30th Parliament · 1st Session
The PRESIDENT (Senator the Hon. Condor Laucke) took the chair at 2.15 p.m., and read prayers.
– I present the following petition from 498 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:
That the Family Planning Associations throughout Australia contribute to the welfare and well-being of a great proportion of the Australian people both in family planning and in an advisory capacity on the prevention and control of social diseases.
Your petitioners therefore humbly pray that urgent consideration be given to a favourable decision on the continuation of Federal Government finance to enable the activities of the Family Planning Associations to proceed unimpaired throughout Australia.
And your petitioners as in duty bound will ever pray.
Petition received and read.
– I present 2 petitions, identical in wording, from 418 and 348 citizens of Australia, respectively, as follows:
To the Honourable the President and Members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:
That the Family Planning Association and similar organisations throughout Australia contribute to the welfare and well-being of a great proportion of the Australian people both in family planning and in an advisory capacity on the prevention and control of social diseases.
Your petitioners therefore humbly pray that urgent consideration be given to a favourable decision on the continuation of Federal Government finance to enable the activities of the Family Planning Associations and like organisations to proceed unimpaired throughout Australia.
And your petitioners as in duty bound will ever pray.
Petitions received and first petition read.
-I present the following petition from 1 36 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. We, the undersigned citizens of the Commonwealth of Australia by this our humble petition respectfully showeth.
That reduction of the age limit from six years to eighteen months for patients eligible to receive cows’ milk substitutes as a pharmaceutical benefit under the schedules of the National Health Act will cause serious financial hardship to many families;
That the Government’s action is responsible for a severe increase in the cost of cows’ milk substitutes which penalise parents of children aged eighteen months and over who have a medical need for these substitutes.
That there is an urgent, humane need to restore cows’ milk substitutes up to six years of age to the schedule of pharmaceutical benefits.
Your petitioners therefore humbly pray that cows’ milk substitutes be restored to the Schedule of Pharmaceutical Benefits for children up to the age of six years as soon as possible.
And your petitioners as in duty bound will ever pray.
Petition received and read.
-I present the following petition from 18 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that many Australians are concerned at the announced decision by the Australian Government to reduce the 1975-76 Overseas Development Assistance vote by $2 lm, and by the abolition of the Australian Development Assistance Agency.
We your petitioners do therefore humbly pray that the Australian Government:
as a matter of urgency, reverse the decision to cut the 1975-76 Overseas Development Assistance vote, so as to ensure that the full amount appropriated by Parliament for Overseas Development Assistance is spent this financial year to meet the pressing needs of those in the developing countries;
reaffirm Australia’s commitment of Overseas Development Assistance being a minimum of 0.7 per cent of GNP, and
establish a fully independent statutory authority to administer Australia’s official Overseas Development Assistance.
And your petitioners as in duty bound will ever pray.
Petition received and read.
– I present the following petition from 62 citizens of Australia:
To the Honourable the President and Members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:
That the Family Planning Association and similar organisations throughout Australia contribute to the welfare and well-being of a great proportion of the Australian people both in family planning and in an advisory capacity on the prevention and control of social diseases.
Your Petitioners therefore humbly pray that the Senate, in Parliament assembled, give urgent consideration to a favourable decision on the continuation of Federal Government finance to enable the activities of the Family Planning Associations and like organisations to proceed unimpaired throughout Australia.
And your petitioners as in duty bound will ever pray.
Petition received and read.
– I present the following petition from 366 citizens of Australia:
We the undersigned, who are all in the employment of Martin Wells, and are fully aware of the Industries Assistance Commission Report on the Spectacle Frame Industry, deplore their attitude they have taken and their recommendations to the Government, to cease quota restrictions on spectacle frames, sunglasses and sunglass frames, and of the lowering of tariff rates on spectacle frames to 25 per cent.
We have been advised by the Management that if this report of the I.A.C. is accepted by the Government then the Company of Martin Wells would have no alternative other than to sack 400 employees.
The Government is well aware that unemployment is very high. If they accept this report, the Government would be directly contributing to another 400 people being put on the unemployment list.
The very important point that must be brought to the attention of the Government is that 80 per cent of the employees at Martin Wells, live within a 10 mile radius of the factory.
To find other employment in the area would be virtually impossible. Factories in this area, like Martin Wells, do not have a great turnover in staff. It should be noted that the housing population in this area is high due to the fact that Mr Druitt Housing Commission is adjacent to the industrial area. All factories in this area must be kept going to be in the best interest of the people and avoid serious social problems of mass unemployment.
We feel that it would be in the interest of the Government to note that employees have many years service with this Company, and have obtained a high degree of skill in the manufacture of spectacle frames, which has led to this Company gaining world-wide recognition.
We feel that adoption of the I.A.C. Report would lead to lower standards, conflicting with health requirements and that the higher influx of imported frames would only lead to a higher degree of inflation and a further ‘rip off’ to the Australian public.
We deplore the report of the Industries Assistance Commission which will end the operation of the last Australian Manufacturer in the industry.
And your petitioners as in duty bound will ever pray.
As the petition exceeds 250 words in length, in compliance with sessional orders I shall not ask for it to be read.
-I ask the Minister for Social Security: Has a committee been set up by the Government to review the programs for the care of the aged? Do members of the committee include, among others, Dr Sidney Sax, and Mr Austin Holmes who was recently on the Medibank Review Committee? If so, what are the committee’s terms of reference? Why has there been no public announcement on the formation of this committee? Who, if anyone, will be asked to make submissions to the committee during its investigations? Will the findings of the committee be reported to the Parliament?
– It has been decided to set up a committee to look at the matter of care of the aged, and in particular to look at accommodation in nursing homes, and in aged persons homes and hostels. I assume that, in conjunction with the Minister for Health, a statement could be made outlining the work the committee will do. I can assure the honourable senator that any report the committee may make will be a matter for future discussion by the Parliament and by all those who are concerned with the manner in which housing, hospital and nursing accommodation for the aged is developing at the present time.
-My question is directed to the Minister representing the Treasurer. What consideration has been given to paying the investment allowance on wages to employees as opposed to the investment allowance on the purchase of manufactured items? Is not such a proposal operating with great success in Germany? Would not a deduction for wages in excess of that paid out induce employers to put on more staff and so reduce the drain on the Government by way of unemployment benefits?
– This is an extremely involved and complex matter. The reference to what is happening in West Germany is rather bluntly drawn. The matter is much more finely to be defined than that. The simple facts of life are that this is an alternative arrangement as far as revenue and deductions from revenue for taxation purposes are concerned. It is not an easy matter on which to give an off the cuff answer in the Senate. I happen to know a little about the alternative method of doing these things. I have some reservations about whether the West German method is as stated or as effective as it might be thought to be. It is an area of straight alternatives in which one way of doing things is to be contrasted with another way of doing things. I think the honourable senator will appreciate that this is an area where we ought to ask for a very specific definition from the Treasury, and I shall do that.
– I preface my question to the Minister for Education by reminding him that during the election campaign the LiberalNational Country Parties, as part of their promises to the people of the Northern Territory, said that there would be no expenditure cuts in education. Is it true that the Sadadeen High School at Alice Springs will not be built for three of four years? If that is true, will the Minister undertake to secure moneys for the immediate construction of this very important and very badly needed high school?
– No firm decision with regard to the specifics of the overall expenditure for education in the Northern Territory, school by school, has been reached as yet. Therefore I cannot answer the honourable sentaor on that matter. My Department and I are striving very hard indeed to ensure that there will be a sufficiency of money to meet the programs needed to bring on the schools, including the school he mentioned. As soon as it is possible, I will make available the program for school building, including that school.
– My question is directed to the Minister for Social Security. By way of preface, I remind the Minister that last Friday she made public the intention of the Government to give $5m in 1976-77 for the continuation of the Australian Assistance Plan. Are these cash grants the only continuing support planned for the Australian Assistance Plan? If other support is planned, what are the extra provisions being made by the Government to assist the continuation of the Australian Assistance Plan and the involvement of citizens in their own communities?
– I answered a question yesterday with regard to the Australian Assistance Plan and I spoke of the cash grants which were to be made for the salaries of those people presently employed and of the $2m to continue the projects which are incomplete at this stage. I make it clear that in addition to these measures the Government has agreed with the States that officers of my Department will be available during the transition period of one year to assist the transfer of this plan to the States. At the conclusion of that year there will still be officers of my Department in each State willing and able to assist the States in the further development of the plan if they so desire.
As well as speaking of the funding for this year, I think it should be made perfectly clear that when the States and the Federal Government meet to discuss financial arrangements, a number of items will be transferred for absorption by the States, and the Australian Assistance
Plan is one of those items. Consistent with our federalism policy an arrangement will be made financially for the absorption of these programs. The Australian Assistance Plan will be listed amongst those which will be absorbed by the States, and the financial agreement will take that into account at that time.
– I direct my attention to Senator Withers in his capacity as Leader of the Government in the Senate and as Minister representing the Attorney-General. 1 remind the Senate that I testified before the inquiry into all aspects of security chaired by Mr Justice Hope and gave specific and documented evidence and suggestions to overcome certain Australian citizenship application injustices. In view of the periodical reports that are coming out from Mr Justice Hope, according to the Press, can the Leader of the Government indicate whether this vexed question of a better appeal system on rejected citizenship applications has been finalised?
-As the honourable senator would know, Mr Justice Hope is reporting direct to the Prime Minister on this subject. Therefore, I will pass the question on to the Prime Minister and seek an answer for the honourable senator.
– I direct my question to the Minister representing the Treasurer. I draw the Minister’s attention to a provision of the new 40 per cent investment allowance which states:
In the case of plant leased through a bank or finance company for a minimum period of 4 years, the allowance confers a lump sum deducted in the year in which the plant is first used or installed ready for use by the lessee that is based on the full cost of the plant to the lessor.
Is the Minister aware that leasing arrangements have been entered into for a period of less than 4 years since January this year in the expectation of qualification for the 40 per cent tax deduction? Will the Minister comment on the eligibility for the allowance of those who have made these arrangements?
– Many of us, including honourable senators, have been directing their attention to this question of the investment allowance as it applies to leased equipment. The question is appropriate and I have some information on it. One of the conditions for the granting of the investment allowance in respect of leased plant is that the plant is to be leased for a minimum period of 4 years. However, the
Government took into account the possibility that some taxpayers may have entered into shorter lease agreements after 1 January and before all the details of the legislation were known. Accordingly the proposed legislation contains transitional provisions to meet this situation. Where a taxpayer has entered into a lease arrangement with a bank or finance company for less than 4 years in respect of plant which is eligible the investment allowance will be available in respect of plant if the lease is renegotiated to extend the term to 4 years. I think that ought to cover the problem.
– Will the Minister for Social Security inform the Senate of the numbers of persons who have been taken off unemployment benefits and placed in receipt of other social security benefits such as sickness or invalid pensions? Is the Minister aware that this new practice causes psychological harm to those physically weaker members of the community who hitherto have displayed great courage and determination to overcome their disabilities? Can the Minister inform the Senate of the reasons behind the reallocation of such people?
-I am unable to state the number of persons who may have been taken off unemployment benefits and placed in another category. I remind the honourable senator that those people who seek sickness and invalid pensions have to meet qualifications and provisions before they are eligible to receive these benefits. I will obtain any information which will assist the honourable senator about numbers which may have been transferred from one benefit to another. I agree with him that a person who is placed on a sickness benefit or an invalidity benefit could be psychologically harmed if this were not the reason for his receiving such benefit. The provisions of the Act which relate to sickness and invalidity pensions, I think, are those which comprehend invalidity. I doubt very much that any transfer has been made for any reason other than to meet those provisions, but I will obtain any information that I can on numbers to assist the honourable senator.
– My question is directed to the Minister representing the Treasurer. I refer to an allegation which has had considerable publicity and which, I think, has been adopted by Mr Hawke, amongst others, that as a result of the economic package presented by Senator Cotton to the Senate last Thursday night about 57 per cent of taxpayers will be worse off. Is there any truth in that allegation? If there is not, can the Minister account for how it has been made?
-First of all, there is no truth in the allegation. How it has been made is, of course, a matter either of ignorance or of prejudice, things to which we are not unaccustomed in the parliamentary scene.
-What is the truth?
– For the sake of those who are interested in this matter rather than the subject of noise, and for those who like to have the truth rather than distortion, I have had Treasury produce for me the detailed figures that the Treasurer has had available to him. The document is 8 pages of fine print figures. I do not think there is much wisdom incorporating it in Hansard. I think I will have it copied and circulated to honourable senators. It discloses that nobody is worse off. It discloses that a taxpayer on a very low scale of income without dependants gets practically no benefit, but a taxpayer on a low scale of income with 6 children receives the maximum benefit. Honourable senators may draw their own moral conclusions from that observation.
– I ask a question of the Minister representing the Minister for Primary Industry. Was it by order of the Minister for Primary Industry that a number of soldier settlers after many years settlement and land clearing on Kangaroo Island have been told that they must vacate their properties? If the answer is in the affirmative, will the Minister withdraw the order and discuss with the settlers concerned other programs that will permit them to stay on their properties, perhaps under the unemployment relief scheme recently extended to some farmers?
– I am not aware of the circumstances to which the honourable senator referred. I know Kangaroo Island. I know it has been the subject of soldier settlement programs. If the honourable senator could give me details of the problem, in particular the names of people, I will see that the matter is raised with the Minister for Primary Industry. I am a little concerned at what I heard. If the honourable senator has anything which would aid me 1 would be grateful if he gave it to me after question time, and I will send it forward.
-Has the Minister assisting the Prime Minister in Federal Affairs noticed the outburst from the Premier of Tasmania that indexed taxation would mean reduced money for the States? Seeing the Premier welcomed the new federalism policy just a short while ago, does the Minister think that the Premier is now trying to backtrack and join the New South Wales bandwagon on the double taxation scare campaign, as an election is due in our State shortly?
– I did have my attention directed to a statement purporting to be a statement by the Premier of Tasmania in which he appealed for a federalist approach to solve the problems of this matter. He said that tax indexation was a bluff. I inform the Senate that Mr Neilson was present at the last Premiers Conference, as I was. At the Premiers Conference the Prime Minister was utterly frank about the intentions of the Government regarding tax indexation. He foreshadowed that there would be even total tax indexation. He foreshadowed, and in fact discussed, figures that showed the difference between the 2 schemes and gave the guarantee that what the States would yield would not fall below the previous formula. This was accepted unconditionally by Mr Neilson. He was a party to the situation which he now regards as a fraud.
– But what did he say outside?
– Since the honourable senator asks about that, let me state what he really said. He is reported to have said:
If Tasmania does not get a reasonable deal to continue programs like pre-schools and TB prevention we will have to take action to persuade a majority in the Senate to do something about it.
He appealed for federalism in this regard. The simple fact of the matter is that the guarantee to Tasmania, as with the other States, is that it can receive no less than it received under the previous Whitlam Government and prospectively it will receive considerably more.
-I direct a question to Senator Carrick in his capacity as Minister Assisting the Prime Minister in Federal Affairs. Is it not a fact that the quotation in the question just directed to him was taken out of context in the total statement made by Mr Neilson and that Mr Neilson ‘s concern is in regard to the total effect on Tasmania of the policies as they are now beginning to be revealed? If he can give the undertaking he has just given, why did not he give the same undertaking yesterday when I specifically asked him whether there would be a guarantee in regard to the 58 per cent increase which he said he would give? I point out that Senator Walsh asked a question in the Senate on this matter some months ago and the Minister said that he could not give that guarantee until such time as he had studied the figures. If he has studied the figures, will he produce them and table them in the Senate?
-I think that Senator Wriedt asks about 3 questions. Firstly, he asked whether the statement by Mr Neilson was taken out of context. If the newspaper report is correct, it is not taken out of context. I invite the honourable senator to look at the newspaper report. Mr Neilson is quoted as saying
So far as State governments are concerned, tax indexation is a confidence trick. It would mean that the State share of income tax would not be as high as it would otherwise have been.
I replied frankly to him on that matter. To relate the question asked yesterday by Senator Wriedt to the question and answer today is to invite an answer on 2 entirely different subjects. I was replying today in relation to the Commonwealth reimbursement on untied grants and the substitution revenue-sharing for it. That, indeed, is what happened at the Premiers Conference. I said that I could not give an answer on what the total impact of the tied grants and untied grants would be because there were still some under review.
– That is what Mr Neilson is talking about.
-Senator Wriedt interjects and says: ‘That is what Mr Neilson is talking about’. Mr Neilson is talking about tax indexation being a bluff. I repeat that at the Premiers Conference Mr Neilson unconditionally agreed to what the Commonwealth said would happen in terms of tax indexation.
– My question which is directed to the Leader of the Government in the Senate, relates to the proposed royal visit to Australia in 1977. Can he say whether the Queen’s itinerary is known to the Government? If so, can he say whether the South Australian Government has extended an invitation to the Queen to visit that State and whether she has expressed a wish to visit?
-The itinerary is under the control of the Prime Minister. I think that it would be only proper for me to seek from the Prime Minister an answer to those 2 questions.
-I direct a question to the Leader of the Government in the Senate who represents the Prime Minister. By way of preface, I remind the Minister that in the election held last weekend in Tasmania the Australian Labor Party candidate, being opposed by a previous Liberal Party Minister and a previous Liberal Party senator, obtained 57 per cent of the vote. That follows closely on the Labor Party victory in New South Wales, and is an indication of the Government’s declining position. Despite the answer that was given yesterday, I ask the Leader of the Government in the Senate what the Government proposes to do to assist Tasmania to alleviate the plight which Tasmania inevitably will face because of the possibility of hospital fees for maternity patients costing up to $500. Despite the reply given yesterday to the question about the possibility of people in Tasmania paying up to $1,000 a year for medical and hospital benefit insurance, I ask the Leader of the Government in the Senate: Will the Prime Minister consider placing a moratorium on the new health and medical proposals pending a referendum of the people to test whether the Government has a specific mandate to wreck the Medibank concept?
-I suppose that Medibank was talked about in this country for a number of years. I suppose it is fair to say that the pledge to introduce Medibank, amongst a number of pledges, was one of the reasons why the Australian Labor Party was elected to government in 1972. After 18 months the Labor Party just scraped back into government but it could not get control of the Senate. Then, 18 months after that, when Medibank was in full flower, the Labor Party was thrown out of office by the largest vote which we have ever obtained in the history of this nation. In fact, 58 per cent of the people could not abide the Labor Party. I think that the members of the Labor Party raised the question of Medibank during the last election campaign- or were they too busy worrying about the past and not about the present? Turning to what happened in last Saturday’s Tasmanian election, the honourable senator did not say that although the seat was won by the Labor Party it was a seat which previously had been held by the Labor Party. The honourable senator might have given all the information instead of just giving half the information.
– It would make the question too long.
-I thought that Senator O ‘Byrne could not make the question much longer. I thought it was more in the nature of a speech than a question. In regard to the nonsense that the honourable senator keeps trotting out about hospital and medical benefit insurance costing people in Tasmania $1,000 a year, the honourable senator has been here a long time and if he believes that sort of nonsense and wants to trot it out at question time I suggest there ought to be a moratorium on his stay in this Senate.
– My question is directed to the Minister representing the Minister for Post and Telecommunications. I refer to the provision of a television service to Leigh Creek in South Australia, which is a matter of interest to honourable senators on both sides of this chamber.
- Senator McLaren has referred to that.
-I was about to refer to that. Last night Senator McLaren raised this matter and suggested that this project could have been delayed or shelved. Is the Minister aware that the Department of Post and Telecommunications recently informed the honourable member for Wakefield, the Hon. C. R. Kelly, that a clearance for this installation was given by the Australian Broadcasting Control Board a few weeks ago and that transmitting facilities are expected to be established by June next year?
– I dealt with this in my speech last night as you will see if you read it.
-I am trying to elaborate for the benefit of the honourable senator. Can the Minister say whether this is the present situation? If not, will he ask his colleague in another place to confirm this information or inform the Senate whether there is any change in the anticipated date of completion?
-I understand that the information conveyed to the honourable member for Wakefield in another place, Mr Kelly, as outlined by Senator Jessop, is as stated. Last night I provided information to Senator McLaren who had asked me- I speak from memory- whether it was a fact that a contract for a translator at Leigh Creek had been cancelled and, if so, the date on which it had been cancelled. I think that was correct. I think I replied by saying that no such cancellation had occurred. My understanding of the situation is that the ordinary procedures are being followed, but in case there should be any further information for Senator Jessop I will seek it out.
-Can the Minister for Social Security tell me whether the Income Security Review Committee is still meeting? Will it be assessing the changes on family income structure following the recent announcement by the Government, and the disabilities suffered by those families whose incomes have been diminished as a result of the Medibank levy and health fund payments, the removal of tax deductions on mortgage loans, probable cost increases arising from the slashing of Government programs and foreshadowed indirect taxation?
– The Income Security Review Committee is a continuing committee of officials. It is presently looking at all matters that relate to benefits and pensions through my Department. We do refer to it from time to time specific areas where we require it to do work so that we can look at future policy. I will draw to the attention of the Income Security Review Committee the matters which have been mentioned by the honourable senator. They would be comprehended within its work as this is precisely what this Committee is doing. It is looking at all matters that relate to family income and to the benefits that are applicable from my Department.
– I ask my question of the Minister representing the Minister for Overseas Trade. Does the Minister agree that for Australian industry to reach optimum production levels and thereby reduce unemployment a significant level of exports must be achieved? If he does agree with this broad statement, is he concerned that the recent Government decision to restrict export incentives may hamper Australian economic recovery? Is the Minister considering the introduction of new export incentives which will enable Australian products not only to find new markets but also more effectively to compete in our current export markets?
-It is undoubtedly true that exports in the Australian manufacturing industry mean a great deal to the stability and employment capacity of that industry. It is equally true that there was a period in Australiait was approximately 1974- when due to balance of payments surpluses which were the product of earlier years of endeavour and investment such a surplus was produced that the official view then as pronounced in Treasury bulletins was that we no longer needed to bother about this aspect and, therefore, goods manufactured for export were less important. I thought at the time that there was a fallacy in that view. At present, the whole matter is under study. The export incentives as they were seemed to be constructed on the basis that they did not really achieve the result, dollar for dollar. The important thing about incentive programs is that what they really do is produce an incentive which leads to a result. The matter is under study as the honourable senator suggests.
– I direct my question to the Minister for Social Security. Will the Government index the supplementary income limit at which her Department issues pensioners medical cards and travel concession cards? I understand that currently it is $33 a week for a single person and $57 a week for a married couple.
-There is no announcement imminent that would relate to indexation of supplementary income limits which were specified by the honourable senator in his question. Any matters that from time to time would be subject to review would be announced as appropriate. No other matters are imminent for announcement at present. Any further review of income supplements or free income would be a matter of Budget consideration if announcements were to be made some time in the future.
– I address my question to the Minister representing the Minister for Health. As the practice of chiropractics is being more and more recognised and used by the general public, will the Government give serious consideration to the compulsory registration of chiropractors so that only those fully qualified to standards will be recognised and allowed to practice? If so, will the Minister have discussions with State Ministers for Health on this matter?
– I will refer the matter of chiropractic registration to the Minister for Health. As has been suggested in the question, it would be a matter also of discussion with State Health Ministers. I will see that this is brought to the Minister’s attention.
– My question is directed to the Minister representing the Treasurer. Is it a fact that under the new tax indexation and
Medibank levy proposals a family of three with a total income of $450 a week will be $6 a week better off as opposed to a similar family whose total income is $120 a week and gains less than $ 1 a week extra as a result of the changes? Will the Minister concede, therefore, that the introduction of tax indexation and the Medibank levy has been designed to ensure that most benefit flows to those on the highest incomes?
-I suggest that the honourable senator and all of us might benefit from the study of 8 pages of fine printed figures when I have them copied and circulated. They contain all these details and all the comparisons. They are from the Treasury and the Australian Taxation Office and when we get them we can detect the difference between fact and fiction. What comes through clearly from the figures is that those people with large families receive a distinct benefit. I commend that thought to honourable senators.
-My question is directed to the Minister representing the Minister for Post and Telecommunications and refers to the most unfortunate and unnecessary incident on television last night involving the Governorelect of South Australia. Can the Minister say whether there are any standards of courtesy and good taste laid down for those people who interview the representatives of Her Majesty in this country and those people who make decisions about the screening of such interviews? If not, will he refer the matter to the Minister for Post and Telecommunications and the Australian Broadcasting Control Board for inquiry and recommendation? Will the Minister make representations to the appropriate association of television stations to ensure that Her Majesty’s representatives are not submitted to this kind of interview in the future?
– I did not see the program but I heard on the radio this morning certain statements regarding it. Let me say at once that all honourable senators would like to congratulate the Governor-elect upon his appointment. He is a very distinguished Australian. He stands high with all Australians and he will walk with merit amongst us. I have not seen a report and therefore I cannot adjudicate on what happened. Senator Davidson asked what kind of rules there are. The Australian Broadcasting Control Board, as he may know, attempts to lay down standards but, as he also will know from his committee experience, the question of trying to define standards of good taste is a very difficult one because those standards may change with the public as the years roll along. Nevertheless, the real test of good taste must lie with the viewing public at all times and their capacity to turn off the station or to protest. I understand that there was widespread protest last night and I say that without in any way attempting to adjudicate on what happened.
There will always be times, sadly enough, when some interview will appear to be either brash or in bad taste. Every public figure has had that experience and I can only regret that it occurs. However, I am sure that the real arbiters, the real judges, should be the people of Australia. If the Governor-elect has experienced any unfortunate circumstance he will know that the people of Australia regret it. I do not think that there need be any more or higher standards of good taste applying to interviews of Her Majesty’s representatives than to interviews of any other citizen on television or radio. In other words, good taste lies in the hands of the media. It is a nice judgment of the freedom of the media how it exercises that good taste. On the whole I think it does so. If there was an aberration last night we all regret it and I hope we will all learn from it.
-I ask the Minister for Social Security: Is it a fact that she announced in Darwin that the Social Policy Planning Units would cease to receive Commonwealth funding in 4 weeks’ time? Why was this program, costing only a modest amount, not phased out over a year as is the Australian Assistance Plan, allowing staff a reasonable time to wind down operations and to find suitable employment rather than pushing them out at such short notice?
– The question indicates that the honourable senator misunderstands the Social Policy Planning Units which did exist as a pilot scheme with Federal Government funding. These Social Policy Planning Units are established within State governments and it appears appropriate to us that State governments should continue them, if they wish to do so, within their own area. The matter of phasing the Units in or phasing them out was not a matter for consideration in the same way as was the Australian Assistance Plan, but in accordance with our federalism policy the Social Policy Planning Units may also be an item that will be listed for absorption by State governments when we discuss the financial arrangements for the forthcoming year.
– I should like to ask a question of the Leader of the Government in the Senate which follows a question asked a minute or two ago by Senator 0 ‘Byrne. Is the Minister able to say whether the indication that the Labor Party had done well in the Hobart seat for the Legislative Council, as intimated by Senator 0 ‘Byrne, is accurate or simply shows that the honourable senator does not understand figures? Is it a fact that actually there was quite a large drop in the Labor vote in the seat compared with 6 years ago, which I think most people would take as an indication of the present support of the Liberal Party in Tasmania?
-They are fighting like Kilkenny cats.
-I suppose that the honourable senator who just interjected about fighting like Kilkenny cats would know all about how political parties fight like that, because members of the Party which he has represented in this Parliament for a long time have been quite notorious for fighting like Kilkenny cats. I suppose their tragedy at the moment is that members of the honourable senator’s Party do not have any fight in them at all. They were so done on 13 December last that I suppose they are like a lot of Manx cats- they have had their tails cut off and do not know what to do with themselves. Adverting to the Tasmanian election, I understand that Mr Mather, a Liberal member of the House of Assembly in Hobart, is reported to have said on 26 May that:
The report quoted Mr Mather as having saidand I take his figures to be correct:
The glaring fact which Mr Neilson overlooks is that the Australian Labor Party vote on Saturday was a drop of 36 per cent on its vote when the seat was last contested six years ago.
So there was a 36 per cent drop in 6 years. Mr Mather was further reported to have said:
Even taking account of the big number of candidates and the change in Legislative Council franchise, there had been a major drop in Australian Labor Party support.
I suppose that all politicians can get all sorts of things out of all sorts of figures but the simple fact is that if Mr Neilson feels so confident that support is running so strongly in his favour the best thing he can do is to take the Assembly to an election, which we in the Liberal Party would welcome.
-May I break through our isolationism for a moment and ask the Minister representing the Minister for Foreign Affairs to give an explanation to the Senate of the delay in Australia s response to the recent urgent request of the Secretary-General of the Commonwealth for financial or technical assistance to Mozambique to assist that Commonwealth country with the economic consequences of closing its border with Rhodesia? In view of the statement of the Secretary-General earlier this week in Canberra that he would be surprised and disappointed if Australia did not contribute to special technical assistance programs for Mozambique, can the Minister say whether Australia has yet responded to the request from the Commonwealth fund for technical assistance and co-operation?
-I think that that is a matter on which the Government will make an announcement when it has made its decision. It is not for me in this place to announce what may or may not be a Government decision.
-Has the Minister for Social Security noticed an article in a Sydney newspaper alleging that social service benefits were not paid to the family of Mr Frank Mialo of Minto, whose wife Gwen is dying of cancer? Is the newspaper report correct when it alleges that benefits properly due to this tragic family have been or are being withheld? Will the Minister please instruct her Department to arrange for an immediate payment of the benefits to allay the sad situation of this family? Finally, is the Mialo family in receipt of all proper benefits? Are plans in hand to see that its position is reviewed should events alter?
– I am aware of the tragic situation of the Mialo family as mentioned in one of the Sydney newspapers today. I made inquiries about the family to determine how we would be able to assist it and found that Mrs Mialo was granted an invalid pension from 1 April this year at the rate of $67.90 per fortnight. This was the reduced rate because at that time her husband was earning. On the basis of her husband no longer having any income, Mrs Mialo’s invalid pension will increase to $113.50 from the time that her husband stopped work on 13 May this year. Mr Mialo lodged his application for special benefit with the Department on Wednesday, 19 May. A social worker from the Department visited Mr Mialo on Monday, 24
May to offer any assistance he could to the family. In the meantime, a special benefit was approved for Mr Mialo at the rate of $68.50 per fortnight, payable from 20 May. Arrangements have been made for Mr Mialo’s cheque to be delivered to him personally this afternoon by a departmental officer. This means that as from 20 May the Mialo family will be eligible to receive $182 per fortnight from the Department of Social security. I do not like having to make personal details of any family as public as this but I believe that the treatment of the article in the newspaper suggested that benefits were being withheld or not being granted to the family concerned. I think we all share the concern of those who printed such a matter because of the difficulties which this family is experiencing. I assure the senator that my Department is aware of the situation and is giving whatever support it can to the family.
– My question which is directed to the Minister for Social Security relates to the new child endowment provisions. Can the Minister inform the Senate whether these provisions which are not taxable will be counted as income for the purpose of determining eligibility for the supporting mothers benefit or for the National Employment and Training scheme allowance? If they will be, has the Minister yet been able to calculate whether this will lead to cases where women in receipt of child endowment will actually lose a supporting mothers benefit or the training allowance currently being paid?
– The new family allowances are not taxable nor are they taken into account for the purposes which have been mentioned by the honourable senator. If there is any specific detail which she may require I shall enable that to be given to her. These payments are not taxable, nor do they affect the matters which she has mentioned.
– I direct the attention of the Minister representing the Minister for Primary Industry to the fact that following the recent shooting and burial of several hundred head of dairy cattle in Victoria there has been a violent upturn in the auction ..ale price of chopper cows in the various markets throughout the State. In fact, cattle which previously could not be sold for more than $2 a head are commanding prices of $20 and upwards. In view of the uncertainty in the market which was in evidence even prior to the events mentioned, will the Minister give consideration to having an investigation made to see whether any action can be taken to restore and maintain stability in the market?
– Not only has the honourable senator directed his attention to this matter but also Senator Primmer spoke about it, I think last week. I was rather astonished by this upturn in the market for chopper cows. It seemed to me that either there was a market or there was not a market, and if the problem of the drought was as great as people were led to believe then this episode would have seemed, in commercial terms, not likely to have lifted the market. It seems to me, therefore, that there is some case for a fairly detailed examination of this whole matter. I have previously directed the concern of the Senate on this matter to the attention of the Minister for Primary Industry. Also I have written a letter to the Minister for Science, which probably he has not received yet, asking whether anything can be done in the scientific world about converting some of these at the moment useless cattle into some form of dried meat which may be able to be exported. I know that all honourable senators have a concern about this matter, and I share that concern. It has always seemed to me to be something we ought to be able to resolve.
– My question is directed to the Minister representing the Minister for Primary Industry. In view of the statement made yesterday in Leongatha by the Minister for Transport, Mr Nixon, that there will be financial assistance for emergencies- I remind the Minister that Mr Nixon was speaking in relation to the dairy industry- can the Minister indicate when the dairy industry is likely to know how much assistance it will get and when it will be received?
-I am unable to give the honourable senator a precise answer. I think that these are circumstances which call for me to get precise information from the responsible Minister, and I shall seek it.
-I thank the honourable senator for that information which I will have great pleasure in passing on to my colleague so that when a decision is to be made he will be aware of all the facts.
-Has the attention of the Minister for Education been drawn to comments by the Vice Chancellor of the University of Queensland, Sir Zelman Cowen, published in the Courier-Mail last Saturday, 22 May, that universities will be in a more uncertain position as a result of changes to the triennial funding system? Does the Minister agree with the Vice Chancellor that the changes indicated in the Treasurer’s statement to the Parliament last Thursday night, that is, the provision of only indicative figures for the latter years of the triennium, will deny universities the capacity to plan ahead by knowing that stated sums are available? In the light of Sir Zelman Cowen ‘s statement, will the Minister agree to an urgent meeting between himself and the Vice Chancellors of all Australian universities to discuss the future of university education in Australia before the changes announced by the Treasurer are put into effect?
– I have not seen the statement that Senator Colston said is attributed to Sir Zelman Cowen. I am in contact with him fairly frequently. Indeed, I had a telephone conversation with him in recent days. I am also in continuous contact with all the Vice Chancellors and I attended a meeting of the Vice Chancellors ‘ Committee in recent weeks. As I have said, I am frequently in contact with them. If such is the substance of the statement, then I can say only that it would not show a full understanding of what triennial funding is intended to be. First of all, I remind the Senate that the previous Government abolished triennial funding for this year, and in fact there was no triennial funding. This Government, in a time of tremendous difficulties of inherited inflation, has reintroduced triennial funding and has done 2 things within it. It has given not only guidelines as such but also minimum guarantees of increased growth for the next 3 years. This is something that the previous Whitlam Government never did, and presumably was never able to do. In other words we have given a guarantee that the funding will not fall below its present rate and that there will be a minimum growth of 2 per cent over the next 3 years. If the nation grows in capacity and productivity in that time we may be able to increase the growth capacity. The fact is that the universities, at a time of straitened circumstance in Australia, are being given reasonable guidelines for planning. They can plan ahead with a modest guarantee of minimum growth. The have a guarantee for the 3 years ahead. They had no such guarantee under the previous Government. Nevertheless, within those guidelines the growth of universities in the years immediately ahead will necessarily be modest.
– I direct my question to the Minister for Social Security and refer to recent Press reports suggesting that the Government might plan to reduce spending on child care services next year by $5.8m. I ask: Will the Government in fact reduce financial support for child care services in 1976-77 compared with the current financial year? Will action be taken, in accordance with the Government’s intention to improve services to the most needy in the community, to meet this criterion with respect to child care services? Can the Minister indicate when the necessary administrative arrangements might be announced?
– I noticed Press reports of a reduction of some $5.8m in the child care program. The reduction concerns a comparison made between what were forward estimates submitted by the department and what had actually been approved for funding this year. Some $227,000 was spent on child care in the year 1972-73; the following year $8.6m was spent; in 1974-75 $44.86m was spent; and in 1975-76 $63.29m will be spent. It is anticipated that $73.3m will be spent next year. In comparison with the actual expenditure and allocation of this year there has not been a reduction of $5.8m. That figure refers to the forward estimates that had been submitted by the department. A review of those resulted in the allocation of $73.3m for this year.
Another part of the honourable senator’s question referred to priorities. Need has been taken into account by the Government. The Prime Minister has already announced that funding for child care services this year will be given a priority because of the very urgent need in most parts of Australia for these support services for families and children. Administrative arrangements come within the portfolio of the Prime Minister. He would make any statement on future administrative arrangements. I cannot anticipate when any announcement will be made.
– I direct my question to the Leader of the Government in the Senate, either in his capacity as Minister representing the Prime Minister or Minister representing the AttorneyGeneral. I am not sure of the administrative arrangements within those portfolios. I ask: has any inquiry been made into newspaper and radio reports of recent days on the matter of the Australian Security Intelligence Organisation’s recruiting and using a young female student in Adelaide to spy, inform and pimp on her fellow students? If no inquiries have been initiated, will the Minister have an investigation carried out to ascertain whether the Press and radio reports are correct? If the reports are confirmed, will the Government consider having this unsavoury practice stopped immediately?
-I noticed that in reply to a question in the House of Representatives the other day the Attorney-General said that he was adopting the view which Mr Chifley, who set up the Australian Security Intelligence Organisation, first put forward and which has been followed by every Minister since; that is, no questions in this area will be answered.
-My question is directed to you, Mr President. I refer to a question that was asked yesterday by Senator Archer, and answered by Senator Carrick, as a result of which my colleague, Senator Grimes, at the conclusion of question time, sought leave and was permitted to make a personal explanation. Are you aware that a report of the Joint Committee on the Broadcasting of Parliamentary Proceedings, which was adopted some years ago by both Houses, includes a provision that if a member makes a personal explanation in rebuttal of any misrepresentation contained in a question asked that day or an answer thereto, the question and answer shall, subject to the exercise of a certain discretionary power vested in you, be excluded from the parliamentary rebroadcast? Was action taken yesterday to expunge the question and answer from the rebroadcast, in accordance with that provision?
– Yes, I am aware of the reference on page 464 of Australian Senate Practice, which covers the situation to which the honourable senator referred. As I indicated yesterday when this matter was raised, the rebroadcast of questions and answers is processed in accordance with the principles recommended by the Joint Committee on the Broadcasting of Parliamentary Proceedings which were adopted by both Houses. These principles are as stated by Senator Douglas McClelland. Exercising my discretion, I excluded the question and answer from the rebroadcast yesterday.
– I direct a question to the Minister representing the Minister for Construction. What steps, if any, has the Government taken to compensate private contractors and their employees who have suddenly found themselves without work because of the Government’s severe cutback in expenditure on capital works?
– I do not recall whether the honourable senator stated the area to which his question referred. Is he speaking of the Northern Territory?
– I am speaking of the overall position.
– If he is speaking of the overall position, it is obvious that at present the Government would have taken no action in relation to the 2 questions which the honourable senator specifically raised.
-I direct to the Minister for Science a question not entirely without noticewith a little notice perhaps. It relates to meteorological reporting and actual weather reporting. What was the response to the Minister’s invitation to interested persons and groups to make submissions to him on the subject of the cutback, and curtailment in some instances, of actual weather reports by the Australian Broadcasting Commission? As a consequence of that invitation, has he received sufficient information from these people to enable him to reconsider the proposal to reduce these services? What other conclusions has he been able to reach as a result of the information which has been supplied to him?
– As the Minister responsible for the Bureau of Meteorology, on assuming office I took action to bring economies to that division of the Department of Science. The Bureau of Meteorology is a very important- indeed, an essential- service for this nation. Weather predictions, weather reports and the dissemination of those reports, to which the honourable senator referred, are quite costly to the community. This coming year the expense will be in the vicinity of $33m. I acknowledge the special interest that Tasmanians have in this matter. In the last few months the very special considerations that need to be given to Tasmanians and to the industries in that State have been impressed on me. They certainly require adequate weather information for the conduct of their businesses. To date my office has received approximately 98 responses. While that number appears low, I should say to the honourable senator that the letters in general represent the opinions of a great many people. Indeed, they have been from government instrumentalities such as forest commissions, civil air groups, fishing co-operatives, mining groups, shipping interests and sporting groups, particularly in the yachting field to which the honourable senator directed my attention and from other boating groups. I am quite pleased with the responses because they represent the views of a fair crosssection of the Australian community. The evaluation of these replies is now proceeding. There will be consideration given to the matter together with an ongoing review of the Bureau of Meteorology within the next few months.
- Mr President, I ask that further questions be placed on the notice paper.
– For the information of honourable senators, I present the final report of the Commission of Inquiry into Land Tenures.
- Mr President, I seek leave to move a motion.
-Is leave granted? There being no objection, leave is granted.
– I move:
I seek leave to continue my remarks.
Leave granted; debate adjourned.
– Pursuant to section 23 of the Egg Export Control Act 1947-73,I present the annual report of the Australian Egg Board for the year ended 30 June 1975.
- Mr President, I seek leave to move a motion.
-Is leave granted? There being no objection, leave is granted.
– I move:
I seek leave to continue my remarks.
Leave granted; debate adjourned.
Report on Port of Darwin
– On behalf of the Minister for Transport (Mr Nixon) and for the information of honourable senators, I present a report by the Bureau of Transport Economics entitled: Provision of General Cargo Facilities at the Port of Darwin’. Due to the limited number available, reference copies of this report have been placed in the Senate Records Office and the Parliamentary Library.
– I seek leave to move a motion.
-Is leave granted? There being no objection, leave is granted.
– I move:
I seek leave to continue my remarks.
Leave granted; debate adjourned.
Senator Sir MAGNUS CORMACK (Victoria) (3.29)- Mr President, I bring up the final report of the Joint Committee on the Parliamentary Committee System entitled ‘New Parliamentary Committee System’.
Ordered that the report be printed.
-Is leave granted? There being no objection, leave is granted.
That the Senate take note of the report.
Mr President, with the indulgence of the Senate I should like to make a few short remarks about this report.
-Is leave granted? There being no objection, leave is granted.
-Some honourable senators will recollect that this Committee was set up in the Twenty-Ninth Parliament and reformed again in the Thirtieth Parliament. In the Thirtieth Parliament, I was appointed Chairman of the Committee. However, I think it proper that I should draw the attention of honourable senators to the mass of work that was undertaken by the previous Chairman of the Committee, namely, Dr Jenkins, the honourable member for Scullin in another place. I think it is fair that this should be acknowledged.
The second thing that I should like to say is that the Committee had the assistance of 3 members of Parliament who were experienced in parliamentary matters, namely the Hon. J. M. Berinson, who is no longer a member of Parliament, the Hon. David Fairbairn, who is no longer a member of Parliament, and the Hon. A. J. Forbes, who is no longer a member of Parliament, and also the assistance of Senator DrakeBrockman, who is sitting beside me at the moment, Dr Klugman and the previous Speaker of the House of Representatives, Mr Scholes. I mention that merely to indicate that this report has been given an immense amount of consideration by very experienced parliamentarians.
I should also like to add a word of thanks- it is not a glib expression of thanks- to the clerk of the Committee, Mr Horsfield, and to his devoted staff, in particular one Miss Lorraine Calabria, who finished typing this report only at 4.30 this morning.
Mr President, I seek leave to continue my remarks.
-Is leave granted? There being no objection, leave is granted.
- Mr President, I seek leave to make a supporting statement.
-Is leave granted? There being no objection, leave is granted.
– I would be remiss in my duty if in my comments I did not pay a tribute to Senator Sir Magnus Cormack and to the small corps of people who virtually produced this report. We were faced with one of those difficult situations which a lot of people have to face. As parliamentary technocrats we found that we had so many duties to perform that we were remiss in our attendance at meetings of the Joint Committee on the Parliamentary Committee System. As I say, we were confronted with one of those difficult situations. I think that we are indebted to Senator Sir Magnus Cormack, to Dr Jenkins and to the staff of the Committee for carrying on. They faced all sorts of difficulties. At times many of us missed two or three Committee meetings in a row. This gallant few did the job. In this report we see the product of their labours. I know that with the committee structure people have difficult views, but I think one can rightly say that this report is a milestone for the parliamentary committee system. The report certainly is due to the efforts of this- I will not say inner group -
– The junta.
– A presidium, perhaps, that came good. I will leave it at that.
-Mr President, I seek leave to make a brief supporting statement.
-Is leave granted? There being no objection, leave is granted.
– I should like to associate myself with the remarks of the Chairman of the Joint Committee on the Parliamentary Committee System, Senator Sir Magnus Cormack, and of my colleague Senator Mulvihill. When this reference was given to the Committee it was a very timely action because at that time there was a proliferation of committees in the national Parliament. The reference required the Committee to embark on an in-depth study of the parliamentary activities of the national Parliament and also of parliaments overseas. The Committee has been able to present a report which no doubt will be a very useful report for the Parliament. Even if it is not adopted completely, it will be a very useful reference in the future.
I am proud to have been a member of the Committee, but I think in fairness I must say that the drafting of the report, in the main, was carried out by the Chairman, Senator Sir Magnus Cormack, his predecessor, Dr Jenkins, and the small group of people who went overseas to study the parliamentary committee system in other countries. These people took it upon themselves to draft this report which has been presented today.
Debate (on motion by Senator Sir Magnus Cormack) adjourned.
-Mr President, on behalf of the Senate Standing Committee on Social Welfare I present a report on the outstanding references of the former Senate Standing Committee on Health and Welfare.
Ordered that the report be printed.
- Mr President, I seek leave to make a brief statement relating to the report.
-Is leave granted? There being no objection, leave is granted.
-The Senate Standing Committee on Social Welfare and 6 other Legislative and General Purpose Standing Committees were established by resolution of the Senate on 2 March 1976. This Committee replaced the former Senate Standing Committee on Health and Welfare. Under the terms of the resolution establishing these committees, they were empowered, where applicable, to inquire into and report upon uncompleted matters referred to the Legislative and General Purpose Standing Committees during previous sessions. When Parliament was dissolved in November 1975 the Senate Standing Committee on Health and Welfare had 3 uncompleted references. These were:
The Committee has given attention to these outstanding references over a number of meetings and reports to the Senate that it has made the following decisions:
Bill returned from the House of Representatives without amendment.
Debate resumed from 25 May, on motion by Senator Cotton:
That the Bill be now read a second time.
– On Thursday last the Minister for Industry and Commerce (Senator Cotton) presented in the Senate the statement on fiscal policy decisions from the Treasurer (Mr Lynch). In the course of that speech, the Minister said:
The election policy speech delivered by the Prime Minister (Mr Malcolm Fraser) on 27 November included the following passages:
On 14 December, we will start the most rigorous planning for the 1976 Budget. We as a Government will be concerned that you get value for the dollars we spend on your behalf.
Spending on essential Education, Health and Welfare programs will be protected against inflation. At the same time, a great many improvements in administrative efficiency can and will be made.
These actions will give the private sector room to start expanding production and providing jobs.
Over the next 3 years, we will introduce a number of major reforms to direct resources away from Government and back into the hands of individuals and business.
What has happened since that time? In the 6V2 months since this Government took office by fraud, no successful attempt has been made to cut the level of unemployment. As a matter of fact, in March unemployment increased by 20 000 workers to be followed by an increase in May of 13 000 workers. Everybody recalls the statements by the Prime Minister and other Ministers that unemployment would be stopped and that those unemployed would be placed in employment. We know too that, despite the assurances of the Prime Minister, the education, health and welfare programs all have been cut and that all the Labor initiatives which had been developed and which were so progressive have been hamstrung and almost eliminated.
No doubt honourable senators will recall that following the statement in February, this Government, after the Parliament had been meeting for a short period, announced a number of cuts. Now in very strong statements about a so-called package, a package which the Government is trying to sell to the work force and the Australian Council of Trade Unions, the Government is saying that the package is enough to overlook all those massive cuts which have affected the public sector and important public works and have resulted not only in uncertainty but also in many people being put out of work. The simple question I want to pose is: How can we get back to prosperity if we put people out of work? Obviously it is essential to increase consumer spending to ensure the highest rate of employment.
In the February cuts, which the Government no doubt would like to forget, approximately $300m in expenditure was cut and this affected many important projects. Let me remind the Senate of some of them. From the Australian Industry Development Corporation $75m was cut and from the Australian Bureau of Statistics $8m. Health benefits were affected and there was a great onslaught on pharmaceutical benefits with deletions from the free list. Restrictions were applied to something like ISO items on the list resulting in severe imposts upon people who could not afford to pay them. Whether the Government likes it or not, the Australian Broadcasting Commission also was affected. When we talk to the administrators of the Australian Broadcasting Commission they say that the restrictions in programming are due to Commonwealth fund cuts. In February $9.5m was cut from expenditure in the Northern Territory and $24m from foreign affairs expenditure, including a cutback in overseas postings. The current situation is that members of the Department of Foreign Affairs, who were not previously organised into associations, are protesting to the Government about the cuts in staff. That is what has happened to our image externally.
There were also repressions upon the great Australian Telecommunications and Postal commissions and other statutory commissions. There were cuts in expenditure on construction, the environment, housing, education and many other areas about which we all know. Everybody thought that that might be the only initiative taken by the Government in respect of cuts. At the same time there was great pressure upon every department and every statutory corporation to cut out recruitment. In some cases those recruitment directions were modified but generally speaking replacements which were required to staff those departments and corporations even after new responsibilities had been imposed on them by this Government were not provided except in rare circumstances. The latest is that the
Government now says ‘We have a package’ and asks the ACTU to accept the package which, of course, does not accept total wage indexation but offers tax indexation which affords some relief certainly to the very low wage earners in the community. However, in doing this it has adjusted Medibank. The gravediggers have been in to destroy and bury Medibank and it will no longer be a viable concept. As a way of correcting the funds that had been put into all these aspects of social welfare the great idea of Medibank is to be emasculated.
Surprisingly in this and in the other place Ministers every day are trying to defend some of the cuts presently under way. They are saying that the massive cuts which have been made, particularly in construction in which I am interested and in respect of the railway projects in South Australia about which I will talk directly, are only stalling measures and that the State governments will still get the amount of money which was provided by the previous Government. As Senator Wriedt properly said today when asking a question of a Minister, it is a question of the total allocation to the States. The real test is how the figures now provided by the Government after these massive cuts compare with the allocations of the former Labor Government. We all know that one of the reasons for the long agitation in this place by honourable senators opposite particularly which resulted in 2 elections in the 3 years that we were in office was the claim that we were extravagant in our welfare provisions. They said that there was no question that that was the reason and that they had to be cut some time. Before the general election they said that the future of Medibank would be ensured; there would be an improvement in employment and our education and general welfare policies would be maintained. Everybody knows that that was a hollow promise.
May I remind honourable senators opposite of what their Prime Minister (Mr Malcolm Fraser) said on Monday Conference this week. When he was checked by one of the interviewers about these pre-election promises he said literally that politicians could make all sorts of fantastic promises but the resources of Australia were not there to keep the promises. I suggest that he was saying- I do not have the transcript but that is in effect what he said -
-There is no doubt about that. The honourable senator listened to the program, and so did 1. 1 tried today to get a copy of the transcript. In fact Mr Fraser was saying, as we have said, that the promises that he made before the general election could not be taken seriously. But those promises and the actions in this Senate of honourable senators opposite were enough to carry the anti-Labor Parties into government. As a result they have made massive and deadly cuts in important programs which have helped the States and every community in Australia. The great advances in regional development which the Labor Government supported and developed have all been cut. The great programs which honourable senators opposite applauded in this Senate have been cut and they are trying now to defend those cuts.
What are the cuts? Medibank has been slashed by $450m. Health services have been reduced by $100m, including those pharmaceutical items I have talked about. The great aids provided for people who are sick and who need replacement drugs have been cut. Hospital fees are to double and will range from $40 to $60 a day. Mortgage interest rate taxation deductions for families have been excluded. Housing commission homes have been affected. There will be substantial increases in rents for them. Canberra can be used as an example of a localised area in which massive increases will apply in all aspects of the community. The great regional development areas that I have talked about, including Wodonga, the sewerage schemes and the Adelaide water filtration program are all in doubt. The Land Commission policy in my State, which allowed the Australian Government, aided by the previous Federal Minister for Urban and Regional Development, Mr Uren, to buy massive tracts of land to keep land sales down, is suspect. No doubt that will receive the same treatment as all the others.
As a result of the Government’s proposals there will be increases in air fares, presently calculated to be 15 per cent. The allocation for roads has been estimated to be cut from $453m to $220m. There will be an increase in fares in the Australian Capital Territory. I think honourable senators heard yesterday about the new attack on the railways organisation in the Northern Territory which, it would appear, will mean the sacking or displacement of 200 workers in the Territory. These are just some examples of where the cuts will take place.
So what we have in fact is a promise of a package but the promise is not being fulfilled. I did not mention the organisation which was established to assist tourism. This had been very well founded. In fact, it was established by a previous Liberal Government, expanded by our Government but then destroyed completely by this
Government. How can those sorts of things be justified? But the package as such is being held until this Parliament passes the Conciliation and Arbitration Amendment Bill. Honourable senators will recall that whereas earlier the Australian Council of Trade Unions and the Fraser Government were heading for a headlong clash on union elections the Government has now agreed to meet the ACTU. As all honourable senators know, the Conciliation and Arbitration Amendment Bill contains new strictures to be imposed upon the trade union movement. It contains new provisions in relation to union ballots. This Bill will be coming before the Senate for consideration next week. The second reading speech of the Minister for Employment and Industrial Relations (Mr Street), concludes with the following paragraph, which appears at page 2326 of House of Representatives Hansard of 20 May 1976:
As a result of the Government’s initiatives, the ACTU has agreed to take part in wide-ranging discussions with the Government on the state of the economy, with particular emphasis on wages policies. Such a spirit of co-operation is vital in the interests of the Australian community. Wage restraint is essential for economic recovery. As a further evidence of the Government’s good faith, we have agreed not to proclaim the legislation, other than that relating to the appointment of the additional judge . . .
So what the Government is offering to the trade union movement for its support is an effective increase in income tax because of the need to provide for a levy for Medibank. Honourable senators will recall that previously, when in opposition, the present Government parties resisted the imposition of a levy of 1.3 per cent by the Labor Government. But, in power, they have now decided that a Vh per cent levy should be imposed to provide for a new form of Medibank. The new provisions in respect of Medibank are not yet properly understood. Yesterday, in response to questions asked of a Minister in another place about the suggestion by organisations that Medibank could well cost a family man another $10 a day and, in addition, that many officers of the health benefit societies would be dismissed, the Minister stated that the position was still obscure and that he could not tell people about it.
I want to turn quickly to something which is very essential to South Australia but which should concern those honourable senators on the other side of the chamber who supported the 2 great programs which have been developed in our time- I refer to the South Australian senatorsthat is, the rail standardisation program. Agitations were made in the post-war years by the Playford Government for such a program, which we supported. I was active in the debates in this chamber on the issue. There was an agreement that the rail standardisation link between Adelaide and Port Pirie should be completed. This agreement came before this Parliament and honourable senators on both sides of the chamber from South Australia applauded it. As all honourable senators know, before the agreement came before the Parliament and when the matter was a proposal the present Minister for Transport (Mr Nixon) said that the project had to be properly costed and he insisted upon the socalled Maunsell report, which had in mind the efficiency and the correctness of such a project.
-Not that Maunsell. The honourable senator well knows this because he was one of the people who supported the project. I quote the words of the Treasurer (Mr Lynch) in relation to this project:
The Government has decided to ask an independent committee to inquire into the Adelaide/Crystal Brook railway project and the options available, and into the Tasmanian railway system.
This means, of course: Why have an inquiry if there is no intention to stall, to stop the project? The project has been approved by one of the Government’s own consultants. It is something which every Liberal senator supported. The same thing applies to the agreement in respect of the Tarcoola-Alice Springs railway project. How can a country be developed in this way? Mr Killen is on record as having spoken about the failures of the Labor Government in defence matters. That is one essential defence matter. Because of lack of time I am going to be pushed to answer some of the questions raised by Mr Killen. Mr Killen made a very improper attack upon the Labor Government in his defence statement yesterday. He said:
Defence preparedness under Labor was given a low priority. Apathy to defence problems was a distinguishing feature of the Labor administration.
Let me remind all honourable senators that when Mr Barnard was made Minister for Defence he set in train actions which resulted in the following: The complete reorganisation of the Services, increases in pay and a new method of calculating pay for every serviceman, including the members of the Civilian Military Force. These things had never been introduced by the Liberals- they were introduced by Labor. There was a re-engagement bonus for servicemen and an allocation for war service homes. Every serviceman had the right to apply for a war service loan. He had the right also to get repatriation benefits. We did that, not the Liberal Government. We also provided for new and improved leave provisions for people in civilian employment. We established the position of ombudsman. In addition, we did something which the present Government Parties opposed. In 1972, as soon as Barnard became Minister for Defence, he instructed that there be an examination for the reorganisation of the Services. We brought to the notice of the Senate the fact that in the 1950s the General Morsehead report in fact stated a number of grounds upon which this should be done. In the Senate and in the other place this was strongly opposed by all Opposition members. It was only because of support from Senator Hall, who was then an Independent, and from Senator Bunton, that we got that legislation through. It meant a great reform in making sure that each arm of the Service works intelligently within an integrated defence service.
Nobody who understands the position can say that what was done by the Australian Labor Party in the area of defence was not constructive. None of the programs included in the statement made by Mr Killen was initiated by this Government. All the programs were initiated by the Barnard-Morrison combination in the Whitlam Government. I took part in some of those matters because during most of the time I was the Assistant Minister for Defence. It is unfortunate that people should use a report such as this to be political in the sense that they do not recognise the great contribution which was made. The Government says: ‘Yes, we will spend millions of dollars’. But the Government is not going to spend this money now. The important point which was made in the report was that most of that money will be spent in the last 3 years. Let me remind the Government about a little matter. Mr Killen went on record as saying: ‘As soon as we get to government, we will restore the cadet training scheme’. That was 6lA months ago. Presently, as everybody knows, the aircraft industry is begging for assistance. If it does not get assistance from the Government quickly the whole machinery and organisation and the great developments which were carried out as part of our support for the Nomad program will fold up. It is essential that some funds should be given.
The only answer which the Minister has given for this part of the program is to say that there will be a study by the Defence (Industrial) Committee. That Committee has been in existence for years and years. I agree that it performs a great service to the nation. What the people of Australia are concerned about is the confusion which results from these massive cuts and from the indecision about the welfare programs, particularly about the future of Medibank. What will happen to the aims of this Government in relation to employment? I suggest that they are matters of which the Government and Ministers in this place might well take notice. Instead of Ministers aggressively answering questions asked from this side of the Parliament and trying to defend something, very often in a deceptive way because total funds to the States are being cut, why do they not admit the circumtances if that is the fact? Let the Government face up to the promises it has made. I think it is unlikely that the Australian trade union movement will accept the proposition which has been afforded to it at the present time. But it is not for me to say that there should not be consultations between the employer organisations, employees and the Government. I believe in that; I support it. However, Government policies do not lead one to think that the results in the future will be favourable.
– I have been very interested in the course of this debate which started yesterday to hear the attitude of the Opposition. There has been a lot of unjustified and very biased criticism. One can appreciate that the Opposition will be critical of many things in the economic statement as it was put down by the Treasurer (Mr Lynch) last Thursday night because many of the Labor Government’s policies have now been reversed. But I repeat that I have been surprised at so much unjustified and illogical criticism which has been levelled by Australian Labor Party members of the Senate. When the Fraser Government came to power last December it knew then that its task would not be easy. The Government knew that big changes needed to be made in government policies because what Australia was looking for at that time and what it needed was not only responsible government but also a government which would act responsibly. This is exactly what the Fraser Government has done. It is high time that people in the Parliament recognised the critical situation which Australia was facing. If we look at the situation when the Fraser Government came to power we will appreciate that we were faced with a huge deficit. We were faced with all sorts of economic ills such as inflation which had been the highest of all times in this country. So it was necessary that these things be taken in hand.
I have been highly encouraged and in fact delighted by the reaction of the general community to the economic policy statement presented to the Parliament last Thursday night by the Federal Treasurer. More criticism has been levelled at the economic statement in this chamber than I heard as I moved around last weekend in my State of South Australia. I refer to the criticism levelled by the previous Prime Minister, Mr E. G. Whitlam, last Friday when he stated on air that the way the Fraser Government was going about its endeavours for economic recovery was entirely wrong. This statement from Mr Whitlam rather fascinated me. If we recall, when the Labor Party came to power conditions in Australia were among the best of any country. Our inflation then was standing at what now appears to be the ridiculously low level of 4.6 per cent. The mining industry and oil industry were going extremely well. Exploration was booming and business was expanding. There was confidence in the community even though at that time there was concern that 4.6 per cent inflation was high. There was also concern at the level of unemployment.
When Mr Whitlam went out of power last December what was the situation? Australia at that stage was heading for something like 20 per cent inflation which at that time was running at 16 per cent. Unemployment was at an all time record high for Australia. The confidence of the community was absolutely gone. Business had run down. There was no confidence in the business community whatsoever. So that was the situation we had. One could go further and say that tragically for Australia at that time we were winning the international inflationary race. All I say in answer to Mr Whitlam ‘s comments of last Friday is that I do not consider for one moment that he could possibly be an authority when it comes to economic recovery. If we want to start talking about authorities with regard to the creation of inflation I doubt that there is a better leader in the world than Mr Whitlam because he was winning the international inflation race. As has been stated many times, the Fraser Government and Australia were faced with a frightening deficit. Last year we finished up with a deficit of some $2,500m which followed the pattern of the year before because Budget estimates were a long way out and again the Government finished up with a huge deficit.
This year every indication was that we could finish up with a deficit of some $5,000m. So it was necessary that steps be taken. When one considers that we had a $2,500m deficit last year the probability was a deficit- unless steps were taken- of something like $5,000m this year. So in 2 years we had something like a $7,500m deficit which is many times greater than our total internal revenue was some few years ago. That was the position, and it was necessary for steps to be taken. I was rather amused this afternoon to hear my friend Senator Bishop comment that there is great concern and confusion about the gigantic cuts in Government expenditure. It was essential that the Government should take some steps, cut its coats, or to put it another way, expenditures, and reduce the deficit. We are all very conscious of the fact that excessive Government spending-realistically, we have lived with it- is in itself terribly inflationary. So the Government has set about curbing inflation as much as it can. While its overall policy is to curb inflation, at the same time there are other priorities and I should like to refer to them later. Those priorities are to give assistance to the needy as well as to encourage incentive to enable business to get moving again in Australia.
Inflation has caused much hardship and harm in the community, has adversely affected industry and commerce in this country, and has disadvantaged us as a trading nation. There are many reasons why inflation must be the No. 1 target of the Government. It creates unemployment, it hurts the aged, it provides a disincentive for thrift. So many factors are involved. One could go on and level so much of the blame for inflation at the previous Labor Government, but I am not here to look backwards.
– You have not done a bad job.
– Our job is to look ahead to see what can be done. I must say that one is entitled to answer argument coming from the other side, particularly when so much of the argument in the course of this debate- although not from the previous speaker- has been totally illogical and unjustified. This year the Government has endeavoured to reduce what would have been a deficit of some $5,000m by cutting its expenditure to the extent of $2,600m. That is a colossal amount of money by which to reduce Government expenditure, and some people in some areas will be critical of some of the cuts that have been made. When a crisis situation exists it is necessary to go to the maximum of the safety factor to do what is really essential to curb inflation and to get the Australian economy back into a sound position. The problem is not going to be overcome in one year, in all probability, or in 2 years. The crisis is great and it is going to take some time and a lot of hard work, as well as a lot of responsible leadership from the Government, for us to fully recover the situation.
In addition to all the cuts the Government has made, it has also introduced many innovations. I refer to the area of tax indexation which is entirely new in Australia. Granted, it was talked about by the Labor Party when it was in office but no action was taken. One can appreciate why action was not taken. If there is one area in which inflation works to the benefit of a group it is in the area of government. Governments can get fat on inflation. It gives them the opportunity to go ahead with taxpayers money and do many things for which perhaps they would not be able to get legislative agreement in the Parliament. In our policies prior to the December election we made it perfectly clear that we supported tax indexation and would introduce it progressively over a period of 3 years. But, as we all heard last Thursday night, rather than wait for 3 years the Government is going to introduce 100 per cent tax indexation this year. That will be of great benefit to the country generally and particularly to the wage earners. Tax indexation means that income earners will no longer be taxed on the inflationary aspect of their wages. For too long, due to inflation, we have seen income earners move from what was regarded years ago as a good sound high income bracket into average income brackets today without tax restructuring. Every time they got a wage increase there was an inflationary loading included in their tax category. Taxation took a big bite from the increase. The attitude of many people was: Inflation is costing us x per cent this year. We have got a percentage increase in our wages of that much, but because we have moved into a higher tax bracket the tax man is getting so much of our wages. Therefore we are going to ask for another increase’. So further wage demands were made until we reached a situation where wage demands were far greater than the country’s productivity. That was another of the causes of the escalation of inflation in this country.
More than that, real incomes- that is, the ability of the pay packet to purchase- were greatly eroded due to taxation in relation to inflation. With tax indexation, the inflation factor will no longer apply and that should be a disincentive for excessive wage demands in the future. Some on the other side of the chamber will say that wages do not have any effect on inflation. One is fully conscious of the fact that many speakers within the Labor Party, including some of their Treasurers, have said very clearly that excessive wage demands were causing great concern because they put inflationary pressures on the economy. I think the Government is to be commended, not just for introducing tax indexation this year but for introducing full tax indexation which will give full benefit to wage earners and at the same time act as a counter measure to inflation.
In the Government’s policy statement the Treasurer has made it clear that the Government will give every encouragement to the resurgence of investment in the private sector to encourage business to develop and expand. One of the tragedies of the last few years has been the rundown of business, and not just of big business. So many small businesses throughout the country have crashed. When one considers the areas of unemployment, it will be appreciated that private business employs something like 70 per cent of the work force of this country. Private business was being squeezed out and there was a great need to give encouragement to the private sector of the community to make sure that business will get going again and that with consumer demand, to which Senator Messner referred last night, and with a regeneration of vitality within the community, eventually we will take up the great and unfortunate slack in the unemployment factor.
Another top priority I mentioned earlier relates to the benefits given to the poorer and disadvantaged sections of our community. Unfortunately, I do not have time to go into the detail of what is involved in the area of assistance to families but I will refer to statements made by the Minister for Social Security (Senator Guilfoyle) relating to child endowment. Child endowment has been increased to $3.50 for the first child, going up progressively to $7 for the fifth child and subsequent children. There has been a great increase in child endowment but more important than that is the fact that it will be a non-taxable family allowance. At the same time, the taxation rebates for dependent children which were allowed in the past are going to be abolished. So in the area of social services there will be a greater levelling out and a greater benefit, with child endowment payments being non-taxable. That will give far greater assistance to poorer families, particularly as the endowment has been increased significantly, while at the same time the dependent children’s allowance for taxation purposes has been abolished. This Government has looked very earnestly to giving assistance to the poorer and needier areas of our community.
Unfortunately, as I said earlier, there is not the amount of time available to continue in this area. I would like to refer to local government, a subject to which Senator Bishop referred earlier this day. I think this is one of the important areas. As time goes on more and more people in this country will appreciate the impact of what was said last Thursday night. The policy of federalism recognises the third arm of government within this country. Local government for too long, particularly since the Labor Party took over, has had to come to Canberra with cap in hand. One can go on and talk about the volume of money being given to local government. One will not argue about the aspect of dollars and cents. One can argue very conclusively on the fact that local government had to come to Canberra with cap in hand for its revenue. The Labor Government not only used but also abused section 96 of the Constitution. There is no doubt about that. I have spoken on this aspect in this Parliament before. Section 96 gives control of any grant to the donor government, in other words, to the Federal Government. This was the situation with so many of the grants made to local government during the period of the Labor Government. As Senator Carrick has said in answers to questions in the last few days, local government today financially and independently will be better off than it has been in the past.
This Government is making an attack on inflation and doing so many other things. One can appreciate that there will not be the realistic fear of the great escalation of rates that we have seen. Figures given in the last 2 years reveal that local government rates have increased by approximately 35 per cent. It is anticipated this year that rate increases in Australia can perhaps be kept down to an average of about 5 per cent. I am not citing figures of my own. I am citing figures that have been given in this chamber. Local government plays a very important part in our community. One of the problems facing local government in the last 3 years was the great danger that with centralised control local government to a great extent was losing its local control and identity. These are unfortunate trends that fortunately today have been curbed. The Government has recognised within the financial structure of the federal sphere the 3 arms of governmentfederal, State and local.
I would like to speak on many other matters. I appreciate the time factor involved in this debate and content myself with saying that whilst 1 could go on and commend the Government for its actions and many other issues in the last 6 months, particularly on its economic statement put down last Thursday night, I hope the Government will continue to show the courage it has shown and continue to give the leadership it has given. I hope that we can get on with the job of continuing economic recovery in Australia with the eventual aim of again seeing Australiaas it was not so long ago in terms of time; it is 3 years- really moving forward and expanding in all fields of production, development and economic stability with related socio-economic benefits.
– I would like briefly to comment on a couple of points made by Senator Young in his rather extraordinary speech on the statement made by the Treasurer (Mr Lynch). The first point worth commenting on is surely the last one made by the honourable senator- his extraordinary statements on local government. Senator Young used the magnificent expression that local government, under Labor, had to come cap in hand to Canberra to get money for the various facilities which local government provides for the people in the community. If being able to attend Grants Commission meetings and putting one’s case is going cap in hand to Canberra, his statement may be correct.
I think Senator Young should well remember I am sure his memory is good enough- that before 1972 it was of no use local government coming to Canberra at all because the Government which he supported would not give any aid to local government. It never did and it never considered doing so. Now because Senator Young’s party has decided to extend, in a rather irrational way in the view of this party, what the previous Government had done, he proclaims that this is the great new initiative of the present Federal Government. I believe that no one will be fooled by this, least of all the members of local government including the President of the Municipal Association of Tasmania who has made it perfectly clear that rates in Tasmania this year will have to go up 20 per cent plus despite the present Federal Government’s grants.
– Who caused the increase?
-I point out to Senator Wright, who is always interrupting, that that very man will be a Liberal candidate in the next State election. Another interesting point which the previous speaker made was the extraordinary statement that we are suddenly going to have non-taxable child endowment. I would be very interested to hear when child endowment in this country was ever taxable. This is an extraordinary statement and one which tries to make a bit more out of a reform which I happen to agree with. But he just oversteps the mark.
This debate on the Treasurer’s statement has been like similar debates- a wide-ranging affair. I suppose this wide-ranging debate befits the Treasurer’s wide-ranging statement. I believe the statement demonstrates the Government’s firm intention of opting out of all the previous Government’s initiatives as much as possible. I believe this will be done without consideration of the effects on the community as a whole. To me the statement seems to express the desire of the Government to revert to the sort of conservative role which is not seen in any central government in any country which can be at all compared with ours. To me it reads like some papal encyclical in which the Government expects to make a futile attempt at turning Australia backwards by just making a statement and by putting down a dogma.
-I thought ‘bull ‘ would be a better word than ‘encyclical ‘.
-That may be so, Senator Primmer. We have heard a lot of speeches on this matter. I was interested in the speech made by Senator Lajovic last night. I was in the chamber when Senator Lajovic made his first speech to the House and although I did not agree with a lot of what he said I was very impressed by the thoughtful nature in which he made his speech and the ideas he put up. However, I was not impressed last night. I do not suppose he would expect me to be.
I realise that in debates in this chamber we all carefully select facts and figures and we all carefully twist words and arguments to support our case. Some do this more than others. Some will not recognise that they do so. I believe that the selectivity of Senator Lajovic’s comments and so-called facts last night is worth replying to. He made a great tirade against what he sees as the great socialist threat in this country. He used the oldest tactic which has been used in this Parliament to succeed in this aim. I refer to the old guilt by association attempt. He talked about unhappiness in the Union of Soviet Socialist Republics and about various unhappy people he seems to know in Yugoslavia. He went on to demonstrate the unhappiness of the Yugoslavs by the fact that large numbers of them go as emigrant workers to other countries in Europe. Senator Lajovic did not mention that large numbers of Italians go to other countries in Europe, and Italy is ruled by a conservative government like the one he supports. Large numbers of Spaniards-Spain is ruled by a conservative government like his own- and large numbers of Turks- Turkey is hardly a pro-communist country- also go to other countries in Europe. Where do they go to work, Senator? They go to work in West Germany which has a social democratic government. That country is governed by a party which is a fraternal party of the Australian Labor Party. It is a democratic socialist government. Senator Lajovic uses careful selectivity of facts.
– They go there to get jobs.
– The people go for all sorts of reasons. They do not go there because Yugoslavia has a particular type of government. They do not go to West Germany because West Germany has a conservative government; it has not.
– They go there because they cannot find work in their own countries.
-As the Italians do. It has nothing to do with the political situation in their country or with the party in power in their country. The honourable senator knows it. He was being highly selective, as he was in the rest of his speech. He brought up the great furphy about Sweden. He said that Sweden has the highest suicide rate in the world, a statement which he admitted was wrong. Sweden has one of the highest suicide rates in the world.
– I said it had one of the highest rates in the world.
– The honourable senator corrected it to that. I accept that. Like many countries, Sweden has a higher suicide rate than others. Is the honourable senator attributing that suicide rate to the fact that Sweden has a socialist government? Is he saying that Norway, which has a suicide rate which is less than half of Sweden’s and which also has a socialist government, is connected? Is he expecting the Swedes, who have the lowest infant mortality rate in the world and who have the best care for the aged in the world, to exchange those privileges for what we have in this country? He was using an old furphy which no one swallows any more.
– Sweden has the highest taxes.
-Senator Withers’ comment interests me. He is another person who does not like Sweden. Everyone in the Government does not seem to like Sweden, but the frequency with which they buy Volvos and Saabs and drive around the country in products of Swedish enterprise always amuses me.
I think the worst part of Senator Lajovic ‘s speech was his effort on ethnic radio. He said that what ethnic radio should do- I agree with him- is that it should provide companionship for migrants who are lonely. It should provide education for migrants who want education. It should provide information for them. It should provide cultural interests, music from their home country and plays from their home country. He proceeded to insult the intelligence of his new Australian colleagues by saying that we must not have anything political on ethnic radio. That would be a terrible thing. We should help these people to assimilate. We should help them to retain their interest in their home country. Why on earth should we exclude politics from their own radio stations? It is an insult to their intelligence. I am very surprised that anyone in the Government, especially Senator Lajovic, would put up such a proposition. I believe his attitude is typical of the attitude of the Government generally.
It seems to me that we now have a government with an attitude of extreme conservatism which looks at proposals for change and reform, not on the basis of their merits, not on the basis of what they will do for people in this country, but on the basis of who put up the proposals. If it is a Labor proposal it is bad. If it is a conservative proposal it is good. Nothing in this community could be more divisive than what Senator Lajovic suggested last night.
– It was decided on 13 December.
– I will give him an example because I think his interjection is pertinent to this point. Last Thursday night in the House of Representatives a Bill was introduced into this Parliament. It sought to introduce a levy for Medibank. It was the same in all respects as the Bill which was introduced into this Parliament by a Labor government in 1974 and 1975. That Bill was opposed and knocked out by the conservative Opposition. The Bill was described as one which would put Australia on the rocky road to socialism. It was also described as dictatorial. It was one of the Bills which was the basis of the double dissolution of 1 1 November. It was one of the 2 1 Bills referred to in that glorious pamphlet that the Liberal Party produced on how it would rule Australia. I hope all honourable senators opposite cross the floor when the present Bill is voted upon. All the speeches on the previous occasion were very interesting. Now honourable senators opposite have done a complete turnaround on what they said to the people of Australia before 13 December.
The measures outlined in the statement contain one worthwhile reform. I agree with that reform. I refer to the new child endowment proposals. These were the proposals recommended by Professor Henderson in the poverty report, but it should not be forgotten that he recommended these changes as an interim measure, to tide people over until a guaranteed minimum income scheme is introduced. Although they distribute money to the people, as I think Senator Martin said yesterday, and give benefits to some of the poor families, especially the larger poor families, they also distribute money to some of the wealthy families and some of the rich larger families. They are not the redistributive schemes that will bring everyone up to the same sort of reasonable level. They have this double-barreled effect. In many cases they take money away from the people in the middle.
Many of the gains that people will receive from the introduction of this child endowment scheme and from the introduction of tax indexation will be lost. I noticed on my desk today, with the compliments of Senator Cotton, a set of tables which show the effect on taxpayers of the new proposals for child endowment and tax indexation. Added to them are the new proposals for the Medibank levy. The introduction of the Medibank levy or the forcing of people into private insurance has, in many cases, cancelled the good effects of the child endowment proposals and the good effects of tax indexation which was praised so much a moment ago by Senator Young. People on the average income and thereabouts and even the poor people who receive some cash benefits from the new child endowment scheme and, in some cases, from tax indexation will be further affected. They will have their gains further eroded by some of the cuts which have been announced by the Government.
One of the cuts which will affect these people is the cut in the child care programs. The needs of the impoverished people, especially the single parent units, are needs not only for cash but also for services- needs for all sorts of child care services. The fact that a lot of these child care services and child care programs will not go ahead will eat into the benefits that are received because in many cases these people will have to pay for the provision of those facilities. They will be affected by the greatly decreased expenditure on hospital facilities, on community health projects, on transport, on roads and on local government facilities generally. All these indirect effects will be felt quite severely by this group. The second group which will be affected, the group which all the newspapers and many speakers have pointed out will be affected, will be the group in which the income earner receives average weekly earnings or about that figure. It extends from about $140 a week to about $220 a week and higher if both parents are earning. In these cases any benefits received from the child endowment proposals and any benefits received from tax indexation are wiped out straight away by the Medibank levy or, in the case of many of them, by the need to insure privately with the voluntary health funds, as many of them wish to do.
This group is a very large group in the community. Generally the unit consists of parents and one or two children. They are generally young. They usually have a mortgaged home. They will lose their right to claim interest on the mortgage as a tax deduction. They generally live in the outer suburbs of cities or in country towns. They have a great need for the provision of sewerage, road works, hospitals, community health centres and child care facilities in general. In fact, they not only need those things; they also deserve them. These are the people who deserve a decent way of life in this country as much as anybody else. These are the people in their suburban homes, who frequently get up in the morning, travel to work in the city a fair distance away on inadequate public transport, often work in private industry in large buildings which are air conditioned and carpeted and then return at night on the same inadequate public transport, frequently to inadequately paved or unpaved roads and not uncommonly in our large cities and on the outskirts of our large cities to unsewered homes.
– You do not have to go too far out of Perth to find that situation.
-Perth may be different; I am not very familiar with it. These people realised 3 years ago that this sort of provision was necessary. They realised also that because of the way things had been going in Australia, the initiative could come only from a national government. These activities are reasonable national activities. It is reasonable that the national government provides funding, initiatives, planning facilities and, in consultation with the people at a more local level, oversees the development of these facilities. But we find that the urban and regional development projects of the Government are almost non-existent. We find that almost all government interest in the environment is gone. There is to be a cut of $200m in transport expenditure and hospital and community health spending is to be cut.
I am fascinated by the priorities in this document and by those of honourable senators opposite. They accept with great equanimity the fact that in the Treasurer’s statement child care expenditure has been cut and that expenditure on other facilities has been cut. Yet day after day in the Senate they rise to their feet asking the Government when millions of dollars will be spent on the reintroduction of the cadet corps, which the Army does not want, which it thinks is inefficient and which benefits only a few thousand people in our community. But the reason given time and time again for the cuts in government spending is that they will cut inflation. We recognised when in government that there would have to be some cuts in government spending. We made cuts in government spending and probably received more abuse when we made those cuts last September than the Government is now getting. But this across-the-board slash in expenditure on practically everything the Government does seems to me to ignore the needs of many of the people in the community, to ignore the benefits that have been achieved by many of the programs. Even worse, it seems that there is an attempt to push off on to the States and in some cases local government so many of the things that the Federal Government has done previously.
No one has attempted to explain to me how this affects the inflation rate in the community. How can the transfer of government spending from the Federal Government to the State governments result in a reduction of inflation or, I ask from my knowledge of State governments and local governments, how will it result in more efficient spending. We can assume only that this decision was designed to set in train a reversion to the days when the national government in Australia did very little but discuss the future of Canberra, foreign affairs occasionally and pensions. Surely this will not work. Surely we cannot be asked to go back to the days when the States were competing colonies and when little thought was given to the development of Australia as a whole. I realise that we still have Premiers like Mr Bjelke-Petersen who believe that our international boundaries should be set by the States and not by the Federal Government. I realise that we still have people like Sir Charles Court and Lang Hancock who believe that our trading policies and export policies should be decided by the States and not oy the national government. Mr Bjelke-Petersen even considers that Tasmania is a foreign country and that he should use resources diplomacy with Japan to prevent Japan buying Tasmanian meat. Is this the sort of situation that the present Government intends to see arise in this country? I believe that the care of children; transport needs, perhaps above all needs in the country; the development of reasonable urban facilities and the preservation of the environment are appropriate matters for discussion, decision and initiative by the national Parliament.
I think that the worst feature of the Government’s campaign against inflation and to reduce the deficit to an arbitrary level- although comparable countries have deficit levels of about the same percentage of their gross domestic product as our deficit- is the persistent and continuous denigration of public enterprise and initiative in this country and with that the denigration of those public servants who are part of this public enterprise. In so many speeches of Government members in this country we hear this persistent denigration of people in government departmentspeople who work very hard and efficiently and often under not very good conditions. I heard Senator Knight, the new senator from the Austalian Capital Territory, try to make some balance in this state of affairs because most of his constituents are public servants.
Mr Acting Deputy President, my time is short. I believe that the philosophy behind the Government’s actions of cutting government spending willy-nilly across the board, with very little consideration of priorities and the suggestion that public enterprise and initiative is always bad and that private enterprise and initiative is always good, is flying in the face of the practices used in the development of other countries. It is flying in the face of the future satisfactory development of this country. For that reason I am disappointed in general with the Treasurer’s statement. I do not see how the policies exemplified will do anything to oversome unemployment in this country. In fact, I believe that they will make unemployment worse. I fear for future expenditure cuts in the Budget proposals. I am amazed at Senator Young’s comment that in his wanderings around South Australia at the weekend he could not find any criticism of the Government’s actions. I can only believe that Senator Young has followed the example of his Leader in the Senate and has stopped reading newspapers, stopped listening to the radio and stopped looking at television.
-On 13 December last year- some 6 months ago- the Fraser Government was elected by an overwhelming mandate of the people of Australia, primarily because of the economic chaos that had been caused by the previous Labor Government. When this Government came to power some 300 000 people were unemployed- the worst unemployment rate since the Depression of the 1 930s. There was the highest inflation in decades. The housing industry had been demolished to the point that whereas previously a person in receipt of an average wage could buy a home, that person had been costed out of the market. The building, construction and housing industries were in disarray. Even worse, some 15 per cent of school leavers were on the dole. They were incapable of getting jobs. Some 20 per cent of school leavers were in makeshift jobs and a significant percentage had gone back to school or college. In fact, there were great threats to the future careers of tens of thousands of young Australians quite apart from their parents. It was against that background that the Australian people gave to the Fraser Government a clear mandate to restore economic stability.
We are now debating an economic statement brought down last Thursday evening by the Federal Treasurer (Mr Lynch). We are debating it in conjunction with a number of appropriation Bills. In essence, that statement seeks to do some three or four main things. It is very instructive for us to try to find out what it is that the Labor Opposition is opposing. Let us take the points one by one: The Government seeks to introduce full tax indexation giving back to the people of Australiathe wage and salary earners- some $ 1,200m of tax which would otherwise have been harvested. I had not heard anybody in the Labor Party say that he is opposed to tax indexation or full tax indexation. Certainly the trade union movement is very strongly in favour of it, and the Australian community is very favourably disposed to it. I invite the Labor Party to say that it does not support the principle of full tax indexation. If the Labor Party supports tax indexation, however mutely, it has to find ways of finding some $ 1,200m of tax revenue forgone in the coming Budget. That takes some explanation.
I have not heard members of the Labor Party say that they are opposed to the new family allowances. The contrary is true. After all, it was a Liberal federal government that set up the Commission of Inquiry into Poverty under Professor Henderson. It took a Liberal federal government to redistribute income to the poor in the greatest redistribution to the poor that has occurred since Federation. It took a Liberal federal government to embark upon significant redistribution of income from the male spouse to the female spouse, that is, redistribution of income to the mother to help her with her responsibilities for supporting the family. I have not heard the Labor Party say that it is opposed to the new family allowances. To what is the Labor Party opposed? Is it opposed- and this is important- to the need to cut by roughly half a prospective Budget deficit of $5,000m as disclosed by forward estimates? I have heard a general attack by the Labor Party on the thesis of cutting a deficit of $5,000m by approximately half, by an amount of $2,600m. I have heard a general attack on the philosophy of cuts in expenditure. It is important once again to remind the Federal Labor Party that in August last year it went to the people of Australia, with the presentation of the Budget, and said: ‘We have prospectively in our forward estimates a deficit estimated at $5,000m. We cannot allow the people of Australia to have a deficit of $5,000m, as disclosed by forward estimates. We propose to cut it in half. I will read what the Labor Party said some eight or nine months ago was imperative to be done regarding a deficit of $5,000m as disclosed in forward estimates. In this Budget Speech, the former Treasurer said:
This year’s budgetary considerations began, as usual, with an examination of the prospective Budget aggregates. Expenditures were projected to grow much more rapidly than revenues and the prospective deficit was nearly double that of 1974-75. Clearly, such a deficit could not be countenanced under the circumstances.
In the context of an economy beginning to pick up, a deficit of the order initially projected would have been a prescription for accelerating inflation. Its acceptance would have been tantamount to abandoning concern with inflation, discarding our wages policies, condemning the corporate sector to an attack upon its profitability and threatening the future jobs of thousands of Australians . . .
Those were the reasons given by the former Treasurer, Mr Hayden, as to why a deficit of $5,000m prospectively disclosed in forward estimate had to be halved. He said what had to be done. My Government not only has said what has to be done but we have done exactly that. My Government inherited for this year a prospective deficit of $5,000m. Because we will not put up with inflation, unemployment and all the things diagnosed accurately by the Labor Party, but not acted upon by the Labor Party, we have acted. In other words, Mr Hayden said that if there is a prospective deficit of $5,000m, it is the responsibility of the Government to cut that deficit by half, by cuts throughout the whole area of government spending. He said that the Labor Government would do that but it did not do it.
I have seen honourable senators opposite crying crocodile tears today when they have talked about cuts and how wicked cuts are. One would think that the Labor Party had made no cuts at all in the great welfare programs or had not cut back the specific purpose grants to the States or reduced the spending of the States at all. Last year the Whitlam Labor Government cut by $105m the amount of funds available to the 4 commissions which are responsible for allocating funds in the education field. The former Labor Government cut expenditure on education in real money terms by 6 per cent, yet Opposition senators are now horrified at cuts in government expenditure. It cut the amount of funds available to universities by $21m, to colleges of advanced education by $32m, for technical and further education by $9m and to schools by $43m. That represented-a total cut of $ 105m in expenditure on education last year. It forced the universities to take in 9000 fewer enrolments than the year before, and it reduced the ability of matriculants to receive tertiary education. This was done by the Party that now says to us that it is wrong to make cuts.
The Labor Government itself said that if there is a deficit of this size it must be reduced by half, otherwise all sorts of things happen. It created mayhem in the field of education and in other fields and slashed specific purpose grants to the States, yet Opposition senators now get up in this chamber and have the gall to say that cutting government expenditure through government departments is wrong. They do so after having said that it was imperative to reduce the deficit. I again ask: Is the Labor Party opposed to tax indexation? Certainly it is not. Indeed, I have heard many Labor senators argue furiously about this matter. It is true that Mr Whitlam was opposed to tax indexation, but I do not know why. Is the Labor Party opposed to the new family allowances? I take it that it is not. Is it opposed to reducing the deficit from $5,000m to about half that amount? Again, I take it that it is not. I say this because Mr Hayden, with the support of the then Government, said that this must be done. To what is the Labor Party opposed in this package? Let Opposition senators stand up and be counted. Let them explain why last year they saw this problem clearly but now they see otherwise.
I direct my attention now to the rectification of Labor’s ills. Unless we can restore the economy, beat inflation and restore employment, no social welfare programs however great, no aid and no support system will have any real relevance because we will not be able to project into the future. So the task which must be done- the former Labor Government said that this had to be done but it did not do it- is to do the very things that we are now doing. Let honourable senators opposite now say why it was right to do these things before but it is wrong to do them now. Let us look at this matter. I am able to come before the Senate, as the present Minister for Education, and report that my Government regards education as having such a high priority that not only have we stopped cutbacks in education and set aside as being wrong the actions of the previous Labor Government but also we have provided real growth in education in real money terms.
The Labor Government abandoned the triennial system of funding and introduced a system of calendar year funding. I am able to come before honourable senators and say that with all the difficulties of inflation in the world my Government has introduced an imaginative and effective system of rolling triennial funding which guarantees minimum growth, real growth in money terms for the future, and allows real planning for the future in each of the areas covered by the 4 education commissions. This is something that the Labor Party could not do.
I am able to say, for example, with some very real pleasure that both the Australian Teachers Federation and the Australian Council of State School Organisations have come out in support of what the present Fraser Government has done. Let me read just a couple of passages from the statement signed by the President of the Australian Council of State School Organisations and the Acting General Secretary of the Australian Teachers Federation. This statement says in part:
The survival of education programs in the midst of wide ranging expenditure cuts is a significant achievement for many thousands of concerned parents and teachers throughout the nation.
When faced with the hard realities the government recognised that further cuts in education would have caused long term damage to children and the nation as a whole.
The government has responded to the broadly based concern of parents and teachers who have pointed this out to parliamentarians both in their own electorates and in the Federal Parliament.
Given the state of siege on welfare programs, Education Minister Carrick has clearly won a major battle to hold the line and provide some growth in real terms.
I ask for leave for the statement as a whole to be incorporated in Hansard.
The ACTING DEPUTY PRESIDENT (Senator McAuliffe)- Is leave granted? There being no objection, leave is granted. (The document read as follows)- 21 May 1976
STATEMENT BY JOAN KIRNER, PRESIDENT, AUSTRALIAN COUNCIL OF STATE SCHOOL ORGANISATIONS AND BOB HARRIS, ACTING GENERAL SECRETARY, AUSTRALIAN TEACHERS* FEDERATION
The survival of education programs in the midst of wide ranging expenditure cuts is a significant achievement for many thousands of concerned parents and teachers throughout the nation.
When faced with the hard realities the government recognised that further cuts in education would have caused long term damage to children and the nation as a whole.
The government has responded to the broadly based concern of parents and teachers who have pointed this out to parliamentarians both in their own electorates and in the Federal Parliament.
Given the state of siege on welfare programs, Education Minister Carrick has clearly won a major battle to hold the line and provide some growth in real terms.
The 7.5 per cent real growth rate announced for technical and further education is badly needed in an area which had been sadly neglected until 3 years ago.
Federal funding of education remains, for the second year in a row, at a ‘holding’ level, although there is some provision for a small amount of real growth.
However, there will be no improvement for state schools, if the promised 2 per cent real increase is used entirely for non-government schools.
The promises of the original Karmel Report to bring all schools to an acceptable level, previously set back to the early 1980s, could now be delayed until the 1990s.
There is some danger in the announcement that supplementation for education programs will no longer be automatic.
Without automatic indexation of this kind, we will need to watch carefully that the government’s commitment to real growth is not undermined.
The establishment of a rolling triennial program recognises the need for forward planning but we will watch carefully to see how this new system works in practice.
-I thank the Senate. I am delighted that parent and teacher organisations should have seen fit to acknowledge the programs of the Government. I am delighted too that education departments can plan forward in real terms for the 3 years ahead. Universities will be given 2 per cent growth in real terms this year and a minimum planning of 2 per cent in the years ahead. Colleges of advanced education will be given 5 per cent this year and a minimum 2 per cent for the 2 years afterwards. Technical and further education about which the Australian Government has very real concern for expansion has been given 7.5 per cent this ye.” and a minimum guarantee of 5 per cent in the 2 years thereafter. Schools have been given 2 per cent in real money terms this year and 2 per cent minimum in the 2 years thereafter.
What we have therefore is basically a major restoration from the mayhem that had been caused by the previous Federal Government.
The members of that previous Government have the gall to get up here day in and day out and say that it is wrong to make cuts. I repeat to the Senate that they are members of the former Government which last year cut education in the 4 commissions not by some petty cash figure but by $105m or 6 per cent, and denied an intake of some 9000 students to universities. The Labor Party now sees no virtue in what is happening. That was the Government- let me repeat thiswhich last year said: ‘It will be disaster if we have a deficit of $5,000m. You have to halve it’. It now asks: ‘Why should we not have a deficit if $5,000m? There is nothing wrong with it at all’. Let honourable senators opposite go back to what the Labor Government said in unqualified terms -
– Nobody ever said anything like that. Why do you not tell the truth?
– The honourable senator will get his chance. If he can devise from what Mr Hayden said other than what I have interpreted it to mean, let him get up and say that that is so, because Mr Hayden was talking about the previous deficit which had been $2,500m and he said that projected it would have been nearly doubled.
– Who said anything about $5,000m?
– He said it would be $5,000m.
– We all agree it should be reduced.
-It is interesting that Senator James McClelland says: ‘We all agree it should be reduced’. His Government of the day and he agreed that it ought to be halved. That is what he said. We are cutting $2,600m, or half, from it. Indeed, for once in our lives, we have a community of viewpoint.
-We have unanimity. On our part it is unanimity of action; on the part of the Opposition it is unanimity of words. That is the basis. Let me ask again: Are honourable senators opposite opposed to the family allowance? Are they opposed to tax indexation? What are they opposed to? Are they opposed to cutting $2,600m out of the forward estimates? Are they? I hear no voice. Silence is an interesting reply. What are they opposed to? Are they opposed to cuts in welfare? That is exactly what they did last year. Really, now, we are getting down to the question: What are they opposed to? This is a fascinating situation. Here we are engaging in a debate concerning action by the Government to try to do something to overcome the tragedy of the Labor Party which in government produced more unemployment than Australia has ever known except in the years of the great depression. It produced more inflation than has ever been known in Australia. It demolished home ownership. Labor senators now say: ‘We are opposed to doing things to restore economic stability! (Opposition senators interjecting)
– They roar. They were silent when I put the test on them but now they roar in loud decibels but without too much intellect attached to their sound. Let me come to what we have done. We have introduced a family allowance and tax indexation. We are putting into the pockets of the taxpayers and workers more real money. We are giving to the real poor more real help. But we have said to the people of Australia: ‘We will give you improvement in education’.
– What about Medibank and what you propose there?
– We have gone one step further. We have said to local government: ‘We will give you a new deal.
– What about the cuts in the railways?
– What about some order, Mr Acting Deputy President?
The ACTING DEPUTY PRESIDENT (Senator McAuIiffe)- Order! I take that to be a reflection on the Chair. I heard in a female voice on my right the words: ‘What about some order?’. I am quite capable of keeping the Senate in order. I do not think that at any stage its proceedings have got out of order. This is just a lively debate. When you have more experience in the chamber, Senator, you will appreciate that.
– I am sorry, Mr Acting Deputy President.
– Let me say that nothing encourages me more than -
– We do not want any more of that experience.
The ACTING DEPUTY PRESIDENT-
Order! Senator Wright, will you show some respect for the Chair? You have been a senator long enough to -
– I rise to a point of order, Mr Acting Deputy President. I said: ‘We do not want any more of that experience’.
The ACTING DEPUTY PRESIDENT-
– I wish to make a respectful submission to you. I submit that we should have a decent standard of order so that we can hear the speaker.
– I rise to speak to the point of order. It is evident to everybody in this place that Senator Carrick intentionally and purposely baits the Opposition.
Government senators- Ah!
– Of course he does. He is aggressive. He distorts arguments. I referred to his answers to questions yesterday. When he gets an interjection, he, or one of his colleagues, complains. I believe that he does not mind that sort of interjection. I presume that he does not. I do not think he needs his colleagues to back him up. We receive the same treatment on occasions.
The ACTING DEPUTY PRESIDENT- No point of order arises. I am guided by the ruling of a previous President that this is not a place for shrinking violets. Senator Carrick is quite capable of looking after himself. I think what has happened has added to and not detracted from this debate.
– We contest whether I bait the Opposition. I did not know that Opposition senators were tender violets. If that is so, let them restrain themselves in due modesty and silence and I will continue my contribution to the debate which was addressed entirely to you. Sir, in -.proper Senate form, as I think you will acknowledge.
The ACTING DEPUTY PRESIDENT- And, as far as I was concerned, in order.
– That is absolutely right. Trying to deny time to a speaker on his feet by raising points of order is an old and shabby trick. That ought to be known.
I was saying that, amongst the great reforms together with tax indexation, the family allowance and education growth, was the introduction of an entirely new deal for local government. When on Monday representatives of local government as a deputation representing all local governing bodies in Australia came to me, they said to me in an entirely unqualified way that they wanted to pay tribute to the federalism policies of the Federal Government which they acknowledged as a major and enduring reform for local government in Australia. Indeed, what we said we will do we have now done. We have said that we will give to local government, to all councils in Australia, direct per capita grants and that we will also give another portion through the State grants commissions for equalisation purposes to assist in topping up and in times of need. We have done just that. So in comparison with the $79.9m allocated by the Whitlam Government for untied grants to local government we have given this year $140m in untied grants, an increase of 75 per cent. The only rejoinder that the Opposition has is: ‘Yes, but you might be reducing some special purpose grants’. Let honourable senators opposite wait and see but this is a comparison of untied grants.
I remind the Opposition that last year it caused mayhem by its reduction of special purpose grants. Did it complain then? Did Mr Neilson, the Premier of Tasmania, complain when $ 105m was cut from special purpose grants for education? No. lt is all right for a Labor Federal Government to cut special purpose grants but let a Liberal Government exercise its rights to control its own programs and the voices go up. What we have done for local government is profound. We have given local government a fixed percentage of personal income tax so that in the years ahead it will know with certainty and without any question of political decision-making the quantum of money it will get. Local government will know that its revenue supplement will grow at the same rate as Commonwealth revenue, that it will be able to plan ahead, that it will be able to abate the increase in rates in the future and, therefore, will be able to expand. On top of that we are proposing to set up a council for intergovernmental relations on which Federal, State and local government will meet for the first time as 3 spheres of government along with community representatives as equals, as partners, and not as inferiors or puppets of Canberra. They will meet as equals around the conference table to discuss the full problems of the nation.
Local government bodies throughout Australia have paid great tribute to this move. Ours has been the Government which has given local government recognition of its growing importance and has given it the opportunity to expand. I repeat that if there is to be one major reform for local government it must be the reduction of inflation in Australia. The last 3 years have seen local government face enormous difficulties with its budgets in respect of bc recurrent and capital expenditure because of erosion due to inflation. Many councils throughout Australia put up their rates by 35 per cent or more and the handouts they got from the Commonwealth were nothing compared with the erosion of income by inflation. In other words, the Commonwealth handouts were small compared with the robbery due to inflation. This Government says to local government: ‘Work with us to reduce inflation. We will help you. We will bring about tax indexation. We are going to index taxes so that in the long as well as the short run the upward spiral of your wages bill will be abated and your costs will be controlled. Interest rates which have been soaring will be moderated and local government will have restored to it the ability to plan, the ability to forward budget and will know that it will get from the Commonwealth Government a fixed percentage every year. ‘
Let me draw this together. We were put into government to bring about economic stability following the economic chaos created by the previous Government. We have set out to do so and have made an economic statement. We have said in that statement that we will do a number of things. One is tax indexation which the Labor Party says it supports and another is family allowances which the Labor Party also says it supports. Then there is the cutting back of the prospective deficit in a forward estimate which Mr Hayden and his party have said they support and which the interjections from the Labor Party senators acknowledge to be right. We are cutting it back by half which Mr Hayden has said had to be done. Then we come to the question of what to cut. Honourable senators opposite say with tears in their eyes: ‘You must not cut welfare expenditure’. I gently remind them of a little matter of $105m pruned off the education budget last year. It has been conveniently forgotten. Honourable senators will remember that the former Government said on E-day, ‘Do not cut schools’ on education day, and cried its eyes out, cut $43m off the schools budget last year. We have gone ahead and increased the budget.
Where does this party in disarray stand? It is in favour of tax indexation; it acknowledges that. It is in favour of family allowances. It is in favour of the massive reduction of the deficit in a forward estimate. It acknowledges by its actions that there have to be significant cuts in welfare programs and that when faced with this it went to specific purpose programs and hacked them to pieces. If it acknowledges all these things, where do its arguments stand other than in glorious disarray? I believes that the Australian people will come to regard the statement made last Thursday night as one of the most forward thinking, most courageous and most accurate documents and programs in Australia’s history. They will come to recognise that the great social reforms, as always, come from parties of Liberal faith.
They will come to realise that only Liberal governments stand for full employment and low inflation.
– Listening to Senator Carrick one might be excused for getting the impression that his Government already had turned on the lights. Of course, the fact is that it is still groping in the dark for the switch. I would like to comment briefly on what has been variously called the Government’s mini-Budget or the Lynch economic package with special reference to why Mr Lynch ‘s sermon on the mount, as it has been almost dubbed by Senator Carrick, came to be made at all. I believe wholeheartedly in the primacy of the fight against inflation. It cannot be separated from the fight against employment. Last year as Minister for Labor and Immigration I spent a lot of time and effort trying to convince unionists that not only was it against the interests of the nation but also against their own interests if they sought wage rises of such dimensions that they created a pressure on prices which ultimately had the effect of eroding their wage increases and making them illusory. I never, by the way, suggested to unionists that they should accept a cut in real wages.
I think I can claim some modest success for these efforts. Average weekly earnings in the year ended December 1974 increased by some 28 per cent. The increase in average weekly earnings in the year ended December 1975 was only 10 per cent and inflation came down from a peak of 17.6 per cent to 13 per cent. I also believe, in accordance with the acceptance by my party of the notion of a mixed economy in which the health of the private sector is a pre-condition for the provision of services by the public sector, that the profit level, especially in the manufacturing section of our society, had sunk to a point where retained earnings were not sufficient to provide the necessary investment to preserve competitiveness and safeguard jobs. I believe that unless inflation can be pegged back there can be no serious or permanent diminution in the level of unemployment. But the fight against inflation depends above all on the establishment of a broad social consensus. The important pressure groups in our society will not co-operate if they believe that they are being got at- that they are being asked to carry more than a just share of the burden of our present social malaise.
I believe that the Government has been particularly hamfisted in its attempts to obtain the co-operation of the trade unions. I want to make it quite clear that my criticism is not directed towards my successor in the labor portfolio, Mr
Street. I think that he has been flexible and receptive and that he is trying very hard to fulfil the demands of what I regard as the most exacting portfolio in a modem government. I cite an incident. During the general election campaign Mr Street and I took part in a television appearance on Monday Conference. It was taped- it did not go live to air. We sat down afterwards and watched it being shown. I had a conversation with Mr Street and among other things I said to him: ‘I believe you people are being very shortsighted if you think that you are going to be able to persuade the unions to accept continuing wage restraint and at the same time tell them that you propose to abolish the Prices Justification Tribunal. This will be seen by the unions to be saying to them: ‘You tighten your belts’, but to be saying to the employers: ‘Bob’s your uncle, charge whatever you like’.’ The very next day Mr Fraser backpedalled on his promise to abolish the Prices Justification Tribunal. I like to believe that Mr Street, after listening to me, went to Mr Fraser and told him that he was being stupid, and Mr Fraser listened.
Similarly in the matter of the trade union ballots. According to the benighted lights, I believe, of the Liberals in the matter of trade unions- one would believe sometimes that they had never met a trade unionist- they had this magic formula of secret postal ballots that were supposed to solve all the problems of the trade unions and of the community, to get rid of troublemakers and to free unions of militants like Halfpenny and Carmichael. This was all based on an illusion. It was based on the notion that if a higher percentage of members of trade unions were persuaded to vote they would not vote for militants. That is an unwarranted assumption and it is one that could be based only on total ignorance of the nature of the trade union movement. To his credit, Mr Street also finally, I believe helped by my nagging, saw the folly of this and in the interests of trying to come to some sort of an arrangement with the unions- without which this Government will not be able to govern- dropped this idea, for which the returns would have been miniscule and which could have involved the country in an unnecessary confrontation. So I say- and I say this wholeheartedlythat 1 believe that Mr Street has made a good job of his attempts to carry out a most difficult task, but I fear that his best efforts are often steamrollered in Cabinet. 1 know from my own experience that that is where the real fight takes place.
Let us examine the Treasurer, Mr Lynch ‘s package in the light of the Government’s promises and its record. During the election campaign Mr Fraser promised, firstly, that he would maintain wage indexation. He made no qualification of this promise. He did not say that he would maintain it perhaps, or that he would maintain part of it. We on this side of the chamber face the fact realistically that a great number of trade unionists must have supported Mr Fraser or else he would not have been able to get the thumping majority that he got in the election. I believe that one of the crucial ingredients in the faith which the unionists placed in Mr Fraser was that they believed he would maintain wage indexation in the same way as the previous Government had declared its unequivocal support for wage indexation. But what did we see? At the first national wage hearing after the new Government came to power Mr Fraser sent counsel along to the Conciliation and Arbitration Commission to ask it to give half wage indexation. His reasons were so flimsy, so inept and so hamfisted that the Conciliation and Arbitration Commission almost humiliated the counsel that he sent along to put this phoney unsupported argument. But this was the first lesson in disillusionment that the workers of Australia who had voted for Mr Fraser- who had put their faith in him- had about what an election promise meant to Mr Fraser.
Some reference has been made today to Mr Fraser ‘s appearance on Monday Conference this week in which he said, in effect, that an election promise made in the course of an election campaign of course is not to be taken seriously. This was the first lesson that the people of Australia had about what a promise meant to Mr Fraser. He also said that he would maintain Medibank. He did not put any qualification on that. He did not say that he would emasculate Medibank. He did not say that he was in favour of 2 types of medical scheme for Australians.
– He did say he would review it.
-There was no qualification upon his promise, and I suggest that the honourable senator reads Mr Fraser ‘s election speech. I suggest, in fact, to every member of the Liberal and National Country Parties that he go back and reread the election speech of Mr Fraser. But as we know from the Lynch package, Medibank as we understood it- as everybody in Australia understood it- is destined for destruction, and some sort of an emasculated version of a national health scheme will be introduced.
– Absolute rubbish!
– I trust that we shall hear from Senator Walters in due course. She interjects in this way every time that I, at least, speak. But I never notice that she jumps into the list of speakers to refute me when she gets the opportunity. So I suggest that she show a little bit of respect for the forms of the Senate. I suggest that unionists will regard as a betrayal this part of the Lynch package relating to Medibank. I talk about this in the context of what I believe to be at the heart of modern government- that is, the search for a social compact, the necessity to convince the powerful sections of society that the Government is not ripping them off or favouring any other section.
We come now to tax indexation. Senator Carrick in his style of twitting the Opposition in what he thinks is a damaging way put to us the question of whether we support tax indexation. Of course we do. In the Cabinet discussions of last year I attempted to sell the idea of tax indexation but I was convinced- and I believe that those who convinced me were correct- that the revenue at that stage could not stand tax indexation. Let us have a look. Really, the surprise of the Lynch package is the promise to implement full tax indexation from 1 July. It had been promised over a 3-year period, but Mr Lynch says that it is to be introduced in one fell swoop to get, and I quote him, ‘the Government’s hands out of taxpayers’ pockets and for wage policy reasons’.
As I understand it, the proposition which the Government is attempting to sell to wage earners is this: With tax indexation wage earners will not move into a higher taxation bracket in the year commencing 1 July 1976 and therefore they should be content with wage increases something less than the rises in the consumer price index. This is the burden of the submissions that the Government put to the Conciliation and Arbitration Commission. Mr Lynch himself has stated that he wants to see increases in wages something less than the rises in the CPI. Admittedly, Mr Fraser on Monday Conference the other night gave a different impression. But the fact that they speak in different tongues should not blind us to the fact that on serious occasions, and in the important propaganda statements that they make they advocate a wage indexation of a different kind from the one that we espoused and which the workers bought, that is, rises which fully compensate workers for increases in the cost of living. The proposal which is being put by the Government in alliance with tax indexation still amounts to asking workers to take a cut in real wages.
Nobody believes that inflation will disappear on 1 July merely because tax indexation commences from that date. Prices will continue to rise, though it is hoped by us as well as by the Government that they will rise at a lower rate than the current rate of some 13 per cent per annum. So even when a taxpayer’s income tax bracket has been adjusted by indexation he will not keep pace with rises in the cost of living unless he receives full wage indexation also. Yet the Government is attempting to sell workers on the idea that because their taxes are not increased as a result of tax indexation, they should accept a cut in real wages by accepting something less than the amount necessary to compensate them for rises in what they must pay for goods. There might be some justification for this if tax indexation meant a decline in actual tax paid. But this is the case only for those whose incomes do not increase in money terms in 1976-77. Nobody, not even the Government, is suggesting this. I submit that it is a confidence trick to tell workers that tax indexation is a reason why they should not have full wage indexation. They should be told the truth.
Even with tax indexation, not to mention indirect tax increases which are inevitable to fill the $ 1,300m gap, to which I will advert a little later on Mr Lynch ‘s story, the Government proposes a fall in the worker’s standard of living. We must add to this the fact that the benefits of tax indexation will be more than wiped out, as Senator Bishop has pointed out, by the Medibank levy. I fear that the Government’s plans to reinforce its attempt to reduce real wages are based on a plan to maintain for a lengthy period a high level of unemployment. This is in face of the fact that there is no persuasive evidence from any modern country that high unemployment does achieve such an end, quite apart from the morals or the humanity of the problem.
Let us look at this as a technical matter of economic management. I repeat that there is no evidence that high unemployment has any real effect on the level of inflation. Let us look at the period ahead. It is notorious that because of a variety of reasons there has been a very serious drop-off in the number of young people prepared to take up apprenticeships. There will be a decrease over the years ahead in the number of tradesmen. At the present time we do not hear of tradesmen being out of work. The unions with muscle are mostly unions of skilled workers. If they believe that they are not getting a fair go, if they believe that they are being ripped off in some way, the existence of an increasing pool of unemployed will not in any way affect their determination to get what they think is a fair wage. So the existence of this unemployment pool is not only inhumane but also it is bad economics.
I do not want to use extravagant language in commenting on the Government’s aspirations to reduce the forward estimates by $2,600m. There is a little bit of a mystery here. We are not told anything about these forward estimates. It is a secret which is hugged to Treasury’s bosom. We do not know whether there is a genuine plan to reduce the forward estimates by $2,600m. However, it is an impressive figure which is plucked out of the air. I understand, and I sympathise with, the Government’s efforts to get the deficit down. In passing, while we are talking about the deficit, I refer to what the Melbourne newspaper the Age calls the ominous mystery of the missing millions. If we read Mr Lynch ‘s statement carefully we find that he gives details of only $ 1,300m in cuts. I do not know what this means. I do not know whether he is just living from day to day and hoping that the statements he makes will have some effect without having any ‘real plan to reduce the deficit by $2,600m.
Senator Carrick, who had a lot to say about this matter, did not throw any light on it. Maybe the leeway will be made up by some savage indirect tax. However, we are still left in the dark. Despite the extraordinary fact that the Government saw fit to introduce a mini Budget 3 months or 4 months before the real Budget we still do not have the full picture. I suggest that the reason for that is that the Government, as with most other things, still does not know what it is doing. The areas in which these cuts of $ 1,300m will fallwhatever else there is to come- were outlined by Mr Lynch and include environment, housing, community development, transport, construction, etc. Unless something else is going to happen, to which I shall refer later, these cuts mean, at least to put it no higher, that there will be no contribution in the year ahead from the public sector to the absorption of the unemployed. Any improvement in the unemployment figures must depend on growth in the private sector. In this matter Mr Lynch had a few guardedly optimistic words to say. He stated:
There are sufficient signs now for believing that economic recovery is under way, though it is at an early stage and will of course require careful nurturing.
I hope he is right and that there is some light at the end of the tunnel. But there are other voices which give different messages. Notable among these voices is the Australia and New Zealand Banking Group Ltd which is not notoriously proLabor or notoriously anti-Government. In its May issue of a bulletin which it puts out about these matters and which was issued before Mr Lynch made his statement- before his sermon from the mount- it stated:
While patchy and uneven recovery is evident in some areas of the economy, future growth prospects are little clearer than they were a year ago. Currently, some forward indicators, such as the employment advertisement series, suggest a further hesitancy may be emerging. This is unfortunate from the Government’s point of view as it is having the effect of bringing pressure to bear on the policymakers for an interim announcement indicating their line of thinking in the formulation of the August Budget.
How right this bulletin was. This is the purpose of Mr Lynch ‘s statement. The Government is gambling on a boost in business confidence. We remember that this boost was supposed to emerge like a light on the hill immediately the wicked socialists were thrown out of office and a government of sensible economic management emerged. This was a promise which was not fulfilled. Business confidence turned out to be a much more fragile and difficult thing to stimulate than our saviours of 13 December would have us believe. Of course, this is the reason for this statement. It is an attempt to say to the business community: ‘Things will be better in the private sector because we are pruning public sector expenditure in the ways we have announced’. This is an enormous gamble. There is no evidence that it will work.
There is another possibility that we have to take into account. Maybe this whole grand design of a reduction in public spending is all a sham. The whole plan to boost the confidence of the private sector by appearing to cut back public expenditure may turn out to be a snare and a delusion. We will know more about this after the Premiers Conference in June. As was touched on by Senator Grimes, if the Government cuts back its payments to the States, for example in specific purpose grants, while allowing them to place their own levies on income tax- nothing that the architect of the new federalism, Senator Carrick, has said today or on any other occasion indicates that that is not what is involved in the Government’s scheme-State income taxes could substantially increase and finance what would really amount to a transfer of spending functions to the States rather than an overall reduction in Federal and State spending.
Similarly, if the Australian Loan Council were to agree that the States could make up for the cuts imposed on them by the Commonwealth by raising loans in the market, a cut in the Federal deficit would not result in any reduction in total public sector demand for resources. This would be a real thimble and pea trick in the best traditions of Fraserian political morality. We would then be treated to the spectacle of Mr Fraser and Mr Lynch boasting of their fiscal responsibility and pointing to their healthily reduced deficit. But overall there would be no real reduction in public spending. In fact, there might be an overall increase. I hope that I am wrong; I hope that I am being over-suspicious. I hope that the Government does not have this in mind. But having watched it in its brief but far from glorious performance so far, I fear that we may be on the verge of being sold such a pup. The whole exercise may well turn out to be just a bad joke. Having persuaded a majority of the people last year that the Labor Government was so bad that anything else must be better, they got away with a real confidence trick. They really have no idea of how to turn on the lights. As I said earlier, they have stumbled around in the dark trying to find the switch.
Their business supporters and the community generally began to get restive. That has been demonstrated by, among other things, the result of the New South Wales election, which I know came as a real kick in the teeth to the architect of the new federalism, Senator Carrick, who was prepared to bet me on the day before the election that nothing remotely like that could be possible. We all know that Mr Peacock learned a little about the facts of life when he attended a business luncheon in Melbourne some weeks ago, hoping that everybody would be scratching his back and telling him what a wonderful light turning-on government the coalition had become, only to find that the attitude of the assembled gathering was quite different. He found himself with his guard up, attempting to ward off the blows of business, this business which was so suddenly to become confident with the return of a new government and the turning out of the wicked socialists. The magical return of business confidence just did not occur, and Mr Fraser was then in a dilemma. He had played Churchill to the Australian people, promising them blood, toil, tears and sweat, playing the tough man, only to find that the net result was that he was undermining consumer confidence. If people were promised such a grim future they were not going to open up their pocket books and go out and buy refrigerators and television sets.
After a while the Treasury had to convince Mr Fraser that he had to jawbone the Australian people into buying consumer goods. That was when he gave his famous message that the Budget and the financial plans he had ahead would not be hard on the Australian people, they would be hard only on the Government. This reminds me of a famous remark of Sir Robert Menzies who said that, contrary to public opinion, the Government has no money of its own. Mr Fraser, with the quaint household economics with which he sometimes regales us, seemed to think that he could persuade us that the fiscal measures he had in mind would be hurtful to him, hurtful to Mr Lynch, hurtful to Senator Carrick, but would be gentle on the pocket so that people should go out and buy. Unfortunately, this naive attempt to jawbone the public into disregarding his previous Churchillian warnings is not working either, hence the Lynch package. That is the real reason we were regaled with this hotchpotch the other night. I am afraid that this package reminds me of one of those packages where you peel off layer after layer of wrapping, only to find there is something very small inside.
– I find myself in agreement with Senator James McClelland about the necessity to fight against inflation so that we will be able to overcome unemployment. I believe that that part at the beginning of his speech set into motion the things that need to be said again and again by speakers from the Government side because that is what the fight is all about. It is a fight against inflation so that we can overcome the unemployment which exists in our community. I found it somewhat remarkable to hear the former Minister speak of wage indexation in the terms in which he did. While I acknowledge the efforts he made with regard to wage indexation during the fading stages of the Labor Government, he did not tell the Senate today what his own attitude was to indirect taxes and the need to discount them when we talked last year about wage indexation. He laid great emphasis on indirect taxation, but when he spoke today of full wage indexation he omitted to tell the Senate of his own attitude as a responsible Minister at that time.
I think it should be said that this Government’s attitude to wage indexation walks closely with its attitude to tax indexation. Unlike the former Government, we recognise that tax indexation is an important part of wage restraint. The honourable senator decried the fact that the Treasurer (Mr Lynch) announced that notwithstanding that the Government had said formerly it would phase in tax indexation over a 3-year period, it is now able to introduce total tax indexation this year. It is important in the control of wage demands that tax indexation is recognised as a restraint. The former Minister said that tax indexation will not have the effect the Government said it will because of the Government’s representations to the Arbitration Commission in connection with wage indexation. I think that the honourable senator is not joined by all members of the Australian Labor Party in his attitude to full wage indexation as he terms it. Notably, members such as Mr Jack Egerton have stated opinions with regard to wage indexation right across the board, at all levels of income. When one speaks about the containment of inflation, it should be recognised that wage indexation at all levels of income is not the quickest way by which to reduce the inflation which is causing the present unemployment.
Senator James McClelland referred to a technical matter of economic management, and it should be recognised that in that technical matter the former Government failed abysmally and its record was deplorable. The inheritance of this Government was a great necessity for sound economic management and, in the Treasurer’s statement last week, we endeavoured to set part of the pattern on record. This is not the time at which we introduce a total Budget. This is the time at which we point to the direction of economic management that we believe needs to be recorded. The honourable senator spoke of public sector spending and wondered whether this was to be reduced and the effect it would have on business recovery. It has never occurred to members of the former Government that personal spending is a way in which consumer recovery, business recovery, can be undertaken. The only sort of spending with which the former Government wished to be involved was public sector spending. Instead of doing that, this Government has recognised that there are people who wish to make their own choices, represented in the spending that they undertake, and that through tax indexation and the family allowances personal spending will be considerably enhanced in the next few months. We believe that this will be one of the ways in which we can have a consumer recovery and link that with an investment recovery and a total economic recovery.
The Treasurer has said that there are signs that economic recovery is under way. However fragile they may be, with all the tensions that exist at the present time, I think that personal spending and a regaining of confidence by the people, who know that sound economic management is part of our responsibility, will ensure that there is a recovery sooner than otherwise could have been expected. Senator James McClelland referred to many things which touched on the broad social consensus between trade unions and people and government which need to be stated. If there is to be the economic recovery desired by all thinking Australians, that concensus needs to be treated very seriously. I was pleased to hear Senator James McClelland ‘s acknowledgment of the fine record of the Minister for Employment and Industrial Relations (Mr Street) and the cooperation he has already achieved in this very sensitive responsibility. It was said also by Senator James McClelland that State income taxes would be levied. He obviously has not been listening to my colleague Senator Carrick when he has explained repeatedly the new federal-State financial relations which will be undertaken. He has said specifically that the States will not have the capacity to levy taxes in the first year of the new plan.
Senator James McClelland and other members of the Opposition should contain their impatience until the Budget is delivered- which will be following financial talks between the Premiers, State Treasurers and the Federal Government- when announcements will be made of the totally new federal-State financial relationships and all the implications of them. I believe that at the time of the next Budget the country will be showing greater signs of recovery than it shows at this stage. We have put on record our objectives with regard to government spending. I think we can see that many of the problems which are of great concern at present to us as a government are gradually being overcome.
I want to use this opportunity to say something about those things which are my direct responsibility and in particular to speak of the assistance for families which was announced in the measures outlined last week. It is important at this stage to say that it is our philosophy that welfare assistance should be directed to those people whose needs are the greatest and that it should be directed in a way in which we enable people to become more independent and to exercise their own choice and their own responsibility. Consistent with this philosophy, the new system of family allowances will give great assistance to the families in this country. It represents a major improvement in the Australian social welfare system and it improves the situation of those families who are most in need. We have devised a system in which we are now able to give to every child in this country the same measure of support.
The new system is quite a simple one. It is based on giving large non-taxable increases in family allowances to all families. This will be offset by abolishing the tax rebate system. We abolished the tax rebate system because we were aware that about 300 000 families in the lower income group in this country would not take advantage of the tax rebate scheme. We recognised that there were about 800 000 children in these families and realised that the whole system of child endowment needed to be restructured so that assistance could be directed to all children and to all families. The new family allowances scheme will cost $ 1,020m a year. This is an increase in family allowance of $785m, which is the amount that was represented broadly by the tax rebate system. Instead of some families being able to take advantage of a $200 rebate for the first child and a rebate for other children, the same allowances will be made for all children.
We were influenced in this decision very strongly by the poverty report of Professor Henderson which talked of the way in which we could direct assistance to families by abolishing tax rebates, thus enabling a larger amount to be distributed amongst the children in Australia. The recommendations of Professor Henderson have been very significant in the way in which we have developed our system of family allowances. For the first, second and third child we have given a greater allowance than was recommended by Professor Henderson. Perhaps at this stage we have not accepted the level of allowances which was recommended by his report for the fourth child and subsequent children. We were influenced by the figures relating to families which have one to three children. The number of children in families which have one child totals 668 000; in families with 2 children, 730 000; and in families with 3 children, 352 000. This makes a total of 1.7 million children. The number of children in families with four or more children total 1 74 000. It was a case of looking at the families which could have the greatest benefit. We realised that 1.7 million children would benefit from the greatly increased allowances we gave. We also gave heavy increases to those families with four or more children. The new allowances are $3.50 a week for the first child, $5 for the second child, $6 for the third child, $6 for the fourth child and $7 for each child thereafter.
Significantly too we have been enabled to introduce a greater benefit for student children. In future they will be treated on the same basis as other children in the family. Whereas at present endowment for a student child is $ 1 .50 a week, in future it will range from $3.50 to $7 a week depending on the position of the child in the family and the number of children in the family. In future the endowment allowance for student children will continue until 25 years of age. I believe the level of allowance we are giving will be be of great benefit to many students throughout this country.
I want to say something about the date of payment of these allowances. It is important to make this clear. The first cheques will be paid for the new allowances to those people who normally would receive their endowment cheques on 13 July this year. Because of the numbers of people who are given cheques for endowment the payments are split into fortnightly groups so that the workload of the department is spread. The first increase will reveal itself on 29 June. Other people will receive endowment payments on 13 July 1976. People who have their endowment paid into banks at 3-monthly intervals will have the increase paid on 7 September. We are having talks with the trading banks and the savings banks at present to see whether they will accept monthly credits. We believe many people would desire to have these larger sums of money paid in this way. It has been the practice that credits to banks have been made at 3-monthly intervals. Because of the level of support and the desirability for these allowances to be in the hands of the parents responsible for the children, we think that a monthly payment would be desirable. We have instituted talks with the banks to see whether they will accept this method of credit payment to bank accounts. We will still make cheques available at 4-weekly intervals. In that way we will enable as many people as possible to have earlier access to the funds that are available to them.
We took the opportunity also to adjust some provisions with regard to nationality qualifications to give effect to certain children with alien fathers who were excluded from eligibility for child endowment. I think this is one matter that needed to be dealt with at this time because of the decision to abolish taxation rebates to these people. What is important to me and to my department is that the new benefit will be a help to those families where there is a single breadwinner or perhaps where there is a single parent looking after children. The lower income families, as I mentioned before, who could not take advantage of the tax rebate, will have this immediate extra support directed to them. They will have support in a way which will enable them to determine how they will meet the needs of their children and to decide the priorities which they will give to this expenditure.
Opportunity was also taken to increase the rebate which is allowed for a spouse who is dependent on a taxpayer. The amount will be increased from $400 to $500. Increases will also be given to sole parents. Their rebate will be increased in a commensurate way to overtake the difficulties that they experience. In all these ways we are hoping that this will be one very positive step towards the alleviation of poverty for the 300 000 low income families whom I mentioned. We believe it is a major step forward in the Government’s objective of directing welfare payments to families whose needs are the greatest.
There were other proposals from my Department. One referred to the Commonwealth Rehabilitation Service. An allocation of $13. lm for next year was announced. This is a very important Budget item as far as I am concerned. I regard the Rehabilitation Service as one of the most positive means of enabling people to reach independence and to have security while they are doing so. We were pleased that we could maintain our assistance to handicapped persons, through the organisations which assist them, and could continue the $30m which had been provided under the program this year. Equally we were pleased that we could maintain our support for the homeless persons assistance. The subsidies for aged persons homes and hostels had particular attention in the matters which were revealed by the Treasurer last week. We were aware of the very many aged persons who were requiring home and hostel accommodation. The Government has decided to introduce a 3-year program to deal with the countless applications which we have received for support. We have provided for that 3-year program $225m. We are hopeful, having announced that 3-year program, of being able to move forward to giving approval to many organisations to proceed now with buildings at present day building costs, allowing them to use funds which they have already accumulated as their proportion of the projects for which approval will be given. We believe that to allow $45m, which we have set aside for this year, will allow a great deal of building to commence and to progress. We are hopeful that in 3 years we will be able to use the $225m or to extend the scheme into a fourth year if all that sum is not able to be used because of building requirements or any economic necessities that need to be taken into account.
Other matters which affect my responsibility were referred to in the statement. In particular I refer to widows, supporting mothers, unemployment and sickness benefits. It will be understood by many people that a decision was taken that the payments under widows pensions and supporting mothers benefits will be included as income for taxation purposes. I want to explain that this does not mean that any person whose sole income is a pension or a benefit of that nature will be taxed on that benefit, but rather we have decided that no longer can these benefits be regarded as exempt income for taxation purposes. It is important to state this because, with the tapering of the means test and allowable income which these beneficiaries are allowed to have, many of them come within the normal taxing bracket of income at which every other taxpayer is paying tax on income. This would be so particularly in the case of those who receive unemployment benefits. They may, for a certain number of months in a year, have income of that nature and may then proceed to earn normal income from personal exertion. In the case of widows and supporting mothers there may be income from investments or from personal exertion. When such persons reach the level of income at which anyone in the community is taxed, it seemed they should also be taxed. It seemed to be a matter of equity that this provision be introduced at this time. Mr Acting Deputy President, I have a table which shows the after tax income of widows and supporting mothers. I think it would be appropriate to have it included in Hansard. It shows the basic pension, the non-pension income, the taxable income, the non-taxable allowances and the family allowances under the new program. I think it would be of interest to the Senate. I ask that it be incorporated in Hansard.
The ACTING DEPUTY PRESIDENT (Senator Young)- Is leave granted? There being no objection, leave is granted. (The document read as follows)-
– I thank the Senate. The other matter to which I wish to refer is the Australian Assistance Plan. I do so because of the interest in it and of the decision which was taken by the Government with regard to it. It would be known to all honourable senators that this was a 3-year plan and that the program was to conclude on 30 June. The Government has announced that it is a program which the Government feels is more appropriate to be dealt with at State government level. For this reason the decision has been taken to fund those employed under the Plan for a further 12 months, and to complete the projects which are in the course of progress at this time. The Commonwealth Government will make available $3m to pay for staff salaries and administrative costs of staff employed, and $2m for the projects to which I referred.
Sitting suspended from 6.1 to 8 p.m.
– Prior to the suspension of the sitting of the Senate I was speaking of the arrangements made for the continuation of the Australian Assistance Plan. I mentioned the grants which were available for the staffing and administration arrangements and for the projects which were incomplete. In addition to this the Commonwealth Government will make available officers from the Department of Social Security who have been involved in the development of the Australian Assistance Plan to date to assist State governments in whatever way possible over the next 12 months and beyond as they develop their own plans for the future of this program. Any of the material which has been produced arising from the evaluation that has taken place will be made available on request to any of the State governments which require such material.
Also, the Australian Assistance Plan will be listed as an item for discussion at the forthcoming Federal-State financial relations discussion as one of the programs for absorption by the States against which future financial arrangements will be discussed. The Prime Minister (Mr Malcolm Fraser) will be writing to all State Premiers in these terms conveying the decision outlined. I feel sure that these transition arrangements will enable any State which wishes further to develop the Plan to do so. We hope that this will be a satisfactory means of ensuring that this pilot program is continued and that the experience gained will be used to the benefit of community development.
-The Senate is debating the Government’s economic statement delivered last Thursday night. Insofar as that statement represents an attempt to grapple with inflation, it is welcomed by honourable senators on this side of the Senate. Insofar as it seeks to assist poorer sections in the community and to make increased child endowment payments- carried out on the recommendation of the Henderson report- the statement is also welcomed by the Opposition. It is not our task as an Opposition to condemn everything that the Government does. We hope that it will be successful in reducing the rate of inflation as a result of its package of economic measures. But it is our task to point out certain risks in the strategy which the Government is following and to point out particularly that we believe the strategy is misguided in that it will not solve the problem of the high level of unemployment which exists in our society for a variety of reasons which are related to that question.
Since the Government came to office, we have had nearly 6 months of vaccilation on the nature of the economic recovery which it seeks to encourage. We were told early in the year that the Government relied on an investment led recovery. We were told that in the context of massive commitments in the form of the investment allowance. More recently we have been told that the recovery must be a consumer led recovery or, more particularly, a combination of both because it has now been realised that consumer spending is a key factor in investment. The adoption of both these strategies, which have been brought together in various statements made by the Leader of the Government in the Senate (Senator Withers) in the last few weeks, to an extent, we would say, probably represent a more correct view than that adopted earlier. However, throughout the whole of the strategy there are as we see it 2 basic problems. The first is that of unemployment and the second is that of the Government’s announced policy of reducing the level of real wages in the community as a measure to tackle inflation.
There seem to us to be certain warnings in this. First of all, with regard to the level of real wages and the fear not of unemployment itself but the prospect of it, we regard both these matters- that is to say, a threat to the standard of real wages and a threat of unemployment- as being very powerful psychological factors which are likely to inhibit and limit the level of consumer spending in our community. There is nothing which acts as a more powerful stimulus to reduce consumer spending than the threat or the possibility of losing employment. There is probably no more powerful threat than that against the desire and the capacity to spend freely. We see that as a very important factor to which the Government has not given sufficient attention in its overall economic strategy. When one adds to that the cuts which have been made in government expenditure in a large number of areas, we feel that that again is an inhibiting factor on the capacity and freedom of individuals to spend. We believe that these steps have been taken- of course, it is quite clear that this is the casebecause of a pre- occupation with the size of the deficit. This pre-occupation has loomed large in the statements of Government Ministers since the caretaker Government took over in November of last year. We do not believe that tax indexation, to which I will refer later, unemployment or the reduction in real wages will help solve the problem of the size of the deficit and the pre-occupation with it which clearly exists in the minds of Government members.
I turn now very briefly to the question of tax indexation which, of course, is part of the Government’s economic package and which has been foreshadowed in statements for a long period of time. It is suggested first of all that tax indexation will remove the pressure for wage increases from Australian trade unions. Of course, that might have been so if the tax indexation package had not been accompanied by suggestions that the Government is seeking to reduce real wages and is opposing full wage indexation in the Conciliation and Arbitration Commission. We believe that it is just not likely that there will be a sufficient response from the unions in relation to the promise of tax indexation and the Government’s approach to wage demands and that this is a sort of non sequitur which is the weakness in the Government strategy.
Secondly, I would make this comment about tax indexation: It seems to us to have been in a sense a very strong ideological hang-up, leaving aside its merits or demerits in a practical sense as it affects people. I speak for myself when I say that I am concerned that the essential philosophy behind tax indexation is the belief which has been expressed by the Prime Minister, Mr Malcolm Fraser, on a number of occasions but perhaps most eloquently in the phrase which he used at the National Press Club luncheon last year when he said that the freedom to spend one ‘s own income is as important as the freedom of speech or the freedom of religion.
– Lord Beveridge said that it was the freedom people valued most.
-I am grateful to Senator Wright, the voice from the past, reminding me of the words of Lord Beveridge. I have a much greater respect for Lord Beveridge ‘s philosophy and work than I have for the philosophy of Mr Fraser, which is what I was dealing with when the honourable senator interjected. It seems to me that in the context of the Australian society in the 1970s and 1980s, the concepts with which Lord Beveridge was concerned in the 1950s perhaps are not entirely relevant to the sort of problems that we face in Australia. As I say, I am concerned with what I see as the sort of return to the tribal state in Australia in the 1 970s.
We will not be opposing tax indexation in the Senate when the legislation comes before us, first of all, because the Government has a clear mandate for introducing tax indexation. There is no doubt about that. It was made quite clear by the Fraser Government when it was in Opposition that it would introduce tax indexation if it were elected on 13 December last year. But we do raise doubts about the underlying philosophy that $5 in the pocket is more important than community services which a government can provide in the context of a modern democracy in the late 1970s. What it amounts to in overall political terms is a very direct attack on what Walter Lippman called the public philosophy. In a society like ours we must have a very strong concern, I believe, for the level of public services which are the concrete expression of what Lippman called that public philosophy.
The other ideological hangup, if I can use that expression again, to which I refer is the belief that in a sense you can opt out of government under the guise of what is now called new federalism. There is a lot of political cunning in the new federalism proposals, as they are called, but
I believe that they contain great dangers for a modern democratic society, just as the philosophical assumptions underlying tax indexation contain dangers of the same kind. The 2 dangers which are inherent in federalism as it is expounded by the Government are the possibility of the creation of a society in 10 years time in which there are different standards between the various States, because of the opting out by a national government of some of its obligations, and the loss of a sense of national purpose which only an Australian government can give and which State governments cannot give. It is these 2 criteria which seem to me to be most important in considering the proposals which are inherent in this whole economic package.
The main economic pronouncements were accompanied by some very important cuts in public expenditure. We as an Opposition have different priorities about many of the things which have been the subject of expenditure cuts. We have different priorities about education. In a sense we congratulate the Government on its very substantial commitment to education, although we would have preferred the commitment to have been better in certain areas, particularly the areas of technical schools. But overall we have different priorities from the sorts of priorities which the Government has adopted in its expenditure cuts.
I wish to refer to 2 specific areas of cuts which are of particular interest to me. The first one is the cuts which have been made in relation to the Australian Broadcasting Commission. In real terms the cuts are from about $132m to about $128m, or about $5m in real dollars in a year. Taking account of inflation, that represents a cut of about 1 7 per cent. It can be said that that is not a particularly enormous figure and that the Australian Broadcasting Commission or the people who listen to its programs should not be particularly upset about the order of those cuts. But the worst thing about these cuts in relation to the Australian Broadcasting Commission is that they are in an area in which a national service is provided for the whole community. That national service will have to be curtailed as a result of the cuts which have been made.
I refer to the national service available to the whole of the community because I want to distinguish it from a number of sizable items of expenditure on which the Government has embarked. I refer to the investment allowance, which goes to industry, and to the superphosphate bounty, which goes to rural industries. These are very big items of sectional expenditure from which the whole community will benefit indirectly, I suppose, if the plan works in the respective sections. But these sums of money are paid to specific interest groups in the community. As distinct from that the ABC, as I say, provides a service which is available to the whole of the community and the cost of that service is really pretty negligible.
There can always be subjective criticisms of a body such as the Australian Broadcasting Commission. Any body similar to that is likely to arouse quite a deal of criticism. But when one considers the real costs that are involved to the Australian community, it seems that these cuts in relation to the ABC are totally unjustified. The cost of the ABC to every Australian citizen is about 3c a day, or about $ 12 a year. That is not a very large sum for the diversity of service which is provided or for the work which is done by the ABC in areas such as ethnic radio, the provision of services to outback communities in Australia, the provision of Radio Australia and the provision of symphony orchestras in the 6 capital cities. These sorts of diverse services are provided to the Australian community at a cost of about 3c a day to each Australian citizen.
One must compare that cost with the cost of commercial radio and television which is inflicted on the Australian community in terms of the cost of products. The costs in commercial radio I think can fairly be estimated at about $300m a year. That money is spent on advertising to sustain commercial radio and television. But that sum of $300m a year is passedon to the Australian consumer in the added costs of products. That is each Australian citizen pays $27 a year for commercial radio and television. That compares with $12 a year which each Australian citizen pays for the Australian Broadcasting
Commission. Those are the sorts of cost items with which we are concerned, and it is in this context that a cut of $5m in real terms, or 17 per cent, is made in relation to the Australian Broadcasting Commission.
– Are you suggesting any public expenditure goes to commercial television?
– I am suggesting that public expenditure means expenditure by the public in the context in which I am using the expression.
I am saying that it costs the Australian people a lot more to support commercial radio and television than it costs them to support the Australian Broadcasting Commission. For this modest cost to which I have referred the ABC provides a service to the areas of the community about which I have talked. It is this sort of a service which will be pared back. There has been a lot of speculation in the newspapers about how that will be done. There has been speculation that programs like Late Line and other programs which have brought a diversity of interest to the Australian listening community and which have a very widespread audience will be cut back. But whatever the speculation about these matters is- and we can have our entertainment either by radio or by television or by Senator Wright, or in the bar or wherever we happen to be- the fact of the matter is that the level of community entertainment and education which is provided by the ABC is very widespread and important.
I do not believe that the Australian Broadcasting Commission itself is yet in a position to determine where cuts will have to be made. Certainly some cuts will take place. One of the most alarming features about the cuts to the ABC is simply the sorts of specifications which the Minister for Post and Telecommunications (Mr Eric Robinson) has put on the type of cuts which ought to be made. For example, in his statement announcing the cuts the Minister said:
The Government expects the Australian Broadcasting Commission to make a lot of the cuts in the administrative area.
The ABC is about the only public body which has been singled out to make cuts in a specific area, and that was in the administrative area. The Minister also referred to delays in the improvements which were to be made to Station 2 J J in Sydney and Station 3ZZ in Melbourne. All these improvements are to be deferred, in spite of the great success of those 2 stations in their respective areas. Nothing has been said about cuts to ethnic radio. Last night Senator Lajovic expressed a view about the importance of ethnic radio to migrant communities in Australia, and I do not think that anybody doubts that position.
But improvements of a similar kind, such as the extension of frequency modulation broadcasting to Perth and Brisbane, have been deferred. In all these matters there is a denial of a service to the listening public in Australia and to the community at large. What is rather frightening about the nature of the statement in relation to the ABC, which one suspects reflects ideology rather than economy, is that the Minister singled out the ABC and said that these cuts had to be made in particular areas. He specified the areas I have mentioned, all of which are appropriately a matter of proper examination by the inquiry into broadcasting and television which this Government has set up.
Every time since the beginning of this year when questions have been asked of the Government and the Minister about the future of FM radio in Perth and Brisbane, and about the future of 3ZZ and the relaying of station 2JJ to Melbourne and so on, the answer has been given that all of these matters will be dealt with by the inquiry into broadcasting and television. That has not happened at all. The fact is that there has been a great deal of undermining of public confidence in that inquiry which is to take place. The Government has aborted in a section the terms of reference of that inquiry by making these cuts in the budget of the ABC in the manner in which they have been made. Questions which have been on notice for a long time about these matters have not been answered by the Minister.
The only other area to which I wish to refer is that of Medibank. As I have said in this chamber before, when the Labor Government came to power in 1972, if it had a mandate to do anything about which the Australian people knew it had a mandate to introduce Medibank. Throughout all those years of Labor Government, the Opposition as it then was in this place consistently opposed Medibank. We were told that it did not matter that there were one million people in Australia who were not insured or covered by health insurance. We were told that there would be no freedom of choice under Medibank. We were told that Medibank would cost an enormous amount of money. We knew that; we did not need to be told. All of these things were said in Opposition over 3 years of Labor Government in oppostion to the introduction of Medibank. When in this Senate, facing up to the question of costs, the Government of the time introduced legislation to impose a 1.35 per cent levy on taxpayers incomes to help finance Medibank, senators then on the Opposition side opposed that levy and rejected that legislation.
Next week, those same senators will be coming here and voting in favour of a 2-5 per cent levy to help finance Medibank. The learned Clerk of this House has written a book in which he describes the functions of the Senate. He refers to them under the heading: Two Sieves are Better Than One. He said that about the Senate and the role of the Senate as a House of Review. Am I not now entitled to ask the question whether perhaps 3 sieves would not be better than two or whether there should not be a further House imposed as a House of Review on top of the Senate, because only last year that 1.35 per cent levy was rejected by people like Senator Chaney, who is seeking to interject, who will come in here next week and vote for a 2.5 per cent levy. That is an interesting example of the role of the Senate as a sieve, as a House of Review. It sieves Labor legislation, but it lets through much bigger levies when a Liberal government is in power.
The fact is that this Medibank levy is just a trade-off for tax indexation. The result of it for the Australian people will be confusion, a 2- tiered health system and the cost of implementation of the levy will be very considerable and confusing indeed. One of the excuses is that people should have freedom of choice, for goodness sake, between 2 health insurance funds, that is, freedom of choice as to who is going to pay your medical bills. Does anybody seriously give a damn about that sort of freedom of choice, about who is going to pay your medical bills? Is that an important freedom of choice in our society? But that is one of the ideological excuses given for the introduction of these new proposals relating to Medibank.
– One might pay better than another.
-Perhaps we should look more closely at the choice, as I am provoked by Senator Sheil to do, and specifically at the sort of choice which is being offered between the 2 systems. If you do not want to pay the levy, you can opt out of Medibank by the payment of a $300 ceiling. If you get out of Medibank for that and you want private health insurance as well to cover intermediate wards and so on in hospitals, you can pay $435 a year for the privilege of having those 2 systems of medical coverage made available to you.
– The honourable senator who interjects will no doubt tell us all about this when she makes her speech on the subject. But the difference between the estimated cost of belonging to a private fund for full health cover of $350, and the cover provided by Medibank plus extra cover for intermediate ward and so on, is some $85. That is the sort of freedom of choice which people are being offered, even if freedom of choice in relation to the payment of medical bills was a relevant factor in a contemporary society.
So, what is being offered is Buckley’s choice. Mr Fraser is going back on the obligation which he undertook to the Australian people in December last year that he would not interfere with Medibank. Any senator on the Government side who doubts that statement can read any one of Mr Fraser’s speeches made in the course of that election campaign. What is happening is that Medibank is not to be killed off with one blow; it is to suffer a slow death as many of the patients under Medibank, and private health insurance for that matter, have suffered over many years. That is another important example of the sort of humbug which is inherent in some of the details of this economic statement, where ideological factors which have possessed senators on the other side of the Senate in relation to Medibank, have possessed people like Mr Fraser in relation to not only health insurance but also various other areas and have possessed people like Senator Withers in relation to the Australian Broadcasting Commission really come to the fore.
– What are you going to do with respect to that legislation?
– We wish the statement every success, Senator Young. We hope that it succeeds in curing inflation. But we say that we have an obligation to the Australian people to point out some of the thoughtless considerations in our view, some of the naive considerations and some of the purely rather bitchy ideological hangups which have motivated the Government in certain areas of the expenditure cuts which have been imposed upon the Australian people.
– I can assure you, Mr President, that it is not by choice that for the third time I follow Senator Button in debates in this Senate. Senator Button’s speech typifies the desperation of the Opposition and the guilt of the former Government. He has attempted to draw red herrings across the trail on the Medibank issue to confuse the electorate because he realises that the former Australian Labor Party Government released an economic monster on the Australian community when it propounded the Medibank scheme.
I believe that what the Government has done and contemplates doing will preserve the freedom of choice which, in our ideological view, is the right of every Australian taxpayer. The health of our community is one of the most important issues that confronts this nation. Senator Button echoes the guilt complex of the Labor Party when he chooses to demonstrate the points of view that he expressed earlier. We on this side of the Senate believe that Medibank, having been introduced, must remain. I believe that there are some aspects of Medibank that are good. I believe further in the course of action taken by the Government in seeking to provide freedom of choice for the Australian people between the private health institutions or Medibank, or some sort of balance between the two. So, I am not convinced by what Senator Button has had to say. I am quite certain that the community at large is not deluded in any respect whatsoever.
I wish to devote the few moments at my disposal to saying something about the wine industry in Australia. In doing so I recognise that this industry is most significant to Australia and very important to South Australia in particular. Above everybody else in this Senate I believe that you, Mr President, recognise this because of the efforts you have made in this area since your election to the Senate.
– He is an outstanding wine producer in his own right, too.
-That is right. The President has lived all his life in the area that produces a large quantity of wine in South Australia. There is little if any disagreement among wine experts today that Australia produces a range of wines comparable with those produced by the world’s leading producers. Australia has a distinct advantage over most producing countries in that it is possible to find the climate as well as the soil type to produce almost any special characteristic required by the wine maker. Since the inception of commercial wine making in Australia, governments have indicated a more than passing interest in its progress. This attitude is as apparent today as it has been over the century or so that the industry has been a taxing proposition.
If one takes the trouble to look at the history of the industry of Australia one thing stands out above all else and that is that government intervention tends to inhibit the ability of the industry in every respect. In fact, the ability of the industry to withstand the onslaughts of government intervention over the years speaks volumes for the pioneering spirit of the founders of the industry and the generations that have followed in it. The wine and brandy industry has been successful in coming to terms with nature- and this is evident to a large degree- through improved technology, practical experience and an inborn, long-suffering quality devised by evolution. The reference to government interference that I have made stems from the level of federal and State taxes levied on sections of the industry in the form of excise duties, licensing fees, and special industry levies as well as taxation measures appropriate to other forms of industry. If we consider the wine industry graphically- and I am sure that you, Mr President, have done this over the years of your experience with the industry- it is clear that the peaks and troughs of prosperity have occurred in direct relation to some major government interference in the affairs of the industry. For example, increased production has resulted from government-sponsored land settlement while at the same time there has been monetary revaluation, increased excise, new wine taxes and the restructuring of the income tax requirements such as through the repeal of section 3lA of the Income Tax Act. The abysmal ignorance of the effect that a major change of government policy has on a highly sensitive and labour intensive rural oriented industry is unforgivable.
– This is where you get into trouble though. It is a classic phrase. You socialise your losses and maximise your profits.
-I am glad that Senator Georges has interfered in this debate because the Labor Government was demonstrably weak and incompetent in the management of the wine industry and I will go on and mention a little more about that.
– Broken promises.
-That is right. I believe that the previous Government should have revised its attitude to this industry. Senator Georges knows very well that his government let this industry down. In this inanimate, computerised age in which we live there is a greater than ever responsibility on Parliament to act as custodian of the rights of the people so that we can ensure that taxes fall equitably on all sections of the community. The wine industry like many others in our community realises that it must have finance to enable it to function properly, but it cannot accept the situation which has brought an extremely viable industry almost to its knees through government action, particularly over the last two or three years.
– No; you put on the 50c excise and we took it off. That is when it started to compound.
-We will come to that. Senator McLaren is perfectly right and I am glad that the honourable senator from South Australia, who with his Government imposed even greater problems on the wine industry than were ever anticipated, has interjected. The industry accepts its responsibility to help through taxation to finance this country but I believe as a result of constant contact with the industry, particularly in recent times, that all it asks is to be able to discuss with an open-minded government the means by which the least disruption will be caused to those who are engaged in the many complex functions of its operation. This general view is evident in the industry although there are many sectors of the industry which vary in their attitudes.
The Government that Senator McLaren supports, the Whitlam Government, promised that if elected to power in 1 972 it would remove the tax on table wines which was imposed admittedly in 1970-71. I can recall at that time that there was a lot of opposition to this proposition from this side of the House in particular. You, Mr President, at that time were most active on the imposition of the 50c excise on wine. It was as the result of your advocacy and the support you received from people in South Australia and other wine growing areas in Australia that the Government recognised the need to reduce this excise to 25c. However, the Labor Government -
– Which Government?
– The Labor Government said it would remove it.
– And we did.
– Yes, you did. I will come to that in a moment. However, you went a little further than that. I recall that Mr Dunstan, the Premier of South Australia, was going to the wine industry and saying: ‘Give us funds for our campaign because we will remove the excise ‘.
– He must have been home in South Australia then.
-Quite right. I am glad that Senator Hall interjected. I understand that the Premier of South Australia is coming home at last next weekend after an absence of several weeks jaunting overseas.
– I am corrected. He has had several months of holidaying overseas at the expense of the South Australian taxpayer.
– What about Mr Fraser; he is going too.
-Do not talk to me about Mr Fraser ‘s activities because when I was in England last year -
– Then you were away too.
– I paid my own way, I might say.
– According to the record you did not.
– It is interesting that this comment should have been made in this debate because I discovered when I was in England that the former Prime Minister occupied a floor of a very expensive hotel in London with no fewer than SO people in his entourage. His room cost the Australian taxpayer £150 sterling a day. So honourable senators should please not interject in that way because it reacts badly against them. Senator Hall was perfectly correct in drawing my attention to the absence from South Australia of its Premier for several months. The Whitlam Government did remove the tax, as Senator McLaren has said, but straight away what happened? The Whitlam Government increased the excise on brandy, an action which has had most deleterious effect on sales and has encouraged the importation of dubious quality foreign brandy.
– No, we have not. Have a look at the General Agreement on Tariffs and Trade. You have not done anything about it, because you cannot.
-Mr President, I may be forced to ask for an extension of time if this type of interjection continues. I recall asking the Minister in charge of excise at the time, Senator Murphy, now the honourable Justice Murphy, what precautions were taken by the then Government to ensure that brandy from overseas was essentially of the grape and in fact had been in the wood for 2 years. Although he expressed great interest in this question and had obvious guilt in the matter, he could not assure me that the brandy that was coming into Australia was of high quality. I believe that most of the brandy that comes into this country could be of non-grape origin, and I suggest to the present Government that we ought to be looking very carefully at this in order to correct the mistakes that were made by the previous Government.
In 1973 the Labor Whitlam Government abolished section 3 1a of the Income Tax Assessment Act on the recommendation of the Coombs task force. I recall that at that particular time I described the Coombs task force as a disaster area. I do not know whether Senator McLaren knows about this, because he probably was not in South Australia at the time, but section 3 1 a of the Income Tax Assessment Act was introduced in 1953, acknowledging that the vintners turned over their stock on an average of every 3 years and legalising a 30-year-old practice in the wine industry of placing nominal values for tax purposes on the end of the year stocks of maturing wine and brandy. This practice did not remit taxes; it merely deferred them. It enabled winemakers to mature their wines and to concentrate on the quality of the product as well as finance a healthy growth rate. The Coombs task force presented a report within less than 2 months of very cursory research of the matter, which covered 141 areas of policies and projects of the previous Government. Actually it is quite amusing and almost laughable that section 31a as it applied to the wine industry was listed for consideration as item 1 13. The report stated that the Government could realise an additional $ 15m in revenue if the interest-free loans implied in the practice of nominal valuation of wine and brandy stock were discontinued.
– How about that.
-I thought that was quite irresponsible. This particular matter, which is of grave significance to South Australia, was decided as item 113 in a list of 141 items which were evaluated in 2 months. In my opinion, through a lack of appreciation and research the task force wrongly assumed that multinationals held a very high proportion of the industry’s stocks. Of course this was sponsored by the paranoia of the Labor Party at that time. The task force assumed that the multinationals held a very high proportion of the industry’s stocks and that improved technology had reduced the maturation period required out of all proportion to the actual position. This is precisely the basis on which the task force made its evaluation. But the fact is that winemakers controlled by overseas companies were responsible for less than 20 per cent of the grape crush at that particular time and since then the percentage has decreased considerably. I cite a recent example of where Thomas Hardy and Sons Pty Ltd in South Australia took over the Emu Wine Company Pty Ltd, which was essentially a multinational corporation.
On the second point, good wines still require a full maturation period. The effect of the removal of section 3 1 A can be summed up briefly as follows: The tax concession given by section 3 1 A of the Act enabled winemakers to place nominal values at the end of the year on stocks of maturing wine and brandy. I repeat, this practice did not in effect remit any taxes but merely deferred the payment of taxes on these stocks until the stocks were actually sold. This enabled winemakers to mature their wines and concentrate on the quality of their product. But the Whitlam Government- the Government supported by Senator McLaren- at the time of the South Australian election in July 1975 promised to extend the original period of 5 years to a period of 7 years to enable the industry to pay these taxes. This promise was broken. No extension was ever given.
– You would not let us.
– As far as this present Government is concerned, the industry was assured during the general election campaign last year that the new basis of stock valuation for winemakers, combined with industry company tax rates, was threatening to bankrupt many important Australian wine producing companies. The present Treasurer, Mr Lynch, did undertake to have a very careful look at the tax structure of the industry. In fact, he has fulfilled a promise that was made by the Whitlam Government and has given an extension of time to 8 years -
– By 12 months, that is all, and that is what we promised to do.
– OK, but anyway we have recognised and fulfilled a promise that was broken by the former Government.
– You would not let us move in the Senate.
– Look, we took over the economy of this nation when it was at disaster level. We inherited a business which was in deficit to an extent of something like $5,000m. No businessman taking over from people who were not competent to manage a business is able to reverse the situation in a matter of a few weeks or months, but I believe that in 6 months we have made very significant progress in this direction.
– You have to prove it yet.
– It has already been proven by the confidence which has been injected into the community.
– There was not too much confidence in New South Wales a few weeks ago.
– I am going to ask for an extension of time because, after all, I expect the Deputy President to give me an uninterrupted time considering the limitations which have been imposed. I suggest that the industry gained under section 3 lA of the Income Tax Assessment Act. It benefited in many ways. There were higher prices to grape growers, surplus grapes were absorbed in big vintage years, increased wine and brandy stocks were available to meet the demand, longer maturation time was provided for better results, research and development was provided in grape growing, and improved techniques in making and bottling the wine resulted. The improving of the image of Australian wine was one of the results of this section of the Act. Also, we were able to promote and distribute research facilities throughout the industry.
What happens without these benefits? Wine makers will resist any increase in grape prices. Grape growers will ask the Government for help to dispose of surplus grapes. Builders, equipment suppliers and the like will suffer from cutbacks. Coopers, bottlemakers and other suppliers will curtail sales. Budgets for advertising, promotion and research will be cut back. Merchants, retailers and consumers will be adversely affected. Federal and State government tax payments will be substantially reduced. The deferred tax can be financed only by a reduction of stocks or the calling on future profits. Obviously the consumer is the person who will have to pay in the long run. The co-operative section of the industry has no problem in this direction as it does not pay taxation in the same form as do private proprietary and public companies. They distribute their profits prior to submitting a tax statement. The tax is actually paid by individual shareholders.
It is wrong for anybody in the industry to say that co-operatives pay no tax for the reasons which I have just advanced. Section 3lA was enacted in 1953 because it was essential to the survival of the grape grower and the industry. In my view, the same conditions apply today. For these reasons it is my belief that the Government has to hold a further intensive inquiry into this important industry to discover whether there is an alternative way to obtain revenue with the least disruption to all sections of the industry. As far as I am concerned it is encumbent on the present Government to have another look at this part of an Australian industry which, over the years, has proved to be viable and able to produce something for the economy. It behoves the Government to have a very careful look at the effects on this industry of restructuring the taxation system.
- Senator Jessop has introduced a touch of whimsy into what is otherwise a rather dry subject with his discussion of table wines and London hotel bedrooms. I do not wish to debate these matters with him as I bow to his superior knowledge of both subjects. Not only was the atmosphere of the bon vivant introduced into our debate but also a rather delicate touch of nostalgia when the honourable senator referred to the present Government’s usurpation of power in the terms which he used when he said: ‘We took over a business’. What I rather liked about that expression ‘We took over a business’ was the delightful nostalgia of it all. It carries one back to 1926 when Calvin Coolidge was the President of the United States of America. Senator Jessop who, no doubt, has just recently caught up with Calvin Coolidge ‘s thinking will remember that the late President said on that occasion in the era of the pre-depression boom of the 1920s that America’s business is business’, that the role of the United States Government was to do nothing which interfered with business and to do everything which would benefit business.
– A good point.
-Senator Sheil who also subscribes to the Calvin Coolidge doctrine agrees with that. No doubt he would endorse what Presidents Harding, Coolidge and Hoover did during the period from 1921 to 1933 after which the Republicans were replaced in the administration by President Roosevelt.
– My word!
-‘ My word’, says Senator Sheil. I do not want to become involved in a side debate with the honourable senator. I think he ought to remember what happened at the end of that period of ‘America’s business is business’ with Harding, Coolidge and Hoover. What happened was the greatest depression which the capitalist world has ever seen. There was the greatest erosion that the world has ever seen in the confidence in a system which Senator Jessop and Senator Sheil uphold. A great transformation to the economies of Western countries took place as a result of the pursuit of those policies 50 years ago, policies which are pursued today by this Government in Australia. The result of the election of this Government is that we now find that people actually are doing what in the past they were only saying they would like to do. Once, there was only a handful of rather strange people on the fringe of the extreme right who read the novels of Ayn Rand and who thought that there was something in the doctrines which she was espousing. Now we actually find a Prime Minister (Mr Malcolm Fraser) and a government which not only reads this nonsense, not only believes this nonsense but also actually runs a government on these principles. It is a most remarkable development. I think that Australia along with Chile could well become- I am not talking about military coups or torture or anything like that -
– Do you not believe in business management?
-No, I do not believe in the doctrines of Ayn Rand. I must say that Senator Jessop, for someone who was so upset at interjections while he was speaking, does not extend the courtesy to me which I was so gracious to extend to him even though I was subject to the greatest provocation while he discussed French brandy with us for an hour and a half. I was about to say, when Senator Jessop returned to the previous subject of the symposium to which he had been addressing himself earlier -
– At least I had a symposium. You have nothing to say except that you believe in bad management of the economy.
– I must confess that with witty retorts like that from Senator Jessop one is at a loss to know how to reply. He has me; I am nonplussed. Senator Jessop who strenuously objected a few moments ago to interjections I think should be reminded of the situation. We now have a Government which, along with the Government of Chile, will serve as a sort of test tube experiment for the rest of the world as to how a relatively advanced capitalist country will get on when it starts to apply the doctrines of Ayn Rand and Milton Friedman. That is what we now see being done in this country. For years people came here and talked during the adjournment debate and at question time about the communist dominated Australian Broadcasting Commission, how Blue Hills was driving people into the arms of Mao Tse-tung, how people going to Medibank were loafing on it, how people who got funeral benefits were death bludgers and matters of this kind. Now we actually see a government which believes that and is carrying out those policies. What we have seen the Government do during the time it has been in office, despite the undertakings it gave in December of last year, prior to that election which should never have taken place, is to reverse those principles completely.
Senator Jessop continues to interject. I can talk much louder than he can. Not only am I wittier, I am much noisier. I would say to Senator Jessop that not only is this Government of which Senator Jessop is one of the junior supporters reversing completely what it undertook to do but at the same time it is completing reversing what has been the consensus of every advanced Western capitalist country since Roosevelt was elected to the presidency of the United States in 1932- that is, a modern country cannot be conducted on the basis that the business of the country is solely private business. There is a substantial role for the public sector. Not only has it to see that the poor and underprivileged are protected and benefited by the State, but there are many things which can be provided only by the State and which cannot be provided by private enterprise. That is what the Labor Government did and that is what, although somewhat less enthusiastically, previous Liberal governments did in this country. It is only in recent years, when people like Reagan have achieved some prominence in the United States as political figures, that there has been any tendency in the heartland of capitalism to reverse those processes. We find that it is happening now.
In this statement which has been delivered by the Treasurer (Mr Lynch) we find that there is going to be what he euphemistically describes as a reining in of Government spending. On what are the attacks to be made? Where is the expenditure to be, as the Treasurer puts it, reined in? It is to be reined in on the environment and on regional development, on those things which the Labor Government tried to do to ensure that no longer would there be vast agglomerations of people in this huge continent living in a few square miles, with all of the problems that come from a large urban area. It is to be reined in on the efforts made to ensure that there was some decentralisation, which members of the National Party or the Country Party or whatever its name is at the moment talk about so enthusiastically but do so little about. It is to be reined in on health and on welfare. Despite the undertakings given that there would be no tampering with Medibank, we now see Medibank being demolished.
– No, Senator, that is not so.
-We now see Medibank being reduced to a shadow of what it was formerly. It is to become a complex system which I doubt very greatly Senator Walters could explain to us, and so far the Minister for Health (Mr Hunt) has been unable to explain to anybody’s satisfaction. It is a system which will breed confusion and fear in the minds of all Australian people, and it will replace a system which the members of the Parties that constitute the present Government undertook during the election campaign in December of last year they would not interfere with. Expenditure is to be reined in in the arts, and nothing has shown more the Philistinism and backwardness of our opponents than their whole approach to the arts.
– And to the ABC.
– I am including the Australian Broadcasting Commission in that. Not only have these unfortunate people sitting opposite attacked the alleged political partisanship of the ABC but, not satisfied with having the entire privately owned media in this country on their side, they objected strenuously when it looked as though Labor would get 50 per cent of the time on the publicly owned media. That was too much for them to take. It was too much for them that there should be one organ of opinion on which Labor got half the time. It was much too much for the members of the Liberal and National Country Parties. Beyond what may be done in the field of news and public affairs, there is also their assault on the arts and on the efforts of the Labor Government to see that all of the people of Australia were able to share in the cultural riches of modern civilisation, however rich or poor those people might be. The Labor Government tried to ensure that it was not just those people who could afford the fare to Europe or New York and so visit the Museum of Modern Art who could see great paintings or could hear opera or good music. Those were the things we tried to bring to the Australian people.
If one thing reflected more than anything else the attitudes and at the same time the ignorance of the people who today sit in Government, it was the constant talking that we used to hear all the time about Blue Poles. All we could hear from them was ‘Blue Poles, Blue Poles’, like the mooing of a cow at a Country Party meeting in Gippsland. I should like to refer to Blue Poles, because it is the sort of thing on which the present Government is not going to spend money. The Labor Government bought a painting by one of the leading painters of modern times. Many people like him; many more probably do not. But I do not think there is any significant art critic anywhere in the world who would not acknowledge that Jackson Pollock was one of the most significant and important painters in the history of painting, a man who had a tremendous impact on the whole development of art. Whether he is good or whether he is bad, his paintings are paintings that can be seen by ordinary working people in New York, in London, in Paris, in Amsterdam, in Bonn, in Vienna, in Rome, in any of the capital cities of countries with economies similar to that of Australia. We tried to ensure that such people were able to see these things in Australia.
I notice that Senator Townley is giving us the benefit of his expertise in aesthetic theories. The Liberal and National Country Parties talked about the waste of money on these purchases. Of course, the money that was spent on Pollock’s painting Blue Poles was a substantial sum of money, but I do not think there is any expert in the field of buying and selling paintings who would not say that if the Government wished to sell Blue Poles, as no doubt this Government will, it would be able to sell it for a considerably higher price than was paid for it. From the point of view of ordinary commercial undertaking, it was a very good buy, worth much more in dollars than was actually spent on it.
Not only has this Government attacked matters such as that, but we see an onslaughtdespite undertakings that were given by various shadow Ministers, some of whom became caretaker Ministers, some of whom, but not all, then became real Ministers- on the moneys available for the welfare of the Aboriginal people of Australia and for legal aid. Probably next in importance to, and sometimes I think equal to, the provision of hospital and medical care for the Australian people is legal aid. It should be given the highest priority so that all people will receive the best representation in the courts of the country and obtain the best legal advice. It is no use having as a doctrine that ignorance of the law is no excuse if great masses of the people of any country are precluded from obtaining proper legal advice, and only those people who can afford it can get legal advice and those who cannot afford it cannot get legal advice. It is no use having legal rights if you do not know what those rights are, particularly if you are dealing with people who do know what their rights are. For that reason the Labor Government introduced a system of subsidised and free legal aid throughout Australia. Naturally, one would expect of Parties acting out of loyalty to their own class position- these Parties who say that there are no classes- that one of the first targets of their attack would be the Australian Legal Aid Service, which was established by a very great AttorneyGeneral in a Labor Government, Mr Justice Murphy. What else have these Parties attacked?
– Do not make it too much of a joke
-Senator Webster says: ‘Do not make it too much of a joke ‘.
– The president of the flat earth society.
-Senator Webster, as I have been reminded, is the only Minister for Science in the world who is also the president of a flat earth society. Senator Webster would be one of the first, of course, if Sir Garfield Barwick were to be reflected on, to say: ‘What a shocking thing it is to reflect on a member of the j judiciary ‘. But he, as the Minister supposed to be upholding the Constitution through the Executive, is only too happy to reflect on a member of the Bench of the High Court if that member of the High Court Bench was once a member of the Australian Labor Party.
– Two of them are former members of the Parliament, one Liberal and one Labor.
-That is right. As Senator Douglas McClelland said, Sir Garfield Barwick is not the only member of the High Court who has been a member of a political party. In fact there are others there. There is one other, the Chief Justice, who was a member of the Liberal Party, and we have heard no aspersions cast on him by anybody including members of the Labor Party. We have not done that. The other assault which has been made by this Government is on child care, something which goes to the very heart of our society. Something of the greatest importance to developing a proper Australia is provision for the care of the children of this country. As one would expect, again this has been subject to the hatchet in this mini Budget or whatever it is being called. It has been done in order to reduce Government spending.
I was one of the Ministers in the last Government who were in favour of a reduction in public spending. I believed that the level of nonprofitable public spending, that is to say public spending on such things as welfare which do not produce a return, had reached too high a percentage of the gross national product of Australia. I do not dispute that, but it was not because of some principle that there should not be public spending that I or the other members of the Labor Government were agreeable to cuts being made in public spending. It was a temporary expedient. It was not an article of faith as it is with the present Government. Members of the present Government tell us that they are doing it because it is a means of fighting inflation. No doubt in the short term it is a means of fighting inflation, but at the same time one can only be bewildered as to how. I am waiting for someone to explain to me how it is, if we are fighting inflation, the Prime Minister tells us to go out and spend. I know that the Prime Minister is greatly impressed by the synopses of Milton Friedman’s economics which he has read in the Reader’s Digest. I know the synopses can be very persuasive, but at the same time I believe that there are certain fallacies, with the greatest of respect to the Head of the Department of Economics at the University of Chicago, in what he said. He has used the wonderful example of how, when the Confederate printing works that printed the currency was captured during the American Civil War, there was a shortage of money and therefore inflation stopped in the Confederate states, proving that the amount of money that is being printed is directly related to the level of inflation. Of course one does not need to be Joan Robertson to be able to point out that it is not only the volume of money that is being printed; it is also the velocity of movement of that money.
President Ford was saying if I remember correctly I think his advisers, on the whole, would be a little more sophisticated than those of Mr Fraser- only a short while ago in the United States of America when he was running his rather ill-fated WIN campaign- the Whip Inflation Now campaign- that people should not go out and spend because to do so would increase the rate of turnover of money and that in itself increased inflation. If inflation is the primary evil and everything else- childcare, legal aid, health, Aborigines, unemployment- must all be sacrificed to this great goal of destroying inflation, how does one explain the proposition that we should all go out and spend? It has not been explained to me yet and I am waiting to hear somebody explain it to us later.
What the Government has done with this Budget is to bring into force its own prejudices and its own basic fears of that strange world that it finds impossible to accept, that world which Franklin Roosevelt accepted right back in 1932 and which the American people on the whole have accepted ever since. Last night Senator Lajovic, whom I notice has now joined us, produced a whole array of demons who were waiting to destroy us. He included both Sweden and Yugoslavia amongst them. I am not constrained to say anything for or against Yugoslavia. Its government does not have any relationship with the Australian Labor Party, but he did make a passing reference to Sweden and trotted out one of these hoary old canards, saying: ‘Has any honourable senator ever been to
Sweden and seen the quality of life there? Sweden has one of the highest suicide rates in the world’. I notice that this nonsense about the high suicide rate in Sweden was repeated by some reporter in the Australian this morning.
I am reminded of a pamphlet I read not so long ago, produced not by the Swedish Labour Party but by the Swedish Employers Federation, which discussed this matter. They said they were a little puzzled as to how it could be established that welfare in Sweden had produced a high rate of inflation. Were those who made this claim suggesting that a 73-year-old person who was not receiving an old age pension would be less likely to commit suicide than a 73-year old person who was receiving an old age pension? Were they suggesting that somebody who had a house with heating and was going to get unemployment benefit if he was out of work, was more likely to commit suicide than someone who did not have a house, did not have any heating and did not receive unemployment benefit? In fact as they showed quite clearly, the suicide rate in Sweden has remained static since about 1890 when there was in office there a very conservative government which would have been to Senator Lajovic ‘s liking. The suicide rate has not changed in any way by the election to office nearly 50 years ago of the Swedish Social Democratic Labour Party which has remained in office ever since. Despite these stories about suicide, Sweden has the highest per capita gross national product of any country in the world, excluding a few Arab emirates where it is impossible to make any relevant assessment. It is higher than that of the United States. Nearly 50 years of Labour government in Sweden have given Sweden the highest standard of living in the world.
I would like to say something about this nonsense of the suicide rate that we keep hearing all the time. I checked the figures today just to refresh my memory. The Swedish suicide rate figures, on a comparison with comparable European countries, fall below those of Hungary, Finland, Austria, Czechoslovakia, Denmark, West Germany and Switzerland and the rate of 21.7 is barely higher than that of Australia with a rate of 19.6. If the same statistical methods that are used in Sweden whereby all fatal car accidents in which only one driver is involved are automatically included as suicides, as are other occurrences of that kind, were to be used in other countries, one would find that there is a much higher suicide rate under a Liberal Government in Australia than there is under a Labour government in Sweden. In fact even without making that statistical adjustment, the suicide rate in Sydney is considerably higher than the suicide rate in Stockholm. I mention that only in passing because this is pan of the general plethora of nonsense that we have to listen to whenever there is a debate of this kind about the evils of socialism.
We have seen develop in most western capitalist countries over the past 30 years or 40 years a consensus whether or not one supports an extension of public enterprise and ownership. In Sweden 90 per cent of the economy is in private ownership. There was very little change in this regard going to be made within Australia under the Labor Government, however desirable many of us may think that should be. There has been a consensus that one of the most essential roles of the state is to see that the poor, the sick and in fact all citizens are protected in their basic needs and that the state plays a role to see that everybody is entitled to the fruits of education and to the fruits of the culture of the civilisation within which they live. This Government has set out to destroy those objectives and to destroy those achievements. It has used arguments to justify this destruction which themselves are internally inconsistent and which they have not been able to explain either to the satisfaction of this Parliament or to the satisfaction of the Australian people.
– Members of the Labor Party contend that Senator Button is a hard act to follow. I assure them that Senator Wheeldon is an even harder act to follow. I might just mention a few of the points that he made in his speech. The first one was that he and his Party think that the philosophy that good government is good business has gone out. I cannot agree with him at all. He says that he does not believe in the philosophy of Ayn Rand. He is perfectly entitled to his own belief. I just think more is the pity. Senator Wheeldon says that the public sector is the only sector that can do certain things for our society. He seems to think that the Labor Party has a monopoly on charity and doing good works for the halt, the lame, the sick, the blind and the poor. I can assure him that is not so because the only way to be able to afford charity is to be able to afford it.
The public sector has no money of its own; only money that it gets from taxpayers. The charity that the public sector hands out is something of a permanent nature and makes people more dependent on government, whereas charity that is handed out by the private sector is more temporary and more dignified than any government charity. Senator Wheeldon made the point that various governments around the world were given differing advice from differing economic advisers on whether they should spend their way out of trouble or stop spending. I think that is indicative that no government knows how to handle the economy, and the sooner governments remove themselves from the economy the happier people will be.
At the moment we are debating approximately a dozen Bills which are part of the economic package put forward last week by the Treasurer (Mr Lynch) on behalf of the Government. Honourable senators are discussing sections of the package in which they have a particular interest. The section in which I have a particular interest is the Medibank section which consists of 3 Bills and allied taxation Bills which allow the implementation of the 3 main Bills. The new systems is due to come into operation on 1 October. I express my thanks and compliments to the people who worked on the committees that examined the Medibank legislation. The task was not easy. The work took many months. At times it seemed that we were wrestling with a boa constrictor. Although we had it by the throat, every time we took a coil off one limb we found another coil around another limb. It was a difficult job. Eventually we got it laid out. I think that the solution that the Government parties have come up with is probably the best that they could arrive at, considering the problem that Medibank presented. It is like one of those political things; if you cannot dissolve it you dilute it. That is what we have done to the Medibank program.
I had an opportunity to visit the Medibank centre at Phillip, a suburb of Canberra, about a month ago. It was the first time I saw the enemy face to face. It is a gargantuan monster. It is really a bureaucratic Valhalla and a gigantic instrument of control not only of patients, hospitals and nursing homes but also of doctors and anyone concerned with it. It is an instrument of control. There are 2 huge Honeywell computers humming away there, digesting forests of paper. There are computer pages marching in and out of these machines. They seemed to me to be consuming enough trees to disturb even the most conservative conservationist. An even bigger computer is being installed now. I understand that the 2 Honeywells will be transferred to Perth to do some other job. The computers that Medibank has now were given to it by the Department of Social Security. The cost of those computers, tens of millions, I understand, has not been included in the first year’s estimates of the cost of running Medibank. Payout cheques are marshalled like storm-troopers. They march out in serried ranks, shoulder to shoulder. To see that number of cheques going out of any institution I find most disturbing.
There are memory banks stretching off into the distance. They are capable of instant retrieval of all information, even the most trivial information. It is all information that could be used to irritate each one of us. It is information that cannot be kept confidential, no matter how much legislation is passed through these Houses of Parliament. With the implementation of these Bills there will be leakage of information between Medibank, the medical funds and the Australian Taxation Office- the 3 components, the medical funds, Medibank and the Taxation Office. The Chinese have a proverb that a secret is no longer a secret when more than 2 people know. Even the most paltry documents are photographed and stored. I believe there are 400 microfyche viewers on which to see these documents. All documents are photographed. Even paltry ones are photographed and stored on microfiche. It is not really microfiche, it is more like Jaws.
By some stupendous mental gymnastics the bureaucrats have identified the need for 246 different forms. I cannot imagine 246 different forms ever being required by a medical insurance company. I know that bureaucrats cannot operate unless they have a lot of paper to shuffle around, but they have identified the need for 246 different forms. An initial run-out of 90 million was printed. I do not know how many have been printed since the first report on Medibank was published, but it would be considerably more than that. The bureaucrats took some pride in saying that they had met design deadlines, approval deadlines and production deadlines in getting out these forms. Everybody filling in forms and sending them back, where they are shuffled around, means considerable work. At the time the report was put out these forms were arriving back at Medibank at the rate of half a million a day. I can imagine it is considerably more than that now.
With the introduction of the Bills we have created some paths by which people can get around the Medibank monster in the hope of preserving some of their personal business as private. We must never forget that the monster is still there. He will be smarting a little because he has been deprived of half his food. It is estimated that half the people in Australia will vote with their feet and opt out of Medibank. I think that is shown by the fact that even in the heyday of Medibank during the term of the Labor Party Government so few people actually left the private health insurance funds. I think that indicates that more than half the people in Australia wish to retain private medical insurance. The fact that Medibank was introduced in this way will not create a 2-tier system of health care in Australia, as was claimed in another place yesterday. The new system will give people a wider choice of the type of health insurance that they can obtain. We have created a choice of 4 medical insurance covers. Most of the government subsidy will go to the disadvantaged groups. As one goes up the income scale, the subsidy reduces.
We await with interest now the reaction of the medical insurance companies. By ‘reaction’ I mean the package that they will come out with to present to the people so that the people get an honest choice. Under the National Health Amendment Bill, the medical insurance companies will have certain conditions imposed upon them. For example, they must show that they are capable of providing the minimal cover that is expected from Medibank. Also included is a requirement to reinvest money in a fund to be created. It will be a most important fund. Medibank will contribute $50m to it, and the funds will contribute too. That is to cover hospital patients who are chronically ill. This was a weak area in the past. Chronically ill patients are described as those who have been sick in hospital for 60 days or more. This reinvestment fund will be administered by the medical benefits funds as trustees, not by Medibank. The provisions in these clauses of the Bill will ensure that funds do not discriminate against contributors who have pre-existing illness or chronic illness. There is still a 2-month qualifying period for entry into the private health funds, but during this time patients will be covered by Medibank.
Similarly, at the other end of the scale, if people opt to get out of the private health insurance funds, the private funds will cover them for 2 months and that will be followed up by cover from Medibank. The Bill strengthens supervision of the medical funds. The Government has felt an obligation to do this because it is forcing people either to pay a levy to go into Medibank or pay a premium to enter a private fund. The Government feels it should supervise those funds to see that they are reputable and competent. This sounds queer logic to me when we look at the record of government in this country recently. The Bill also extends benefits to all nursing home patients. This is another important provision because previously pensioners were well cared for but people in private health insurance schemes were disadvantaged. The Bill will remove that disadvantage.
One amendment to the existing legislation is designed to avoid forcing doctors to bulk bill which, as honourable senators will remember, was one of the most vicious bones of contention with the introduction of Medibank. Another provision is designed to protect the arbitrary right of entry of inspecting officers to examine the books of medical insurance funds and nursing homes. The legislation provides that proper procedures be employed in order to gain a right of entry. On top of all this, one of the Bills provides that people who are privately insured are not entitled to Medibank rebates. A person could not receive benefits from both sides of the fence. The legislation also excludes people who are travelling to Australia- for example, tourists- from receiving benefits. However, the Minister is given a discretion so that even tourists can qualify for benefits in necessitous circumstances.
In addition, the Bill restricts the circumstances in which Medibank benefits are payable. For example, they will not be payable in respect of life insurance examinations, for immunisation programs in firms and for examinations required in State prisons. Medibank and the funds will pay benefits for workers compensation but the Government will expect reimbursement. The Bill also provides that bulk billing by doctors can continue for doctors who wish to use it. One of the most difficult areas to be settled now will be to renegotiate the Medibank agreements with the States, in particular with my State of Queensland which has had a free health scheme for over 40 years. Of course, this has been effectively destroyed by this legislation. The flak is starting to fly. I hope that the States will be able to come up to a new agreement with the Commonwealth Government that will give them a better choice and a better deal.
– Do you think that Queensland should get a special deal?
– Queensland has had a special deal for many years. I think the fact that it has now lost its free hospitals is another indication of how dangerous it is for anybody, particularly another government, to deal with governments. I well remember the fight that my Premier put up to try to avoid going into Medibank. He told us when we finally were forced into it that we would rue the day. Now the day is here. The basic alterations to the scheme are that everyone can still stay in Medibank but some of us will have to pay for it, either by paying a 2.5 per cent levy on our taxable incomes, by paying a special premium to Medibank or by joining a private fund. A Medibank premium covers public hospital care by public hospital doctors as well as 85 per cent of the standard medical fees. A person who takes out insurance from an approved health insurance company is exempt from the Medibank levy. The minimum cover is the same as that under Medibank with the exception of shared intermediate ward accommodation. A person can insure above this for private ward accommodation and choice of his own doctor, but he cannot insure for above standard fees for either doctor or hospital. The Medibank premium will have the effect of putting a ceiling on the levy for taxpayers with or without dependants. Very shortly, charts are to be produced and will be available to everybody so that people can easily see what options are available to them and so that they can pick out which form of cover suits them and their family best.
The 2 important features of the new arrangements are that the scheme is universal and that levies and premium are scaled to the income scale. The new proposals are supposed to provide incentives for efficiency, cost consciousness and genuine competition between the public and private sectors. I do not see the need for this competition at all but I hope that the private sector is able to show its superior qualities in the contest. One other requirement is that over the next 3 years the medical profession is to institute a system of professional standards review organisations and no doubt a system of accreditation for hospitals, nursing homes and other institutions. At least these requirements, so far, have been left in the hands of the profession which, I take it, is an indication and a recognition by the Government that this is not a proper role for government. I hope that the Government never assumes that role. However, I note that the Government wants to stay in close contact and consultation with the profession in regard to these review boards. I point out that any review of professional standards based on costs is bound to fail.
One provision that is causing the medical insurance funds disquiet is that which states that if the Minister receives evidence that one of the funds is on the verge of insolvency, the Minister can appoint an inspector to look into the operations of the fund. The provisions in regard to access, entry and inspection are now subject to proper procedures by way of amendment to the existing legislation. The inspector then reports to the Minister and the Minister can make a decision on the future of the fund. This decision can be contested if required in the new Administrative Appeals Tribunal. It now has judicial status, is independent and is not subject to arbitrary decisions.
In summary, I state that the advantages of the new and balanced health insurance program are that it will create a substantial decrease in government expenditure and also in the size of the public sector. Medibank has been retainedthat is, universal health care coverage- for both medical and hospital care. There will be a direction of most Commonwealth subsidies to the most disadvantaged. There will be this new specially subsidised re-insurance pool for the chronically ill. There is the provision of incentives which will help to control the continuing long term escalation of health care costs. There is the preservation of the viability of the private hospital sector and the private medical practice in hospitals. The total savings in the Budget will amount to about $800m. I commend the package to the Senate.
– When Senator Jessop was speaking about an hour ago he mentioned again the alleged commitment that he and his Party have to freedom of choice for the individual. If my recollection of recent parliamentary history is correct, Senator Jessop sat for 3 years as a member in the House of Representatives servilely supporting a government which gave this free choice to a section of Australian youth- a free choice to be conscripted to fight in Vietnam or to serve 2 years in gaol. That is the sort of free choice that Senator Jessop supported when he sat in the House of Representatives supporting a government that offered that so called free choice to Australians between 1966 and 1969.
– You are here only because they had more guts than you have.
- Senator Sir Magnus Cormack has referred to guts. I might add that since the subject of guts has been raised, his remarks ought to be directed to those members of the Liberal Party who were of military age and who sat in this Parliament, voted for conscription and forced someone else to fight the war in Vietnam that they had led Australia into with a catalogue of lies. My colleague Senator Wheeldon already has mentioned that this statement of economic policy by the Treasurer (Mr Lynch) has illustrated yet again the Fraser Government’s commitment to antediluvian ideas. He mentioned that no government in the Western world, since the days of Franklin Roosevelt, has ever had such a regressive view of the economy or of the direction of social development. It is worth putting in the Hansard record that although no other national government in the world supports such antediluvian views, the State Government in Western Australia does. I refer to Hansard of the Legislative Council of Western Australia of 14 April 1976. The Honourable Lyla Elliott had quoted an article from Richard Hall in the Bulletin in which Mr Hall had stated that we were seeing in Australia an attempt to put into operation an authentic 19th century conservative philosophy. That observation provoked this response from the Hon. G. C. MacKinnon, who is a Minister in the Government of Western Australia:
What is wrong with that?
Another of his ministerial colleagues in the Country Party, the Hon. N. E. Baxter, said:
It is time we had something conservative.
Then we have the punch line from the Hon. G. C. MacKinnon:
A good workable economy of the type that made the British Empire famous.
Although there is no national government in the Western world which is as antediluvian in its thinking as is the present Government in this city, there is, I regret, very temporarily a government with even more antediluvian views occupying the treasury bench in the State of Western Australia. A Minister in the Western Australian Government has actually stated that he wants to see a return to the days when England was not only the workshop of the world but also the host of the dark Satanic mills.
– The workhouse philosophy.
-Yes, the philosophy of the workhouse, of the triangles, of the hangman’s rope, as my colleague Senator Mulvihill reminds me. There is one thing in the statement tabled by the Treasurer and in the policy as announced by the Government which I must commend. The provision of increased child allowances will effectively redistribute income to the areas of greatest need. I commend the Government for having made this move which has extended one step further the major reform of the taxation system which was undertaken in the Hayden Budget of 1975. In my view the Government has not only underwritten this major reform of the previous Labor Government but has also actually extended it one step further and, I believe, marginally improved it.
On the broad question of economic policy it is at any time difficult to predict what sorts of policies will produce particular responses from an economy. It is especially difficult to make predictions since the postwar era of easy and virtually painless growth has ended throughout the Western capitalist world. But it is clear that the major economic strategy of the present Government for the control of inflation and the ultimate restoration of economic growth or of full employment is pinned upon the Government’s rather simplistic acceptance of the so-called Phillips curve- the doctrine that if unemployment is pushed up inflation will be pushed down as the 2 things cannot co-exist. While there is little doubt that if unemployment is pushed to extreme levels the Phillips curve doctrine still has some validity, on theoretical grounds and on the empirical evidence from the real world, within the levels of unemployment which even the most pessimistic assessors of this present Government would expect in Australia, it is highly unlikely that levels of employment of the magnitude of 5 per cent or 6 per cent or 7 per cent would be completely effective in controlling inflation.
It has become more and more apparent in the last four or five years that inflation can be effectively controlled only if there is restraint on price increases from both the sellers of commodities and the sellers of labour. That sort of restraint requires arbitrary controls which are not available to a national government in this country. The situation may have been quite different if the Liberal Party had adopted a more rational attitude towards the 1973 referendum. That option is closed off, and the only remaining option is the so-called social compact. Of course, to succeed in implementing a social compact a national government must have a great deal of moral authority. The simple and sad fact is that the present Government is totally bereft of moral authority because of the sleazy circumstances- to use Senator Hall’s succinct phrase- under which it seized power and the succession of repudiations of its pre-election policy in which it has indulged since it was elected to office in December last.
Clearly there are also a number of errors and a good deal of slothful thought in this economic policy which has been presented. There are obsessions with obsolete and discredited ideas. Of course, the personification of this is Mr Fraser ‘s simplistic pre-Keynesian belief that the management of national finances is analogous to the management of household finances. I do not believe that any other head of state in the Western world has expounded that doctrine since the Second World War. There was a much ridiculed figure who occupied a position in the Eisenhower Government in the United States in 1957 who rejected Keynesian economics and stuck by this simplistic notion that the management of national finances was analogous to the management of household finances. I do not believe there is another head of state in the world who believes that that is so. Secondly, the economic policy contains some demonstrable internal contradictions and contradictions between the assertions put out in the economic statement and the reality. I will return to that later. For example, it refers to Medibank. Yesterday in the House of Representatives it was revealed that Medibank could not effectively obtain the evidence it needs to implement the Government’s announced policy unless the secrecy provisions of the taxation legislation were breached. That is indicative of the slothful and superficial thinking which lies behind this typically ideologically rooted change in Medibank which the Government has foreshadowed.
Finally, the economic policy has demonstrated once again that the ideological prejudices, which this Government has in abundance, have triumphed over reason. Perhaps the most striking example of this is the investment allowance policy. Although it has been slightly modified since it was first introduced, the rationale behind the policy was that the only way to induce effective economic recovery was through an investment led recovery or an investment boom, and it was asserted that the way to do this was to provide very generous taxation concessions which would induce manufacturers and other producers to embark upon an expansion of their production base in the new investment program, and so on. Bulletin No. 5.7 which was issued, I think, today by the Australian Bureau of Statistics records private capital expenditure for the March 1976 quarter. At the end of my speech I will seek leave to have the sections of this table which I have marked incorporated in Hansard.
What this table shows is that on a seasonally adjusted basis capital investment in the March quarter increased by only $15m. It rose from $ 1,339m to $ 1,354m. In real terms, private capital investment exclusive of agriculture in that first quarter when the investment allowance was operative in fact declined. So quite apart from all the theoretical reasons why the investment allowance would be ineffective in stimulating new investment, the actual statistical information available to date demonstrates that to the present time it has been totally ineffective as indeed anyone would have expected it to be.
Not only has this been extremely costly. The estimated cost to revenue next year is $500m. To have wasted $500m-it has been wasted in the sense that this Government uses the term waste’- is deplorable enough in itself. But let us consider the whole concept of economic management this Government has which focuses on just one aspect, namely the size of the deficit. Because Mr Fraser still believes that Neimeyer and Gibson were correct; because Mr Fraser has this obsession which he has foisted upon his Party; because this Government has wasted $500m in that area, it has cut $500m ofl public capital investment in other areas. Inevitably, this must have a direct effect on the level of employment and ultimately, as always after a primary reduction of employment, a multiplier effect.
Indeed, I believe that at least one senior member of the Liberal Party has been acknowledging in recent weeks that the investment allowance constitutes a classic example of the foolishness of entering into firm commitments long before an election to implement certain policies, no matter how inapplicable those policies may be to the reality which exists at the time the Government implements them. The only statement which I could add to that is that that policy was never appropriate. It was something which was seen by some members of the Liberal Party as a bribe to the business community, and by others as an approach which suited their ideological prejudices. I will say somewhat more about this subject of the investment allowance when the Bills are being debated.
I agreed not to speak for very long tonight but I wish to make just 2 more points. Firstly, I wish to explode the myth that by indexing income taxes this Government has reduced the level of taxation vis-a-vis what it is in 1 975-76. What this Government has done with its indexation of personal taxes is to restore the level of taxation which prevailed under the Hayden Budget in 1975. If the level of real income remained precisely the same in the following year, the proportion of that real income collected in taxation likewise will remain the same. So, if the only change that the Government had made was the introduction of indexation, the level of personal taxation would be the same in the next financial year as it has been in this year.
Students of history would be fascinated by the powerful remarks of assorted spokesmen for the Liberal Party when the Hayden Budget was introduced last year. They asserted that it was a crippling and punitive level of taxation such as would never be inflicted upon the Australian people by any government. I notice that they themselves have opted for precisely that level of taxation, but they have added something to it, of course. They have added a Medibank levy. What this Government has done in fact is to increase personal taxation vis-a-vis what it has been in this financial year. I am very disappointed that that fairly elementary truth does not seem to have been noted in the Press and does not seem to be widely appreciated in the Australian community. It is an inarguable fact.
I turn next to the alleged economies about which this Government has boasted. Somewhere in his statement of Thursday last the Treasurer said that outlays would be less than the Budget estimates this year because of the Government’s good management and so on. What do those alleged economies include? I will name just 3 items. These economies for which the Government claims that its alleged good management is responsible include a $93m discrepancy between the estimates for the expenditure on Medibank and the actual expenditure, $80m which was appropriated for use by the Australian Wool Corporation for the purchase of stocks and which has not been used because sales of wool have balanced purchases, and $75m for the capital expansion of the Australian Industries Development Corporation which the AIDC again decided it would not use. From those 3 areas we find a total and wholly incidental and windfall saving, if one can use that term, of $248 m. It is completely dishonest for the Government to assert that its alleged economic management is responsible for savings such as those which are of a coincidental or incidental nature.
In conclusion I make a moral appeal to the Government, if indeed there is any morality on the Government side. Since it is quite clear that the lynchpin of the Government’s economic strategy is the maintenance of high levels of unemployment, or even marginal increases in the level of unemployment, I appeal to the Government to stop its cynical and continuous vilification of the unemployed people who are the victims of its callous and ill-conceived policies. Mr President, I ask for leave to incorporate in Hansard the table to which I earlier referred.
-Is leave granted? There being no objection, leave is granted. (The document read as follows)-
-I thank the Senate.
– Leaving aside for a moment the particular political philosophies which may have contributed most to the problems of Australia’s economic scene today, it is evident that it is a common problem which bedevilled the last Labor Administration and which now after these 6 months in office faces the Liberal-National Country Party Administration. It is the problem of inflation in this community and all those great problems inflation brings in its train in relation to economic stability.
There is, however, one aspect about the Bills we will discuss which gives me cause for some wry humour. It is that in the course of the passage of the previous legislation incidental to Medibank, I voted with the Labor Government to implement an income tax levy to help pay for Medibank. I was reviled in my own State and, in fact, my political reputation suffered greatly as a result of attacks from the Liberal Party for so doing. It now gives me a great deal of pleasure to entertain the prospect of again voting for an income tax levy to help pay for Medibank, and this time to find that the Liberal Party will be my friend. I hope that this will mend some of the fences which were broken in South Australia and will make those Liberals who were so caustic and so bitter in their criticism and who called me a Labor supporter for so doing, think twice about their previous criticisms.
I am somewhat confused, as I think Australians are confused, by the constant repetition of the terms ‘ business confidence ‘ and ‘consumer spending’. There is an emphasis which runs through this debate here in the Senate and in public that all we need to do is to have a rise in business confidence and a rise in consumer spending and there will be no more economic tribulations to face this Government or this community. This puzzles me. What is, after all, business confidence? Is it some mystical thing that a businessman suddenly gets after he has had a good dinner, or does he read a new Government statement and say that he will rush out and buy new capital equipment? Surely in practical terms it means opportunity. Business confidence is not something that one can artifically engender at the head of a business. Boards will act and invest only if there is an opportunity to make a profit from serving the community in their particular field.
As far as consumer spending is concerned, this would be the basis of increased sales locally of many products made in Australia but it would not be the only element needed to bring back stability to the Australian economic scene. We are not in isolation even though many of our policies would indicate that the Government and many of us think we are. There is one very real instance of government policy in Australia which would lead us to think that we are in isolation and that is the policy in relation to our motor vehicle industry , one of the most foolish policies ever generated in this country. This is a country with a market for under half a million vehicles a year, a great number of them being supplied by imports, and we are actively encouraging 5 major manufacturers here. This is going in the face of economics in relation to the motor vehicle industry across the world and the Government, as much as the previous Government, in this regard should consider how many manufacturers in the United States make over 50 000 motor cars a year, how many in Sweden, how many in
France and how many in Germany. It will find that this country cannot afford the present policy we have on motor car manufacture.
It is a prime example of how Australia lives in isolation and establishes a tariff barrier to increase production in one of the most inefficient industries in the world in terms of output per man and price per vehicle. But putting that aside, it is the cost structure of this country which is paramount in all we are talking about. There was a very dismaying leading article in the Bulletin issued today and headed ‘Australia Unprofitable’. It should cause all those who talk about business confidence a great deal of thought. I shall read an exerpt from the article. It states:
At today’s prices many of our richest mines, our most fertile land, our prime real estate development sites have basically become unprofitable prospects. Paul Phillips, of the Australian Mining Industry Council, lobbying for devaluation, says projected costs of the top 40 mines nearly doubled in the past 18 months.
The article goes on to say that a bitumen driveway at a Port Hedland motel cost $ 1 5,000 to put down in 1967. After cyclonic damage this year the cost of replacement was negotiated at $58,000. The article continues:
Little would exist today of Australia’s great wealth producers, the farms and mines, if the investment had to be justified within the present framework.
The article mentions high rise buildings and states:
In the present soft leasing market, office rates are below $5 a square foot on big areas. To justify a new building like the NM -
That is, the National Mutual building - rents would have to go to $ 1 3.
I invite any honourable senator to contemplate investing a multi million dollar sum in Australia today in a productive enterprise, and I do not mean selling goods from one to another, dealing in real estate or speculation but adding value to an object or objects. I invite any honourable senator to state the profitable investment into which he would put a multi million dollar sum of money. The more we survey the scene the more we will find that Australia is an unprofitable country. The profits are being made on investments on past day values. All of us have friends in small industries. I have many such friends who have said to me: ‘How I wish I could get out of this enterprise’. Costs, incidental in so many people’s minds, loom so large to entrepreneurs. I was told by a prominent motel operator recently that the wages of a dishwasher in the United States of America are lower than they are for dishwashers in Australia. To conclude this brief reference to small businesses, there is no doubt that small businesses have fallen between the 2 power groups in Australia, the unions and government, and it is not enticing to consider the prospect of entering small manufacturing processes with all the incidental costs and pressures which are loaded against them.
The main component of all our problems is the still accelerating rise in wages in Australia. The argument is that they should remain safe against all pressures by the indexation which is complete and which will make the first claim on the economy of this country to be paid to wages. As long as union power is sacrosanct in support of a full indexation I believe that no government policies will be successful in meeting the problems which are being debated here. In fact, one of the only ways that industry has of meeting a fully indexed wage structure is to replace people with machines. I talked recently to one industrialist who told me that his firm had put off 700 people last year and replaced them with machinery and was intending to replace another 500 people in 1976. It was the only way in which the firm could remain viable and show a minimum profit on the funds which had been invested.
If profits are as low as they obviously are, so frequently calculated on values which are put there by inflation and are not expressed in real terms, there is only one way in which there can be any saving time, any grace time, for catching up with the cost structure in Australia and that is by breaking the automatic full indexation of wages. That is the greatest job that the Government has before it. I also believe that surely in the minds of those people who have produced what is called this economic packet is the knowledge that what we have seen so far is only the laying of the groundwork for further and more important action on the issue of wage restraint. This package is only beginning to lay the ground to moderate wage indexation and to relate it somehow to productivity in Australia. No doubt the emphasis on child endowment and the social justice which it brings is an excellent beginning to asking others to bear some cost which is needed to relate Australia’s economic costs to those of its trading partners.
I would say too that the new federalism policy which has been talked about so freely has hidden dangers which ought not to be so hidden in the cost structure of Australia. One of the most inefficient economic machines of all 3 tiers of government is the State government tier and to remove the spending power from a Federal government and place it in the hands of a State government is to reduce the value and efficiency of that spending. Any regard for the day labour forces of the States of Australia will clearly show that political ideology has nothing whatsoever to do with the growth of day labour forces. I would like to have the statistics on how many are paid weekly around Australia by State governments to do ineffectively and with about two-thirds of the efficiency jobs that could be done by private contractors.
One of the issues which the Government is ignoring apparently in offering States the capacity to levy an income tax is that they will build their day labour forces quite contrary to the political philosophy of the Liberal Party. One of the conditions that should be applied if the States are to gain income taxing powers is that they reduce those day labour forces and introduce far more contract work into their very large physical operations which involve the spending of their capital funds. It is a joke that the hardest jobs in State government are given to private contractors to do because it is too hard to assemble day labour government forces to complete the jobs. In South Australia there is an excellent example. The hardest and toughest road construction project the State has known is the finishing of the connection of the sealed link across the Nullabor to Western Australia. This has been completed, over 300 miles of it, by private contractors. One does not find private contractors within 100 miles of Adelaide. The hardest jobs are done in that way; the more comfortable ones are accomplished at a much more leisurely pace and at much greater cost by day labour under State governments. This one factor of the so-called federalism policy of returning spending power to the States will add to the ineffectiveness of the economic recovery of this country.
The cost of production in this country is something that the Bulletin article has dealt with and there have been many references to the growing cost of production compared with that in the United States of America, Japan and others of our trading partners. We have already an enormous tariff barrier to protect motor vehicle manufacture here, as we have for many other Australian industries. AH of us would want to see our industries protected against cheap labour from overseas, especially in countries where the living standard in no way approaches that of Australia. But we are protecting Australian industries today against countries which have living standards equal to our own and we are doing so in a way that makes our exports almost incompatible on an overseas market. The warning is clearly there, that to develop business investments today in Australia and expect to compete on a world market is almost an impossible prospect given the rate of inflation which we have and the full indexation of wages which apparently is to be supported by the strong trade union movements in Australia.
Unless we can receive moderation in these fields; unless we can recognise that Australia has a very small percentage of its work force with a high level of salaries and wages- in fact, I think that only 3 per cent of the Australian work force is paid over $30,000 a year, which by international standards would be a very low figureunless we can understand that there are no sacrifices that we can ask the tall poppies to make which would be sufficient to cure Australia’s economic ills, and understand that all of us have to take some part in creating the stability which this economic package calls for; and unless the union movement can understand that it is directly involved in that, there will be no satisfaction and this economic package will all in vain. The package has my support, Mr President, especially the levy for Medibank under the conditions which I mentioned previously. I do hope that the Government sees this as laying the ground for firmer action to ask for restraint and to expect to obtain restraint. I hope that that will thereby break what is the most insidious problem in Australia’s economic scene- the rate of inflation, coupled with interest rates which are automatically high at the same time- and that it will do what is necessary to achieve a reduction in inflation because that is the only way in which we can develop the wealth of which we have so much in this country.
– in reply- It seems a long while ago- I think we have had two days and almost two nights debate on these issues- since it was agreed that we would debate together Appropriation Bill (No. 3), which is the basis for general revenue appropriation expenditures; Appropriation Bill (No. 4), which covers largely the capital works area; the economic policy statement which was introduced in the Senate last Thursday evening and took something like 1 Vi hours to read; the legislative measures that come out of that statement, such as the education proposals and the general area of health and Medibank; and the statement on defence policy. All these areas have been covered in the broad area of this 2-day debate. Therefore, it seems to me, having listened to some of this debate and having been unable to listen to other parts of the debate, that I should not be very long in replying. In fact, I shall be extremely brief.
Senator Carrick dealt at length with the general proposals dealing with education, Senator Guilfoyle dealt with the proposals in relation to health and Medibank and Senator Withers put down a statement on defence. Many other people have spoken about a very wide range of subjects, and as I listened to that part of the debate that the other pressures of work enabled me to listen to, I found the contribution from both sides interesting. Probably I shall take some time later to read the full Hansard record of this debate, because the issues that are being debated are fairly serious and one would want to be able to take account of observations by all honourable senators, although one might not necessarily agree with many of them.
Let us look back to the origins of all these issues. First, we go back briefly to a point of time when the previous Government inherited the government of Australia. At that point of time, put in simple terms, Australia had a very low inflation rate, a very low unemployment rate, an economic growth rate that was quite positive and was what might be described as a reasonably prosperous country. After 3 years the Labor Government lost office and we inherited the operation of government. What did we inherit after 3 years? We inherited almost the highest inflation rate in Australia’s history, except for one very slight episode during the Korean War, the highest unemployment rate since the Depression and an economic growth rate in minus or nil figures. That is what we were given an electoral mandate to overcome. At the time of the general election many people, myself included, pointed out that a country would not recover very quickly after 3 years of that sort of treatment; it would take some time. That ought still to be regarded as a fact of life and as essentially the truth. Therefore, one would pay regard to anything that any honourable senator has said which would make a distinctly sensible contribution to the economic recovery of this country and to restraint. But the current Government has an electoral mandate, given to it by the people, to do what it can to get Australia back to a sensible position. This will take time and will not be an easy job.
The Government has what I might describe as a 3-phase approach to this problem. Without doubt its first job was what I call a tidy-up. Its next job, having achieved that, was to create a situation of stability, understanding and overall restraint and involvement, because it has been quite truthfully said that unless all the elements of Australian society work together to solve Australia’s problems the problems will not be solved. They will not be solved by taking stand-off positions and by taking positions of mutual hostility. That will solve nothing. If a situation of stability can be created- I believe it is being created- then I am sure that the country will return to a situation of economic growth and development and increased prosperity. In that context once inflation is brought within bounds there will be an improvement in employment, a greater opportunity for the Australian people and a genuine rise in their living standards. That is a fact of life and it is the broad aim of the Government.
I suppose that the key factor in this debate is the economic statement because it represents 6 months of hard work trying to tidy up a scene and to create in that tidying up a movement towards stability and growth. So let us look very briefly at some of the factors of the problem which we face. Let us consider first of all Budget expenditures, as such, and their growth rate in recent years. In 1972-73 there was an increase of 13 per cent, in 1973-74 an increase of 20 per cent, in 1974-75 an increase of 46 per cent and in 1975-76, in the Budget of the last year of the Labor Government there was an increase of over 20 per cent. We can argue as much as we like, but most people will agree that on the accumulated evidence, despite their philosophical views and resort to various economists and crystal balls and the casting of entrails on the ground, this growth rate in Budget expenditures has aggravated inflation, has bloated the public sector and has therefore increased substantially the area of public service control and management. That sort of behaviour always brings in its train substantial waste and extravagance.
The forward estimates that we inherited pointed once again to the tremendous inaccuracy of the previous Government’s budgetary and economic forecasting. We were looking at an increase in expenditure because of overrun figures substantially greater than the Budget figures of 1975-76 had predicted. Of course, we expected this, because in opposition we had experienced previous Budget inaccuracies by the then Government. There were all sorts of inaccuracies. For instance, if we go back to the 1975-76 Budget we see that an economic growth rate was assumed to be able to be achieved. Instead of showing an economic growth rate in positive terms of the 4 per cent or 5 per cent predicted for the calendar year ended December 1975, there was a minus growth rate. These were the types of inaccuracies that we inherited and that we had to bring under control. These huge increases in expenditure, well beyond sensible capacity, had to be cut back to help in the battle against inflation, to eliminate the waste and extravagance and to provide for the Government’s own initiatives- that is, to introduce tax indexation and to do something more for the people in the community who are not as well off as other people.
In the broad pattern of what one is seeking to do one must always select one dominant aim. If one seeks any kind of success in bringing things within control, there has to be a dominant aim. The dominant aim of this Government expressed at election time and expressed again in the statement is to bring inflation under control as soon as possible. The Government, in that endeavour, needs the support of the whole community and the support and the understanding of the Parliament. If we look at these situations through any economist’s eyes- whether he is from one side or from the other, pre-Keynesian or postKeynesian, or anything else- we have to recognise that what we are dealing with is the total demand which is placed by society on governments and the resources available to meet those demands. That is what we have to face up to.
In the previous 3 years the demands placed on resources by governments of all types were far in excess of the capacity to meet those demands. Some people ask: ‘Why do you not borrow?’ Do not those people realise that that still does not fix the problem? If we borrow, then the future situation has to take into account the repayment of over-expenditure against available resources. So looking at the overall position we set out to tidy up by eliminating waste and extravagance as far as possible and by reducing expenditure to within some bounds which will allow us to bring those demands gradually into balance with the available resources.
The original forward estimates of expenditure have been reduced by approximately $2,600m. These are reductions on the projected 1976-77 figures, not on actual figures. When these figures are established and compared with the 1975-76 figures we will see that there will be relatively few cuts. Total outlays in 1976-77 will be higher than in 1975-76. Somebody might ask: ‘How much higher?’ That cannot be determined until the final Budget figures are known. The forward estimates are confidential to a government and at the moment we cannot disclose these figures. We will not have them in precise terms until the end of the financial year. We have to wait for the revenue situations to accumulate so that we can get the final position. All the decisions we have taken so far will be reflected in the final Budget documents which will contain the whole of the revenue position. I think that covers the broad situation.
One or two factors were mentioned in the debate by honourable senators on the opposite side. I could not possibly sit here all the time and take note of everybody’s objections, praise, difficulties, apprehensions and suggestions. But very few honourable senators addressed themselves in any detail to the economic impact of the package. Some did. I acknowledge the contributions of the last 2 honourable senators who spoke in this regard. I do not agree with all they said. But they made an economic impact when they thought and spoke about this matter. A theme which ran through the speeches here and, I think, more in the speeches in the other place was the fact that one should not be at all concerned about the deficit. What we get from this point of view is that what is required is to prime the pump to solve the problems. I suggest that there has been so much pump priming over the previous 3 years that no water is left in the well. One thing that should have been learnt from the experience of the previous 3 years is that governments cannot spend their way out of inflation. Government expenditure is still expenditure. The problem is still the total demand that is placed on the community as against the available resources to meet that demand. I remember that last year when Mr Hayden presented his Budget he made some observations which seem to me to endorse the present line of action taken by the current Government. He stated:
For these reasons the keynote of this Budget 1975-76 is consolidation and restraint rather than further expansion of the public sector.
The problem which Mr Hayden had was with the inaccuracy of the forecasting. I believe that this was very much due to the miscalculation of the effect of the overrun of previous extravagances and a calculation of economic growth rate which was not realised. Instead of being a plus it became a minus. Of course, the problem was that the realisation was rather late and the accumulated problem was too great to overcome. But the general thrust of what Mr Hayden said was, in effect, similar to what we are saying here in much wider and longer terms. An implication of what honourable senators opposite have said is that the Government is moving to emasculate the public sector. That is not true. The Government has said that there must be a better balance between the public and the private sectors and that growth in the public sector must be constrained by the ability and the willingness of taxpayers ultimately to finance that growth.
For our part, we want to get back to realism. Equally, we want to protect and as far as possible to increase the major areas of government activity, including spending on pensions, family allowances, education and defence. I think all the figures have demonstrated the Government’s anxiety to see to it that governments show restraint, that they are honest with the taxpayers and that they look after, as far as they can, the poor and the needy in their society. This is the broad picture of what the Government has set out in its economic statement. The same sort of thrust will go through the Appropriation Bills. We will move into the same sort of situation when the Budget is put down in the Senate some time in August. I hope that the economic debate in the Parliament will continue. I hope that the quality of the economic level will continue to rise. I argue once again, as I have argued all my time in the Senate, that the Senate is the place where longer term issues of budgetary, monetary and economic policy can be taken and thought through carefully. I think Australia is well served if the Senate is able to engage in that sort of debate.
I think it is equally true to observe that it is unlikely that many people will agree with anybody else on what they understand to be the true economic merit and the true economic wisdom of a situation. That does not matter greatly. What matters is that we get a great mix of people’s views and of people’s minds in order to solve problems. The problems will not be solved if people start taking hostile attitudes, one against the other. This is now a community problem of a serious magnitude. The Government has moved to do its part in its first 6 months. It has stated what it has tried to do. It has been quite precise. A great part of the problem will now pass to the trade union movement, to the Conciliation and Arbitration Commission, to State governments, to consumers, to the business community and to the people of Australia as a whole. If they have faith in their country and a belief in its future they will join with this Government to make that faith and that future become real.
Question resolved in the affirmative.
Bill read a second time.
Motion (by Senator Cotton) agreed to:
That consideration of clauses 1 to 7 be postponed until after consideration of the Schedule.
– I move:
I point out to my colleagues that a schedule has been circulated. It should be on every honourable senator’s desk.
Question resolved in the affirmative.
Proposed expenditure, $26,223,000.
Proposed expenditure, $3,485,000.
Proposed expenditure, $8 1 9,000.
Department of the Prime Minister and Cabinet
Proposed expenditure, $6,92 1 , 000.
Proposed expenditure, $2,5 13,000.
Department of Foreign Affairs Proposed expenditure, $14,342,000.
Department of Defence Proposed expenditure, $8 1 , 6 14,000.
– I draw the attention of the Committee to the report prepared by Senate Estimates Committee A following consideration of the estimates for the Departments of Administrative Services, the Parliament, Prime Minister and Cabinet, National Resources, Foreign Affairs and Defence. Might I say that the Estimates Committee gave detailed and careful scrutiny to the estimates presented by the various departments. I draw the attention of the Committee particularly to paragraph 3 on page 2 of the report of Senate Estimates Committee A, which states:
The Committee is anxious that Estimates Committees should carry out their important supervisory role as efficiently and effectively as possible. For that reason the Committee makes the following points:
It is essential that departmental explanatory notes should be in a form that contains sufficient detailed information.
Might I interpolate that most of the reports of the departments dealt with by Estimates Committee A contained sufficiently detailed explanatory material. The report continues:
This applies particularly to breakdowns of amounts which might be described as’group’ amounts, in relation to which it might clearly be anticipated that such details would be sought. The Committee accepts that it may not always be easy for departments to anticipate what items may require further detail, but considers that, in most cases, a greater effort should be made to provide such breakdowns.
Although the question of the early provision of the explanatory notes has been referred to previously by thus Committee, and by other Committees -
I particularly draw the attention of the Committee to the following words: . . it is suggested that, for the consideration of the main departmental estimates during the Budget sittings, and in future years, the operation of the Estimates Committee system would be greatly enhanced if the explanatory notes were made available to members at the time of the presentation of the Appropriation Bills to the Parliament. This would give adequate time for consideration well in advance of the sittings of the Committees. It would also make possible a practice which this Committee proposes to implement, if practicable, and which it recommends for the consideration of the other Committees -
I emphasise that- . . the preliminary examination of the explanatory notes, in private sessions, prior to the public hearings of the Committee. Such a prior consideration could quite possibly lead to a clarification of proposed areas of particular examination and concern and, perhaps, a decrease in the numbers of departmental officers required to attend at the subsequent hearings. Such criticisms as are made of the system include references to lines of questioning and numbers of departmental officers in attendance, and it appears to the Committee that its proposal for a ‘pre-examination consideration’ might assist the smooth overall working of the Estimates Committees ‘ operations.
Mr Chairman, I deliberately read into the record those recommendations of Senate Estimates Committee A. If the system of Estimates committees is to continue, and continue to be effective, we believe that the system has to be improved, modernised and updated. We believe it is wrong that so many public servants should be sitting around in the precincts of this chamber for hours on end during a day or for days on end during a week, waiting to give evidence or present details to an Estimates committee, when in the vast majority of cases they are not required to utter a single word.
The opinion of Estimates Committee A seems to be reinforced by the report presented to the Senate today by Senator Sir Magnus Cormack on behalf of the Joint Committee on the Parliamentary Committee System. I refer the Committee of this Senate especially to page 5 1 of that Committee’s report. Without reading the remarks of the Committee into the record, I suggest that the comments it made are inter-related with the recommendation of Senate Estimates Committee A. The members of Senate Estimates Committee A believe that the Estimates committees play an important part in the deliberations of” this Parliament, but they should play and can be made to play an even greater and more effective part. After all is said and done, this is the only opportunity for members of the Parliament to meet members of the bureaucracy and ask them to explain the recommendations that they, the members of the bureaucracy, have put to the Executive and the recommendations which, having been put, have been accepted by the Executive. While it is easy for the members of the Executive to explain the estimates of their own departments, might 1 suggest that there is some difficulty- as a former Minister I know that there is considerable difficulty- in explaining the estimates of other departments on behalf of other Ministers.
I believe that there is great merit in the suggestion put forward by the members of Estimates Committee A to this Committee of the Whole that the estimates of the various departments should be presented to the Parliament at the time the Budget is presented. The members of the various Estimates committees could then meet in private and consider the estimates and the explanatory notes that have been provided by the bureaucracy on the manner in which it is intended that the expenditure should be incurred. The Committee, acting in conjunction with advice which might be given to it by experts made available by the Parliament from time to time, could then consider the details contained in the estimates and in the explanatory notes. Thereafter, if any amplification is required, members of the Public Service- members of the bureaucracy, for want of another word- could then appear before the Committee to better explain the individual items. The members of Estimates Committee A believe that such a course would save a considerable amount of public expenditure. It would save a considerable amount of the time of members of the Senate and it would make more effective and more efficient the presentation to the Parliament of Australia of the various Estimates committees’ reports. Having said that, I recommend it for the consideration of other Estimates committees and for the consideration of Ministers, particularly the Minister representing the Treasurer.
Having dealt with that matter, I now wish to refer to other matters that are within the purview of the Departments of Administrative Services, the Parliament, Prime Minister and Cabinet, National Resources, Foreign Affairs and Defence. I think it is fair to say that all those matters were dealt with in a most detailed way by members of the Committee. I wish to refer briefly to 2 aspects. Firstly, I refer to the second annual report issued in 1 974 by the Australian Council for the Arts which was presented to the Parliament one or two days after consideration by the Senate Estimates Committee of the estimates for the Department of the Prime Minister and Cabinet.
-Is that 1974, Senator?
-The annual report by the Australian Council for the Arts for the year ended 1974.
– Who was in office then?
-We are not worrying about who was in office. The honourable senator should not play politics on these things. We are talking about the efficiency of the Parliament; we are talking about the supremacy of the Parliament over the bureaucracy. If Senator Wright wants to play politics between the Liberal Party and the Labor Party or between the Democratic Labor Party and the National Country Party or any other political party he can do so as much as he likes, but I am talking about the right of the Parliament to be informed.
– Is that the year in respect of which the Public Accounts Committee and the Auditor-General took such an interest in its affairs?
-Yes, it was during that year. If honourable senators look at the report of Estimates Committee A they will see that additional material was supplied as a result of interrogations that were made during the course of the Senate Estimates Committee hearing. To all intents and purposes prime facie the second annual report of the Australian Council for the Arts for the year 1 974 was presented to the Parliament on or about 2 1 May 1976. Without going through the various passages one will see that details set out in the report relate to the period March or April 1975 after the enactment of the Australia Council Bill.
I am suggesting that the second annual report of the Australian Council for the Arts for the year ended 1974 should have been presented to the Parliament 12 months in advance of the time it was presented, and that it was probably only as a result of our interrogation during the second Estimates Committee hearing that this report came to light at the time it was presented. Whilst I am told that according to the report further supplementary details are to be submitted for the period from March 1975 to June 1975, I say frankly it is not good enough. The information accorded to me, rightly or wrongly, is that the Australia Council spent some $35,000 on the production and printing of this report, and that the Australia Council after the report was printed received and considered the report and believed that certain pages had to be deleted. It was because of that uncertainty that the presentation of the report to the Parliament was delayed and deferred. I suggest that that sort of thing is not good enough for this Parliament. If any government is concerned with bringing about economies of operation, it should concerned with this sort of thing. If Parliament is concerned with the efficiency of government, it should be concerned to see that the reports of departments and particularly of statutory authorities, which appear in the modern day and age to be laws unto themselves, are presented within a reasonable time after the end of the financial year they cover.
If this Parliament is to be sensible and responsible in the scrutiny of expenditure of public moneys by departments and statutory authorities, it should be the responsibility of every member of every Estimates Committee of this Senate to ensure that, before the estimates of the departments and of the statutory authorities are proceeded with and discussed, debated and approved by the Parliament, the annual reports of the respective departments and authorities are before the Parliament and therefore before the Estimates Committees.
– Order! The honourable senator’s time has expired.
– I would like to say a few words about the matter which Senator Douglas McClelland raised in the early part of his speech. The matter should not be allowed to pass with comment from just one member of the Committee. I think there should be comment from another senator. I think that the recommendations which Estimates Committee A makes would ring a bell with many other honourable senators who feel that whatever good may be coming from the consideration of estimates- there is a lot of good- they are not entirely satisfactory and that in fact much of the work that is done disappears into the sand. Perhaps the examination before the Estimates Committee is not completely satisfactory. Sometimes this is partially due to a sense of decency on the part of honourable senators who have not had time to look into a particular aspect but feel that the officers of a department are present and that therefore they should be asked some questions. I do not think we get a thorough examination if the departmental documents are before honourable senators for only a short period before the examination takes place.
I hope that the suggestions which this Committee makes do become of general application. I do not know whether it is entirely practical- it may not be- that all the explanations can be available at the time the Budget Estimates come forward, but I do think that the explanations could be available very much sooner than has been the custom in the past. I hope that the ideas which the Committee has put forward, including this pre-consideration and discussion as to what matters are to be dealt with and concentrated on, will be taken up and their practicality examined. I think we should bear in mind that in the short period I have been here there have been changes so far as honourable senators are concerned. Honourable senators have additional staff. They have people who can do an examination and collect material, therefore assisting honourable senators who are sitting on Estimates Committees to make a proper examination of the material before them. I think the staff cannot be properly used if the detailed material comes before us a day or two before the hearing. Obviously further time is required so that the best use can be made of this method.
I certainly appreciate what this Committee has put forward. I hope it is not lost. I hope it in fact goes forward and becomes of general application. I believe that the Estimates procedure is a good one but one that is faulty in its examination and, in its final analysis, not as good as we can do. Therefore I add my commendation to the recommendations of the Committee.
– I want to say a few words on the subject which was introduced by Senator Douglas McClelland and followed up by Senator Missen. I too found some confusion because of the late delivery of the Estimates papers. I also found a great deal more confusion in the way the explanatory notes are compiled. I do not know whether this is done deliberately or whether it is done because the people who compile these documents are not aware of what is required, but I think there should be some streamlining of the papers that are put before the Senate. In answers to questions without notice asked in this place Ministers say that the information sought does not relate to their department and that some other department handles it. An honourable senator may attend an Estimates Committee because he wants to pursue some matter but he has to leave it because he finds that in the Budget Papers it is detailed as coming under another Committee. When the honourable senator gets to that Committee to pursue the question he is told that he should have asked it at the previous Committee.
An item concerning the Department of Administrative Services is included in nearly every department’s estimates. The same applies with the Department of Construction. I feel that all of those items should be grouped together. If they are not, some document should be supplied to honourable senators explaining just where those items can be found before an honourable senator attends an Estimates Committee. Some honourable senators sit in on an Estimates Committee, like I do when I am not a member of that Committee, wanting to pursue a certain avenue. When you get to that committee you are told that the matter should have been dealt with by the committee of which you are a member. I have had some run around in the last week. I have been to two committees in particular, Estimates Committee A of which I am a member and Estimates Committee F where I wanted to obtain some information. The information which I wanted concerned the non-payment of the use of government cars, a topic which was raised in the House of Representatives when we were in Government. It refers to the non-payment of the use of cars by Mr Sinclair. He claimed he was entitled to hire Avis rental cars. Mr Daly, the Minister for Administrative Services, refused to pay that debt.
I wanted to pursue that matter. I went along to Committee F, which deals with matters relating to the Australian Capital Territory. Senator Withers has said in this Parliament on many occasions that he is not responsible for the use of cars in the Australian Capital Territory, that that is the responsibility of the Minister for the Capital Territory. I let that matter pass over from Committee A. I went to Committee F after Committee A had finished its work. I posed the question. I was politely told that this matter came under the responsibility of Committee A, that it should have come under the Department of Administrative Services. Where do I go? I cannot get an answer. I have to waste the time of the Committee tonight to pursue that matter.
There are other matters. I refer to the disbandment of the River Murray working party. When I sought that information at Committee A under the estimates of the Department of National Resources I was told that although the River Murray Commission is responsible to the Minister I could not get an answer because the Commission is a statutory body. Yet public money is involved. I want to know who gave the authority to disband the River Murray working party. Four governments were involved in the setting - up of the River Murray working party- ti South Australian Government, the Victorian Government, the New South Wales Governeme- and the Australian Government. They are parties to the River Murray working party agreement. The Prime Minister (Mr Malcolm Fraser) disbanded that body without consulting the State Ministers. The disbandment has caused great concern in South Australia. We depend on good quality water coming down the River Murray to service almost every person who uses water in the State. I wanted to pursue that matter in Committee A. I was given the run around. Nobody will accept responsibility. I want to know who gave the authority to disband the River Murray working party, when it was given and why it was given. Surely I can get that information. Public money is involved.
Another thing which I wanted to pursue came under the estimates of the Department of Construction, I thought. It referred to extensions at Government House. I raised that matter. If ever anybody has been given the run around, I have on that issue. I cannot get any information. All I got when I pursued that under the Department of Construction estimates on Committee F- after a lot of hard work, mind you, and a lot of questioningwas an answer sent back to me which is not worth a crumpet. This is the answer:
In response to a question by Senator McLaren, the Department -
That is the Department of Construction- undertook to furnish information relating to any work currently being carried out at Government House, Canberra. Work is being carried out at Government House, Canberra, by the Department of Construction on behalf of the Department of the Prime Minister and Cabinet.
There was an item for the Department of the Prime Minister and Cabinet under the Department of Construction, which was handled by Committee F. The reply continued:
It is being funded by that Department and not from any Appropriation under the Department of Construction. Work is being executed by day labour.
Why cannot I get an answer?
– This is not worth a crumpet.
– Of course the answer is not worth a crumpet. I wanted information. Who authorised the work? What is the cost of the work? What is the purpose of the work? Yet I was given the run around. The department finally admitted that the work is being carried out.
-Who is the Chairman of Committee F? Is it Senator Wright?
– I am not blaming Senator Wright, because he did everything he could to help. I give him credit for it.
– He is not shirking his job?
– No, he is not. He has done a good job. I shall read from the Senate Hansard of Estimates Committee F of yesterday. It sat to conclude its portion of the Estimates. The Chairman asked Senator Webster, the Minister responsible, to get the information that I sought. The Chairman said:
I am quite sure that a telephone call to your Canberra office of the Department of Construction would get all this within 10 minutes.
The Chairman was referring to the information which I wanted. Senator Webster stated:
All right, I will get the information to you, Senator.
I have not got it. Why have I not got it? Surely the Department of Construction has admitted in the letter to the Chairman, Senator Wright, that the work has been carried out. But I have no answer. This is the question which I posed yesterday morning.
– Order! I suggest that Senator McLaren contain his remarks to Committee A. We are dealing with the report of Committee A. I allowed him to digress because he referred to Committee A and to the problem of obtaining imformation from other committees. I ask him to return to the area of Committee A.
-I have been told that the work referred to in that letter is the responsibility of the Department of the Prime Minister and Cabinet, and that is under Committee A. The crux of my complaint is the run around which I have been getting. This matter comes under Committee A. I sought that information. These are the questions which I want answered. I hope I will get an answer tomorrow. Senator Webster, the Minister responsible, wanted the information in writing. I gave it to him. I had it recorded in Hansard. I said this:
Well, to help the Minister, perhaps I could have on the record what I am seeking: I want to know the nature of the work; the total cost of the work; who authorised the work; the date of authorisation; the date of commencement; the expected date of completion; and the number of persons engaged on the site.
I was told that it is the responsibility of the Department of the Prime Minister and Cabinet. So I pose that question now in respect of Committee A to whoever is responsible for that department. Could someone provide me with that information? Public money had been expended at Government House. Most capital works in the Australian Capital Territory have been put on ice. No work is being done. Yet the Prime Minister, who is responsible, can find the money. What this amount is is what I want to know. He can find the workmen to go to Yarralumla and do construction work when there is plenty of other construction work that ought to be done in Canberra. I cannot get an answer. Why not? Is the Department of the Prime Minister and Cabinet trying to cover up something? It must be or it would give me an answer. I pursued the matter at Estimates Committee A last week. I pursued it yesterday at Estimates Committee F. I cannot get an answer. Is the amount of money involved in this item such a large amount that the Department does not want the public to be aware of it? I want that information. Other information which I sought at Committee A, for the sake of clarification, was -
– Why I had 2 officers in Tasmania.
-Yes. I have not got it yet. The other information which I sought was the extra expenditure of $60,500 under the Department of the Prime Minister and Cabinet, added to the $38,000 which had been appropriated in 1 975-76, for funds required to meet the cost of the Governor-General’s official visit to the United Kingdom and Europe from 23 December 1975 to 3 February 1976. 1 cannot get an answer to that. When I posed that question at Committee A, of which I am a member, to the Leader of the Government in the Senate (Senator Withers), who is the Minister concerned, he told me- I was aware of it- that the Prime Minister in answering a question on notice to Mr Morris in the House of Representatives would not give an answer. He would not tell us where the Governor-General had been in Europe, what his business was. When one works out the cost, on my calculation, the Governor-General, who was out of the country for 42 days, with the extra appropriation which is just to meet some of the cost, spent $2,345 a day of taxpayers’ money to flit around the world. Yet the previous Prime Minister was often criticised by senators opposite when he was overseas on business, doing the work which he was elected to do. It is funny that when Estimates Committee A was sitting on Tuesday, 18 May, I could not get an answer about the extra $60,500. Yet on 20 May, 2 days after the Committee sat and I could not get an answer, Mr Fraser gave and answer to a question on notice in the House of Representatives.
– Quote the page number.
– It is page 2362, Question No. 457. Mr Morris wanted to know some of the things I wanted to know. Mr Fraser replied:
Costs of the visit have not yet been finalised.
The Department is asking for an extra $60,500. How much more did the visit cost?
– Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question:
That the Temporary Chairman do now leave the Chair and report to the Senate.
Question resolved in the affirmative. (The Temporary Chairman having reported accordingly.)
– Order! In conformity with the sessional order relating to the adjournment of the Senate I formally put the question:
That the Senate do now adjourn.
- Mr President, I ask for leave to give notice of motion for the introduction of a Bill.
-Is leave granted? There being no objection, leave is granted.
– I give notice that on the next day of sitting I will move:
That leave be given to introduce a Bill for an Act to make provision for and in relation to industrial research and development including the payment by the Commonwealth of incentive grants.
– I do not intend to keep honourable senators long this evening. When I receive answers to questions upon notice, I read them of course. But other people read them also. A person who read one of the recent answers to a question that I placed on the notice paper gave me some information which suggested that the answer did not reveal the total picture and that there were some definite omissions in the answer. I refer to the question answered on pages 1690 to 1693 of Senate Hansard of % May 1976. The question reads as follows:
asked the Minister for Administrative Services, upon notice:
A similar question was asked in relation to each Minister in the House of Representatives. The answer which was given to me covered Ministers in both Houses of the Parliament. Following information which I have received from private sources, I pose the following questions in relation to this answer: For each of the Ministers mentioned, do they have electoral secretaries and/or electoral research officers? If they do, was there any reason why these persons were not included in the information supplied in the answer? Could that additional information be supplied? A paragraph of the answer recorded on page 1690 states:
In view of the honourable senator’s concern, he will be pleased to learn that the present Government has reduced the number of ministerial staff from 242 as at 10 November 1 97S under the Labor Government to 1 66.
I also ask whether that figure of 166 is correct. My calculation is that there are 106 ministerial staff listed in the answer. I would like to know where the other 60 people are.
– Did you count the staff of Senate Ministers?
-I beg your pardon, Mr Minister; that is probably the answer to that question. I finally ask this question, which is probably the crux of the whole matter: Will the Minister have the information checked and advise the Senate of its accuracy as it does not correlate with some of the information which has been passed on to me?
– I supplied that answer and I was assured by my Department that those names, designations, salaries, etc., were correct. If Senator Colston has information which shows that they are not correct, I think the onus is on him to give me that information. I must say that I take the Department’s word that, according to its records, those names, designations, salaries and departments from which those persons were seconded were checked and rechecked. In fact, it was thought that a couple of names were wrong. On rechecking it was discovered that the names were correct. That applied mainly to initials. Often people around here who have the Christian name James’ are called ‘Bill’ and one thinks that their initial should be ‘ W’ instead of ‘ J ‘.
– There have been some changes since you gave the answer.
-No. It is stated in the answer that those figures applied as at 5 April. If the honourable senator has any information that would tend to show that that information is not correct, I certainly would be pleased to have it and I am quite certain that the Department also would be pleased to have it.
Question resolved in the affirmative.
Senate adjourned at 11.6 p.m.
The following answers to questions were circulated:
asked the Minister for Social Security, upon notice:
– The answer to the honourable senator’s question is as follows:
The organisation did receive subsidy for several items purchased before 9 December 1974 for which it had submitted claims under the Sheltered Employment (Assistance) Act.
On 23 January 1975 a further subsidy claim was lodged for additional equipment which the organisation had purchased in 1 973 but which it had not previously claimed for or sought approval to purchase as required under the Sheltered Employment (Assistance) Act.
By that time this Act had been repealed by the Handicapped Persons (Assistance) Act.
The correct procedure for making claims under the Sheltered Employment (Assistance) Act, including the requirement for approval to be obtained before equipment was purchased, was fully explained to the organisation at a meeting between its representatives and Departmental officers on 26 March 1974. While the prior approval provision has been deleted from the Handicapped Persons (Assistance) Act, as the items included in the claims lodged on 23 January 1975 were purchased before the introduction of this Act, the organisation was advised that its claim could not be approved.
The organisation did not submit a claim until after 9 December 1974 (i.e. 23 January 1975), and their claim could not be considered eligible for consideration because the new Act only applied to equipment purchased after 9 December 1974, or equipment purchased prior to 9 December 1974 and for which approval had previously been given under the old Act, but a grant for which had not been paid prior to 9 December 1974.
It is noted that approval would only have been given under the old Act for items not yet purchased.
The fact that the organisation submitted claims for equipment subsidy on items purchased prior to approval, automatically disqualified the organisation from funding under the previous Act. That is, even if they had submitted a claim prior to 9 December 1974, it would not have attracted subsidy as the changed legislation did not make any difference to the organisation ‘s eligibility to claim.
asked the Minister representing the Minister for Health, upon notice:
– The Minister for Health has provided the following answer to the honourable senator’s question:
asked the Minister representing the Minister for Primary Industry, upon notice:
– The Minister for Primary Industry has supplied the following answer to the honourable senator’s question:
The assertion of blatant profiteering does not seem justified. The Industries Assistance Commission’s report on agricultural tractors indicated that profitability in the tractor manufacturing industry was marginal. The Commission stated:
When bounty is excluded, Chamberlain made losses on the production of tractors in each of the four years up to and including 1975. With the bounty payments taken into account, the Company made a moderate return on its funds employed in the first three years, but suffered a small loss in 1975. Harvester made losses on tractor production in 1972 and 1973 both before and after bounty and did slightly better than break-even in 1974 with bounty payments taken into account.’
asked the Minister representing the Minister for Transport, upon notice:
– The Minister for Transport has provided the following answer to the honourable senator’s question:
The grain handling authorities (including port terminal facilities) and the railways in the States where these problems are most acute come under the responsibility of the State Governments. However, the Bureau of Transport Economics has been asked to undertake a study with a view to reporting on wheat freight rates in Australia.
The Bureau of Transport Economics has been requested to consider the relationship of wheat freight rates and the cost of provision of necessary facilities for both rail and road transport, in addition to the effect of institutional factors on means and direction of transport and the efficiency of present transport arrangements for wheat.
asked the Minister for Science, upon notice:
-The answer to the honourable senator’s question is as follows:
CSIRO regards the fly as potentially a very great threat to the Australian fruit industry. However, there is a possibility that the strain present in Australia differs from the serious pest strains that are present in Hawaii and elsewhere. Until further evidence is obtained, Australia must continue to regard the presence of the fly as a most serious matter.
Through its representation on the specialist Working Party, the Federal Government is collaborating closely with the Queensland and Western Australian Government in an active program of survey and research for which $1,803,000 was allocated by the Federal Government in 1975-76. Further recommendations for action will be contained in the specialist Working Party ‘s report.
asked the Minister representing the Minister for Transport, upon notice:
– The Minister for Transport has provided the following answer to the honourable senator’s question:
Great Barrier Reef (Question No. SSI)
asked the Minister for Science, upon notice:
– In answer to the above questions:
asked the Minister representing the Minister for Primary Industry, upon notice:
– The Minister for Primary Industry has provided the following answer to the honourable senator’s question:
asked the Minister representing the Minister for Health, upon notice:
– The Minister for Health has provided the following answer to the honourable senator’s question:
asked the Minister representing the Minister for Immigration and Ethnic Affairs, upon notice:
What intake procedures would apply to an applicant in Northern Ireland seeking to emigrate to Australia who produced a Republic of Ireland passport.
– The Minister for Immigration and Ethnic Affairs has provided the following answer to the honourable senator’s question:
Any application to migrate to Australia from Northern Ireland lodged by the holder of a Republic of Ireland passport would be considered within the scope of normal migrant policy which is applied globally irrespective of the race or nationality of the applicant.
The policy provides for entry to be considered on the basis of family relationship criteria or of skills or qualifications specified as in positive demand in Australia.
Subject to eligibility for entry being established on these grounds, all applicants must then meet the migrant standards relating to health, character, personal qualities and intention of permanent settlement.
Student Assistance Review Tribunals
– On 4 May, Senator Primmer asked me the following question, without notice:
I ask the Minister for Education whether he has been able to reconsider his original decision to suspend country sittings of student assistance review tribunals? Has the Minister been able to give consideration to the request of the Australian Union of Students that it be permitted to represent country students who are disadvantaged at metropolitan sittings of student assistance review tribunals which are hearing appeals against tertiary education allowance scheme decisions?
I provided some information to the honourable senator and undertook to provide further information. I am now able to elaborate:
Under section 28 of the Student Assistance Act, Tribunals have the authority to permit students whose cases are being reviewed to be represented by other persons, provided such persons are not legal practitioners. In practice, Tribunals ave readily granted approval, and there should be no real difficulty in this measure being applied generally to country students. The AUS has been encouraged to consider the possibility of arranging for the representation of country students and the matter now rests with them.
Cambodian and Vietnamese Students: Tertiary Allowances
– On 4 May Senator Knight asked me the following question, without notice:
My question is directed to the Minister for Education. Are tertiary allowances under the tertiary education assistance scheme available to Cambodian and Vietnamese refugees now living in Australia as settlers? If so, can the Minister indicate the conditions under which these allowances are paid to such refugees? Is the Minister able to say whether some refugees from Vietnam and Cambodia have been unable to obtain such allowances because they cannot be means tested as it is impossible to trace or assess their parents’ means in their country of origin? What action can be taken if these people are refused assistance on such grounds? Have appeals been heard concerning people in such circumstances and can the Minister say whether some special consideration might be given to them in view of their situation as refugees?
I provided some information to the honourable senator and undertook to provide further information. I am now able to elaborate on my earlier answer.
The availability of assistance under the Tertiary Education Assistance Scheme is governed by the application of the means test as laid down in the Regulations to the Student Assistance Act.
Where students are married, aged 25 years, orphans or wards or have supported themselves for two years from sources such as employment earnings or Colombo Plan Scholarships, the means test is applied to their estimated income in the year of study. This practice is readily applicable to refugee students granted permanent resident status and already some 30 Cambodian and Vietnamese students are in receipt of allowances because they have satisfied one of these criteria.
Where students cannot meet one of these criteria, the Regulations require that the means test be applied to the income of the parents in the preceding financial year. Where refugee students are unable to provide details of parental means, my Department will endeavour to get some indication of the likely parental income from the Department of Foreign Affairs. A small number of applications from students in this category are being processed now.
It is probable that in some cases, no estimate of parental income will be available from the student or the Department of Foreign Affairs. In these instances it may be necessary for the student to interrupt his study or study pan time and take up employment in order to support himself for two years or until he meets one of the other criteria which would enable the means test to be applied to his personal income and not that of his parents.
I am sympathetic to the needs of the refugee students and will take all possible steps to assist them. However, it has been a long standing principle of schemes of assistance endorsed by several Ministers, that assistance should not be extended to overseas students on more favourable conditions than those applying to Australian students.
Education: Funds for non-Government Schools in Wannon Electorate (Question No. 458)
asked the Minister for Education, upon notice:
What amount of Federal Government funds were made available to non-Government schools in the electorate of Wannon in the financial years 1967-68, 1968-69, 1969-70, 1970-71, 1971-72, 1972-73, 1973-74, 1974-75 and 1975-76 to date.
– The answer to the honourable senator’s question is as follows:
Funds for non-Government schools in the electorate of Wannon are made available under programs administered by the Department of Education and the Schools Commission.
A Programs Administered by the Department of Education
Funds administered by the Department of Education were made available under the following acts:
States Grants (Science Laboratories) Act 1 97 1;
States Grants ( Independent Schools) Act 1 969- 1 972;
States Grants (Secondary Schools Libraries) Act 1971;
States Grants (Schools) Act 1972-73.
Payments made under these acts are set out in reports which were tabled in the Senate on the dates listed below.
States Grants (Science Laboratories) Act 1 97 1: 8 December 1971; 27 October 1972; 12 December 1973; 28 October 1975; 4 May 1976.
States Grants ( Independent Schools) Act 1 969- 1 972: 24 August 1971; 13 December 1972; 12 March 1974; 5 December 1974.
States Grants (Secondary Schools Libraries) Act 197 1: 6May 1971; 17 May 1972; 3 April 1973; 23 July 1974; 29 May 1975.
States Grants (Schools) Act 1972-73: 12 November 1974.
B Programs Administered by the Schools Commission
Funds administered by the Schools Commission are made available on a calandar year basis commencing in 1 974.
Payments for 1974 are set out in the document ‘Report: Financial assistance granted to each State in 1974 (under the) States Grants (Schools) Act 1973-74’ which was tabled in the Senate on 1 October 1975.
Funds for 1975 and 1976 (up to 28 April) are set out below.
Cite as: Australia, Senate, Debates, 26 May 1976, viewed 22 October 2017, <http://historichansard.net/senate/1976/19760526_senate_30_s68/>.