fact that per capita payments to some States remain considerably higher than payments to other States. The smaller States especially carry a bigger burden. These are the problems which it has been impossible for any government to overcome, even over the many years that these arrangements have been operating. Yesterday afternoon in the Address-In-Reply debate we heard Senator Carrick make some very strong statements about the specific purpose payments which were made by the previous Government to the States. That is a matter on which we could have a lengthy debate on this occasion. Perhaps we can defer discussion on that matter until the financial agreement legislation comes before the Parliament.
It ought to be recalled- I draw the attention of the Senate to this fact- that irrespective of the breakdown of specific purpose payments or general purpose payments made by the previous Government, under that Government we saw the largest increase in payments to the States made by any federal government. This was apparent last year when we saw a net increase of 38 per cent in federal government payments to the States. One can legitimately argue whether the percentage increase should have been in the area of general purpose payments or specific purpose payments. I am not aware that any of the States rejected any of the moneys which were made available to them during the 3 years of the Labor Government. Perhaps I am getting away from the essential point of this legislation. There is nothing more that I wish to say in respect of it. The intent of the Bill is quite clear. Both the Government and the Opposition, I believe, are in complete agreement insofar as the amount to be paid and the method by which it is to be paid are concerned. As the Government wishes this Bill and another Bill to be passed today I will not add to my comments except to say that this legislation is of benefit to the States themselves. It is legislation of which I am sure we will see more in the years ahead.
– I wish to speak briefly on this legislation. As Senator Wriedt has pointed out, and as the second reading speech has pointed out, the purpose of this Bill is to authorise the payment of that portion of the general purpose capital grants to the States which is funded by a grant from the Federal Government, as distinct from the remainder of the general purpose grants which are made by way of loan. I wish to make 2 points relating to the legislation. Firstly, the existing financial arrangements discriminate very heavily against the 4 outlying States of Queensland, South Australia, Western Australia and Tasmania. Secondly, the arrangement which is favourable to those States and which can be justified on both social and economic grounds is currently under threat by the undertaking given by the present Government in its new federalism policy published some 7 or 8 months ago, and the pre-election undertakings of the Prime Minister (Mr Malcolm Fraser) to implement that policy.
The basic objective, as enunciated by the present Government, is to make State governments responsible for raising the revenue which they spend. To achieve that objective fully, of course, entails the total elimination of financial redistributions from the Federal Government. Whether that step is comtemplated has not yet been made clear by the Prime Minister or any of his Ministers. To whatever degree the objective of making State governments responsible for raising the revenue that they spend is achieved and subsequently put into legislation, it follows inevitably that the 4 outlying States will be financially disadvantaged. It could be, of course, that this pre-election undertaking by the Liberal Government and the present Prime Minister may ultimately be as worthless as the present Prime Minister’s undertaking that he would not oppose Mr Snedden for the Liberal Party leadership; that the Budget would be passed; that it was his strongly held belief that a deceased senator should be replaced by a State government with a senator from the same party; his preelection promises on wage indexation; and his pre-election promises of integrity in government.
It may well be that this new federalism and the Prime Minister’s assurances on this policy of new federalism are as worthless as all of those other undertakings he has given in the last 1 2 months. In case it is not, it is worth examining the financial implications of the policy. In particular, I would recommend that honourable senators from our outlying States- from my own State and, in particular from the State of Tasmania and especially Senator Walters who spoke in the debate on the Address-in-Reply yesterday at some length on the alleged financial disadvantages currently inflicted upon Tasmania- should consider the ramifications of new federalism for their States. Senator Walters should consider the very real and crippling financial burdens which that policy will impose upon Tasmania should it ever be implemented.
I should like to refer to figures published in Budget Paper No. 4, page 1 84 of last year- the distribution on a per capita basis of funds under general purpose capital grants to the States, semi-government and local government authorities of which one-third is funded by this legislation. The difference between the national average per capita and the distribution to Tasmania under this heading is $ 124. To equalise that distribution in the way that the new federalism infers- such distribution will be equalised or eliminated altogether- will disadvantage Tasmania to the extent of about $50m. In the 1975-76 Budget Paper No. 4, page 145 which deals with the summary of all payments to the States, we find that the average per capita total payments to the States on a national basis was $441 per head. Western Australia received $108 above that national average- this is in 1974-75- and Tasmania received a staggering $248 per capita above the national average.
That does not tell the whole story. If we look at the revenue side, we find that tax collections on a per capita basis are significantly higher in the States of New South Wales and Victoria. The last year for which published figures are available in the Taxation Commissioner’s report is 1972-73. Personal income tax collections per capita in Victoria were $302 and in Tasmania, $248. In summary, the net effect of the full equalisation- the full achievement of the Fraser Government’s stated objective of making State governments fiscally responsible and of making State governments responsible for raising the money which they spend- on both the revenue side and the redistribution from Federal sources side to the State of Western Australia, when the figures are updated, will be about $200m a year. For Tasmania, it will be about $120m a year. Of course, on a per capita basis, that is much more severe for Tasmania.
I commend to all Tasmanian senators, in particular, a deep study of this subject. It is clear, of course, that Senator Rae has long realised the implications and the fiscal threat in this policy to the State which he purports to represent or does represent. No doubt that was one of the significant reasons why Senator Rae fought tooth and nail to protect Mr Snedden from the surreptitious attack on his leadership which was launched by the present Prime Minister less than 1 year ago. Senator Rae, of course, is not the only non-Labor politician in Australia who has recognised the threat to the smaller States implicit in this legislation. Mr Kevin Cairns, the member of the House of Representatives for Lilley in Queensland, some months ago went on public record in terms highly critical of the legislation. He added that it was a further manifestation of the fact that economic decision making in the Liberal Party was centralised in Melbourne, with a little bit left over for Sydney.
Sitting suspended from 12.46 to 2.15 p.m.
- Mr Deputy President, in view of the fact that I wish to intervene and put down a statement which I think most honourable senators will want to hear, I move:
Question resolved in the affirmative.
– by leave- I thank the Senate for its courtesy and I apologise for not being in the chamber this morning to make this statement at the appropriate time. I had been requested to be at the War Memorial when the King and Queen of Jordan attended there.
Honourable senators will be aware that the entitlements of members of this Parliament, including Ministers and office holders, are presently determined by three authorities- the
Presiding Officers, the Remuneration Tribunal, and the Minister for Administrative Services. This has allowed a situation to develop whereby some entitlements are within the province of the executive Government or an individual. As well this had led to a situation whereby it is possible for the executive government to be in a position where it can compromise the independence and integrity of individual senators and members. The Government believes that the independence of individual members of the Parliament is vital to democracy. No senator or member should be beholden to the executive for his or her rights and entitlements. Senators and members are, and should be seen to be, responsible only to their electors. They should not be placed in a position where favours may, or may not, be provided or withdrawn at the will or the whim of the Government of the day. Such a situation would be offensive to every concept of parliamentary democracy in Australia.
It is the view of the Government that senators and members should be freed from day to day threat about how their capacity to serve their electors could be affected by the Government. There is no intention or desire on the part of the Government to interfere with the integrity of individual senators and members, or apply pressure in any way on them. However, the Government believes there should be a fail-safe system which effectively prevents the executive abusing its power, and effectively protects the integrity of senators and members in this Parliament. Honourable senators will recall that shortly after the Government came to power certain entitlements- such as life gold passes, overseas travel, and similar matter- were altered. This was done because the Government felt the method by which these entitlements had been given- that is, by executive decision- was not appropriate. The Government felt that any such entitlements should not be a matter for the executive government to provide. The Government was not making any decision on the appropriateness of the entitlements themselves. Its action was based purely on the methods by which the entitlements were provided. The Government, as I have already said, does not feel it proper that entitlements should be either concealed or be able to be provided or withdrawn at will. For this reason the Remuneration Tribunal will, except in exceptional circumstances which will be made public at the time, determine matters relating to the entitlements of senators and members. The Parliament will still retain the right of disapproval of any determinations made by the Tribunal.
I have now written to the Chairman of the Tribunal, Mr Justice W. B. Campbell, formally requesting him to make determinations on certain entitlements for members of the Parliament. I anticipate that the Remuneration Tribunal will make determinations and recommendations on the appropriateness of certain entitlements and the conditions which should apply to senators and members. I have asked the Tribunal to make determinations on the provision of travel within Australia for senators and members on parliamentary and electorate business and the travel facilities to be provided to spouses and children. I have also asked the Tribunal to make determinations on the use by senators and members of official car transport- in Canberra when on official business; when travelling to and from Canberra; in capital cities outside Canberra; and the provision of official car transport for spouses. The Tribunal has also been asked to consider the provisions currently provided for private vehicle allowances, and for the use of drive-yourself vehicles and charter aircraft. In addition, I have requested the Tribunal to consider the qualifying period for provision of life gold passes- a provision which currently stands at one year’s service for a Prime Minister, three years for Ministers, the Presiding Officers and Leader of the Opposition in the House of Representatives and 20 years or service in seven Parliaments for private members. I have also asked the Tribunal to consider a number of matters relating to office and similar facilities for senators and members. These are the provision of home telephones, the Federal Members Authority telephone card, the extent of postage allowances, and the provision of staff. In addition, the Tribunal has been asked to look at overseas travel facilities for senators and members.
Finally, I have asked the Tribunal to bring down recommendations on certain aspects of the retiring allowance and superannuation provisions provided to senators, members and Ministers. This relates to the present situation in which a person may be entitled to one or more Commonwealth pensions plus a parliamentary retiring allowance. The Government believes this is a further question on which the Tribunal should be asked to provide advice. Mr President, the Tribunal will now, for the first time, carry out a comprehensive study of exactly what entitlements should be provided to senators and members. The Government believes this will be of major importance to our democratic parliamentary system. No longer will senators and members be subject to the whim of the executive; nor will their entitlements be capable of being hidden from the people- the taxpayers and the voters- to whom they are responsible. I have asked the Tribunal to make its determinations by 31 March 1976. Honourable senators will notice that the time limitation is somewhat short. No doubt there may be a number of senators and members who would wish to make submissions on these matters to the Tribunal. Should they wish to do so through me, I will ensure they reach the Tribunal expeditiously. I move:
– There are a couple of matters that I wish to raise in connection with the statement of the Minister for Administrative Services (Senator Withers) in relation to which he has moved that the Senate take note of the paper. In case it is inferred from a Press statement issued by the Minister shortly after the present Government came into office or from his present statement that the Labor Government in any way was lavish in the manner in which it dealt with the rights and entitlements of parliamentarians, I want to say at the outset that members of this Parliament owe a debt of gratitude to the Minister for Services and Property in the Labor Government, the Hon. Fred Daly. He had the political courage- I emphasise those words- to make great improvements in the standards and working conditions of members of the Australian Parliament. I make that statement as a member of the Labor movement and on behalf of my colleagues, but I know that the sentiments are echoed by a great number of Government members in both the House of Representatives and the Senate.
– Hear, hear!
– I hear Senator Jessop echoing those sentiments by saying ‘Hear, hear!’ I think it was the honourable member for Griffith in another place, Mr Donald Cameron, who once said that parliamentarians owed a lot to Fred Daly for the way he had fought to improve the the status of the Australian Parliament. Only a week or so ago Mr Kevin Cairns, the Liberal member for Lilley, gave to his newly won friends in the Parliament the sage advice that not too many members of today seem to think about the members of yesteryear. Bearing in mind how often there is criticism of anyone who tries to do something to improve the standards, status and dignity of the Parliament, we all owe a lot to Mr Daly.
The reforms which Mr Daly instituted, and they were reforms, were implemented not merely at his behest or at the instigation of members of the then Government. I know of my own knowledge that some of the reforms and improvements that he implemented were advocated to him by members of the Labor Party, the Liberal Party and the National Country Party. I emphasise that I personally have great enthusiasm for the work that Mr Daly did in order to improve the lot of the Australian Parliamentarian.
I could speak at length about some of the matters raised by the Minister for Administrative Services in his statement, but I do not intend to do that. Firstly, let me say that I think that the provisions which were in force at the time of the election and when this Government came into office should have remained in force until such time as they were taken away following an inquiry by and recommendations from the Remuneration Tribunal. The fact that they have been taken away or suspended for the time being by this Government, I hope, will not affect any recommendation or determination that the Tribunal may make. In any event, as the Minister has said, the Parliament will retain the right to disallow any determinations that are made by the Tribunal. I hope that the matters that were previously conditions of parliamentarians and which are now not conditions of parliamentarians will be looked at by all parliamentarians when they come to present evidence to the Tribunal. After all, such matters as life gold passes were always matters for Executive determination, as I am sure the Minister for Administrative Services will agree.
– The last determination came out of the Richardson report.
-They came out of the recommendations contained in the Richardson report, but it was not a determination.
– The last lot came out of the Executive.
-The last lot was made by the then Minister for Services and Property. I am sure that the Minister will agree that it was within the ambit of the Executive to make such a determination. Again I say that it is regrettable that that determination by the Executive has been countermanded by the new Government before these matters have been referred to the Remuneration Tribunal.
Now that the Minister has made the decision to refer all of these matters to the Remuneration Tribunal for determination, I hope that all present members of the Parliament will take an interest in the proceedings of the Tribunal and also that because former members of the Parliament are involved a copy of the Minister’s statement will be sent to all former members of the Parliament so that if they desire to present any views to the Tribunal they will be able to do so. I suggest that all members of this Parliament take a very active interest in this matter. 1 wish to see the preservation of the working conditions of all members of the Australian Parliament. I do not want to see a situation in which, because of financial reasons, travel abroad for members of the Australian Parliament is restricted to members of the Executive only- that is, members of the Cabinet and the Ministry.
The other aspect that I mention is that there should be no attempt on the part of the Government to disallow any determination of the Tribunal after a thorough and detailed hearing by that body. In its 1975 review, the Tribunal emphasised that it is not legally possible for the Parliament to disallow a determination in part. All of the determinations of the Tribunal must be accepted, or none at all. I think that the Tribunal already has made 3 determinations in respect of parliamentarians and statutory office holders. Two of those determinations have been disallowed by the Parliament- one in March 1974 and the other as recently as August of last year. I trust that all of the matters relating to the entitlements of present members and former members which were suspended or abolished by this Government, including those which were mentioned specifically in the statement by the Minister of 19 December 1975, are being referred to the Tribunal for determination and /or recommendation.
– I commend the Minister for Administrative Services (Senator Withers) for presenting this statement and for indicating that these privileges are to be put on a proper basis. Let me say that Mr Daly, the Minister for Administrative Services in the last Government, was more considerate of the needs of backbenchers of this Parliament than any other Minister has been in the whole of the 26 years that have elapsed since I was elected to the Senate. There is no question about it: The previous Government- my own Governmentcontained Ministers who were most miserable in many respects towards the entitlements of back benchers. They looked after their own entitlements, but they failed to think about the needs of back bench senators and members. It took Mr Daly to make them realise that something more was necessary.
Those Ministers are not the only ones who are guilty in that respect. The former Prime Minister, Mr Whitlam, took it upon himself- I know his action was very much against the feelings of many members of the present Opposition who were then in government- to reduce the standard of air travel for members of Parliament from first class to economy class. It is very easy for people to do these sorts of things when their actions do not concern them. The inconvenience that they cause to others does not matter to them; they like to dictate to ordinary members. I have noticed that they look after themselves very warmly and very generously. For instance, honourable senators will notice that at present in order to qualify for a life gold pass a back bench senator or member has to be a member of this Parliament for 20 years or the life of 7 parliaments. But a Minister is such a marvellous person that he qualifies for a life gold pass after 3 years. Of course, a Prime Minister is such a super wonderful person that he receives a life gold pass after 12 months in office. These provisions are disproportionate. I do not think that the average back bench senator wants any extraordinary entitlements. What the average back bench senator wants is a fair deal- a fair deal compared with what is received by those who are in more exalted positions.
Dealing with my own case, I am not a snob with respect to travel. In my home city, I do not own a motor car; I get around on a pushbike. No one can claim that I am a snob when it comes to travel. But when I travel by plane I like to travel in comfort. Because of the length of one’s legs, one likes to have sufficient leg room. The other aspect to consider when one is travelling long distances is where one obtains a meal. The situation is all right for people like Mr Whitlam and others who live handy in Sydney. Previously he had VIP aircraft in which to travel. Those who travel long distances from Queensland, Western Australia and Tasmania -
– And South Australia.
– Yes, and South Australiathe needs of those people are not accommodated as easily as those of people who travel short distances. This matter should be looked at, and it should be looked at fairly. I feel that the time has come to reconsider this matter. I hope that each and every senator and member will write to the Tribunal and put his or her case. If members of Parliament are silent on this matter, it will be overlooked. I think that members of Parliament should write to the Tribunal putting their cases on this matter.
Let me give a striking illustration of how members of Parliament are treated. I have noticed for years the number of cars that stand outside Parliament House waiting for Ministers, their secretaries, the girls on their staffs and so on. When I passed through Sydney en route to north Queensland, I noticed that girls from ministerial staffs had cars provided for them. What was the situation when I reached my home city? For a great many years- the situation changed only when Mr Anthony became Minister for the Interior, as the portfolio was then called- I had to find my own way to and from the airport in my home city. If I got off the aircraft in Sydney I noticed that there was no car for the members but girls on the office staff and on ministerial staff had been provided for. Our Leader, Senator Withers, has given the Opposition an opportunity to have this matter put on a proper basis. I think that each and every one of us, if we desire, should present our case to the Remuneration Tribunal so that we can get clarification and a proper settlement of this matter. I was seriously disturbed at the attitude of the Government in wiping out the amount of money which had been set aside for overseas travel. Whether it was right or wrong or over-generous- and it was- does not matter. The previous Minister had arranged for this amount to be provided during the life of each Parliament. Some parliamentarians had not used up their entitlement, which they were able to accumulate for 2 years. Other parliamentarians had used all or most of their allocation. This entitlement was wiped out at the stroke of a pen. Those who had not used their allocationthere were a lot of members, including myselfhad no opportunity to use it at all. In that way I think an inequality built up among the politicians. There were those who jumped in and got their allocation and those who, probably for other reasons, could not act immediately and so lost it. This indicates that there has to be a sense of fairness in dealing with these things.
As far as overseas travel is concerned, I do not think I could be said to be one of the greedy ones. I am serving my twenty-seventh year here and until about 18 months ago I had one government trip overseas. I think that is a record which could not be outshone by anybody in the chamber. The only reason why I received my next trip, as I think the former Whip here could tell honourable senators, was that one of our members who had been selected to go to a Commonwealth Parliamentary Conference at Sri Lanka cancelled for his own reasons and I was requested to fill that vacancy. Nobody can say that I have been a shark as far as overseas trips are concerned. If honourable senators look at the record they will see that I am the lightest of all in weighing on the Government. These facilities have to be thought out properly. When they are established they should be fixed and they should not be removed, as the Minister said, at the discretion of the Minister or of the Executive.
Now that the situation has arisen in the way in which it has, I think the Minister has done the sensible and practical thing. It is up to each and every one of us to write to the Tribunal so that the idea behind the Minister’s report today is carried out to the fullest and so that each and every one of us can get what is regarded as a fair amount of privilege as members of Parliament. If I travel at my own expense overseas or anywhere else, I travel first class. An attitude has built up that if one goes to the Federal Parliament one really downgrades oneself. I understand that the State parliamentarians travel first class. They have certain privileges which we do not have. We should not downgrade ourselves. Therefore I press each honourable senator here to make his request to the Tribunal for what he really thinks he is entitled to.
-The Opposition sees the recommendation that the entitlements of members of parliament be referred to the Remuneration Tribunal as being a very positive and constructive move. I want to add my protest to that of Senator Wood. I take exception to the arbitrary methods used by this Government to take away quite a few of the entitlements of members of Parliament without referring the matter to the Tribunal. The Minister for Administrative Services (Senator Withers) said that some of the entitlements were granted by the Minister for Administrative Services or by executive action. This is true. This has been the practice since Federation. The Minister or the Executive Council saw the need for entitlements to be granted. Previously, there was no Tribunal.
It has been my experience over a longer period than that for which Senator Wood has been here to see every recommendation which has ever been brought into the Senate or into the House of Representatives opposed by people who did not understand the nature of a parliamentarian’s expenses or his work. Such people have been seeking headlines. Ever since a parliamentarian has been receiving £750 I have seen people get up and say that parliamentarians were getting too much. Others have said the time was wrong, that salaries should not be mentioned, and that the newspapers would make headlines out of the matter. I am certain that if the people of that ilk had had their way members would still be receiving £750 a year. The situation got to the stage where people were joking about some of the old stagers who were perennial opposers. One man was suspected of having a granddaughter named Charity because he would say: ‘I will take it, but I will give to to charity’. One finds that after these people oppose a measure they are the first to go along and put their hand out.
– They register their own charity.
– That is right. The same thing applies now to air travel. I think it is an insult to members of Parliament that they have to be cramped up, especially to those who travel long distances. It is the responsibility of the nation and of the people to supply facilities for their members to bring them to Parliament. Members of Parliament should be equal to any other member in the community. They should not be treated like second-class citizens. Honourable senators from Western Australia, Queensland and to a certain extent from Tasmania- we do not have connecting servicesare cramped up. All the aircraft should be called Friendships, because we are almost sitting on one another’s laps in some of the cramped economy seats. There is very close friendship but it is not very good for the comfort and relaxation which members should have on their travels. Travelling economy class may have saved some small amount of money but it did not gain anything in upholding and maintaining the prestige of members of Parliament.
Some members objected very strongly to this treatment from the Government. They paid the difference so that they could travel first class. That is fair enough. I suppose everyone could pay the difference, but why should they? Whenever business organisation in the community requires its employees, directors or any of the people associated with it in an advisory capacity to travel, it treats these people like ordinary citizens, like human beings, instead of second class citizens. We should be speaking out on behalf of some of the new honourable senators such as those from the Northern Territory. They certainly should be given first-class facilities. They should be given the proper food and not the rubbish which is handed out to the second-class passengers. Senator Chaney spoke about the sloppy pack which is pushed out to the passengers.
– I knew I would make my mark eventually.
– The honourable senator has certainly made it as far as this business is concerned. The same remarks apply to transport. Most business organisations provide their employees with transport. Anyone would think it was a great privilege or honour to be able to get transport. It is as necessary today as soles on one’s shoes. One just has to get from point A to point B. Of course, one can walk. I suppose one can even go on one ‘s hands and knees if pressed. I do not think that a big issue should be made of the use of such transport when one is engaged in parliamentary duties elsewhere or in Canberra. Transport facilities should be made available to members of Parliament when they are away from their own transport. Members of Parliament have their own methods of transport at home, but once they leave their homes to attend the Parliament they must have another form of transport and it should be made available to them.
I turn now to the subject of superannuation. Some members of Parliament have been paying into the superannuation fund for members of Parliament for many years. For instance, Senator Wood has been paying into such a fund for 27 years. After a certain period he reached the maximum level but, like every other member of Parliament, he still continues to contribute to the fund. He is still making payments to the fund despite the fact that there is no accumulation of benefits after a certain point is reached.
– A couple of thousand dollars a year.
-Senator Wood pays $2,000 a year; that is true. These are matters that possibly are now the responsibility of the Tribunal but no consideration has been given to them because some people say: ‘Do not get them from under the carpet. Let sleeping dogs lie. They concern only members of Parliament. They are expendable.’ Members of Parliament are open to criticism. One can make headlines at the drop of a hat if one talks about improving the position of members of Parliament.
It is possibly a good thing that this matter is being referred to the Tribunal. On the other hand when 3 1 March comes along many of the new senators will look aghast at the selfless people who are going to say that it is the wrong time or it is too much. I remember an incident that occurred when the Labor Caucus was discussing increasing the salary of members of Parliament from £1,000 a year to £1,500. One man stood up and moved an amendment that the new figure be £1,250. He said that it was unethical to take any more than that. The former Speaker, dear old Sol Rosevear, stood and said: ‘You are the first person I have ever seen who could split his ethics’. He wanted to split the difference between £1,000 and £1,500 a year. Those sorts of things go on when the privileges and entitlements of members of Parliament are discussed.
I want to put in a good word for all members of Parliament. Most of them work hard. The work that nearly all of them do is beyond expectations and the limits of their duties. They do a lot extra. I believe that such matters as their salaries, expenses and so on should be the last consideration of members of Parliament and is the last consideration of most members of Parliament. But I also believe that they should be at least placed on a level with any other executive in the community.
– This statement is worthy of some debate. I would like to voice a protest at the fact that it has been made in such a way and at such a time as do not permit a full debate. I do not accept the principle of the proposition put forward that it is to protect the integrity of members of Parliament. I do not think the integrity of members of Parliament has been affected by decisions made in the past as far as their remuneration and allowances or the facilities provided to them are concerned. I do not want to be hard on the Minister for Administrative Services (Senator Withers), but I believe that he is merely moving his responsibilities onto a tribunal. He should have been prepared to accept the responsibility that the previous Minister accepted and made those decisions, which I believe to have been just decisions.
The Minister for Administrative Services is best able to assess the needs of parliamentarians. What we are doing here by this procedure is moving the responsibility onto a tribunal which I believe at this moment- it may be different in the future- is not properly equipped to assess the needs and entitlements of members of Parliament across the whole range of this statement. It is perhaps equipped as far as salaries, remunerations and actual office allowances are concerned, but I do not think that the Remuneration Tribunal is in a position to deal with the whole range of minor details in this statement nor do I think that it should be expected to accept the responsibility for doing so. There has been what I would term a little duck shoving. The reason why there is a need for more consideration of the statement possibly arises out of what Senator Douglas McClelland said, that is, that when the report of the Tribunal is brought down- and it will be a somewhat complex report covering a wide range of decisions- we can move only for a disallowance of the whole of it.
– It can bring down 20 different determinations.
-Let us see whether the Tribunal does or does not do so. If that is the case, of course, we are then completely at the mercy of the Tribunal. If I might say so, the Minister has put the members of this Parliament and the Parliament at the mercy not of himself but of the person who heads the Tribunal. I do not think that is a wise move to have made. I believe, and I have always believed, that the Parliament should make its own determinations and the members of Parliament should arrive at their own conclusions. From the taxpayers’ point of view that possibly will result in an underassessment rather than an over-assessment of the entitlements. That has always been my view, even though I go along with having a Tribunal to take the actual salaries out of the area of political debate. But the wide ranging conditions referred to in this statement are conditions that should be subject to the decision of the Minister, having sought the advice of his colleagues in the Ministry and his colleagues in the Parliament. I think it is a convenient way to escape accepting responsibility to pass this matter on to the Tribunal, which is not properly equipped.
If I may say so, the last report showed that the Tribunal did not properly understand the responsibility or duties of members of Parliament or senators. It did not properly understand the function of the committees in this place, lt did not properly understand the workings of a parliamentary office. We are now being asked to make submissions individually or to delegate one or two people to make submissions to the Tribunal. To me there is something wrong with that. My view is that this statement ought not to have been suddenly made in this place. I think the statement should have been allowed to have the consideration of all the Parties in this place in the Party rooms and that an opportunity should have been provided for considerable debate on it. I trust that the Minister will take into account what I have said about disallowance. Perhaps we ought to be looking at the Remuneration Tribunal Act to make certain, if this is to be the decision, that there is some flexibility on the part of senators and members of Parliament to amend, alter or make exclusions from the Tribunal’s report without disallowing the whole of it.
– I thank honourable senators for the contributions they have made to this debate. I shall take on board most of the suggestions that have been made, particularly Senator Douglas McClelland ‘s suggestion that we let former members of the Parliament who have some entitlements have a copy of the statement. I shall see whether they can be given not a copy of the statement but the Hansard report of what both he and I have said. We can possibly arrange that tomorrow.
I wish to respond, if I may work backwards, firstly to Senator Georges. We did not introduce the Remuneration Tribunal Bill into this Parliament. If honourable senators like to read my speech on it at the time they will see that I said that whilst the Opposition would not oppose it I had never thought that it was necessarily the right way of going about the matter. I said that because I always believed that I was elected to this chamber to make decisions and not to hide behind outside bodies. But that was the will of the Government and the will of the Parliament and I went along with it. I wished the Government the best of luck, but I said that it would run into as, much trouble with the Remuneration Tribunal as was run into with respect to the Kerr Committee, the Richardson Committee, the Nicholas Committee and every other committee that has dealt with the salaries and allowances of members of Parliament. I think I was rather prophetic. I suppose the Australian Labor Party still has a facilities committee. If Senator Georges or the facilities committee has any suggestions to make as to how the Act ought to be amended I shall certainly take them into consideration.
As to the reason why I asked the Remuneration Tribunal to report so speedly, I particularly wanted it to report by the end of” this month on the overseas travel entitlements of members of Parliament. I do not know what the Remuneration Tribunal will do. But should it make a determination in this area I think honourable senators ought to know the result by the end of this month. The winter recess will commence a couple of months later. It is not easy to plan to go overseas if a determination is due late in May. That is why that early presentation date for the determination has been inserted. I cannot enforce its presentation by that date; the Tribunal is master of its own house. But this is one area in which I would like and have asked for particular attention for the sake of honourable senators.
Senator O ‘Byrne and Senator Wood referred to the fact that we have reverted from first class air travel to economy air travel. I suppose that as Leader of the Opposition and now as a Minister of the Crown I have sat more often and longer in aircraft than any other honourable senator. Quite frankly, I have never complained about it and I have become accustomed to economy air travel. The only trouble is when I travel on a Monday holiday and I am served with sandwiches prepared on the Friday instead of on the Sunday. That is one of the problems. The sandwiches are a little older. One should consider the difference between the economy and the first class air fares for that few extra inches in the seating accommodation. We are all too wide, anyway. Also, I do not know what the ‘forty’ relates to in relation to the meals on aircraft. Perhaps it is a 40-year-old meal which one airline is advertising that it serves. I wonder whether it is worth the difference in cost. We hear all this talk about missing meals and the length of time spent travelling. I have not noticed any diminution in the waistlines of honourable senators, any haggardness or anything else. In fact, far from my weight being stationary; I think it is increasing.
– What about Chaney?
-It would not be possible to fatten Senator Chaney, anyhow. This is a prime example of how members of Parliament woke up one morning to find that a class of travel to which they had been entitled, I think since 1901, had been removed. The entitlement went back that far to railway travel. It automatically flowed into air travel. But it just disappeared. I think that was terribly wrong.
I know that Mr Daly did a lot for members of Parliament. But one of the things to which I always objected, not only when Mr Daly was the Minister for Administrative Services but also even when we were in government, was the fact that the entitlements list of members of Parliament was headed ‘restricted’. Do honourable senators remember that? It was always headed restricted’, as if the media and the public were not to know what we got, as if we should be ashamed of it. Why should the members of the public not know what they pay their servants? Why should we not be open about it? I always felt that that was wrong. Then again, we had some problems in the Senate with the former Government after the presentation of the Budget last year. Honourable senators will recall what happened. I have seen letters which my predecessor, Mr Daly, wrote to certain people and in which he said, in effect, ‘Due to the unprincipled attitude of the Opposition, etc., I am chopping off your privileges’. I have a file on this matter. That is what was happening. Lest anybody wants to talk too much in praise of what Mr Daly did, I could produce in the Senate some of the files which show how he fixed himself up with a free telephone and motor car transport for life. He hid that away. That information was never tabled in the Parliament. These things ought not to be done. In future I hope that the Tribunal will decide these matters. For good or ill the Parliament passed the Remuneration Tribunal Bill. It gave the Tribunal all the powers, many of which it has never exercised. It does not have to operate only on a reference from a Minister. It can always operate on the reference or the submission of any member of the Parliament. It can initiate its own inquiries. Parliament gave it those powers. Parliament, having given it all those powers, has to put up with the determinations. Provided Parliament is prepared to abide by the umpire’s decision, I have the feeling in my bones- I put it no higher than that- that the members of this place will do better out of the Tribunal in the long term than they would ever do out of their own colleagues.
Question resolved in the affirmative.
– I listened with some interest to the remarks of both Senator Wriedt and Senator Grimes on this matter. The Opposition does not oppose the Bill. Indeed, it supports it because it is identical to one which it introduced when it was in government. There are one or two comments I would make. It is important to remember that the Bill being debated forms part of the Loan Council program and its State by State sharing can be changed only by the unanimous agreement of the States. When we pay regard to this general problem of tax sharing under the proposed new federalism policies, there are one or two things that might be said also. The recent Premiers Conference dealt with this matter. It outlined an equalisation scheme which protected fully the position of the less populous States. I am informed that at the Premiers Conference no State present made any substantial or fundamental objection to the proposals. Perhaps honourable senators might also like to know that the Commonwealth and State officers are meeting early next month to pursue the technical aspects of this general proposal of tax sharing. It would seem, therefore, that the investigation is proceeding fairly well. People may have different views, but no doubt the situation will be clarified at this officers’ meeting and at later meetings of the Premiers.
Specific purpose payments to the States are being looked at by the Bland Committee with a view to trying to reduce unnecessary Commonwealth supervision and unnecessary duplication with a view to make money go further. The States have been invited to give their views on these wider issues to the Commonwealth. I do not think there is need to say a great deal more. We have one or two other Bills to get through this afternoon which honourable senators may wish to speak upon. Therefore, I shall not take up the time of the Senate any further, except to thank honourable senators for their contributions and for passing the Bill without objection.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Debate resumed from 3 March on motion by Senator Cotton:
That the Bill be now read a second time.
– I do not propose to speak at great length on the Air Navigation (Charges) Bill. However, there are a few observations I want to make. Firstly, the purpose of the Bill is to amend the Air Navigation (Charges) Act 1952-74 by inserting in the principal Act a table of charges set out in clause 4 of the Bill. Its main effect will be to increase air navigation charges by 1 5 per cent retrospective to 1 December 1975. Minor aspects of the Bill relate to the deletion of provisions in respect to flights to and from Papua New Guinea which are now covered by provisions applicable to other international flights.
The Opposition does not oppose the Bill, but we are taking this opportunity to make a number of observations. It will be noted that in the second reading speech of the Minister for Industry and Commerce (Senator Cotton) it is stated:
Under the previous Government’s Budget proposals the aviation industry would have had to find another $25m and under this proposal it has to find about $3.9m. The Government has been concerned to encourage general aviation in particular and not to price it out of the air. Over the past 3 years, because of the previous Government administration’s approach to cost recovery, combined with inflation, general aviation ran into serious financial difficulties. This can be seen as a measure of our determination to encourage that important sector of aviation.
There is a great tendency for Government senators to blame everything on the Labor Government when they bring new Bills into this chamber. They seem to look back over the last 3 years and say: ‘If those 3 years had not occurred we would not be bringing in these Bills’. The story of how they try to turn on the lights but have great difficulty finding the switch is becoming almost like a broken record. They said very early in the piece that they would restore the purchasing power to the Australian dollar; in other words, they would reduce inflation, bring prosperity back and reduce unemployment. None of these things is happening. In fact the situation is growing worse day by day. It is almost 100 days since my Government was removed from office, and the country has become worse and worse in general attitudes.
The Labor Party initiated this measure and said that there ought to be a cost recovery plan in respect of services provided for the aviation industry, whether they be by way of landing facilities at the various airports, search and rescue operations, or whatever the case may be. During the campaign Liberal Party members went to very great pains to say that they would defer this measure if they were elected to government. I think it was on 6 February this year that the Minister for Transport (Mr Nixon) said that the Government was not going to go ahead with the deferral. So, in fact, the Government repudiated its own policy. I am getting very confused by the general attitude of the Government. Not only did it repudiate its policy with this 1 5 per cent increase, but it did so without actually coming to the Parliament. It did many things before the Parliament actually sat. Of course, this is not unusual. In the Australian Capital Territory great restrictions have been placed on the employment of people in the Public Service. There has been a cutting down of transport services. It does not matter if the cuts affect youngsters going to school. There is this great saving complex. One would have thought that Government supporters had never heard of deficit budgeting. We should compare Australia with America. America can produce a bigger deficit in a couple of weeks than this country can produce in a year.
I do not disagree with those who say that we ought to be reducing inflation; but I do not think that the Government should make the poor of the community suffer so that the wealthy may prosper, and that is precisely what this Government is doing. For the last 3 weeks the Minister for Education (Senator Carrick), who is a member of this chamber, has been blaming everything that is happening in the field of education on the Labor Government, while he takes away from the primary schools and the retarded children in this community the sums of money that they so badly need. There is a repetition of this from one department to another. The Minister for Environment, Housing and Community Development (Senator Greenwood), who is also a member of this chamber, is not uttering one word of opposition to the Minister in another place who is selling the minerals of this country wholesale in the nearest auction room and wrecking the environment in the process. A number of people are getting all of the profits and the people who can least afford it are being made to pay. I hope that because of the attitude the Government has adopted in regard to this Bill there will not be a paring down in safety measures at various airports throughout Australia. I hope that there will not be a relaxation of safety standards. History shows that the Liberal Party introduced this measure in the first place nearly 16 years ago; but it was never implemented because one man, the famous or infamous Sir Reginald Ansett, virtually runs the airline industry of Australia. He is able to exert very great pressure on this Government, as he was able to do in respect of all other Liberal governments.
With those few comments, I reiterate that the Opposition does not oppose the Bill. I think that some things ought to be taken into consideration by the Government and that it ought to recognise that it cannot make the poor of this community suffer in the areas I have mentioned in speaking to the Bill and that the wealthy section of this country- the 15 per cent who do not have to work for a living- should not be made wealthier at the expense of the rest of the community.
-I welcome the opportunity to make a few comments on this piece of legislation. I am mindful of the fact that I should keep my remarks as brief as possible because we have a certain timetable with which to conform before the day’s business is fully discharged. But this is an opportunity to refer to the special position of Tasmania in relation to transport, travel and things of that kind. I am sure it is recognised throughout this chamber that Tasmania’s position is a special one and that the position in Tasmania in regard to passenger services and passenger travel is similar to the position which applies in regard to freight services over which there has been so much heartburning over the past several years. 1 suppose that if one were to go back in history one would see that this has been a feature of Tasmania’s economic life from the inception.
It is necessary to understand just what is involved in this legislation. I can state it very briefly. It is consistent with what has happened in past years. The Government is updating the level of charges levied on the airline systems of Australia. I think it ought to be noted at this stage that the proposal now before the Senate for a 15 per cent increase in landing charges means a shift of only one-half of one per cent in aircraft operating costs in this country. Also, to put it again in its total context, the proportion of costs of operation of air services in Australia affected by air transport charges is now only 3 per cent. I do not think anybody can properly level at the Government- this Government or preceding governments- a charge that the level of charges is too high, in view of the figures I have just quoted. I think it also ought to be borne in mind that the community at large is still bearing something more than 40 per cent of the total cost of the provision of air service facilities throughout Australia. The situation so far as Tasmania is concerned is that 87 per cent of interstate passenger traffic is carried on the airlines. It ought to be remembered that the balance is carried by shipping and that is diminishing; so we can expect that a higher and higher proportion of interstate travel by Tasmanian people will be by air.
Recently the Launceston Chamber of Commerce and other organisations in Tasmania involved in this area of the economic and social life of the State have been very concerned at the quite substantial increase in air fares in recent times. They have made protests, quite wide and loud protests, as yet without any result. They have, I believe, in recent times addressed a letter to the Minister for Transport, Mr Nixon, pointing out the damage which is being done to the economy of Tasmania and to the social and economic life generally of Tasmania as a consequence of these sorts of charges- freight charges and other charges which are applicable to our interstate communication systems. This, of course, will have a very bad impact on the tourist industry in Tasmania. I think it is recognised that in the past several years Tasmania has been trying valiantly to build up a viable tourist industry. There is no doubt that it has a tremendous potential in this area. There is no doubt that Tasmanian governments- the present one and previous ones- are to be commended for the energy, effort and initiative they have shown in trying to promote the tourist industry. Financially, it is a very valuable industry to Tasmania. Every State, I suppose, takes advantage of its own naturally occurring potential for development and endeavours to make itself as financially strong and viable as is possible. If in Tasmania there is any one thing at which we could work to improve our financial situation, it is tourism. Every time there is an increase in the interstate charges for passenger services or for freight it has a damaging effect on the economy of Tasmania. Certainly any diminution of interest in interstate travel to Tasmania has a very serious impact on the tourist industry and therefore on the financial position of the State.
We have seen in recent years the removal of some areas of manufacturing industry from Tasmania to Victoria and other parts of the mainland. We have lamented and very much regretted that. It is to be deplored and the Government of Tasmania is trying very hard to reverse the trend and to ensure that there is minimum interference with the availability of travel facilities interstate. There has been a substantial growth in the tourist industry in Tasmania during the past several years. The second sentence in paragraph 5 of the second reading speech says:
However, the Government intends to examine carefully the whole question of cost recovery in respect of air transport facilities . . .
In that context I suggest to the Government that in any investigation of this matter the damaging effect to Tasmania of a diminished tourist industry should be taken into account. In other words, if there is some way in which passenger services to Tasmania can be assisted and if air fares are not increased or are kept at a reasonable level, the demands that Tasmania would make on Federal finances to make it viable would be lessened. It would be far better to see an activity such as the tourist industry fostered and sponsored in Tasmania from the resources of that State than to have a downturn in the economic situation as a consequence of the damage caused by increased air fares and the State having to go elsewhere for more funds to keep it going. I suggest that the first state of affairs would be far healthier.
The continual increases in passenger fares are having a very serious effect on the tourist industry. The Launceston Chamber of Commerce, in a letter I have not yet seen but which was addressed to me at my Devonport office, observed that it would anticipate a downturn in tourism as a result of the recent savage increase in air charges. The tourist industry that has developed over the past several years has meant a substantially increased number of aircraft flights to Tasmania. One frequently reads of charter flights being organised by the airlines and by other travel agencies throughout Australia. With the impact of the increased fares it is anticipated that there will be a downturn. If the patronage in this area drops there will be fewer flights to Tasmania and the system of communications between that State and the mainland States will drop away.
Tasmania is unique in that we are limited in the availability of travel to us. That situation also applies to freight. I understand that the Nimmo report is about to be brought down in the Parliament. That applies to the freight side of the matter. I think it would be appropriate, because of its financial and economic importance to Tasmania, if an evaluation were made of the damage resulting from ever increasing passenger air fares to Tasmania, just as an evaluation has been undertaken with regard to the freight situation. Because it is necessary to keep Tasmania on a reasonable basis of competition with the other States, I think it would be proper to see whether some system could be devolved or developed whereby the disability of Tasmania could be overcome. On the mainland it is possible to travel interstate by rail or road but one cannot do that in Tasmania. I have told the Senate that the availability of berths on the ships plying between Tasmania and the mainland has diminished because of the reduction in shipping services of that nature and we are becoming more and more reliant on air services. While fares continue to rise people are dissuaded from travelling interstate and I think that is totally bad. Fares have increased 27 per cent in recent times. The last increase meant that the return fare from Launceston to Melbourne, instead of being $52.20, went up to $66.40. One can see the sort of impact that has on travel between Tasmania and the other States.
There is also the matter of the cost recovery level. I am not criticising the Government on this. I think it is a proper measure. In fact it was a fundamental part of the policy of the Labor Party to ensure that eventually we recover substantially the cost of the various air services throughout Australia. I think it is appropriate that that be done, but I think one also ought to take into account that there has been minimal expenditure by the Department of Transport in regard to the maintenance and servicing of the airports at outlying places such as Devonport and Wynyard. Passenger traffic there has increased during the last several years. One would imagine that the people operating those services have done very well out of that. There can be no complaint that there has been over-expenditure on outlying airports. At the same time I suggest that there has been a quite substantial return to the operators and they have no basis for complaint.
At present the charge is indiscriminate; it applies right across the board. I think it would be appropriate to have a look at a system whereby we could alleviate the problems in some areas and perhaps the load could be spread more equitably and reasonably over those airports where there is a great amount of traffic and greater financial viability. There is an obligation on us in the Federal sphere to ensure a minimum of isolation for the outlying centres of Australia, and I mention the very special position of Tasmania in that respect.
Now that we have taken such an interest in putting Tasmania on a reasonable basis with regard to freight charges, I think it would be timely to have a look at the situation in regard to passenger air fares between Tasmania and the other parts of the continent. Unless we do something like that and unless the expectations of people such as the chambers of commerce are realised we in Tasmania are in for a serious time. I think it would be appropriate if the Government were to look at this situation and were to provide a level of assistance to the developing tourist industry in Tasmania because of the efforts being made by the Government of Tasmania to promote that industry and to make that State financially viable without having to beg somewhere for finance to bridge the gap in its monetary returns. I strongly urge the Minister to give serious consideration to that proposition. In any event the frequent increases in these charges are to be lamented. I do not see any relevance between the 27 per cent recent increase and the one-half of one per cent increase in operating costs represented by the Government’s 15 per cent increase in navigation charges embodied in this Bill. The whole matter needs to be looked at very closely and keenly in the hope that the special position of Tasmania can be appreciated and understood and something done to alleviate it.
– I wish to make a few brief points concerning the general aviation industry and the way in which it has been affected through the Labor Government’s imposition of the cost recovery program since 1973. We know that this country demands a general aviation industry that is well organised, that is set up properly with new equipment and that is, in fact, able to operate smoothly. There are many reasons for that. We have only to think of the problems that we have as regards defence to realise the benefits of having trained pilots available to take part in any war that may break out. We know also that because of the vastness of the Australian continent we need to have people trained and skilled in flying in all sorts of conditions in order to carry out properly an effective transport system throughout the country. Senator Devitt mentioned this earlier.
It must be a help to decentralisation if we can provide this sort of service. Again, we know that we are prone to disasters from time to time and we can therefore consider the value of the general aviation industry in assisting the welfare of the victims of floods, earthquakes and, of course, cyclones. I compliment the Minister for Transport (Mr Nixon) in particular for the way he intends to have carried out a thorough examination of the cost recovery procedures as they will operate in respect of general aviation. I know that this has been particularly well received in the industry. I hope that it will be carried out with all expedition and that we will be able to get answers and settle on a proper approach to the problem of cost recovery. We know, of course, that the cost recovery program established in 1973 was brought in in a hamhanded manner, in such a way as to pay no regard to the factors I mentioned earlier. We know that it was totally inequitable to apply an across-the-board system of charging general aviation the same sorts of costs as were applied to commercial aviation.
In a country of our size all sorts of equipment and airport controls are available at airports. These are designed specifically for jet aircraft, special commercial aircraft and aircraft of that sort. They do not have any application in the general aviation area but the previous Labor Government applied a cost system which affected general aviation. That resulted from a lack of communication between that Government and the aviation industry. Although Senator Keeffe said that we were cutting down on safety measures, I see it the other way round. In implementing a proper cost recovery program that is assessed on an equitable basis as it applies to the commercial industry and general aviation we will get more effectiveness from safety measures.
– Are you going to. improve them by 15 percent?
– I think the honourable senator has missed the point. It is a matter of how one recovers costs. We are talking about the cost recovery side of aviation rather than the cutting down of safety measures. I congratulate the Government on its stand, a stand which will allow an increase at present of only 1 5 per cent which can only be regarded as in line with inflation and which will be generally accepted in the industry.
– in reply- I thought there may have been one or two other speakers; it was indicated to me that there would be but as there are not I shall reply now. Senator Keeffe said that the Bill was not opposed. No senator who has spoken has indicated any opposition to it. I thank the honourable, senator for that intimation. Senator Keeffe said that in the second reading speech the previous Government was blamed for everything. That, of course, is not the case. What is the case is that the previous Government stands in a pretty bad light with its record. That is revealed in most things that one must look at. He said also that Labor initiated a cost recovery plan. That is not a fact. That plan was initiated by a previous Government about ten or twelve years ago.
– In 1960, and you did not do anything about implementing it.
-That is incorrect. There was a yearly impost. I was responsible for some of them, and the honourable senator knows that to be a fact. What the Labor Government did was to increase substantially the recovery rate. The Labor Government escalated it heavily. The honourable senator did not really deal with the subject matter of the Bill, so I will not take too much time to reply to his comments. However, he adverted to safety measures, a matter of general concern to the whole Australian community. I would hope that no Department of Transport, no civil aviation authority or similar authority would allow safety control measures to be abated. That would be disastrous. We should all support, as a bipartisan measure, any attempt to improve safety, to make it better and to bring it under better control. Australia, as is well known, has a good record of air safety. That record should be supported and maintained.
Senator Devitt spoke about Tasmania and the particular effect on the economic life of that Island of the air transport system. I agree with his contention. I was interested in his contention that 87 per cent of the travel from the mainland to Tasmania is by air transport. That figure is higher than I would have thought, so the situation must have changed in the last few years. He also mentioned goods transport. He should bear in mind- perhaps his colleagues might also- that during the term of the Labor Government air fares increased between 10 per cent and 20 per cent per annum. My recollection is that the overall increase was about 60 per cent in the time of the Labor Government. The problem we now have was initiated largely by the actions of that Labor Government.
– But not on the basis of these charges, surely.
-During the term of the Labor Government air fares increased by 57 per cent in 3 years. I suggest that the honourable senator compare that with prior air fare increases. I agree with Senator Devitt- if he will allow me to do so in a moment of silence, which is not normal- that the tourist industry in Tasmania has a substantial potential. This aspect interests me greatly because in another part of my work I am involved in the tourist and travel industry. I have long believed in the attractions of Tasmania. I also believe that we need to look at the tourist industry as a travel industry to see whether we cannot improve the overall volume of travel movement within Australia by Australians. That is a better way of generating tourist income than the heavy generation of international flying which on available figures- I do not have them with me- does not produce a net Australian gain. We tend to have more people going out of Australia and spending money than coming in and spending money.
Tasmania, to my mind, is a very attractive island. It has a great capacity. I should like to see generated more domestic travel to Tasmania by Australian travellers. I hope we can do something about that aspect. I know the problems of manufacturing industry loss. It is, to some extent, a problem of communication cost. It is also a problem of raw material transfer cost. The air transport system has some bearing on this situation, although not a total bearing.
Senator Devitt and Senator Messner referred to the examination of cost recovery in the airline system. The Minister is taking up this matter. It is good that he should. I shall be glad to take to the Minister the contributions and suggestions of Senator Devitt. The Minister may recommend that the group undertaking the cost recovery study consider those suggestions. I am also grateful to Senator Messner for his comments on general aviation. I agree with him. He said that for future defence needs this field was a good training ground for persons who learn to fly in aero clubs and similar organisations. I think there are many members of the Parliament whose early flying experience, which led them into the Royal Australian Air Force, was gained in aero clubs and like organisations. There is something to be said for the view that it is a potential training ground for skilled people and therefore should not be discouraged as it was discouraged massively.
This is an arm of decentralisation. Australia, geographically, lends itself to air transport and we should be encouraging air transport in various levels of activity. The general aviation field, the third airline system and the principal domestic carriers should all be encouraged because Australia lends itself to being a good air transport country. I do not know the relevant figures today but at one time when I was looking at this aspect Australia stood fifth in the world as an air transport country because of its domestic travel component and its international flying component. Australia was a major civil aviation power. That was one reason that I thought it a great mistake to take civil aviation into the field of general transport rather than leaving it by itself as it was.
I refer again to the escalation of air navigation charges, about which we are now talking. It will be found from the annual report of the Department that the total amount collected in 1 972-73 was about $27m and in 1974-75 it was $44,871,000. So there was without any doubt a very heavy increase in charges in those 3 years. It had the significant effect of increasing fares and depressing activity in the industry. It is now being brought back into balance. The whole matter is being examined. I think it is a very worthwhile exercise, and I thank the Senator for agreeing to pass the Bill.
Question resolved in the affirmative.
Bill read a second time.
– I beg leave to address the Committee for only one minute. The matter which I wish to raise was raised before in this debate, I think, by Senator Devitt. It concerns the reliance upon air transport, particularly of passengers travelling to and from Tasmania. At present more than 90 per cent of persons travelling to and from Tasmania travel, in fact, by air. Rather than deal with the problems associated with travelling to and from Tasmania while we are discussing this Bill, I simply foreshadow that at a future time after the report of the Nimmo inquiry into transport to and from Tasmania has been presented, I will again be raising this matter in this chamber.
I believe that the overall application of air navigation charges is discriminatory to the State of Tasmania and to other areas of decentralised population. On behalf of the Tasmanian Trades and Labour Council, I gave evidence about this very subject before the Nimmo inquiry in Tasmania, not quite 2 years ago. I tabled documents which showed that the air mile rate between Melbourne and Tasmanian ports was far greater than the air mile rate between the main trunk routes travelled by the airlines. Rather than preempt what might be contained in the Nimmo inquiry report, I will leave any further contribution that I might have to make on this matter until such time as that report is brought down.
Bill agreed to.
Bill reported without amendment; report adopted.
Bill (on motion by Senator Cotton) read a third time.
- Mr Deputy President, I ask for leave to make a statement on the economic situation.
The DEPUTY PRESIDENT (Senator DrakeBrockman) Is leave granted? There being no objection, leave is granted.
– I had arranged to provide this information for the Leader of the Opposition in the Senate, Senator Wriedt. In discussion with him he agreed that perhaps it would save everybody’s time if the statement were incorporated in Hansard. I therefore seek leave to incorporate in Hansard the statement which is being circulated. It has been delivered in the other place by the Treasurer, Mr Lynch.
The DEPUTY PRESIDENT-Is leave granted to incorporate Senator Cotton’s statement in Hansard! There being no objection, leave is granted. (The document read as follows)-
This Government has been elected to office at a time when the Australian economy is experiencing the results of its most serious setback in the post war period. Indeed, it is largely as a consequence of this economic reversal that our opponents, and their economic policies, were so overwhelmingly repudiated by the Australian electorate in December- after just 3 years in office. The Government has a clear mandate during its term of office to restore economic stability and prosperity.
The overriding importance which the Government attaches to its economic program is reflected by its decision to bring down a major economic statement during the early stage of the first parliamentary session. Unlike our predecessors, we intend to use the Parliament as a forum for economic debate and as the avenue for putting our economic program before the people. If there is one single element which is fundamental to all that I shall have to say today, it is the absolute necessity of combating inflation. As a result of the economic vandalism of the past 3 years, inflation now threatens not only the future working of our economy but the very structure of our society. Not only inflation, but unemployment also, are at record levels. The private sector has not yet emerged from its state of deep shock. Even so, as the policies we have adopted have their effect, there is now the prospect of some recovery in 1976. But any sustained recovery will depend on our progress, as a community, in curbing inflation. A recovery which took place with inflation poised to take off again from its present double digit rate would inevitably be short-lived. It is this harsh underlying reality which has closed off the ‘easy option’ and which dictates a policy mix dominated by a long view rather than a short one.
The Government is now steering a new and positive course- one which will be long and difficult. We are determined to pursue that course even though doing so will not be painless. It will require a measure of restraint and sacrifice by every Australian- by the Government as well as the people. It will require an acceptance of the fact that our nation’s resources are limited and that not all competing claims for an increasing share of those resources can be met now or in the period immediately ahead; insofar as the Government is concerned, the assistance it provides will have to be strictly tailored by economic constraint and judged rigorously on the principle of need. But, as the great majority of Australians is well aware, there is no longer any alternative if our economy and society are to be hauled back from the brink. I do not intend to go over the economic events of the past in detail but I offer the Senate a brief reminder of why this once lucky country’ must now face its most critical economic test for over a generation. In 1974-75 Commonwealth Government spending increased by a colossal 46 per cent. Despite all the talk about applying tourniquets, that budgetary haemorrhage was continued in the 1975-76
Budget. Consequently, planned outlays this year were well over twice those budgeted for in our last Budget in 1972-73. The results of this abandonment of all sense of budgetary responsibility led, in the ultimate, to a drying up of demand in the private sector and a quite devastating loss of confidence.
Consumer spending fell away. Business investment slumped. Production fell. Job opportunities vanished and unemployment soared. The Labor Government’s reaction to those trends as they developed was more of the same old alleged remedies’- more government spending, bigger deficits, more credit creation. After the mid- 1974 credit squeeze, the liquidity tap was turned on hard and left running. The money supply soared by about 20 per cent in 1975- and this in a year of” stagnation. Clearly, these policies just did not work.
The consumer price index in 1975 rose by 14 per cent. Inflationary expectations, deliberately inflamed by our predecessors’ permissive attitude towards wage increases, were firmly entrenched by late 1 975. That then, in brief, is the situation: If the facts were not beyond dispute it would be unbelievable that the Australian economy could have been brought to such a state in 3 years. We can, however, learn some important lessons from Labor’s record of mismanagement.
In the 23 years prior to 1973 successive Liberal-Country Party governments consistently steered the Australian economy along with a record, so far as inflation and unemployment are concerned, better than nearly all other economies. Australia’s relative deterioration in terms of those world comparisons came only with the advent of Labor. Stagflation in Australia did coincide with similar experiences overseas. But the relative deterioration of our own position can only be explained by domestic policy errors. This has been made clear time and again in the reports and statements of authoritative and respected world economic organisations such as the International Monetary Fund.
Two developments that contributed to our present economic situation were the explosions in wage increases and government spending. Excessive wage increases, actively encouraged by a permissive and pace-setting government, fuelled inflationary expectations and reduced employment opportunities. The rapid increase in government spending resulted in a huge increase in the Budget deficit and, concurrently, a quite unacceptable acceleration in the volume of money; the explosive growth in federal outlays also led to a massive transfer of resources away from the private sector with consequent severe inflationary effects. These linkages- between wage increases, excessive government spending and inflation on the one hand, and inflation and unemployment on the other- underlie Labor’s failure in economic management. The same linkages are fundamental to the design of policies that are to have any chance of restoring economic growth and job opportunities.
Most important is the set of links between inflation and unemployment- the reasons why high and accelerating inflation intensified and prolonged the recession. In the wake of a period of excess demand pressures, strongly rising prices and the build-up of strongly inflationary expectations, a number of very large wage increases occurred during 1974. Not only were claims made for successively higher amounts but awards were re-negotiated more frequently. As a consequence, 1974-75 saw an acceleration in wage and, to a lesser extent, price increases, even though aggregate output declined sharply and the unemployment rate climbed to 5 per cent. As a result of the uncertainty thus created in respect of future prices and incomes, consumers stepped up their savings- the ‘squirrelling’ phenomenon. The savings ratio climbed from its long-term average in Australia of about 10 per cent to some 1 7 per cent over the last couple of years.
With inflation and unemployment running at their recent heights, households have reacted by seeking higher liquid balances to protect future spending power and to provide a hedge against the threat of future unemployment which past policies made every day more likely. In the business sector, the tide of rising costs- particularly, though not only wage costs- had its immediate impact in a severe erosion of profits. The ability of companies to recover steeply rising costs was hampered both by the activities of the Prices Justification Tribunal and by the policy-induced flood of imports. Within the first 3 quarters of 1974 company profit shares fell by almost a third from their historical level of around 1 5 per cent of gross domestic product to 10 per cent.
During the same period the share of wages, salaries and supplements in the gross domestic product rose from 6 1 per cent to 68 per cent. This squeeze on profits did more than just alter relative shares of the national income. In 1974-75 company incomes, as recorded in a conventional accounting manner, fell in absolute terms by 7 per cent while wages, salaries and supplements increased by 28 per cent. These trends forced businessmen to reassess the expected future profitability of their enterprises- the key ingredient. in decisions to undertake investment projects. As well as this tangible influence, there were also well justified fears about the attitude of the then Government to business and the private sector generally- fears to which one action after another gave continuing credence. As well as reducing expected returns on investment, the onset of rising inflation and inflationary expectations increased the range of uncertainty surrounding all investment decisions. Longer-term projects became particularly vulnerable- it is impossible to plan if costs might double in 3 or 4 years and the prospects of recovering them are uncertain. These factors- a reduction in expected returns from investment and their increased riskiness and the drying up of internal cash flow- all led to a sharp falling-off in business investment.
These inflationary forces depressing both consumption and investment caused the level of activity to slump sharply: Demand for labour fell away. The squeeze on profits made severe pruning of labour requirements necessary for business survival. With the encouragement of a misguided government, trade unions have been vigorously pursuing a policy of pricing workers out of jobs. In short, the trade union movement and our opponents in the Senate put the drive for ever increasing money incomes ahead of employment and job security. What I have said so far has stressed the connection between inflation and recession. But the broader social consequences of inflation should not be forgotten merely because of their greater familiarity.
Consider what a continuation of even 14 per cent inflation would mean: Prices doubling every 5 years and increasing by around 25 times within a generation; and a wiping-out of the value of savings- over a normal lifetime of 70 years an investment of $100 would fall in value to less than 1 cent. I could go on but the point is obvious- rapid inflation is socially as well as economically destructive. It is a hidden tax to which the unorganised, the aged and the thrifty are particularly vulnerable. We hear a lotthough most people have stopped listeningabout the great strides our opponents claim to have made during their 3 years of office. But where was the compassion for those on fixed incomes who saw the real value of their incomes slashed by the 50 per cent rise in prices between December 1972 and December 1975?
Was it really only the rich whose savings were robbed of value by the government-induced inflation? Or was it, also, the poor and the already disadvantaged members of the society?
The report of the Commission of Inquiry into Poverty gave the answer in explicit terms. It said:
No country with a continuing inflation rate of over 10 per cent has been able to prevent this causing grave hardship to important groups of poor people. ‘
This Government’s overriding philosophical commitment is to lessen public intervention in the private sector and in the lives of people. That commitment goes beyond economics to the very way of life of all Australians. Before turning to the Government’s policies for the period ahead, let me say something about our philosophical approach.
A very basic aim will be to reverse the trend to big government and reduce the extent of bureaucracy - particularly centralised bureaucracy- in Australia. We are working towards an Australia with maximum freedom for individuals to pursue their own goals in ways of their own choosing. The Government will restore the private sector and encourage enterprise. It will consult with those in the community who are affected by its decisions or who can contribute to better informed government. This Government will demonstrate that individual choice is not only compatible with a deep concern by government for the needs of the disadvantaged, but an essential ingredient of it.
The dignity and capacity for self-help of those in need is preserved by a government helping them in ways that least impinge on their independence. Compassion for the less affluent in the community will be shown, not by the rhetoric of our predecessors, but by deeds. This Government is determined to do away with the shameful rip-off which inflation has inflicted upon so many Australians, particularly those in retirement.
I turn now to the Government’s economic policies for the period ahead. Some clear implications for future policy can be drawn from the mistakes of the past 3 years. The recession has been intensified and prolonged and unemployment worsened, by inflation and by the growing feeling in the community at large that, in the absence of resolute government, the only realistic expectation must be that inflation will continue and worsen. In that respect the activities of all those who supported the recent 6.4 per cent national wage increase have served to support and further entrench those expectations and to damage job prospects in the process.
What used to be thought of as conventional pump-priming’ efforts to reduce unemployment have proved ineffective and even counterproductive, essentially because they do not slow inflation. Indeed, the resulting increased deficits heighten inflationary expectations. Policies must therefore focus on ways of ensuring that there are reductions in government spending, a reduction of the deficit and a cut-back in excess liquidity. To some, cutting back on government spending and the deficit seems paradoxical; we hear it argued that that will not contribute to economicrecovery but, on the contrary, depress activity still further.
In today’s world that orthodox ‘keynesianism ‘ is no longer appropriate; on the contrary, it is hopelessly outdated. It is of course characteristic that out-dated orthodoxies of this kind should be most strongly adhered to by political parties which were once wont to describe themselves as radical. That this old orthodoxy has had its day is widely recognised around the world. We ourselves made the point time and time again in Opposition. It is now well-recognised internationally. For example, the United States economic report of the President, January 1976, said :
The events of the past several years have once again convincingly demonstrated that accelerating inflation causes instability and disruptions, increases unemployment, and ultimately precludes real prosperity.
The September 1975 International Monetary Fund survey reflected that view in the following terms:
Any handling of the current problem of international recession that involved a setback on the inflation front would inevitably be short-lived, representing a prelude to further economic instability.
In the United Kingdom, the home of Keynesianism, and under a Labour government, the futility of piling on new deficits in order to reduce the unemployment created by the succession of previous deficits is finally being understood. As the Prime Minister, Mr Wilson, said on 2 February of this year:
It would be a great mistake to act precipitately and reflate now on a massive scale. That is no easy way out of our economic problems. For the result would be yet another inflationary boom, febrile and short-lived, lt would be a clutch of measures creating and reinforcing another move into depression and unemployment.
Later in February a British Government White Paper was issued announcing sharp cuts in future public sector spending. Similar examples could be drawn from Germany, Japan and, more recently, Canada. But the point is made. Piling up ever-increasing deficits in relation to the gross domestic product is simply not a viable policy option.
Countries which have gone down that road for a time are now trying hard to go into reverse.
Even the last Labor Treasurer in Australia belatedly recognised the reality when he said in his Budget Speech last August:
We are no longer operating in that simple Keynesian world in which some reduction in unemployment could, apparently, always be purchased at the cost of some more inflation. Today, it is inflation itself which is the central policy problem. More inflation simply leads to more unemployment.
It is true that, looked at purely in a short-run context, cutting back government expenditures in order to reduce the deficit will depress activity in the government sector and, in some cases, demands upon and activity in the private sector as well. That is a cost that has to be borne if ‘big government’ is to be eradicated and the private sector is to be enabled to start expanding again in response to the spending decisions of private individuals instead of governments.
Over and above that, big budget deficits mean excessively easy monetary conditions. Throughout 1975 the underlying rate of expansion in monetary aggregates in Australia, fuelled by the huge deficit, was in the vicinity of 20 per cent. Our recent actions in both the monetary and fiscal fields have begun to slow the rate of growth of those aggregates. This, of course, is essential. There is no way in which sustained increases of that magnitude can be made consistent with a continued moderation in inflation.
That is why a budget deficit in the order of $4,700m such as this Government inherited, and consequential monetary growth rates of 20 per cent per annum or more continuing through 1976, was a recipe not for recovery, but at best for a pause in the further downward slide to even higher inflation and even higher unemployment as a consequence. The hard fact is that vigorous action to cut back the deficit and rein in the potentially destructive increases in liquidity may produce some temporary costs in terms of a lower overall level of economic activity and resource utilisation than might otherwise prevail in the short-term. But what has to be faced up to is that there is no longer any alternative unless we are prepared to abandon our present form of society. Restoring economic health will be a slow process; as Prime Minister Trudeau said to the Canadian people in December last:
I cannot promise you that the battle will be won in a matter of months. It will take time for a program of national restraint, in company with appropriate fiscal, monetary and other policies, to exert a real impact upon the rate of inflation. It will take time for us to accept self-discipline as normal and expected behaviour, rather than as heroic sacrifice. It will take time for us to learn to reduce our expectations; but we must retain our resolve.
President Ford echoed these sentiments in his 1976 budget message:
This is not a policy of the quick fix; it does not hold out the hollow promise that we can wipe out inflation and unemployment overnight. Instead, it is an honest, realistic policy- a policy that says we can steadily reduce inflation and unemployment if we maintain a prudent, balanced approach.
In essence, the Government sees its task as that of slowly steering the economy back onto the path of a firmly based recover)’. Control of inflation is fundamental to this. Balanced and sustainable recovery also requires creating the conditions for growth in both consumption and investment. The Government places strong emphasis on the desirabilty of an early revival of investment activity.
The economy’s productive capacity depends in part on its capital stock- the stock of plant, equipment, machinery, buildings, etc., built up by investment activity. The several years of subdued investment activity which Australia has experienced have impaired the economy’s productive capacity in that respect. What this means in terms of the period ahead is that the economy will be able to accommodate, without strain, a much smaller expansion of demand than would otherwise have been the case. A recovery which did not encompass an early upturn of business investment would be easily frustrated by the early appearance of supply shortages in a number of sectors. In turn, that would lead to a resurgence of demand inflation and a spill-over into imports.
It may seem paradoxical to be raising the possibility of future supply constraints at this time when there is capacity lying idle. The point is however that increased capacity cannot be brought in overnight. That is why we need to get business investment moving again as soon as possible. Whatever is said about consumption or investment-led recoveries, the key point is that the Australian economy should not wait another year or more for private investment to begin to turn up.
The policy measures we have taken during our short period in office to date reflect the foregoing considerations both of sound economic management and philosophical attitude. We have acted to encourage investment; to cut government spending; and to mop up some of the dangerous excess of liquidity. Those measures and our reasons for them have been fully described at the time of their implementation and I merely sketch them during my remarks today. We have also moved strongly to oppose, before the Conciliation and Arbitration Commission, the passing into money wages of the full 6.4 per cent price increase of the previous 2 quarters. It is obvious that in present circumstances large wage increases strongly depress the incentive to invest and to take on more employees.
Like large deficits, large wage increases are a self-defeating form”’- a for recovery. The Government’s earliest major action was to boost the private sector and, in particular, private investment directly by introducing the 40 per’ cent investment allowance on plant and equipment. The cost to revenue of this broader allowance as recently modified will be some $470m in a full year. A more balanced and rational approach to foreign investment in Australia will also contribute to an improved investment climate; the Treasurer shall shortly present a separate statement to the House.
The Government has undertaken a sweeping although only preliminary review of all Commonwealth programs and priorities which has resulted in savings to date of some $360m this financial year. This review of expenditures is continuing- both via the operations of the Bland committee and in other ways- and will be of fundamental importance in the formulation of the 1976-77 Budget. In parallel with what will be a continuing policy of expenditure restraint, employment in the Commonwealth Public Service is being subjected to stringent control ceilings; as a result, it is presently estimated to fall from June 1975 to June 1976 by more than 3 per cent in contrast with the 2.8 per cent increase planned by the former Government. But expenditure control is a gradual process, if only because, if decisions are to be sensibly taken, the administrative processes involved in ordering priorities and assessing programs are timeconsuming.
The reduction in the deficit which will flow from the process of expenditure control will make a vital contribution in the period ahead toward resolving the problem of excessive liquidity and its inflationary consequences. However, the requirement to control the already excessive level of liquidity was far more pressing at the time we came to office than could be handled by expenditure control measures alone. Accordingly, the Government deemed it necessary to take direct monetary policy action to deal with that problem in the first instance. We have acted decisively to reduce the rate of monetary expansion so that it will be less accommodating to price increases but will, at the same time, be sufficient to permit financial institutions to underwrite recovery within the private sector.
The measures of 22 January were aimed at soaking up part of the excess liquidity in the financial system without sending the economy once again into a tail-spin. Indeed the package was carefully constructed to do this while in some areas actually lowering borrowing costs to businesses and individuals. I want to stress that in circumstances in which the money supply has been growing at 20 per cent per annum; when the budget deficit in the first 7 months of the financial year exceeded $4 billion; and when, largely because of the deficit, the past year has seen an enormous increase in funds flowing into financial institutions, there is no call for alarmist cries of ‘credit squeeze’ simply because the government acts responsibly to soak up some of the surplus liquidity.
It is true- I am glad to say- that over $ 1 billion was subscribed to the recent Commonwealth loan and Series 1 of the new Australian savings bonds. But is it seriously argued that that was excessive, given the magnitudes Of recent additions to liquidity and- seasonal elements aside- the continuing size of the deficit? What we have done is to drain off a sizeable portion of the surplus liquidity into a new security which is now very attractive to hold rather than prematurely cash in. In that way the introduction of the new Australian savings bond- Series 1 -was an outstanding success. Because of the deliberately attractive terms it offered, it not only drew in $759m of subscriptions- virtually all of it from non-bank sources- but is established the new household ‘ security in a way which will stand us in good stead in future.
When we judged that Series 1 had done these jobs we replaced it with a much less attractive series. That also has been successful. The inflow into it has been much diminished but it is still proving a useful source of non-bank funds. Meanwhile, apart from some minor tightening of rates for short-term money, the effect on other market rates of interest has been negligible. The plain fact is that the essence of successful monetary policy in the extremely difficult situation we have inherited is and must be flexibility.
Thus, as a result of our monetary actions, the liquidity of banks and other financial intermediaries has already declined from the very high levels of end- 1975. Notwithstanding this, bank lending is continuing at virtually unchanged levels and we expect to see it go on doing so. While all such estimates must be subject to considerable uncertainty, our present expectation would be that over the 6 months ended June of this year, the volume of money- what is technically called M3- might rise, in seasonally adjusted annual rate terms, in the order of 1 1 per cent to 13 per cent. By comparison with the figures of around 20 per cent prevailing throughout the previous 12 months or so, this will be a notable and welcome development.
But no rational person could describe it as a credit squeeze’. Within that period there will, of course, be some seasonal tightening of liquidity- as is normally the case- between April and the end of the financial year. In turn, that will be succeeded once again by a period of strongly rising liquidity. The Government will, during the short period of seasonally tight liquidity referred to, ensure that the financial system has the capacity to maintain an adequate flow of finance. In other words, the Government will respond to future developments, as it has already displayed its capacity to do, with flexibility. But, in doing so, it will not swerve from its longerterm aim of reducing inflation.
When it is successful in that aim, the Government will also be moving to accomplish another of its longer-term aims- to get interest rates down closer to the pre-Labor administration levels. Even though some interest rates, for instance, those applying to bank overdrafts, have been brought down I want to emphasise again that the general structure of interest rates can only be reduced as inflation is diminished. One important element of our economic program is the commitment to index personal income taxes and provide inflation adjustments in the company tax area. We see both measures as part of the strategy of shifting command over resources away from government and back to individuals and private business.
As promised in the policy speech, these reforms will be commenced in the 1976 Budget on a 3-year phasing-in basis; the extent of such phasing will be governed by a mix of considerations. Inflation adjustments to company tax are an important means of maintaining corporate cash flow in times of inflation while avoiding the need to increase profit margins. Personal tax indexation is clearly a measure which is anti-inflationary in the longer term to the extent that it moderates tax-induced wage demands and constrains excessive spending based on automatic’ growth of government revenues. Clearly, that will be one element in our considerations; another element must be the immediately pressing necessity to get the deficit down because of its adverse effects on liquidity, inflation and inflationary expectations. It should be obvious- as indeed it was even to our predecessorthat formulation of a budget which led to another huge deficit, far from helping to bring inflation under control, would be entirely destructive of that objective.
In saying that we are in no way resiling from our policy speech commitment; in no way allowing ourselves to be hoodwinked by those sinister Treasury officials to whom the uninformedboth in the Press and beyond it- spend so much time in attributing motives and attitudes. These are merely the plain and unvarnished facts with which the Treasurer, and the Government as a whole, have to contend. As I have said earlier, the prospects for renewed growth of the economy and of job opportunities depend crucially on reining in inflation. That is the key to everything else. Hopefully- though less so now in the light of the recent decision in the national wage case- there will be some recovery in demand, production and employment in 1976.
But this will prove weak and short-lived unless there is a continuing and discernible moderation in the rate of wage and price increase during that time. The Government acknowledges that this is a sombre outlook. However, trying to push things along would be counterproductiveunless the recovery is gradual, we shall not succeed in making headway against inflation. Those whose professional business it is to make economic forecasts caution against any dogmatic presentation of prospects; their business is always a chancy one and almost all of them have been particularly caught out by the events of the 1970’s. Such a caution is particularly apposite at present. At this point in time the Australian economy is rather delicately poised; there may very well be only a fine margin between a recovery which firms and strengthens and one which aborts early.
As has been stressed and re-stressed, the future course of inflation and inflationary expectations is the single most important element around which this fine balance presently pivots. Given these qualifications, the immediate outlook is for some growth in demand. Consumption and private dwelling investment, together with inventory changes, seem likely to contribute to that growth- and this is very much to be desired. Government spending, on the other hand, is one component of demand whose growth rate is expected to be low for a time as the excesses of the past are pruned away. On the external side the position is satisfactory.
The underlying current account deficit is of modest proportions viewed in the context of the overall outlook for exports as economic recovery gets under way in our major trading partners, and having in mind the Government’s desire to see overseas capital make a more appropriate contribution to Australia’s development on terms protecting our national interests and identity. Our balance of payments policy more generally will continue to be framed on the basis set out in detail in the statement the Treasurer made, on behalf of the Government, on 4 January last on the Australian dollar. Overall, then, a moderate rise in GDP during 1976 seems likely but whether it carries on into 1977, and if so how strongly, will depend on our success in curbing inflation. Much the same can be said about job opportunities.
The process of mopping up liquidity has been given an outstandingly successful start by the recent set of monetary measures; the Government’s fiscal policies have been working in the same direction. But even if fiscal and monetary policies can be set correctly and maintained, there remains the problem of cost pressures. The Government has not yet determined, in detail, the approach which it will take on future occasions in the wage-fixing arena. It is not my purpose to canvass that matter now. Nevertheless I can say that we are firmly resolved to put an end to the helplessness some in the community have been feeling about this seemingly intractable problem. We have already spoken out, and we shall go on speaking out, for the national interest in this area.
Unlike our predecessors, we do not propose to run away from the criticisms- the empty charges of ‘confrontation’ and the like- which that stance will undoubtedly call forth. The indisputable fact is that the recent 6.4 per cent increase in wages handed down by the Conciliation and Arbitration Commission has been a severe setback to hopes of improvement in the economy- to hopes of a continuing steady reduction in inflation, to hopes of business recovery, above all to hopes for more jobs. Quite apart from this, the full flow-on of price increases has widened further the gap between the wage and the non-wage sectors. The fixed income recipient -especially the aged and the retired- will again be forced to bear a disproportionate burden of the price rises which will flow from the Commission’s ruling.
There is now a very real danger that 1976 may see a further entrenchment of wage-cost pressures as a result of the 6.4 per cent increase. Nothing could be more destructive of employment opportunities. This point tends to be ignored by those who criticised our stand. But it was recognised by a former Treasurer, Mr Crean, who said:
One man ‘s larger pay packet is another man ‘s job.
He said- and this was in late 1 974:
It is becoming clearer every day that increased labour costs are in part responsible for retrenchments and reassessments of labour requirements in a wide range of industries.
A few weeks later he was dismissed from office. However, what was true in 1974 is true todaythe greatest threat to recovery in employment is continued inflation and particularly continued escalation in wage costs. Built-in inflationary expectations add to pressure for higher wagesthese expectations can be progressively reduced only if the rate of inflation is seen to be coming down. The Government believes there is a growing realisation in the community that large money wage increases are not the way to improve real living standards and put people back to work. A recent gallup poll snowed that most of those polled did not favour the recent 6.4 per cent increase. An interesting comment on the thesis that it had to be awarded because of community expectations.
Most in the community, it seems, are not subject to the money illusion which so distorts the vision of some that they applaud a money wage increase which can only harm recovery and cut back employment opportunities. It is not going too far to say that wage-cost pressures, intensified as they have been by the 6.4 per cent decision, are a threat to our economic survival. The Government has a duty to the community to pursue every possibility of reducing such pressures. In the last resort unless inflation is controlled there will be no soundly-based return to prosperity and no lasting creation of employment opportunities. The Government is under no illusion that this is an easy task.
Inflation is like a drug; it destroys incentive and drains the energy of the whole communityyet withdrawal from it must produce painful side-effects. But if we are concerned with Australia in 1 980 we have no choice but to kick the inflationary habit. The Government has a responsibility to say this clearly to the community and to do what it can to enlist the support of all in doing so. We are confident that a policy wholeheartedly directed against inflation will in fact command wide support from the community and that in the next 3 years a great advance to our goal of a freer, fairer, more prosperous Australia can be made.
Debate (on motion by Senator Keeffe) adjourned.
Debate resumed from 3 March, on motion by Senator Knight:
That the following Address-in-Reply be agreed to:
To Mis Excellency tks Governor-General
May it Please Your Excellency-
We, the Senate of the Commonwealth of Australia in Parliament assembled, desire to express our loyalty to our most Gracious Sovereign, and to thank Your Excellency for the Speech which you have been pleased to address to Parliament.
Upon which Senator Harradine had moved by way of amendment:
That the following words be added to the AddressinReply, viz.: “and the Senate is of the opinion that your advisers having declared their intention of taking particular care over the special circumstances of the less populous States, should obtain the approval of those States prior to the implementation of your advisers’ new approach to Federalism”. and upon which Senator Brown had moved by way of amendment to Senator Harradine ‘s amendment:
At end of proposed amendment, add “. The Senate is also of the opinion that, because of the financial plight of local government organizations throughout Australia, your advisers should take action immediately to re-institute hearings by the Australian Grants Commission for the purpose of assessing appropriate untied and unconditional grants to local government”.
– I continue my remarks in this unique AddressinReply debate by pointing out that the GovernorGeneral has express power under the Constitution to dissolve parliament. In regard to the House of Representatives, it is expressly provided that its term shall be for 3 years unless sooner dissolved by the Governor-General. In the situation that developed the former Prime Minister made it firmly clear that he was adamant that in response to the Senate’s objection to the Appropriation Bills he would neither advise an election nor resign. Some Opposition senators said that it was the former Prime Minister’s duty to consult the law officers of the Crown. A wider reference about the advice given by the law officers of the Crown was made by Senator Brown yesterday. That advice was given over the signature of Mr Byers, Q.C. It is in the form in which it was intended to be a joint opinion by Mr Byers and by the former Attorney-General, Mr Enderby. Mr Enderby ‘s signature does not appear on the document. We were told by Senator Brown yesterday- for the first time so far as I know- that Mr Enderby crossed out Mr Byers’ signature on the document before he left it with the Governor-General. If the document was presented by its authors in that rubbishy form, the Governor-General can scarcely be criticised for not attaching to it any greater authority or status than did the authors.
This information came to public light through the unprecedented action of the SolicitorGeneral, Mr Byers, who took it upon himself to publish in the national Press these confidential advisings that he had prepared for no less a dignitary than the Governor-General. This very same Solicitor-General reminded honourable senators when he was giving evidence on the loans affair, I think in July or August, that the counsels of the Crown are secret and should not be disclosed. He went to the extent of claiming that he was not obliged to give to the Senate information as to his advisings on that matter, even though the former Prime Minister had gone out of his way to state the advisings of the previous Attorney-General in respect of that matter. So much for the law officers’ advice, given on 4 November, which discussed the very proposition of the Governor-General’s powers to dissolve parliament. It emphasised opinions as to whether or not, in the existing circumstances, the Governor-General was compelled to dissolve the Parliament. On page 1 1 of that opinion it states:
The question thus is whether the deferring of Supply by the Senate solely to procure the resignation, or failing that, the dismissal of the Ministry as a step in a forced dissolution of the Representatives compels His Excellency to dissolve that House. The existence, nature or extent of the GovernorGeneral ‘s reserve powers of dismissal or dissolution in other circumstances do not arise. On those questions, we express no opinion. By forced dissolution we mean one occurring when, ‘the Crown insists on dissolution and, if necessary, dismisses Ministers in order to procure others who will tender the desired advice’.
So, the precise question of dismissal was under consideration by the Government’s legal advisers a full week before the axe fell. During that time not only- as it has been revealed- did the Governor-General consult his ordinary law advisers but also, according to Senator James McClelland, he had contact with some members of his Executive Council because of the special relationship existing between them of a lifelong friendship. He no doubt addressed himself to Senator James McClelland because of his position in the Ministry and because of his legal training. In the face of all this the previous Prime Minister was adamant that he would not resign. He adopted a defiant attitude. He denied the power of the Senate to adjourn or reject appropriation. I should like to quote a passage in Forsey’s work on the Royal Power of Dissolution of Parliament in the British Commonwealth prepared in 1943- the year of the first edition. At page 259 of the 1968 edition, in the conclusions that the author sets down, it is stated:
The danger of royal absolutism is past; but the danger of Cabinet absolutism, even of Prime Ministerial absolutism, is present and growing. Against that danger the reserve power of the Crown, and especially the power to force or refuse dissolution, is in some instances the only constitutional safeguard. The Crown is more that a quaint survival, a social ornament, a symbol, ‘an automaton, with no public will of its own’. It is an absolutely essential part of the parliamentary system. In certain circumstances, the Crown alone can preserve the Constitution, or ensure that if it is to be changed it shall be only by the deliberate will of the people.
I suggest that if the author had to write again in the light of this experience he could not write a passage more appropriate to the occasion of this crisis. I suggest to honourable senators that it was when Mr Whitlam adopted such a defiant attitude that the Governor-General saw not an abuse from the point of view of royal absolutism but an abuse from the point of view of Prime Ministerial absolutism which called for careful consideration by the Governor-General. As the events succeeded each other, of course, the time span was important. We are told- now it has been disclosed among other secrets of the Crown by Senator James McClelland- that no later than 5 November there was a Council summoned by the then Prime Minister in his chambers. It included the then Attorney-General, Senator James McClelland, electoral officers and other persons to advise the Ministry. They were forcibly and strongly told that the last practicable date upon which an election could be held was 13 December. For that purpose, it would be necessary for dissolution to occur some time in the week of 1 1 November to encompass all the electoral proceedings. Quite obviously, the Governor-General was presented with a practical predicament as to whether or not he, responsible for the executive government of the Crown, could carry on that Government if Parliament failed to provide the money and the government failed to vacate office or go to an election. In the light of the law advisers’ advice to which I have referred, the Governor-General sought the advice of the Chief Justice. That is a succinct piece of advice that should be written in bold letters so as to enshrine it as a clear statement of clear constitutional principle. In 1914 the Chief Justice had been consulted by the GovernorGeneral of the day on the question of dissolution. In England the chief judicial officer, the Lord Chancellor, is a member of the actual Cabinet and is privy to consultations not merely upon constitutional matters but on all political matters. Preserving the proper responsibilities of the office, what better and what more reliable advice could the Governor-General seek and get than from the Chief Justice? The Chief Justice made a statement, part of which I seek to incorporate in Hansard.
The DEPUTY PRESIDENT (Senator Bonner)- Is leave granted? There being no objection, it is so ordered. (The document read as follows)-
In response to Your Excellency’s invitation I attended this day at Admiralty House. In our conversations I indicated that I considered myself, as Chief Justice of Australia, free, on your Excellency’s request, to offer you legal advice as to Your Excellency’s constitutional rights and duties in relation to an existing situation which, of its nature, was unlikely to come before the court. We both clearly understood that I was not in any way concerned with matters of a purely political kind, or with any political consequences of the advice I might give.
In response to Your Excellency’s request for my legal advice as to whether a course on which you had determined was consistent with your constitutional authority and duty, I respectfully offer the following.
The Constitution of Australia is a federal Constitution which embodies the principle of ministerial responsibility. The Parliament consists of two Houses: the House of Representatives and the Senate, each popularly elected, and each with the same legislative power, with the one exception that the Senate may not originate nor amend a money Bill.
Two relevant constitutional consequences flow from this structure of the Parliament. First, the Senate has constitutional power to refuse to pass a money Bill: it has power to refuse Supply to the Government of the day. Secondly, a Prime Minister who cannot ensure Supply to the Crown, including funds for carrying on the ordinary services of government, must either advise a general election (of a kind which the constitutional situation may then allow) or resign. If, being unable to secure Supply, he refuses to take either course, Your Excellency has constitutional authority to withdraw his commission as Prime Minister.
There is no analogy in respect of a Prime Minister’s duty between the situation of the Parliament under the federal Constitution of Australia and the relationship between the House of Commons, a popularly elected body, and the House of Lords, a non-elected body in the unitary form of government functioning in the United Kingdon. Under that system, a Government having the confidence of the House of Commons can secure Supply, despite a recalcitrant House of Lords. But it is otherwise under our federal Constitution. A Government having the confidence of the House of Representatives but not that of the Senate, both elected Houses, cannot secure Supply to the Crown.
But there is an analogy between the situation of a Prime Minister who has lost the confidence of the House of Commons and a Prime Minister who does not have the confidence of the Parliament, i.e. of the House of Representatives and the Senate. The duty and responsibility of the Prime Minister to the Crown in each case is the same: if unable to secure Supply to the Crown, to resign or to advise an election.
-The Chief Justice, to summarise the position, made it quite clear that in a federal constitution the refusal of this chamber to join in the grant of appropriation could not be ignored and the Executive could not legally carry on government without parliamentary appropriation. In those circumstances, the
Governor-General was within his legal rights if he saw fit to dissolve the Ministry and seek an interim Ministry which would secure from the Parliament Supply and advise a general election. So the Governor-General made his decision. He did not, as some people said yesterday, take such action without vouchsafing his reasons for taking this action. Very wisely, he took the course of accompanying his letter of dismissal to the previous Prime Minister with a statement of reasons to be publicised so that the country could understand that the purpose of the GovernorGeneral ‘s action was that the ultimate sovereign power in this country, namely, the vote of the people at a secretballot, could be obtained, and it would lead to a solution of the constitutional difficulty. There is a passage in an article by Professor O’Connell in the Parliamentarian of 17 January which I desire to quote. At page 1 1 he stated:
The Governor-General has also been criticised for dissolving Parliament when the House of Representatives had demonstrated that only Mr Whitlam enjoyed its confidence. It has been contended that he should have called upon Mr Whitlam to form a new Government. But the GovernorGeneral knew that the vote of no-confidence in the House was a charade.
So, it is quite clear that the Governor-General had no practical course other than the one of dismissing the Ministry and calling for a caretaker government. Mr Whitlam ‘s immediate reaction was to enact a charade in the House of Representatives whereby that House passed a resolution condemning Mr Fraser and affirming confidence in Mr Whitlam. Professor Colin Howard, whose name has come under notice in the course of this controversy, took it upon himself to write to the London Times on that matter on 1 8 November. In the course of that letter he said:
Before Parliament purported to be dissolved the Senate had passed the budget legislation and the new Prime Minister had lost a vote of confidence in the House of Representatives. This meant that Mr Whitlam could perfectly well have continued to govern and Mr Fraser should certainly have resigned. The Governor-General failed to receive official notice of the vote in the House only because he declined to receive the Speaker before the purported dissolution.
Writing in reply in the London Times on 25 November, Professor O’Connell, supported by Reader J. M. Finnis, both of the Oxford University, had this to say:
Professor Howard thinks that, once the Senate had voted supply and the Representatives had expressed no confidence in the new Ministry, Mr Whitlam should have been reinstated. But, since the Senate, in voting supply nem con, unquestionably acted on its knowledge that a caretaker government was in office and a lawful dissolution imminent, the reinstatement of a Prime Minister adamantly opposed to such a dissolution would have been an unconscionable fraud on the Senate, not to say an absurdity. Notoriously the new Ministry lacked the support of one elected House; equally notoriously, the former Ministry was unable to continue governing constitutionally, for want of sufficient support in the other elected House.
Therefore, any reference to that no-confidence resolution simply indicates that there is a disposition on the part of some people to rely upon what the intelligent call a charade and a palpable fraud. Having whipped up that charade within the Parliament, Mr Whitlam went to the steps of Parliament House and whipped up anger among the people who came along to see the circus. First of all, he distinguished the level of his debate by calling Mr Fraser, as he passed, Kerr’s cur’, and he observed in equally respectable language: ‘God might save the Queen, but nothing will save the Governor-General’. So the ex-Prime Minister went around the country drawing crowds. The excitement was attractive and those who wished to see a spectacle went in increasing numbers. The Leader of the Labor Party was so dull in his perception of the political situation that he did not discern the huge mass of purposeful opinion that went to the polls on 1 3 December and rejected the Whitlam Government by such an overwhelming majority.
Some reference has been made to the debate on the constitutional aspect which took place in that campaign. I wish to make only brief reference to the fact that on the day following the dissolution- that is, on 12 November- the editorial in the London Times under the caption of Australia ‘s Crisis’ had this to say:
The Governor-General did not feel he could let the country drift into the dangers of being led by a government without money to pay its servants or bills, and therefore has himself forced the appeal to the electorate, by putting Mr Fraser into office simply to hold a prompt general election.
Leaving out one or two sentences, the article continued:
On the same day there appeared in the London Times an article by a contributor whose status is unknown to me but who bears the name of Phillip Howard. He said:
Although no doubt uncomfortable and irritating to those principally concerned, the present constitutional crisis in Australia is a marvellous example of the Constitution working well in a crisis.
That was before the demonstration of the vote on 13 December; but it could be perceived by a distant objective reviewer that these procedures were a marvellous example of the Constitution working well in a crisis. Professor Colin Howard took up the running and, having noticed those remarks, he contributed to the Times on 18
November in a short letter, all of which is pithy and to the point. He was critical of the GovernorGeneral’s action in certain respects. He was replied to on 25 November by Professor D. P. O ‘Connell, Professor of Public International Law, All Souls College, University of Oxford, supported by Mr J. M. Finnis, Rhodes Reader in the Laws of the Commonwealth and the United States, University of Oxford. I seek leave to have those 2 short letters incorporated in Hansard.
The ACTING DEPUTY PRESIDENT (Senator Melzer)- Is leave granted? There being no objection, leave is granted. (The documents read as follows)-
DISMISSAL OF MR WHITLAM
From Professor Colin Howard
Sir, Your editorial on the dismissal of Mr Whitlam by Sir John Kerr (November 12) is an exercise in the unreal. You have failed to appreciate the incredulity with which the news was first greeted across the country and the sense of shock which followed. In consequence you have not analysed the reasons for this reaction. You have also, owing no doubt, to incomplete information at the time, omitted to take into account the questionable way in which Sir John carried out the operation. You manage as a result to credit him with common sense and imply that he displayed statesmanship. On the contrary. There are now a great many voters of all shades of opinion in this country who are asking themselves if they need enemies with a friend like that.
We are in the midst of a political and constitutional crisis which was already beginning to cause some hardship and much inconvenience. Mr Whitlam and Mr Fraser had both taken stands on points of principle. Public opinion, which not long ago was well against Mr Whitlam on his record, had moved rapidly and decisively in his favour. This showed not merely that the majority thought that he was right on this particular point but also, and most importantly, that the community at large felt itself deeply and directly involved in the issue.
The quality of public comment was high and serious. The sense of the community appeared to be one of moderate, self-disciplined determination to see the thing through and force both sides to seek a political accommodation. The hope was to preserve the primacy of the House of Representatives without destroying Mr Fraser. Clear signs were emerging that behind the intransigent rhetoric, politicians were responding to this sentiment. There was still plenty of time for it to happen.
Out of the blue we were suddenly told that the merely titular non-elected head of state had taken the matter out of our hands in a manner which offended against just about every canon of parliamentary government one can readily call to mind. A few examples:
He dismissed the Prime Minister who held the confidence of the House of Representatives without giving him the slightest inkling of what was proposed.
He acted without consulting his own law officers but after secret consultation with the Chief Justice of the High Court, who may well have to adjudicate at some future time on the validity of his actions.
He acted on the basis of assumptions of fact the correctness of which he could not know.
He purported to dissolve both Houses of Parliament without any demonstration that he possessed constitutional power at the relevant time to do so. The existence of that power is highly questionable.
Before Parliament purported to be dissolved the Senate had passed the budget legislation and the new Prime Minister had lost a vote of confidence in the House of Representatives. This meant that Mr Whitlam could perfectly well have continued to govern and Mr Fraser should certainly have resigned. The Governor-General failed to receive official notice of the vote in the House only because he declined to receive the Speaker before the purported dissolution.
He installed a government which does not have the confidence of the House of Representatives under circumstances which enable it to govern without parliamentary sanction and to run its election campaign with all the advantages of a government in office.
Sir John Kerr has not acted with wisdom or propriety. He has acted in paternalistic manner more befitting a politically immature colony than a responsible independent nation. His literal powers under the constitution are nothing to the point. It is perfectly clear from our classic commentary on the constitution by Quick and Garran (see for example pages 406 and 685), published in 1901, that those powers were from the outset intended to be exercised only on the advice of his ministers. Until now they always have been. As for the Senate’s refusal to pass Supply, it is known to every Australian that this had nothing to do with safeguarding the states. It was a straightforward political power-play, also without national precedent until last year.
It is no wonder that many Australians feel alarmed and indignant. Some dangerous passions have been unleashed. Sir John Kerr was extremely misguided to appear to give his official sanction to what were no more than tough tactics by the Opposition which the community was in the process of evaluating for itself.
Yours faithfully, C. HOWARD, Hearn Professor of Law, University of Melbourne Law School, Parkville, Victoria, Australia.
THE DISMISSAL OF MR WHITLAM
From Professor D. P. 0 ‘Connell and Mr J. M. Finnis
Sir, Professor Howard (November 18) argues that the Governor-General of Australia’s action in dissolving Parliament for an immediate general election (18 months after the last) has ‘taken the matter out of our hands’. Whose hands? He says it was improper because it ‘offended against just about every canon of parliamentary government’.
Sir John Kerr dismissed the Prime Minister ‘without giving him the slightest inkling of what was proposed’. Sir John’s letter of dismissal (not reported in this country) makes it clear why Mr Whitlam himself, speaking publicly soon after the event, did not make any such allegation. The Governor-General’s letter reads: ‘You have previously told me that you would never resign or advise an election of the House of Representatives or a double dissolution and that the only way in which such an election could be obtained would be by my dismissal of you and your ministerial colleagues. As it appeared likely that you would today persist in this attitude I decided that, if you did, I would determine your commission and state my reasons for doing so. You have persisted in your attitude and I have accordingly acted as indicated’.
‘He acted without consulting his own law officers’. Sir John has publicly stated that he consulted the AttorneyGeneral, and your own reports (November 19) indicate that he received, several days before the dismissal, an opinion from both his law officers on many, perhaps all, of the issues involved in that action. The effective head of state in a parliamentary system is indeed bound to consult his law officers at all stages of a constitutional crisis up to the time when he decides that he is constitutionally required to reject this advice. (We do not know what they advised in this case.) But equally he must be entitled to seek other opinion on the question whether the advice of ministers is to be rejected or not. In the past, the Governor-General of Australia has been advised by his Prime Minister that he is entitled to exercise his own judgment as to certain matters connected with dissolution of Parliament. That opinion must certainly be correct when the effective head of state could reasonably form the view that his ministers were embarked on a course of gravely unconstitutional conduct. On July 11, 1975, Professor Howard wrote to 77ie Age (Melbourne) to say that if a government sought to by-pass parliamentary control over supply in order to avoid a forced election, it would strike ‘a blow at our system of government the seriousness of which it is difficult to over-estimate ‘.
The Governor-General was advised by the Chief Justice on this point as follows: ‘First, the Senate has constitutional power to refuse to pass a money Bill: it has power to refuse supply to the Government of the day. Secondly, a Prime Minister who cannot ensure supply to the Crown, including funds for carrying on the ordinary services of government, must either advise a general election (of a kind which the constitutional situation may then allow) or resign. If, being unable to secure supply, he refuses to take either course, Your Excellency has constitutional authority to withdraw his commission as Prime Minister’.
The Governor-General acted ‘after secret consultation with the Chief Justice . . . who may well have to adjudicate at some future time on the validity of his action’. But Professor Howard could not know whether the GovernorGeneral’s consultation extended to any matter as to which any serious and justiciable question could be raised by the High Court. In fact the Chief Justice prefaced his advice to the Governor-General with the opinion that the situation ‘of its nature ‘ was unlikely to come before the Court.
‘He purported to dissolve . . . Parliament without any demonstration that he possessed constitutional power . . . to do so. The existence of that power is highly questionable’. But, as a member of the team of the Labour Attorney-General at the time of the 1 974 double dissolution, Professor Howard knows that, at that time, there were in the High Court expressions of judicial disapproval of any attempt by a Governor-General, in proclaiming a double dissolution, to recite any such ‘demonstration’. As to the existence of the power in this case, Mr Whitlam himself did not question it and, the day before Professor Howard wrote, admitted: ‘A double dissolution was possible this week . . . because of the 2 1 other Bills already twice rejected by the Senate’, The proclamation of dissolution recites these Bills.
Professor Howard thinks that, once the Senate had voted supply and the Representatives had expressed no confidence in the new Ministry, Mr Whitlam should have been reinstated. But, since the Senate, in voting supply item con, unquestionably acted on its knowledge that a caretaker government was in office and a lawful dissolution imminent, the reinstatement of a Prime Minister adamantly opposed to such a dissolution would have been an unconscionable fraud on the Senate, not to say an absurdity. Notoriously the new Ministry lacked the support of one elected House; equally notoriously, the former Ministry was unable to continue governing constitutionally, for want of sufficient support in the other elected House.
A constitutional lawyer ought to grant that the issues involved in this crisis have nothing at all to do with independence or colonialism, or hereditary monarchy, but everything to do with the rational coherence of the parliamentary system, which requires an effective head of state with the responsibility of acting in the way that Sir John Kerr has acted, in the most unusual sort of circumstances here involved. Mr Whitlam said in the lower House on June 12, 1970, ‘Any government which is defeated by the Parliament on a major taxation Bill should resign . . . This Bill will be defeated in another place (i.e. the Senate). The Government should then resign’. Such was a first premise of the Governor-General’s action. And the objective of that action was simply to enable the authentic sense of the community to be determined.
P. O ‘CONNELL, Chichele Professor of Public International Law, All Souls College.
M.FINNIS, Rhodes Reader in the Laws of the Commonwealth and the United States, University of Oxford.
-From those letters it appears, on the authority of no less a person that Professor O ‘Connell, that the Constitution was ably administered by the Governor-General through this crisis, and so the ultimate verdict was sought from the people. The GovernorGeneral said that all the procedures he took were for the very purpose of enabling the people to pass their verdict. In the circumstances- the exceptional inflation in which the country was being drowned, the high interest rates, the record unemployment, the depressed rural industries, a tariff decision still operating to an overall cut of 25 per cent, a deficit in the Budget that is now approaching $5 billion, and the wake of the loans scandal, in which there had been an attempt to raise from external sources, by unconventional means, no less than $4,000m- it is a matter of great satisfaction that the public of Australia could be relied upon to solve a constitutional crisis, to give confirmation to the GovernorGeneral, and also to solve a political crisis.
We should realise that it was the same Professor Colin Howard who on 1 1 July 1975 contributed a letter to the Melbourne Age in which he asserted that the purpose of Mr Whitlam ‘s attempt by unconventional means to sidetrack the Loan Council and get $4,000m was that Mr Whitlam in particular and the Labor Government seemed to have been pre-occupied with methods either of manipulating Parliament illegitimately in the Gair affair or, failing that, with creating a set of circumstances in which Parliament might for significant periods be ignored.
He then went on to point out that the control of money was at the heart of government and said that Mr Whitlam must know that but he seemed to have no respect for it. ‘In my view’, said Professor Colin Howard, ‘the loans scheme was simply an attempt to open up an extraparliamentary source of supply which would be available not, to be sure, to by-pass Parliament forever but to keep a Government afloat for long enough time to ride out the threat of another forced election’. I quote those words as an epitaph to Professor Colin Howard’s contribution to this debate. He affords in that letter of July the most despicable purpose for which the loans scandal was conceived and that was the very purpose of supplying the then Government with funds if the Parliament did not.
So, I have attempted to bring together a few of these documents for the record. This is the first opportunity that one has had to speak since this dissolution. It would be inappropriate to the remarkable occasion of the dissolution, its constitutional significance and the signal victory that the Australian people registered for the maintenance of proper constitutional procedures and for the restoration to government of a government of responsibility not to deal with that matter. Therefore, Madam Acting Deputy President, I have unusual spirit in joining in the motion that we address a reply of appreciation to the Governor-General on this occasion.
– We are debating the Speech delivered by the Governor-General on behalf of the present Prime Minister (Mr Malcolm Fraser). I remind the Senate once again, as my colleagues who have spoken before me have done, that this debate would not be taking place now if it had not been for the untimely death of our esteemed colleague and former senator, Bert Milliner. That circumstance has been explained over and over again in this chamber. If Bert Milliner had not passed away, those who now sit on the Government benches could not have forced an election. That is the way in which they came to power. They used the death of a senator as an occasion to collude with the Governor-General to bring about an election.
We have heard Senator Wright desperately trying to whitewash the actions of the GovernorGeneral in dismissing a properly elected Government from office. He has told us that Mr Menzies was dragged from retirement- he said this in his speech last night- to issue a statement in support of the Governor-General’s actions. If we refer to and study some of the decisions and speeches made by Mr Menzies in years gone by, we see that the Press statement that he issued prior to the election taking place was completely contradictory of ones he made many years before. Senator Wright spoke last night at the conclusion of the speech by Senator Brown. May I add that I quite concur with the last 2 sentences of the speech delivered by Senator Brown. Senator Wright said that Senator Brown’s statement in relation to the Governor-General was contemptible. I say to Senator Wright that the actions of the former Opposition- the present Govermentin conjunction with the Governor-General were contemptible.
In his speech, Senator Wright went on to say:
Honourable senators will remember that this impish Prime Minister-
He was referring to Mr Whitlam: trotted out for our consideration a letter written by Sir Robert Menzies about 30 years ago in relation to the Game situation and the rejection of a money Bill by the Upper House in New South Wales.
But he did not quote all of what was said by Sir Robert Menzies- or Mr Menzies as I should refer to him. As I have pointed out to the Hansard staff on many occasions, I do not use titles which have been granted for political purposes; so it is Mr Menzies in this case. Senator Wright did not quote all of the letter of 3 November 1 932. This would be the letter to which Senator Wright referred. It was to the Governor of New South Wales, Sir Philip Game and is quoted in Dismissal of a Premier- the Philip Game PapersBethia Foott, Morgan Publications (Syd.) 1968, pages 2 1 9 to 222. This is what Mr Menzies had to say in 1932:
Under the Australian system of universal suffrage and triennial Parliaments, with a legally recognised and responsible Cabinet, it must, in my opinion, follow that so long as a Premier commands a majority in the Lower House, and so long as he is guilty of no illegal conduct which would evoke the exercise of the Royal Prerogative, he must be regarded as the competent and continuing adviser of the representative of the Crown. For a newspaper to urge a dissolution because in its opinion the Government has lost the confidence of the electorate is a mere impertinence.
This is what the Australian newspaper was engaged in prior to the sacking of the Whitlam Government on 1 1 November 1975. Mr Menzies went on to say:
The constitutional authority of a Premier rests almost entirely upon his success at a general election and upon his continued authority in the popularly elected House, and not upon irresponsible speculations as to whether he would have lost his majority if the Constitution had provided for annual and not triennial elections.
That is where Senator Wright concluded his quotation.
He did not go on to say that Mr Menzies had made another statement in 1968 dealing with the same matter. Mr Menzies argued in the Daily Telegraph of 1 1 March 1968 that, while legally a hostile Senate could reject a money BUI this would create ‘an impossible situation and make popular government unworkable ‘. He said that if a Senate could force the fall of a government by rejecting money Bills proposed by it in the exercise of its financial responsibilities for the government of the country, no future government could safely hope to govern Australia effectively unless it had control of both Houses. Every time a money Bill came before a Senate which the government did not control, the government would be placed in jeopardy. That is exactly what will transpire in the future because the precedent has now been set by which a party having the numbers in this place, irrespective of whether it has the numbers in the other place, can force an election every 6 months if it wants to, that is, every time a Supply Bill is introduced in this chamber.
Senator Wright tried to push aside what his former leader had said as being something which had been said in the dim past, implying that we should not take any notice of it and that the faculties of that leader would be sharper last year than they were 30 years ago. Senator Wright claimed that we should not take any notice of what his former leader had said many years ago and even as late as 1968. As reported at page 404 of yesterday’s Hansard, Senator Wright went on to refer to:
So Senator Wright completely turned his back not only on what Mr Menzies said but also on what 3 other members of his Party have said on the same issue. One of them now sits in the other place. I refer to a Press release issued on 10 May 1967 by the Prime Minister of the day, Mr Harold Holt. The Press release is No. 52/1967, and it reads:
It is one of the most firmly established principles of British parliamentary democracy that a House of Review should not reject the financial decisions of the popular House. The terms of the Commonwealth Constitution reflect this principle.
That was a statement by Mr Holt. I am sure Senator Wright supported him wholeheartedly when Mr Holt was Prime Minister. I have a statement by Mr David Hamer who was elected at the last election. It surprises me that after making this statement Mr Hamer even saw fit to offer himself for election on 13 December last year. In an article in the Age on 1 8 February 1 974 he had this to say:
Such a precedent could well render Australia ungovernable. Governments frequently have to make hard decisions, which will be unpopular in the short-term in the hope that their beneficial long-term effects will be apparent before they have to face the electors.
It would be outrageous if a government, whenever it took such a hard decision, could be forced into an election at the whim of minor parties in the Senate. The disastrous effect would not be that there would be many elections but rather that hard but necessary decisions would not be taken.
Mr Hamer, after holding that opinion and making that statement, and in the light of the events which took place, saw fit to offer himself for election. As a result he was re-elected to this Parliament under a system with which he himself did not agree.
The then Senator Gorton made a statement on 25 August 1953. 1 am sure that those honourable senators who sit opposite me and who were here when Mr Gorton was the Government Leader in the Senate and when he was Prime Minister agreed with everything he said. I can remember reading many Press statements in which John Gorton was put up by the Liberal Party as one of the most outstanding Prime Ministers we have ever had. In the Age on 25 August 1953 Mr Gorton stated: the problem of preventing the Senate from inhibiting and frustrating government can be solved (by Constitutional amendment) . . . First, deprive the Senate of the power to reject Supply, for if it is to defeat a government it should do so on a specific measure, not on general grounds of dislike. Second, if the Senate does defeat a government on a specific measure, then, instead of a double dissolution, the Senate alone should go to the people . . . This would prevent an Opposition with a majority in the Senate from using that majority capriciously, because no party would jeopardise such an advantage except on a matter of fundamental importance.
There we have the opinion of 3 Liberal Party Prime Ministers. We find Senator Wright trying to disown one of them. Senator Wright tried to disown what Mr Menzies said as if it were worthless. Senator Wright did not mention Mr Holt, another Liberal Prime Minister. The third Prime Minister was Mr Gorton who was taken out of this chamber to become Leader of the Party because at that time the Party had no one in the House of Representatives capable of doing the job. It had to come into this chamber to find somebody.
– Why don’t you do the same?
– We have a very capable Leader as was pointed out in the House today. Our Leader got under the skin of the members of the Liberal Party and they are running for cover. If Senator Withers had been over there when Mr Bowen, the member for Kingsford-Smith, was speaking today, he would have seen the way in which the Attorney-General (Mr Ellicott) scuttled out of the House because he could not take what Mr Bowen was putting to him and Senator Withers would alter his tune. But these are the things our opponents are now throwing up. They are trying to run away from the issue. As I have pointed out, and it is now on the record for all to read, the things that the Liberal Party wants to run away from do not hold water when we look back at some of the statements which have been made by past Prime Ministers.
I congratulate my colleague, Senator James McClelland, for his most enlightening speech in the Senate on Wednesday, 18 February. For people who may not have read the Hansard report I point out that they will find the speech on page 56. They will see that Senator McClelland revealed some of the conversations which took place between himself and the Governor-General. He revealed conversations which took place prior to the sacking of the Government. I wholeheartedly agree with what he had to say. Senator McClelland ‘s revelation so pricked the conscience of Senator Cormack that he came in here on Tuesday, 24 February, and proceeded to deliver a lecture on conventions. But he himself was a willing party to these conventions which he broke because of his lust and that of his Party for power. My speech during the adjournment debate on 30 September last year spelt out the chain of events which were set in motion 12 months before to bring about the climax on 1 1 November. We have never had a denial from the Prime Minister of what I revealed in the Senate that night in relation to how he was organising with the help of Mr Street and Mr Staley to get rid of the then Leader of the Liberal Party, Mr Snedden. Of course, I was laughed at when I made that statement in the Senate. But since then everything has fallen into place. Everything I said that night has been proved to be true.
Senator Cormack who is such a great upholder of convention- so he says- was deeply involved in the whole plot, as was Senator Withers. Senator Walsh in his speech last Wednesday proved this last point when he quoted from a television interview in Perth on which Senator Withers publicly said that as far back as 1973 he had devised the method by which the Labor Government could be brought down. We all know what happened in the chain of events. That has been well recorded. What Senator Withers had to say at that interview as Senator Walsh revealed to this chamber last week was also published in the Adelaide Sunday Mail of 11 January. Just to remind honourable senators I quote from the article:
Senator Withers also said the blocking of the Supply Bill last November had been a planned operation dating back to October, 1973.
– Hear, hear!
- Senator Withers says: Hear, hear!’, yet when the Liberal Party went out on the hustings at election time it said that the reason it had to take the Government to the people was the economic circumstances prevailing at the time. But the honourable senator freely admits that in 1973, less than 12 months after the Whitlam Government was elected, he was conniving to get rid of it by using the power in this place to deny Supply. We find that even though the Government was twice elected within a space of 18 months the honourable senator’s Party did not accept the will of the people. We had a joint sitting of Parliament. I shall say something a little later about the legislation which was passed then. The joint sitting passed certain legislation after the people of Australia had twice voted for that legislation as Labor Party policy. But what did the Liberal and National Country Parties do? They still would not accept the will of the people. They took the legislation to the High Court and challenged it. In relation to only one piece of that legislation were they successful. That was because there was a time lag of 3 days less than the 3 months which should have lapsed. The legislation was not found to be invalid. It was the time factor which invalidated the legislation and that is why it was rejected. Every other piece of legislation was upheld.
I shall go further and follow up what Senator Cormack had to say when he came into the chamber. He told the Senate that he would set down in chronological order all the events which took place leading up to the sacking of the Whitlam Government. If we look at page 1 7 1 of the Senate Hansard of 24 February we find that Senator Cormack stated:
People cannot live together and conduct their businesses together unless there is some obedience paid to forms and conventions.
What a person to be talking about conventions! The honourable senator continued:
But what happened that day, what has ‘happened since and what in fact happened before, create an alarming situation for the young Australian electorate which is growing up … a one party State exists in Queensland. One party States exist in every socialist country of the world that claims to be a socialist country.
Fancy Senator Cormack citing Queensland as an illustration of a one-Party State. It is run by a National Country Party Premier who has the State gerrymandered to such an extent that the
Australian Labor Party would have to get in excess of 62 per cent or 63 per cent of the vote to be able to win government. So Senator Cormack is well aware of what happens when we get a one-Party State like we have in Queensland under National Country Party leadership: The honourable senator stated further:
The significant character and quality of a one party State is that the Prime Minister of the day usurps the Constitutional functions which should be carried out either by a GovernorGeneral, in the case of Australia, or in the case of a Republic . . .
Who usurped the conventions of this country? I do not need to say who did that. The people of Australia know who subverted the conventions of this country. They know that it was done by Mr Fraser and Senator Withers, working in collusion with the Governor-General, as was pointed out in this chamber by Senator James McClelland last week. Senator Cormack went on to say:
I want to say to honourable senators that the chronological series of events that took place, about which there has been an enormous amount of lying, have never been made clear.
Senator Cormack never spoke a truer word. He came into this chamber with a document which he stated was a list showing the chronological order of the events which took place on 11 November and nowhere in that list which he tabled in the Parliament is mentioned the times that Mr Fraser visited the Governor-General’s residence at Yarralumla. I asked Senator Cormack by way of interjection:
What time did Mr Fraser call on him when the car was sent around the back?
Senator Cormack replied:
All right, Senator McLaren, I know.
Of course he knows, but he did not tell the Parliament. He did not have it typed out on the list which he tabled in the Parliament. He has on it all the times in regard to what Mr Whitlam did on that occasion, but there is no mention in it of what Mr Fraser did. Of course, we know that Mr Fraser was over there in a small annexe and that the car was planted round the back when Mr Whitlam arrived. As has been said by some learned people since then, if that car had not been planted around the back of Government House and Mr Whitlam had seen the car when he arrived there he could have turned around immediately, come back here, telephoned the Queen and withdrawn the Governor-General’s commission. Then, of course, the GovernorGeneral could not have sacked Mr Whitlam.
– That is quite right. It is all very well to say ‘nonsense’, but why did Mr
Fraser have his car hidden around the back of Government House? Why did he not come out into the open?
In view of what has transpired in the last week it would seem that Senator Withers, being in control of the police and no doubt being well aware of what transpired at Government House, would need only to look at the diaries of Mr Whitlam ‘s bodyguards to trace his movements on that day. I say to Senator Withers that if he has any honesty about him he will table in this Parliament a document showing the times and dates of the visits of Mr Fraser to Government House. Senator Withers must have had a look at the diaries of the security police who were Mr Fraser’s bodyguards at that time. So I say to him: Come clean and tell us of Mr Fraser’s visits. If he is prepared to do that we will have a base on which to argue, but at the present time all honourable senators opposite are trying to do is denigrate the former Prime Minister by drawing red herrings across the trail.
– Are you alleging that any illegalities have occurred?
– Just be quiet. Senator Withers has been yapping and yapping like Billy Burner. I went further. After Senator Cormack had finished his speech that evening I asked him to table some documents. He tabled the documents from which he quoted, but, of course, they were only a half-hearted attempt at outlining the situation. He included in those documents only what he wanted included in them and not the whole chronological order of events, which is what he said he was going to do. So I rose to my feet and I said:
I hope that you now have Mr Fraser’s timetable and will indicate when he went to Government House. You did not tell us about that. Yet you claimed that you had the events of the day in chronological order.
Senator Cormack replied:
Well, if Senator McLaren likes, I have another chronology here which I could read out to him and which would leave him flat on his face. But I do not intend to weary the Senate with this aspect any more.
Of course, falling flat on one’s face was uppermost in Senator Cormack’s mind that day because he rose on the adjournment to criticise members of the Opposition on the day of the opening of the Parliament and he was so incensed after he had spoken and my friend and colleague Senator Cavanagh was replying to him that in his haste to leave the chamber he tripped over a platform and fell flat on his face with his coat-tails over his head. Is it any wonder that he brought in the old cliche about falling flat on one’s face when just a few hours before he had done it in this chamber.
After Senator Cormack had finished his speech about the chronological order of events I rose and said:
Mr President, Senator Cormack quoted from some documents and in relation to one of them he said that if he tabled it I would fall fiat on my face. I ask him to table that document.
Senator Cormack said:
Mr President, I did not quote from any such document; I said I had it. I have tabled one document which gives a series of events in chronological order. I said that I have a document which, if I showed it to Senator McLaren, would cause him to fall flat on his face. I did not quote from it.
I then said:
I am asking him to table it, Mr President.
Senator Cormack said:
If he wants it he can have it, but I do not think he can ask for the tabling of a document from which I have not quoted.
The President said:
Senator Sir Magnus Cormack did not read from the document to which you have referred, Senator McLaren, and the other one has been tabled.
My reply was:
I have the answer. He has backed off.
More than a week has elapsed since that altercation took place and, although Senator Cormack said that I could have the document, he has made no move to show it to me or bring it to me. So, of course, he had nothing in that document which would substantiate some of the things that he said in this chamber. As I have said, I have read the document tabled by Senator Cormack. It is there for anybody to read. I ask anybody who is interested in this matter to go down to the records section and get a copy of this document, which has been done up in a red cover. It shows the chronological series of events about which Senator Cormack came into this chamber with a great flourish, but when one reads them one will see that there is nothing new in them. As a matter of fact, many things are missing from them. Obviously he does not want these events publicised.
As I said earlier, the Prime Minister has caused the diaries of Mr Whitlam ‘s bodyguards to be perused. Because of the many gaps in Senator Cormack ‘s document it is only right and proper that the diaries of the bodyguards who accompanied Mr Fraser should receive the same treatment and scrutiny in order that we may then know whom he visited and at what times up to and including the day of 1 1 November. I do not think we will get that information. Having been over in the other place today and listened to what went on, I am sure that Mr Fraser and Mr
Ellicott have a lot to hide and a lot to answer for and that they are going to be in serious trouble in the next week or so.
– They never borrowed money from the Arabs.
- Senator Chaney is saying that we have borrowed money from the Arabs. The only thing, upon which he is basing that argument is what the Government’s great friend and the man who helped it to win the election, Mr Murdoch, has said in his newspapers.
– And Mr St John has had a lot to say about that.
– And, of course, Mr Fischer, who was the president of one of the Liberal Party’s branches in New South Wales and who was a very esteemed member of the Liberal Party for quite a while, as was pointed out by Mr St John, who at one time was the great champion of the people who sit opposite, but who is now bad friends with them. Until we have all of this information the utterings of Senator Cormack are nothing more that a feeble attempt to justify the actions of the then Leader of the Opposition in collaborating with the Governor-General.
Mr Fraser ‘s actions leading up to the events of 11 November 1975 can be described as being nothing less than ones of duplicity, evasion of the truth and the issues confronting the people, full of deceit and at all times designed to subvert the will of the people as was twice recorded at the ballot box in the space of 1 8 months. Those are the sorts of actions that the new Prime Minister was engaging in last year to bring about the downfall of the Labor Government. I repeat that they were actions of duplicity, evasion, deceit and subversion. When we have as Prime Minister a person who will go to those lengths to bring about the downfall of a government legitimately elected twice in 18 months I think honourable senators opposite and the Liberal Party have a lot to answer for. It is no use supporters of the Government endeavouring to silence us on the events that led up to the dismissal of the Whitlam Government on 1 1 November. They are saying: ‘It is old hat. You are cry babies. You should not mention the matter’. I can assure honourable senators opposite that the members of the Parliamentary Labor Party and the Party’s organisation outside are determined to remind the Australian people continually of what took place and to show to what murky depths the Liberal Party sank in order to remove the elected Labor Government from office.
Mr President, I notice that you are now back in the chamber. I want to take the opportunity of congratulating you, as one South Australian to another, on your election to the office of President of the Senate. I also take the opportunity of congratulating Senator Drake-Brockman on being elected Chairman of Committees. I am sure that he will carry out his duties with great decorum and will not engage in the Jekyll and Hyde activities of the previous occupant of the position of Chairman of Committees, who vigorously enforced the Standing Orders while occupying the Chair and just as vigorously flouted the same Standing Orders while on the floor of the chamber.
– Order! You must not reflect upon a member of Parliament, Senator McLaren.
- Mr President, I am attacking the office and the way the duties of that office were performed. I am sure that you would be a much happier occupant of the President’s office if the circumstances which led up to the events of last November had been ethical and in conformity with recognised conventions. I hope that you will not take offence at what I am about to say, but it is something that I have observed.
– You have overheard another conversation, have you?
– That is something that honourable senators opposite have never denied, anyway. The matter that disturbs me, Mr President, is your decision to be garbed in the presidential regalia. I am sure that it is causing you as much discomfort as the ill-fitting headgear caused Senator Cormack when he was the President. Many of us remember his tussles to keep it straight and then his having finally to lay it aside in frustration. I think that many titters went around the Senate chamber when Senator Cormack wrestled with the thing in order to keep it straight. I have noticed that you have had the same problem. I also have noticed that there has been some concern from some of the Government senators on your right at not being able to catch your eye at times because your vision is obscured by the headgear when it remains stationary while you turn your head, and then you have a blind side. In a jocular fashion, I would like to say that sometimes, looking across at your headgear, it reminds me of a fractious trotter wearing blinkers. Sometimes I also think of that comic strip called ‘Fred Basset’ which appears in the newspapers. I am reminded of it because of the wattles hanging down.
I want to congratulate my colleague from the Northern Territory, Senator Ted Robertson, on his election to the Senate. It has been a long drawn-out procedure to get him here. I am sure that those of us who heard his maiden speech yesterday know that he will represent the Northern Territory in the way that it ought to be represented.
– You helped him with your electioneeringwork.
– I probably helped Senator Robertson, in some ways, to be elected here. Unfortunately for the people in the Northern Territory, they are not able to listen to rebroadcasts of question time. They are not able to hear a direct broadcast of the proceedings of the Parliament. So, when we have a good speech like that delivered by Senator Robertson yesterday, unless people read the Hansard record they will not know what he said in the Parliament about the people of the Territory. In congratulating other honourable senators on their maiden speeches, I want to refer to the speeches made by the 2 new Government senators from the Territories. I quote what Senator Knight had to say:
I regard it as a great and somewhat daunting honour to enter the national Parliament, particularly the Senate . . .
Of course it is daunting. If his Party had had its way, we would never have had any Territory representation in the Senate. Time and time again when the relevant legislation came before the Senate Liberal and National Country Party senators joined together in voting to knock it out.
– Then he had to buy his way in.
– I will not comment on that.
- Mr President, I rise to order. Senator Cavanagh ought to be made to withdraw the remark that Senator Knight had to buy his way into the Senate. It is a disgraceful and scurrilous remark. A senator of his standing ought to know better. I ask that it be withdrawn without reservation.
- Senator Cavanagh, the remark was in breach of Standing Orders. Please withdraw it.
– It is withdrawn without reservation.
– Thank you. I call Senator McLaren.
– It is marvellous how touchy honourable senators opposite can become when things are said that they do not like. Yet when we were in Government for 3 years we had to suffer all the gibes and comments about illegalities and subversion and about the deceit and duplicity of our Prime Minister. Senator Withers was one who spoke of such matters repeatedly in the Senate, and he grinned all the time he was doing it. Yet, when Senator Cavanagh makes some small remark, Senator Withers takes an objection. That is what we have come to expect from senators of the calibre of Senator Withers. Senator Knight went on to say:
Although my Party-the Liberal Party of Australiaexpressed reservations about the constitutionality of the election of senators for the Territories it has accepted the ruling of the High Court of Australia on this matter.
Of course it has accepted the ruling. If it did not accept it, it would not have fielded candidates from the Territories to be elected to the Senate. The honourable senator also went on to say that the tenure of office should be extended from the life of the House of Representatives, which it now is, to a term of 6 years. It is beyond comprehension that these people whose Party opposed the legislation year in and year out- they took the matter to the High Court and opposed it there- have the gall to say in the Senate now that their tenure of office should be extended to twice what it is now. Senator Knight went on to say:
It is the private sector which, for most people, will ensure the dignity of employment.
It is the private sector which was uppermost in practically every paragraph of the supplementary speech of the Prime Minister (Mr Malcolm Fraser) concerning the election. All he could think of was the private sector. Yet we find Senator Knight coming into the Senate and saying that it is the private sector which for most people will ensure the dignity of employment. Previous to that, he had said:
The Australian Capital Territory is the base of the Commonwealth Public Service. I was a public servant for 1 1 years before entering the Senate. I believe that the Public Service is a highly efficient and capable organisation which serves the needs of the Australian people with great integrity.
We have those 2 statements from Senator Knight. It is recorded on one page of Hansard that he believes it is the private sector which we need to run this country. Then, on the other hand he is recorded on the previous page of the Hansard record as stating that the Public Service is of high integrity. He is trying to have 2 bob each way. I am sure that many public servants in the Australian Capital Territory, had they known what this Government intended to do to them, would not have voted for it at the election on 13 December.
Senator Knight also made this comment:
I am pleased to say that one of the first measures to be introduced into this Parliament will be a new superannuation scheme for Commonwealth public servants.
That matter has a long history. How often did the previous Government introduce such legislation into the Parliament? How often did the Liberal and National Country Parties oppose it and reject it? Now they claim that they have done something wonderful because such legislation is among the first measures they are presenting. But this is what they deprived the Commonwealth employees of for the last 3 years by their continued objection to the legislation. The previous Liberal-National Country Party Government should have updated the Commonwealth employees superannuation scheme 1 5 or 20 years ago. It did nothing about it. Yet, when we tried to do something about it, the then Opposition parties opposed the legislation and rejected it. They now say that it is wonderful that they are introducing the legislation to give public servants some justice.
I want to refer also to some remarks which were made by Senator Kilgariff, one of the Northern Territory senators. I want to say this in fairness to Senator Kilgariff: He appeared before the Joint Committee on the Northern Territory when we were examining the possibility of having a fully elected parliament for the Northern Territory. I asked Senator Kilgariff on more than one occasion for his opinion in relation to Senate representation for the Territory. He told me that in his personal opinion the Territory should have representation. When I asked him why his Party was objecting to it, he could not tell me; but he did say that the National Country Party in the Northern Territory had requested the parent body not to oppose such legislation. When we introduced our legislation for territorial representation, like Senator Kilgariff’s pleas it fell on deaf ears; the then Opposition parties would not acquiesce in what he personally thought should be done. So I say in fairness to the honourable senator that at least he was one member of the National Country Party who stood for Senate representation for the Northern Territory.
– What about Mr Calder?
– Perhaps we had better not raise what Mr Calder did. We know that when he was first elected he campaigned on a policy -
– How did he vote last year?
- Senator Baume attended the Joint Sitting of the Parliament. He would have seen how Mr Calder was forced to cross the floor and to vote for the legislation against his Party. Senator Baume would know very well that he did that with his tongue in his cheek. If Mr Calder, who was then a member of the Parliamentary National Country Party, had had enough pull at his Party meetings, he could have got the National Country Party to vote for that legislation. If the National Country Party senators had supported the then Government, Mr Calder could have achieved what he said he set out to achieve. Mr President, I seek leave to continue my remarks at a later time.
Leave granted; debate adjourned.
Assent to the following Bills reported:
Australian Security Intelligence Organization Bill 1976.
Conciliation and Arbitration Bill 1976.
Senate adjourned at 4.46 p.m.
The following answers to questions upon notice were circulated:
asked the Minister representing the Minister for Defence, upon notice:
What Army and or RAAF exercises were carried out in Victoria on the evening of Thursday, 1 2 February 1 976.
-The Minister for Defence has provided the following answer to the honourable senator’s question:
An Army/RAAF Exercise was conducted in the Bellarine Peninsular area, in Victoria, on the evening of Thursday 12 February 1976. This exercise was conducted in connection with a joint service course specialising in various aspects of interservice co-operation and co-ordination. No other exercises were conducted in the State of Victoria on that night.
asked the Minister representing the Minister for Defence, upon notice:
– The Minister for Defence has provided the following answer to the honourable senator’s question:
Cite as: Australia, Senate, Debates, 4 March 1976, viewed 22 October 2017, <http://historichansard.net/senate/1976/19760304_senate_30_s67/>.