House of Representatives
2 October 1951

20th Parliament · 1st Session

  1. House of Representatives
  2. 20th Parliament
  3. 1951

Mr. SPEAKER (Hon. Archie Cameron) took the chair at 2.30 p.m., and read prayers.

page 170

QUESTION

PERSIA

Dr EVATT:
BARTON, NEW SOUTH WALES

– I ask the Prime Minis ter- whether he can give the House any information about the position in the dispute between the United Kingdom Government and the Government of Persia. I also ask him, without desiring in the slightest way to embarrass the British Government, which has adopted a .policy of ‘patience and firmness in this matter, whether he can tell us the position regarding any possible commitments of Australia in connexion with that dispute?

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– Tho right honorable gentleman has,.asked, in the latter portion of his question, whether we have some commitments in relation to the Persian dispute. The answer is that we have none. We have naturally consulted with His Majesty’s Government in the United Kingdom, but we ourselves have no commitments. The right honorable gentleman has also asked about the progress of these rather unhappy affairs, but there is nothing material that I can add to what is already known through the agency of the cables.

page 170

QUESTION

CORTISONE AND AC.TH

Mr FALKINDER:
FRANKLIN, TASMANIA

– Has the Minister for Health, as the result of his trip overseas, any new information about further developments relative to cortisone, ACTH, or any other drug, particularly for use in the treatment of arthritis? x Sir EARLE PAGE. - I spent several days with the men who are doing most of the research in those matters, especially Dr. P. Hench, of the Mayo Institute at Rochester in Minnesota, and also with the Armour organization, and Merck and Schering. The position at present is that although their researches have shown that cortisone is of very great value, they still have not been able to get rid of the side effects, which are rather damaging in certain cases. I found in addition that the production of those drugs was not yet sufficient to enable us to make them generally available to the people of Australia, but the makers have promised me to increase the quantities that they are making available to Australia for experimental purposes through the Royal Australasian College of Physicians. So, by the time the drugs have become available, we should know exactly what to dp with them.

page 171

QUESTION

COMMONWEALTH HOSTELS LIMITED

Mr W M BOURKE:
FAWKNER, VICTORIA

– I desire to address some questions to the Minister for Labour and National Service, and, by way of explanation, I point out that this Government recently registered a company called Commonwealth Hostels Limited, the object of which is to operate hostels in Australia for immigrants, government employees and members of the defence forces. I ask the Minister the following questions: - 1. What are the reasons behind the formation of that company, and is it a part of the Government’s plan to dismiss more public servants? 2. Will permanent public servants who are at present administering these hostels be compelled to transfer to the pay-roll of the new company? If they are compelled to do so, will the Minister give an assurance that their rights in respect of seniority, promotion, superannuation, leave and so on, will be fully protected ?

Mr HOLT:
Minister for Immigration · HIGGINS, VICTORIA · LP

– A full statement was made when the Government announced its decision, and thi3 made it clear that the intention of the Government was to effect some improvement of efficiency in the conduct of hostels. The action that has been taken follows closely along the line of action that was taken earlier by the governments of the United Kingdom and the United States of America in relation to the management of similar hostels in those countries. The sole objective of the Government is greater efficiency. It discovered that the business of conducting what became, in effect, a vast chain of boarding houses could not be carried on conveniently within the ordinary departmental structure. Most, if not all, of the employees of the new company will be those who are already engaged. A saving of staff is not anticipated. The new arrangement does not form a part of the general retrenchment programme that the Government has announced for other purposes.

Mr Ward:

– Who provides the capital ?

Mr HOLT:

– The capital is provided entirely by the Australian Government. It is not anticipated that profits will be made. The purpose is to cover actual working expenses and to return to hostel residents any savings that may be effected in the form of improved services or reduced tariffs. I assure the honorable member that employees will not be compulsorily transferred. They will have an option to exercise. Those who elect to transfer will retain their full rights in relation to employment within the Public Service as has been the practice when similar changes have been made in the past.

page 171

QUESTION

DAIRYING

Mr BERNARD CORSER:
WIDE BAY, QUEENSLAND

– Has the attention of the Minister representing the Minister who is acting for the Minister for Commerce and Agriculture been drawn to the claim that has been made by the president of the Queensland Shopkeepers Association that- Brisbane black-marketeer hawkers are selling butter at prices varying from 6s. to 7s. per lb. to victims who claim that they are forced to buy at those rates in order to provide a necessary food for their children ? As none of the excessive profit that is made from such transactions goes to the underpaid, drought-menaced dairymen of Queensland, can the Minister suggest any further method of mediation that may enable Queensland workers and butter producers to enjoy the benefits of the higher price for butter that has already been fixed in four States and in all Commonwealth territory?

Mr ANTHONY:
Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

– I have. noticed reports that butter is being black-marketed in Brisbane at 6s. and 7s. per lb. while butter of equal quality can be bought in Western Australia, South. Australia, Victoria and Tasmania for 3s. 1½d. per lb. The Government of Queensland has been adamant in refusing to permit the price increase that the Dairying Industry Cost of Production Advisory Committee recommended for payment to the dairyfarmer. I remind the House that this committee is the equivalent of an arbitration court for the dairy-farmers, who are being denied the right to obtain a fair price for their product in Queensland and New South Wales. We have suggested to the governments of those two States that, if they are not prepared to grant a higher price they should transfer their price-fixing powers in respect of butter to us so that we may take the responsibility of awarding the farmer a fair price. The governments of the four States that I have already mentioned have fixed a proper price, but Labour governments in New South Wales and Queensland are preventing farmers in those States from receiving a fair return for their butter.

Mr JAMES:
HUNTER, NEW SOUTH WALES

– Will the Prime Minister say whether the production of coal so far this year is already a record, and that if the present rate of production is maintained until the end of the year all previous records for a year’s production mav bc surpassed? Production could be adversely affected by the trouble in the coal-fields arising from the fact that, owing to the shortage of butter, miners have to use. margarine in “their cribs. Will the right honorable gentleman say whether there is any truth in the allegation that he said that if there were a further increase in the price of butter the Commonwealth would subsidize the increase, and that that is one of the reasons why the governments of New South Wales and Queensland will not increase the price of butter?

Mr SPEAKER:

– Order ! The honorable member is getting outside the scope of a question.

Mr MENZIES:
LP

– In reference to the first part of the honorable member’s question, I believe that it is true that the production of coal is the highest on record. In fact, the improvement in production during the last 21 months has been continuous and marked. I take leave to doubt whether the coal-miners who are engaged in this most important basic industry will allow their efforts to be controlled by whether .they have butter or. margarine. If there is a shortage of butter in New South Wales, it is a matter which the coal-miners might with advantage take up with the Premier of that State, because all that is needed is one simple decision by the Government of New South Wales, in line with the decision that has been made by four other States, for supplies of butter to flow as normally as they do in the four States which have recognized the increased costs of production. Concerning the last part of the honorable member’s question, this Government, like its predecessor in office, supports the principle of guaranteeing the cost of production of butter. That policy should not be treated by a rational community as an undertaking that whatever happens in the future the increased costs of producing butter must be borne by the Australian Government. That is a crazy idea and is no more entertained by this Government than it was by its predecessor which, as all honorable members will recollect, indicated not very long before it went out of office that it was not prepared to chase up the cost of butter production, but that it considered that State prices authorities had some responsibility in the matter. That responsibility has been recognized by the governments of four States of .the Commonwealth, and when it is recognized by the New South Wales Government the answer to the honorable member’s question will be complete.

Mr FAILES:
LAWSON, NEW SOUTH WALES

– As I understand that a considerable quantity of butter is being transported to Sydney by . air, is the

Minister for Civil Aviation able to state the quantity so transported, the places from which it is being consigned, and the cost of such transportation ?

Mr ANTHONY:

– A very large quantity of butter is being consigned to New South Wales from the other States of the Commonwealth, including those as far distant as Western Australia and Tasmania. 1 understand that the quantity of butter arriving in Sydney by air is approximately 2 tons a day and that the cost of .transportation varies according to the capital city from which it is sent. 1 believe that it costs approximately Sd. to send. 1 lb. of butter from Melbourne, lid. from Adelaide, 2s. from Perth and ls. from Hobart. That cost, of course, is added to the price of the butter. It is obvious that only those who are in the higher income brackets can afford to buy such butter. Although approximately 2 tons of butter a day are being sent by air to Sydney, the requirements of that city are approximtely 700 tons a day.

page 173

QUESTION

PRIMARY PRODUCTION

Mr PEARCE:
CAPRICORNIA, QUEENSLAND

– -Will the Minister representing the Minister acting for the Minister for Commerce and Agriculture inform the House whether it is true that the Queensland Government to-day introduced legislation that not only will have the .effect of refusing dairy-farmers the correct price for their butter, but which will abo require the primary producers’- boards to obey the Government’s edicts or be disbanded and replaced by boards of government appointees? Will the Minister examine the power of the Commonwealth to prevent this act of blatant dictatorship by the Queensland Government which is using its sovereign powers to bring primary production in that State to a stage of slavery to the government?

Mr ANTHONY:
CP

– I am not aware that the Queensland Government has taken the action mentioned by the honorable member, but I should not be surprised al any action that it might take against primary producers in that State. The butter producers of Queensland are now going through as bad a. period as they have ever experienced. They are contending with drought and bush-fires as well as other troubles. The whole of the area around Gympie, which is one of the-:–

Mr SPEAKER:

-Order ! The Minister is getting outside the question.

Mr ANTHONY:

– I cannot, at this moment, tell the House what powers the Australian Government possesses to prevent the Queensland Government from acting in the way that it intends- to act, but I shall have the facts examined and provide the honorable member with an answer to his question.

page 173

ELECTRIC POWER

Mi-. CREMEAN.- Will the Prime Minister lay on the table of the House the interim report of the Consultative Committee on Electrical Power, as compiled in August, 1951 ?

Mr MENZIES:
LP

– The committee makes its report to me and to each Premier concerned. I do not think that any useful purpose would be served by tabling an interim report which is merely of a preliminary nature. I shall give consideration to the honorable member’s proposal when the work of the committee has been concluded.

page 173

APPLES AND PEARS

Mir. BROWN. - I preface a. question to the Minister representing the Minister acting for the Minister for Commerce and Agriculture by pointing out that it has been reported by the chairman of the Australian Apple and Pear Board that the Government of the United States of America has made available to the Government of the United Kingdom 2,000,000 dollars for the purchase of American apples. In addition, the United States Government is reported to have guaranteed the American producers a subsidy of Ils. Cd. a case at the point of shipment on the American seaboard. Will the Minister make representations to the British Government to check the position of the Australian exporters to enable them to compete with the highly subsidised American fruit on the British market?

Mr ANTHONY:
CP

– I shall bring the honorable member’s suggestion to the notice of the Minister.

page 174

QUESTION

CIVIL AVIATION

Mr CURTIN:
WATSON, NEW SOUTH WALES

– Will the Minister for Civil Aviation tell the House how far neg . tiations have proceeded with the representatives of K.L.M. Royal Dutch Airlines in connexion with the sale of Trans- Australia Airlines? Is it a fact that it was agreed that no announcement should be made about the discussion in connexion with the projected sale until the next recess of the Parliament, which procedure was adopted in connexion with the sale by the Government of its shareholding in Amalgamated Wireless (Australasia) Limited?

Mr ANTHONY:
CP

– The honorable member’s suggestion is too absurd to merit a reply.

Mr MINOGUE:
WEST SYDNEY, NEW SOUTH WALES

– I ask the Minister for Social Services to give consideration to making free air travel available to Victoria Cross winners of World War I. and World War II. I previously asked a similar question of the Minister, but have not yet received an answer to it. There should be no need for me to stress the claims of such persons-

Mr SPEAKER:

– Order ! The honorable member must not argue his question.

Mr ANTHONY:

– An answer to the honorable member’s question will be found on to-day’s notice-paper.

Mr CURTIN:

– Oan the Minister for Air say whether it is a fact that the Meteor Mark VIII. jet planes supplied to 77 Squadron in Korea have been grounded because of their inferior performance compared with that of the Russian-built M.I.G. 15? Have grave doubts arisen in the minds of the Minister and of the leaders of the Air Force about the reliability of expert information in respect of these machines? Is history repeating itself in this matter? I point out that a similar situation confronted those responsible for our air defences when our Wirraway machines were shot out of the air in 1940.

Mr McMAHON:
Minister for Air · LOWE, NEW SOUTH WALES · LP

– In reply to the speech the honorable member has just made, he may remember that last week I gave an answer to the question that he has now raised. I then said that I had sent the Chief of the Air Staff and Group Captain McLaghlan to

Korea to investigate the matter. Those officers will return ‘to Australia to-morrow and will furnish a report to me. The honorable member’s statement that the Meteor Mark VIII. aircraft is inferior to the Russian M.I.G. 15 is entirely without foundation. The Meteor machines are the best that we can obtain ‘at present and under certain conditions they have proved themselves to be the best machines in operations in Korea. On level flying and in dives they are slightly slower than the Russian M.I.G. 15, but in other respects they are holding their own whilst we have received reports that in dogfights they are superior to the Russian machines.

page 174

QUESTION

IMMIGRATION

Mr TRELOAR:
GWYDIR, NEW SOUTH WALES

– I ask the Minister for Immigration to state the position in relation to the building of immigrant hostels in country centres, with particular reference to Gunnedah, where, I may say by way of explanation, the necessary steps have been taken to build a hostel. A very active local immigration committee has made arrangements with people in England to come out to Gunnedah. Has the Minister any information on this subject?

Mr HOLT:
LP

– I have previously stated in the House that as a result of the recasting by the Government of its immigration plans, it has been found necessary to defer some proposals that we had previously adopted for the construction of hostels for immigrants in various parts of Australia, particularly in certain country centres, including Gunnedah. This does not mean, however, that in that particular centre activities designed to introduce suitable immigrants from overseas should cease. I am hoping that the citizens of Gunnedah, who have been very active and public-spirited in this matter, will go ahead with their voluntary efforts to induce immigrants to take their place in that district. Schemes of financial assistance have been adopted by Australia and the United Kingdom, and I am certain that employers in the Gunnedah district would be able to take suitable immigrants who might be selected from overseas. My department will co-operate readily in any voluntary activity of that kind.

Mr WILSON:
STURT, SOUTH AUSTRALIA

– In view of the probability, owing to present population trends, that by 1960 we shall be producing insufficient food in Australia to meet our own requirements, will the Minister for Immigration say that henceforth in the choice of immigrants preference will be given to people who are willing to go on the land and stay there?

Mr HOLT:

– I can assure the honorable member that that matter is very much in the mind of the Government. It is our intention to secure from abroad as many suitable settlers for the land as we can, and our officers overseas have been given instructions to that effect.

Mr CURTIN:

– Can the Minister for Immigration inform the House what steps have been taken to execute the warrants that have been issued for the arrest of new Australians for crimes which include murder, rape and robbery with violence? Is it true that the number of warrants awaiting execution has reached the startling total of 1,800 ? What does the Minister intend to do about this matter?

Mr HOLT:

– I do not know where the honorable member gets his alleged information. I should be very glad if he would give me details of statements of this kind that he makes in the Parliament. If there is the undue amount of disorder, violence, and crime in New South Wales that he would have us believe there is it is about time that the Government of that State did something to police its laws effectively. In no other part of the Commonwealth are the difficulties to which the honorable member for Watson has referred being experienced. The responsibility for dealing with breaches of the peace or other offences against the law lies with the police forces of the States in which the lawlessness occurs. I have told the House repeatedly that, according to information which has reached the Australian Government from commissioners of police in the various States, there is no reason to believe that an undue proportion of offences is being committed by immigrants.

page 175

QUESTION

TAXATION

Mr BRUCE:
LEICHHARDT, QUEENSLAND

– Will the Treasurer inform the House whether the inquiry into the payment of income tax on tin ore production that was instituted by him has been completed? If so, does the Government propose to take any action in connexion with the matter ?

Sir ARTHUR FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

– The special committee that was established to investigate the incidence of taxation and other matters referred to it has not presented its report upon the question to which the honorable gentleman has referred.

Mr McLEOD:
WANNON, VICTORIA

– Will the Treasurer state from what groups of income taxpayers among primary producers, such as wool-growers, wheat-growers, and the like, he expects to obtain the £47,000,000 which he proposes to raise during th« present financial year by abolishing the averaging system in respect of the incomes of primary producers? Will the right honorable gentleman state the amounts expected to be raised in each fi. 001) income group, commencing with the group with incomes of between £4.000 and £5.000?

Sir ARTHUR FADDEN:

– The question asked by the honorable member is associated with the budget which is now before the House and the position will be explained in due course.

page 175

QUESTION

THE PARLIAMENT

Mr GRAYDEN:
SWAN, WESTERN AUSTRALIA

– In view of the intense national interest in the debate that we understand will take place shortly between the Leader of the Opposition and the Vice-Chancellor of the Australian National University, I ask you, Mr. Speaker, whether you will explore the possibility of permitting the debate to be held in this chamber on a non-sitting day, in order, first, that honorable members may have an opportunity to hear Professor Sir Douglas Copland, who is regarded as Australia’s foremost authority on economics, and secondly, that the people of Australia may be able to listen to the debate through the broadcasting system ?

Mr SPEAKER:

– The only exception that I am prepared to make in regard to the use of this chamber is to make it available for conferences of Commonwealth and State Ministers. Under no circumstances will I allo*w it to be used for any other purpose.

page 176

QUESTION

NATIONAL SERVICE

Mr CHAMBERS:
ADELAIDE, SOUTH AUSTRALIA

– Doubtless the Minister for the Army, to whom my question is addressed, is aware that members of the Citizen Military Forces and the Permanent Military Forces wear on their uniforms badges that indicate the units to which they belong. National service trainees are forced to wear a badge that indicates that they are national service trainees. I am certain that the Minister has received many complaints about that, because the trainees resent being forced to wear this badge. “Will the honorable gentleman say whether it will be possible for trainees to be permitted to wear on their uniforms the badges of the units to which they are allocated?

Mr FRANCIS:
Minister for the Army · MORETON, QUEENSLAND · LP

– I have spoken to many national service trainees in a number of camps throughout Australia. On no occasion have I heard one of them object to wearing a badge that indicates that he is a member of the national service organization. These men are very proud to be national service trainees and have every right to be because they have done an outstanding job. They have done a surprisingly good job. Those to whom I have spoken are very happy to wear the badge to which the honorable gentleman has referred. I have been informed that there was great resentment in one battalion when a full quota of the badges was not available. We had to make a great effort to get the full quota of badges in order to satisfy the trainees.

page 176

QUESTION

GUIDED WEAPONS TESTING RANGE

Mr DOWNER:
ANGAS, SOUTH AUSTRALIA

– Allegations have been made for some time that at the Woomera -guided missiles range in South Australia there is a reckless waste of cement, galvanized iron and other’ building materials that are in short supply elsewhere. Will the Minister for Supply investigate these allegations? Will he direct that firm supervision shall be exercised in order to ensure that materials on the range shall be looked after carefully and that general extravagance shall be curbed ?

Mr BEALE:
Minister for Supply · PARRAMATTA, NEW SOUTH WALES · LP

– I am unable to speak with authority about the use of materials at the Woomera range during the period of office of the Chifley Government, but I am able, to say that, according to the observations of my department and of myself, there is now no wastage of materials there. I do not pretend that, in a constructional undertaking upon which between £20,000,000 and £30,000,000 is being expended, it may not be possible to put one’s finger upon an odd case of waste, but the general picture is very different from that drawn by the honorable member. I am satisfied that Australia is getting good value for its money at Woomera. I shall cause further investigations to be made in order to satisfy the honorable member and his informants, and I shall inform him of the result in due course.

page 176

QUESTION

HEALTH AND MEDICAL SERVICES

Mr FITZGERALD:
PHILLIP, NEW SOUTH WALES

– Has the Minister for Health yet inaugurated the complete free medical and medicine service for all age, invalid and service pensioners that he promised to introduce some time ago ? If so, when did the full scheme commence to operate ? If the full scheme has not yet been inaugurated, will the right honorable gentleman state when it will begin ?

Sir EARLE PAGE:
Minister for Health · COWPER, NEW SOUTH WALES · CP

– I indicated, before the House rose at the end of the last sitting period, that the complete scheme was then in operation. I understand from the reports that I have received since my return from abroad that the scheme is operating perfectly satisfactorily.

page 176

QUESTION

CAPITAL ISSUES

Mr WIGHT:
LILLEY, QUEENSLAND

– Will the Treasurer say with whom rest3 the decision in regard to applications for consent to issue further capital? Does the Capital Issues Control Board make the decision or does it make ‘ a recommendation to the Treasurer?

Sir ARTHUR FADDEN:
CP

– The Capita] Issues Control Board was established for the specific purpose of dealing with applications for capital issues. It has a definite directive and has full authority. It makes the decisions and does not make any recommendations in connexion with them.

page 177

QUESTION

JAPAN

Mr HAYLEN:
PARKES, NEW SOUTH WALES

– Will the Prime Minister make a statement to the House at the earliest appropriate opportunity on the subject of Japanese trade with this country as a result of the Japanese Peace Treaty? Will he consider telling the House in that statement what restrictions we can impose to prevent the dumping of stored-up Japanese goods that are now available to the world market ? Will he also say what new protection we can give Australian secondary industry against the coolie labour standards of Japan? Will he also say what advantage the considerable dollar credits held by Japan will give our former enemy in the fight for goods in short supply which require dollars for their purchase ? Further, is he aware of the fact that there is a grave danger of Hong Kong being used as a port of entry for Japanese goods under illegal labels.

Mr MENZIES:
LP

– I shall find out whether a statement along the lines indicated by the honorable member can be prepared, although I do not know whether I shall make it myself or whether some other appropriate Minister will make it.

Mr SWARTZ:
DARLING DOWNS, QUEENSLAND

– When the Japanese peace treaty is ratified by the nations which are signatories to it the Japanese nation will then subscribe to the Charter of the United Nations. Is the Minister for External Affairs aware of a suggestion that Japan should accept some responsibility for the United Nation’s campaign in Korea? If the Security Council has considered such a proposal, does the Minister know whether it was discussed with the Government of South Korea?

Mr CASEY:
Minister for External Affairs · LP

– All that the Japanese Government has committed itself to is that, when the treaty has been ratified by all the signatory nations, Japan will seek to become a member of the United Nations, and will abide by the decisions of that organization. As the treaty is not likely to be ratified by a sufficient number of nations to bring it into effect until February or March of next year, it . will obviously be a considerable time before .Japan can become a member of the United Nations. Japan must first apply for membership, and must be sponsored by seven members of the council, and the application, to be successful, must not incur a veto by any of the five great powers. In the circumstances, the question of Japan’s participation in the Korean campaign has not arisen, nor has the matter been discussed with the Government of South Korea.

page 177

QUESTION

COMMONWEALTH JUBILEE CELEBRATIONS

Mr GALVIN:
KINGSTON, SOUTH AUSTRALIA

– Is the Prime Minister aware that employees of the Public Service, who as members of the ‘Commonwealth Military Force were selected to come to Canberra for the jubilee opening of Parliament, were granted leave without pay from’ their various departments, and received only their military rate of pay for the seven days that they spent in the capital ? Will the Prime Minister review this matter and ensure that Commonwealth employees receive the same treatment as was given to other members of the forces who attended the function, whose private employers make up the difference between the army rate of pay and the normal weekly pay of their employees?

Mr MENZIES:
LP

– I shall treat the honorable .member’s question as being on the notice-paper, ascertain what the facts are, and make an answer available to him in the House.

page 177

QUESTION

TIMBER,

Mr McCOLM:
BOWMAN, QUEENSLAND

– I direct to the Minister for Works and Housing a question relative to prefabricated houses, that arc either being purchased by the Commonwealth or the purchase of which is being subsidized by it. Can the Minister tell me whether it is true that before some timbers come to Australia they are treated to remove a large percentage of the resinous contents? If that is true, will the Minister see whether that practice can be prevented, because I believe that it is very necessary that some of the soft timbers that we are receiving from overseas should have their full resinous content if they are to last for any worth-while length of .time in this climate ?

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– I have no intimate knowledge of what happens to timber that is used in the construction of prefabricated houses before they are imported into this country. I know, however, that when I first visited the United Kingdom to inquire about prefabricated houses I received a serious warning that we were likely to encounter difficulties with timber from certain continental countries. Upon my return I passed the warning on to certain persons and governments, but it was not heeded. I do not think that any difficulty has been experienced with Baltic timber imported through the United Kingdom from United Kingdom firms, but I understand that there has been trouble with timber imported from other countries.

page 178

QUESTION

SOCIAL SERVICES

Mr PETERS:
BURKE, VICTORIA

– I understand that a pay-day for pensioners occurs, in Victoria at any rate, during the period between Christmas and New Year. Will the Minister for Social Services direct that the payment be made before Christmas ?

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– The Minister for Social Services has been delayed by a deputation, and he asked me to apologize for his absence. . I shall place the honorable member’s question before the Minister, who will reply in due course.

Mr GRIFFITHS:
SHORTLAND, NEW SOUTH WALES

– Can the Minister for Social Services inform me whether the Government has yet given consideration to the abolition of those anomalies in the social service regulations which prevent invalid children between the ages of sixteen and 21 years from receiving invalid pensions when it is deemed that their parents’ income is sufficient to keep them? Does the . Minister subscribe to the belief of the Government that the maintenance units of £3 a week for each member of a family whose age is in excess of sixteen years and 30s. a week for those under sixteen years is sufficient to keep them, in view of the fact that the cost of living is more than double what it was when the units were fixed? Moreover, does the Minister agree that an invalid person on whose behalf 10s. a week child endowment had been paid until he reached the age of sixteen years, irrespective of the parents’ income, should be left without means of support after he attains the age of sixteen years? If the Minister considers these matters to be anomalies, will he give’ the House an assurance that the position will be quickly rectified?

Mr TOWNLEY:
Minister for Social Services · DENISON, TASMANIA · LP

– The matters mentioned by the honorable member are dealt with in legislation now before the House. 1 suggest that the proper time to answer his question will be when that legislation is being debated. The adequate maintenance allowance has been increased to £4 for the husband and wife and £2 for each child under sixteen years of age. Provision has also been made for such children to enjoy the benefits of the rehabilitation scheme.

page 178

QUESTION

LEWIS BERGER AND SONS (AUSTRALIA) PROPRIETARY LIMITED

Mr WARD:

– Can the Minister for Supply say whether it is a fact that Lewis Berger and Sons (Australia) Proprietary Limited, paint manufacturers, are large suppliers to the Commonwealth? Is the Minister at present, or has he ever been, on the pay-roll of this firm, or has he received payment of any kind from the firm? If so, will he state the amount received, and the nature of the service performed by him in return?

Mr BEALE:
LP

– I do not know whether the firm mentioned by the honorable member supplies the Commonwealth. So far as I am aware, no contract that has ever’ come before me as Minister has contained the name of that firm. As for my professional relationship with the firm, it is a fact that, as a barrister, I have acted for it.

page 178

QUESTION

STOCKPILING

Mr MULCAHY:
LANG, NEW SOUTH WALES

– Can the Minister for supply state to the House the amount of money that has been allocated to stockpiling by the Government during the last twelve months? What is the amount of money spent for that purpose to date and what class of material has been purchased ?

Mr BEALE:
LP

– Speaking from memory, I think that Cabinet allocated about £30,000,000 for stockpiling during the last financial year. I cannot state the exact value of the goods that have been purchased, but I shall give consideration to the furnishing of that information. I do not think it would be advisable for me to state exactly what materials have been purchased for stockpiling, but I shall also examine that question in order to ascertain whether the information can be supplied.

page 179

QUESTION

SIR LESLIE BOYCE

Mr EGGINS:
LYNE, NEW SOUTH WALES

– I desire to ask the Prime Minister a question which arises from reports that reached Australia during the week-end that an Australian has been elected Lord Mayor of the City of London. As this is the first time in history that an Australian national has been appointed to this office and as Sir Leslie Boyce, the new Lord Mayor, was born in this country at Taree, which I have the honour to represent in this House, I ask the Prime Minister whether he will consider despatching a message of congratulation from this House to the newly appointed Lord Mayor on his assumption of this high office?

Mr MENZIES:
LP

– I am aware of the facts stated by the honorable member, with the exception of the fact that Sir Leslie Boyce was born in Taree. I have the pleasure of knowing Sir Leslie Boyce and have taken my own way of congratulating him on this very distinguished appointment. Everybody is delighted to think that, in the centre of the British Empire, an Australian is Lord Mayor.

page 179

QUESTION

TELEPHONE SERVICES

Mr BRYSON:
WILLS, VICTORIA

– I wish to ask the Postmaster-General whether it is a fact that over 30,000 applicants are awaiting the installation of telephone services in Victoria? Is it a fact that large quantities of telephone equipment are held in various stores in Melbourne? Is it also a fact that a number of linemen and technicians who would normally be employed on new installations are to be dismissed under the Government’s plan to dismiss 10,000 public servants? If this is a fact, when can applicants throughout Victoria expect to receive new telephone services ?

Mr ANTHONY:
CP

– I am not in a position to state exactly how many applications for telephone services are outstanding in Victoria. The number is very considerable, and would probably be about 30,000, as the honorable member has indicated. Considerable quantities of telephone equipment are stored but sufficient of everything that is required is not always available. The position of the Postal Department in relation to telephone apparatus is somewhat the same as that of a person who has sufficient materials for the building of a house except the roofing material. At any given time we may have plenty of telephones but we may be short of cable or of some other essential without which telephone connexions cannot be made.

Mr FULLER:
HUME, NEW SOUTH WALES

– In view of the facts that 90 applications for new telephones have been lodged in the Junee area; that the building of a model telephone exchange in that area has been commenced; and that there is a big demand for new telephones and for a modern exchange building in that area, will the Postmaster-General take immediate steps to have the dismissal notices issued to 80 members of the Junee technical and engineering staff of the Postal Department withdrawn in order to ensure better and more efficient service for thai, important district?

Mr ANTHONY:

– Dismissal notices that may have been served upon employees of my department in the Junee district are similar to those that have unfortunately had to be served ‘on postal employees in other parts of Australia, where Commonwealth public works have- had to be, for the time being, discontinued. The Prime Minister has mentioned previously the reasons for such suspension of works. I can accept no suggestion at the moment that these decisions should be altered.

page 179

QUESTION

PUBLIC SERVICE

Mr DUTHIE:
WILMOT, TASMANIA

– Is the Prime Minister aware that a paper issued to members of this House last week contains a. list of 134 Public Service appointments made during recent weeks to fourteen Commonwealth departments? How does that remarkable fact make sense in the light of the Government’s action in dismissing or proposing to dismiss 10,000 public servants ?

Mr MENZIES:
LP

– I am not aware of the nature of the appointments referred to, nor have I seen the paper mentioned by the honorable member. However, I can very well understand that, although retrenchment is being carried out, that does not mean that all recruitment to the Service must be suspended. To abandon all recruitment to the Public Service would be to do ultimately an immeasurable amount of harm. Consequently, there may be in special cases, or at the most junior levels, a continued intake into the Service. The problem that has concerned us has been the overall problem of reducing the overall number of persons in the Service.

page 180

QUESTION

COMMUNISM

Mr EDMONDS:
HERBERT, QUEENSLAND

– Will the PostmasterGeneral state whether it is a fact that at Murwillumbah, when referring to a number of clergymen who had indicated support for a “ No “ vote at the recent referendum, he said that it was unfortunate that the Australian, people were not aware that many of these clergymen had been associated with Communist organizations for years? If the honorable gentleman made such 11 statement, would he be prepared to mention the names of the clergy and the organizations to which he believes they belong in order that they in turn may have an opportunity to deny the accusation?

Mr ANTHONY:
CP

– Certain members of the clergy who broadcast or made statements during the referendum campaign advocating a “ No “ vote–

Mr Edmonds:

– They were not Communists.

Mr ANTHONY:

– I did not. say that they were Communists. I said that they had been associated with organizations that were Communist-controlled. If the honorable member wants me to mention a name, one of the gentlemen was Bishop Burgmann, who was patron-

Mr SPEAKER:

– Order ! The Minister is aware of the Standing Orders which relate to questions. I do not know whether he is in order in mentioning the name of a person in answering the question.

Mr ANTHONY:

– I am not saying that Bishop Burgmann is a Communist and I have never said so. What I’ am saying is that he was patron and vicepresident of an. organization, the AustraliaRussia Society, that was declared by the Australian Labour party itself to be a Communist organization. The Australian Labour party further declared that any member who belonged to that organization was liable to expulsion from the party.

Mr.- GALVIN. - Will the Minister for the Interior announce to the House at an early date the full extent of the Government’s defeat in the recent referendum by tabling the certificate of the Chief Electoral Officer covering the final figures?

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– I shall be delighted to give to the honorable member or to any other honorable member the final figures of the recent referendum when I receive them from the Chief Electoral Officer. I do not think that the honorable member will be very pleased with them.

page 180

QUESTION

BROADCASTING

Mr ANDREWS:
DAREBIN, VICTORIA

– I ask the PostmasterGeneral under what conditions the concession wireless listeners’ licencefee can be obtained ? Will the concession apply to a widower or widow pensioner as well as to pensioner husbands and wives who are residing together?

Mr ANTHONY:
CP

– I am unable to answer the question in precise terms because I do not understand what the honorable member is driving at. However, I shall supply him with an answer.

page 180

QUESTION

BROWSE ISLAND

Mr GRAYDEN:

– Can the Minister for the Navy say whether there have been any new developments in connexion with the reported landing of Indonesians on Browse Island off the north-west coast of Western Australia? Has the Government decided whether an aircraft or a naval vessel should be sent to investigate the reported landing?’

Mr McMAHON:
LP

– Browse Island is ;i tiny area about 400 yards long and- 200 yards wide. The Government does not consider that the Indonesian fishermen will stay on it for very long. For that reason I do not intend to send a recon.naisance aircraft or a naval vessel to the island in the near future. However, I assure the House that I shall keep the matter under constant supervision.

page 181

QUESTION

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

Mr WARD:

– Some time ago, an announcement was made through the press that a team of financial experts from the International Bank for Reconstruction and Development would visit Australia. Can the Prime Minister say whether those experts have yet arrived? Has the visit arisen from an invitation extended by the Australian Government? What is the purpose of the visit, and does the right honorable gentleman propose to table in the Parliament whatever report or recommendation the visitors may make to the Government?

Mr MENZIES:
LP

– The representatives of the International Bank for’ Reconstruction and Development have not arrived in Australia. If and when they do come, they will come as representatives of the bank. Whatever investigations they may make will be made on behalf of the bank, and whatever report they may make will be made to the bank.

page 181

QUESTION

OFFICE ACCOMMODATION

Mr BRYSON:

– I ask the Minister for Works and Housing whether his department is preparing a suite of offices for his occupancy at Manchester Building, 339 Swanston-street, Melbourne? If the department is not doing the work, has it been let to a private contractor? If the Minister himself will not occupy the offices who will do so? What is the estimated cost of the work? Has the estimate been exceeded ?

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– I have not given any instruction that I desire to occupy a new suite of offices. As a matter of fact, in order to avoid overcrowding and not to reduce space now used by the public, I am still occupying the same room that I occupied as a private member at the Federal Members’ Rooms in Melbourne. I have had made available one extra room for the use of my private secretary and a typist.

page 181

REPATRIATION BILL 1951

Bill received from the Senate, and (on motion by Mr. FRANCIS) read a first time.

page 181

PUBLIC SERVICE

Mr MENZIES:
Prime Minister · Kooyong · LP

– by leave - On the 19th July, after a series of Cabinet meetings, I announced several decisions on economic policy. Among these was one to effect an over-all reduction in the size of the Commonwealth Public Service. The terms of my announcement were as follows : -

We have decided to instruct the Public Service Board to prepare with all speed for the Cabinet a report recommending how u substantial reduction can be made in the number of Commonwealth employees - Commonwealth employees who arc not themselves engaged in some important productive activity.

There are two ways in which that may be done. We are directing that both of them be examined. One is to impose upon departments some percentage out in the total number of their employees. The other, which perhaps would be even more fruitful, is to make a complete examination of all functions which have been added to government departments in recent years, with a view to determining whether any of them can bc abandoned without an adverse effect on the community.

The target at which we aim in this matter., and which we are setting out in our instruction to the Public Service Board, is 10,000. At the moment there are about 15(3,000 people in the Commonwealth Service. We aim to release 10,000 of them for other employment.

The justification for that decision was overwhelming. In 1939 the total number of persons employed under the Commonwealth Public Service Act was 47,043. It was inevitable, with war-time organizations and controls, that this number should grow very considerably. It did. But the growth has continued since the war at an astonishing rate. The figures for the last five years are extremely significant -

This large growth, during a period in which the Australian demand for manpower has far exceeded the supply, and in which, therefore, vital industries have been gravely short of labour, clearly needed and still needs close examination. The whole economic policy which must be pursued at a time like this is designed to restore the nation’s economic balance; to increase basic production by extending basic employment; to concentrate materials and plant and man-power, by whatever means are available, on those industries which are essential to national security and progress and stability. This means diversion of men and resources from the less essential to the more essential industries, not under direct manpower controls, but as a consequence of measures of an economic and financial kind. The public would inevitably regard it as somewhat farcial for a government to set about re-adjusting the balance of employment of private citizens whilst allowing its own employment to grow without let or hindrance.

In this matter, involving the occupations of so many people, the Government did not act hastily. In the policy speech of 1949, we had undertaken to review the growing volume of Public Service employment. After we assumed office, we established a committee .consisting of the Chairman of the Public Service Board, Mr. Dunk. Mr. G. T. Chippindall, Mr. G. P. N. Watt, and Mr. A. A. Fitzgerald, to review the function and structure of the various departments. That committee made careful investigations, and as a result of discussions between it and a Cabinet committee, various changes were made and some staff economies were effected. A little later, with the cooperation of the Premiers of the various States, a conference of Public Service Commissioners was convened to discuss the extent to which the Commonwealth and State Public Services overlapped.

Against the background so obtained, I then had a series of discussions with the Chairman of the Public Service Board, on overlapping, on the re-examination of special functions taken on by departments in recent years, and on over-all staffing. These discussions led up to the Cabinet decision to which I referred at the beginning of this statement. The operative form of that decision was that we asked the Public Service Board to report _ on ways and means of effecting a reduction of roughly 5 per cent., or 10,000, over the whole field of Common.wealth employment. ‘

The board made an elaborate report Go Cabinet in which it dealt with the problem. Departments were examined one by one. A Cabinet committee considered this report and made recommendations to the full Cabinet, which then directed the board to proceed. Cabinet left it to the board to arrange with each departmental head the most practical means of effecting the desired reduction. Cabinet indicated that it would like the board and departments to complete consideration of their plans so that any difficulties encountered could be referred to Cabinet by the end of September. The board, working in close co-operation with the departments, proceeded to achieve the reduction, and the number of difficulties encountered ro doing so has, in fact, been quite small.

In making this reduction the Government and the board were both aware that there was being put in hand a substantial reduction in the capital expenditure programmes of some departments. They knew that certain 3tafF adjustments would naturally follow this reduction. The remainder of the reduction of staff, once surplus functions were eliminated, was to be achieved by the overhaul of departmental processes. It would have been anomalous to impose a reduction upon the Public Service departments and left untouched the statutory bodies who, in the aggregate, employ 40,000 people, or one-fifth of the total number employed by the Commonweal tb. I have, therefore, asked each Minister to examine ways and means of effecting reductions in relation to statutory bodies under his control.

It has always been open to us to reexamine the position in relation to any sector of Commonwealth employment where the reduction asked for by the Government cannot be achieved without undue difficulty. The over-riding con- sideration before the board and the heads of departments has been that staff reductions should bo achieved in such a way as to cause the minimum dislocation of the services which are rendered to the community. Already, some sharp criticism has been directed to the reductions in the Postal Department.

No one regrets more than the Govern- ment does the necessity to reduce the overall staff of this important department, the work of which is so vital to the business and domestic lives of our people. But, after weighing all the financial facts, including the works programmes of the States and the highly inflationary effect of an excessive programme of capital works and capital investment, the Government has reluctantly been obliged to reduce substantially the funds allocated for capital works in the Postal Department, and this has an automatic effect on employment. Indeed, I am informed that the greater part of the reduction will result from the cut in capital expenditure and not from arbitrary staff reduction.

In giving effect to the Government’s decision, my colleague, the PostmasterGeneral (Mr.Anthony), has taken special steps to ensure that the least possible inconvenience is caused to the public and that the staff employed is closely related to the work load. The attention of the controlling officers will continue to be directed towards securing the greatest economy and efficiency. Apart altogether from Postal Department works, honorable members are aware of the heavy cut made in the States’ works programmes at the last meeting of the Loan Council. The Commonwealth has imposed a substantial cut upon its own works programme which, in money figures, will not be substantially greater than last year, and will, therefore, in terms of actual work done, be smaller. This will lead to a fall in the number of persons employed on government works of a capital nature, the main departments concerned apart from the Postmaster-General’s Department, being the Department of Works and Housing, the Department of Civil Aviation, and to some extent the Department of Immigration. The main force of the reductions, that are dealt with in the statement will be borne by persons who are temporarily employed in the Public Service. Investigation has shown that, subject to certain particular circumstances that are covered by the Public Service Act, fewer than 100 permanent officers will be affected by this decision. They will be dealt with, of course, under section 20 of the Public Ser vice Act. All of the others are temporary employees. The Public Service Act itself clearly recognizes the temporary nature of their employment.

The order in which the Public Service Board retrenches temporary employees has been very carefully worked out and has been embodied in the General Orders of the Public Service Board since long before this decision arose. It is a longestablished rule. The order of retrenchment is as follows: -

Married women.

Women over the compulsory retiring age (65).

Males over the compulsory retiring age (65).

Single women and widows.

Persons qualified forpermanent appointment, but not so appointed.

Relatives of deceased soldiers.

Female ex-members of the forces.

Single men.

Married men without family.

Married men with family.

Male ex-members of the forces.

Honorable members will notice that there must be some over-lapping classifications. In effecting the reduction, the hoard and departments have naturally taken full advantage of normal staff wastage and have also, of course, taken full account of individual efficiency.

The Public Service Board is accepting registration for temporary employment from those persons who have been retrenched and will do what it- can to find them fresh employment as and when vacancies occur through normal staff turnover. The employees of the Australian Government are not concentrated in one place; they are scattered over Australia. Temporary hardship upon any individual employee - a hardship which we profoundly regret, but which is inseparable from all economic readjustment - is lessened at the present time by the large number of opportunities for alternative employment which exist. As the Minister for Labour and National Service (Mr. Holt) pointed out in this House last week, his department alone has particulars of 125,000 employment vacancies, a figure which by no means covers the total number of jobs available. I have here a list of departments which shows the number of employees in each on the 31st May, 1951, and the directed reduction in each case. The largest employing department, is of course, the

Postal Department, and the directed reduction in that field is 4,000. With the consent of honorable members I shall incorporate the list in Hansard. It is as follows: -

Honorable members will notice that the list does not include the defence departments - the Department of Defence, the Department of the Army, the Department of the Navy, the Department of Air, the Department of Supply and the Department of Defence Production. In a period of preparations in the defence field, it is inevitable that there must be an upward trend of employment in at least some of those departments, particularly those that arc concerned with production. The Organization and Methods Division of the Public Service Board is reviewing procedures in those departments in order to ensure that present and future employment shall he kept to a minimum. However, honorable members will appreciate that, as defence production progresses in government factories, with more and more orders being placed, there will, be some increase of industrial employment. That is inevitable, but it will be productive employment.

There is one other point that I should like to stress. Although the Government wishes to keep Public Service employment at a reasonable level - and I am sure that in this respect its wishes are those of every person in the community - obviously the Public Service cannot be pegged to some number that can never increase. With the rapidly expanding population, increased defence activity, the day to day changes in the services that the Government and the community require, the Public Service must continually adjust itself to the task that it has to perform Every endeavour will be made by the controlling authorities, namely, the Public Service Board and the heads of departments, to keep employment down to the adjusted levels. But Public Service management must have the same opportunities and the same responsibilities in adjusting staff to fluctuating work load as prevail in. other enterprises.

I want to make it perfectly clear that the Government’s decision is not a reflection upon the Public Service generally or upon the efficiency of the Public Service Board and the permanent heads of the various departments. Every Minister has many occasions to be grateful for the way in which he is served by his departments. I add my tribute to the Public Service, which is a conscientious and hardworking body with high traditions and which contains many men and women of marked ability. As 1 have said, the Government’s decision is inevitable at a time when our resources’ of materials, manpower and finance are not sufficient to do all that we want to do and when great efforts have to be made to restore economic balance and to answer the compelling calls of defence. By its decision and action the Government has adjusted its staff to the level necessitated by the circumstances and in accordance”, with the principle that, at a time of extremely great shortages, our resources should be concentrated as much as possible upon .the performance of our most pressing tasks. I lay on the table the following paper : -

Public Service Retrenchments - Ministerial Statement. and move -

That the paper be printed.

Mr PETERS:
Burke

.- In his policy speech to the nation during the general election campaign of 1949, the then Leader of the Opposition, who is the present Prime Minister (Mr. Menzies), said -

We recognize there must be an adequate force of government servants. While, therefore, we will check the present unhealthy expansion, we ure not contemplating, as some of our opponents appear to suggest, wholesale dismissals. What we propose to do is to reorganize departments.

On .the 16th March, 1950, as Prime Minister, the right honorable gentleman said -

The number of persons employed in the Commonwealth Service on thu 31st December, 1940, was 151,000.

I am following his example by omitting the odd hundreds. He continued -

Thu Public Service will ‘be kept to’ the minimum consistent with the adequate and efficient discharge of the tasks of government. This may involve an increase in such departments as the Postmaster-General’s, Social Services, Civil Aviation and Immigration where demands for services arc increasing.

On the 10th May, 1950, the right honorable gentleman said -

The number of persons employed in the Commonwealth Service on the 31st December, 1949, was 154)000 and on the 31st March, 1950, was 157,000.

He explained that the number that he had mentioned on the 16th March as having been employed on the 31st December, 1949, had been understated and had not included a group of Kew Australian employees. He again said that the work was increasing in certain departments and that adequate service must be given to the public. On the 6th July, 1950, the right honorable gentleman stated -

The number of Commonwealth employees as at 31st December, 1949, was 196,798 and at the 19th April, 1950, was 201,011.

He tersely remarked that the figures previously supplied for December, 1949, had been revised. He did not give any reason why more than 4,000 persons were engaged between the 31st March and the 19th April. The Prime Minister stated recently, in answer to a question asked by the honorable member for Grayndler (Mr. (Daly) that the number of employees in the Commonwealth Public Service in May, 1951, was 208,000. We now get a statement from him to the effect that on the 30th June, 1951, there were 163,000 Commonwealth employees. The figure as at the 31st December, 1949, that he previously supplied does not tally in any way with figures that he has presented to this House.

Mr Bland:

– What about the statutorycorporations?

Mr PETERS:

– If such bodies as the Snowy Mountains hydro-electric project are involved, are there to be dismissals of public servants other than those employed under the Public Service Act? Whatever supporters of the Government may say, we have been given a series of figures that do not tally with other figures that have been presented during the past few years. Of course, the Prime Minister may be a worthy disciple of the right honorable member for Bradfield (Mr. Hughes), who once made the amazing observation, “What does it matter what we said yesterday? “ I shall assume that the latest figures supplied by the Prime Minister are correct, that is, that there were 208,000 Commonwealth employees in May this year, and that, despite dismissals, resignations, deaths, and employees who have voluntarily left the Commonwealth service, there has since been an addition of 12,000 employees. In other words, every one who has left the Service for any reason since May has been replaced, and in addition 12,000 employees have been appointed. The Prime Minister has stated that the Public Service has been kept to the minimum, consistent with the adequate and efficient discharge of the tasks of government. The Government has been reminded continually in this House that on the hustings, prior to December, 1949, supporters of the Government had asserted that if returned to office the Government would check what they described as tho> unhealthy expansion of the Public Service, and that it would reorganize departments and use its employees to the best advantage. Actually this Government has increased the number of Commonwealth employees by 12,000 since coming to office. Now it has decided to dismiss 10,000 public servants. Could anything be more absurd? If it was the object of the Government to get rid of certain functions of government that it regarded as surplus, and to curtail the activities of every government department, that could have been accomplished by a policy of non-recruitment, and by the non-replacement of employees who resigned, retired or died. It could have been accomplished by the elimination of overtime in the various departments, including the Postmaster-General’s

Department. In 1950 the Prime Minister stated that the demand for postal services was increasing. He also stated that increasing demands were being made on the Taxation Branch and on the Department of Air, and that in practically every Commonwealth department an immense amount of overtime was being worked. If the Government had pursued the obvious course of keeping the Public Service to a minimum there would have been no necessity to dispense with the services of 10,000 public servants. It is obvious that there will be an increase of overtime worked as a result of the dismissals. I point out that the working of excessive overtime is a most ineffective and inefficient method of carrying on any service, whether governmental or private. However,’ the Government is not greatly concerned with the promotion of efficiency or with what will become of the public servants that it is throwing on to the scrap-heap. Many of the employees now being dismissed have had up to sixteen years’ service with the Commonwealth and would soon have become entitled to long-service leave. I contend that in sacking 10,000 ‘ public servants, after employing an additional 12,000 persons during the preceding eighteen months, the Government is merely making a gesture to the community that it is dealing with the problem of inflation. Indeed, the mouthpieces of the Government have announced that the object of the dismissals is to dampen down inflation ,in this country and to reduce governmental expenditure.

Mr Eggins:

– Is that not necessary?

Mr PETERS:

– Perhaps it is necessary, but if it is, this is not the proper way to accomplish it. Let us consider what will be the effect upon inflation of the dismissal of 10,000 public servants. According to Professor Cairns, the gross national expenditure in 194S-49 was £2,267,000,000 and the gross value of national real production was £1,526,000,000. There was an inflationary gap of £741.000,000. That was the position when Labour relinquished the treasury bench. In 1950-51 the gross national expenditure was £3,250,000,000 and the value of gross national real production was £1,700,000,000. The inflationary gap was £1,550,000,000. In other words, theinflationary gap had increased by over- £800,000,000 during this Government’s period in office.

Mr SPEAKER:

– Order! The honorable member is getting beyond the scope of the motion.

Mr PETERS:

– The point I make isthat inflation was galloping, and therefore the Government decided to dismiss 10,000 public servants. In order to affect inflation, beneficially their dismissal would have to reduce the overall expenditure or add to the national wealth, or both. If they are dismissed and reemployed in other governmental activities, or if they are dismissed and subsequently employed in luxury production,, national expenditure will not be decreased. I shall now quote again from the right honorable member’s policy speech of 1949. I like quoting the PrimeMinister. He said -

Let us make it clear that wc also, knowing the vital importance of full employment, -will use public works to the full. But unless therearc powers of direction of labour, how can a manual job at a country water works, though suited to many men, be the answer to the loss, of a job by a clerk or. a shop assistant at. Balmain ?

The majority of the 10,000 public servants who are to be dismissed will not”be able to secure employment’ in productive enterprises. The effect of the dismissals will not be to reduce the overall expenditure by the community, or toincrease the national wealth in the form of consumable goods, or to check inflation..

The Government had to do something. Honorable gentlemen will recall that theGovernment parties promised to deal with inflation. Early in the career of this; Government, a famous Cabinet meeting was held at which the question of the revaluation of the £1 was discussed and’ at which it was decided by twelve votesto seven that that was the method by which inflation should, be attacked. But subsequently pressure was brought to bear upon the Government, and the proposal’ was abandoned.

Mr SPEAKER:

-Order! The honorable gentleman is getting outside thescope of the paper.

Mr PETERS:

– I am endeavouring to prove that every argument that has- been advanced in favour of the sacking of 10,000 public servants is a spurious argument. 1 assume that the Government will not claim that it is dismissing these public servants in order to improve the efficiency of the Public Service. It cannot improve the efficiency of -that Service by that means.

Mr Eggins:

– What’ about other avenues of employment?

Mr SPEAKER:

– Order ! The House must come to order. Private debates across the chamber are completely inconsistent with the dignity of the House. The honorable member for Burke and nobody else has the floor.

Mr PETERS:

– I was a member of a deputation of members of the Clerks Union that waited upon the Minister for Labour and National Service (Mr. Holt).. We protested to the honorable gentleman against these indiscriminate dismissals. He told us that the public servants whose services were to be dispensed with would encounter no difficulty in obtaining employment elsewhere. He said that 2,000 of them could immediately secure employment with the Victorian Government and that others could secure employment with government instrumentalities in other States. Since then, the Victorian Government has commenced a sacking campaign upon a grand scale.

Mr Gullett:

– How many has it sacked ?

Mr SPEAKER:

– Order ! The honorable member for Burke has the call.

Mr PETERS:

– The State Electricity Commission in Victoria has dismissed some of its employees, and they are now seeking accommodation in Melbourne. Men will be dismissed from the Cairn Curren reservoir project, from the Nambrook Dennison project in the electorate of the honorable member for Gippsland (Mr. Bowden) and from the Kiewa electrical project. It is probable that the only big undertaking that will be continued in Victoria, will be Eildon dam project, work upon which is being undertaken by an American constructional company. The contra ctural obligations that the Victorian Government has to that company may render it desirable for the work to be proceeded with, The public servants who are to be dismissed will not, as the Minister for Labour and National Service said they would, be able to secure employment in the State services. They will be unable to find employment in housing or water projects of the kind that were suggested by the Prime Minister as being proper projects for promoting the welfare of the community.

I believe that the policy that is now being adopted by the Government will inspire private enterprise to follow in the Government’s footsteps. Private firms will begin to dismiss their employees. Banks are already restricting credit. Competition from overseas firms is causing some private companies in this country to reduce their output. This action by the Government is liable to destroy the foundations of prosperity, which .are confidence by the people in the future of the country and a system of full employment. The Government is destroying full employment and, by its pronouncements and attitude, is also destroying confidence. As a result of the Government’s actions, the outlook for this country has worsened considerably during the last three months. I regret that the Government has acted rather recklessly in the manner in which it has supplied figures to this House.

Mr SPEAKER:

– Order ! The honorable gentleman’s time has expired.

Mr BLAND:
Warringah

.- It is to be regretted that the honorable member for Burke (Mr. Peters) did not give us a more accurate picture of the problem that has been created by the Government’s decision to dismiss 5 per cent, of its employees in the Commonwealth Public Service. Having regard to the honorable gentleman’s experience, I had hoped that he would relate that action to the general policy of the Government. If he wants to promote employment irrespective of the conditions under which that employment is to be carried out, and if he also wishes value to be put back into the £1 in order to ensure that there shall be some opportunity for’ the people to benefit from prosperity, it would be interesting to listen to him relate those two matters. The honorable gentleman cannot have it both ways. He cannot have employment, irrespective, of the results of that employment, and also have value put hack into the £1 by increased production.

The Government is saying that it must accept its share of the general sacrifice that it is asking the whole community to make because it wishes to divert employment from industries of one type to industries that are of assistance to the defence effort. The problem is one of maintaining employment in relation to defence production. If there is to be any diversion of employment to defence production, this is one of the ways in which it must be effected.

The honorable member for Burke laid considerable stress upon the efficiency of the Public Service. I yield to no one in my admiration of the efficiency of the Public Service, but the immediate problem with which we are confronted relates, not to efficiency but to the priority that is te be given to various services. The Government has to decide whether services that are being rendered at the present time can bc justifiably continued in the light of the conditions with which we are faced. It is a matter, not of efficiency but of ascertaining how many services we can afford to operate in given circumstances. In order to achieve certain results, some services may have to be curtailed. That is the whole purpose of the budget and of the Government’s decision to reduce the size of the Public Service, which is a part of the general deflationary policy. I have no complaint whatever to make about the efficiency of the Public Service. The service is extraordinarily efficient, both in its methods and the way in which it is recruited ; but there are several things which some of us, at any rate, wish to see done in connexion with the problem that we are now discussing. The Prime Minister (Mr. Menzies) mentioned various methods by which the Public Service can be reduced, and he laid particular stress upon two methods. The right honorable gentleman stated that reduction of the Commonwealth Public Service could be effected by reducing the functions -of the Australian Government and by restoring to the States some of the services which have become attached to the Commonwealth during the last ten years. That would have been my method of dealing with the matter. I should not have worried about the Postal Department or the other departments with which the honorable member for Burke is concerned. Instead, I should have dealt with new Commonwealth departments, such as those which deal with education and housing, and returned their control to the various State governments. That would not necessarily have meant any major reduction of the total number of public servants, but it would have reduced the number of Commonwealth public servants. By such means efficiency would be increased because the number of public servants employed would be in conformity with the number of functions that must be performed by the Public Service. I should have adopted that method rather than that of taking an arbitrary figure of 5 per cent, or whatever figure the Government has adopted to reduce the number of public servants.

I am aware of another method that was tried in other days; I happened to’ be in the Public Service at the time. It was tried in the Commonwealth Public Service after World War I., when the right honorable member for Bradfield (Mr. Hughes) was Prime Minister, and it consisted of refusing to add to the numbers of public servants by the ordinary methods of recruitment. That is one method that could be adopted, but it cannot always be applied wisely. One may stop recruiting to fill vacancies caused by officers retiring, dying, or taking more lucrative employment outside the Public Service. But the Public Service must go on, and so it must be fed by people from below if we desire to avoid destroying the legitimate aspirations of youngsters who make the Service a career. Under that system appointments from outside are not made to fill the higher positions,, recruitment being simply from below, and in that way the stream is kept flowing.

Honorable members opposite cannot have it both ways. They cannot say.. that this matter affects efficiency and at the same time refuse to accept the whole of the policy laid down in the budget. One honorable member opposite has stated that

Hig action of the Government will be an invitation to private enterprise to follow the Government’s example. If private, employers transferred those persons engaged in non-essential industries to essential industries the very purpose sought by the Government in reducing the Public Service would be achieved. If the nonessential industries, which employ three times more labour to-day than they did in 1939. took such action, the whole purpose of the budget proposals would be achieved.

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

– “What does the honorable member mean by “essential industries “ ?

Mr BLAND:
WARRINGAH, NEW SOUTH WALES · LP

– Those which are necessary to minister to our basic needs and to produce those services which are essential for us to live. For instance, we could do without education, but no one would contend that that is one of the services’ that should be discarded in a civilized community. Given certain circumstances, there are services in one’s own household as in a community economy, about which it is necessary to decide whether to ha ve them or do without them. In the circumstances existing to-day we arc attempting to employ resources to meet conditions far beyond our ability to meet and we must make up our minds which services are to continue and which should be done away with.

There are two problems which must be considered to-day. The first is whether we can give an example to the rest of ‘the community by economizing in our capital expenditure so that the labour which would have been employed upon, capital works and services can be diverted l.o other activities. That is the problem that is immediately in front of us. The other is how are we to maintain the efficiency of the Public Service. I believe that this community would he very glad if the Prime Minister would io* a step further than he went in 1.950, when he came into office, and instead of appointing a departmental committee with only one outside member, Mr. A. A. Fitzgerald, he were to appoint a committee to investigate the whole organization of the Commonwealth Public Service in order to see whether it is entirely satisfactory for the tasks that it is required to perform. Honorable members will remember that there has been no inquiry into the organization of the Commonwealth Public Service since J.91S. The investigations which took place at that time resulted in a complete overhaul of the Service, and the establish ment of the present system. In the period that has elapsed since then major changes have taken place, the most important being in the size of the Service; it has grown from a few thousand officers at that time to 208,000 to-day. 1 remind the honorable member for Burke that that 208,000 includes staffs not merely under the control of the Commonwealth Public Service Board but abo those under the control of the statutory corporations. Eight thousand officers are to be dismissed from the Public Service as such, and the remainder are to come from the statutory corporations. There should bo no misunderstanding concerning the figures which the Prime Minister has presented.

The .management of a service of 10,000 officers requires one organization; that of a service of 200,000 requires a completely different organization. When those 200,000 officers are distributed, as the Prime Minister has stated, among al! the capital cities and many country towns in the various States, a. ma jor problem of organization is involved. That problem has not been examined at all. Any one concerned with a business undertaking knows that once it grows beyond a certain size it becomes essential to examine methods of organization just as much as methods of production. If honorable members remember what has happened in the United States of America, Canada and the United Kingdom, they will appreciate that over the years there have been repeated investigations of the public services of those countries and that on every occasion extraordinarily successful results have followed; greater efficiency has been obtained, without the necessity to add to the number of public servantsemployed.

Mr Rosevear:

– Distant, fields are always greener !

Mr BLAND:

– I daresay they are, but it is worthwhile, entering them occasionally to see whether or not we can ‘ learn something. I have no doubt that most of the background of the honorable member for Dalley (Mr, Rosevear) has been gained by looking beyond bis own backyard. I should like the Government to make such an investigation because I do not believe that power to do so can be generated inside the organization itself. £ know something of the organization of the Commonwealth. Public Service because recently I have been a member of a State public service, and I believe that it is necessary for us to examine the Service in the light of changed conditions. It is my opinion that that would be the one really profitable move that the Government could make and that it would ensure the maintenance of efficiency, whereas reducing the number of public servants employed may strike at the efficiency of the Service. On the other hand it might divert people from some occupations to others in which they could be more profitably employed, and so fulfil the purpose that the Government has in mind. The Government’s proposals, whether in relation to the budget, to credit control or to reduction or diversion of employment, are all part of the one plan to secure not merely deflation but also the volume of goods that we want for both civilian and defence needs.

Mr WARD:
East Sydney

.- Both the Prime Minister (Mr. Menzies) and the honorable member for Warringah (Mr. Bland) have cleverly evaded the real issue and, if I may say so, have distorted the facts. I can easily imagine why the Government has blundered so much of late, if it has been dependent upon the advice of experts, or alleged experts like the honorable member for Warringah. Briefly, the honorable member for Warringah says that the Opposition cannot have it both ways. That is, if we want value put back into the £1 we have to sack 10,000 public servants. According to him, the dismissed persons are to go not into productive industry - into industries producing consumable goods that are in short supply and are selling at high prices - but into defence projects, which are completely nonproductive. Anybody who knows anything at all about this subject must recognize that having an excess of labour employed in defence projects is just as inflationary as having an over-expanded public service. No member of the Opposition has ever argued that the number of public servants should be kept at a particular figure regardless of the volume of work that the Public Service has to perform. In order to try to appease some of its supporters the Government has panicked, has made a blind stab and has said that 10,000 public servants have to go regardless of what effect the dismissals will have on the efficiency of the Service, or of how these people will be employed in the future. How would the honorable member for Warringah justify the dismissal of 10,000 public servants, when some of those who received notices of dismissal were working overtime right up to the .time that their employment ended? It is a well-recognized fact that overtime work in the Public Service will increase as a result of these dismissals. Therefore, I say that to argue that these people are surplus cannot be justified on the facts.

The Prime Minister, realizing that it is necessary to make some sort of defence against the statement that this figure was just a stab in the dark, said that the matter was given every consideration by a Cabinet sub-committee and a special committee over which Mr. Dunk, the Chairman of the Public Service Board, presides, and that these gentlemen have been combing through the departments and have made certain recommendations to the Government. It may be perfectly true that certain investigations have been proceeding, but nobody can argue that these dismissals- arise out of any recommendation of either the Cabinet sub-committee or the special committee, because the Prime Minister himself said that the reports of those bodies would not be available until the 30th September. To-day is only the 2nd October, yet many of the 10,000 public servants to be dismissed have already received their dismissal notices. How could those dismissals have arisen out of any investigation held by the Cabinet sub-committee or by the committee over which Mr. Dunk presides?

Anybody who listened to the honorable member for Warringah would imagine that the 10,000 persons to be dismissed would become 10,000 additional employees for work elsewhere. Many of those dismissed public servants are disabled ex-servicemen who are within a few years of retirement. To put them out of the positions for which they have been. trained, and which they are adequately filling, merely means putting them out on to the pension list. It does not mean that they will become more profitably employed in the interests of the national economy. The Government has issued an arbitrary direction to the departments to reduce their staffs by 5 per cent, regardless of what work the employees to be dismissed are engaged on. The records of the House will show that there is not one honorable member on either side who has not raised, by way of questions to the Postmaster-General (Mr. Anthony), the subject of the need for extending the services of the PostmasterGeneral’s Department and of making a special effort in an endeavour to overtake the lag in the provision of telephones and other services provided by that department. So every honorable member must be aware that there is no justification for the dismissal of anybody from the Postmaster-General’s Department. As a matter of fact, the Postmaster-General himself has realized that some argument must be advanced to satisfy the public that these dismissals are warranted. So he has said that they are being carried out because insufficient material of certain kinds is available for work carried out by his department. I have been advised by men employed on such work in the Postmaster-General’s department that many of the underground telephone cables that the Minister has said are in short supply, have been laid and that all that- is required now is that they be connected to homes in the districts in which they have been laid. The men who would be employed in connecting these telephones and so making them revenue-producing are among the employees who have received dismissal notices. To realize how ridiculous the whole thing is it is only necessary to know that the Postmaster-General’s Department has sent special officers overseas to recruit cable jointers, because such workmen are urgently needed in Australia, whilst among the public servants who have received dismissal notices there is, I understand, a number of cable jointers. The department tells these men that if they go to Amalgamated “Wireless (Australasia) Limited or Standard Telephones and Cables Proprietary Limited, they may find employment for themselves. During the last sessional .period I asked the Postmaster-General a question, and in his reply be admitted that certain materials required by his department were being manufactured in the department’s own workshops more cheaply than they were being produced outside. Yet some of these manufacturing activities are being curtailed and the men engaged in them are receiving dismissal notices at a time when, according to the PostmasterGeneral, there is a shortage of these materials and equipment for use by his department.

Now I turn to the subject of overtime. Will any honorable member seek to justify the working of overtime in the Public Service at a time when the Government proposes to dismiss .10,000 persons from that service? If the Government believes that more persons are employed in the Public Service than there is work for, then it would be justified in ordering a thorough examination of the matter. But it should not have made just a blind stab at a figure and said, “ We are going to dismiss 10,000 public servants regardless of what effect the dismissals will have on the service to the public. I shall instance the position in the Taxation Branch to show how serious this matter is. The branch has decided to reduce its inspectorial staff, and has issued an instruction that, because ‘ of lack of staff, only one assessment out of every ten is to be examined. What will be the position in this country when we have the Government talking’ about imposing higher taxes and at the same time reducing the inspectorial staff of the Taxation Branch? It is inviting people to evade payment of income tax. The public should be kept fully informed of such aspects of this matter. It is important to ensure that the community shares the burden of taxation that is imposed by the law, and that people should not be afforded opportunities to evade their share of the burden.

The Prime Minister said that the Public Service Board had made a recommendation about the order in which these dismissals were to be effected. So it did, but not all government departments abided by the recommendation. Some of them propose to act on secret reports from departmental heads in deciding who should go and who should be retained. I understood the Prime Minister to say that the last to go would be ex-servicemen. If that principle had been applied no exserviceman should have received notice of dismissal. However, some of ‘them have been dismissed from the Repatriation Department, and New Australians working in the department have been retained. I do not say that New Australians are not entitled’ to be employed, but they should not be employed in preference to men who have fought for Australia. The Government is- always talking about preference to ex-servicemen, but here are the particulars about one ex-serviceman who has been dismissed from the Repatriation Department recently. He is a 100 per cent, war pensioner. He served in the two world wars and was a prisoner of war. For six months he received treatment in the Repatriation Hospital at Randwick. The first intimation he received of his dismissal was in the form of a registered letter delivered through the Williamstreet Post Office, Darlinghurst, informing him that his services had been terminated. Does the honorable member for Warringah believe that that man’s dismissal will help to overcome inflation? His war disabilities are such that the field of employment open’ to him is very limited. He can follow only a sedentary occupation, and in the Repatriation Department he was provided with suitable work; yet the Government, on the plea that something must be done about inflation, has thrown out of employment this returned serviceman who is suffering from a 100 per cent, disability. I do not mean that he is totally and permanently incapacitated, but his injuries are such that he is receiving a 100 per cent, war pension.

I said that some departments were not following the recommendation of the Public Service Board. One that is departing from the recommendation regarding the order of dismissals is that in which the son of the honorable member for Warringah was acting secretary. I have here a letter signed by him, and addressed to District Officers of the

Department of Labour and National Service. It is written on the official note paper of the department, and is marked “Personal and Confidential”. It contains some amazing statements. I do not propose to quote the whole of the letter because it is too long, but I quote this part, which refers to the proposed dismissal of 10,000 Commonwealth employees -

I want to refer to the incidence on the Commonwealth Employment Service of the Government’s decision to reduce the Public Service by 10,000.

Obviously, that reference is to the proposal of the Government to reduce the Public Service by 10,000. Let us see whether the Department of Labour andNational Service proposes to adhere to the suggested order of dismissal, under which married women would go first, then men over the retiring age, and so on. Accompanying the letter there is a form to be filled in by the officer concerned. I quote again from the letter -

Enclosed with this letter you will find a report form. I want you to complete this form in duplicate in relation to each member of your staff, including the staff of branch offices under your control, and send the completed forms in a personal and confidential envelope addressed to your regional director. No copy is to be retained by you.

Why not? If the officers are heads of sections it is to be assumed that they are responsible men. Why, then, are they asked to supply information without keeping a copy? The letter goes on -

In completing this report, I want you to put out of your mind any personal feelings and to give a frank and honest answer to each question. I want, in short, your completed form to be an objective appraisal of the characteristics of each member of your staff. You will bear in mind that unless von do this you will be in danger of prejudicing not only individuals of your own staff but of staff in other offices and of yourself.

Your own views will be checked by others who know those upon whom you arc reporting, mid this will enable me to form conclusions about your own sense of responsibility, your capacity as a manager and your suitability for the position you hold.

The letter was signed by Mr. Bland, the son of the honorable member for Warringah. Although the Minister for Labour and National Service, when challenged, produced the form which accompanied that letter, the letter itself was never produced at any stage, because the Government’ could not defend it, or defend the practice, a new one in this country, of asking responsible officers to report on their subordinates under a threat that if the report were not satisfactory to the Government their own positions would be in jeopardy.

Every one knows that the statement of the Prime Minister does not set forth the facts, but was deliberately designed to prevent the public from knowing the truth. I say deliberately that the Government is trying to organize another depression. As a matter of fact, the honorable member for Warringah does not worry about the prospect of people losing their employment. He views the matter with the detachment of a professor looking at a specimen. He does not seem to realize that we are dealing with human beings. He would be in his element if dealing with microbes, but this is a matter which touches men and women.

Although the Prime Minister spoke of these officers as temporary employees, most of them have given many years of service to the Commonwealth. It may not be generally known that hundreds of officers who have served most of their working lives in the Public Service are still classified as temporary. They have not just drifted into the Service for a few monthsto do a special job in the expectation of drifting out again. The Opposition would not object to the holding of an inquiry with a view to learning whether there is, in fact, a surplus of employees in the Public Service. That would be one thing, but this mass dismissal of 10,000 persons from the Service is just a blind stab in the dark. It is not based on factual information gathered by a cabinet committee or submitted by the Public Service Board. It may be that there are Commonwealth employees whose services are of no great value to the community. For instance, I understand that the Minister for the Navy (Mr. McMahon) has a chauffeur who drives him regularly to the golf course.

Mr SPEAKER:

– Order!

Mr WARD:

– I would say that that was an example of wasted man-power. Ministers should set an example to the community if they want us to believe that a reduction of the Public Service should be undertaken. I repeat that the Government has set out to organize a depression.No proper inquiry has been made to discover which officers are necessary and whether there are any whose service could be dispensed with. As a matter of fact, all the evidence is against the proposition that there is surplus labour in the Public Service. We know that a good deal of overtime is worked, and some of those who have been dismissed were working overtime until the very day upon which their notice of dismissal expired.

Mr SPEAKER:

– Order ! The honorable member’s time has expired.

Mr GULLETT:
Henty

.- I thought that I was going to have to congratulate the honorable member for East Sydney (Mr. Ward) because it was not until the closing phase of his speech that he managed to drag in the depression and tried to confuse the issue. Had he not mentioned the depression, this would have been the first occasion since I have been in this House on which he had not done so. Honorable members have heard enough of depressions. A depression will eventuate only if the Government is so foolish, in these prosperous years? to spend all its money and keep nothing against the day when hardship and unemployment will come upon us. It is to prevent that situation from arising that the Government has had to take this and a number of other unpalatable measures. The honorable member said that some of those who were dismissed had worked overtime. I do not doubt that that is correct.No honorable member can afford to antagonize public servants, because all of us depend, to a greater or less degree, on the support of votes from members of the Public Service, but in that service, as in any other great organization, there is a certain number of loafers and a great deal of overtime is worked at night by people who loaf in the day time. That remark may get me where it will, but I think it should be said that people loaf on the job during the day for the express purpose of earning overtime at night.

Mr.Curtin. - That is an insult.

Mr GULLETT:

– I could quote instances of this practice, but I have never, made it a practice to mention public servants of greater or less degree by name in this place. The honorable member said that disabled ex-servicemen had been discharged. That is news to me. If that has happened those men were unfortunate in their connexions with their local member of Parliament or other representatives who could, most surely, have taken up their cause. When a man in my own electorate was discharged by the Department of Trade and Customs I wrote to the Minister pointing out that his dismissal was contrary to the provisions of the Re-establishment and Employment Act. An inquiry was instituted immediately and that man was reinstated in his employment. It was stated that, as a matter of Government policy, there would be no interference with the Re-establishment and Employment Act. If the facts as outlined by the honorable member for East Sydney are true, in order to have the man reinstated, if his health will permit, it will only be necessary to approach the Minister for Repatriation (Senator Cooper). I am certain that such a sympathetic and decent Minister will correct that state of affairs and I do not believe that any honorable member believes the contrary.

The allegations that have been made concerning the dismissal of an arbitrary figure of 5 per cent, of employees are simply incorrect. It is not correct to say that any order was given to dismiss 5 per cent, of the staff of the Postal Department, 5 per cent, of the staff of the Taxation Department, 5 per cent, of the Department of the Interior, or 5 per cent, of any other department. Nothing of the sort was intended. It would be very surprising to me to find that a single efficient operative had to be dismissed from the Postal Department. An extraordinary letter was produced by the honorable member for East Sydney in support of his arguments. Letters have been produced in this House previously which had been stolen or forged and I do not know how a letter of this nature could have come into the possession of the honorable member by legitimate means. If the honorable member is so confident of its authenticity let him, as the rules of the House allow - and even demand - table this letter.

On the subject of the misuse of Government transport, I agree with the honorable member. If government transport or the services of personnel have been misused by Ministers or any one else the Government’s duty is to correct that position. But the honorable member is not the man to cast the first stone in this matter. What has been referred to as a “ reduction of the Public Service “ could be more accurately described as a decision by the Government not to increase the Public Service, because there has been no decrease of the total number of employees.

If it is to be understood, this decision must be examined against the background of certain events and certain undertakings that were given by the Government on the occasion of the last general election. A few months ago a record rise took place in the cost-of-living index figures in Australia, and it was borne in upon everybody at that time that that was largely due to excessive spending power and, particularly, to excessive spending by governments. There was a general demand by the people and the press that governments, in particular, should cut down expenditure. It staggers me now to see those same newspapers which so short a time ago demanded reductions of staff in various, departments emitting terrible screams about 10,000 people being dismissed and alleging that that will cause unemployment. These newspapers could not make more noise if the Government proposed to behead 10,000 employees. That is complete hypocrisy on the part of the press.

This reduction of government expenditure must be effected. The Government is acting in accordance with its policy and in conformity with the desire of the great majority of the people. This matter must be considered against the background of the times. This is a. time of tremendous prosperity. Despite any superficial inconveniences, it is a time of unrivalled prosperity and the fullest possible employment. This is not the time for government expenditure to provide any employment other than that which is most essential. Some reference was made by the honorable member for East Sydney to the dismissal of employees in Victoria. Those dismissals are entirely the responsibility of the Government of Victoria. The Government of Victoria, which is basically a Labour government, knew perfectly well the amount of money that would be available to it to finance its works programme. It had ample time to make a proper disposition of that money but” thought that it would bludgeon the Australian Government into giving it all that it wanted. When it did not receive the full amount asked for, it engaged in wholesale sackings. That is entirely its own fault. There never was a government so lacking in basic honesty and decency and so desirous of hanging on to office at any price as is the Government of the unfortunate State of Victoria.

This is a prosperous period. It is a good time for governments to draw in their horns so far as expenditure is concerned. Consequently, the Public Service is well able to bear a certain reduction of staff in the ways that the Prime Minister outlined to the House this afternoon.

Mr J R FRASER:
ALP

– The statement by the Prime Minister (Mr. Menzies) constituted an amazing attempt to justify a completely wild and inept decision to impose an arbitrary cut on the Public Service and on other Government employees. Despite the long recital by the” right honorable gentleman of investigations, committees and reports, it is perfectly obvious that the Government did not seek the advice of experts in this matter, but that it gave a directive to the experts and told them to justify its decision. A report of a conference between the Joint Central Committee of the High Council of Commonwealth Public Service Organizations and the Chairman of the Public Service Board on the 20th August reads as follows : -

The chairman indicated at the outset that the board had received a direction from the Government to reduce the overall staff on the Government’s pay-roll by 5 per cent., which, on a figure of approximately 200,000, including those under the Public Service Act and those outside the act, required a reduction by 10,000 dismissals or other means of reduction of staff. The chairman stated that the board did not relish the duty of having to reduce the staff as directed, because it was considered by the board that many of the services now rendered to the public would have to be curtailed if the dismissals were made as directed.

A later passage in the report reads -

The chairman indicated that the Govern- . ment’s instructions were definite and therefore the board had no alternative but to proceed a* directed. He stated that the board would most carefully consider the matter and when applying the Government’s proposal would 11 S the utmost care in an endeavour to avoid hardships.

So much for the Prime Minister’s statement that these dismissals are being effected after comprehensive investigations and reports to the Cabinet by various bodies. I believe that the Public Service Board has been directed to justify a figure that was plucked out of the air by the Prime Minister and foisted on the Cabinet. In conference with the Joint Central Committee of the High Council of Commonwealth Public Service Organizations on the 24th August the Prime Minister agreed that he would, within one week, prepare a statement on the Government’s proposals relating to the anti-inflation programme, and the part that the Public Service had to play in the programme, and that he would supply the committee with copies of the statement and also supply a copy to the press. Far from doing so, two weeks beyond that date, on the 8th September, the Prime Minister wrote to the president of the High Council of Commonwealth Public Service Organizations in these terms -

I feel now that the matter is of such importance that a statement should be made in tinfirst instance to the House, and this will bo done on the first day or week of the next sittings, which will commence on the 26tl September.

The notices of dismissal served on public servants and other government employees were effective from Friday last, the 28th September. The Prime Minister has made his statement four days after the dismissal notices took effect. No opportunity was given to honorable members on either side of the House to state their views on the decision before it was given effect. Members of the Public Service will know what value they can place on the Prime Minister’s statement, and they will place their own interpretation on his absence from the House immediately after having made it.

The effect of the dismissals is very noticeable in Canberra, in which there is a concentration of Commonwealth departments and of public servants and other Commonwealth employees. It is evident from the facts known in Canberra that no attempt has been made to abide by the order of dismissal issued by the board. One of the first to receive notice of dismissal in the Australian Capital Territory was a married man with five children. No attempt was made to apply the principles of the order in his case. In the department in which he was employed a 70 per cent, cut was imposed in one section in order to achieve a 5 per cent, overall cut. After weeks of doubt and uncertainty about the future, he has found other employment in a government agency.

Mr ERIC J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– It would be strange if he had not done so. There are 200,000 unfilled vacancies in the Commonwealth at present.

Mr J R FRASER:
ALP

– The point I make is that the man has found employment in a government agency. If his subsequent re-employment does not cancel out his dismissal by one, I do not know what would do so. There is also the case cited by Mr. Alan Reid in the Sydney Sun last Tuesday of a widow who was sacked from a job in one government department and employed in another. Another case is that of a single man who received notice of dismissal from his employment as an officer of a Commonwealth department at Civic Centre and within half an hour, as a result of the intervention of a friend who had a friend employed by the Public Service Board, was re-engaged in another Commonwealth department. Did not that re-engagement cancel out the dismissal?

The statement has been made by the Prime Minister and repeated by many honorable members opposite that the purpose of the dismissal of public servants is to release men for employment in private industry as a means of increasing industrial output. Let us examine how the Government has gone about the task. Responsible officers went to a capable and efficient ganger working on the roads of Canberra, a man 67 years of age, and served him with a notice of dismissal. That man will not go to industry; he will merely become a pensioner, and a younger man will take his place. Another elderly man, who was employed on the water supply services of Canberra, was also dismissed, although he was perfectly capable of doing his job efficiently. He, too, will join the ranks of the pensioners, and a younger man will take his place. Recently the members of a small road gang employed in Canberra were told that they would have to work on Saturdays because of the volume of work to be undertaken. On the Tuesday following the day on which the direction was issued an officer of the Department of Works and Housing asked the ganger in charge how many men were employed in his gang. The ganger replied that the gang consisted of nine men. The officer of the department thereupon said, “ Put off your three weakest “. What an echo of the depression years such a direction might be! Will the three weakest men be employed in industry and so increase industrial production? Not at all.

In Canberra and throughout the Australian Capital Territory houses are being built by the Government for occupancy by public servants and employees of private industry under three systems : by day labour, by direct contract, and by cost-plus contract. The Department of Works and Housing has given notices of dismissal to carpenters, bricklayers and others employed on day-labour housing projects, attached to which were slips which stated that if the men concerned reported to certain contractors who are engaged in building houses for the Government under the cost-plus system they would secure re-employment. In fact, officers of the department were sent to costplus jobs to ask the contractors whether they could employ the men under notice of dismissal, notwithstanding the fact that the Director of Works at Canberra has stated on more than one occasion that houses built by day-labour are built better, quicker and more cheaply than are those built under the cost-plus system. That statement is borne out by officers of the Department of the Interior whose duty it is to assess the rents charged for cottages in the Australian Capital Territory. They know that houses can be built better, cheaper and quicker by day labour than by the system of cost-plus. But men who have been building houses for the Government under the day-labour system are being struck off the pay roll. Doubtless they will continue building houses, but they will build them for contractors who are paid by the Government under the cost-plus system. Ultimately the houses built by these men will cost the Government more, and take longer to complete. Moreover, people who are waiting for houses in the Australian Capital Territory and other parts of Australia will not relish this decrease of the Public Service because it will mean. that they will have to wait much longer for their cottages. I suggest that this rule for the dismissal of public servants is completely stupid and dishonest.

In the Department of Works and Housing members of the Royal Australian Institute of Architects, Engineers, Surveyors and Draftsmen have been given notice. Seven such men to my knowledge have received notice of dismissal. Among those men are architects, engineers, married men and at least one exserviceman. Despite the fact that their families and their homes are in the Australian Capital Territory, last month they were given notice of dismissal. A remarkable fact is that at page 9 of the September issue of Architecture, the journal of the Royal Australian Institute of Architects, there is an advertisement which reads -

Commonwealth of Australia.

The Department of Works and Housing urgently requires architects in all States, the Territory of Papua-New Guinea, the A.C.T. and the Northern Territory.

I also refer honorable members to the Commonwealth Gazette, No. 68, dated the 13th September, 1951. Honorable members may there see advertisements by the Department of Works and Housing for engineers (mechanical), grade 3. It is noteworthy that engineers of the very same classification were dismissed from the Public Service by notice given during the month in which that Gazette was issued. I suggest that the Government does not know where it is or what it is doing.

Every honorable member knows that in some areas their constituents can obtain a telephone only if they are willing and able to find some one who will share a duplex telephone. But when a duplex telephone is applied for very often the Postal Department notifies the applicant that linemen are not available to make the necessary connexions. Yet linemen are being dismissed! For some time in the Canberra Post Office the fortnightly average number of hours of overtime worked has been the same as it was during the last fortnight, in which 465 hours overtime were worked at a cost of £189 to the Postal Department. That overtime is equivalent to the weekly employment of six more men. But the rate paid for that work is far in excess of the rate which would have been paid to men working those hours in a 40-hour week. In the same fortnight in the telegraph section of the Canberra Post Office 101-J hours overtime were worked at a cost of £55. That represents the work of more than one additional permanent man. In the engineering section, which extends services and performs other functions, in a fortnight 320 hours overtime were worked at a cost of £150. That is equivalent to the work of four men. It is fantastic that in the light of those facts these steps are being taken to reduce staff. The Canberra postal section of the department is already understaffed and needs seven men. In reply to a question the Postmaster-General (Mr. Anthony) said that many men now being dismissed would have been put off in any case because of the shortage of materials. How there can be a shortage of materials while the engineering staff has to work overtime is a matter beyond my understanding. Perhaps some honorable member on the Government side will explain it.

Mr BOWDEN:
Gippsland

.- I do not want to contribute much to this debate, and I should not speak at all if I thought that it would cause distress to honorable members opposite while they are attempting to make out a case against the Government’s actions. However, I admit that the honorable member for the Australian Capital Territory (Mr.J. R. Fraser) represents an area that is in a somewhat different position from that of other areas in Australia. He represents the Australian Capital Territory where not many capital works other than government works are in progress, and it is reasonable to assume that men retrenched from the Public Service in Canberra will have to go outside the Territory to find employment. In their case I hope that the Minister will not regard their houses as being vacant until they have had reasonable opportunity to obtain other accommodation elsewhere. Generally speaking, the noisy speeches of honorable members opposite can be regarded as “ much ado about nothing “. I remind honorable members that only 10,000 public servants out of 160,000 will be dismissed. Perhaps if the number were 30,000, honorable members opposite would still have a struggle to find reasons to advance against the Government’s action. That is particularly so in view of the fact that vital industries which are expected to make up the shortages in our production still require labour. This action is a government contribution towards the full manning of essential industry.

The 10,000 people who will be dismissed include not only clerical workers but also workers in capital projects. In the last few years I have witnessed more cold-blooded loafing in Australia than would have been possible in any other country. That has not been solely due to the workmen, but has been the result of a lack of overseers. Their loafing is the fault of the people who allow them to do it. If an approach were made to the men who are now being retrenched, among whom are perhaps men who have been receiving £30, £40 and £50 a week while working with their trucks, they would probably admit that they had brought this action on themselves by failing to give a fair return for such money. Responsibility for that attitude rests on those who were supposed to see that they were fully employed. Some men have stated that although they were receiving huge wages they were fed up with their jobs because they had not enough to do.

Mr Ward:

– The honorable member means the wool-growers?

Mr BOWDEN:

– No, these were men who had worked in electrical undertakings and enterprises of that sort. I can well understand that a proposal of this kind is obnoxious to socialists, because it is well known that their objective is to bring everybody round to their way of thinking. One of their means of doing this is to magnify shortages of supplies, and to attempt to bring about chaos in this country so that their plans will be more likely to bear fruit. That is what these gentlemen want. Let us make no mistake about it. Any move by this Government to put value back into the £1, as the Opposition has continually urged that it should do, is recognized by that same Opposition as being detrimental to their ultimately regaining the confidence of the people. If half the reports that have appeared in magazines about loafing on public works are true, I should say that perhaps 15 per cent. of the Government’s employees could be dismissed without loss of efficiency. If all the men would do a fair share of the work, then more work than is now being done would be done by half the number of men now employed. Because of the cold-blooded loafing, which all honorable members opposite know about, more men than are really necessary have had to be employed. The Public Service has grown in a ridiculously short space of time from 100,000 to 160,000 members. Honorable members opposite want it to continue to grow, irrespective of whether its members are gainfully employed or not. The Opposition does not care whether chaos reigns and the country goes to perdition. No one can deny that our economy to-day is chaotic, and that unless the problem of inflation is tackled speedily, it may lead us to destruction. A chaotic economy is a breeding ground for communism, but honorable members opposite made certain recently that communism in this country would not be tackled effectively.

Mr SPEAKER:

– Order ! The honorable member must come to the motion now under discussion.

Honorable members interjecting,

Mr SPEAKER:

– Order! For the last time I ask the House to preserve order.

The conduct of honorable members is becoming very disorderly. From now on I shall act.

Mr BOWDEN:

– Members of the Australian Labour party are what may be termed the progenitors of the 40-hour week - allegedly a 40-hour working week but in reality a 40-hour non-working week, because that is the effect that so much overtime is having. As the honorable member for Henty (Mr. Gullett) has said, if men worked harder in ordinary hours, there would not be any need for so much overtime. I am referring now, of course, not to public servants but to the employees in industry generally.

Mr Curtin:

– How long is it since the honorable member himself worked?

Mr BOWDEN:

– I could work the honorable member for Watson blind any time. He has never done any work himself, and probably has never seen any work done. The honorable member for Burke (Mr. Peters) claimed that there was a lack of confidence in this Government because of certain actions that it had taken. That is the customary cry of the people who are being hurt by the Government, but I am certain that when the Government’s policy has been fully implemented there will be the uttermost confidence in the Administration and in this country. Our economy will be so stabilized that every industry will have the fullest encouragement to produce to its maximum capacity.

The honorable member for Burke, who has led the Opposition’s attack on this matter, claimed that the Government was destroying full employment. What an absurd statement for any honorable member to make ! He claimed that the curtailment of public works in Victoria had thrown 6,000 employees out of work, but I remind him that the Victorian Chamber of Commerce has stated that its members could absorb 1S,000 public servants within 4S hours, and guarantee them full employment. In the face of such an assurance, how can the honorable member talk of the Government destroying full employment and discouraging confidence in this country? Throughout Australia 150,000 unfilled jobs are listed. Already quite a number of Commonwealth public servants in Melbourne have found better permanent jobs elsewhere. In these circumstances, how can any one talk seriously of unemployment in this country? Of course, honorable members opposite are seeking the retention of unemployment of the type that exists to-day under so-called “ full employment “. Many employees ave not earning their wages or salaries. We shall only begin to stabilize our economy when full value is given for money that is expended. Easy money means waste. When money is not so easy to get as it is to-day, those who pay it out will be more likely to receive full value for it, and inflation will be halted. To-day, inflation is running mad and a big contributing factor is an. over-abundance of public servants who “ toil not neither do they spin “. Their employment is not reproductive in the selling sense. The money that they receive competes on the under-supplied markets which their non-reproductive employment in the Public Service helps to deplete. When we solve that problem we shall solve the problem of inflation. If honorable members opposite were on the Government benches they would have no hesitation in retrenching 15,000 or 20,000 public servants, but because they are in Opposition - politically, the Australian Labour party in this Parliament has never been in a worse position in its history - they believe that they must oppose everything. They are trying desperately to “engender an a tmosphere that will be f avorable to them. They will find that most difficult because the “ red “ element will be thrown into their faces for a long time to come. If the Communists act as I believe they will act as the result of the confidence that they have gained from recent events, members of the Australian Labour party will be hard pressed to justify their existence in a united, advancing Australia.

Mr COSTA:
Banks

.- I agree with my colleagues who have claimed that the Government made no thorough investigation before announcing its intention to dismiss 10,000 public servants without even consulting the Public Service Board. After listening to the honorable member for Gippsland (Mr. Bowden), it is clear to me that the number could just as easily have been 20,000 or 30,000. Obviously, at a Cabinet meeting some one was asked to think of a number, double it, and take away the number he first thought of. The Minister for the Army (Mr. Francis) then said “‘10,000”. Everybody else said, “ Right oh, out with 10,000 ! That was the extent of the Government’s investigation. The Prime Minister (Mr. Menzies) has said that the matter was investigated by a special committee, the members of which he named. I noticed that the committee did not include a representative of any of the Public Service organizations in spite of the Prime Minister’s election promise that consultation with employees’ representatives would be a feature of the Government’s plan to improve industrial relations in this country. One honorable member has suggested that a royal commission should be appointed to investigate the Public Service. I remind the House that, in the Public Service Board we have what may be regarded as a permanent royal commission. The board consists of a chairman and two commissioners. Its functions are to investigate the staff required by the various departments, to limit the recruitment of staff to actual requirements and to ensure that all available staff shall be employed to the best advantage. By arbitrarily announcing the dismissal of 10,000 employees the Government has usurped the functions of the board. I was a public servant and I know that before a position is created the circumstances are investigated fully by the board. According to reports of the Public Service Board, staffs should be increased rather than diminished. Thus, the Government is acting contrary to advice tendered to it by the very body that is best qualified to give advice in matters of this kind. The sacking of 10,000 employees is absurd when practically every section of the Public Service is working overtime in order to maintain and expand essential services.

I propose to indicate the effect that such action will have in various departments. Approximately 500 telegraphists at the Telegraph Branch of the Sydney General Post Office are now working six hours a day overtime, and as the weather becomes warmer the volume pf overtime will be increased. Overtime being worked by those telegraphists is equal to 3,000 normal man hours weekly and as overtime is paid for at the rate of time and a half the department is paying for 4,500 man hours under that heading. At present, the Telegraph Branch at the Sydney General Post Office is 70 telegraphists short and payment of overtime in this instance equals payment at ordinary rates for 110 telegraphists. It is estimated that due to the existing shortage of telegraphists that branch is losing £25,000 per annum. The Government will aggravate the position by sacking public servants. Numbers of telegraphists employed in the Sydney telegraphs branch have received notices of dismissal. A similar position exists in the engineering, telephone and mail branches. The sacking of employees in the face of staff shortages in the PostmasterGeneral’s Department is sheer idiocy. At present, every two employees in the Postal Department are doing the work that would be done by three employees under normal conditions. It is absurd for the Government to sack employees when by doing so it will not curtail expenditure. The implications of the Government’s decision and the effect that it will have upon important public facilities are not fully realized. The Postal Department provides in all parts of the Commonwealth services and facilities to a greater degree than does any other authority. Approximately 4,000 of its employees who are being dismissed were engaged upon the installation of telephone equipment, the laying of cable and the erection of aerial line routes in efforts to meet growing public requirements. By sacking these employees the Government will not do anything to check inflation. On the other hand, it will deny to over 100,000 applicants for telephone services any possibility of receiving such services for years to come. Every honorable member receives requests daily from constituents to help them to obtain telephone services or improved postal facilities. These dismissals will aggravate that position.

The Postmaster-General (Mr. Anthony) on the 27th June last, in his second-reading speech on the Post and Telegraph Rates Bill, said -

Any curtailment of services to the public would cause grave difficulties and would not be in the interests of the community, having regard to the vital importance of the communication services. Such a curtailment would necessitate dismissals of thousands of specially trained men and also lead to a serious loss of revenue. I would not entertain the proposition for one moment.

However, a few weeks after the PostmasterGeneral made that statement the Government directed the Public Service Board to reduce by 10,000 the personnel of the- Public Service. The dismissal of approximately 4,000 employees in the Engineering Branch of the Postal Department is a definite repudiation of the Postmaster-General’s statement which he made when he was seeking the Parliament’s approval for all-round increases of postal charges ostensibly to maintain and improve facilities Those very facilities are to be curtailed as the result of these dismissals and the reduction of the department’s Estimates by £6,000,000 during the current financial year. How can the Government justify such action when the Treasurer (Sir Arthur Fadden has budgeted for a surplus of £115,000,000? Despite the impositions and sacrifices involved in the budget, the public is now to be denied promised postal services and facilities which could be provided out of the anticipated surplus. The Government should offset the cut of £6,000,000 in the Postal Department’s Estimates by allocating £6,000,000 of that surplus to essential works.

The fallacy of these dismissals must be plain to every honorable member, particularly when employees of the Department of “Works and Housing are to be dismissed and, at the same time, various works are to be let to contractors on a cost-plus basis. The Government will still have to foot the bill. Telephone equipment ready for installation in new exchanges at Dalley-street, Sydney, North Parramatta, Pennant Hills and Sutherland, New South “Wales, has been crated and returned to stores. Iron posts and wire for trunk line routes to Melbourne are lying on sites between Jerilderie and Deniliquin, Carcoar and Blayney and Young and Temora whilst men are being dismissed from those jobs. These dismissals are completely unjustified and will not enable the Government to achieve the objective that it claims- it has in mind. They will intensify the inflationary trend because, as a result, fewer employees will receive increased wages by working overtime. This is a step towards the Government’s objective of establishing a pool of unemployed as was advocated by Professor Hytten. The proposal has not been properly investigated. The Government has not given any thought to the hardships that dismissals are likely to inflict upon many individuals. The honorable member foiEast Sydney (Mr. Ward) mentioned specific cases in that respect and I know of many similar cases in my own electorate. Many females who, owing to incapacitation of their husbands, have accepted work in the Postal Department in order to maintain their families, will be dismissed. I repeat that these dismissals will not check inflation and will not improve the efficiency of the Public Service.

Mx. HOLT (Higgins - Minister for Labour and National Service and Minister for Immigration) [5.29]. - Ordinarily, I should not have found it necessary to interpose in this debate because the Prime Minister (Mr. Menzies) has set out the Government’s position very clearly. All fair-minded people who examine what he has said will commend the Government for its action. Nonsense has been talked in this debate about the Government endeavouring to establish a pool of unemployed in this country. Such a statement is sheer nonsense because, as the Prime Minister mentioned, over 125,000 vacancies throughout the Commonwealth are registered with the employment office of the Department of Labour and National Service. That is by no means the total number of positions that are waiting to be filled at present. I invite any Opposition member to produce one instance as evidence that a person who has been retrenched under this procedure and has tried to get another job, has failed to obtain employment. That is the best test of how much unemployment we have caused in this country. The plain fact of the matter is that, throughout the length and breadth of Australia to-day, there is idle capital and equipment in vital industries, simply because we have not a sufficient number of men to do the job. I am certain that honorable members opposite have not so quickly forgotten the statements of their own leaders, including the late Mr. J. B. Chifley, who discussed with them and with the leaders of the trade unions the policy of full employment. He made no bones about the matter, and said that it was not a part of the Government’s employment policy to allow essential industries to be starved while less essential industries had all the labour that they wanted. I am prepared to quote at a suitable time a passage from the statement of the late Mr. Chifley on that subject:

My real reason for participating in this debate .is prompted by some remarks which, I understand, were made by the honorable member for East Sydney (Mr. Ward). Ordinarily, I should not have troubled myself very much with what the honorable member had to say, but I gather that what he said reflected in some way upon the conduct of officers of the Department of Labour and National Service, which I administer, and I feel that, in fairness to them, I should place the facts before the Parliament.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– The statement by the honorable member for East Sydney was also a reflection’ upon the Minister.

Mr HOLT:
LP

– I shall deal with any reflection that has been cast upon myself, and when I do so, I shall not require any help from the honorable member for Hindmarsh (Mr. Clyde Cameron). I gather, although I did not hear in precise terms, what the honorable member for East Sydney said, that it followed what was said by him during the recent referendum, campaign, and I shall deal with the matter on that basis. The honorable gentleman referred to a letter that was sent from the then acting head of the Department of Labour and National Service to district employment officers throughout Australia. I shall deal with the facts. The acting head of my department was told by me, following Cabinet’s decision on the estimated retrenchment that would be necessary in the Department of Labour and National Service, that retrenchment was to take place principally in the employment division. He asked me, and I think that it was a. very proper question, whether he could assume that I wished such retrenchments to be made on the basis of efficiency. He asked, in effect, whether 1 wished that, following those retrenchments, we should be left with the most efficient employment service that the department could provide. I said, “ I want you to make your cuts solely on the basis of efficiency, and without fear or favour in any other direction “.

Mr Ward:

– What about the Prime Minister’s statement ?

Mr HOLT:

– The acting head of the department was acting fully in accordance with the procedures that were laid down by the Chairman of the Public Service Board.

Mr Ward:

– That cannot be, because the two are in conflict.

Mr HOLT:

– That is a matter for judgment. Within the order of procedure that had been laid down by the Public Service Board, the acting head was to determine as between one and another in those respective classifications on the basis of efficiency. For the carrying out of that instruction, not at my suggestion, but from the knowledge that the acting head of the department had acquired, because it is in frequent contact with other employer organizations, a simple form of employee rating was drafted. That is common practice in organizations that have large num’bei’3 of employees, and those who are responsible for staffing are not able readily to get to the centres in which staff is employed. Obviously in any large, decentralized organization, it is not possible always for those who make the final decisions to be in all the centres in which the employees are placed. Therefore, it is quite common practice in organizations of that kind to have methods of employee rating. A simple document was prepared for despatch to each of the district employment officers who are scattered throughout the length and breadth of Australia.

Mr Curtin:

– Did the Minister approve of it?

Mr HOLT:

– I was shown the draft of it before it was despatched, and I approved of it. The letter was marked “ personal and confidential “ for obvious reasons. Naturally there would have to be some determination as between some members of the staff and others, and it was highly undesirable that confidential comments that were made by the district employment officer should be left lying round or should be communicated by him to other members of the staff. I can imagine no way more likely to cause dissension and lack of co-operation in that section of the department than to have that sort of comment bandied about. So, very naturally, the correspondence was marked “ personal and confidential ‘’. Much play has been made by the honorable member for East Sydney on the fact that a passage occurred in the document in which the district employment officer was told that his own comments would be checked by others, and, of course, the honorable gentleman endeavoured to impart some sinister significance to it. Again, that is standard practice, because each department has its own inspectors within the staff, and they would go through the various parts of the department and make their own reports. It was indicated that the comments of the district employment officer would be compared with those that the inspector himself would make. ‘ I do not know of any practical way of making a substantial range of retrenchments in a department such as the Department of Labour and National Service other than that of enlisting assistance and obtaining advice from those who are directly in contact with the employees under them. Such a method was devised in this instance. The honorable member for East Sydney managed to come into possession, by some device, of this personal and confidential document. I may say, at this point, that it is no novelty for him, in this chamber or outside it, to secure and make use of confidential documents that were not intended for him, and the possession of which by other persons, and their communication to him, place them in the position of having committed an offence under Commonwealth law.

Mr Ward:

– I put the public good first.

Mr HOLT:

– The honorable member for .East Sydney has told us on other occasions that he puts the public interest first. He apparently regards it as a small matter to abet the commission of an offence for that purpose. Unfortunately for him, in this case, he produced what

I described at the time as a “ damp squib “. He described it as a secret dossier that had been compiled within the department.

Mr Ward:

– So it is.

Mr HOLT:

– I say that the attachment to the letter was solely in the interests of the employee concerned, and was of a departmental nature. The moment the honorable gentleman made his revelation, I made this document available to the press, and the newspapers were at liberty to publish either the whole or any part of the documents.

Mr Ward:

– The Minister did not make the letter available.

Mr HOLT:

– I did make it available.

Mr Ward:

– The press told me otherwise.

Mr HOLT:

– The honorable gentleman apparently has his spies in all sorts of places. I was asked by the press on the first day this matter was raised whether I could make the document available. At that time I had available to me only the questionnaire, which I gave to the press. I said, “ If you come back to-morrow, I shall see whether I can make the letter available as well.” On the following day, I told representatives of the press that they were at liberty to make use of the letter if they so desired.

The honorable member for East Sydney has seen fit to criticize this particular method of effecting retrenchments within the Public Service. I have waited in vain for Opposition members to make other suggestions about how such retrenchments may be carried out more efficiently. What has been done is the practice that is adopted in a number of large commercial establishments, but I can perfectly well understand that these methods do not commend themselves to Opposition members. We have had some experience of appointments that were made to the Department of Labour and National Service with the full approval of the honorable member and of the manner in which he tried to deal with decisions for retrenchment of its staff. I remind the Parliament that two men who were appointed with the full approval of the honorable member and who became very closely associated with him were the notorious Mr. Garden and the equally notorious Mr. Urquhart. Those two gentlemen featured rather prominently in public inquiry and discussion not so very long ago. They were employees of a type that commended itself to the honorable member for East Sydney when he was Minister for Labour and National Service.

Mr SPEAKER:

-Order ! The Minister should keep to the question before the House.

Mr HOLT:

– I turn now to an alternative method of retrenchment. I gave instructions that retrenchment in the Department of Labour and National Service was to be carried out solely on the basis of efficiency and without paying any regard to what I or any private member of the Parliament might think personally. Political favour was not to enter into the matter. But the honorable member for East Sydney took a very different course of action when he was Minister for Labour and National Service in a Labour government. It was proposed at that time that Mr. Jock Garden be retired from employment in the Department of Labour and National Service.

Mr SPEAKER:

– Order ! The Minister had better keep to the paper.

Mr HOLT:

– The Government has been criticized for the method of retrenchment that it has adopted. I am seeking, with respect, Mr. Speaker, to demonstrate that the method of retrenchment that commends itself to the honorable member who has made this criticism is a method that would not be acceptable to this Government or to the honorable members who support it. On the occasion to which I have referred, it will be remembered, the present honorable member for East Sydney sponsored a telegram that was sent to- the Prime Minister of the day to urge him not to dismiss Mr. Garden from his employment. So anxious was the honorable gentleman to retain Mr. Garden in the position that he occupied in the Department of Labour and National Service that he did not hesitate to use on that telegram the name of at least one member of the Labour party who had not given him any authority to use his name and who actually insisted on his name being withdrawn.

Mr SPEAKER:

– Order ! The Minister’s remarks are outside the terms of the paper that the House is considering.

Mr HOLT:

– This Government has carried out retrenchment within the Public Service solely on the basis of efficiency. At least that is what has been done within the department that I administer. If the honorable member for East Sydney prefers his methods, which I have mentioned, to the methods that we have adopted, he is welcome to them. I leave the matter at that.

The honorable member has claimed on more than one occasion that sources of confidential information within the Department of Labour and National Service are available to him. He made the claim during the last general election campaign. Apparently he is still making use of some leak from the department to which he has access. That is scarcely to the credit of himself, the methods that he uses, or the employee, whoever he may be, who is so disloyal to the department that he is supposed to serve that he is prepared to divulge confidential information when it suits him to do so.

Mr Haylen:

– I think that the Minister has “ leaked “ here this afternoon.

Mr HOLT:

– Well, if the honorable member for East Sydney makes use of confidential information, as he has done during this debate, he must accept the consequences of his action. I repeat that this Government has carried out retrenchment solely on the basis of efficiency. The only direct consequence that has come from the alleged disclosure by the honorable member for East Sydney has been the concern that has been expressed to me by some of the officers who have been dismissed. They complain that a slur has been cast upon them because of the sinister implication that the honorable member gave to the action that had been taken. They have said to me that the very fact that the honorable member has suggested that there is something sinister about this business will make them suspect when they try to obtain employment elsewhere. He has the satisfaction, if it be any satisfaction to him, of knowing that all that he has achieved by his demonstration has been to prejudice the future prospects of employment of persons whose interests he now claims to be serving.

Mr BRYSON:
Wills

.- The remarkable statement that we have just heard from the Minister for Labour and National Service (Mr. Holt) has proved definitely that the members of the Government do not know in which direction they are going. They have no idea of carrying out a particular policy for retrenchment in the Public Service. We have just heard the Minister flatly contradict a statement that was made earlier by the Prime Minister (Mr. Menzies) in this House about dismissals from the Public Service. The Government’s decision to reduce the Public Service is one of the most stupid decisions that any government has made. Merely in order to make a brave show of honouring promises that were made to the people, it has decided that 10,000 employees in the Public Service must go. Apparently it does not matter to the Government whether or not they are redundant officers. They must be dismissed merely to save its face.

The Public Service Board was instructed to decide how the retrenchment should be effected. The Prime Minister has told us that a system was devised to govern the dismissals, but I am doubtful now of the accuracy of his statement because it has been contradicted by one of his colleagues. The right honorable gentleman said that married women were to be dismissed first, that over-age women were to go next, and so forth. Exservicewomen were to be last on the list of females, and ex-servicemen were to be last on the list of males. But, after the Prime Minister had told us that this method had been followed in every department, the Minister for Labour and National Service rose to contradict him and said that, in his department at any rate, the least efficient employees were being sacked. According to him, there is only one sensible method by which staffs can be reduced and that method involves the dismissal of the leastefficient officers. What about the provisions of the Re-establishment and Employment Act? What about all the mouthings that we have heard about preference to ex-servicemen ? The Minister for Labour and National Service has told us, in effect, that he has disregarded the preference requirements of the Reestablishment and Employment Act. He has said,- “ I shall dispose of the least efficient officers and, in order to find out who are least efficient, I shall obtain secret reports from my officers “. We had experience of secret reports previously, and it was laid down that, when such reports were made upon officers of the Public Service, the officers concerned were entitled to see them. But we are getting back to the bad old days. We are to be given another illustration of the fascist ideas of this Government. Confidential reports are to be prepared, and employees who are not liked by those who are in charge of them will be sacked without regard for their efficiency.

We were told that 10,000 public servants had to be dismissed so that they could go into productive employment, increase production and counteract inflationary trends. According to the honorable member for Gippsland (Mr. Bowden) the decision also represents another blow at communism. The honorable gentleman invariably tries to drag the Communist bogy into debates in this chamber, but I had thought that we should be spared such irrelevant sideissues on this occasion. I remind the House that the Postal Department is to lose over 4,000 employees. The Postal Department is one of the biggest business organizations in this country. It has been short of staff for several years. An efficient postal service is definitely necessary if we are to increase production. Such a service is a necessary adjunct to every field of manufacture. We must have efficient telephone, telegraph and mail services if businesses in this country are to continue to expand and increase production. Yet the Government decided arbitrarily that 5 per cent, of the staff of that department had to be sacked by the end of September. Although the Postal Department was already grossly understaffed, the sacking of 4,000 postal employees was ordered. I was a postal employee for a number of years and was on the receiving end of many complaints. In those days it was a standing rule that the first delivery of mail on week-days should be completed by 10.30 a.m. If that delivery was not completed on time we could expect trouble from the head of the section. To-day, however, it appears that that rule no longer applies. At 4.30 p.m. on Saturday, the 22nd September, in a suburb of Melbourne, I observed a female postal employee delivering mail that should have been delivered in the morning, because the available mail delivery staff at the local post office was about 50 per cent, below requirements. I am sure that that is the position generally at post offices throughout Australia, particularly in the capital cities. I stress that private business cannot be carried on successfully without an efficient mail service. For many years chambers of manufactures and employers’ organizations have requested successive governments to increase the efficiency of the Postal Department. During the period that I was associated with that department, its constant aim was to provide a completely efficient service to the business community. Evidently this Government does not realize the importance of the maintenance of efficient postal services. The honorable member for Banks (Mr. Costa) has referred to the shortage of telegraphists in Sydney. “What he has said is applicable equally to other capital cities in this country. If honorable members noted the times that telegrams delivered to them were lodged it would be apparent to them that there must be a vast shortage of telegraph staff. I have noticed that telegrams are not delivered nearly so quickly in these days as they were formerly.

Mr SPEAKER:

– Order ! The honorable member should not embark upon a lengthy discussion about the Postal Department.

Mr BRYSON:

– I consider that the dismisal of about 4,000 postal employees is a retrograde step, which will have a tremendous effect on production in this country. The department must become hopelessly inefficient as a result, and production will be retarded rather than increased. Although I do not claim that redundant officers should be retained in the government service, I know it to be a fact that the work of the Postal

Department has increased enormously. As business and commercial undertakings expand, additional postal services should be provided by the Government. I consider that the indiscriminate sacking of employees of this great public utility will result in inefficiency and make the work of private industry more onerous. It is evident that, in ordering the sacking of 10,000 public servants, the Government did not consider what would be the effect on the Public Service generally. Supporters of the Government merely thought “ This will make a good window display for us ; we shall show that we are honouring our promise to the community to reduce the Public Service”. I challenge the VicePresident of the Executive Council (Mr. Eric J. Harrison) to deny that- after 10,000 public servants have been dismissed the Public Service will not still be larger than it was when this Government took office. Obviously honorable members opposite are prepared to disregard efficiency, and are at pains to convince the people of this country that the dismissals are an anti-inflation measure. They are endeavouring to blind the people to the reality of the position. I consider that it is time the people were told that this sacking of public servants is the result of an arbitrary action, which has been ordered without any consideration of the staffing needs of the various departments. I know that when the Government instructed the Public Service Board to dismiss 30,000 public servants, the board told the Government that it would be impossible to maintain efficiency if the order were carried out. In effect, the Government said “ Never mind about having an efficient Public Service “. We must sack 10,000 public servants and make a brave show for the public. The Government did not ask the Public Service Board to report from which departments staff should be retrenched. I believe that its approach to the matter was, that as 10,000 is approximately 5 per cent, of the numerical strength of the Public Service, 5 per cent, of the staff of each department should be sacked.

I have already referred to the inevitable effects of the sacking of 5 per cent., or 4,000 employees of the Postal Department. But let us consider what will be the effect of the dismissal of 5 per cent, of the staff of the Taxation Branch, which handles the great bulk of Commonwealth revenue. When the Treasurer (Sir Arthur Fadden) introduced the simplified taxation return forms he announced that henceforth assessments would be issued much quicker than hitherto, and that taxpayers entitled to refunds would obtain them expeditiously. I am still waiting for my assessment and refund in respect of the financial year 1950-51. Many of the lower-paid officers of the Taxation Branch in Melbourne who have been working overtime continuously in order to complete this work, have been dismissed. Inevitably unnecessary delay will now be occasioned. It cannot be denied that the remaining members of the staff will have to work considerably more overtime, and that taxpayers will have to wait longer for their assessments and refunds. If supporters of the Government have any sense of responsibility to the people of this country they will reconsider this matter, countermand the dismissal notices, and examine the Public Service with a view to attaining the utmost efficiency. When Labour was in office, honorable members opposite continually advocated that preference in employment in the Public Service should be granted to ex-servicemen, and they made certain promises to the people in that connexion. Let them now honour those promises.

Debate (on motion by Mr. Dean) adjourned.

Sitting suspended from 6 to 8 p.m..

page 207

DEFENCE FORCES RETIREMENT BENEFITS BILL 1951

Motion (by Mr. McBride) agreed to -

That leave be given to bring in a bill for an act to amend the Defence Forces Retirement Benefits Act 1948-1.950, and for other purposes.

page 207

COMMONWEALTH EMPLOYEES’ COMPENSATION BILL 1951

Motion (by Sir Arthur Fadden) agreed to -

That leave be given to bring in a bill for an act to amend the Commonwealth Employees’ Compensation Act 1930-1950, and for other purposes.

page 207

SUPERANNUATION BILL 1951

Motion (by Sir Arthur Fadden) agreed to -

That leave be given to bring in a bill for an act to amend the Superannuation Act 1922-1950, and for other purposes.

page 207

SUSPENSION OF STANDING ORDERS

Motion (by Mr. Eric J. Harrison) - by leave - agreed to.

That so much of the Standing Orders bo suspended as would prevent the Leader of the Opposition (Dr. Evatt) from making his speech in Committee of Supply on the budget without limitation of time.

page 207

QUESTION

BUDGET 1951-52

In Committee of Supply: Consideration resumed from the 26th September (vide page 86), on motion by Sir Arthur Fadden) -

That the first item in the Estimates, under Division No. 1 - The Senate - namely, “ Salaries and Allowances, £ 10,400”, be agreed to.

Dr EVATT:
Leader of the Opposition · Barton

– I am much obliged to the committee for its permission to me to speak without limitation of time. I regard this budget as one that is of tremendous importance to the people of Australia. It has established a record in regard to magnitude. It demands the most careful and analytical treatment by the committee. Honorable members on this side of the chamber certainly will give it great attention and proceed to criticism of it. In my view, its tremendous importance is paralleled by the tremendous burdens that it will cast upon the Australian people. I shall endeavour to establish that those burdens are unnecessary and that the basis of the budget, having regard to the present economic and financial position of this country, is completely fallacious.

The Treasurer (Sir Arthur Fadden), in his budget speech, endeavoured to give the impression that the present inflation is largely outside the control of governments and that it has characterized the whole of the post- war period. I suggest that that is far from the truth of the matter. In September, 1949, just before the late Mr. Chifley delivered his last budget speech, he, as Treasurer, reported to the Parliament and to the country a great improvement of the national finances. Subsequently he introduced legislation that provided for very substantial tax reductions. They were the fifth series of tax reductions that were effected during the life of the Chifley Government. That Government handed to its successors, the present Government, a sound national economy and a treasury and budgetary position that substantially protected the stability of Australia. That claim is borne out by the evidence of the prices indices, the state of the Commonwealth loan market and the healthy position of major works projects. It is true that price increases occurred during the period of office of the Chifley Government, but they were due primarily to the increasing impact upon Australia of overseas influences. By and large, the position in Australia at that time was one of relative stability. We had a good record as a nation. It was a record that was singled out by economists of note throughout the world as being a credit to all concerned in the government of the country.

Then the present Government came into power, pledged to check inflation and increase the value of the fi. There can be no dispute that after it assumed office in December, 1949, there was a long period of inaction. The Government parties dislike federal prices control, capital issues control, and the system of subsidizing basic commodities. From December, 1949, until comparatively recently, the policy of the Government was substantially one of inaction. That was a fair policy from its point of view. It thought the economy would right itself, and it acted accordingly. Last year, the Government’s policy was to let things go, but that only increased the inflationary spiral. This year, the Government has adopted, one after another, measures that it had previously rejected. The final reversal of form is the present budget. During the general election campaign of 1949 the present Government parties used the catch-.cry that they would restore value to the Chifley £1. That promise should never have been made, because itwas impossible of performance. The value of the Chifley £1 was much greater than that of the fi to-day. This budget is out of keeping with the accepted policy of the Labour party under Mr. Chifley - a policy of full employment. After the war, we had a period of expansion and progress, but the indications now are that we are entering into a period of retrenchment and contraction.

I shall refer to several important matters of a factual nature. The budget makes provision for a declared surplus of £114,000,000, the object of which is to draw off surplus spending power ; but the true surplus will be much greater than that, because there are a number of hidden surpluses to be found in transfers to various accounts and in possible underestimates of income. I shall not go into the details of those, for they will be dealt with by my colleagues. In considering the declared and open surplus, we must look at other factors, including the appropriations for strategic stores and equipment. One of the features of last year was the failure of the Department of Supply to expend the very large sum that had been allocated to it for the purpose of accumulating a reserve of strategic materials. I shall refer to that matter later. The surplus that I have calculated by way of illustration is not £114,000,000 but £220,000,000, but I think the true figure is between £220,000,000 and £250,000,000 over and above the figure specified by way of appropriation in the budget.

There are already signs in external markets of substantial price reductions. Wool is a notable example, although it is true that the price of wool varies greatly. The Treasurer has noted those facts, but has dismissed them as being of little consequence. We on this side of the committee regard them as reasons for acting with great caution. A decline in wool prices, at any rate, preceded the great depression of the 1930’s. I do not say that conditions to-day are comparable with those of the depression, but undoubtedly the position is that overseas influences may exert a strong deflationary effect during the current year, apart altogether from the effect of this budget. Yet the Treasurer has rushed in with a budget, the professed intention of which is deflationary. It has been said said that this budget is intended to bring prices down, but it sets about doing so by ensuring that prices will rise, over a very large range of goods because of increased sales tax and excise. In addition, the carrying through of the proposed increased company taxes will affect the whole cost price structure. The basic wage will have to be increased as a consequence. The theory apparently is that in order to bring prices down they must first be increased. It is not an easy theory to understand unless one has some specialized knowledge.

This budget rejects prices control, although that is an important influence in limiting excessive profit margins. If, as the Treasurer argued in his budget speech, inflation is predominantly of local and not of overseas origin, it should be most important to control profit margins. But whether the inflation is local or external, the result will be the same. The budget very conveniently omits reference te the fact that in both the United States of America and the United Kingdom prices control operates.

With the exception of tea and coal, the budget does not offer any means of preventing variations of external prices from getting caught up and becoming embodied in the domestic prices structure, so that if overseas prices increase, whether it be of goods we import or of those we export, our costs and prices must also move upwards. Further, by implication the Treasurer’s speech assumed that an increased flow of imports will help us substantially with our local problems. Yet, the budget sets about cutting down expenditure by public authorities, which are responsible for a very large part of the imports into this country of basic capital equipment and materials. It must follow that the importation of prefabricated houses, steel, and plant and equipment for electricity undertakings will be reduced. Is this to be regarded as an anti-inflationary measure and one which contributes to defence -and development?

I mention, again by way of introduction, the vital and crucial problem of employment, because, in the view of the Opposition, these budget proposals will have an immediate and adverse effect on employment. They are meant to have such an effect. We know that the dismissal of employees from the Public Service has taken place, that labour will bc transferred from construc tion programmes and that there will be displacement of labour in certain industries which produce goods that are to be subjected to very crippling sales tax. I think that the effect of this budget upon production is of tremendous importance. No doubt every one will agree that the real solution of the inflationary problem in Australia is increased production, but this budget does nothing whatever to tackle that positive aspect of the problem. It is essentially a negative and repressive budget. The rate of taxation is being increased beyond the point at which all initiative, all enterprise and all hope are most prejudicially affected. The result will be that this budget, whether on the indirect or direct taxation side, will strike a severe blow at the productive effort of the people.

I now come to the question of defence. The Australian Labour party is keenly interested in the defence provisions of the budget. Our party was the one to which the people of Australia turned during the supreme crisis of World War II. and it was a Labour government which carried through Australia’s war effort to a successful and creditable conclusion.

Government members interjecting,

Dr EVATT:

– No one can deny the truth of that statement. That the people of Australia know that it is true was proved beyond all doubt at the general election of 1943. Having caused the anticipated interjections, I wish to say that the provisions for defence contained in the budget are extremely meagre, in view of the persistent Government propaganda concerning defence preparations. Too much attention has been paid to the more direct defence requirements. We must also recognize the importance of the major industrial and developmental projects of Australia, which was a matter emphasized by the late Mr. Chifley. It has been proved that it is impossible to get anywhere with the defence of a country such as Australia without the development of secondary industries and great national projects. This Government will be forced to accept that view before very long. In my opinion it is impossible for the estimated expenditure on strategic stores, to which I have already referred, to be made during 1951-52. I do not think that the amount to be provided can be ‘physically expended, nor do I think that the organization exists to warrant its expenditure. The fact is that only £9,000,000 of an allocation of £57,000,000 was expended on defence stores during the last financial year. Honorable members will remember the attempts of the Department of Supply to obtain rubber. It waited for opportunities, missed the bus and did not obtain the necessary rubber. The fact that only £9,000,000 of an allocation of £57,000,000 was expended speaks for itself.

Having regard to the increased cost of living, the pension and repatriation provisions contained in the budget, though undoubtedly welcome, are inadequate. In 1950, the pension rate for a single age or invalid pensioner was 36 per cent. of the then ruling basic wage. Including the latest proposed increase, the new rate will be approximately 31 per cent. of the basic wage, and because of the increase of prices and wages which is certain to follow, because the budget actually provides for it by way of tremendous increases of indirect taxation, the position of pensioners in terms of real money will become progressively worse. It should not be too much to ask that out of this astronomical surplus a further 5s. or even 10s. a week should be paid to such persons. Such a payment is not beyond the capacity of the National Welfare Fund, having regard to its existing balance.

I now wish to refer to the question of subsidies. This budget rejects the idea of subsidies on basic commodities, in flat contradiction of the policy promises of members of the present Government made in November, 1949. Subsidy then was the remedy upon which they seized. They said, in effect, “ We will reduce the cost of living and put more value into the £1. Why has Mr. Chifley taken off certain subsidies? Put us in office and we will restore subsidies “. If honorable members examine the list contained in the schedule they will see that subsidies are gradually disappearing. In line with the depression psychology of the Government, the budget declares for a cut in the volume of resources devoted to capital works. Although the figures are approxi mately the same as they were last year, the reality of the matter is that because of increased prices less capital works and services will be provided with a corresponding detrimental effect on development and living standards. The amount to be expended on the construction of war service homes, which are vital to exservicemen, will bc approximately the same in financial terms, but physically that activity will be curtailed. So will the services of the Postmaster-General’s Department. That is the policy of restriction and recession that was adopted by the Loan Council.

To turn now to the subject of the revenue collections, I point out that the tax provisions are regressive and do not fall with approprate weight on higher incomes, whilst sales tax and excise strike at the whole basis of our standard of living, because they reduce the income of the people just as surely as direct income tax does, and fall most heavily upon those least able to bear the burden. There is no reason for the imposition of stiff rates of sales tax on the products of certain industries. Why the Treasurer selected toy-making, ice-cream-making and the musical instrument manufacturing industries for increased sales tax I do not know. But I know that formerly he did not believe in heavy sales tax and I doubt whether he believes in it now. The sales tax on the products of these industries can make no contribution to counterinflation. Toys and ice-cream will still be bought, and all that will happen will be that certain sections of the community will be penalized.

The wool tax provisions will continue discrimination, but in a slightly different form.. The wool-growers will get ba,ck the £45,000,000 which was collected as a starting point in the wool stabilization scheme. But provision for the refund of that money was made in the Chifley Government’s legislation, which provided that if the scheme was not approved by the wool-growers the money collected had to be returned. But whilst this Government is handing back £45,000,000 to the wool-growers modification of the system of averaging incomes will bring it in another £47,000,000 from, the same source. So if may be said that “Fadden gives and Fadden’ takes away”, but Fadden always takes away a little more than he gives.

There is no guarantee that the public will react in the way that the budget appears to assume. Sales tax, for instance, may not, and probably, will not, deter people from purchasing goods on which such tax is to be increased or imposed. The extra taxes may only mean that people will cut down on savings. The paper tabled by the Treasurer in relation to the national income shows that the percentage of national income received by wage and salary earners in 1948-49 was 54.4, but it had fallen in 1950-51 to 48.2. So wage increases are merely chasing prices, and the relative standard of living is declining.

I say that the fair conclusion to make about this budget is that it is part of the blueprint of the Treasurer, or of those advising him, for a recession which can easily be converted into a serious depression. It represents a direct attack on the standard of living of all sections of the community. Every aspect of the national life will be affected by it. There will be f urther centralization and control of money, employment, industry and business. In time of actual war, or imminent danger of war, the Australian people are ready to make any sacrifice, but, on fair analysis, as the figures will substantiate, this budget cannot be regarded as primarily directed to any actual or alleged defence emergency. It is the responsibility of the Parliament to prevent reckless experimentation with our economy. When I say that, I mean that it is a responsibility of every member of the Parliament to do so. In my view, approval of the budget will imperil the national credit of Australia, which has fallen to the lowest ebb, as witness the failure of the recent security loan. That is an undoubted, regrettable and tragic fact.

I understand that rank and file members of the Government parties were consulted about the Government’s plans only after the budget had been delivered, and I should imagine that some of them, at least, must be appalled by it. If they vote for the budget they will become parties to the repudiation of the pledges om which they were elected. Such repudiation is involved in this budget. What did they promise the electors? They promised to reduce taxes, to maintain full employment, to put more value back into the £1, to increase production, to eliminate the scarcity of all consumer goods and to maintain and even extend subsidies on basic commodities. But the budget repudiates all these pledges. I do not think that any one supposes that the actual verbiage of much of the budget is that of the Treasurer himself, because for many years, in the most blunt and vigorous language, he denounced the Labour Government and maintained that even the five reductions of taxes that the Labour Government made were inadequate. Invariably, he demanded further reductions. But let us see what the new economic policy of the Government and the Treasurer really is. In his budget speech the right honorable gentleman said -

After the war, as controls were eased, there bega.n a great thrust to expand in all directions. Protected from competition by overseas shortages and levels of costs and with a market that seemed limitless, industry set out to produce any and every kind of article that would sell. Existing factories were extended and flocks of new ventures were attempted. Public authorities joined in the effort to expand with a thousand and one projects for transport, water and power supply, postal and telephone services, housing, schools and hospitals. Many of these, of course, had been deferred through the long war period a:nd existing facilities were far behind requirements.

It is true that Australian industry rapidly expanded to make up for war shortages and the decline of capital equipment. That process was encouraged by the Chifley Government’s policy. We handed over war-time government factories to private enterprise and kept prices and profiteering in reasonable check. The first great set back to that policy occurred in 1948 when those in charge of the present Government combined to defeat the prices referendum. The pre-existing situation cannot now be recaptured by the Government and I think that that possibly lies at the root of the Government’s difficulties. Nobody supposes that national prices control can of itself halt inflation, but it was a valuable and essential check and the abandonment of it on a national scale is part of the heavy responsibility of the Treasurer and those associated with him.

But what does he say now about the restrictions and controls that he so often denounced when the Chifley Government was in office. He says - it has to be recognized that the time has come to impose effective restraints on money demand for goods and on the indiscriminate production of less essential goods.

Mr Hasluck:

– Hear, hear !

Dr EVATT:

– That is the policy expressed in the budget. I am glad to hear the applause. Of course, this is the theory that underlies the Defence Preparations Act. A few people are to decide in time of peace upon °an order of priorities. The object of the Government is either openly and directly to destroy what it terms “less essential “ industry, or indirectly to starve out such industry on the say-so of an official who may be quite out of touch with the facts of the industry. The Government hopes that somehow or other its policy will work out. and that against those engaged in “ less essential “ industry who are injured or ruined in the process there can be balanced others who are more deserving and who will be rewarded. “ Somehow or other “ is the correct phrase. That is a fallacy. It will not happen that way. It has never happened that way, and we cannot assume that it will do so now. Therefore, with that in mind, I call this budget the “ somehow-or-other “ budget. It would be naive to assume that the Treasurer has forgotten all his election promises, and that he has embarked on a wild scheme to stockpile all of the people’s money on which he can lay his hands. The matter goes much deeper than that. In my opinion this is not a Fadden budget, except insofar as the Treasurer is the instrument through which the plan has been executed. It runs counter to nearly everything the Treasurer has stood for in public life. The fact is that the Treasurer, through this budget is injuring the graziers, tha farmers, the country traders and the rural section of the community just as much as other sections.

I propose now to examine three important propositions contained in the budget speech. The first of these is -

By co-ordinated financial action agreat deal can be done, both generally and in particular directions, to check the growth of consumption demand for goods and investment demand for resources. The Government and. its various agencies have already instituted some powerful measures in this field and these are being made progressively more effective.

By that statement, the Treasurer means that there has been very rigid application by the central bank, with his approval, of the policy of credit restriction. An important new policy was laid down in November of last year, and the administration of that policy has become more and more severe. Instructions were issued on that date - I do not know whether any further instructions have been issued since - that credit must be restricted. That was the first step in a movement which, if not controlled, must lead to recession, and will probably lead to depression.

I come now to the Treasurer’s second proposition, which is very different from what he used to argue with great vigour and skill. Again I quote from the budget speech, and I ask honorable members to note the tentative approach -

It is quite certain that if resources were concentrated on fewer jobs - those of a really essential kind - a greater volume of work would be completed and the economy as a whole would be better for it.

As a general proposition that might seem to be correct, but it raises a question which requires careful analysis and working out. That, however, would be too troublesome for the Treasurer, because the f allacious steps in the reasoning would then be exposed. For his purpose it is best to dogmatize. Hence the phrase “ it is quite certain “. In my opinion, it is not only uncertain but very doubtful whether the alleged result would follow. As every one with practical experience knows, the result would depend upon the type of works and their situation, the relevant geographical position of the employees, and the technical rhythm of each project. The abandonment of project “ A “ might not result in the acceleration of project “ B “. Indeed, war-time experience showed that the hoped for result did not always follow. The bold assumption of the Treasurer that centralization and physical concentration are always more efficient than decentralization and dispersion is very disputable. However, if the experts say so it is very difficult for mere politicians to disprove it. That is why the phase “ It is quite certain “ was used. It may he true, but it may not be.

I come now to the third and boldest assertion of the Treasurer. It is stated as follows : -

The Government believes firmly that under the “present highly inflationary conditions total receipts should do more than cover total expenditure - they should be sufficient also to provide a substantial surplus. Modern thought on the’ relation of public finance to -economic stability is quite clear on the point that in times of depressed trade and unemployment governments* may justifiably run into deficit and even finance some part of their needs with central bank credit, so raising the level of community spending power.

That is the first part of the statement, and ‘ we do not disagree with it. Here we have the experts or planners claiming that, in certain circumstances, central bank credit can and should be used to raise the level of purchasing power. Of course, this carefully guarded proposition put in that form is true - so true that it is a truism. But during the depression of the ‘thirties the same thesis was denounced by nearly every economic and financial expert, as well as by those politicians who prevented the Labour Government from obtaining sufficient bank credit to put the Australian unemployed to work on necessary undertakings. I am pleased to note this retraction in the budget. I have little doubt that what I now call a truism was hotly disputed by many of those who shared responsibility for the statement in the budget speech. But let that pass. That is the first part of the statement, and I now come to the second, which is -

It is a vital corollary of this view, however, that, in times of excessive demand and scarcity of labour, governments should draw away from the public in taxation and loans more than they spend for current purposes.

I strongly dispute that proposition. The Treasurer mentioned “ modern thought “, hut he does not say whose thought. It seems to be a very convenient form of anonymous self -description. This alleged vital corollary, which is of great importance to the people of Australia, has been put forward as axiomatic, something that cannot be disputed. The alleged vital corollary is that the present Government should “ draw away from the public in taxation and loans more than they spend for current purposes “. “ Draw away “ is a nice phrase; it sounds like something that Wed Kelly might do. The committee will note the studied ambiguity of the phrase “ more than they spend “. How much more? It might be only a. trifle, or it might be a great deal more. The Government, accepting this questionable theory, proposes to draw away - that is, to expropriate - a large part of the purchasing power of the people. The purpose is openly stated, and around the statement and that purpose there should be keen debate in this committee. The purpose is to put the people’s money “ where it can do least harm “.

That is the crucial point of the budget speech. The Government is to take more and more of the people’s money, both directly by income tax, and indirectly through excise and sales tax. The Government has also changed the incidences of taxation in order to hold on to money which should be refunded to some sections of primary producers. It has openly repudiated the arrangement under which businesses obtained tax concessions by the system of initial depreciation allowance initiated by Mr. Chifley. In the result, taxation revenue will reach a total of £957,000,000, a tremendous and unprecedented and quite unjustifiable total. It has been estimated that the total amount of revenue collected- will be £1,041,000,000. The disclosed budget surplus has been estimated at £114,000,000, although, in truth, it will be much larger. The failure to disclose this fact calls for strong condemnation. It is admitted that out of an additional £215,000,000 only £33,000,000 will be used for defence purposes. That is less than 15 per cent, of the increase which destroys the notion that this is a defence budget. It is not certain that this £33,000,000 will be spent. After considering last year’s example of the Department of Supply, it seems to me that the difficulty connected with getting the technical processes to work in respect to war contracts will probably prevent that amount from being spent during the coming twelve months. It will not be spent any more than the Minister for Supply (Mr. Beale) spent his allocation for strategic materials, such as rubber, last year. On that occasion the Minister missed the bus, and he will probably do so again.

The Government’s policy is to drain off or “ draw away “ the people’s money, not for the purpose of ordinary constitutional appropriation for specified objects, but to “ put it for the time being where it can do least harm “. It is to be taken out of the people’s pocket and put into the pocket of the Treasurer. The Government’s policy is to keep money that belongs to all sections of the people from doing harm by taking it away from them, not to spend on a specific purpose, but to prevent them from spending it.

I do not regard the “vital corollary” as a logical consequence of the main proposition, and I certainly do not regard it as proved in application to the present circumstances in Australia. Australia’s economy bears little resemblance to those of most other countries. It is true that in times of depression there is every justification for expanding bank credit but we are not now dealing with matters which belong to the same order of thought. It might as well be argued that because a motor car has to be fed with some petrol to make it go, a car which is travelling too fast can be slowed down merely by taking some petrol away from it. In fact, it may make no difference at all. It depends upon other circumstances. Who laid down the economic laws to which the Treasurer referred I do not know. It was not the Treasurer. Prom my recollection of what be said two years ago I should imagine that he would consider the type of proposition that he has now put forward to be unsound. This brings me to what I regard as a basic fallacy of this budget, lt completely disregards the natural and legitimate feelings and the hopes and aspirations of the average Australian family. If people are arbitrarily deprived of the fruits of their labour and enterprise, it must interfere with their reasonable hopes and ambitions and the result will be a completely frustrated people. It is certain that a budget such as this is must have a detrimental effect on every phase of the economy. It is a complete discouragement to initiative. Members of the Gover.nir.ient have said a great deal concerning incentive, yet they are now proposing to cut off incentive at its source. There is little hope of improving production under a budget which hits so hard and widely and ferociously as does this one, not for the specified appropriation purposes of government under the Constitution, but for the simple purpose of preventing the people from having money.

Because the budget totally differs from the views to which the Treasurer used to be wedded it is clear to me that it has been largely inspired by advisers who have no political responsibility and who have completely misunderstood the mood and temper of the people of this country. I believe the budget has been inspired by experts who have set on one side the natural desires of the people for life, liberty and the pursuit of happiness in a free democracy. The people are quite willing to make every sacrifice necessary to maintain the integrity of Australia as a British nation, but they are not willing to go along with this Government in its present dangerous experiments. If a mistake is made it will not affect the advisers. The result will have to be measured in terms of the unemployment and suffering of hundreds of thousands of our people. It is absolutely wrong to assume that if a less essential industry is curtailed employers or employees will find their way to more essential employment or, indeed, to any employment. There will be further dismissals and great losses to many industries.

I think that attention should be paid to the part that was played by Sir Douglas Copland in the development of the Government’s policy. The distinguished professor is often the spearhead of the experimentalists and he is a very prominent figure - I was going to say “ in economic affairs “, but I prefer to say “ in politico-economic affairs “. The present policy of the Government, in crucial respects, has been governed or strongly influenced by the Copland policy as it has evolved since Professor Copland’s return from China in 1948 up to the present day. He was one of the first to insist upon discriminatory action against the wool-growers. In one respect, at least, which I have mentioned, this discrimination is continued in the budget. In July, 1950, Professor Copland advocated the denial of the right to claim depreciation allowance for income tax purpose notwithstanding the undertaking to industry which had been given by Mr. Chifley and which was1 then embodied in statute law. That law is effective until the end of 1952, but that promise has been repudiated. That action is in accordance with the advocacy of Professor Copland. In 1948, Sir Douglas Copland saw fit to characterize the Australian economy as a “milk bar” economy. He intended by that odd expression to indicate a lack of balance between essential and nonessential industry. On that point his views were in direct collision with the Chifley Government’s policy of developing Australian projects and industries, not only for their own value, but also for the future defence of Australia. The Defence Preparations Act and the budget both embody that thesis. Under the act, the Government could directly terminate certain industries or contract them. Apparently, it prefers to use the indirect method that has been adopted in the budget. But it is the Copland thesis that less essential industries must be removed or restricted.

Professor Copland’s writings show that he favours extending the 40-hour week to 44 hours and that he regards with misgivings the doctrine of full employment with which the name of Mr. Chifley is associated. He recently praised the Government’s dismissal of 10,000 public servants. .Full employment is threatened by this budget. If the policy of the budget in this respect is adopted there will be a grave danger of returning to the pool of unemployment which is discreetly favoured by a number of economists. Last March, Professor Copland read a paper which he called “ A Comprehensive Plan for the Control of Inflation “. Since he called it a “ plan “ himself, I suppose that we may call it the “ Copland plan “. He summed up his plan in the following eight points: - (!) A national development and defence levy ;

  1. A levy on the gross income from highpriced exports;
  2. A general increase in company tax, on a percentage basis and applicable to all companies;
  3. A rise in the rate of interest and restriction of time payment and hire purchase systems ; [5) The progressive development of a free exchange combined with the elimination of controls on exchange transactions and imports from hard currency areas;
  4. Budgeting for a surplus by means of the measures suggested above, together with higher sales tax and excise on luxury goods;
  5. A national drive to raise the level of productivity, especial.y in basic industries, together with additional efforts to obtain imports of essential materials and capital equipment. In view of the low level of production a resumption of a universal 44-hour week would give immediate relief;
  6. Depending on the trend of overseas prices, resumption of price control in an effective form, with subsidies on high-priced imports and exportable goods as developed during the war.

The Copland plan was announced before the general election in April. A close study of the eight points will show that the Government has made considerable use of the plan. Presumably the Government considered the Copland proposals in March last. If so, it failed to indicate to the people before the general election where it stood in regard to them. The double dissolution took place on the nominal issue of a dispute about the Commonwealth Bank Bill. Ministers must have known that the Government would be defeated if they disclosed to the people prospective increases of taxation, a sharp rise in the rate of interest involving tremendous loss to bona fide holders of war-time securities and Commonwealth bonds, restriction of the time payment system, an open threat to the shorter working week, and above all the deliberate intention to budget for a huge surplus.

It is perfectly true that not all of the Copland plan has yet been accepted by the Government. Some parts of it may never be accepted; but in principle it has been accepted. It may be said that it is being accepted on the instalment system. Some of the instalments are now being delivered. Many hints were given by Ministers about the nature of the budget. Those who attended the inflation conference in Sydney heard some of them. Later, one Minister said that the Government was prescribing bitter medicine for the people. Bitter medicine must be given dose by dose, and that is how it is being administered. We now can see that essential features of the Copland plan are being adopted by the Government. We are witnessing a substantial increase of taxes, not for normal appropriation purposes, but for the purpose of draining away money from people who, it is suggested, cannot be trusted with it. The proposed rise in the rate of interest has already taken place, and I gather from proposals that have been mooted that the rate will go still higher. The restriction of time payment and hire purchase systems i3 already operating. A frontal attack is being made on all sections of the nation. The effects of the first instalment of the Copland plan are already in evidence. In less than six months from the first application of pressure through credit restriction business and employment are being prejudiced and threatened throughout the land.

The Minister for Labour and National Service (Mr. Holt) talks glibly about the numbers in his books, but the figures are out of date when they are issued. Mass dismissals instituted by this Government have led to similar dismissals in Victoria as a direct result of Commonwealth economic policy. The key industry is always the building industry. Credit restrictions have stopped advances to co-operative home-building societies. The banks have reduced advances and tens of thousands of people are being adversely affected. The credit restriction policy has also hit many large retail establishments. The banks have reduced the period of accommodation for meeting payments on new shipments of stocks and purchases must now be financed long before they are actually to hand. That policy has compelled traders to unload stock solely to meet commitments. But what will be the position when stock has to be renewed? The Government has set in motion the machinery to give effect to point 4 of the Copland plan which provided for increases in the rate of interest and restriction of the hire purchase and time payment systems. Professor Copland regarded these plans as complementary, as they are. Pressure is now being applied to the time-payment houses by the banks and through government propaganda. The new conditions apply particularly to motor cars, motor trucks, and farm equipment, and many struggling businessmen urgently in need of new equipment are being hindered by them.

The policy of the Government also hits industries that supply home appliances, such as refrigerators, radio sets and vacuum cleaners. Apparently the Government’s advisers regard these appliances as unnecessary luxuries. On the contrary they are becoming and should remain normal amenities of the people. The increase in the rate of interest has meant higher payment by home purchasers, heavier costs to State governments and a general all-round hardening of finance. Prom the very day on which the Government was returned to power in April last an atmosphere of business doubt, frustration and financial hysteria has been created. Much of it has stemmed from fear of the Copland plan. Business men could no longer plan with certainty about the future. No industry knew where it was going. Professor Copland seems to be able to express the thoughts of the Government before the Government has made up its own mind. The irony of it all is that the Government talked of war and defence preparations, but it was unable to divert to war activities industry which had been terminated. When businessmen went to the departments to seek contracts to replace lost markets for consumer goods they found the departments in a muddle. The departments were not ready to make contracts for services or the supply of equipment. I understand that probably at least twelve months will elapse before such contracts will be made. All of these factors culminated in the decline of the public credit of the Commonwealth and in the failure of the thirteenth security loan only a few weeks ago. But still the Government went on. Its next move was to embark on the wholesale and irresponsible dismissal of 10,000 public servants. No one can understand why that number was selected apart from the fact that it seemed a nice round figure. That was a wasteful and extravagant move which bore no relation to sound economic policy. It has helped to establish a trend towards recession and depression.

The Copland plan was still not fully implemented. This budget is the next critical stage of the plan. The central purpose of the plan is clearly to achieve a complete dictatorship over the national income and what might be termed a stockpiling of the people’s money in the hands of the Treasury without the slightest relation to the estimated or proved needs of the Government. Perhaps the most vital point of the Copland plan was the budgeting for a surplus, together with higher sales tax and excise on so-called less essential goods. The Government has accepted the Copland advice and it is nothing to the point that that advice was given publicly. We have now reached the stage where goods of the type I have mentioned are regarded as less essential. In the view of the Government those industries which manufacture refrigerators and other home equipment are engaged in activities that are detrimental to the economy of the Commonwealth. They will be caught up in the national heresy hunt. No wonder Sir Douglas Copland rushed to the Australian Broadcasting Commission last Thursday and hailed the budget in these terms: -

The 1951 Budget is a landmark in Australian finance. For the first time a Treasurer has deliberately increased taxation to produce a budget surplus, and it is a real surplus, even to the extent of financing about £100,000,000 capital expenditure from revenue.

Professor Copland, however, does not think that it is to be merely £114,000,000. He also said -

The Budget surplus is more than 10 per cent, of total taxation and is certainly deflationary in incidence.

That is certainly a serious understatement. Not only is the surplus deflationary in incidence but it also indicates recession and depression. The purpose of all budgets that have previously been presented under our constitutional arrangements has been to provide for the legitimate requirements of the Government according to the Estimates. The present budget gives tangible and welcome assistance by way of repatriation benefits and increases in social services payments, but the increases are certainly not adequate to meet the greatly increased cost of living. I hope that the Government will make the benefits operate from the earliest possible date. The primary purpose of the budget is to withdraw money from its owners, change the ownership to the Government and place it at the absolute and uncontrolled discretion of the Treasurer. The attitude of the Government is that the people must not be trusted even to spend or save their own money.

The Government has practically abandoned the idea that these unprecedented levies are for the purpose of war and defence, yet it proposes to take from the people no less than one-third of the national income of Australia. The estimated national income is £3,100,000,000 and the Government is planning to take £1,041,000,000 from the people. That is how the Government is putting more value back into the £1; it is taking the pound. Its taxation levies will be twice those imposed by the Chifley Governnent. Even more serious is the new element introduced into the public finances of this country in that the tax instrument is proposed to be used solely to expropriate from the people a far greater share of their income than anything referable to legitimate government demands. The general effect of that proposition will be to set into motion forces making for a depression. A depression is not caused merely by financial and economic factors. Psychological factors also play a large part, and the anxiety caused by measures such as this will spread rapidly and tend to build up those psychological factors. Human anxiety as to the future will spread rapidly as the impositions are made recklessly and wantonly, without bona fide appropriation to specific public purposes as is contemplated by the spirit and perhaps also the letter of the Australian Constitution. That fear and panic which the Government has caused will spread rapidly among the people, and the purchasing value of the people’s money, will, in certain respects, be destroyed. Prom every £1 earned by the nation, the Government will grab 6s. Sd. Many Australians will, as a result of that action, be deprived of necessities, especially as most of the indirect taxation will be passed on to the public in the shape of - higher prices.

According to the budget the Government precisely balanced its expenditure during the last financial year. However, upon closer examination it is disclosed that considerable sums of money were passed into hidden reserves, the most notorious being the diversion into trust funds of £4S,000,000 on account of strategic stores and equipment reserves.

That sum was voted by Parliament but never spent. Instead of spending the appropriated sum3, the Government ended the financial year with a surplus of £S8,000,000 in ‘trust funds alone. If an ordinary taxpayer returned his income in the way in which the Treasury has presented this account to the Parliament, he would be fortunate if his name did not appear in the list of cases to be dealt with under the act as questionable returns. In fact, the Treasury collected from the. people far more than it actually required. Its real surplus for last year I would estimate as at least £150,000,000.

Now the rake-off is to be on a more grandiose scale. The admitted surplus revenue will be £114,000,000, but the real surplus will be enormously greater. Some people estimate that the true surplus for this year will be at least £250,000,000 above the actual or contemplated needs of government. It will certainly be not less than £220,000,000, as I have tried to demonstrate.

I sum up this matter by saying that the Government proposes to take from the people from £220,000,000 to £250,000,000 more than is required to meet the estimated needs of the Government. The sole reason for this enormous imposition is that the people’s money, while not needed for any specific lawful purpose, is being confiscated permanently and is being placed “ where it can do the least harm “. The dismissal of 10,000 public servants will save only about £5,000,000. The Government is hoarding an unnecessary £220,000,000 and is proposing to save a paltry £5,000,000 at the expense of those public servants and their families.

Here is a government, which in 1949 undertook to reduce taxation, now embarking on the highest taxation grab in Australian history. The highest taxation previously imposed was in 1944-45 during the war period ; it raised £353,000,000.

This year, the total taxation levy is to be £957,000,000. Certainly that is a very high price to pay for this Government. If this is how the Government manages the finances of the country in time of peace, what would it do in time of war? If it deliberately injures the people, threatens the machinery of production and weakens the people’s morale, adequate development and defence will become impossible. In my judgment, the new tax structure will tend to destroy the possibility of saving, and gravely impair the incentive to produce.

The story about sales tax is a sorry one. Let me quote two illuminating extracts from the present Treasurer’s speech made in 1948 during the debate on the last budget presented by Mr. Chifley -

Wo are told that Australian babies are the best immigrants, but even the smallest of these babies contributes his mite to the Treasurer’s swollen sales tax coffers. Every time a child gets a toy, a birthday party caj), sweets or an ice-cream, the Treasurer is there to take bis 2s. in the £1 on the transaction. These may not be regarded as strict necessities, but is there any parent who would allow his child to grow up through a toyless and partyless childhood, or without some indulgence in sweets or ice-cream? It is only those of us who have experienced the intense happiness that children get from the simple pleasures, who can appreciate the official niggardliness that taxes them so severely.

The Fadden levy will be 33£ per cent, on toys, and on ice-cream and sweets it will be 20 per cent. The Treasurer was equally grandiloquent on the subject of engagement rings. This is what he said -

The basis of the home life of Australia is the engagement ring. but. in his grasping way, the Treasurer has imposed a tax of 5s. in the fi oil these articles, the cost of which may average about £20. Consequently, young couples who become engaged commence their engagement by contributing £5 to the Treasury.

The sales tax rates on engagement rings under the new Fadden budget will be 66$ per cent. The 5s. in the £1 will be increased to 13s. 4d. Further comment is superfluous.

It is important to note that the Government is apparently bent on eliminating all subsidies progressively. The dairyfarmer will not be subsidized, despite the arguments and promises of the Treasurer, the Postmaster-General (Mr. Anthony) and the Minister for Commerce and Agriculture (Mr. McEwen). The Government has abandoned the dairy-farmer, just as it has abandoned the wool-grower. The big problem of butter subsidy has been left on the doorstep of the State Premiers, yet the Treasurer promised that if the State governments were in disagreement as to price, he would subsidize the industry. Again the Treasurer has repudiated his promises and he has been strongly denounced for his action by the Brisbane Telegraph.

Honorable members interjecting ,

Dr EVATT:

– I do not know why honorable members opposite laugh at the Brisbane Telegraph because it is certainly not a Labour journal. One effect of the budget may well be to force many people who hold government bonds to realize on those assets in order to meet budget commitments. The inevitable tendency will be to bring about a decline in current quotations on the market. The recent advice reported to have been given by a leading Melbourne share-broking firm to its clients clearly indicates the trend. Surely when the securities of the Commonwealth of Australia are regarded in such a light that a Commonwealth loan cannot be filled the position is serious enough for everybody to take note of it. The nation has been stirred by the budget. No section of the community has escaped. By persisting in following a pattern of planning towards depression through deflation the Government is destroying democratic principles because every one knows that the people of Australia are overwhelmingly against the budget. I challenge the Government to go back to the people on this issue and to submit the budget to a referendum. Otherwise, the budget should be withdrawn for complete revision. Had the coalition parties been honest with the people last April and told them what was in store for them in the budget, and that so large a part of the Copland depression plan was to be adopted, they would have been defeated if not annihilated. As soon as the Treasurer’s budget speech was delivered, practical men representing employers and employees, primary producers and manufacturers, were almost unanimous in their condemnation of the injustices, the stupidity, and the folly of the budget and the adverse effects it will have on industry, business, and all employment. Hardly a representative business man can be found who is pre.pared to endorse the methods that thin budget proposes should be adopted. I hope that honorable members on the Government side will express their frank opinions about it. The Government, by its actual and proposed financial and economic plans is undermining the industrial and commercial basis of Australia’s prosperity, but, most sinister of all, the Government threatens the true constitutional basis of public finance which is specific appropriations. It is time for us to take stock of the position and to approach the economic and financial problems of the nation in a hard, practical, common-sense way instead of experimenting with untried and dangerous economic theories advocated by some individuals who have blundered badly in the past. It is time to try to restore confidence in the future of our country. Professor Sir Douglas Copland, in his broadcast last Thursday night, almost adopted the pose “ Alone I did it “. I mention Sir Douglas Copland because he seems to be the only supporter of the budget who can be found in Australia. It is true that the Government’s plan is not 100 per cent. Copland; but is not yet 100 per cent, complete. When Sir Douglas Copland praises the plan, he praises what is largely his own plan,’ publicly announced as such by himself; hut it is for this Parliament and not the Government or its advisers, official or unofficial, inside or outside the political arena to accept final responsibility. By compelling a revision of the budget, the Parliament would save the people from the dangers of avoidable recession and depression. The object of the Opposition is to force a revision of the budget insofar as it imposes taxes, levies, and duties. That is essential in the national interest, and that is why I move, on behalf of the Labour party.

That the first item he red need by £1.

Mr HOLT:
Minister for Labour and National Service and Minister for Immigration · LP

– The committee indulged the Leader of the Opposition (Dr. Evatt) with an unlimited extension of time, but I am certain that even his most ardent admirer will be forced to admit that the time was not very profitably spent. About one-third of it was devoted to a one-sided debate with Sir Douglas Copland. It is rather surprising that the Leader of the Opposition should have taken up so much of the time of this committee in dealing with what Sir Douglas Copland said, particularly in view of the fact that the right honorable gentleman did not avail himself of the opportunity that was offered to him to debate the budget publicly with Sir Douglas Copland. Unfortunately, I shall not have the 75 minutes that we granted to the Leader of the Opposition to speak on the budget. I shall have only a short half-hour, and therefore, I shall concentrate on what appeared to be the leading points of the right honorable gentleman’s discursive speech.

I shall say .something at the outset about defence. It is true that defence items figure prominently in the budget. Later, of course, we shall have an opportunity to deal with those items in more detail. I should not have raised the matter to-night but for the extraordinarily impudent and despicable claim by the Leader of the Opposition that the people of Australia had turned to his party to defend them in time of war. This brazen and wicked assertion has been made from time to time. It was never made, I am happy to recollect, by the gentleman who distinguished himself by the leadership he gave to Australia in those years - John Curtin. In fact, records show that Mr. Curtin paid a tribute to his predecessors and the action they took to build up the defences of this country, but to-day we listen to men such as the honorable member for East Sydney (Mr. Ward), who, in the last pre-war financial year, attacked the then Government because it had introduced what he described as a “ warmongering budget “. These are the men who resisted the enlistment of the Australian Imperial Force and endeavoured to refuse authority for Australian participation in the Empire air training scheme, under which men of the Royal Australian Air Force were trained for service overseas. These are the men-

Opposition members interjecting,

The CHAIRMAN (Mr. Adermann).Order ! Honorable members must remain silent or the Chair will take action.

Mr HOLT:

– These are the men-

Opposition members interjecting,

The CHAIRMAN:

– Order! The honorable member for Darling (MrClark) will apologize to the Chair for interjecting.

Mr Clark:

– I did not speak.

The CHAIRMAN:

– The honorable member did interject and he will apologize.

Mr Clark:

– I apologize for not having spoken.

Mr Pollard:

– Why do you not pick the right one.

The CHAIRMAN:

– Order! The honorable member for Lalor (Mr. Pollard) will apologize to the Chair.

Mr Pollard:

– I apologize to you for not picking the right one.

The CHAIRMAN:

– The honorable member will apologize unconditionally.

Mr Pollard:

– I apologize.

Mr HOLT:

– Obviously, honorable members opposite cannot take this criticism because it happens to be true. These are the same men who, in the life of this Parliament, have resisted our national training scheme.

The second matter to which the right honorable gentleman referred in the course of his rambling discussion - he kept reverting to it as a sort of motif - was his story about a depression. In the first public comment that he made on the budget he described it as a “depression budget”. His remarks were in contrast with views expressed by other Labour leaders who have knowledge of the misery and wretchedness that are caused by depressions. I believe that nothing would please the right honorable gentleman and some of his colleagues more than that Australia should find itself in a depression during the next few years. They desire that a depression should occur in order to enable them to gain their own partypolitical ends. They desire to see the wretchedness and misery that a depression would cause. However, the Government has a proper recognition of its responsibilities and my colleagues and I have no more intention to allow Australia to get into a depression than we have to allow galloping inflation.

Honorable members interjecting,

The CHAIRMAN:

– Order ! Honorable members on both sides must remain silent. I ask the Vice-President of the Executive Council (Mr. Eric J. Harrison) to keep quiet.

Mr HOLT:

– The Leader of the Opposition declared that this was a depression budget and that it had given the people of Australia a severe shock. The budget was announced on a “Wednesday and on the following day, which happened to be a. public holiday in Melbourne, I was interested to note that the people of that city were so depressed by the budget that in order to cheer themselves up they attended in record numbers at the Melbourne Royal Show and at the races at Caulfield ! That day was not a holiday in Sydney, but in that city the people rushed to buy items that would be affected by the budget. However, by some curious process apparently, the stock exchange showed no signs of awareness of the terrible things that, according to the Leader of the Opposition, threaten to happen as the result of the budget. Shares on the exchange in both Melbourne and Sydney rose the following day and have continued to rise steadily since that date.

Mr Curtin:

Mr. Curtin interjecting,

Mr HOLT:

– If the right honorable gentleman had been a member of the Parliament in the depression years-

Mr ERIC J HARRISON:
WENTWORTH, NEW SOUTH WALES · UAP; LP from 1944

– Right honorable?

Mr HOLT:

– He is not even right; and I doubt very much whether he is honorable. During the last depression there was no evidence of the share market rising. When the Leader of the Opposition talks about bonds having fallen to their lowest level does he remember the days of the Scullin regime, what the price of bonds was then and that 32 per cent, of the Australian people were unemployed? The price of bonds at that, time dropped to a tragically low level.

Honorable members interjecting,

The CHAIRMAN:

– Order ! Interjections must cease or I shall take appropriate action. The honorable member for Watson (Mr. Curtin) is persistentlyinterjecting. He. must remain silent.

Mr HOLT:

– I take the following extracts from a Melbourne afternoon newspaper of to-day’s date: -

page 221

QUESTION

SHARES RISE ON ‘CHANGE

Pastorals Gain

The upward share swing was accelerated on “Change to-day and many sharp rises wereregistered.

Bullish factors were the partial recovery of the wool market and the belief of investorsthat companies had not been too severely dealt with in the Federal budget. Pastoral shares strengthened.

The same newspaper published another paragraph on its financial page under the heading -

Bonds steady on ‘Change.

If that is a prescription for a depression we shall have a depression of a kind entirely different from that which Australia suffered under a Labour administration in the 1930’s. The Leader of the Opposition went on to say that the budget would create unemployment. He talked’ about what the late Mr. Chifley had tosay on that matter, and said that Mr. Chifley’s name would always be associated with a policy of full employment. I have a very sincere regard for the memory of the late right honorable gentleman. I should think that if he weresitting opposite me at this table to-night he would have made a speech very different from that which we have just heard from the present Leader of theOpposition. In order to fortify my judgment on that matter, I remind the right honorable gentleman of what Mr. Chifley had to say when speaking in a debate on a financial measure in thisHouse about this time last year. In thelimited time at my disposal, I shall quote several short passages from the speech. that Mr. Chifley made on that occasion.

He said - 1 believe that when a country is in a prosperous condition, it should pay its way, and, if possible, provide an additional sum of money for capital works or for reserves. I make no bones about the attitude of the Labour party in that matter. In my opinion, that, is the proper and business-like method to adopt.

Later, he pointed out that inflation is a world-wide phenomenon, and said -

The United Kingdom, France, Italy,’ Belgium and various* other countries have fought strenuous battles against the terrible menace of inflation. At this juncture, I merely comment that Australia will not win its struggle against inflation by adopting piffling measures.

I do not think that the present Leader of the Opposition would say that the measures embodied in the budget are piffling. Mr. Chifley continued -

I hope that the Government will do something to correct the present disturbed state of our economy, irrespective of whether such action will be popular or unpopular. I trust that it will have the courage to confront the problems that ‘beset it, because if it does not take constructive action to improve the present situation the consequences will be experienced not only by the present, but also by future generations. The Government must place the economy of this country on a sound basis. After all, we need only think for a moment of the hardships occasioned to the Axed income group in the community by the continuing depreciation of our money.

Bearing those statements in mind, I ask the people of Australia which kind of budget do they think Mr. Chifley would have brought down at this time - the kind that we have heard described by the present Leader of the Opposition or a courageous budget of the kind that the Treasurer (Sir Arthur Fadden) has presented ?

I turn now to the problem of unemployment because members of the Opposition are trying desperately to create a depression psychology. They are telling the people that before they know where they are unemployment will be widespread and depression will be upon the country. Earlier to-day the House debated the Government’s decision to dismiss 30,000 public servants. The Leader of the Opposition referred to that matter in the course of his speech. At that time, T made a challenge which I now repeat. I invite any member of the Opposition to name one person who has been retrenched from the Public Service and who has tried unsuccessfully to find a suitable position. Far from experiencing conditions of unemployment at present we have a condition of such over-full employment that in the Department of Labour and National Service alone over 120,000 vacancies are registered. During the last few weeks I travelled around Australia from Cairns to. Collie and in every district I was pressed by governmental, semi-governmental and private employers to make available sufficient man-power to enable them to get on with essential undertakings. Throughout Australia quantities of capital equipment have been only partly used or are lying idle because sufficient suitable man-power is not available. In Western Australia at a time when we are desperately short of timber I was told that eight timber mills were only half staffed. At a time when the Premier of Victoria, was endeavouring to enlist 3,000 men overseas for service on the railways and hundreds for service in the tramways system vital industries were not able to carry on because of a shortage of man-power. We are very far from a situation when men will be looking for jobs and jobs will not be waiting for men. When the previous Leader of the Opposition, Mr. Chifley, is cited to me as a person whose name will be forever associated with a policy of full employment, I feel that I am justified in reminding honorable members of what he had to say on this very subject to a Labour gathering in October, 1948. He said -

No guarantee can be given to anybody that they can stay put in a particular industry. It is realized that there will have to be transfers of workers, and in many cases transfers of whole communities to other forms of work. J am certain that everybody will not be able to stay at home, because there will have to be transfers of labour if there is going to be expansion. I am not going to fool any oni> in that regard. ‘lt may even involve a plan of moveable towns.

It will be a long way before any policy of retrenchment that the Government puts into effect carries people to such lengths, in searching for jobs, as Mr. Chifley himself regarded as reasonable in order to encourage industries in Australia.

The next matter that the Leader of the Opposition mentioned was what he described as the Government’s rejection of prices control. As a constitutional lawyer - and he claims that his eminence ha3 risen in this field in recent days - he should know that, at the present time, the Commonwealth does not possess constitutional power to enable it to exercise prices control. He should also know that at the recent conference of Commonwealth and State Ministers several Premiers indicated quite flatly that they were not prepared to transfer to the Commonwealth power to control prices. The Leader of the Opposition suggested that the Government should submit to the people, by way of a referendum, a proposal that power to control prices should be vested in the Commonwealth. I remind him that a referendum on that subject was held not so very long ago - in 194S. The right honorable gentleman himself was one of the leading figures in that campaign. “When he raised this subject to-night I found it interesting to recall what he had to say a couple of weeks ago when another referendum was held, and a majority vote for “ No “ was recorded. On that occasion, the Leader of the Opposition hailed the verdict of the people as the vote that saved Australia from some fate worse than death that he had conjured up in his mind. He claimed that the majority for “ No “ recorded the final judgment of the people on that particular issue. Yet an analysis of the vote in the recent referendum reveals that 68 of the electorates recorded a majority for “ Yes “, and only 53 electorates recorded a majority for “ No “. However, the right honorable gentleman considered that he had sufficient grounds for asserting that the people had spoken. Well, if they spoke a fortnight ago on the question that was submitted to them, they spoke with a louder voice in 1948 when they rejected the Labour Government’s proposal that power to control prices should be vested in the Commonwealth. On that occasion, he was able to secure a “ Yes “ majority in only fourteen of the 74 electorates. Therefore, when he urges the Government to hold a referendum on prices control, I think that we may fairly point out to him that the Australian people spoke with no uncertain voice on that occasion. He has yet to explain how prices control exercised by the Commonwealth can be more satisfactory than prices control exercised by the States. I take this opportunity to remind him that the Labour Government in New South Wales has full power to control prices. As we are well aware, it has exercised that power in recent times to keep down the price of butter to a figure below the cost of production. It is rather remarkable that in spite of the fact that the Government of New South Wales has full power to control prices, the basic wage, based on cost of living figures, is higher in that State than it is anywhere else in the Commonwealth. The Leader of the Opposition should have a discussion with his colleague, Mr. McGirr, to see whether they can solve that problem out between them.

The Leader of the Opposition also referred to the provision in the budget for social services. If there is one feature of the budget which the Government can regard with some satisfaction and pride it is that, during a period when we have to make extraordinary provision for defence, and for State works from revenue, and when we find it necessary to impose additional taxes, we are able to increase age and invalid pensions and repatriation benefits. The right honorable gentleman airily say3 that the proposed social services payments should be increased by an additional 5s. or 10s. a week. I do not know whether he has bothered to count the cost of his proposals, because he seems to have an airy disregard for the cost elements that- come into the budget. Although I listened patiently to his speech, I did not hear him suggest one item of the budget that should be reduced. When I make that statement, I do not forget that he has moved that the proposed vote for the Senate be reduced by £1, but that is the formal procedure that is followed by an Opposition when it desires to censure a government upon its budget proposals. Even if the amendment were agreed to, the saving of £1 would not get us very far. Apart from that, the Leader did not suggest one specific item which he considered should be reduced. In fact, he proposed that expenditure on social services and defence, which are two of the largest items in the budget, should be increased. Where is the Government to obtain the funds for those extraordinary expenditures which the budget has revealed? The Leader of the Opposition did not make one suggestion about the way in which the revenue should be raised in order to finance the budget. On the contrary, if one were to take his words at their face value, he urges that taxes should be reduced substantially. He told us that the budget proposals would destroy incentive, and leave the Australian people without hope. I realize that figures are dull things, but sometimes it is imperative to use facts in order to defeat wide, sweeping, reckless, general statements such as the right honorable gentleman has made this evening. Let me compare the proposed rates of tax with those that applied during World War II., when a Labour government was in office. Members of the Labour party did not consider that severe taxes destroyed incentive then. In fact, they frequently contended that production was maintained at satisfactory levels. I have selected only three items because time will not permit a longer analysis, and I relate them to what I regard as the average family in Australia, that is, a man, his wife, and two children. First I take what I call the average weekly earnings group. According to figures compiled by the Commonwealth Statistician, average weekly earnings at the present time are a little more than £12 a week or approximately £600 a year. In war-time, such a man paid tax of £118 a year, but tinder the present budget proposals, he will pay £20 per annum. We have heard a good deal about the middle income group. A man in receipt of £1,000 a year paid tax of £285 in war-time but under this budget he will pay £91, or less than one-third of the wartime tax. A man with an income of £1,500 a year paid tax of £538 in wartime; under this budget, he will pay £228, or less than one-half of the wartime tax. It may be contended that high rates of tax were necessary in war-time, and we may be reminded that Australia is now at peace. I think that all honorable members will agree that it is a very uneasy peace. But let us look further afield with the object of examining rates of tax imposed by members of our fellow democracies in the English-speaking world. Time will permit me to mention only our nearest neighbour, New Zealand, and the United Kingdom. A comparison of rates of tax is as follows : -

Those are the taxes which, according to the Leader of the Opposition, will destroy the initiative and optimism of our people who, in the brief period of Australia’s history, have, proved their strength, energy, and courage ! If ever we have listened to a process of humbug in the analysis of a budget we have done so to-night.

The right honorable gentleman made the extraordinary claim that we were frustrating the hopes of our people and denying them a decent standard of living. Again I resort to figures for the purpose of contrasting the situation of the Australian people to-day with their situation immediately before World War II. Many Australians are looking for a return to pre-war price levels, but most of us realize that, having regard to world trends, such a return is utterly impossible. There is, I hope, a sufficient number of sensible people who look not so much to price levels as to the standards of goods and services that they are obtaining in the present economic circumstances. How did Australians, whom the Leader of the Opposition has said that we are frustrating by ignoring their natural feelings and aspirations, fare during the first full year of this Government’s administration? The figures that I shall cite compare their circumstances in 1938-39 with the circumstances that prevail to-day. In 1938-39, 54,000 new private motor cars were registered in Australia. In 1950-51, 127,000 such vehicles were registered. In 1939, 24,000 new commercial vehicles were registered, and last year 77,000 were registered. The Leader of the Opposition tried to paint a tragic picture of what this Government was doing to the man on the land. In 1938-39, 4,380 tractors were imported. In 1950-51, the total was 34,659. The record of savings bank deposits shows that the average deposit per head of the population has increased from £35 in June, 1939, to £100 now. An even more impressive comparison can be drawn from the fact that personal savings by the Australian community in 1938-39 amounted to £48,000,000, whereas in 1950-51, as revealed in the budget-papers, such savings amounted to £430,000,000. The Leader of the Opposition had something pathetic to say about refrigerators. He will be interested to know that, in 1938-39, Australian housewives were supplied with only 37,000 refrigerators, and that in 1950-51 they were supplied with 190,000 refrigerators. Furthermore, if we consider purchases of consumption goods, which are now being subjected to extra excise duties, we cannot truthfully say that the Australian citizen has fared badly. For example, the consumption of beer increased from 90,000,000 gallons in 1938-39 to 164,000,000 gallons in 1950-51. Australians smoked 23,300,000 lb. of tobacco, cigars and cigarettes in 1938-39, but consumed 41,500,000 lb. in 1950-51. The Leader of the Opposition also spoke of dreadful things that were likely to happen to the housing programme. I remind him that, in the last year before World War II., when the housing programme was at a record peak, we commenced the construction of 40,000 houses and that, in 1950-51, we commenced 80,000 houses.

The right honorable gentleman covered so much ground that, if I were to pursue him, I should take almost as much time as he occupied in his speech. I do not propose to do that. This committee can more usefully settle down to a more analytical examination of the budget than he attempted to make. He claimed that no supporters of this budget, other than Sir Douglas Copland, apparently, could be found outside this Parliament. But we, too, have our contacts in the Australian community. We represent people who have sent us here by their votes and who have consistently supported us over the years. We have confidence, trust and belief in the Australian people, and we can form a reasonable assessment of the manner in which they will react to the kind of measures that we believe to be necessary for their salvation. I have been

1.81

agreeably surprised to learn that, despite the panic and the hysteria that have characterized the statements of the Leader of the Opposition and certain sections of the press, the more sober-minded and sensible elements in the community have welcomed this budget for what it is - a courageous attempt to deal with a situation in Australia which is comparable with a situation in other parts of the world and which, if unchecked, would have led us head-long into galloping inflation. With courage, and a fair trial, this budget will prove to be a success.

The CHAIRMAN:

– Order! The Minister’s time has expired.

Mr TOM BURKE:
Perth

.- The budget is a bad budget. That is true notwithstanding its lengthy and emotional defence by the” Minister for Labour and National Service (Mr. Holt). The most amazing feature of the Minister’s speech was the emotional outburst which arose from a simple statement that had been made by the Leader of the Opposition (Dr. Evatt). Speaking for the Labour party, the Leader of the Opposition said, in effect, “ We have an interest in defence because, in time of war, the nation turned to Labour to lead it “. That was described by the Minister as an extraordinary statement, a despicable statement, a brazen and wicked claim. 1 shall not enter into an argument with him; I shall merely state the facts.

The political counterparts of the present Government parties were elected to office successively in 1934, 1937 and 1940. World War II. was in progress at the time of the last of those elections.- The present Prime Minister (Mr. Menzies) and the present Treasurer (Sir Arthur Fadden) were Prime Minister and Treasurer, respectively, in the Government that was formed after that election. But, after the war had been in progress for less than eighteen months, that Government fell.

Mr Turnbull:

– How?

Mr TOM BURKE:

– By the votes of two men who had been the pledged supporters of that Government. The honorable member for Mallee (Mr, Turnbull) and. the honorable member .for Gippsland (Mr. . Bowden), who also interjected, will find the record’ of some very interesting comments by the then honorable member for Henty in reply to the Treasurer of the day, who again holds that office, if they will study Ilansard of that’ period. What happened? The Government that succeeded the Menzies-Fadden Government lacked a majority in both Houses of the Parliament and, when it went to the country, the people took advantage of the chance that was afforded to them and, in the words of the Leader of the Opposition, turned to Labour in the biggest landslide in Australia’s political history.’ The simple statement of that fact by my colleague and lea d w to-night was characterized by the Minister for Labour and National Service as an extraordinary statement, a despicable statement, a brazen and wicked claim. That outburst proves how tender the Government is. It indicates more clearly than can any public opinion poll or newspaper comment that the Government knows its budget to be a “phoney” measure that will only make inflation worse confounded.

The Government knows that inevitably, as costs rise higher and higher as the result of its deliberate and calculated economic policy, a depression will loom closer and more threateningly over this country. If ever we heard the statement of a man who knew the falsity of his case, it was the statement in support of this damaging budget by the Minister for Labour and National Service. This budget will accentuate the inflation that exists to-day. It will not merely raise price levels; it will send them leaping up. And when perhaps the war scare is removed and the United States of America, Great Britain, Prance and other countries cease, for perhaps six months, twelve months, or even two years, to buy our wool, wheat, and Other commodities, there will be an inescapable crash. That is the picture that is painted by this Government. It was apparent from the Minister’s emotional and incorrect statement that he realizes only too well what will be the result of the sins of omission and commission of the Government. I consider that the Minister for Labour and National Service is the only member of the Government .in this House who brings;-, a liberal mind to the problems of t-he day..; He sometimes gives non-party, convsideration to situations that confront this . country. It is no wonder that he. iS disturbed about the present situation. ; and that therefore, he wildly exaggerated , the simple statement of fact that; was presented clearly and . quietly., by the Leader of the Opposition. The Minister stated that Labour, tried to cut down the defences of Australia before the war. That charge has often been made. I invite new members of the Parliament to read the Hansard report of the debates in this House before the last war. The older members of the House know the situation very well, although they will not say so. The fact . is that from the time war appeared imminent the Labour Opposition at that time ‘ supported every demand that the government of the day made for finance. Indeed Labour’s leader, John Curtin, stated atthe time that the Labour Opposition had given to the Government every Id. for defence expenditure that it had sought, and that if the Government required addi-. tiona! finance the Labour Opposition would not oppose the measure. Mr. Curtin contended that if, a week after the Munich crisis, the Government had claimed that additional finance was required for defence purposes, that was an indication that insufficient provision had been made previously. I have before me an interesting reference to defence by the Treasurer (Sir Arthur Fadden) . It is not old in history as time goes. I should not have referred to it but for the Minister’s statement to-night. On the 23rd May, 1939, when speaking on the Supply and Development Bill, the right honorable gentleman is reported in Hansard, volume 159, at page 632, to have stated -

War implies a breach of international relations, and therefore it appears to me that every logical system of defence should provide for the maintenance of international friendships, . .

Of course, that was quite reasonable. He continued - the smoothing out of difficulties with potential enemies, and the establishment, of intimacies with potential allies. . . . Naval and military experts often seek to take advantage of critical times in order to urge expenditure on projects calculated to advance the interests of the professional sailors and soldiers rather than those of the country.

If supporters of the Government want to press the charge made by the Minister they should first answer the charge that was made by the present Treasurer.

The Minister stated that the Leader of the Opposition wants substantial rises made in pensions and other social services. The Leader of the Opposition pointed out that, allowing for the proposed increases, the pension rate for a single age or invalid pensioner will be only 31 per cent. of the basic wage. It is expected that there will be a rise in the basic wage towards the end of this year, a further rise early next year, and a third rise about the middle of 1952. Assuming that these increases will be of amounts similar to recent rises, the pension rate to which I referred will be only about 15 per cent. of the basic wage by the time the next budget comes clown. Is the Government going to look coldly at that suggestion and say, “ This is the greatest increase fiver given in the history of Australian politics”? that comparison indicates graphically the situation that this nation faces to-day. In the next twelve months the percentage of pension to basic wage will decrease to a record low in the history of any country in the world, unless the Government heeds the request of the Opposition to advance still further the payments to be made. The Minister says, “Very good, if you want us to cut downtaxation, where is the money to come from ? “ It would appear that the Minister has not read the budget speech. That is a strange statement for . him to make in view of the fact that the Treasurer has budgeted for a disclosed surplus of £.1.14,500,000. . What about using some of that money? The Treasurer has stated that it is to be put where it can dp the least harm. ‘ It would not do much harm to apply some of it to increase age, widows’ and service pensions. Can the PostmasterGeneral (Mr. Anthony) or any other Minister pointout how that would do harm ? The Leader of the Opposition (lid not have to say where the money would come from, because the Treasurer had already told us. . The right honorable gentleman also stated that it was intended to build up the National Welfare Fund. Like a magician he has produced “out of thethat” record sums that have beentucked away in every hole and corner by the Government, and piles up a huge surplus. Yet he declines to increase social services payments to the same extent as increases that were granted by Labour in 1948. To the Treasurer’s claim that the money must be put where it cannot do too much harm we say that it would not do a tittle of harm if it were utilized in the manner that I have indicated.

Mr Joske:

– Does the honorable member consider that the Treasurer should not have budgeted for a surplus?

Mr TOM BURKE:

– I shall refer to that aspect of the matter later, if time permits. The Minister also referred to a speech that was made by Mr. Chifley, our lateand honoured leader. I heard that excellent speech, which was made to the. Labour conference in 1948. Mr. Chifley stated that Labour would provide full employment for all time, that there would be no more economic conscription and that never again would workers have to tramp the streets . looking for jobs if by some mischance depressed conditions should come upon us. He stated that jobs would not necessarily be found in the cities, that ‘the workers would hot necessarily be home every night; they’ would be in some part of Australia and would assist to develop this great nation. Hemade it clear . that Labour would make conditions goodin order to attract the workers. . There would be reasonable rates of pay, and all the other things that are indirect and clear contrast to the economic conscription policy of this Government. The use of that speech in ah attempt to counter the arguments that were advanced by the Leader of the Opposition to-night indicates either a complete lack of knowledge of what was said in itor a completely dishonest approach to the; matter by the Minister for Labour and National Service.

Mr Turnbull:

– The speech was reported in Hansard. It was not delivered to a Labour party conference.

Mr TOM BURKE:

– The honorable member for Mallee (Mr. Turnbull is, as usual, completely off the track. The late Mr. Chifley delivered that speech in 1948 to a Labour party conference at which I was present.

The honorable member for Warringah (Mr. Bland) asked whether we believed in budget surpluses. In some circumstances it is wise to budget for a surplus, but in doing so regard must be had to certain major factors. First, some taxable capacity must be left. A fairly low rate of tax must be in operation before a surplus can be accumulated by imposing heavy taxes upon the people. When the rates of tax are high, the Treasurer cannot add much to them in the hope of accumulating a surplus. I do not know how far existing rates of tax are adversely affecting the productive effort of Australian industry, but I believe it to be correct to say that at the present time an increase of the rates of tax would hamper production. Industry may be able to carry the existing1 rates of tax, but it will resent the new imposts which will enable the Treasurer to accumulate a disclosed surplus of £114,500,000. The Leader of the Opposition stated the position correctly when he said that the attitude of the Treasurer was that people might spend their money unwisely and that he would take some of. it away from them and tuck it away in a place where it could do no harm. The present situation is one in which the Treasurer should not budget for a surplus. There must be a reasonable taxable capacity left.

Another factor that must be considered in deciding whether or not to budget for a surplus is that when one of the objects of the budget is to check a sharply rising price level, it is unwise to try to obtain the surplus by increasing indirect taxes. It has been estimated that, as a result of the increases of sales tax, revenue will be increased by £52,000,000 a year, or £1,000,000 a week. It is alleged that the increases will help to check inflation. An increase of sales tax could achieve that objective if it were designed, not to increase revenue, but to force non-essential industries to close. It is obvious that that is not the object of these increases of sales tax, because the Treasurer has said that, as a result of their collection, Commonwealth revenue will receive an additional £52,000,000 a year. He has budgeted for a continuation of the production of luxury goods. The effect of the increases will be to send the cost of living in this country soaring sky-high.

By accumulating a surplus in an attempt to counter the inflationary trend, the Treasurer will increase sharply the cost to the Australian people of goods and services. It is idle to say that only one or two of the items listed in the schedules to the sales tax measures have an effect upon the basic wage. Is the Treasurer unaware that all taxes, unless they be direct taxes such as income tax, are passed on? Surely he knows that the increased rates of sales tax, although they do not apply to articles that bear immediately upon the basic wage, will, when they are passed on finally, increase substantially the cost of items on which the basic wage is calculated. The right honorable gentleman, in the famous speech that he delivered in 1939, disowned the proposal with which he has wooed the electors and deceived this Parliament for the last two years. At that time, he referred to an excess profits tax as a waste of time. He said that those upon whom it was imposed not only recovered the amount that was taken from them by means of the tax but also made a profit upon it. He stated -

Rather than allow profits and then tax them after they are made and thus allow the cost or effect to be passed on to the main sections of the community who pay it in the final analysis - workers and the producers - we should prevent the profits by a scheme of limitation such as I have mentioned.

In 1939, the right honorable gentleman was a critic of the Government. He said then that all taxes were passed on, but now he and other Government supporters are telling us that the increased rates of sales tax apply to only one or two items in the “ C “ series index. A swindle is being perpetrated upon the Australian people to-day. If what the Government did recently were done by private business or commercial interests, it would savour strongly of sharp practice.

The Treasurer is budgeting for a surplus of £114,500,000 because the people of

Australia have no confidence in the Government. For the first time for many years in this country, government loans have been under-subscribed. The reason for that is easy to find. A little time ago, a 4 per cent. loan matured. Letters signed by the Treasurer were sent to bondholders asking them to convert their holdings to holdings in a 3$ per cent, loan. Not all the bondholders fell for the trick that the Government attempted to practice upon them at that time. It was a trick, and I make no apology for having so described it. Many of them accepted the offer and converted their holdings in the 4 per cent, loan to holdings in the 3£ per cent, loan. The conversion was not a full success. It fell short of the total amount that was available for conversion, but the cash portion of the loan was heavily over-subscribed. All the quotas in my own State were filled before the loan was opened. Then, when these poor devils, who had invested their money in Commonwealth loans because they had faith in the government of the country, had converted their 4 per cent, securities into 3$ per cent, securities, the Government issued a loan at £99. That was as clear a signal as any man with any knowledge of finance could want that the yield on Commonwealth securities was to be increased. There was no reason for making an issue at £99, because the previous loan had been over-subscribed “ by £8,000,000. But, for some ob’scure reason, the next loan was issued at less than par. It was issued at a discount of 1 per cent., which meant, in effect, that the interest rate was increased. That loan was heavily over-subscribed. Then the Government, having persuaded the holders of millions of pounds worth of Commonwealth securities to convert securities returning 4 per cent, to others bearing an interest rate of 3-J per cent., increased the interest rate on the next loan to 3- per cent.

Mr Eggins:

– The Loan Council did that.

Mr TOM BURKE:

– The Government must accept full responsibility for that action. It has no alibi. If newspaper reports were correct, the States demanded the retention of the existing rate of interest, but the Commonwealth insisted that the rate be increased, and the new loan was issued at 3$ per cent. As a result, the value of the securities that had been issued to those persons who had converted declined by as much as £S 10s. per cent. Now the Government is wondering why its loans wore undersubscribed.

Something even more remarkable occurred. The rate of interest on the new loan was 3£ per cent. Whether by de- liberate design, by accident or because of ignorance it was said to be a small loan intended to test the market. That was a clear indication that the rate was to go higher. The Government has deliberately forced up the rate of interest. What does not suit the various State governments should not suit the Australian Government with its works programmes which call for provision from loan money. Certainly a higher interest rate does not suit business and factory undertakings which are working on bank overdrafts to-day. The cheap money era was a boon to such people because some counter was thereby provided to the rising cost of living and to the inflationary situation generally. Only one class of people in Australia will benefit from the increased interest charges that have been brought about by the deliberate action of this Government. I refer to the trading banks which have loaned substantial sums of money on overdraft. Interest rates on those overdrafts will rise automatically with the rise of the ordinary interest rates.

This Government has been a complete failure. It has now presented a budget which will do nothing to counter inflation but will cause prices to skyrocket more rapidly than ever before. It does not seek to arrest expenditure on luxury items. Instead, it seeks to capitalize such expenditure by dragging from it a far greater yield by means of taxes. The interest policy of the Government represents a step towards such a degree of inflation as may easily engulf this country. One of the most outworn economic theories is that borrowing can be curtailed by increased interest rates.

The policy of this Government will have the effect of preventing people from building houses, for instance, because the interest rates will be so high that they will not dare to commit themselves to the risk of repayment of principal and interest over a long period. I suggest that that is the intention of the Government and that this budget continues its sorry record in other respects in recent times.

The proposals embodied in the budget will in all probability bring about a sharp reaction downwards. “Honorable members will be aware that the basic wage of from £5 or £6 a few years ago has risen to approximately £10 at the present time. If there are further increases at the same rate during the lifetime of this Government, before very long it will have risen to £20 n week. Inevitably there will be an adjustment downward, with steeply falling prices, accompanied by ruin and misery. With complete and utter dishonesty, the Minister for Labour and National Service to-night charged the Opposition with desiring to bring about a depression psychology. I am of the opinion that the Government itself is bringing about such a state of affairs. The Opposition urged the Government to assume control of prices, but the suggestion was rejected. The Treasurer has stated that he does not believe in such control, and the Minister for Labour and National Service said_ to-night that the States will not refer the requisite power to the Australian Government. I asked him at the time to name the States concerned, but he declined to reply to my query. The impression of the Australian Labour party is that all the States of the Commonwealth are eager that the burden of prices control shall be taken from their shoulders, because they are totally unable to cope with it.

This budget is an onerous and a bad one. Instead of being counterinflationary, it is calculated to produce bigger and better inflation. The Leader of the Opposition has challenged the Government to test, the feeling of the country. Why should it not do so? This Government was elected because it promised to reduce taxes and remove con- trols. Instead, it has done exactly the reverse.

The CHAIRMAN:

– Order ! The honorable member’s time has expired.

Mi-. GRAYDEN (Swan) [10.16].- After listening to the Leader of the Opposition (Dr. Evatt) for one hour and a quarter and to the honorable member for Perth (Mr. Torn Burke) for half an hour, I find myself in agreement with them on one point : that this budget is of great importance to Australia. I am in complete disagreement with them on every other matter that they have raised. It is completely impossible for me tonight, in the limited time at my disposal, to follow the Leader of the Opposition through the labyrinth of untruths, halftruths, innuendoes and fallacious arguments that he has advanced and for which he is becoming increasingly notorious. The Minister for Labour and National Service (Mr. Holt) has already dealt with the points raised by the right honorable gentleman, which were merely repeated by the honorable member foi’ Perth, and, therefore, I do not propose to discuss them. My purpose it to deal with the defence aspect, which I consider to be of greater importance at this time and which is within the scope of the budget. To-day, Australian troops are. fighting in Korea, and are giving their lives in an endeavour to ensure that that country shall not be conquered and used by Russia as a strategic point for the successful launching of a war against the free world. Yet in Australia a battle of another type is being waged, not by troops but by Labour spokesmen and by Communists. It is a battle to secure what would be virtually an open season for treason in this country. The activities that have been carried on in Australia during the last few months have served to establish the Leader of the Opposition as Australia’s No. 1 Communistcollaborator.

Mr Curtin:

– I rise to order. I object to the statement made by the honorable member and I demand that it be withdrawn.

The CHAIRMAN:

– Order ! No remark was made concerning the honorable member for Watson (Mr. Curtin).

Mr Curtin:

– It was made against my leader.

Mr GRAYDEN:

– I repeat that the Leader of the Opposition is Australia’s Vo. .1 collaborator. He was the man responsible_ for lifting the ban on communism during World War II. He was a prominent member of the Council for Civil Liberties, which concerned itself with the protection of those traitors to Australia, Ratliff and Thomas.

Mr George Lawson:

– That is absolutely untrue. The honorable member does not know what be is talking about.

The CHAIRMAN:

– Order ! We should get on better if honorable members would cease interjecting.

Mr GRAYDEN:

– During the 1944 powers referendum, the present Leader of the Opposition had to go outside tinLabour party for support, and appointed a joint Communist-Labour campaign committee.

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES · ALP; LANG LAB from 1932; ALP from 1936

– He did not!

Mr GRAYDEN:

– He did that in 1944. Whom did he appoint to sit on that committee? He appointed Chandler, the organizing secretary of the Australian Communist party.

Mw Ward. - The honorable member is off the beam”. He has a “red” phobia.

The CHAIRMAN:

– Order ! The honorable member for East Sydney must remain silent.

Mr GRAYDEN:

– He appointed the secretary of the Sydney branch of the Australian Communist party. He also appointed Wright, who is a member of the Communist party’s central committee. These men were among the leading Communists of Australia. [Quorum formed.’] Then we had the right honorable gentleman’s recent activities in the last referendum campaign, when by untruths, innuendoes and distortions of fact he secured a sanctuary for Communists in the Commonwealth Public Service, in key trade unions, and in Australia generally. Yet honorable members opposite deny the charge that their leader is Australia’s No. 1 Communist collaborator. Consider the phraseology that the Leader of the Opposition used during the recent referendum campaign and which he also used here to-night. He talked about “fascists” and used other similar terms - phraseology which- in the past has been peculiar to the Communist party. This is the first occasion on which the leader of a. major political party in this country has used that kind of phraseology. The Leader of the Opposion talks about fascists and levels against honorable members on this side of the chamber the charge that they are in that category; but the truth of the position is that SO per cent, or more of honorable members on this side actually fought fascism during the recent war. The Leader of the Opposition also ignores the fact that there are two kinds of fascists - the ordinary kind and the “ red “ kind. Roth of them are obnoxious. f consider that what I have said establishes that the Leader of the Opposition is, without question, Australia’s No. :i Communist collaborator. It becomes increasingly obvious with every month that passes that there is a close agreement between the Labour party and the Communist party. Under it the Labour party rushes to the aid of the Communist party whenever the latter is threatened. In return, the Communist party aids the Labour party by disseminating malicious lies about non-Labour leaders, by assisting it nt the polls, and by giving it the second preferences of its candidates at general elections. Under the agreement, both parties even take punitive action against each other so as to give the impression that there is no collusion between them.

I challenge the Leader of the Opposition to deny that open collaboration between the Communist party and the Labour party is taking place to-day, and has taken place during the last few months. I challenge him either to admit it or to deny it and so make a liar of himself in the eyes of his own supporters, who know perfectly well the degree of the collaboration in which he has engaged in recent months. We have only to consider what took place in the Division of Swan during the recent referendum campaign to realize what has gone on. Many people in Swan were amazed when they went along to vote at the polling booths and found that there were no Communists handing out Communist “ How to vote “ cards. That was because all the well-known Communists in Swan were handing out Labour “ How to vote “ cards. Later in the day the Labour party suddenly decided that a “How to vote “ card that had been prepared by the Communists was more effective than, the Labour party card. Of course, the Communist card had on it no mention of communism. Its slogan was “ For peace, prosperity and liberty”. So, almost without exception the entire force manning the booths on behalf of the Labour party was switched over to the distribution of the Communist card. Wellknown Labour supporters and well-known Communists were rostered together by the Labour party for that work. So I challenge the Leader of the Opposition either to admit that there was collaboration or to deny it and so make a liar of himself in the eyes of his own supporters, who know perfectly well what the position is.

Let us consider the kind of individual with whom the Labour party was cooperating in the Division of Swan. There are 1,300 Communists in that division - 1,300 potential traitors, potential fifth columnists and potential quislings. Many of them are colleagues of Dean and Rudkin, both of whom hail from the Division of Swan. Dean lives at Victoria Park, in the centre of the electorate, and Rudkin in South Perth. During the war Dean was found in possession of maps and documents that disclosed details of every gun emplacement on Rottnest Island, as well as the location of the guards. At that time the only weapons that stood between Perth and a hostile navy were those that were on Rottnest Island. Dean is the colleague of the people in Swan with whom the Labour party co-operated during the recent referendum campaign. He was tried before a Perth magistrate, who said, when sentencing him, that he had not the slightest doubt that the information in his possession was to be transmitted to a foreign power. Then there was Rudkin, who was found in possession of instructions from the Soviet authorities to the Communist organization to infiltrate the air raids precautions organization in Perth. Already it had 100 members in the organization. Those are the persons who collaborated with the Labour party during the last general election campaign. These facts establish the truth of the assertion that the Leader of the Opposition is Australia’s No. 1 Communist collaborator.

A further result of the activities of the right honorable gentleman has been the development of a rift in the nation such as has never occurred before. The people are losing confidence in their own countrymen, because Australian troops in the field, for the first time in the history of Australia, are being betrayed by the leader of a responsible political party. Some of our troops are laying down their lives in Korea, and others will rot in hospitals as a result of their service there. While that is going on the Leader of the Opposition is aiding and abetting traitors in Australia.- He is aiding and abetting those who are sabotaging the defence preparations of the country.

The CHAIRMAN:

– Order! The honorable member is out of order in speaking in that way of the Leader of the Opposition.

Mr GRAYDEN:

– I propose to read an advertisement which is appearing in the newspapers at the present time.

Mr ALLAN FRASER:
EDEN-MONARO, NEW SOUTH WALES · ALP

– I rise to a point of order. I ask that the honorable member for Swan (Mr. Grayden) be required to withdraw the statements which you, Mr. Chairman, have declared to be disorderly.

The CHAIRMAN:

– That is a reason-, able request. I ask the honorable member for Swan to withdraw the statements that impute improper motives to the Leader of the Opposition.

Mr GRAYDEN:

– If it will enable me to continue my speech, I withdraw the statements.

Mr ALLAN FRASER:
EDEN-MONARO, NEW SOUTH WALES · ALP

– The honorable member has not made an unqualified withdrawal.

The CHAIRMAN:

– The honorable member withdrew the statement complained of.

Mr Pollard:

– But the withdrawal was not unqualified.

The CHAIRMAN:

– If honorable members will remain quiet I shall be able to judge for myself what has been said and what should be done. I have accepted the honorable member’s withdrawal.

Mr GRAYDEN:

– The advertisement to which I have referred reads as follows : -

Volunteers wanted to join the elite of Australia’s fighting men in the service of the United Nations.

Korea Force

Two world wars proved that, where the call is for courage, Australia will provide it - superbly. That call is raised again, to-day - in Korea, where the forces of aggression must be smashed.

To help finish the job quickly, Australia’s finest fighting men are needed—men with the irresistible determination, the pride in themselves and their country which made the names of Gallipoli, Kokoda, El Alamein, glorious monuments to their invincible qualities.

Join the men who are adding new brilliance to the shining record of Australia’s fighting fame. Help make victory in Korea certainsooner !

The CHAIRMAN:

– That is a matter for the Chair to decide. In a budget debate wide latitude is allowed.

Mr GRAYDEN:

– That advertisement is an indication of the present world situation; yet two days ago the honorable member for East Sydney (Mr. “Ward) and the Premier of New South “Wales, Mr. McGirr, marched in procession in front of a float which ridiculed the idea that communism is a menace, even though Australian soldiers are giving their lives in the fight against com munism. It is not to be wondered at that the people are losing confidence.

Mr Anthony:

– I rise to order. Members of the Opposition are undoubtedly trying to prevent the honorable member for Swan from proceeding with his speech. I ask you, Mr. Chairman, to insist on the maintenance of order.

The CHAIRMAN:

– The honorable member for Swan will proceed.

Mr Daly:

– I rise to a point of order. Do you not interpret the Minister’s remarks as a reflection on the Chair?

The CHAIRMAN:

– The honorable member will resume his seat. There is no point of order. If there is any further interruption I will deal with those who are trying to prevent the honorable member from speaking.

Mr GRAYDEN:

– The Leader of the Opposition, by his recent activities, has not only given a new lease of life to communism in Australia, but has also given it a new impetus. Details have been published in a Melbourne newspaper of a master plan for the expansion of the Communist party as a direct result of the activities of the right honorable gentleman. I ask him: “What liberties does he seek for Communists in Australia ? Does he seek liberty to set up class barriers, to foment class warfare, and to set neighbour against neighbour in this peaceful land? Does he wish to give to the Communists liberty to sabotage our defence preparations and the economy of the country? Surely the Leader of the Opposition, in his defence of the Communists, has overlooked the liberties of the loyal citizens of Australia, including their right to live their own lives in peace without threat of interference from- enemies at home or abroad. I assure him that 99 per cent, of the people of Australia are still loyal. They disapprove of the action of the honorable member for East Sydney and the Premier of New South “Wales in parading the streets of Sydney in a procession which ridiculed the idea that communism is a threat to peace and security. May I remind the Leader of the Opposition of the words of a current song, which, apparently, he has not heard ? ‘They are as follows : -

The only red we want

Is the red we’ve got,

In the old red, white and blue.

It’s a brave red,

Not a slave red,

And it means liberty for you.

I urge honorable members to take those words to heart.

There is a stench in this land. It is a stench of treason, of debasement, of the betrayal of Australian soldiers in the field, of everything that is foul and rotten. It isa stench that emanates from the right honorable member for Barton (Dr. Evatt) the collaborator, masquerading as the Leader of the Opposition.

The CHAIRMAN:

– Order! The honorable member will withdraw that statement.

Mr GRAYDEN:

– I withdraw, Mr. Chairman.

Progress reported.

page 234

ADJOURNMENT

Dairying -Telephoneservices-com- monwealthmotorvehiclesparliamenthouse.

Motion (by Mr. Eric J. Harrison) proposed -

That the House do now adjourn.

Mr PEARCE:
Capricornia

.- I want to discuss the tragic condition of the dairy industry in Queensland. The Queensland Government seems to have the intention of smashing the industry in that State. It is the responsibility of honorable members of this House to ensure that our national way of life shall be maintained. The State Government has deliberately set out to smash an industry that has been built up by the sweat and toil of our forbears. The Australian Government should examine its powers in order to ascertain whether it can prevent the continuance of this attempt. Honorable members have repeatedly heard remarks passed in this chamber concerning the subsidy that the Australian Government promised to pay to the dairy industry. An attempt has been made by honorable gentlemen opposite to convince the electorate that it is the fault of this Government that the Queensland people are being deprived of butter. When the present Australian Government came to office, the subsidy being paid by the previous Government amounted to £5,000,000 per annum. The subsidy being paid at present amounts to £16,800,000, which is more than three times the amount that was paid by the previous Government.

When this matter was placed before the six State Premiers, four of them agreed to pass on to the consumers the increased cost of production. The Premiers of Queensland and New South Wales refused to pass on the increase in full. As a. consequence, the industry is not being given its full cost of production in those two States. This, combined with the fact that the industry is faced with terrible drought and bushfires in Queensland, will mean that people will be forced out of it. The Queensland Government smashed the cotton industry in the early 1930’s and only during the last two yearshas the Australian Government been able to re-establish it. If the Government does not now force the Queensland Government into adopting a common-sense attitude it will become necessary to rebuild the dairy industry as it was necessary to rebuild the cotton industry.

The Acting Premier of Queensland has gone to great lengths to malign the character of Ministers in this House, particularly the Minister for Commerce and Agriculture (Mr. McEwen), no doubt taking advantage of his absence overseas. He has stated that the Minister for Commerce and Agriculture misled him when he informed him of the cost of production. It is rather curious that when the Minister placed this information before the six State Premiers he did not mislead five of them. The only one that he misled was this poor, benighted soul who is the Acting Premier of the State of Queensland. In order to obtain butter in Queensland one has to pay 6s. or7s. per lb. for it on the black market. The Government of Queensland has deliberately fostered that state of affairs. lt has betrayed Labour’s policy towards the dairy industry for many years by lifting the limitation on the production of margarine and by trying to compel people to use margarine instead of butter. As a result of that action this vital industry will bc lost in Queensland and New South Wales. I do not know whether the Government of Queensland is deliberately endeavouring- to abolish the industry or whether its policy represents the sheer stupidity of men who do not know which end of a cow the milk comes from. It has gerrymandered the electorates of Queensland and is now setting about the smashing of the dairy industry. [ wish I could hear the views of thu honorable member for Leichhardt (Mr. Bruce), a previous Minister in the State Government, on this subject. I want to know where he stands. Does he support his ex-colleagues or will he stand by his own constituents whose industry is being smashed by them? I ask Cabinet- to do everything possible to determine what powers the Commonwealth possess to force the hands of the governments of Queensland and New South Wales. Surely no responsible government with the welfare of the people at heart should stand by at this time and see a great industry being “ thrown down the drain “ by a stupid government with no sense of responsibility. If the Australian Government does not take action in this matter now it will soon be too late to do so. This action will affect, not only our way of life, but also community interest throughout the State. No blame can be attached to the Australian Government in connexion with the matter, but I consider that it should endeavour to rectify the position.

T do not know why the Labour party persists with, attempts to ruin primary producers. Wherever it has been in power it has tried, to smash the country man and to throw the cloak of socialism round his shoulders. I ask the Vice-President of the Executive Council (Mr. Eric J. Harrison) to do all that he can to persuade the Government to endeavour to avert the tragedy that is overwhelming a great industry in a great State and to instil some degree of. sense in a government that seems to be bent on hurling its people into misery and despair, on upsetting the lives of the people and, by its tragic blunders, on forcing an industry into extinction.

Mr CURTIN:
Watson

– I wish to put before the House a matter with which the Government can deal if it wishes to do so. On the 2nd November, 1950, 1 asked, as a matter of urgency, that attention be given to the subject of telephone charges to totally incapacitated ex-servicemen. I have not received any information on this matter since. On the 27th August, 1951, nearly eleven months later, I received a reply, which reads as follows : -

X refer to a. question without notice asked by you on the 2nd November, 1950, relative to the granting of some concession in the charges’ for telephone services to totally and permanently incapacitated ex-servicemen.

In my contact with disabled men and women in the several States I have had ample evidence of the handicaps which their disablement imposes upon thom and I appreciate to the full their desire to have telephone facilities available to them, particularly where they feel that they should be able to seek the services of a doctor in emergency.

With this end in view I took the matter up with my colleagues of Cabinet, when the whole of the implications were discussed in deta il-

It took eleven months to discuss them- but I regret to inform you that it was not found possible to provide this additiona facility to those discharged members of the forces who are concerned.

At a time when the Government expects to collect from telephone subscribers and other customers of the PostmasterGeneral’s Department an additional £12,000,000, I make a further appeal on behalf of these unfortunate exservicemen. I have been in communication with the Totally and Permanently Disabled Soldiers Association, and have been informed by the secretary of the New South Wales branch of that organization that there are approximately 1S.000 totally and permanently incapacitated exservicemen in New South Wales alone. I understand that, at the time of the inquiry, the total figures for the Commonwealth were not available. Every facility should be granted to these unfortunate men to lessen the burden imposed upon them as the result of their service in the defence and protection of our great country. Cabinet Ministers must give some practical help to those who have almost given their lives in the service of their country, and are now suffering virtually a living death. Money is apparently no object to this Government. The Treasurer (Sir Arthur Fadden) is taking money from the people with the object of putting it in a place where it will do no harm. I propose that some of that money be put in a place where it will do some good. I ask the Government, in all seriousness, to provide telephones free of charge for all totally and permanently disabled ex-servicemen so that, should the need arise they may be able to call a doctor at will and, by that means, obtain some alleviation of the sufferings caused by their service to their country.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I direct the attention of the House to what the Government appears to regard as a minor matter, but what the taxpayers of this community in general, and I in particular, regard as most important. I refer to the wasteful use of Commonwealth motor cars throughout Australia for the transport of typists, heads of departments and other Commonwealth employees. This matter is all the more important in view of a letter which I received from the Minister for the Interior (Mr. Kent Hughes) in answer to a request I made to him for the inclusion in the list of items of furnishings and equipment made available to federal members of a teledex, a small device worth about 16s. 6d., which enables persons who have to work in offices to refer to telephone numbers more quickly than is possible by scanning the pages of a telephone directory. I was informed by an officer of the department in Adelaide that the issue of a teledex to federal members was not permitted, even though it would enable them to render more efficient service to their constituents. The Minister’s letter, which was dated the 12th July, 1951, reads, in part, as follows : -

I have reviewed the list mentioned, and I am assured by my departmental officers that full consideration was given to the requirements of members when the list was amended earlier this year.

You will appreciate that, in the event of items being added to the existing standard, the costs to the Commonwealth could be quite considerable.

In the” circumstances, 1 am not prepared to approve of any variation of the present list.

In my reply, I stated that I regretted that the Minister had accepted the assurances of his departmental officers instead of basing his decision upon his own personal investigations. I believe that when a member of the Parliament writes to a Minister on any subject, the Minister should give his personal consideration to it, and should not refer it to his departmental officers for their advice. My letter to the Minister continued -

You state in your letter that the cost of adding to the existing standard would be considerable, and yet one can see thousands of pounds of the taxpayers’ money spent each year in providing departmental heads - with almost everything they ask for, including the right to travel by special Commonwealth car all over the country whenever they want to.

I direct your attention, Mr. Speaker, to something which you yourself must have observed in Adelaide. An excellent bus service is provided by TransAustralia Airlines at Parafield aerodrome to convey passengers, who arrive by air, to Adelaide in comfort. However, fleets of Commonwealth cars are sent to the aerodrome to transport typists and departmental heads to the city. If the bus service provided by Trans- Australia Airlines meets the convenience of elected members of this Parliament, surely it should be good enough for typists and other civil servants who now travel by special motor cars. In one particular instance, in Sydney, an elected representative of the people was told by a typist that if he wished to do so, he could accompany her to the city in the motor car which had been sent for her use, and, in that way, save some waiting time. The honorable member replied, “ That will be very good, because I have to call at Manly on my way home. This will enable me to save at least half an hour “. The typist replied, “ I am sorry.

If you want to go to Manly, I shall not be able to take you “. This Government, which claims to be concerned with saving the taxpayers’ money, is permitting that kind of thing to happen.

In a later letter, the Minister for the Interior stated that he would be pleased to have my assistance if at any time I considered that I could assist him to save the taxpayers’ money by reporting individual cases of abuses such as those to which I have referred. I have made personal investigations in regard to this matter. At the Commonwealth transport pool at Adelaide, which is administered by the Minister for Supply (Mr. Beale), I counted no fewer than 29 Commonwealth motor cars which were being cleaned, polished and made ready for the lucky persons who would use them later in the day. I also discovered that no fewer than 22 drivers were employed full time at the pool, and no fewer than 80 vehicles were stationed there. I made inquiries from some of the officers, who admitted that they were required to send cars to Parafield aerodrome to meet Ministers’ typists and officers of various departments. I was also informed that at every week-end two cars were hired to officers of the guided weapons testing range establishment for the use of Mr. McCarthy and others, and that some departmental heads did not return them, at night during the week-ends. I know that you, Mr. Speaker, will sympathize with my attention to this matter, because whatever faults you may have - and like us all you have many - you do not abuse the use of Commonwealth cars and you share my dislike for the abuse of the use of such cars that is taking place in the country at the present time. You have always frowned on the abuse of the privilege of using Commonwealth cars and have set an excellent example in not abusing your own privileges in that regard.

I then sought an opportunity to comply with the Minister’s desire that I should assist him to ascertain the extent of the abuse of the use of Commonwealth cars. I wrote to the officer in charge of the stores and transport at Adelaide of the Department of Supply. In my letter, I asked for permission to examine the job sheets used by that department which showed how various Commonwealth cars had been used during the previous month. That letter was referred to Melbourne, and after a long time had passed I wrote a second letter- in an attempt to discover what had happened to it. In the second letter I informed the officer in charge that I was an elected representative of the people in this Parliament and that I had the responsibility of safeguarding the people’s money against unwarranted abuse. I received a reply to that letter from the Minister at the table (Mr. Beale).

Mr BEALE:
LP

– That was a very polite letter, too.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– Strangely enough, it was a very polite letter; but although it was polite it did not give mc the right to examine the job sheets even though a Minister had asked me to point out any abuses of the use of Commonwealth cars that I might discover. When I asked for permission to try to discover abuses it was refused. In his letter, referring to my request for permission to see the job sheets, the Minister said -

Such practice as far as I hu ve ascertained has not been followed b)’ any Government and

I feel that it would be undesirable to approve of it now.

I sent a further letter to the Minister, to which I have not yet received a reply, although I am still hoping to get one in due course. I said in that letter that I regretted that the Minister had refused to allow me to have an opportunity to check the use of Commonwealth cars by departmental heads and others because that was the only available means that I as an elected representative of the people could use to assist me in my investigations.

Mr SPEAKER:

– Order ! the honorable member’s time has expired.

Mr BEALE:
Minister for Supply · Parramatta · LP

– Unfortunately, I was not here to hear the opening remarks of the honorable member for Hindmarsh (Mr. Clyde Cameron). However, I gather that he placed certain strictures on the Government about the use of Commonwealth cars by typists. The present practice of allowing ministerial staffs to be taken home by car was in operation during the . term of office, of the previous Government. That practice’ lias not been extended by the present Government. Therefore, if what has been done is wrong, and is withholding from the honorable member the privilege of sitting on a nice comfortable car seat instead of a hard bus seat, it is a practice that was followed by the previous Labour Government.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I also mentioned the use of Commonwealth’ cars by departmental officers.

Mr BEALE:
PARRAMATTA, NEW SOUTH WALES · LP

– The same practice is followed in that regard. The honorable member has done enough snooping round, quite improperly.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I protest against and ask for a withdrawal of the statement that I have engaged in improper snooping.

Mr SPEAKER:

– The Minister must withdraw those remarks.

Mr BEALE:

– I shall withdraw the remarks and substitute the statement that the honorable member for Hindmarsh has been engaging in the most abnormal and curious–

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I rise to a point of’ order: It has been ruled to be unparliamentary to say that an honorable member has engaged in abnormal activities.

Mr SPEAKER:

– I ask the Minister to withdraw those words.

Mr BEALE:

– I withdraw them. The honorable member has been engaging in what can be described only as the most extraordinary activity in poking his nose round the transport pool in order to get information. I have1 been informed that be went so far as to ring up a member of the staff of my department and say, “‘Cameron speaking, will you come and have lunch with me ? “ The unfortunate member of the staff, thinking that the “ Cameron “ in question was the honorable gentleman who is Speaker of this House, accepted the invi tation. The House will appreciate how shocked and .disappointed he was when’ he learned which ‘’ Cameron “ had issued the invitation. The honorable member for Hindmarsh then tried to pump this officer in order to obtain information. He should not have done that. Fortunately, the officer had a proper sense of his obligations as a member of the department, and would not have furnished the information to a member qf my party or any other party. He declined to give the information and informed his senior officer of the matter. In due course it was reported to me, and a letter written by the honorable member for Hindmarsh also came to me. I wrote an unnecessarily polite letter in reply to the honorable member, in which I said -

You will recall asking Mr. K. C. Simpson, the Stores and Transport Officer of my department in Adelaide, if he would make available to you for inspection the drivers’ daily log sheets “prepared in connexion with the official cars. This request apparently arose from an earlier discussion you had had with my colleague, the Minister for- the Interior. ‘

T hope you will not mind me mentioning that, in cases such as. this, it is ‘rather embarrassing to a departmental . officer ‘to bc approached direct by a Member of. Parliament. The . more usual practice is for the Member to raise the matter with the Minister concerned who, in this case, is myself.

I .am sorry I cannot agree to…m ,1-ke the departmental records available’ for your inspection.’ Such a practice, so far as 1. can ascertain, has ‘ not been followed by any Gove rnment, and I feel it would be undesirable to approve it now. I. am. however, as anxious; as you are to prevent abuse of Commonwealth transport and if, at any time, you caro to give- any specific case wherein you feel there lias been abuse, J will gladly have it investigated.

That letter, it would seem, enraged him so much that he replied’ in quite’ different terms from those of my letter . He was infuriated because I had cited the practice of the previous Government. I quite understand his attitude because he was left with no answer. If the honorable member can cite a case of the improper use of Commonwealth cars I shall have it investigated. He’ having resorted to pettifogging and irrelevant criticism I. -inform him that members of his own party, are constantly asking me to permit ilium to have the use of Commonwealth cars and to be given additional privileges in regard to Commonwealth cars. 1 inform the honorable member that his way is no.t the way to get such privileges.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– What do such honorable members ask for?

Mr BEALE:

– They ask for transport for honorable members who arc not wi ti tied- to it. We are doing the best we can do. We realize that the business of being a member of Parliament is arduous. If I had my way and economic circumstances permitted me to do so, I’ should be inclined to extend the privileges of honorable members with, of course, the approval of the Government. However, that will certainly not be done as long as I find some honorable members begging for more privileges while others snipe at the Government for doing no more than the previous Administration did. When I assumed control of the Department of Transport, one of the Government’s first acts was to have an inquiry made by an outside body into the1 activities of thu i rans port pool.

Mr Curtin:

– The Yellow Express!

Mr BEALE:

– Yes, an outside body and a. very good body, too. The inquiring authority reported that, under the Chifley Government, the transport pool had beer, carried on with extravagance amounting to something like £200,000 a year. -Since then, we have been trying to reduce the pool and we are, in fact, reducing it. A committee is investigating the extent to which typists, departmental officials and others should be permitted to use official ca rs.

Mr Haylen:

– Why does the Government not give us camels?

Mr BEALE:

– The honorable member for Parkes (Mr. Haylen) does not need a camel; he already has the hump. I repeat that we arc trying to do the best we can do for honorable members and for the taxpayers generally.

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

.- The honorable member for Hindmarsh (Mr. Clyde Cameron) has objected because I would not provide him with a teledex filing system free of charge. As honorable members are aware, certain equipment is provided free of charge in members rooms, but a teledex filing system is not included in it. There will be general agreement, I am sure, that the offices provided for honorable members are adequately furnished. The equipment in each office includes a telephone, and honorable members have the right to send telegrams from their telephones. That privilegeis quite justified provided it is not abused. In addition, of course, honorable members have secretarial assistance. If the honorable member for Hindmarsh wishes me to give a full account of what I have done as Minister for the Interior to remind certain honorable members, including some of his own colleagues, of the need to be reasonable in their demands, I shall do so. It has come to my notice that some honorable members - from both sides of the House, I may say - are not making what may be regarded as reasonable use of federal members’ stationery. This may be due to the fact that no definite regulations have been laid down. 1 shall not mention any names, but I inform the House that. I- have a list of uses to which this stationery has been put. It includes the notification of the official result of a guessing competition held at a certain town hall. The first prize for the competition was £10 and the consolation prizes a ticket in a. lottery. Official stationery has been used also to give notice of political meetings at various centres. It is obvious that there must be some limit to the privileges to which honorable members arc entitled.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– A teledex filing system would cost only 16s. 6d.

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– For 120 members of this chamber, the expenditurewould be considerable. Honorable members must bc reasonable if they wish to retain their privileges, and I urge every honorable member to exercise his discretion, otherwise the Minister for the Interior may be forced to take a hand in the matter.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– What about the 80 cars in the Adelaide transport “pool?

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

– The Adelaide transport pool is under the control of the Minister for Supply (Mr. Beale), who has already replied to the honorable member. I shall not repeat what the honorable gentleman has said. If the honorable member wants instances of what I have done, I shall be pleased to supply details to the House, but I am sure he will be sorry if he asks for them.

Question resolved in the affirmative.

page 240

PAPERS

The following papers were presented : -

National Debt Sinking Fund Act - National Debt Commission - Twenty-eighth Annual Report, for year 1950-51.

Public Service Act - Appointments - PostmasterGeneral’s Department - P. T. Bason, K. W. Hix, A. R. M. Langley, R. G. Smart, R. O. Smith, F. H. Thornley.

Public Service Arbitration Act - Determinations - 1951 -

No. 64 - Australian Broadcasting Commission Staff Association.

No. 65 - Federated Clerks’ Union of Australia.

No. 66 - -Postal Overseers’ Union of Australia.

No. 67 - Hotel, Club, Restaurant and Caterers Employees’ Union of New South Wales, and Federated Liquor and Allied Trades Employees’ Union of Australasia.

No. 68 - -Transport Workers’ Union of Australia.

No. 69 - Commonwealth Medical Officers’ Association.

No. 70 - Postal Overseers’ Union of Australia.

No. 71 - Commonwealth Storemen and Packers’ Union of Australia.

No. 72 - Hotel, Club, Restaurant and Caterers Employees’ Union of New South Wales,and Federated Liquor and Allied Trades Employees’ Union of Australasia.

No. 73- Federated Clerks’ Union of Australia.

No. 74 - Commonwealth Legal Professional Officers’ Association.

No. 75- Professional Officers’ Association, Commonwealth Public Service.

No. 76 - Federated Clerks’ Union of Australia.

House adjourned at 11.15 p.m.

page 240

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Civil Aviation.

Royal Australian Air Force

Mr Fairbairn:
FARRER, NEW SOUTH WALES

n asked the Minister for Air, upon notice -

  1. Is it a fact that the Sabre jet aircraft to be manufactured in Australia is to be armed with machine guns of . 5-in. or 13-mm. bore?
  2. In view of the fact that the Royal Air Force has armed its fighters for the last ten years with 20-mm. cannon and as it is reported that the Russians have a 30-mm. cannon in their fighters, will he consider arming the Sabre with 20-mm. cannon?
Mr McMahon:
LP

– The answers to the honorable member’s questions are as follows : -

The armament which it is proposed to install in the Australian Sabre jet aircraft is secret. The honorable member may rest assured that the Australian Sabre will be equipped with the gun proved most effective by recent operational experience.

Cite as: Australia, House of Representatives, Debates, 2 October 1951, viewed 22 October 2017, <http://historichansard.net/hofreps/1951/19511002_reps_20_214/>.

View PDF View XML View in Voyant