House of Representatives
16 May 1956

22nd Parliament · 1st Session

  1. House of Representatives
  2. 22nd Parliament
  3. 1956

Mr. Deputy Speaker (Mr. C. F. Adermann) took the chair at 2.30 p.m., and read prayers.

page 2079

QUESTION

CYPRUS

Dr EVATT:
BARTON, NEW SOUTH WALES

– I ask the Prime Minister a question relating to the tragic situation that still exists in Cyprus, affecting the United Kingdom and the people of Cyprus, many of whom have relatives in Australia, and also affecting Greece, which country was perhaps the most stalwart ally of Great Britain and the British Commonwealth during the greatest crisis of the war in Europe, when Greece was directly affected. I do not make any analysis of causes of the present situation, nor do I assign any blame to any group of people or any power. However, in the interests of Australia and of its close relationships with these nations and their peoples, will the Prime Minister and his Government consider Australian intervention in the matter? I refer not r,o intervention in the United Nations, where ultimately this matter may be referred, after many months have elapsed, but to direct approach to the governments affected, particularly to those of Britain and Greece, in order to determine whether Australia can make any contribution towards reconciling the parties concerned on, some basis of justice. All the nations directly affected have important interests in Cyprus, and if nothing constructive is done to effect a settlement the present situation can lead only to much suffering and tragedy and many deaths, after which there will be some sort of an amnesty. It is not without precedent for Australia to take the initiative in a matter of this kind, and I suggest to the Prime Minister that he might do so, with the assistance of the Minister for External Affairs. Certainly such an action would find support among all sections of this House and of the country.

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– I do not want to reject out of hand the idea of some views being offered on these matters, but I do not need to tell the right honorable gentleman that this matter is one of great delicacy. I had the opportunity of discussing it with members of the Greek

Government about a year ago, in the somewhat earlier phases of the movement in Cyprus. Nor do 1 need to tell honorable members that the position of Cyprus in the Middle East is one of vast importance, not only to the United Kingdom, but also to Australia itself. Nor, indeed, would I need to say that several countries are deeply interested in this matter. We should all like to see sensible and peaceable arrangements made hut, of course, such arrangements require at least two co-operating parlies, and up to now there have been difficulties which, I venture to say, have not been of the making of the United Kingdom Government. I shall be very happy to continue with my colleague., the Minister for External Affairs, the discussions that I have had from time to time since this unhappy situation commenced to develop, and whatever influence Australia has will, as usual, be on the side of peace and sensible, settlement, and with a view to the preservation of security.

page 2079

QUESTION

MINISTERIAL AND ADMINISTRATIVE ARRANGEMENTS

Mr HAMILTON:
CANNING, WESTERN AUSTRALIA

– My question is directed to the Prime Minister. I wish to preface it by saying that the House is grateful to the right honorable gentleman for notifying it at various times of changes in the administration of departments. Honorable members will recall his recent advice concerning the departmental change in the administration of the War Service Homes Act. I ask the Prime Minister whether this announcement appeared in the Commonwealth Gazette of Friday, the 27th April, 1956, under the Administrative Arrangements Order issued by the Governor-General. In this Administrative Arrangements Order did there appear also a notification concerning a change in the administration of the War Service Land Settlement Agreement Act 1945, and Division 2, Part II., of the Ee-establishment and Employment Act? Had those two alterations been announced to the House? As few honorable members receive the Commonwealth Gazette, and some time elapses before the Federal Guide is compiled, printed and distributed, will the Prime Minister, in order to facilitate the working of this House and to keep honorable members informed, lay down as a practice or principle that all such changes shall be made known to the House or, alternatively, that honorable members shall be notified of them by circular?

Mr MENZIES:
LP

– I think that the honorable member is right. I regret to say that he has confirmed my own impression that the Commonwealth Government Gazette is not popularly read. In future, I will see that any changes in administrative arrangements are announced in the House. So that there will be no misunderstanding of what has occurred, perhaps I should state the administrative changes which have been approved. The administration of the war service land settlement legislation has, for reasons that are clear enough, been transferred to the Minister for Primary Industry. The administration of the war service homes legislation has been transferred from the Minister for Social Services to the Minister for National Development. That has already been announced by my colleague. The Minister for Social Services will carry out the necessary representational duties in this chamber. The administration of Division 2 of Part II. of the Reestablishment and Employment Act, which deals with preference in employment, has been transferred from the AttorneyGeneral to the Minister for Labour and National Service. Certain problems associated with the exact delineation of the functions of the Department of Trade and the Department of Primary Industry remain unsettled. As honorable members will appreciate, there has been a great complex of matters to examine, and what one of my colleagues would call the “surgery” of the matter is not easily accomplished. An announcement to the House on the matter will be made as soon as possible. I should, perhaps, take the opportunity presented by this question to say that during the absence from Australia of the Minister for Trade and myself, which honorable members will be delighted to know will shortly occur-

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– I hope that it will be a long absence.

Mr MENZIES:

– So do I. For the first and only time, the honorable member for East Sydney expresses the very thoughts within my bosom. During our absence, long or short, the Treasurer will act as Prime Minister and the Minister for Primary Industry will act as Minister for Trade. The Minister for Customs and Excise will, during my absence, represent the Attorney-General in this chamber.

page 2080

QUESTION

AUSTRALIAN FLAG

Mr CALWELL:
MELBOURNE, VICTORIA

– I wish to ask the Prime Minister two questions. Will he lay on the table the tentative rules that he has approved for the guidance of those flying the Australian flag ? Secondly, will he have these excellent rules printed and circulated in pamphlet form for the information of honorable members of both Houses of this Parliament, and all persons interested, so as to help make certain that the Australian blue ensign, now the national flag of Australia by law established, is treated in Australia at all times with the respect it deserves and in the same way as the flags of other nations are accorded respect in their respective countries ?

Mr MENZIES:
LP

– Yes. I shall be glad to have that done. It may be done in my absence but it will certainly be done before the House rises.

page 2080

QUESTION

DISARMAMENT

Mr BOSTOCK:
INDI, VICTORIA

– Can the -Minister for External Affairs give any information on the significance of the report that the Soviet Union is prepared to reduce its armed forces by something over 1,000,000 men in the next twelve months?

Mr CASEY:
Minister for External Affairs · LP

– Yes, sir. There has been a report, apparently genuine, to that effect. I think that it referred to a reduction of 1,200,000 men in the armed forces generally of the Soviet Union before May of 1957. All I can say is that one must, of course, welcome any move that reduces the very great disparity between the armed forces of the Soviet Union and those of the principal democracies. But I would say that, even after this reduction of nearly one and a quarter million mcn has been made, the total of the armed forces of the Soviet Union will be ar least 4,500.000 mon. Honorable members know enough of the relevant figures for the United Kingdom and the United States of

America to know what a vast disparity will exist even after these reductions are made. Disarmament proposals have been going along for a very considerable time, and they have stuck, as I think honorable members are generally aware, on the proposition of the democracies that this subject will not be resolved until there has bren an agreement on proper mutual, inspection of the armed forces, both orthodox or otherwise, on each side - the Communist side and the democratic side. Of course, there is no sign of agreement on that basic consideration on which the solution of this vastly important problem of international disarmament, or reduction of armaments, depends.

page 2081

QUESTION

FORGED £5 NOTES

Mp. CLYDE CAMERON.- Is the Treasurer aware that the members of several unions in South Australia have refused to accept £5 notes as payment of wages? Is he aware that there is an increasing resistance on the part of the general public to accept £5 notes as legal tender? Is it true that the number of forged £5 notes that have been detected is greatly in excess of the number published in the press? If this is so, is the Government prepared to reconsider the previous refusal of the Treasury to withdraw the £5 notes from circulation and to issue new ones?

Sir ARTHUR FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

– I have no knowledge of the facts disclosed by the honorable member for Hindmarsh - if they are facts - with regard to the refusal of members of certain unions to accept £5 notes for wages. I shall have that aspect, and the other aspects of his question, examined, and will supply him with an answer.

page 2081

QUESTION

COAL

Mr DEAN:
ROBERTSON, NEW SOUTH WALES

– I desire to ask the Minister for Labour and National Service a question concerning the meeting that was held in Sydney last Monday of parties interested in the coal-mining industry. Was the Minister represented at that meeting? Has he any information to give to the House concerning the progress made? Did the conference discuss ways of securing new markets for coal?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– This was the first meeting held of the committee set up as a result of a conference a little earlier in Sydney which my colleague, the Minister for National Development, and I attended. On this occasion my colleague presided over the committee and, in that sense, the Government was very directly represented. There were also present, I gather, representatives of the Joint. Coal Board and the Department of National Development. The Department of Labour and National Service was represented by an assistant secretary, Mr. Graham. I understand that the first meeting of the committee set out to lay down the terms of reference in rather more detailed form, and then to decide which matters might be regarded as occupying first priority for its consideration. It was agreed that, so far as practicable, the committee would proceed on the basis of the factual material supplied by the Joint Coal Board. The first four subject-matters which it was agreed. to discuss were: The markets for New South Wales coal; possible alternative uses for coal; the incidence of industrial disputes; and coalloading facilities at Newcastle. It is expected that the next meeting will take place about three weeks bence. 1 am assured by my colleague that the first meeting was conducted in a co-operative atmosphere, and that a good spirit was manifest. He is very hopeful that some useful developments will come out of the work of the committee.

page 2081

QUESTION

ROYAL PRINCE ALFRED HOSPITAL REHABILITATION CENTRE

Mr MORGAN:
REID, NEW SOUTH WALES

– Is the Minister for Health aware that a committee of responsible and public-spirited citizens is endeavouring, in conjunction with the authorities of the Royal Prince Alfred Hospital, Sydney, to raise funds to establish a modern rehabilitation centre for disabled persons, in particular those who cannot obtain rehabilitation benefits through the existing centres of the Department of Social Services, because they are not recipients of social services benefits? Only pensioners and similar recipients of social services benefits are eligible for rehabilitation benefits. So far, I understand, a sum of about £14.000 has been raised towards the first objective of £100,000 to equip this centre. The hospital will make a building available, but the equipping and maintenance of it are to be the responsibility of the committee. As this proposed centre will be the fust of its kind in Australia, and will be in line with the most up-to-date schemes in operation overseas and, incidentally, in keeping with the Government’s pronounced policy as indicated by the Minister’s predecessor, of encouraging self hell)-

Mr DEPUTY SPEAKER:

-Order! The honorable gentleman is giving information now.

Mr MORGAN:

– Will the Minister be good enough to look into this matter sympathetically, as I feel sure he will, with a view to ascertaining whether some Commonwealth assistance could be granted in respect of it - say, on a £l-for- £1 basis - in order that the centre may be opened as soon as possible for the benefit of this deserving section of the community ?

Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– I am aware of the matter raised by the honorable gentleman. He will be glad to know that I have recently visited the Royal Prince Alfred Hospital in Sydney and had the opportunity of seeing this centre and discussing with the hospital authorities the very excellent arrangements being made. As the honorable gentleman points out, this is not a duplication of what is being done by the Department of Social Services, but is a completely separate project. 1 shall give the matter my consideration, although I can make no promises to the honorable gentleman.

page 2082

QUESTION

MALAYAN CONSTITUTIONAL COMMISSION

Mr DOWNER:
ANGAS, SOUTH AUSTRALIA

– My question is to the ight honorable Minister for External Affairs. Can the right honorable gentleman give the House any information about the reported breakdown of talks in London concerning the constitutional future of Singapore ? Is the Australian Government being kept fully informed of the progress of these negotiations?

Mr CASEY:
LP

– Answering the last part of the question first, yes, the Government has been kept intimately informed at all stages of the discussions in London. In respect of the first part of the question, I propose to seek leave of the House to make a statement on the breakdown of the Singapore talks in London.

page 2082

QUESTION

FORGED £5 NOTES

Mr J R FRASER:
ALP

– My question to the Treasurer is, to a degree, supplementary to that asked by the honorable member for Hindmarsh. I ask the right honorable gentleman: Has it been established that the forged £5 notes now circulating in several States of the Commonwealth are being produced by non-union labour ; or has it been clearly shown that the forger has obviously served a very complete apprenticeship in this trade ?

Sir ARTHUR FADDEN:
CP

– I am not aware of the facts concerning the question. If the honorable gentleman could supply any information 1 should be very pleased to receive it.

page 2082

QUESTION

IMMIGRATION

Mr FOX:
HENTY, VICTORIA

– I preface my question to the Minister for Immigration by stating that I have been informed that a number of immigrants who have purchased land in Melbourne have expressed surprise and dismay on receipt of an account from the Melbourne and Metropolitan Board of Works for outstanding rates. What action is taken by the Government to warn immigrants against exploitation when they are purchasing land or houses in Australia? For example, are they warned against the possibility of buying land on which rates or other charges may be owing to the Board of Works or other authorities? Will the Minister state what steps are taken generally to protect immigrants against the pitfalls that may he involved in buying land or building?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– The Department of Immigration has taken a number of practical steps over recent years to warn immigrants who are contemplating the purchase of land or buildings. Those steps include the issue of a factual pamphlet to the immigrants, in their own languages. before they embark for Australia. When they arrive here, they are given a booklet dealing with all aspects of building. It is issued and distributed widely through the Good Neighbour councils and local government authorities. The booklet, which is entitled Budding a Home, was prepared with the co-operation of the Royal Australian Institute of Architects and local government authorities. In addition, posters, printed in English and in foreign languages, have been issued for a number of years through the branches of the Good Neighbour movement and local government authorities to warn immigrants always to consult the relevant local government authority, to deal with reputable estate agents, and to consult ii solicitor. From time to time, the department has supplemented this information with articles in its monthly journal, The Good Neighbour. The Good Neighbour movement also distributes information direct to immigrants through advisory committees. Doubtless, we do not reach every immigrant in this way, but the honorable gentleman will realize that we are doing what we can to bring home to them the pitfalls to be avoided in making such an important decision. I should welcome further advertisement by honorable members of the availability of this information.

Mr GALVIN:
KINGSTON, SOUTH AUSTRALIA

– I direct a question to the Minister for Immigration concerning r.he recent return to Germany of a young New Australian girl who was reported to be suffering from a tumour on the brain, and whose fare to Germany for the purpose of having an operation waa raised by public subscription in South Australia. Will the Minister communicate with officials of his department in Bonn to ascertain whether it is correct that propaganda is being circulated in Germany to the effect that intending migrants should give serious consideration to any proposal to go to Australia because competent medical attention is not available in this country, and that they would need to have sufficient money to return to Germany, if necessary, for certain medical treatment? Is the Minister aware that the treatment suggested for the condition diagnosed by the German professor is reported to be exactly the same as that given by medical authorities in South Australia, and that no operation is required? After satisfying himself about these facts, will he ask his departmental officials in Germany to make the correct story known, so that no further misrepresentation will be made in that country!

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– It would, indeed, be unfortunate if the warmhearted help given by citizens of South Australia in this unhappy case to enable the child to be treated by a doctor in Germany, in whom J understand the family had some special confidence, were interpreted overseas as indicating a lack of confidence, on our part or their part, in Australian medical services. If such propaganda has been published in Germany, 1 shall ascertain what suitable action can be taken to counteract it. I shall inquire into the matter.

page 2083

QUESTION

MURRAY VALLEY PRODUCE

Mr FAIRBAIRN:
FARRER, NEW SOUTH WALES

– Has the Minister for Trade been informed that the Murray Valley Development League is considering putting on, during the Olympic Games in Melbourne, a display of the produce of the Murray Valley? As such a display could well increase sales overseas, would the Minister consider making a grant towards the cost of this display, so as to enable it to be made as comprehensive as possible?

Mr McEWEN:
Minister for Trade · MURRAY, VICTORIA · CP

– I am not aware that the proposal has reached me. Perhaps it has reached the department without yet getting through to me. I would regard it as an interesting, and no doubt valuable, proposal. On the other hand, many suggestions are coming forward now, doubtless almost without exception of value, on how we might get additional publicity for our Australian produce to enhance its sale opportunities overseas. These suggestions must be considered within the limits of the funds that the Parliament has voted for this purpose. The final decision is made sometimes at departmental level and sometimes by myself, but always after weighing fully the judgment of those persons who are most expert to form an opinion on such a matter as by which expenditure we shall receive most value for our money, having in mind the object in view.

page 2084

QUESTION

ALUMINIUM

Mr BARNARD:
BASS, TASMANIA

– I direct a question . to the Minister for Supply. I refer to the statement in which the Minister laid great stress on the importance of the Bell Bay aluminium plant, and in which he emphasized that the works had commenced production “ only just in time “ to meet the needs of Australian industries following a reduction of overseas supplies. He stated further that the plant is now producing approximately one-half of Australian requirements. I ask the Minister whether, in view of his statement, he is now prepared to give early consideration to the expansion of the industry as more power becomes available, not only to achieve an increased production of aluminium, but also for the establishment of prefabrication plants to be used in conjunction with the production of ingots.

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

– I shall take the last part of the honorable gentleman’s question first. For myself, I arn not prepared at the moment to consider extending the activities of the Bell Bay project to include fabrication. The reason for that has been stated several times in this House and in communications to the Premier of Tasmania, as the honorable gentleman knows. That reason is that there is an ample fabricating capacity in Australian industry. The honorable gentleman may shake his head but he will permit me to differ from him in that respect. The answer to the earlier part of his question is also “ No “, for the very reason which he has indicated in the question. It would be foolish at this time to consider expanding production at Bell Bay when we are not certain that we can obtain enough power for the maximum production of which the plant is now capable, so there can be no question of extending the plant until a great deal more electric power is available.

page 2084

QUESTION

LIMITATION OF IMPORTS

Mr TURNER:
BRADFIELD, NEW SOUTH WALES

– My question is directed to the Minister in charge of the Commonwealth Scientific and Industrial Research Organization. Is the right honorable gentleman aware that from time to time the arrival from overseas of research equipment required by the Com monwealth Scientific and Industrial Research Organization is delayed by reason of the imposition by the Department of Trade of a quarterly quota or limit on such imports? The significant word is “quarterly”. If the Minister is not aware of the situation, will he make some inquiries with a view to putting Australian scientific workers on a fair competitive footing with similar research workers overseas ‘(

Mr CASEY:
LP

– All I can say is that the situation that the honorable gentleman describes as existing has not been brought to my notice by the executive of the Commonwealth Scientific and Industrial Research Organization, but I shall certainly have the matter inquired into.

page 2084

QUESTION

WAR SERVICE HOMES

Mr L R JOHNSON:
HUGHES, NEW SOUTH WALES · ALP

– I direct u question to the Minister for Social Services, who represents in this House the Minister for National Development, who is Minister in charge of the War Service Homes Division. Will the Minister indicate whether ex-servicemen employees of the Commonwealth Public Service are afforded any priority in the matter of second assistance from the War Service Homes Division, following transfer of employment, at departmental request, from one city to another, or from State to State? Does the Minister agree that, if no priority were afforded for second assistance, many public servants would reject transfer proposals, even where promotion was involved, for reasons of accommodation difficulties? Since the matter involves the efficient deployment of Commonwealth public servants, as well as the welfare of a large number of ex-servicemen, will the Minister indicate the degree to which the Government has faced, or will face, its obligations in this matter?

Mr ROBERTON:
Minister for Social Services · RIVERINA, NEW SOUTH WALES · CP

– Let me say, in reply to that part of the question which J heard that, when I had charge of the War Service Homes Division, the number of applications for second assistance was so great, and. in my opinion, was so much to the prejudice of the 30,000 applicants who were waiting for first assistance, that, since the discretion rested with the Minister, I decided that applications for second assistance should be rejected for the time being, except in cases of extreme emergency. What the position is since the division has passed to the administration of the Minister for National Development, I am not in a position to say, but I shall ascertain from him whether there has been any alteration.

page 2085

QUESTION

SINGAPORE CONSTITUTIONAL CONFERENCE

Mr CASEY:
Minister for External Affairs · La T robe · LP

– by leave-The Australian Government has learnt with great regret that the Singapore delegationhas been unable to agree to constitutional changes proposed by the United Kingdom for the granting of increased selfgovernment to Singapore. The United Kingdom offered a high and immediate degree of self-government to the elected representatives in Singapore. It proposed complete control of the island’s own affairs, except for defence and external relations, which were not in dispute, with the United Kingdom retaining some rights to take necessary and, possibly, early action to maintain internal security. The United Kingdom offer was not accepted, mainly because of the unwillingness of the Singapore delegation to agree to the United Kingdom authorities having the powers which would allow them to take early action to prevent the development of threats to internal security before the situation gets beyond recall. I happen to have had experience myself of civil disturbance in another country in respect of which I was in a position of personal responsibility. One of the lessons that I learnt beyond any possibility of misunderstanding was that, unless civil disturbance is coped with in its very early stage, it can - and almost always does - very rapidly get out of hand and become unmanageable by means other than the employment of overwhelming forces - ifsuch forces exist - and this will be accompanied by great casualties and very great public distress.

The threat of organized Communist subversion in Singapore is serious. Highly organized Communist groupsare infiltrating politicalparties, trade unions and schools with the aim of secur ing complete control of Singapore. Furthermore, Singapore, on its own, does not at present possess anything like adequate means of maintaining social stability and internal security. If the United Kingdom had abdicated this responsibility, the consequences could have been disastrous for the population of Singapore. If the existing prosperity of the island is to be maintained, it is essential that there should be in the public mind no doubts about the ability of the authorities to keep the peace and to stop organized rioting and the like at the instance of professional troublemakers. The continued existence and expansion of Singapore as a. great commercial centre is dependent upon the maintenance of confidence in its internal and external security. The destruction of this confidence would inevitably lead to catastrophic unemployment and destitution and to the flight of industry and commerce, to the vast detriment of the ordinary people of Singapore.

Australia has followed recent Singapore developments with close and sympathetic interest. We do not regard the failure of the present talks as a permanent check to constitutional advances in Singapore. It should be remembered that the United Kingdom has always adhered to the healthy and liberal practise of encouraging the gradual evolution of a territory to progressively greater charge of its own affairs. Examples of this are world-wide and the process is by no means ended, as is well known.

This process provides an opportunity for its people to acquire the experience necessary for the efficient conduct of the business of government in an unhurried but by no means protracted manner. There are very considerable dangers, however, in a too-precipitate advance towards self-government, and nowhere are these dangers more apparent, and indeed obvious, than in the case of Singapore. We believe that a recognition of the paramount need to defend the island is essential. Its people can only look forward to continued progress in their welfare and to the enjoyment of an increasing degree of self-government if their security against internal subversion and external aggression is ensured.

What I have said adds up to this : The Australian Government supports the course that has been adopted by the United Kingdom Government in face of the unwillingness of the Singapore delegation to accept minimum safeguards for preserving the internal and external security of Singapore - safeguards which are as much in the interests of the Singapore people themselves as in the general interest.

In order that the House may have the fullest information available to the Government on this subject, as well as tabling the statement that I have just made I should like to table a statement made available to the Government by the United Kingdom High Commissioner’s office in Canberra, being a description by the United Kingdom Government of the course of the negotiations and the attitude taken by both sides at the recent conference in London.

I lay on the table the following papers : -

Singapore Constitutional Conference -

Ministerial Statement. Summary of Negotiations and Proceedings, prepared by the United Kingdom Government.

Dr EVATT:
Leader of the Opposition · Barton

– by leave - I should like additional facts from the Minister for External Affairs (Mr. Casey). Has the Australian Government participated in the negotiations throughout the proceedings? The right honorable gentleman indicates Australian agreement with the decision, but was that intimated to the United Kingdom Government before the final breakdown?

Mr Casey:

– We have had frequent telegraphic exchanges.

Dr EVATT:

– Giving the opinion of the Australian Government?

Mr Casey:

– The opinions of the Government have been brought to the notice of the United Kingdom Government on numerous occasions.

Dr EVATT:

– We may take it that it is not merely the result that the right honorable gentleman is commenting upon, but the course of the negotiations. This matter is too important to be dealt with by a short statement, but I want to make one or two points quite clear. Mr.

Marshall is the Chief Minister of Singapore, and I fear that what has been done will make his task practically impossible. He has agreed that defence and external affairs - two vital powers - are not to be part of the area of self-government to be conferred. I understand that that is so. The breakdown occurred simply because his Government will not be permitted to control what the Minister describes as power to deal with internal stability or power to prevent the development of threats to internal government. The only point I want to make to the right honorable gentleman is that that is of the very essence of internal selfgovernment. A charter of self-government of any kind could not be given without that power. Even in colonial days, when the power in its first stage was too tiny, the power to deal with internal difficulties before external sovereignty was granted was given, or almost always given. I do not want to develop the point. I have not read the full document from the High Commissioner of the United Kingdom, but on those facts it seems to me, in effect, a denial of the essential right of internal self-government, without which there could not be in reality a government of Singapore by the people of Singapore.

Mr Casey:

– I hope the right honorable gentleman does not make up his mind finally at this stage.

Dr EVATT:

– That is the impression it gives to me, and I think there should be fuller information. I should like the Minister to furnish to the House, not necessarily the documents themselves, but. the points of view put by the Australian Government, and those put, if anywere put, by any other government. It seems to me at present, on the facts that are before me, that there has been an interferencewith the policy that had already been announced, and upon which Mr. Marshall was elected Chief Minister of the Singapore Government. There is a danger, not only to Singapore, but also to all the other countries in the British Commonwealth, in a niggardly approach to such a question as this. Is not Mr. Marshall capable of looking after the internal security of his own country? That is the point, and it is a most important point for this House to consider.

Mr CASEY:
Minister for External Affairs · La Trobe · LP

– by leave - 1 should not like the statement of the Leader of the Opposition to go .unanswered, even for a short time. I feel sure that when the right honorable gentleman has had an opportunity to read the papers that have been made available to him, and to think over this matter more carefully, he will not wish to be committed to the statement that he has just made. The nub of the whole discussions in London was internal security. I shall not develop the subject at any great length now, although it may be advisable to do so on a later occasion, but I assure the right honorable member that there has been nothing in the least capricious in the attitude of Her Majesty’s United Kingdom Government towards this matter. The subject is not anything like as simple as the right honorable gentleman has just made it appear to be. It is quite true that the Singapore authorities were willing to delegate the defence power and the external affairs power to the United Kingdom, but it is also true that the defence power is meaningless unless it is linked with ability to maintain internal law and order. A very large force of local labour has to be employed by the British defence establishments on the island of Singapore. I shall not go into the matter of the political affiliations of those men, of whom there are some tens of thousands, or of the unions to which they belong, but if the defence power in the hands of the United Kingdom Government is to have any meaning at all, it must be linked with an ability to maintain internal security. If that were not so, the whole of the conference in London would not have hinged on this question of the control of internal security. However, this is not, I think, the appropriate time for us to attempt to debate the subject, and I merely make a plea to the right honorable member not to make up his mind superficially on this matter, which is not, I venture to say, in any way in accordance with the statement i h nt he has just made to the House.

page 2087

QUESTION

DEFENCE PROGRAMME EXPENDITURE

Sir PHILIP McBRIDE:
Minister for Defence · Wakefield · LP

– by leave - Honorable members will be aware of the recent public reports on the evidence given before the Public Accounts Committee, concerning the under-expenditure by the Service departments of their votes for 1954-55, and the payment of certain amounts to a trust account. Naturally, it is not appropriate for me to anticipate the reports of a committee appointed by the Parliament to report to it but, since the evidence has been the subject of critical public comment, I wish, in the meantime, to keep the record accurate. The Government, including the Ministers responsible for the administration and expenditure of the respective departmental allotments of the defence vote, will welcome any observations for improvement that may be made by the committee. But, as will be seen from my explanation, there are very sound reasons for the amount voted for defence in recent years. There are also proper explanations of the underspending that has occurred, and of the use of a trust account to make provision against liabilities within- the programme which are carried forward to future years. I, therefore, wish to inform the House of the general background of these matters from the overall aspect of the defence programme and the vote.

The Government’s defence policy and the degree of defence preparedness are dependent upon an assessment of the international situation and the consequent risks, and the amount of expenditure which can be devoted to defence whilst maintaining a stable economy. These factors are under constant review. Based on these considerations, the Government’s defence advisers submitted for approval a balanced defence programme of objectives over the three years 1954-55 to 1956-57, to give effect to the Government’s policy.

In February, 1954, the Government adopted a series of measures for rebalancing the defence programme with a vote not exceeding £200,000,000. In the case of the Army, where there was a disequilibrium between man-power and equipment, it. was decided that the proportion of capital expenditure for equipment and production capacity should increase and that nf maintenance expenditure should be reduced. The Government accordingly decided to supplement the provision in the Army programme for deficiencies in equipment by increasing the total of the programme for 1954-55- £190,400,000 - by £9,600,000. Consideration was to be given later in the financial year to the transfer of this amount to the Defence Equipment Trust Account. Parliament was informed of this additional provision in my statement of the 28th September, 1954, on “Defence Policy and the Programme “. During the year, an amount of £2,300,000 was spent, leaving an unexpended balance of £7,300,000. This was absorbed in the amount of £S,000,000 which was subsequently appropriated by the Parliament in the additional Estimates for credit to the trust account. The sum of £S,000,000 was considerably less than the unexpended balance of’ £22,500,000 on the total defence vote.

I would emphasize that the amount of £9,600,000 was not surplus to Army requirements. In fact, there are deficiencies in Army equipment to a much greater amount, for which provision still remains to be made. It will be the aim of the Government to continue its policy of improving the equipment of the forces within the resources that can be made available for this purpose.

The total expenditure in 1954-55 from the defence vote of £200,000,000 was £177,500,000, excluding the amount of £8,000,000 paid to the trust account, which I have already explained.

The chief causes of the underexpenditure were -

  1. In the prevailing state of the economy, with full employment and the inability of supply to meet demand, there has been a shortage of man-power avail-, able to the defence sector for building up the strengths of the forces and civilian staff, and of man-power and materials for the local production of the material requirements of the services and the execution of defence works.
  2. There have also been delays m deliveries of equipment and supplies from overseas sources, involving substantial outstanding amounts budgeted for expenditure in the financial year.

The problem that faces departments, in the preparation of their annual estimates, is the rate at which outstanding commitments will be brought to account in conjunction with other current annual expenditure. They act on the best advice that they can obtain from those responsible for the supply of goods or the completion of works. They also have to assess the rate of wastage in their forces and the prospects of recruitment. There is no reckless over-estimating. The known factors are the annual cost of maintenance and the outstanding commitments which must be brought to account sooner or. later. The basic problem is, therefore, the best estimate that can be made of what amount will be required to meet them in each financial year. The difficulties of estimating the amount of defence expenditure that can be achieved in a particular financial year are not unique to Australia. They are also encountered in other countries that work on a system of annual parliamentary appropriations, and are due in a large degree to the many unpredictable factors arising in the course of the financial year, which would not be foreseen when the Estimates were originally prepared.

As indicated initially, the considerations I have outlined are furnished from the overall aspect of the defence programme and vote. When the reports of the Public Accounts Committee are received, service Ministers will be in n position to comment on any views that may be expressed in respect of their departments. I would add that the Government appreciates the work that thi? committee is doing, and will welcome any suggestions for improvement that it may make.

Dr EVATT:
Leader of the Opposition · Barton

– by leave - I do not wish to detain the Hn,ise for long, but I must point out a few facts. As the Minister has, in effect, admitted, his statement arises from a statement that was made to the Public Accounts Committee by the present Auditor-General. Mr. Newman, and reported in the press on Monday, the 26th March last. Mr. Newman was previously Assistant Secretary in the .Defence Division of the Department of the Treasury. According to the press report, he said that when the officers of his division of the Treasury were notified that Cabinet had reached the conclusion that the defence vote should be £200,000,000, as in the previous year, there was less than 24 hours in which to get the estimates for the Army, Navy, Air Force and the Department of Defence to Canberra for inclusion in the budget.

May I interpolate here that what the Minister has not appreciated- is that the figure put down in the defence estimate affects the budget position, lt affects the taxation that may have to be levied, as well as social services payments and other outgoings. Therefore, it is not merely a question of guessing, or estimating a number without the benefit of the precise recommendations of the responsible officers. The estimates of the defence departments had reached £191,000,000. So, to meet the Government’s requirement, that figure had to be increased by £9.000,000. According to the press report, Mr. Newman told the Public Accounts Committee that, on his own responsibility, he included the £9,000,000 in the major Army votearms and armaments - because he thought that the trend was towards the expenditure of money upon tanks and other heavy equipment. He said that he feltthat that was the only vote to which, with justification, it could be added, if Parliament were to appropriate the full amount of £200,000,000. So, as far as the Government was concerned, it seems clear that there was no real pre-estimate of the amount that was really referable to the Army. It was a question of getting up to the round figure of £200,000,000, and that was the way in which it was done.

I do not wish to anticipate any finding of the Public Accounts Committee. I merely point out that the answer to the Minister is contained in his own statement. He said-

The basic problem is, therefore, the best estimate that can be made of what anion it will bc required to meet them in each financial year.

On the facts, it seems that that was noi done. Other illustrations of the same sort of thing could be given. It is quite true that other governments find it difficult to decide upon a final figure. But this is a vital figure. These are the only Commonwealth departments which happen to have the beautiful round figure of £200,000,000 to spend annually - eight noughts and a two.

In fact, the money was not expended. The sum of £9,000,000 was added to what it was thought could reasonably be expended in the next year. It is useless for the Minister to say that there is, of course, always a shortage of equipment in the Army. Equipment must be obtained year by year. Otherwise, the budget will not be a true statement of the position, and the Parliament will bo misled. Decisions of the Parliament on taxation and the amount of money to be set aside for such purposes as social services might be affected. With the greatest respect, I suggest that the Minister’s own statement confesses the true position and admits the gravamen of the criticism.

Mr MENZIES:
Prime Minister · Kooyong · LP

– by leave - I have been more than a little mystified over this matter since I first read in one of the political gossip columns some reference to “ Tho mystery of the £9,000,000 “. Some newspapers have enriched their leading articles by references to it. What is the point about this £9,000,000? What offence has been committed? Having read what was originally published, as well as the evidence given before the Public Accounts Committee and the statement just delivered by my colleague, the Minister for Defence (Sir Philip McBride), I am forced to the conclusion that the whole argument is about whether we ought to budget for an expenditure of £9,000,000 which we are not certain that we will spend, hut which we hope to be able to spend. Is that an offence against budgeting? Above all, is it an offence against the safety of the country? It is quite true that, when the defence estimates in question were framed, we could not actually see how and where expenditure on certain equipment would be encompassed within the next few months. But we knew, as

I hope the country will know, that to train large forces and have them inadequately equipped is to create the illusion of defence, instead of the reality of defence. Therefore, we said, very properly, “Let us establish our financial capacity to produce more and more equipment for the people whom we are training, and if .t turns out that we cannot actually spend that sum in pounds, shillings and pence in the course of this year, ]et us put it into a defence trust account, so that if supplies become more freely available in the next year we shall be able to catch up some of the arrears and have our people in the services better equipped “. That seemed to me to be a thoroughly statesmanlike approach to the matter, and one dictated by considerations of reality on the defence front.

Mr Hulme:

– The point was also made to the committee that at the end of that year there was a liability on undelivered equipment.

Mr MENZIES:

– Precisely. As the honorable member knows, because he has gone into the matter, that is perfectly true. The whole point about defence appropriation is whether we want to be able to look forward for three years and say that at the end of that time we shall have certain armed forces, aircraft, equipment, conventional arms, and so on, or whether we ought to subscribe to the rather arid and academic idea that unless we can guarantee to spend, say, £9,000,000 during a particular year it ought not to be included in the estimates. I have not the. slightest doubt that the action taken in this case was completely right. My colleagues and I agree entirely with the Minister for Defence on this matter. The only pity is that it has been made, starting with some scribbler who did not understand anything about it, the occasion of a lot of sapient comment by people who do not understand it.

Mr CALWELL:
Melbourne

.- by leave - Mr. Deputy Speaker, neither the Prime Minister (Mr. Menzies) nor the Minister for Defence (Sir Philip McBride) has touched upon the essential facts of this matter. On the 26th March, the Auditor-General of the Commonwealth of Australia, who had been an assistant secretary, Department of the

Treasury, Defence Section, told a statutory body - the Public Accounts Committee - that he had been told by Cabinet, per medium of a telephone conversation between Canberra and Melbourne, that he had to increase the defence estimates of this country by £9,000,000. He had 24 hours only in which to do the job of getting the estimates up to the Cabinet. Mr. Newman, a very good and faithful public servant and a man who was justly rewarded a little while ago by being appointed Auditor-General, said that, left to himself, he had to find some vote to which he could attach this increase, and he thought, “ Well, we want more arms. We want more tanks. We want more equipment.” This was the only vote that he, a public servant, could justifiably increase in order to carry out the Government’s direction. Nobody in any service department told him that an extra £9,000,000 was wanted. In spite of what the Prime Minister and the Minister for Defence have said, neither of them has shown this House where an extra £9,000,000 for expenditure on equipment was required at that time. The Government simply made that beautiful figure read the 3ame for this particular year as for the previous year in order deliberately to mislead the Parliament. The Government has not expended that, amount up to date and has never, in any one year, expended £200,000,000.

Sir Philip McBRIDE:

– That is WrOng We expended £215,000,000.

Mr CALWELL:

– That amount may have been expended once. But the Government has been using its defence vote for the purpose of accumulating surpluses by increasing taxation on the people to a figure greater than has been required for the proper discharge of the responsibilities of government. Either that is so, or the Government simply did not know what was going on in the departments. It is not merely the evidence of Mr. Newman on that matter that is of prime concern. Even the service chiefs who gave evidence before the Public Accounts Committee, as reported in the daily press, showed that there was a great deal of muddling going on in the service departments and the Department of Defence. This House would never have known anything about this matter if Mr. Newman had not given his evidence before the Public Accounts Committee. I emphasize that the evidence was given on the 26th March and that this Rip Van Winkle Government did not make a statement on it until to-day, the 16th May.It has taken Ministers nearly eight weeks to realize that the public of Australia are concerned about this matter, and that it was about time some one made a statement on the subject.

The Prime Minister’s speech was a clever bit of special pleading. He said, “ Are we not concerned with the safety of the country?” Of course we are! The best way to make this country safe would be to remove the Government responsible for all the muddling in our service departments. But the next best thing to do is to throw the spotlight upon it for the expenditure that it incurs and which it finances, as has been proved in this case, by unnecessary taxation on the Australian people. There is not the slightest doubt that the public of Australia is concerned about the manner in which the £200,000,000 voted by this Parliament each year for defence is being spent. Thereis a very well justified feeling around the country that a lot of money is being wasted. It is certainly not being spent properly. Even in the aircraft factories there is always a certain amount of unemployment while the employees are waiting for the Government to make up its mind about the type of aeroplanes it will order in future. The chances are that the planes that it has on order now will be obsolete immediately they are built. That is why the Opposition is concerned about a lot of these things.

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

– That isa lot of nonsense.

Mr CALWELL:

– The £23,000,000 which the Minister for Defence Production (Sir Eric Harrison), as a sideline, is wasting on the St. Mary’s project in New South Wales could be better spent on real defence. It could be better spent on financing some social services. It could be better spent by helping to subsidize the

State governments to carry out works which are ancillary to the defence of this country.

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

– The honorable member does not know what he is talking about.

Mr CALWELL:

– I do know whatI am talking about, and I speak more or less in tune with a Government supporter, the honorable member for Indi (Mr. Bostock) in respect of certain matters. That honorable member is a most competent critic of the Government in this Parliament, and if the Government would take his advice instead of following the advice of the Minister for Defence Production and some others, we would gel some worthwhile results for the money expended. The Government should scrap its idea of having an extra two divisions in reserve, adopt the views of the honorable member for Indi, and have six squadrons of modern aircraft situated in the north of Australia. We would then save a lot of money and the Minister for Defence and the Prime Minister would not be forced to make explanation after explanation, months after the event, as to where millions of pounds have vanished.

Now I shall make way for the Minister for Defence Production in order to see whether he has anything to add to throw more light on the murky darkness of his Government’s administration than has been provided by his two colleagues who preceded him.

page 2091

QUESTION

GOVERNMENT BUSINESS

Precedence

Motion (by Sir Eric Harrison) pro posed -

That Government business shall take precedence over general business to-morrow.

Dr EVATT:
Leader of the Opposition · Barton

– This looks as if it is a very innocent proposal, hut one object of it is to prevent the House from dealing with private member’s business to-morrow and a matter which extends beyond private member’s business. I should like to refer shortly to it. It is a notice of motion in the name of the honorable member for Hindmarsh (Mr. Clyde Cameron) who, with the honorable member for Parkes (Mr. Haylen) and other members of the Opposition, has referred to this vital question. It has been proposed to move to-morrow, Thursday, the 17th May-

That this House resolves that, hick of finance for war service homes is defeating the [impost’s of the 1/.ar Service Homes Act, unci that inordinate delays in granting loans ure creating a black market in interest rate.?, depriving ex-servicemen of their right to own their own homes-

Conversation being audible,

Mr DEPUTY SPEAKER:

– Order ! Honorable members must be quiet. Order in that corner.

Dr EVATT:

– The lack of finance-

Further conversation, being audible,

Mr DEPUTY SPEAKER:

– Order !

Dr EVATT:

– If the Whip of the Australian Country party would preserve some sort of order-

Mr DEPUTY SPEAKER:

– Order! The honorable member for Mallee (Mr. Turnbull) and the honorable member for Hunter (Mr. James) will be quiet.

Mr James:

– Mr. Deputy Speaker, I want to say that I am a little hard of hearing. There is a continual barrage of talk behind my back and I object to it. Will you call the honorable member concerned to order?

Mr DEPUTY SPEAKER:

– Order ! I have called for order. I ask all honorable members to obey the Chair, and let the Leader of the Opposition be heard.

Tr. EVATT. - T was pointing out that the proposed motion is of great importance. It points to the lack of finance for war service homes and the inordinate delays which are creating a black market in interest rates and depriving exservicemen of their rights. That is an important matter. Honorable members opposite, as well as honorable members on this side of the House, have referred to it. The Opposition says that it should be debated to-morrow. I could understand the time for private member’s business being limited if some urgent Government business had to be dealt with. But to cut private members’ business from the business-sheet altogether by this blanket motion of the Vice-President of the Executive Council (Sir Eric Harrison) is really intolerable. It has been there for a couple of weeks now. I asked the Treasurer (Sir Arthur Fadden), to try to arrange for this to be debated on the day fixed. He said he would consult the Prime Minister (Mr. Menzies). We should be entitled to an undertaking that it will be debated sometime, if it cannot be debated to-morrow. In the absence of that undertaking we will vote against this motion.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I wish to oppose the motion, and I should like to remind the VicePresident of the Executive Council (Sir Eric Harrison), who proudly displays a returned servicemen’s badge, that this matter concerns-

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

– Does not the honorable member wish he was entitled to wear such a badge?

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I remind him that this concerns the welfare of the people whom his side of the Parliament claims to represent. When the Chifley Government was in power the right honorable gentleman himself repeatedly used to get up in his place in this chamber and protest against the administration of war service homes. Now the Opposition gives him, and the honorable members who sit behind him, who claim to have some interest in the welfare of ex-servicemen, an opportunity of saying and showing in this House whether or not they agree with the motion which stands in my name on the noticepaper. I want to say very definitely that the returned servicemen of this country are greatly disturbed at the way the Government has treated them in respect of war service homes. They are awaiting with a great deal of interest the outcome of the debate on the motion which they hoped would come on to-morrow, and if the Government thinks it is going to prevent the House from discussing the matter as the House should have the opportunity to do, then I can only say that the Opposition will have no alternative but to use the forms of the House to discipline the Government and compel it to adopt more democratic methods with regard to those items which affect, so vitally, the welfare of men who fought to protect this country against foreign aggression. I have dozens and dozens of letters in my office from returned servicemen-

Mr DEPUTY” SPEAKER:

– Order ! The honorable gentleman cannot discuss that in the debate on this motion.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I say, sir, that returned servicemen have a right-

Mr DEPUTY SPEAKER:

– Order ! The honorable gentleman may not discuss the merits of his motion.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– You are as bad as the Vice-President of the Executive Council. Am I not allowed to show the importance of the motion by referring to the fact that because-

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

– That is a reflection on the Chair.

Mr DEPUTY SPEAKER:

– Order ! Did the honorable gentleman reflect on the Chair? If he did so, he will apologize to the Chair. I did not hear the words complained of because the honorable member had his back turned towards me.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I did not reflect on the Chair.

Mr DEPUTY SPEAKER:

– I am informed that the honorable gentleman did so.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– What did I say?

Mr DEPUTY SPEAKER:

– The honorable gentleman will withdraw his reflection on the Chair.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I did not reflect on the Chair.

Mr DEPUTY SPEAKER:

– Sit down while I am speaking. If the honorable member reflected on the impartiality of the Chair, I ask for an apology.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I did not reflect on the impartiality of the Chair. What did I say? If you, Mr. Deputy Speaker, cannot repeat what I said, how can you say that my words constituted a reflection on the Chair?

Mr DEPUTY SPEAKER:

– Honorable members have informed the Chair that the honorable member reflected on it. The honorable member will therefore withdraw the reflection on the Chair.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– But how can you-

Mr DEPUTY SPEAKER:

– Order ! What did the honorable member say?

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– What did the honorable member say! That is for you to say, not me. I forget.

Mr DEPUTY SPEAKER:

– The honorable member will inform the Chair of what he said.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– I forget.

Mr DEPUTY SPEAKER:

– The honorable member will take his seat, and the motion will be put to the House.

Mr POLLARD:
Lalor

– I should not like, Mr. Deputy Speaker, to see any arbitrary action taken in relation to this particular protest by the Opposition and I think, sir, that you, with your usual liberality, will at least allow us to 3tate briefly some reasons why this matter should not be-

Mr DEPUTY SPEAKER:

– Order ! Within the last few minutes I have informed another honorable member that the merits of another matter may not be discussed on the motion that Government business take precedence over general business.

Mr POLLARD:

– I do not think Government business should take precedence. As a matter of fact, for Saturday next there is advertised, by a private auctioneer, a sale of war service homes land in the City of Sunshine, Victoria. If that land is sold in a great industrial city to land jobbers at a very high figure, obviously the war service homes-

Mr DEPUTY SPEAKER:

– Order ! That has nothing to do with the motion before the Chair. The honorable member may not discuss the merits of another motion of which notice has been given.

Mr POLLARD:

– It is important that we should be able to protest to the Government about its administration of a particular act. If next Saturday goes by without this matter having been discussed in the Parliament, and without a case having been stated for the withdrawal from sale of this desirable area of land, then the necessary case cannot be stated in this Parliament.

Mr DEPUTY SPEAKER:

– I rule against the honorable member on that point.

Mr POLLARD:

– Then I think you are a bit tough.

Mr DEPUTY SPEAKER:

– Order !

Sir ARTHUR FADDEN:
Treasurer · McPherson · CP

– This is much ado about nothing, because one of the measures that I shall introduce this afternoon, if given the opportunity to do so, will provide ample scope for a discussion on the subject-matter of the Opposition’s motion of which notice has been given.

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

– m reply - There is reason for every action underlying a motion proposed by me in this House.

Mr Pollard:

Mr. Pollard interjecting,

Mr DEPUTY SPEAKER:

– Order !

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

– The reason underlying this motion is that we believe that the Supply Bill shortly to come before the House, which will give the honorable member an opportunity to say everything he wants to say on war service homes, is much more important than a resolution to be moved for purely political purposes. When this matter is debated on the Supply Bill the honorable member will probably be absent. I know full well that when objection is taken to the imposition of the “ guillotine “ the Opposition never takes up the full time available for a debate. This has been done purely for political purposes. On one occasion the Opposition fell short, by three-quarters of an hour, of taking up the full time available for debate, and yet the honorable member was barking into the microphone that the Opposition was not being given enough time for debate. This is exactly the same thing. The Opposition is complaining that it has not bren allowed to debate its motion of which it has given notice, and when we point out that we are making better provision for a debate on the subject of it than is possible in respect of the motion itself, the honorable member for Lalor continues to interject. Why does not the Opposition give us a chance, instead of indulging in this political poppycock?

Opposition members interjecting,

Mr DEPUTY SPEAKER:

– Order ! Honorable members on my left will maintain order, or I shall deal with them.

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

– Why does not the Opposition divorce itself from all this political poppycock and party propaganda, and get down to the motion before the House?

Mr Webb:

– I rise to order, Mr. Deputy Speaker. I wish to know whether the word poppycock “ is a parliamentary expression.

Mr DEPUTY SPEAKER:

– The right honorable gentleman who used the word may give a definition of it.

Question put -

That Government business shall take precedence over general business to-morrow.

The House divided. (Mk. Deputy Speaker - Mr. C. F. Adermann.)

AYES: 49

NOES: 34

Majority 15

AYES

NOES

Question so resolved in the affirmative.

page 2095

ADDITIONAL ESTIMATES, LOAN CONSOLIDATION AND INVESTMENT RESERVE, AND ADDITIONAL ESTIMATES FOR WORKS AND SERVICES, 1955-56

Messages from the Governor-General reported transmitting (a)- Additional Estimates of Expenditure for the year ending the 30th June, 1956; and (b) an appropriation of the Consolidated Revenue Fund for the service of the year ending the 30th June, 1956, for the purposes of the Loan Consolidation and Investment Reserve established by the Loan Consolidation and Investment Reserve Act 1955, of such sums as the Treasurer from time to time determines; and also a further message transmitting Additional Estimates of Expenditure for Additions, New Works and other Services involving capital expenditure for the year ending the 30th June, 1956, and recommending appropriations accordingly.

Ordered to be referred to the Committee of Supply forthwith.

In Committee of Supply:

Motions (by Sir Arthur Fadden) agreed to -

Additional Estimates 1955-56

That there be granted to Her Majesty an additional sum not exceeding £21,003,000 for the services of the year 1955-50, viz.: -

Loan Consolidation and Investment RESERVE

That, in addition, there be granted to Her Majesty for the services of the year 1955-5U, for the purposes of the Loan Consolidation and Investment Reserve established by the Loan Consolidation and Investment Reserve Act 1055, such sums as the Treasurer from time to time determines.

Addition a l Estimates for Works and Services 1955-56.

That there be granted to Her Majesty an additional sum not exceeding £3,783,1100 for the services of the year 1955-50, for Additions, New Works and other Services involving Capital Expenditure, viz.: -

Resolutions reported.

Standing Orders suspended; resolutions adopted.

Resolutions of Ways and Means, founded on resolutions of Supply, reported and adopted.

Ordered -

That Sir Arthur fadden and Sir Eric Harrison do prepare and bring in bills to carry out the foregoing resolutions.

page 2096

APPROPRIATION BILL (No. 2) 1955-56

Bill presented by Sir Arthur. Fadden, and read a first time.

Second Reading

Sir ARTHUR FADDEN (McPhersonTreasurer) [4.0 j. - I move -

That the bill be now read a second time.

The purpose of this bill and of the associated Appropriation (Works and Services) Bill is to obtain parliamentary authority for certain expenditures for which provision was not made in the 1955-56 Estimates. The various items contained in the additional Estimates will be explained, when necessary, in detail in committee. There are some major items, however, to which I would like to refer at this stage. Approximately £3,500,000 is included under the votes of civil departments to meet the increase in salaries determined by the Commonwealth Court of Conciliation and Arbitration with effect from the 23rd December, 3954.

Certain re-allocations of the defence appropriations have been approved within the total budget provision of £190,000,000, with consequential increases and decreases in individual votes. Additional appropriations totalling £6,396,000 will be necessary for those votes where the revised allocation will exceed the existing appropriation, and a further £1,275,000 is required for the pay increases approved for members of the services and civil staffs. An amount of £1,600,000 is provided to meet expenditure on behalf of other governments which will not be recovered within the financial year. An amount of £661,000 is included for the Postmaster-General’s Department to meet increased rates paid to State railway departments for the conveyance of mails, and £3,500,000 is included for the redemption of savings certificates from the Consolidated Revenue Fund. This procedure has also been followed in each of the past three years. There has been some reallocation between the items of the capital works and services Estimates. Provision has also been made for certain other unavoidable expenditure which could not be foreseen when the original Estimates were prepared.

Honorable members will recall that the 3955-56 budget provided for the appropriation of £48,500,000 to the Loan Consolidation and Investment Reserve which was established by the Loan Consolidation and Investment Reserve Act 1955. lt is not possible at this stage to say exactly what additional revenue will be obtained in this financial year from the taxation measures introduced to the Parliament in March last. Between now and the end of June, moreover, there may be some other minor variations in the budget Estimates. Consequently, the financial results for the year cannot be forecast precisely at this stage. The Government proposes that any surplus of receipts over expenditure additional to the £48,500,C00 for which provision was made in the budget should be paid into the Loan Consolidation and Investment Reserve. There it will be available to meet the purpose of the reserve which, as was explained when the legislation was brought down last October, is to assist in meeting possible redemptions on the large Commonwealth loans which mature during the next few years. In the meantime, funds will be available in the reserve for investment as necessary in a loan to finance Commonwealth loan expenditure and to assist the 1955-56 Australian Loan Council programmes. It will be recalled by honorable members that at the meeting of the Loan Council in February this year the Commonwealth agreed to assist these programmes to the extent of £67,200,000.

Debate (on motion by Mr. Calwell) adjourned.

page 2097

APPROPRIATION (WORKS AND SERVICES) BILL (No. 2) 1955-56

Bill presented by Sir ARTHUR Fadden, and read a first time.

Second Reading

Sir ARTHUR FADDEN:
Treasurer · McPherson · CP

– I move -

That the bill be now read a second time.

In my second-reading speech on the Appropriation Bill (No. 2), I indicated that it was necessary to seek an additional appropriation for capital works and services. This bill will effect that appropriation.

Debate (on motion by Mr. Calwell) adjourned.

page 2097

SUPPLY 1956-57

Messages recommending appropriation reported.

In Committee of Supply:

Motions (by Sir ARTHUR Fadden) agreed to -

Supply

That there be granted to Her Majesty a sum not exceeding f Hi0,9li8,000 for or towards the services of the year 1950-57.

Supply (Works and Services)

That there be granted to Her Majesty a sum not exceeding £32,075,000 for or towards the services of the year 1056-57 for Additions, New Works and other Services involving Capital Expenditure.

Resolutions reported.

Standing Orders suspended ; resolutions adopted.

Resolutions of “Ways and Means, founded on resolutions of Supply, reported and adopted.

Ordered -

That Sir Arthur Fadden and Sir Eric Harrison do prepare and bring in bills to carry out the foregoing resolutions.

page 2098

SUPPLY BILL (No. 1) 1956-57

Bill presented by Sir Arthur Fadden, and read a first time.

Sir ARTHUR FADDEN:
McPhersonTreasurer · CP

– I move -

That the bill be now read a second time.

The purpose of this bill is to obtain an appropriation of £160,968,000 required to carry on the necessary normal services of government, other than capital works and services, for the first four months of the financial year 1956-57. The provision sought may be summarized under the following heads : -

The bill provides for the carrying on of essential services approved by the Parliament in the appropriation acts 1955-56. The several amounts provided for ordinary services represent, with minor exceptions, approximately one-third of the 1955-56 appropriations. The amount of £61,728,000 for Defence Services provides for expenditure on the current defence programme, and the amount of £8,978,000 forWar and Repatriation Services covers expenditure on repatriation and rehabilitation and other post-war charges. Except in relation to defence, no amounts are included for new services. However, an amount of £16,000,000 is sought for “ Advance to the Treasurer “ to enable the payment of the special grants to South Australia, “Western Australia and Tasmania to be continued pending the report of the Commonwealth Grants Commission, to make advances which will be recovered during the financial year and also to meet unforeseen and miscellaneous expenditure, particulars of which will afterwards be included in a parliamentary appropriation.

Debate (on motion by Mr. Calwell) adjourned.

page 2098

SUPPLY (WORKS AND SERVICES) BILL (No. 1) 1956-57

Bill presented by Sir Arthur Fadden, and read a first time.

Sir ARTHUR FADDEN:
Treasurer · McPherson · CP

– I move -

That the bill be now read a second time.

The purpose of this bill is to obtain an appropriation of £32,075,000 which is required to carry on the necessary normal capital works and services of government for the first four months of the financial year 1956-57. There will be Commonwealth works in progress at the 30th June, 1956, expenditure on which must be continued during the interval until the 1956-57 budget is passed by the Parliament. In addition, it is the practice to programme the capital works and services in the major Commonwealth departments, including the Department of Works, the Postmaster-General’s Department, the War Service Homes Division and the Department of Civil Aviation. The appropriation will also provide funds to ensure continuous employment and to enable purchases of materials in advance for the carrying out of those programmes of works. The bill provides for four months’ expenditure at the annual level at which expenditure was approved for the purposes of capital works and services in 1955-56.

Debate (on motion by Mr. Calwell) adjourned.

page 2099

SUPPLEMENTARY ESTIMATES 1954-55

Messages from the Governor-General reported transmitting Supplementary Estimates of Expenditure for the year ended the 30th June, 1955, and Supplementary Estimates of Expenditure for Additions, New Works, and other Services involving Capital Expenditure for the year ended the 30th June, 1955, and recommending appropriations accordingly.

Ordered to be referred to the Committee of Supply forthwith.

In Committee of Supply:

Motion (by Sirarthur Fadden) agreed to - supplementaryestimates.

That ‘there be granted to Her Majesty a further sum not exceeding £4,175,411 for the services of the year 1954-55, viz.: -

Supplementary Estimates for Works and Services

That there be granted to Her Majesty a further sum not exceeding £95,794 for the services of the year 1954-55 for Additions. New Works and other Services involving Capita] Expenditure, viz.: -

Resolutions reported.

Standing Orders suspended; resolutions adopted.

Resolutions of Ways and Means, founded on resolutions ofSupply, reported and adopted.

Ordered -

That Sir Arthur Fadden and Mr. Osborne do prepare and bring in bills to carry out the foregoing resolutions.

page 2100

SUPPLEMENTARY APPROPRIATION BILL 1954-55

Bill presented by Sir Arthur Fadden, and read a first time.

Second Reading

Sir ARTHUR FADDEN:
Treasurer · McPherson · CP

– I move -

That the bill be now read a second time.

The Supplementary Estimates of expenditure totalling £4,175,411 are for the financial year 1954-55. The amounts set out were expended from an appropriation of £16,000,000 made available to the Treasurer to meet expenditure which could not be foreseen when the Estimates were prepared. It is now necessary to obtain specific parliamentary appropriation for the several items of excess expenditure. Full details of the expenditure for 1954-55, which includes these items, are set out in the Treasurer’s finance statement for 1954-55 which was tabled during the budget session for the information of honorable members. The Estimates Papers 1955-56 also show the total amount voted for 1955-56 together with comparative figures for the previous year.

The Supplementary Estimates detail the items under which the additional amounts were expended by the various departments. The principal items, in round figures, are -

Any further details of the various items of expenditure will be provided at a later stage. The Supplementary Estimates 1954-55 have been examined by the Joint Committee of Public Accounts and I understand that its report thereon will be available for the information of honorable members prior to the commencement of the debate.

Debate (on motion by Mr. Calwell) adjourned.

page 2100

SUPPLEMENTARY APPROPRIATION (WORKS AND SERVICES) BILL 1954-55

Bill presented by Sir Arthur Fadden, and read a first time.

Second Reading

Sir ARTHUR FADDEN:
McPhersonTreasurer · CP

– I move -

That the bill be now read a second time.

Appropriations for Capital Works and Services for the financial year 1954-55 amounted to £102,584,000. The actual expenditure was £91,997,000, that is, £10,587,000 less than the appropriation. However, due to requirements which could not be foreseen when the Estimates were prepared, the expenditure on certain items exceeded the individual amounts appropriated and it is now necessary to obtain parliamentary approval to these increases. The excess expenditure on the particular items totals £95,794, which is spread over the various items of the departments, as set out in the schedule to the hill. Any details which may be required will be furnished at a later stage.

Debate (on motion by Mr. Calwell.) adjourned.

page 2100

TARIFF PROPOSALS 1956

Customs Tariff Amendment (No. 3); Excise Tariff Amendment (No. 3); Customs Tariff (Canadian Preference.) Amendment (No. 1); Customs Tariff (Papua and Newguinea Preference) Amendment (No. 1); Customs Tariff (Federation of Rhodesia and Nyasaland Preference)

In Committee ofWays and Means:

Mr OSBORNE:
Minister for Customs and Excise · Evans · LP

– I move- [Customs Tariff Amendment (No. 3).]

  1. That the Schedule to the Customs Tariff 1933-1956 he amended as hereinafter set out, and that on and after the seventeenth day of May, One thousand nine hundred and fifty-six, at nine o’clock in the forenoon, reckoned according to standard time inthe Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1956 as so amended.
  2. That, without prejudice to the generality of paragraph 1 of these Proposals, the Governor-General may, from time to time by Proclamation declare that, from a time and date specified in the Proclamation, the Intermediate Tariff shall apply to such goods specified in the Proclamation as are the produce or manufacture of any British or foreign country specified in the Proclamation.
  3. That on and after the time and date specified in a Proclamation issued in accordance with the last preceding paragraph, the Intermediate Tariff shall apply to such goods specified in the Proclamation as are the produce or manufacture of a British or foreign country specified in that Proclamation.
  4. That any Proclamation issued in accordance with paragraph 2 of these Proposals may, from time to time, be revoked or varied by a further Proclamation, and upon the revocation or variation of the Proclamation, the Intermediate Tariff shall cease to apply to the goods specified in the Proclamation so revoked, or, as the case may be, the application of the Intermediate Tariff to the goods specified in the Proclamation so varied, shall be varied accordingly.
  5. That the Minister of State for Customs and Excise may, from time to time, upon receipt of a report from the Tariff Board on the question whether a deferred duty should or should not operate on and after the date to which it has been deferred, by notice published in the Commonwealth of Australia Gazette defer the duty to such date as is specified in the notice.
  6. That in these Proposals, unless the contrary intention appears - “ deferred duty “ mean a duty which, in relation to any goods, is expressly described in the Schedule to these Proposals as a deferred duty ; “ Proclamation “ mean a Proclamation by the Governor-General, or the person for the time being administering the government of the Commonwealth, acting with the advice of the
Federal Executive Council, and published in the *Commonwealth of Australia Gazette ;* " the Intermediate Tariff " mean the rates of duty set out in the Schedule *to* these Proposals, in the column headed " Intermediate Tariff ", in respect of goods in relation to which the expression is used ; " the Tariff Board " mean the Tariff Board appointed in pursuance of the Tariff Board Act 1921-1953. [Excise Tariff Amendment (No. 3).] That the Schedule to the Excise Tariff 1021-1956 be amended as hereinafter set out, and that, on and after the seventeenth day of May, One thousand nine hundred and fifty-six, at five o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Excise be collected in pursuance of the Excise Tariff 1921-1956 as so amended. [Customs TARIFF (Canadian PREFERENCE) Amendment *(No.* 1).] That the Schedule to the Customs Tariff (Canadian Preference) 1934-1954 be amended as hereinafter set out, and that, on and after the seventeenth day of May, One thousand nine hundred and fifty-six, at nine o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs bc collected in pursuance of the Customs Tariff (Canadian Preference) 1934-1954 as so amended. [Customs Tariff (Papua and New Guinea Preference) Amendment (No. 1).] That the Schedule to the Customs Tariff (Papua and N-w Guinea Preference) 1936-1950 be amended as hereinafter set nut, and that, on and after the seventeenth day of May, One thousand nine hundred and fifty-six, at nine o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in accordance with the Customs Tariff (Papua and New Guinea Preference) 1936-1950 as so amended. [Customs Tariff (Federation of RHODESIA and Nyasaland PREFERENCE). {: type="1" start="1"} 0. -- (1.) That, in these Proposals - " Collector " have the same meaning as in the Customs Art 1901-1954 ; " the Customs Tariff " mean the Customs Tariff 1933-1956, anr! include that Act as amended from time, to time or as proposed to bo amended from time to time by a Customs Tariff alteration proposed in the Parliament ; " the Federation " mean the Federation of Rhodesia and Nyasaland ; " the proposed Act " mean the Ant passed to give effect to these Proposals ; " the Schedule " menu the Schedule to these Proposals. (2.) That a reference to the British Preferential Tariff in Column 3 of the Schedule be read, in respect of goods in relation to which the expression is used, as a reference to the rate of duty which, under section eight of the Customs Tarin, applies to goods of that kind which are the produce or manufacture of the United Kingdom. 1. That the proposed Act be deemed to have commenced at nine o'clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, on tho sixth day of July, One thousand nine hundred and fifty-five. 2. That, after the commencement of the proposed Act, duties of Customs be imposed, in accordance , with the Schedule, on goods described in Column 2 of the Schedule which - {: type="a" start="a"} 0. are the produce or manufacture of the Federation ; and {: type="1" start="6"} 0. have been shipped in the Federation for export to Australia. 3. That, for the purposes of the last preceding paragraph, goods shipped at the port of Lourenco Marques or the port of Beira in Portuguese East Africa for export to Australia be deemed to have been shipped in the Federation for export to Australia if there is produced to a Collector a certificate, in writing signed by an officer of Customs in the service of the Government of the Federation certifying that the country of origin of the goods is the Federation. 4. That the duties of Customs imposed on goods under these Proposals be in lieu of the duties of Customs imposed on those goods under the Customs Tariff. 5. That t he duties of Customs imposed under these Proposals be charged, collected and paid to the use of tho Queen for the purposes of the Commonwealth of Australia on all goods subject to those duties which have been or arc imported into Australia after the commencement of the proposed Act or have been or are imported into Australia before, and have not been or are not entered for home consumption until after, the commencement of the proposed Act. 6. That the Customs Tariff (Southern Rho 1( si in Preference) 1941 and the Customs Tariff (Southern Rhodesian Preference) J948 be repealed as from the time of commencement of the proposed Act. 7. That the Customs Act 1901-1954 be incorporated and read as one with the proposed Act. The five tariff proposals I have just introduced are, in the main, a reintroduction of the various Tariff alterations made by the Government during last year and which, prior to the dissolution of Parliament, had not been debated and embodied by acts in the respective Tariff Schedules. The collection of duties in accordance with the Tariff alterations proposed last year was, however, validated until the 30th June next by Acts Nos. 48 and 49 of 1955 and accordingly it is necessary that the proposed alterations be reintroduced before that date. In addition to the Tariff variations which are being re-introduced by Customs Tariff Proposals (No. 3) there are included in those proposals so:me Tariff alterations which are being introduced for the first time. These provide for increased duties on woodworking chisels, magnesium sulphate, footwear and greaseproof and glassine papers. In each case the proposed alterations are based on recommendations made by the Tariff Board following inquiries conducted by the board into the protective needs of the Australian industries concerned. At a later stage I will avail myself of the opportunity to table the relevant reports of the Tariff Board. The proposals also include amendments relating to chokes and ballasts of the types used with fluorescent lighting and to copper products such as angles, bars and sheets. These alterations also follow recommendations made by the Tariff Board but are more in the nature of administrative changes and do not vary the rates of duty presently applying to those products. No new Excise Tariff variations are proposed. The amendment contained in Excise Tariff Proposals (No. 3) providing for the duty-free entry of spirit for use by approved technical colleges and other educational institutions has been in force for some while. The Customs Tariff (Canadian Preference) Proposals contain some new matter. This relates to rubber sand boots and shoes and waterproof rubber footwear, the amendments proposed being complementary to amendments made in respect of footwear in Customs Tariff Proposals (No. 3). Under the Customs Tariff (Papua and New Guinea Preference) Proposals provision is now being made for the duty-free admission into Australia of timber and timber products which are the produce of the Territory of Papua and New Guinea and are covered by specified portions of Customs Tariff Items 291, 292 and 293. Honorable members will recall that some time ago the Tariff Board recommended that duty-free admission be accorded to Papua and New Guinea timbers and timber products with the qualification that a limitation be placed on the quantities of plywood allowed in duty free. Action was taken last year to implement the board's recommendation in respect of plywood, but as regards timber and timber products generally it has been necessary for the Government to seek the consent of the contracting parties of the General Agreement on Tariffs and Trade before according any new preferential treatment to those goods. I am happy to say that this consent has been obtained, and I feel that the action now proposed should prove of material assistance in the economic development of Papua and New Guinea. I would mention here for the information of honorable members that, following the receipt of the consent of the contracting parties, arrangements were made for the Papua and New Guinea timber and timber products concerned to be admitted into Australia duty-free under normal by-law provisions of the customs tariff pending the introduction of these proposals. No new matter whatsoever is included in the Customs Tariff (Federation of Rhodesia and Nyasaland Preference) Proposals. These proposals re-introduce the tariff preferences which Australia on its part agreed last year to accord on some seven commodities in exchange for tariff preferences on a comprehensive range of Australian products when imported into the federation. To assist honorable members in an easier understanding of the variations brought about by these five tariff proposals, I have prepared a document which compares the proposed duty alterations with the duties provided for in the existing tariff statutes. This document is attached to the printed proposals which are now in the hands of honorable members. At this juncture it is not proposed to proceed with a general debate on the proposals, but as soon as practicable honorable members will be given the opportunity to debate them fully. Progress reported. {: .page-start } page 2114 {:#debate-27} ### TARIFF BOARD Reports on Items. {: #debate-27-s0 .speaker-KMD} ##### Mr OSBORNE:
LP -- I lay on the table reports and recommendations of the Tariff Board in respect of the following subjects : - {:#subdebate-27-0} #### Carpenters' Chisels Chokes or Ballasts used in Fuorescent Lighting. {:#subdebate-27-1} #### Footwear {:#subdebate-27-2} #### Greaseproof and Glassine Papers {:#subdebate-27-3} #### Hacksaw Blades Magnesium Sulphate. "Wibau" Bitumen-mixing Plant. Ordered to be printed. {: .page-start } page 2115 {:#debate-28} ### EXPORT PAYMENTS INSURANCE CORPORATION BILL 1956 {:#subdebate-28-0} #### Second Reading Debate resumed from the 15th May *(vide* page 2075), orv motion by **Mr. McEWEN** - >That the bill be now read a second time. {: #subdebate-28-0-s0 .speaker-JYO} ##### Mr CLEAVER:
SWAN, WESTERN AUSTRALIA · LP .- I am a keen personal supporter of the proposed export payments insurance scheme. This legislation was forecast in the Governor.General's Speech at the opening of this Parliament, and it may be recalled that at that time a number of speakers on both sides of the House indicated their approval of the proposals. It was evident, therefore, that the insurance scheme was deemed desirable in the interests of exporters. Government supporters and Opposition members spoke, yesterday, regarding the general policy outlined in the bill, and the main criticism that has so far been levelled at the proposed legislation is merely that it does not go far enough. In. this connexion, 1 say, at the outset of my remarks, that the Government enters the insurance field with no thought at all of competing with the many established companies, but rather with the idea of providing all-important assistance to the country's exporters in an area of insurance that has been entirely untouched. We have uo wish to set up a national insurance scheme, but we are determined to stimulate the exports that are so necessary to the economy of our nation. We claim that there has been, in Australia, a vast expansion of secondary industries. This expansion must continue, and the responsibility for developing a producing and trading nation involves, I suggest, the removal of basic difficulties. Secondary industries could easily receive a setback in this country, for such activities are dependent upon capital equipment and raw materials that so often may be obtained only by importation from countries overseas. Should secondary industry, within a reasonable time, not succeed in exporting in quantity, imports of equipment and material may have to be curtailed, through simple necessity. This should lead us, I again suggest, to consider the two basic prob lems. First, all honorable members aru surely aware of the need for Australianproduced goods to be offered in external markets at competitive prices. As we give attention to the necessary overhaul of our internal cost structure, we shall undoubtedly find that action will need to be taken in respect of a number of matters. The first, - 1 suggest, is transportation costs. Secondly, I suggest that automation, about which honorable members spoke in this House recently, will have to be considered. Action will need to be taken, also, in regard to incentive payments, and general encouragement will need to be given to all persons who will be called upon to make extra efforts. I have said before in this House, and I, at least, consider that it deserves repetition, that we have much to learn, in this young, progressive industrial country, from our American friends. Although my business career has been comparatively short, indelible impressions have remained from my association over a number of years with an Australian manufacturing company whose parent company is in the United States of America. That company's success in this country was due in large measure to its calculated forward planning, the high targets set for achievement, the acceptance by management of constructive ideas submitted by even the most lowly employee, and its outstandingly thorough costing system. There are hundreds, and even thousands, of companies and industrial concerns in this country that need to modernize their cost structures and their internal organizations, so that they may produce goods that can sell at competitive prices in overseas markets. We must be ever ready to adopt the latest developments in the industrial field if our secondary industries are to produce high quality products at marketable prices. Another difficulty in Australia's bid to become a great trading nation is in finding new markets, while still holding and expanding existing ones. It is towards this worthy objective that the insurance scheme, to be operated by the Export Payments Insurance Corporation, will make a most positive contribution. Finding new markets can be a hazardous undertaking. New contacts in this field will inevitably raise the problem of untried credit stability of importers and agents in other countries. Internal unrest in some countries may easily boil over, providing a situation in which doubt is cast on the satisfactory financial adjustment of outstanding contracts. The insurance scheme which we are debating would protect exporters of both primary and secondary products, to the extent of up to 85 per cent, of the value of the goods involved, against default or non-payment risks of the type not normally accepted to-day by commercial insurance companies in Australia. Honorable members should realize that almost up to the present time Australia's exporters have been covered by irrevocable letter-of-credit arrangements in regard to their overseas transactions. But competition from other countries has become keener and in some cases long terms, with which our exporters have simply been unable to compete, have been offered. Thirty to 60 days' credit is a relatively short period in comparison with what is offered by some overseas countries, but one in which all sorts of problems and eventualities could still surely arise., A purchaser who appeared to be quite a good trade risk might well find his ability to pay for goods received cancelled entirely by his own government's action in respect of foreign exchange or import controls. Therefore, when we consider this point, we should remember that the finding of new markets requires stimulation of confidence concerning the risk involved and the provision of funds to keep the exporter liquid in his local operations. Other countries have successfully operated schemes similar to that proposed in this bill. These have done much to stimulate exports - the objective which this Government has in view. last night, the honorable member for Lalor **(Mr. Pollard)** spoke of the maximum liability of the corporation. In his usual alarmist style, he implied that the Australian Government could well be involved in the loss of £25,000,000. If other countries oan successfully operate a scheme of this kind, Australia can follow suit. We should not overlook the fact that complete protection is not available to the exporter. The margin of 15 per cent, will certainly demand reasonable care on his part if he is sending his goods to an untried market. If he does not exercise it, he will stand to lose heavily. The margin must surely be maintained by the corporation as one aspect of its own insurance against bad business. I have mentioned insurance schemes that have been successful in other countries. In this connexion we think primarily of the United Kingdom and Canada, and perhaps some observations in respect of the schemes in these two countries might assist us. It is interesting to note that Britain first took steps in the direction of offering export credit guarantees late in the last century. {: .speaker-KDA} ##### Mr Duthie: -- This is not an export credit measure. {: #subdebate-28-0-s1 .speaker-JYO} ##### Mr CLEAVER:
SWAN, WESTERN AUSTRALIA -- I am well aware that we are discussing an insurance guarantee system, but it is interesting to note that late in the last century the United Kingdom was concerned about the problems which had arisen in its trad Lug with Australia. The insolvency of a number of companies which occurred at that time naturally caused alarm amongst companies which were shipping their goods to Australia, and several insurance companies were formed. They failed because invariably they offered insurance against the whole of the loss, and traders were thereby encouraged to sell with little regard for the credit standing of buyers. The bulk of credit insurance in Britain is now carried on by two undertakings. The first is a private enterprise, which is partly owned by the large insurance companies, and the second is a government organization which is a department of the Board of Trade. The first concentrates on underwriting domestic credit insurance, and the second underwrites export risks. The Export Credits Guarantee Department of the Board of Trade insures, in one policy, against political and transfer risks, insolvency or failure to pay, war, revolution and like happenings, and changes in import licensing regulations in the country of destination. The United Kingdom scheme was started in a modest way after World War I., and when World War II. commenced it had the support of only about 300 policy holders. It now covers 3,000 exporters, with policies amounting to more than £525,000,000. Broadly, these policies cover consumer goods sold on terms of up to six months, and are generally on a whole turnover basis. The medium-term policies cover capital and other goods sold on terms of more than six months and cover individual contracts. A third type of policy has been devised to increase exports of both categories of goods to hard currency areas. Special policies to further assist exporters to enlarge their markets in the dollar countries are also provided. The United Kingdom scheme is meant to be self-financing. This is of interest to us in setting up our own scheme. What has been accomplished in the United Kingdom? Except during the war and in the year 1952-53, premiums have more than covered expenses. A very interesting example of the usefulness of the United Kingdom scheme was provided when Brazil blocked the payment of overseas commercial debts. The Export Credits Guarantee Department became liable to pay about £32,000,000, and within six months this was paid to the insured exporters. Those who had not protected themselves against these risks had to wait until Brazil lifted its currency restrictions. Turning quickly now to Canada, we note that there the system was not introduced until 1944. It follows closely the provisions of the United Kingdom scheme, but there are some differences. A risk which can be covered under the Canadian scheme is the risk of loss arising from any cause outside the control of both the exporter and the buyer. An important difference in administration is that the corporation does not "vet" transactions unless a claim is received. The exporter must, then show that he had had previous successful exporting experience with the buyer, or had obtained up-to-date credit references or reports. The Canadian scheme had shown a small profit until, like the United Kingdom, it was hit by the Brazilian transfer difficulties. The net result has been a very small loss for Canada, but when the Brazilian debts are recovered this will be converted to a profit. The honorable member for Lalor said yesterday, in error I am sure, that he understood that the Canadian export authority could engage in all forms of export insurance, including marine and fire risk. 1 have checked his actual words in the *Hansard* report. As a complete answer to the honorable member, I shall quote from an address given in January, 1954, by **Mr. B.** Duchesne, of the Canadian Exports Insurance Corporation, to an international trade congress sponsored by the International Trade Section of the Montreal Board of Trade. His subject was this important matter of export credits insurance. An extract reads as follows : - >The purpose of Export Credits Insurance is to provide Canadian exporters with protection against credit and political risks involved in foreign trade. This development of a government sponsored and financed insurance plan does not represent any intrusion of government into the business field. The risks covered by this type of insurance do not include any risks which can be and normally are insured by commercial insurers. Export Credits Insurance therefore differs entirely from marine insurance and covers a completely separate subject. Marine insurance covers the poods against physical damage. Export Credits Insurance, on the other hand, covers the foreign accounts receivable against nonpayment by the buyer or the buyer's country. > >Export Credits Insurance represents the provision by the Government of a service which cannot be provided by private enterprise and is a recognition of the fact that particularly in the case of difficulties in the transfer of the proceeds of export sales there is no other means by which an exporter can cover his risks or indeed assess the risk from information which is available to him. However, E.C.I, is not intended to subsidize the exporters. This plan is designed to place Canadian exporters in a position of competitive equality with exporters in other countries who enjoy similar protection. Canadian exporters will still have to compete in the export markets of the world on the basis of quality) price, credit terms, and service and other similar factors. Other claims were made yesterday by the honorable member for Lalor which I consider also call for some reply. I want to emphasize that this is an insurance scheme. The honorable member for Lalor, at some length, put before the House a proposal in connexion with wheat, involving many millions of pounds, andbe inferred that this type of risk could well be accepted by the corporation involving the corporation and the Government in one transaction absorbing the total liability of £25,000,000 specified for insurance contracts. I want to stress that if it is a true insurance scheme the risks will be planned and spread as they are in any other insurance corporation and the confining of business to one country or type of risk just could not be envisaged under the constant and trained control of the management of the corporation. Another point to which the honorable member for Lalor referred was the acceptance of risks in the national interest. We have been assured by the Minister for Trade that, in the preparation of this bill, careful consideration has been given to the acceptance of all types of risks. Naturally, precautions have been taken to see that risks relating to national interest, which should be handled in a different way, have been excluded. Finally, the honorable member for Lalor said quite definitely, if my recollection is correct, that the Minister would be virtually a dictator. In an important field of this kind, in which responsibility falls back on to the Government, control must vest in some one, and surely it is best vested, as the honorable member did admit, in the Minister of the department. {: .speaker-KYC} ##### Mr Pollard: -- I concur. [Quorum formed.] {: .speaker-JYO} ##### Mr CLEAVER: -Having outlined the aspects of the United Kingdom scheme and the Canadian scheme, I feel that I have brought forward an unanswerable argument, particularly with respect to the non-operation of the Canadian scheme in the field of marine and fire insurance. Having given a complete and satisfactory answer to the suggestions of the honorable member for Lalor, I am almost at the conclusion of my remarks. I note that some risks are covered in the United Kingdom and Canadian schemes which have been deliberately excluded from our own export payments insurance scheme. Thereby we should take confidence, surely, that undue risks are not being contemplated as this desirable scheme is introduced into our country. In conclusion, may I say that the Australian exporter has many problems and I endeavoured to touch on some of them in my remarks. These are problems which make it difficult to increase his export trade. The Minister for Trade, backed by the Government, has made somemost constructive moves in recent days to assist the export industry, and I claim that this export payments insurance scheme is designed to encourage the individual exporter to trade in the markets previously denied to him and in which he can be enabled to trade by means of a guarantee scheme of this nature. I trust, therefore, that we shall see in future days, after this legislation is passed, our export trade increase both in the secondary field and in primary industry. {: #subdebate-28-0-s2 .speaker-KXZ} ##### Mr PETERS:
Scullin .- The bill before the House proposes the establishment of a government insurance corporation in order to cover certain limited risks of exporters. This Government insurance company, according to the honorable member for Swan **(Mr. Cleaver),** may make some profits. If it does make some profits and adds to its assets in order to facilitate its operations in other parts of the world, what will the present Government do? Will it, as it did in connexion with Amalgamated Wireless (Australasia) Limited, and Commonwealth Oil Refineries Limited, dispose of the undertaking? Will it dispose of the undertaking if the undertaking is as successful as the Australian Whaling Commission which poured £200,000 a year into the coffers of the Government? Will the Government, as it intends to do with the Commonwealth line of steamers, dispose of the corporation at a suitable opportunity? The Commonwealth line of steamers is essential to the transport of the produce of this country overseas at a cheap rate. The Commonwealth line of steamers could do more for the export and import industries of this country than any corporation of this nature. Every one will say, " Of course, we don't intend this undertaking to make a profit ". The Government will be content to lose money on this corporation. Certainly, if I were a big businessman in this country sending goods to different parts of the world, I would not insure goods going to New Zealand against revolution, or goods going to Great Britain against calamitous conditions and non-payment as the result of currency problems in Britain. I would insure only a minute portion of the goods I was sending overseas. I would insure only goods that were going to countries in which there was a likelihood of some difficulty arising as the result of internal upheavals, currency problems or something of that sort. Therefore, it would be a case of " heads, I. win ; tails, the community loses ". Honorable members who have already spoken in this debate may say that this proposition is designed to promote Australian industries. I, of course, have consistently in this Parliament done all I could in order to see that Australian industries, secondary and primary, were promoted. I advocated tariffs. I advocated and supported import restrictions at a time when imports were pouring into Australia. 1 advocated the principle, enunciated by a committee formed by the Government, that depreciation allowances should be chargeable in relation to equipment used by secondary industries; but the Government would not accept that policy, which would have enabled the costs of secondary industries to be reduced to a minimum. I still believe in those things. .1 still wish to see that, as far as possible, goods that can be manufactured in Australia should be manufactured in Australia, and I still maintain that the home market should be conserved for the Australian manufacturer. I. believe, too, that the Indonesian, the man in India, the people of all other countries, are entitled to think similarly to me in connexion with the defence of the industries of their countries. But there lias occurred, since World War II. ended and nations have been able to rehabilitate themselves, a resurgence of industrial competition. Japan has re-entered the world's markets. Germany and other European nations are to-day struggling against Great Britain and America for markets. All are bringing into being different devices in order to undersell their competitors so as to capture markets. That is why we raised our tariff walls in order to keep out, not only the goods of the United States and Europe, but, also the goods of the United Kingdom. Britain sought to devise means whereby it could get its goods on our market despite our high tariffs, and this is what the British Board of Trade did: It said to manufacturers in Britain, " You shall have a quota for home sale. You shall also have to send to other countries a proportion of your manufactured goods in order to enable those goods to be sold there. We fix prices for home consumption which are adequate to provide you with such a profit that you will be able to sell your goods in other countries at less than the cost of producing such goods in those countries." I heard the Minister for Trade **(Mr. McEwen)** this afternoon bring down a report of the Tariff Board. One of the items dealt with in the report concerned instruments that are used in connexion with fluorescent lighting. I know that the Tariff Board's proposal in connexion with that particular item was submitted to the Parliament because the manufacturers of those goods in England were willing to sell the goods on the Australian market at what was tantamount to the cost of producing them in Britain. They were able to do that because they were selling them at considerably higher prices in other markets. The object was to destroy in Australia two factories that, manufacture those goods; and when those factories were destroyed the price of the British product on the Australian market would have been raised. I point those things out only in order to show that there is being carried on in the world to-day a fight for markets, here, there and everywhere. I say that Australia should seek to place its goods on the markets of other countries. If the people of those countries want Australian goods, they should trade, on thi basis of friendship and reciprocity. Our traders should not engage in conflicts hi order to secure markets, or to impos their goods on reluctant countries. As a result of heavy importation of goods, despite our high tariff walls. Australia found it necessary to impose severe import restrictions, just as Canada and South Africa years before found it necessary to impose high tariffs and import restrictions in order to protect their industries and, in addition, their overseas trade balances. A member of the Government - if I am not mistaken it was the Minister who introduced this bill - said that this proposition, and similar propositions in other countries, were brought into being and operated in order to nullify, to a certain extent, the import restrictions placed on trade by competing countries. The import restrictions imposed by nations vary in relation to particular articles from year to year and month to month. They vary in the degree of their severity. Because of that, there is a risk taken by exporters that before their goods reach their overseas destination there will arise difficulties in connexion with import restrictions. They seek, therefore, to be insured against. loss as a result of such restrictions. And well and good! I say that that is a reasonable proposition as long as it is not carried too far. But a. more intelligent method of attacking the problem of securing overseas markets is to emulate the British legislation regarding the utilization of credits provided by banks and guaranteed by the Government, or provided by the Government itself, to those who seek to sell on overseas markets to people who desire our goods, but are unable to pay cash for them. The proposition advanced by the Opposition seeks to ensure that the scheme shall operate in the interests of the inhabitants and the customers of Australia, rather than exclusively in the interests of big business. It has been stated that, as a result of the introduction of this scheme, goods will flow from Australia to other countries, and that our overseas funds, which are considerably depleted, will be built up. I agree with the statement that they need to be built up. They would not have become so depleted if the Government, which saw the continuous process of depletion, had taken early and appropriate action to rectify the position. We have between £200,000,000 and £300,000,000 in our overseas funds with which to procure raw materials and manufactured goods that cannot be produced here. Will the proposed scheme ensure a rectification of the position^ even if we export greater quantities of goods, and even if, as a result of its operation, Australian industries are stimulated? Is it certain that our overseas funds will rise? I say, definitely not. Let me quote the position of General MotorsHolden's Limited. That organization is not a good example, because it is not permitted by the overseas interests that control it to enter into unrestricted competition on the world's markets. The parent company overseas has allotted to it spheres in which it may operate. If an Australian company that has a considerable number of shareholders in, say, America, declares a dividend of 20 per cent., it is almost impossible for it to transmit that dividend to its overseas shareholders, because they can be paid only in goods or gold. We have no gold to send, and America, does not want the goods that we produce. What happens is that, when the company exports goods to such countries as Indonesia, Ceylon and Pakistan, the money so obtained is not used, to bring to Australia the goods that we need, but to send goods to America so that the American shareholders shall receive dividends that were previously ploughed back into the Australian industry. This Government is not tackling the development of Australian industries in the way that it should. I was amazed when supporters of the Government stated that they were sponsoring this proposal because they believed in the export of Australian secondary products, and that they intended to assist secondary industries to obtain overseas markets. T was amazed, because I remembered that, in days gone by, a supporter of the Government rose in his place and said, " Of course, we on this side of the House are all free traders. We believe in goods being manufactured in the cheapest countries and being sold wherever possible ". By doing that, the Government would have destroyed Australian industries. This Government has not implemented a recommendation that has been placed before it by a committee that it appointed in relation to depreciation allowances for machinery in order to reduce the cost of manufacture. On the contrary, over the years, it has consistently allowed the people of Australia to be exploited by the import of goods from overseas. It lias maintained that to do so was a method of destroying inflation - that because cheap goods were being imported, prices would not rise as they had hitherto. That policy was implemented in 1952, with disastrous results to the community. I a p peal to honorable members - undoubtedly, I shall do so in vain - to alter the proposal so that the proposed corporation shall be a credit corporation as well as an insurance corporation, as is provided in the British and Canadian legislation. At no other time in the history of Australian secondary industry have such vast profits been amassed as are being amassed to-day. Not only General Motors-Holden's Limited, but also other kinds of manufacturers, have earned vast profits. There have been understandings between capitalists that have resulted in a maintenance of high prices. The Australian Labour party believes in supporting secondary industries, but it also believes in protecting the consumers and the workmen who are engaged in those industries. The furniture manufacturers of Victoria and New South Wales have understandings whereby the prices of their commodities are maintained at a certain level, and no one dares to sell his products at prices which are below those that have been dictated by the cartel. That, of course, leads to the maintenance of a high level of prices in this community. The profits are not 15 per cent., but more. Profits from similar undertakings overseas are not 15 per cent., but more, and the 85 per cent, cover under this legislation would be more than adequate, if the industries lost on the markets overseas, to show those persons controlling the industries in Australia a profit from the proceeds from the sale of their goods combined with collections from the government corporation. Because of - this, I believe that unless the legislation is radically altered along the lines suggested by the honorable member for Darebin **(Mr. R. W. Holt),** the honorable member for Lalor **(Mr. Pollard),** the honorable member for Yarra **(Mr. Cairns),** and the honorable member for Melbourne Ports **(Mr. Crean),** it will not accomplish very much in the interests of the Australian people, nor will it make for more friendly relations with those countries with which we trade. We should try to set a good example to other countries, and the basis of our trade with the customers who surround us should be reciprocity and friendship. {: #subdebate-28-0-s3 .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I rise to indicate, as other members of the Opposition have indicated, that the Opposition supports the bil! so far as it goes, subject to certain amendments which we shall move in the committee stage. However, we believe that the bill does not go far enough. It is only tinkering with the problem for us to content ourselves with a bill that seeks to insure merely against non-payment by countries that import our surplus products. We must do more than that. In addition, we must provide the credit necessary to enable countries, which cannot pay cash, to buy on a long-term credit basis the surplus products which we have for sale. We believe that it is a weakness on the part of the Government to omit from the bil] the right of the corporation to cover all forms of insurance associated with overseas trade. There is no doubt that this is just another example of the Government's self-professed belief in grand old private enterprise, which is very happy to accept an undertaking if it is profitable, such as risk of piracy, or of a ship striking a mine, hiding a reef, or catching fire. But where there is likely to be some loss, private enterprise, of course, is not interested, so the Government obligingly relieves private enterprise of its obligation in that respect, and decides that the Australian people will bear the risk associated with that kind of insurance. However, the bill says that the corporation shall not be permitted to accept insurances of types that are profitable. Therefore, we shall move that that provision be deleted. It is quite wrong that the Government should seek to permit the corporation, which is handling the people's money, to bank with some private trading bank. If it is good enough for the taxpayers to provide the money necessary to make the corporation tick, the people's bank, the Commonwealth Bank, is surely good enough to enjoy the benefit that might accrue from any banking transactions that follow. Our other criticism of the bill, apart from the fact that, generally speaking, it does riot go far enough, is in respect of clause 35, which gives the Minister the right to delegate powers to any person whom he cares to nominate. In theory, this person could be his typist or the gardener. In theory, it could be any unsuitable person, but I admit that in practice it is not likely to be such a person. However, it is wrong that such a delegation is, in theory, possible. If it is wrong in theory, the provision ought not to appear in the bill. Therefore, as the honorable member for Lalor has already indicated, the Opposition suggest* that the only person to whom the Minister shall delegate these enormous powers should be the head of the department, or an officer of the second division of the Commonwealth Public Service. I desire to address my remarks in particular to the members of the Australian Country party in this House. No member of the Liberal party is present at the moment, which is in keeping with the lack of interest of members of that party in primary production generally. Even if they were present, they would not be interested in matters affecting the primary producer. {: .speaker-KID} ##### Mr Luchetti: -- There is one member of the Liberal party in the House. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- There is one, a new member from Western Australia, who has not yet learned that the Libera] party has no real interest in primary production, but twelve months hence, of course, he will have learned from his Liberal colleagues that matters affecting primary production are no concern of the Liberal party. Although members of the Australian Country party deign to sit and listen to the debate, we shall find that they are no more interested in the welfare of the primary producers than are members of the Liberal party. {: .speaker-KWP} ##### Mr Turnbull: -- Then it must come hack to the Australian Labour party. Tt, is the great party! {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- That is right. I am glad that the honorable member for Mallee **(Mr. Turnbull),** who is a member of the Australian Country party, admits that the Australian Labour party is the only true friend of the primary producer. {: #subdebate-28-0-s4 .speaker-KYC} ##### Mr POLLARD: -- Only one Minister is present. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- As the honorable member for Lalor says, only one member of Her Majesty's Cabinet is present to listen to this most important debate. But I am prepared to assert now that when the vote is taken in committee, as it will be taken shortly, whether or not members of the Australian Country party are more interested in thiaffairs of the primary producer than are their Liberal party colleagues, they will walk across the floor of the chamber with their Liberal party colleagues in order to vote against an amendment which the Labour Opposition will propose. The amendment that we shall propose in the committee stage will be of vital interest to the primary producers of this country, but I now prophesy that it will be opposed, to a man, by members of the Australian Country party, although it is designed to make the one and only provision which can save the primary producers from bankruptcy if the present trend continues. {: .speaker-KYC} ##### Mr POLLARD: -- And the manufacturers. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- The manufacturers, too, as the honorable member for Lalor says, but I appeal to members of the Australian Country party to take some interest, at least, in the affairs of the primary producers, even if they cannot interest themselves in secondary production. The Opposition will move, in committee, that in addition to what the bill proposes a provision be included to enable the corporation to finance on a long-term credit plan overseas countries which cannot pay cash for our surplus primary production which we are unable to sell to customers who can pay cash. {: #subdebate-28-0-s5 .speaker-JLU} ##### Mr ANDERSON:
HUME, NEW SOUTH WALES -- A kind of hire purchase. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- What if it is a kind of hire purchase? Is it not far better that the hungry children of Asia should eat our wheat than that the weevil? should eat it while it is stored away in silos while we cannot find a market for it? {: .speaker-KID} ##### Mr Luchetti: -- What about the driedfruits industry? {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- It will be interesting to see how the honorable member for Mallee **(Mr. Turnbull),** who pretends to be so interested in the dried fruits industry, really votes when the amendment is moved at the committee stage. {: .speaker-KWP} ##### Mr Turnbull: -- I rise to order. The honorable member for Hindmarsh has said that I pretend to be interested in *the* dried fruits industry. That remark implies that I am a liar. Will you, **Mr. Deputy Speaker,** direct that it be withdrawn? {: .speaker-KYC} ##### Mr Pollard: -- The honorable member is just a pretender. {: .speaker-KWP} ##### Mr Turnbull: -- The implication is that I am just a pretender and that I am acting wrongly. I ask that the remark made by the honorable member for Hindmarsh be withdrawn. {: #subdebate-28-0-s6 .speaker-10000} ##### Mr DEPUTY SPEAKER: -Order! The remark was hardly objectionable. {: .speaker-KWP} ##### Mr Turnbull: -- It was very objectionable to me, and I ask that it be withdrawn. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! T do not think it need be withdrawn. {: .speaker-KWP} ##### Mr Turnbull: -- It was a despicable remark. The honorable member for Lalor, also, should have been man enough not to make the interjection that he made. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I thank you, **Mr. Deputy Speaker,** for your ruling. I wish to make it quite clear that I did not mean to imply that thu honorable member for Mallee was a liar. {: .speaker-KWP} ##### Mr Turnbull: -- The honorable member said that I was acting a lie. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Nor did [ mean to imply that the honorable member was acting a lie. I said that he professes- {: .speaker-KWP} ##### Mr Turnbull: -- "Pretends." {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Or pretends. I see very little difference between the two words. {: .speaker-KWP} ##### Mr Turnbull: -- There is a lot of difference. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- If the honorable member professes to be interested in the dried fruits industry- {: .speaker-KWP} ##### Mr Turnbull: -- I am interested in it. {: #subdebate-28-0-s7 .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- The honorable member says he is. {: .speaker-KWP} ##### Mr Turnbull: -- The honorable member for Hindmarsh says that I pretend to be interested in the dried fruits industry. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- If ti* honorable member votes against the Opposition's amendment, his action will prove that his profession was only a pretence. {: .speaker-KWP} ##### Mr Turnbull: -- It will not. I tell the honorable member now that I shall vote against the amendment. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I should like to remind the honorable member for Gwydir **(Mr. Ian Allan),** who, to some degree, represents wheat-growing interests, and my friend the honorable member for Hume **(Mr. Anderson),** who also, I think, represents an electorate where wheat is grown, that we *hap* stored in Australia to-day no fewer than 204,000,000 bushels of wheat, which, as yet, we have not been able to sell. Thai quantity includes 24,000,000 bushels carried over from last season which we have not yet been able to sell. When vc recall that we produce 180,000,000 bushels of wheat a year, that we ourselves consume only about 60,000,000 or 70,000,000 bushels annually, and thai, under the International Wheat Agreement, we have a guaranteed quota of only about 30,000,000 bushels that we may sell to the United Kingdom or to the other countries that are parties to the agreement, we begin to realize the great gap that is developing between Australia's production of wheat and the quantity that we can sell in markets both inside and outside Australia. I think it is important, at this stage, to mention a statement made recently by President Eisenhower, of the United States of America, in a message delivered to the United States Congress on the 9th January last, to the effect that "for each bushel equivalent sold, one and a half bushels have replaced it in the stock pile'". He directed attention to the fact that the surplus of wheat in the United States is increasing at such a rate that America is approaching the point at which it will have to stop producing wheat and enter upon a new programme involving what the Americans are pleased to call the soil bank, rather than produce wheat that they are not able to sell. If millions of people were not starving in Asia at the present time because they cannot get wheat to eat, perhaps it would be a logical proposition to establish a soil bank, but, when Asian people are starving because they cannot get enough food and when farmers are going bankrupt because they cannot sell the surplus food that they are producing- {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member is now getting very far away from the bill, which is designed to encourage exports from Australia. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I am referring to the amendment that I have said the Opposition will move at the committee stage. It has not yet been circulated, but I have indicated that it proposes that the Government should go beyond the mere insurance of exports and should guarantee, on a long-term credit basis, payment for the surplus wheat and other primary products that other countries need but cannot pay cash for. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! My point stands, because the amendment has not yet been moved. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- It cannot be moved until the committee stage. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! The honorable member may not base his remarks at this stage on something that will be moved in committee. He must confine his observations to the bill. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I was criticizing the bill because it did not go far enough. {: .speaker-ZL6} ##### Mr Hasluck: -- No. The honorable member was criticizing it for not being what it was not. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I was criticizing it because it did not go far enough. I said it should go far enough to provide for long-term credits for exports to countries that cannot pay cash. {: .speaker-ZL6} ##### Mr Hasluck: -- The honorable mem ber proposes to make it an entirely different bill dealing with an entirely different subject. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- I do not. I propose that there be added to the bill provision for something entirely different from what is at present provided for. {: .speaker-ZL6} ##### Mr Hasluck: -- Dealing with another subject. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Dealing with another subject. {: .speaker-6U4} ##### Mr Whitlam: -- Dealing with the same subject as is covered by corresponding measures in Canada and the United Kingdom. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order I That is not the point, {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- The bill provides only for insurance against nonpayment for exports. 1 suggest that it should provide for long-term credits for exports to countries that do not wish to repudiate our exports, but cannot pay cash and will purchase our surplus foodstuffs to feed their own people, who so badly need food, if we can arrange Vor long-term credits so that they may make payment later. {: .speaker-ZL6} ##### Mr Hasluck: -- Is that the economic policy of the Australian Labour party? {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- It is the policy enunciated by the Australian Labour party during the last general election campaign. If the Minister for Territories **(Mr. Hasluck)** will read the policy speech of the Leader of the Opposition **(Dr. Evatt),** he will see that- {: .speaker-KGC} ##### Mr Hamilton: -- Are the speeches of the Leader of the Opposition available? The Australian Labour party does not seem to make them available. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- The Leader of the Opposition's speeches are available. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! Too many honorable members seem to be trying to speak at once. The honorable member for Hindmarsh should be allowed to make his speech without interruption. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- The Minister and the honorable member for Canning **(Mr. Hamilton)** will see that the Leader of the Opposition made it quite clear in his policy speech that, if a Labour government were elected, it would, without delay, implement a scheme under which countries that cannot pay cash for our surplus commodities would be given long-term credits by that government, which, in the meantime, would pay to the primary producers of Australia a price equivalent to the world parity value of the commodities sold to other countries. The dried fruits industry would be vitally affected by such a proposal. The wine industry also - I. notice that the honorable member for Angas **(Mr. Downer)** smiles when I mention it - would be vitally affected by such a plan. It will be interesting to see whether the honorable gentleman from Angas supports the Opposition's amendment. Strangely enough, we have, to-day, a surplus of coal, which could be exported to many countries that want it badly, but do not take it only because they cannot find the ready cash to pay for it. We should help them to get the coal they want. There are, in Asia, potentially great markets for our commodities if only the Australian Government will take steps now to get in on the ground floor. What hope have we of gaining a footing in the Asian markets against competition .from countries such as the United Kingdom and Canada, and, to some degree, the United States, which say to the Asian people, in effect, " Not only will we supply the goods that you want, but also we will supply them on longterm credits, so that you do not have to pay for them immediately, but may pay later as your country develops, at a time when you feel able to pay"? Would it not be far better for us to spend, if necessary, £100,000,000 or £150,000,000 a year on such a scheme than to continue to waste many millions of pounds on defence because we are afraid that a hungry people to the north of us make take aggressive action against us ? One of the best measures for bringing about goodwill and one of the most effective measures for preventing the spread of communism in those countries is to see that the people there are properly fed and that millions upon countless millions of hungry people are not driven into the Communist camp in the belief that that is the only way in which their problems can be solved. {: .speaker-10000} ##### Mr DEPUTY SPEAKER: -- Order ! Having said that, the honorable member should return to the bill. His comments are getting too wide of the measure. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Very well, **Mr. Deputy Speaker.** We criticize the bill in the three respects that I have already outlined, but apart from them, the Opposition says that it is a good bill so far as it goes, but it does not go far enough. As the honorable member for Lalor has pointed out, Canada to-day is able to account for one-tenth of the whole of its export trade through the method of finance that we claim ought to be included in this bill. England is able to account for one-seventh of its total export trade that has been built up as a result of the very proposal that we now ask the House to adopt. We believe that if this question is to be faced fairly and squarely, as it has to be one day by some government - and the quicker the better - this Government has no alternative but to do what the Government of the United Kingdom and the Government of Canada have already done. I ask the Government to support the amendment that tb« Opposition will submit in committee. {: #subdebate-28-0-s8 .speaker-JLU} ##### Mr ANDERSON:
Hume .- The purpose of this bill was described in die Governor-General's Speech to the Parlia-ment on the 15th February last. It is one of the means of rectifying the adverse balance of payments. The Opposition has offered a lot of criticism of tie measure, but much of it is of little value. T do not say that because I want to criticise members of the Opposition, but I believe that much of what they say does not bear examination. I will take one point from the speech of my old friend, the honorable member for Lalor **(Mr. Pollard).** He said that the risk the Government was taking with the taxpayer's money might be enormous. He suggested that if an order for 100,000,000 bushels of wheat was received suddenly and the buyer failed to pay, the Commonwealth would be very seriously bit financially. It is so easy to say these things airily. People listening to the broadcast of the debate think "that seems a very intelligent criticism". But is it intelligent? What does 100,000,000 bushels of wheat mean? It means that approximately 3,000,000 tons have to be shipped from this country to the buyer. The whole of that process would, probably involve the use of 500 or 1,000 ships, and the corporation that is to be constituted will take no action to protect the interests of the taxpayer. That is a considered opinion from the honorable member for Lalor. {: .speaker-KYC} ##### Mr Pollard: -- I did not say that at all. That is a complete misrepresentation. {: .speaker-JLU} ##### Mr ANDERSON: -- The honorable member was Minister for Commerce and Agriculture in a Labour government. He said that 100,000,000 bushels of wheat would be sent from this country, and that we would lose the money. I come now to a consideration of the balance of payments position. The matter is quite simple. The reason why our balances go down is that there is an enormous unfulfilled consumer demand in this country. Had we not employed our balance of payments to the greatest capacity within reasonable limits, infla tion would probably be higher in Australia. The importance of having funds overseas is enormous, but we have to build them up. Secondary industry is not playing its part in doing so. We could also improve the export of primary products. This is a bill to enable exporters to insure against certain losses which are not normally accepted by insurance companies. The Opposition wants to make its scope wider. It wants to alter the whole purpose of the bill. Let us stick to one thing at a. time, and allow exporters to insure against these losses. That would put our manufacturers on a competitive basis with other manufacturers throughout the world. The Opposition, asks why the Government must take these risks. Honorable members opposite ask in effect, "Why should not private enterprise, which is engaged in other classes of insurance, take the risk " ? On every possible occasion, every member of the Opposition attacks private enterprise. It is a technique that Opposition members adopt at every opportunity. We know the reason why, but the danger is that if you give a dog a bad name sufficiently often, that dog will get a bad name. Private enterprise has built this country into a great free nation - and do not forget " free ", because nothing under socialism is free. A man in this country has human dignity. The curious thing is that, in Parliament, on the hustings and everywhere else, members on the other side attack the private enterprise system, but their attack is not reflected in their policy speeches at election time. Those speeches read like a prospectus for an ordinary financial corporation, a kind of bogus company. There is no mention then of socialism. Is there anything wrong with the Government's policy of making this business a government proposition ? Does it conflict with the Liberal philosophy that the members on the Government side profess? Labour members say it does, but I do not think so. There is nothing in Liberalism or in the system of private enterprise that is stationary. {: .speaker-KYC} ##### Mr Pollard: -- There is nothing in it; it is stationary. {: .speaker-JLU} ##### Mr ANDERSON: -- It is not a stationary creed at all. There are no hard and fast rules. The fundamental principle is that the maximum use be made of the forces of society - energy and initiative. Those are used in a Liberal philosophy, and there is nothing stationary in that creed at all. As long as free natural forces are allowed to have full play, they succeed better than any government control. The system is capable of a great variety of applications. There is a very big difference between the creation of a system within which free competition will work as beneficially as possible and a system that expects factors to remain as they are. A tremendous amount of harm has been clone to the private enterprise system and Liberal philosophy by an insistence on so-called rough rulesofthumb of Liberalism. That is not Liberalism at all. It is Labour policy - the creed of *laisser-faire.* The Labour party would always have us believe that Liberalism does not want governmentowned undertakings, but' nothing is further from the truth. There is no reason at all why a government cannot engage in undertakings. There are many aspects of society where a government cannot interfere, and others that private enterprise cannot undertake. For instance, the sign-posting of roads. If that were left to private enterprise, it would not be effective. There are many undertakings where private enterprise cannot fit in. I do not suggest that private enterprise would be very successful in controlling a police force, but there are places where it can be effective. Within the terms of this bill, there are risks that the Government is better able to insure against than is private enterprise. Commercial houses and the like could not possibly obtain the necessary information, or give security to exporters. Why should not our exporters have reasonable security? Why should not the Government provide it? The Labour party will say, " The Government is to provide it because big business wants it ". It is " big business " the whole time. Any time mention is made of manufacturing or any part of the private enterprise system, Labour raises the cry of big business, the tall poppies. Labour is always for the small corner shop. This explains their affinity to the barrow-men. The Labour party wants the whole of industry brought down to that level. That is why the barrow-men are so closely affiliated with State parliaments. One thing Opposition members will not recognize is that if our exports are increased, there will be increasing employment for our people. That matter is entirely neglected by Opposition members. They are obsessed by what they call the enormous profits that big corporations are supposed to make. Do they want to find new markets for our products? Do they want to ensure security of employment for Australian workers? Surely the best way to ensure security of employment is to create avenues of employment, and that is what the proposed scheme will do. {: .speaker-KDA} ##### Mr Duthie: -- Does the honorable member believe in trading with China? {: .speaker-JLU} ##### Mr ANDERSON: -- I believe in trading where we can. within reason, but I do not believe in carrying on trade with a country which has different ideas from ours on the subject of aggression. I should like to examine that point further, but I do not think that it is a point that should arise in this debate. I come now to the matter of the risks involved in exporting, or in creating new markets for exporters. A tremendous amount of information on the subject of export markets must be obtained. It can be obtained through our trade commissioners, and by other means that are not so readily available to the ordinary commercial enterprise. I do not believe that the action of this Government in starting off this scheme as a government enterprise conflicts in any way with the political philosophies of honorable members on this side of the House. Parliament will have complete control of the scheme. The bill provides for wide powers to be enjoyed by the commissioner, without too much ministerial interference. That is in accordance with the general policy of this Government, which is to allow the man who knows a job to carry it on. Clause 11 of the hill provides for the maintenance of ministerial control, and it ensures that the policy laid down by the Minister shall be followed. That matter is completely safeguarded. Clause 12 provides for the appointment of a consultative committee. Opposition members freely criticized this clause, suggesting that unsuitable persons may be appointed to the council. Such criticism is not unusual, because if this Government appoints any person who is not connected with a trade union to such a body as this, that appointment is immediately suspect. Never do we hear Opposition members say a good word for management, no matter how efficient it is, or how carefully it considers the welfare of its employees. The Opposition is obsessed with the idea that large profits are made, but it should not forget that employment is possible only when profits are being made. What is wrong with the policy of appointing to this consultative committee a man experienced in the insurance field? Honorable members opposite may say that such an appointment is all wrong, but I ask them to consider the types of men that the Labour party appoints to such positions when it is in power. Take die case of " Admiral " McGirr, who was appointed to control the Maritime Services Board of New South Wales. What training did he have that would be of value to the nation in that, position? Consider, also, the appointment of "Milko" Ferguson as Chairman of the Milk Board of New South Wales. ITe was the leader of a (mcle union. What docs he know about milk? I do not know who the Government intends to appoint to the consultative committee, but if a business man of any kind is appointed, that appointment will be immediately suspect in the minds of honorable members opposite. Any persons who have been appointed by this Government to committees or consultative councils or the like have been selected for their experience in the particular field involved. I commend that policy to the Labour party, because if ever a political party has followed the practice of puting its friends in jobs it is the Labour party. I believe that this bill provides for the fulfilment of all the promises made by the Government in this direction during the election campaign. I believe that it will have the effect of increasing our exports. It is a forward move by the Department of Trade toward? improving the position of our overseas balance of payments, and will therefore benefit Australia. Opposition members claim to represent trade unions and their members, and I suggest that they should try to make this scheme work. They should try to create a market for the products of our secondary industries. They should try to foster pride in workmanship, so that when our goods are sent overseas, marked "Made in Australia", they will be accepted as being of high quality. Great Britain built up its overseas trade with the slogan "Made in Britain", which was recognized as the identification of a product of good quality and design. Why should we not do the same? I believe that if we can find a substantial market overseas for the products of our secondary industries we shall ensure the maintenance of full employment in this country. I strongly commend this bill to the House. {: #subdebate-28-0-s9 .speaker-KDA} ##### Mr DUTHIE:
Wilmot **.- Mr. Deputy Speaker-** Motion (by **Sir Eric** Harrison) put - >That the question be now put. The House divided. (Mr. Deputy Speaker - Mr. C. F. Adermann.) AYES: 51 NOES: 29 Majority . . . . 22 AYES NOES Question so resolved in the affirmative. Original question resolved in the affirmative. Bill read a second time and committed *pro forma;* progress reported. *Sitting suspended from* 6.2 *to 8 p.m.* Message recommending appropriation reported. *In committee* (Consideration of Governor-General's message) : Motion (by **Mr. Osborne)** agreed to- That it is expedient that an appropriation of revenue he made for the purposes of a bill for an act to promote trade with countries outside Australia by establishing an Export Payments Insurance Corporation to provide insurance against certain risks arising out of thattradenot normally insured with Commercial Insurers. Resolution reported and adopted. *In committee:* Consideration resumed. Clauses 1 to 5 agreed to. Clause 6 (The Export Payments Insurance Corporation). {: #debate-28-s0 .speaker-KYC} ##### Mr POLLARD:
Lalor .- Clause 7 provides for the appointment of a commissioner to administer the proposed corporation. He is to be appointed for a period of seven years, and is to be eligible for re-appointment. I note that the salary and allowances are not stated. I think it would be fair to ask the Government what is in its mind regarding a salary for the commissioner of this very important instrumentality, whose obligations may, at any one time, amount to £25 000,000. This is a very important class of work, and the Government should intimate what type of man it has in mind. Does it propose to appoint one of our very capable administrative officers from the Department of Trade, the Department of Primary Industry, or some other department? Or does it propose to appoint some one from the commercial insurance world? The Parliament should he given some indication of the type of man that will be chosen, the source from which he will be drawn, and the salary that he will be paid. I believe that it would be no more than fair for the Government to supply that information. {: #debate-28-s1 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP -- Honorable members opposite may rest assured that the officer chosen to occupy this important post will be adequately paid. I do not propose to indicate the salary at the present time; indeed, I am not aware that it has been definitely fixed. Clause agreed to. Clauses 7 to 10 agreed to. Clause 11 (Relations of Corporation with Minister). **Mr. POLLARD** (Lalor) [8.51.- This very important clause lays down the method of determining the policy that shall be pursued by the corporation, or, in other words, the commissioner. The commissioner will have at his disposal a consultative council, which will prob ably comprise representatives of commercial interests, but we have not yet been told who will be appointed to the council. The clause provides that the Minister must be informed of the corporation's decisions on matters of policy relating to the conduct of its business. Moreover, before adopting a policy, including an altered policy, relating to the classes of contracts of insurance into which the corporation will enter, the nature of the risks that may be covered under contracts of insurance with the corporation, and the undertaking of liabilities in relation to trade with particular countries, the corporation shall submit it for the approval of the Minister. The clause provides further that the corporation shall not adopt such a policy without the approval of the Minister or, except for such a period as the Minister permits, continue to pursue a policy which he has ceased to approve. That makes it very clear that in the making, alteration or cancelation of policy the Minister shall stand supreme. I think that the Opposition. generally, will not quarrel with that, because in the past there has been all too frequently a tendency for governments of the same political sympathy as the present Government to pass the responsibility on to other people and blame them when anything goes wrong. It is a good thing that the Minister is to stand supreme in regard to the types of business which it is proposed that the corporation shall undertake. I hope that he will make use of his powers and take a sufficiently active interest in the work of the commissioner to ensure that the policy is so shaped as to give the greatest possible service to the community. That is, after all, the purpose of setting up an instrumentality of this character. I direct the attention of the Parliament to this matter because the very Minister who now takes unto himself supreme and final power has, in the past, been most critical of the exercise of ministerial authority. I know that the honorable member for Canning **(Mr. Hamilton)** will indicate that in the past, in his opinion, Ministers have used their power and have taken full and final responsibility on a great many matters which they considered to be within their field and perogative. I know that he will say that we gave our wheat away - that we sacrificed it. What he will not say is that at that time the whole of the wheat in the Commonwealth of Australia was under acquisition and was the property of the Government. At that time, the Australian Wheat Board was representing the growers, and, knowing that final responsibility rested with the Government, evaded its responsibility and played politics. It knew that ministerial responsibility would have to be exercised. That had particular application to the vast sales of wheat that were made to the United Kingdom in 1948. When the final reckoning came and the accounts were made up, it was discovered that the wheat-growers of Australia, by virtue of the decision by the Minister of the day, in contradistinction to the recommendation of the Australian Wheat Board, had received over £2,000,000 more than they would have received had the advice of the Australian Wheat Board been acted upon. There was another famous occasion on which the Australian Wheat Board approved of a proposition to make concessions to the United Kingdom in relation to a late delivery of wheat. As a result, the Minister had to step in and make arrangements with the United Kingdom to cancel that arrangement. The result of that move was an increased profit to the wheat-growers of Australia of 6250,000. I could give a great number of illustrations of that kind. I know that the honorable member for Canning will drag up the New Zealand Wheat Agreement. That is a story in. itself. If you would allow me long enough, **Mr. Temporary Chairman,** I could tell an interesting story about it. But, even at that stage, that wheat was owned by the Commonwealth, and the Australian wheat-growers were paid cash on the nob at export parity on every shipment that was sent to the Dominion of New Zealand by the government of the day. Not many of the members of the Australian Country party, including the honorable member for Canning, cared twopence that the increased costs resulting from the recommendation of the Minister to the decision of the government of the day that the indebtedness be charged to Consolidated Revenue had to be borne by the taxpayers. They were only concerned with political capital. After all, at the date when the arrangement was made and twelve months before it was disclosed, it was recognized by authorities in the wheat world that the deal was satisfactory in the circumstances existing at that time. No wheat-grower lost a penny by virtue of that deal. 1 will leave that at that. The Minister will appreciate that when responsibility comes his way, it is his duty to shoulder it and accept any blame or praise which may follow from his action. I have always done so and I make no apologies for it. The verbiage of this clause is satisfactory. It is 8 verbiage which allows the ministerial power to be very flexible indeed. When a. government is setting out on a policy in respect of which only experience will determine what will finally be required in regard to this activity, it is essential that there should be very great flexibility. I know, furthermore, that the bill provides that the corporation must report to the Minister, I think, at three-monthly periods. That comes into another clause so I shall leave it at that. I have only taken this opportunity to point out that it is very satisfactory to see a change of heart, on the part of the Minister for Trade who formerly was highly critical of the assumption of ministerial responsibility and, consequently, of direct responsibility to the people of this Commonwealth rather than, as formerly advocated by him, the pushing of the responsibility on to somebody else who bad no ministerial responsibility. **Mr. HAMILTON** (Canning) [8.161.- Due to the fact that the honorable member for Lalor **(Mr. Pollard)** who preceded me brought me a3 the honorable member for Canning into his remarks on clause 11, I feel that I would like to say something on it. The honorable member has criticized the Minister for Trade **(Mr. McEwen"! because of the Minister's previous opposition to ministerial control. What the Minister for Trade has always argued has been that whilst it is obligatory on the Minister to be responsible for policy, it is the responsibility of the board, corporation or other body to put that policy into effect. It is the responsibility of that body to determine what type of details should be adopted.** But the honorable member for Lalor will remember that, prior to his assuming office as Minister for Commerce and Agriculture, wheat was acquired from the wheat-growers under national security regulations and the deal with New Zealand to which the honorable member referred would never have been disclosed had it not been for the pertinacity of the present Minister for Trade supported by members of the Australian Country party. If they had not been able to keep in contact with their comrades in New Zealand this matter would never have been known and the wheat-growers would have suffered a loss as the result of the nefarious deal that was entered into by the predecessor of the honorable member for Lalor. I can hear the honorable member for Scullin **(Mr. Peters)** barking away. Honorable members will recall that the honorable member for Hunter **(Mr. James)** has repeatedly complained about the babble that goes on behind him. He has repeatedly blamed the honorable member for Mallee **(Mr. Turnbull).** It is the croaking voice of the honorable member for Scullin which has been causing the discomfiture of the honorable member for Hunter. *Honorable members interjecting,* {: #debate-28-s2 .speaker-JRJ} ##### The TEMPORARY CHAIRMAN (Mr Bowden:
GIPPSLAND, VICTORIA -- Order! Far too many people are talking at once. {: #debate-28-s3 .speaker-KGC} ##### Mr HAMILTON: -- That croaking voice of the honorable member for Seullin annoys- {: .speaker-KXZ} ##### Mr Peters: -- I rise to order. Is the honorable gentleman discussing a wheat agreement with New Zealand, or myself, or a bill in connexion with the proposed Exports Payments Insurance Corporation ? The TEMPORARY CHAIRMAN.Order! He has been pointing out the disabilities that can occur under a bill of this kind. The subject of wheat was referred to by the honorable member for Lalor **(Mr. Pollard).** The honorable member for Canning has a perfect right to reply. I will not permit general dis cussion on this subject, but the honorable member may make a passing reference to it and get back to the hill. {: .speaker-KGC} ##### Mr HAMILTON: -- Before the honorable member for Scullin rose to order, *i* was making a passing reference to him, and he would not allow me to continue. But the honorable member for Lalor has expressed his pleasure at the inclusion of sub-clause (2.), paragraphs (a), *(b)* and (c), in this measure which places on the Minister the responsibility for laying down policy. Nobody will quibble on any side of this chamber at that because if the Minister has to have the responsibility of informing his colleagues in Cabine how any piece of machinery is to work, it is up to him to shoulder the responsibility for that machinery. But once having determined policy, it is within his jurisdiction to delegate his authority to the corporation to carry out details involved in the operation of that machinery. But I notice that the honorable member for Lalor, suitably, I say, evaded making any mention of sub-clause (4.) of thi? clause which states as follows: - >Nothing in this section shall be construed as requiring the approval of the Minister to the entering by the Corporation into a particular contract of insurance - A particular contract of insurance ! But the words to follow are still more important. They are - or as empowering the Minister to determine that the Corporation shall or shall not enter into a particular contract of insurance, . . . And this is where the honorable member for Lalor and I differ, because I well recall that while he was a Minister of the Crown, and had various obligations to see that certain boards operated satisfactorily, he had incorporated in legislation for which he was responsible a provision that if the chairman of the board he was responsible for establishing disagreed with the other members of that board, and that chairman reported the disagreement to the Minister - that is. at that time, to the honorable member for Lalor - within 24 hours of its occurrence, the Minister himself would take it on his shoulders to say what the board should or should not do. That is the difference between us. Under this bill the Minister admittedly will have the responsibility of determining policy. The bill provides that if there should be a disagreement between the Minister and the corporation in the formulation of policy, finally tha Minister must take the responsibility of declaring policy. Once having done that he will, in accordance with the principle in this bill say to the corporation, " The job is yours ". But the Labour party want to follow the principle of having Ministerial control to its ultimate conclusion, and dictate to the members of a board or corporation on the question of with whom they shall deal and with whom they shall not deal, and how they should deal with those with whom they deal. That is the big difference between this legislation and the Labour Government's legislation, and it is futile for the honorable member for Lalor to hark back to the past and drag up arrangements with the United Kingdom, the wheat agreement with New Zealand, and so forth. Let him look at his own dairy industry legislation. Let him look at the beef legislation that he introduced, and the egg legislation he introduced ; finally, let him look at his leader, the right honorable member for Barton **(Dr. Evatt),** who was the under-lying master mind in this principle of complete ministerial control which the Labour party espouses, so that it would fit in with his barn-storming all round the world, pandering and kotowing to small nations that did not mean twopence to the British Empire and this country. I am glad that this legislation is written as it is, and I assure the honorable member for Lalor that if he can derive any pleasure from this provision which throws responsibility on the Minister, let him take that pleasure; but I want to say quite frankly to him - and I think my colleagues would agree with me - that under this legislation the Minister will be concerned only with policy. Once policy has been declared, the whole of the job will be the responsibility of the members of the corporation. {: #debate-28-s4 .speaker-JAG} ##### Mr CREAN:
Melbourne Ports -- I would suggest that the clause we are considering, in the form in which it is written, arises to some extent out of the observations made recently by the Public Accounts Committee in regard to the Australian Aluminium Production Commission. Here, **Mr. Temporary Chairman,** we have a bill which purports to set up a corporation, and I take it that " corporation " is intended to imply some distinction from the usual departmental form of organization. The Minister for Trade **(Mr. McEwen)** himself said in his speech - >An important feature of the proposals is that the Minister is removed from matters of day-to-day administration of the corporation. The relationship between the Minister and the corporation is clearly defined in clause 11 of the bill. That is the clause under review. Now, **Mr. Temporary Chairman,** I would suggest that anybody who thinks he can simply cut the Gordian knot that hinds what might be called day-to-day administration on the one hand and policy on the other is attempting the impossible; and to suggest that the matter has been clearly defined in clause 11 of this bill, as the Minister did, is merely to play upon words. Where does policy begin, and day-to-day administration end? I was chided, last night, by the honorable member for Mitchell **(Mr. Wheeler)** when he suggested that 1 was wrong when I said that this form of insurance did not cover changes in currency exchange levels. I would simply ask the honorable member to read a clause that we shall consider in a few minutes. I refer to clause. 13, and particularly to sub-clause (2.). I suggest that what will determine the operation of this legislation will not be what the Minister said in his secondreading speech, but, at some time in the future, what a court may determine particular words of the statute mean. That is the line of distinction that has to be drawn, instead of simply attempting to define what is policy on the one hand and day-to-day administration on the other. If I may anticipate, **Mr. Temporary Chairman,** I should like to say that the two operative clauses of this bill are clause 11 and clause 13, read in conjunction. Clause 11 determines the relations of the corporation with the Minister, and clause 13 is supposed to set out the powers and duties of the corporation. Sub-clause (2.) of clause 13 provides an illustration of the kind of difficulty that I think the Minister may find in determining what he calls policy, as distinct from day-to-day administration, and, if I may, **Mr. Deputy Chairman,** I will read clause 13 (2.). lue TEMPORARY CHAIRMAN.How Long is it? {: .speaker-JAG} ##### Mr CREAN: -- Eight or nine lines. It reads - >The contracts of insurance which the Corporation may enter into under this section are contracts of insurance with, or for the benefit of, persons carrying on business in Australia, being contracts of insurance against risk of monetary loss or other monetary detriment attributable to circumstances outside the control of the person suffering the loss or detriment and resulting from failure to receive payment in connexion with, or otherwise arising out of, acts or transactions in the course of. or for the purpose of, trade with countries outside Australia. I would simply ask whether, when an individual enters into a contract with the corporation, there is to be written into his policy this kind of provision, that the contract does not cover variations in exchange. That may be something that is done; but, assuming it is not done, could anybody deny that a variation in exchange would constitute a monetary detriment not attributable to circumstances within the control of the person concerned? Where lies this narrow line, which the Minister says is clearly defined in clause 11, between policy on the one hand and day-to-day administration on the other? I would submit that the statutory corporation is an interesting form of administrative arrangements in relation to certain activities; but it is extremely doubtful, in the long run, whether the statutory corporation, as such, when it is linked to constitutional limitations in Australia, does possess any advantages that do not appertain to the ordinary departmental organization. I suggest that the Minister is attempting to get the best of both worlds. Honorable members opposite subscribe to the philosophy of private enterprise, as distinct from that of public organization. It must be remembered, however, that even they admit that this is a field that private enterprise will not enter. It is suggested that the proposed corporation will have the advantages of business administration, and will be removed from the ordinary red tape of departmental organization. As I see it, what is loosely described as bureaucracy arises from the fact that there are weak and inefficient Ministers, who do not know precisely what is going on and who are prepared to rely upon departmental officials for advice on many important questions. The ultimate test in these matters should be that of parliamentary responsibility, which makes it possible to sheet home responsibility to a particular Minister, who, directly as the head of a department, or indirectly as the Minister responsible for a particular corporation, is supposedly responsible for acts that are committed. I suggest that, by including the provisions of clause 11, the Minister is leaning in the right direction. As my colleague, the honorable member for Lalor, has suggested, major policy matters should be the responsibility of the Minister, who is answerable to the Parliament. I think that the Minister is flying in the face of experience if he believes that by including the provisions of clause 11 he has cut the Gordian knot, and that the relationship is clearly defined. I was a member of the Public Accounts Committee when it investigated the activities of the Australian Aluminium Production Commission, I am not arguing about who introduced the original legislation or who subsequently amended it, but one thing that was not clearly defined in the legislation which established the Aluminium Commission was the line of responsibility from the commission to the Minister and ultimately to the Parliament. In that case, an attempt was made to shelter behind certain sections of an act. It was said that some matters, constituted a part of the day-to-day administration of the commission and that other matters were matters of policy for the Minister. In this clause, an attempt is made to define major policy, and to leave what is called day-to-day administration to the corporation. Any one who thinks that we can simply say that certain acts are matters of policy and that other acts form part of day-to-day administration, and that there is no intermingling or overflow from one to the other, i3 being a little optimistic about future circumstances. {: #debate-28-s5 .speaker-KWP} ##### Mr TURNBULL:
MALLEE, VICTORIA · CP .- My colleagues have dealt very effectively with this measure, and T do not wish to add to what they have said. I should not have risen to speak but for the fact that the honorable member for Lalor **(Mr. Pollard)** made a remark which, if not corrected, might be believed by certain persons, especially certain honorable members who were not here at the time to which he referred. I refer to the honorable member's remarks about the wheat deal with New Zealand. The honorable member, in the grand manner, waving hia hand, said that not one wheatgrower in Australia lost a penny as a result of that deal. Nothing could be further from the truth, for the simple reason- The TEMPORARY CHAIRMAN.Order ! {: #debate-28-s6 .speaker-KWP} ##### Mr TURNBULL: -- I can answer that statement, surely. The TEMPORARY CHAIRMAN.The honorable member had better make his answer very brief. Even though that matter has been mentioned, I rule that it may not be debated when considering this clause. The honorable member may make a brief reference to it. {: .speaker-KWP} ##### Mr TURNBULL: -- Can I not finish the sentence? Opposition Members. - No ! The TEMPORARY CHAIRMAN.Order ! {: #debate-28-s7 .speaker-KWP} ##### Mr TURNBULL: -- I shall finish the sentence. Nothing could be further from the truth, for the simple reason that the loss was met by the Australian taxpayers. The wheat-growers, as big Australian taxpayers, lost millions of pounds as a result of the deal. {: .speaker-BV8} ##### Mr Calwell: -- The honorable gentleman certainly contributed nothing to the debate. {: .speaker-KWP} ##### Mr TURNBULL: -- But I put the honorable member right. {: #debate-28-s8 .speaker-KDA} ##### Mr DUTHIE:
Wilmot .- I certainly agree with the statement of the honorable member for Melbourne **(Mr. Calwell)** that the honorable member for Mallee **(Mr. Turnbull),** in trying to contradict the remark of the honorable member for Lalor **(Mr. Pollard),** contributed nothing whatever to the debate. {: .speaker-KWP} ##### Mr Turnbull: -- I contradicted the remark very effectively. {: .speaker-KDA} ##### Mr DUTHIE: -- The honorable member is the only one who thinks that his reply was effective. {: .speaker-KDS} ##### Mr Failes: -- No, there were a lot more of us who did. {: .speaker-KDA} ##### Mr DUTHIE: -- Clause 11 puts the seal of socialism on this measure. No matter how supporters of the Government may try to argue themselves out of the situation, they will have put themselves fairly and squarely within the ambit of socialistic enterprise when they finally agree to the measure. The introduction by the Government of such a measure, which gives to the Minister for Trade **(Mr. McEwen)** almost complete control of the running of this corporation, forms an interesting commentary on the Government's general attitude towards government enterprise as opposed to private enterprise. Opposition members believe that, in the national interest, there should be a certain amount of government enterprise. It is ironic that, on this occasion, big business and big exporting interests that have been so loud in their support of this private enterprise Government, and in their criticism and expressions of hatred of all forms of socialism, should have persuaded the Government to introduce a socialistic measure that is designed to try to rescue them from the ruthless competition of other people who also worship at the footstool of the god of private enterprise. The introduction of such legislation is the funniest thing that we have seen in the House for a long time. What does the Government's reversal of form mean ? It means that all supporters of the philosophy of *laisser-faire* still believe in this principle: "Let us individualize our gains and socialize our losses ". What is the purpose of this bill other than to socialize the losses of the exporters ? {: #debate-28-s9 .speaker-10000} ##### The TEMPORARY CHAIRMAN: -- Order ! The honorable member should not deal with the bill as a whole. He should deal only with clause 11 {: .speaker-KDA} ##### Mr DUTHIE: -- I am dealing with clause 11. {: .speaker-10000} ##### The TEMPORARY CHAIRMAN: -- The honorable member may not make a second-reading speech. {: .speaker-KDA} ##### Mr DUTHIE: -- I shall handle it, **Mr. Temporary Chairman,** as I think fit. As the previous speaker spoke about a wheat deal with New Zealand, I cannot see that 1 am very far off the track when I speak about the philosophy to which expression is given in the clause, which provides for the setting up of a socialist corporation to insure those who export goods to other countries. Actually, I think that I am right on the beam. It will be noted that, under the provisions of the clause, the Minister for Trade has three important things to do. First, he has supreme control over the classes of contracts of insurance into which the corporation shall enter; secondly, he must decide the nature of the risks that may be covered under contracts of insurance with the corporation - which is a major issue ; and, thirdly, he is responsible for the undertaking of liabilities in relation to trade with certain countries. What I am trying to stress in relation to this clause is that those three heads of power give to the Minister complete control of a Government corporation or enterprise. That is something which this Government has always criticized. The persons who criticize this type of arrangement are now running to the Government asking it to rescue them from troubles which they expect in the future. They say, " Let us insure our goods so that we can increase our trade with other countries ". To us. that is an amusing situation. That is why I say again that people of this type, who desire to have a shilling each way, are really individualizing their gains and socializing ther losses. I therefore support honorable members on this side of the .committee who agree that this is a rightful course for the Government to take. I know that honorable members opposite will not vote with enthusiasm for this clause, even though we do not divide on it, because they know that what 1 have said about it is true. In this instance they will agree to it for the sake of uniformity within their parties. They will place their seal of approval on a socialistic measure of a type which they have criticized throughout the years as being of the essence of Australian Labour party policy and principles. I remind honorable members opposite of that fact. {: #debate-28-s10 .speaker-KYC} ##### Mr POLLARD:
Lalor .- The honorable member for Canning **(Mr. Hamilton),** after making an affirmation of his belief that clause 11 (4.) limits the Minister's power, left the chamber. I am sorry that he is nol; here now, because I desire to direct his attention to the fact that the Minister is not really limited at all. I look upon clause 11 as a very cleverly drawn clause, a tribute to the capacity of the draftsman and a. credit to those who designed it to have the meaning interpreted by the honorable member for Melbourne, Ports **(Mr. Crean).** In other words, the clause specifies broadly the manner in which this corporation may be allowed to carry on its work. It refers, in the first place, to policy. In the second place, it indicates that the corporation, in its administration, should be left possibly - it does not state definitely - to its own devices. There is no clear definition of where the Minister begins and the corporation ends. Clause 31 (4.) states - >Nothing in this section shall be construed as requiring the approval of the Minister to the entering by the Corporation into » particular contract of insurance . . . The provision shall not be construed as requiring the approval of the Minister to such action by the corporation. It does not state that the corporation must have the approval of the Minister. There is nothing definite about it. The clause continued - {: type="i" start="1"} 0. . or as empowering the Minister to determine that the Corporation shall or shall not enter into a particular contract oi insurance. The clause does not state that the Minister shall be so empowered. It simply states that it shall not be construed definitely one way or the other. That is my interpretation of the clause. It is a common-sense sort of guidance to the Minister and the corporation. If the honorable member for Canning had read the preceding sub-clause he would have seen reference to disagreement regarding policy. In the event of such a disagreement, the Minister finally comes out on top. However, it is much ado about nothing. All that I am endeavouring to demonstrate is that, finally and conclusively, either in administration or policy, the Minister must come out tops, and that the clause, with all its sub-clauses, is in reality a guide to common-sense formulation of policy and subsequent administration by the corporation. That is all there is to it. I am very sorry that the feelings of the honorable member for Mallee **(Mr. Turnbull)** are so sensitive. On the very point about which he made an explanation, I have already told the Parliament that, in respect of the New Zealand wheat agreement, wheat-growers, in their capacity as taxpayers paid their share through the Consolidated Revenue Fund. {: #debate-28-s11 .speaker-JLU} ##### Mr ANDERSON:
Hume .- In the absence of my colleague, the honorable member for Canning **(Mr. Hamilton),** I should like to correct the honorable member for Lalor **(Mr. Pollard).** The honorable member for Canning said that clause 11 (4.) specifically stated that the Minister had no right to interfere in individual cases. That was the point that he made. The Minister has a right to approve policy, but no right to say, in respect of individual cases, whether the corporation shall or shall not effect insurance. In reply to the honorable member for Wilmot **(Mr. Duthie),** I can see nothing socialistic in the first three sub-clauses about which he spoke. I do not think that the honorable gentleman really understands the meaning of socialism. I repeat, for the benefit of the honorable member for Lalor, that in my view the interpretation of clause 11 (4.) by the honorable member for Canning was correct, that is, that the Minister cannot take notice of individual cases. He prescribes policy and policy alone. {: #debate-28-s12 .speaker-JSU} ##### Mr BRYANT:
Wills .- I should like, in reply to the honorable member for Hume **(Mr. Anderson),** to amplify or reiterate the comment of the honorable member for Melbourne Ports **(Mr. Crean)** who pointed out that it would be virtually impossible to define from day to day where policy starts and administration matters end. The subclause states that the corporation shall not enter into a particular contract of insurance unless the contract is in accordance with policies approved or determined by the Minister under this section. That, of course, gives the Minister over riding power to declare every policy, if he wishes, and that is a very sound procedure. We are pleased that the Government is at last appreciating some of the aspects of Parliamentary democracy, and that advocacy from this side of the chamber of acceptance of ministerial responsibility and so on is at last having some effect. There is no confusion about the matter, and nothing that the honorable member for Hume, the honorable member for Canning **(Mr. Hamilton)** or any other honorable member can say can take away the vagueness from the first part of sub-clause (4.) and deny the spirit and meaning of the last part of it, which provides that the Minister, by his day to day definition of policy, can, in effect, say precisely what shall be done in particular cases. I hope that that is the spirit in which the provision will be administered. {: #debate-28-s13 .speaker-KDS} ##### Mr FAILES:
Lawson -- I am very pleased that honorable members of the Opposition who have spoken are sitting in the Opposition benches and not in the courts of this country, because their interpretation of some of the subclauses of this bill lead me to fear what might happen if they were judges interpreting those provisions. Admittedly, much of our legislation is not very clear, but clause 11 is so obviously clear that I cannot believe that anything other than political motives would impel honorable members opposite to speak as they have spoken. Sub-clause (2.) obviously prescribes the classes of contracts and the nature of risks and undertaking of liabilities in respect of which the corporation shall submit policy to the Minister' for his approval. Sub-clause (3.) clearly prescribes that if there is any doubt, or if the corporation or Minister cannot agree, the Minister has the final say. Somebody must have the final say. In sub-clause (4.) I can see nothing to lead anyone to believe that it contains other than a statement that the Minister shall not have to give approval for any particular contract. Clause 11 is very valuable. I give due respect to Ministers of the Crown, but there are times - this applies particularly to a corporation of this sort - when the finger of suspicion may be pointed at a commissioner or a Minister and it may be suggested that some one is getting a rake-off as an inducement to the allowing of a contract that is not a good risk. This clause very clearly removes from any form of political control the acceptance or rejection of risks that the corporation might be asked to accept. Therefore, it is very wise. It puts the responsibility on *the commissioner,* and, through him, on the corporation. He will be advised by a body, which is provided for in another clause, about the classes of risks to be accepted. Risks shall not be accepted Unless they are approved. The clause eliminates any possibility that a Minister may, perhaps, accept a bribe and direct the corporation to accept a particular risk. The honorable member for Wilmot **(Mr. Duthie)** and other speakers have suggested that the Government exhibited some socialistic intent by the inclusion of this clause in the bill. {: .speaker-JSU} ##### Mr Bryant: -- Not intent. {: .speaker-KDS} ##### Mr FAILES: -- I repeat, some socialistic intent. It has been said that the Minister for Trade **(Mr. McEwen),** who objected to ministerial control over boards when he was Minister for Commerce and Agriculture, has included in this bill a clause that provides for ministerial control over the corporation. The two things are as wide apart as the poles. In the one case, we have a board such as the Australian Wheat Board, which disposes of the producers' product. Naturally, members of the Australian Country party, and I personally, have taken very strong exception to ministerial control of such a board. The sale of wheat under ministerial control has been mentioned this evening. The sale of the producers' product by a Minister, or under the direction of a Minister, is totally different from ministerial control of a corporation that can call upon £25,000,000 of the people's money to honour guarantees given by it. Whenever the people's money is involved in a matter such as this, it is perfectly logical and right for the Minister, as a representative of the Crown and of the people, to have some say, as is provided for in the hill. There should be no more quibbling about the matter. The measure is not socialistic because it gives a Minister the right to control a corporation that can call upon £25,000,000 of the people's money to honour guarantees. The provisions of clause 11 are very logical to my mind, and, I think, to the minds of honorable members generally, and I cannot understand the quibble that has been raised. {: #debate-28-s14 .speaker-JAG} ##### Mr CREAN:
Melbourne Ports . There seems to be some doubt about clause 11. The honorable member for Lawson **(Mr. Failes),** who has just resumed his seat, has suggested that it is a wise clause. Some honorable members have suggested that it is a wide clause. I am inclined to think it is really a narrow clause. 1 ask the committee to read it in conjunction with sub-clause (3.) of clause 13, which reads - >The Corporation shall not enter into contracts of insurance under this suction against risks that arc normally insured with commercial insurers. If the corporation is to enter into contracts of insurance against risks that are not normally insured with commercial insurers, just how wide is the field it is to cover? If, as I suggest, the field is circumscribed to begin with, precisely what is meant by the provision, in subclause (2.) of clause 11, concerning the classes of contracts of insurance into which the corporation will enter? How wide is the ambit of those classes of insurance, when the field is narrowed, in the first instance, to categories that are not normally covered by commercial insurers? Secondly, the Minister for Trade **(Mr. McEwen)** will be able *to* adjudicate upon the nature of the risks that may be covered under contracts of insurance. Finally, he will be able to negotiate about, or determine as matters of policy, the undertaking of liabilities in relation to trade with particular countries. As T indicated earlier, the two operative clauses are clause 11 and clause 13, which must be read in conjunction. Clause 11 attempts to do the circus trick of circumscribing day-to-day administration as distinct from policy. But, *even* there, policy works within, the narrow ambit of what are regarded as risks other than those that are normally insured with commercial insurers. The Government attempts, in sub-clause (2.) of clause 11, to narrow the field into three further categories by the provisions relative to the classes of contracts of insurance, the nature of the risks, and the undertaking of liabilities in relation to trade with particular countries - each in itself very much circumscribed. However, statistics published in a document issued by the Export Credits Guarantee Department of the United Kingdom as recently as 1955, which outlined the history of this kind of insurance in Great Britain, show that, in 193S, the United Kingdom scheme having been in operation since 1919, there were only 600 separate insurers. The Australian scheme has not even started, and I suggest that, even after twenty years of operation in this country^ on a *pro rata* basis according to population, there would be perhaps 100 separate insurers. So where does subclause (4.) of el a use 11 get us in the initial stages of the operation of this measure? That sub-clause provides - >Nothing in this section shall be construed as requiring the approval of the Minister to the entering by the Corporation into a particular contract of insurance . . . I suggest that the early years of the corporation will involve adjudication between particular kinds of individuals who seek insurance from the corporation. T suggest, also, that, as a matter of administrative organization, that is the kind of pattern we can expect to be followed in the early years. That is why it seems to me that, when the Minister airily suggests that he has disposed of what he calls day-to-day administration as distinct from policy and that subclause (4.) distinguishes between what might be called the individual application and, let us say, categories of applications, he envisages something that may not occur for a great many years in the operations of this corporation. I suggest that the committee should not merely consider the operations of the corporation in the initial stages in comparison with the operations of a similar scheme in Great Britain for more than 30 years, and in Canada for more than ten years. We should endeavour, this evening, to protect ourselves in the early stages - the embryonic stage, if one likes - of the development of this corporation. I do not know how many exporting firms there are in Australia at present, but I suggest that there are not a great many. How many of them will rush into this scheme immediately it is instituted? I incline to the view that the number will be very limited, and, further, that, in the initial stages of the scheme, the corporation will largely be adjudicating on individual applications that come before it. {: #debate-28-s15 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP . - The attitude of the Opposition to this clause seems to me to reflect its attitude to the whole bill. It approves of the bill and of the intention, as any sensible Australian must, but it finds it too difficult to say so and seeks means of criticism and disapproval. The members of the Opposition who have spoken on this clause to-night seem to be in singular disagreement with each other. The honorable member for Lalor **(Mr. Pollard)** spent his time delving into the past - old wheat contracts and other controversies. This bill deals with the future, not the past. It breaks into an entirely new field and it is a genuine attempt to assist Australian industry and commerce. The honorable member for Melbourne Ports **(Mr. Crean)** took my colleague, the Minister for Trade **(Mr. McEwen^ to** task. {: .speaker-KYC} ##### Mr Pollard: -- Is the Minister going to deal with the clause or is he going to ramble over the whole debate? {: .speaker-KMD} ##### Mr OSBORNE: -- I am answering the arguments put forward on this clause. The honorable member for Melbourne Ports took the Minister for Trade to task for presuming to think that he has solved the difficulty of .deciding between policy and administration. This clause, so far as it goes, deals admirably and clearly with the functions of the Minister and of the corporation. What are the decisions of policy with which the clause deals? They are policies approved or determined by the Minister under this provision. What is the right of the Minister to approve of policies under this provision? It is the right to determine the classes of contracts of insurance, the nature of the risks and the countries with whom the trade is done. Then subclause (4.) states that " Nothing in this section shall be construed as requiring the approval of the Minister to the entering into by the corporation of a particular contract of insurance ". {: .speaker-KYC} ##### Mr POLLARD: -- It does not *say he* shall not. {: .speaker-KMD} ##### Mr OSBORNE: -- The Minister's right to deal with questions of policy is set out in sub-clause (2.) and the right of the corporation otherwise to decide what contracts it shall enter into is saved by sub-clause (4.). The general purpose of this clause is perfectly clear to anybody who reads it. It is to provide the maximum autonomy for the corporation in its activities, consistent with proper ministerial responsibility for broad policy. Let me deal again with sub-clause (2.) and the matters that the Minister has the right to determine, the classes of contracts of insurance. The Minister has said in his second-reading speech that lie contemplates that there will be two main types - shipment of material in which the risk runs from the date of shipment and contract policies which will assist manufacturers to make special goods to special orders and to insure the possibility of those goods being rejected. They are the types of risk to be covered. The Minister has said what they will be. They include the insolvency of the buyer, the failure of the buyer to pay the exporter within twelve months, and the operation of a law, order, decree or regulation in circumstances outside the control of the buyer which prevent the transfer of payments from the buyer's country to Australia. They include the risk of war between the buyer's country and Australia, or of war in the buyer's country which prevents him from fulfilling his contract. The Government intends that they will cover any other cause excluding particular risks, which f shall deal with in a moment, not being within the control of the exporter or of the buyer which arise from events occurring outside Australia. The Government does not intend that they shall cover this class of risk - refusal of a solvent buyer to accept delivery, nonpayment for goods on consignment and fluctuations in the rate of exchange. The reason why they are not covered is that the normal banking procedure provides means for covering those risks. The TEMPORARY CHAIRMAN.Order ! The Minister is not dealing with the clause now before the committee. {: .speaker-KMD} ##### Mr OSBORNE: -- I am dealing with the types of risk, which is covered by clause 11. {: .speaker-10000} ##### The TEMPORARY CHAIRMAN: -- Order! Clause 11 deals with the relation of the corporation with the Minister. {: .speaker-KMD} ##### Mr OSBORNE: -- Sub-clause (2.) of clause 11 defines the classes of contract,, the nature of the risks and the undertaking of liabilities in relation to trade with particular countries. I am speaking about the classes of contracts and the nature of the risks, and what the Government's intentions are in relation to them.. Indeed, I suggest that I am talking precisely about the clause, whereas the discussion for the last half an hour or so has been very wide of it. Other matters which the Government does not intend to cover are in respect of goods shipped from Australia and additional handling or transport charges occasioned by the interruption or diversion of ships on voyage, because they are covered by ordinary commercial policies. In general, any other risk which can be covered by commercial, insurance is expressly removed from the provisions of this bill. Clause agreed to. Clause 12 (Consultative Council). {: #debate-28-s16 .speaker-KYC} ##### Mr POLLARD:
Lalor .- Clause 12 is an important clause. I hope the Minister for Customs and Excise **(Mr. Osborne)** will not be as annoyed about our criticism of clause 12 as he was about our criticism of clause 11. All he is anxious about is getting home early to bed. He does not care ; he does not want the Opposition to criticise or to seek information. If he had his way, he would make a dictatorship out of this Government and shut the whole of Parliament up. Clause 12 is worthy of some discussion. It provides that under the act there shall be a consultative council consisting of not more than ten members. Why it should be ten, I do not know. Why fewer than ten should be the number appointed, if the Minister thinks fit, I do not know either. Overall, the Opposition does not generally disagree with the creation of a consultative council, but, if the Minister can regain his temper, we are entitled to know what is in the mind of the Government regarding this consultative council. There is no provision in the bill to indicate that the members of the council will be drawn from some specific organizations, representing primary producers, manufacturers, and the commercial insurance world. They may be drawn from some judiciary or some other source that may be in the mind of the Government, or from the trade unions that are concerned. There is not a word about that. No information is conveyed in the second-reading speech of the Minister for Trade **(Mr. McEwen).** All I can see going on at the moment is a rude conversation between the Minister and the Vice-President of the Executive Council **(Sir Eric Harrison),** who are probably deciding exactly when they will gag this debate and prevent any further discussion on this measure. {: .speaker-KMD} ##### Mr Osborne: -- We are discussing the bill: {: .speaker-KYC} ##### Mr POLLARD: -- I am trying at the moment to learn what is in the mind of the Government in the creation of this consultative council. How is it to be constituted? In what interests are its members supposed to be expert? Will it have representatives from the people to be insured or will it be a council representing, perhaps, the people who are likely to be purchasers? No information has been furnished to this committee. Not a word has been said about that in the Minister's second-reading speech, and there is no indication in the bill itself. It would be courteous on the part of the Minister to inform the committee what the Government's intentions are. He could say that a consultative council will be appointed, that six members will be enough at present and that they represent wheat-growers, wool-growers, tin-can manufacturers or some other interests. He could tell us whether some body experienced in commercial insurance will be appointed and whether there will be a representative of the State governments, the Treasury or the Department of Trade. We would then know what is running in the mind of the Government and how it proposes to be advised, but not a word has been said about it. This clause provides that members of the council will be appointed for three years - and that is another reason why we should know what is in the mind of the Government. The members of the council are to be paid fees and expenses, but there is no indication of what fees they will be paid. After all, the corporation has to pay the fees out of its income and, if its income is insufficient, the taxpayers of the Commonwealth of Australia are to be drawn upon to pay them. We are told that members may be removed from office and we are given the reasons for which they may be removed. We are told also that the commissioner may at his discretion consult this council. If the commissioner is a strong-headed man, like the Minister himself, he may decide that he knows all about the matter, and he may never consult the consultative committee. In that case we would have in existence a committee, with members being paid fees and allowances, that would not be worth a dump. It is provided that the commissioner may, at his discretion, and shall, as required by the Minister, refer matters for advice to the consultative council. The commissioner, however, is left as a freelance, and the consultative committee may be a completely superfluous body, except when the Minister may become a little annoyed and say to the commissioner, " Call your council together and consult it on certain matters that I think it should consider ". Complaints may be received from exporters who cannot get the cover that they want. In that case the Minister may wish to ascertain whether the commissioner is doing the right thing, and he may say to him, " Call your consultative council together and refer these matters to it ". Surely we can be given some more information than has already been furnished to the Parliament. All that the Minister for Customs and Excise **(Mr. Osborne)** does is to point to the clock, to indicate that my time is running out. It may also indicate that the Government intends to gag this debate before it proceeds very much further. The debate has proceeded as a perfectly friendly discussion. We are supporting this measure. We want jp be fully informed, and I am merely asking for information about the matters that I have mentioned. I know that the Minister for Trade **(Mr. McEwen)** is labouring under a difficulty. He is making arrangements to go abroad, to endeavour to obtain some further markets for our goods, in order to improve the position of our trade balance. He may do good work, and he may not. Personally, I have grave doubts as to whether he will. Because he is getting ready to go away, the Minister for Customs and Excise is in charge of this measure, and he may not know anything about it at all. He has to do the best he can, however, and surely he knows something about this legislation. Surely he has been properly briefed. Surely he knows some of the things that are in the mind of the Minister for Trade. We are entitled to have some information from him. As no other honorable member has risen, I shall take my second period now. Unless we can get some information from the Minister for Customs and Excise about clause 12, I shall feel inclined to provoke some of my friends to express their opinions, not only in regard to this clause but also in regard to other clauses. If the Minister proposes to be discourteous and not to recognize that the Opposition is trying to be helpful and is endeavouring to play its part in this matter, then we shall have to keep on prodding him. Clause agreed to. Clause 13- (1.) The Corporation shall, subject- to this Act, carry on the business of insurance, being insurance under contracts referred' to in the next succeeding sub-section. (3.) The Corporation shall not enter into contracts of insurance under this -'section against risks that are normally insured with commercial insurers. **Mr.** POLLARD (Lalor) [9.131- This is the clause to which the Opposition proposes to move an amendment. This portion of the bill sets out the particular forms of insurance in which the corporation may engage, and the cover that the commissioner may give to the people who desire to take out insurance. The particular kinds of insurance are outlined, and sub-clause (3.) then provides - >The Corporation shall not enter into nontracts *of* insurance under this section against risks that are normally insured with commercial insurers. It is well known that the real reason for the proposed establishment of this corporation is that hitherto no commercial insurance companies have seen fit to enter this field. Apparently they have considered it unprofitable, or at least as' being too risky at present for them to venture into. For that reason the Australian Government has come to the rescue - quite rightly - and proposes to establish a corporation to provide insurance to cover these very risky transactions. It is proposed to make available £500,000 of the taxpayer's money for establishment purposes. Provision is made to guarantee the activities of the corporation to the amount of £25,000,000 at any particular time. It is hoped, as is shown by a later proviso in the bill, that the corporation will balance its revenue with its expenditure, but it may well be that in the initial stages of the venture there will be substantial calls upon the Consolidated Revenue. I suggest that if this Government had any vision it would remove this limiting provision in the clause, and I now move - >That sub-clause (3.) be omitted. I do so in order that the corporation may be allowed to engage in all forms of insurance covering export activities, such as marine insurance, pillage insurance, insurance against fire or shipwreck, and other kinds of insurance normally undertaken by private insurance companies because they are profitable. If the amendment is agreed to, the spread of risk will be greater, the possibility of requiring a lesser premium from the insurers will be much better than it is today, and the corporation will be in a much sounder and more solvent position at an earlier date than otherwise it can possibly be. I am afraid that the Minister for Customs and Excise **(Mr. Osborne)** is rather tired to-night, or perhaps he knows little about the bill, but if he does speak he will say, as will other Government supporters, "We do not believe in setting up a socialistic instrumentality ". {: #debate-28-s17 .speaker-KXZ} ##### Mr PETERS: -- Unless it makes a loss. {: .speaker-KYC} ##### Mr POLLARD: -- " Unless it makes a loss, and as soon as an instrumentality that we establish begins to make a profit we shall sell it to some one who will reap those profits, because we do not like profits ". The Opposition is suggesting now that ordinary commercial export insurance should be a function of the proposed corporation. That would reduce the extent of a possible call upon the taxpayers, and eventually there might even be substantial profits that could go into the consolidated revenue, or, better still, be used to reduce the premiums that the insurers will be asked to pay. As to the arguments of honorable members opposite that they do not believe in a socialistic policy, surely wc can get away from party political propaganda in this matter. Let us consider what has happened in certain States of the Commonwealth of Australia from time to time, where in actual fact conservative or Liberal governments - certainly antiLabour governments - have ventured upon this kind of activity. In Victoria there is a State Accident Insurance Office, established, I understand, by a Liberal administration, whose functions were eventually enlarged to include third-party insurance cover. No conservative or Liberal government in Victoria would consider for a moment the abolition of the State Accident Insurance Office, or would consider for a moment limiting its functions. No one worries about its being a socialistic activity. All that the Liberal and Country party governments in Victoria have worried about in the past is whether it has been run successfully, whether it has made substantial rebates to the people who insure with it, and whether it has been run along sensible and businesslike lines. When the Opposition suggests that something similar should be done in this case, so that the corporation may compete for this class of business, Government supporters will talk all sorts of nonsense about socialism. All that we are trying to do is to ensure that this type of activity is made much safer financially than otherwise would be the case, by allowing the corporation to enter into other classes of business. Under the circumstances, surely the Government will show that it is at least as progressive as were the Victorian Liberal administrations of 30 years ago which actually established a State insurance office. There are to-day many State instrumentalities which have, been created as a result not of Labour legislation but of Liberal administration. These instrumentalities have been established to place a brake on the rapacity of private enterprise, which was exploiting the people. If the Minister accepted the amendment, a similar brake would be placed upon the rapacity of the people who are to-day exploiting the exporters by charging them excessive insurance premiums. Sub-clause (3.) provides that the corporation shall not enter into contracts of insurance under clause' 13 against risks that are normally insured with commercial insurers. The effect of the omission of that sub-clause would be to permit the corporation, at its discretion and subject to the Minister's approval, to embark on such form of insurance. {: #debate-28-s18 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP -- My right honorable friend, the Minister for Trade **(Mr. McEwen),** who introduced this bill, is engaged in consultations elsewhere and is unable to be present in the committee. I have discussed this matter with him and, for him, I say that the Government entirely rejects this amendment, which merely expresses the socialist objectives of the Opposition and seeks to change the whole nature of the scheme contemplated in the 'bill. The Government's intention, in bringing down this bill, is not to enter into the wide field of comercial insurance, but to provide a system of export payments guarantees. It decided to do this only when it had been convinced that the risks in overseas trade against which this bill seeks to insure exporters could not be covered by commercial insurance in Australia. The purpose of sub-clause (3.) is to make it quite clear that the corporation shall not have power to encroach upon the ordinary business of commercial insurance. The Government will not accept the amendment. {: #debate-28-s19 .speaker-JAG} ##### Mr CREAN:
Melbourne Ports .- - I should like the Minister to clarify clause 13. Clause 11 and clause 13 are the most important clauses of the bill. Clause 13 is a tripartite clause, and the Opposition has moved that the third part be omitted. The first part provides that the corporation shall, subject to the legislation, carry on the business of insurance, as defined in sub-clause (2.). This sub-clause sets out the kind .of contracts that may be negotiated. They are contracts of insurance against risk of monetary loss or other monetary detriment attributable to circumstances outside the control of the person suffering the loss or detriment and resulting from failure to receive payment in connexion with trade transactions. The third part of the clause provides that the corporation shall not enter into contracts that are normally - insured with commercial insurers. Here again, I incline to the view that the powers of the corporation will be determined, not so much by what the Minister says, as by what a court of law may say. I would even .suggest that the Minister has not been very specific about the functions of the proposed corporation. I turn now to his speech and the functions that he mentioned. First, he said that it was proposed to provide insurance broadly against the risk of non-. payment, whether arising from causes such as the insolvency of the overseas buyer or his failure to pay within a certain period, or from actions of overseas governments such as - and I would suggest that this is merely given as an example - the blockage of foreign exchange or the sudden imposition of new import controls in markets abroad. Later, in the speech, the Minister said that the corporation would insure against the insolvency of the overseas buyer, for example, or against the overseas buyer's inability to obtain foreign exchange to remit payments owed to an Australian exporter. He went on to mention risks normally insured with commercial houses. Then he said that the' corporation must put its proposed policies before the Minister and obtain his approval. That is the dilemma that obtains between clay- to-day administration, on the one hand, and policy on the other. Later, he said - >It is intended that cover should be provided initially against risks of loss due to insolvency of the oversea buyer; the failure of the oversea buyer to pay within twelve months of the due date; failure of the oversea buyer to obtain foreign exchange, or of the oversea bank to transfer funds to the Australian exporter; war, rebellion, hostilities, revolution or other disturbances in the oversea country: and any other cause outside the. control of the exporter and arising outside Australia. Last night, I asked whether the -cover applied to variations in the rate of exchange and I was promptly taken to task by a Government supporter. The suggestion made was that one could insure, oneself with the Commonwealth Bank against a variation in exchange. 1! simply make the point that the Minister has mentioned insurance houses in this connexion. Does insurance against exchange variations come within the scope of clause 13 (3.) ? Is it regarded as a matter that is normally covered by commercial insurers? Is the Commonwealth Bank, in this connotation, to be regarded as a commercial insurer? 13 that a normal function of the Commonwealth Bank? I would submit that it is not. As -I have already suggested, the powers of the proposed corporation, as set out in clause 13, are distinctly vague. It is true that under clause 11, the other operative clause, a decision can be made that this or that shall not be regarded as a matter of policy. I ask the Minister to clarify this point for me. When a policy is issued by the corporation, will there be written into it an assurance that it does cover a variation in exchange? Is it to be determined, as a. matter of day-to-day administration by the corporation, that that is something which is not normally a commercial risk? Or is it to be one of the matters referred to the Minister under clause 11? Under that clause, the Minister could say, categorically, "For my part, I do not believe that variations in the rate of exchange come within the risks set out in clause 13 ". I suggest that we are entitled to assurances on this matter. It could happen that, in a court of law, a person who had taken out an insurance policy in which there were no words specifically limiting a certain kind of activity could say, " I rely upon the normal meaning of section .13 of the Exports Payments Insurance Corporation Act, as it was passed by the Parliament of the Commonwealth in May, 1956 ". One could not, as a defence, produce the statement that the Minister had made in this chamber or the statement that the honorable member for Robertson **(Mr. Dean)** made in rebuttal of my suggestion that it did not cover this kind of activity. One might keep to the official delineation, if it were possible. One could try to adjudicate between what might be called policy on the one hand, as supposed to be laid down in clause 11, and day-by-day administration as the words in clause 13 might be interpreted. If the Minister for Customs and Excise is not in a position to give a definite answer to this question to-night, at least he should inquire from the Minister for Trade and those who have advised him as to what are the meanings. I think that we are entitled to ask, " What is monetary detriment attributable to circumstances outside the control of persons suffering the loss or detriment? In what way, if a variation in exchange be adverse to the exporter, is that transaction eliminated as far as clause 13 is concerned? If it is not eliminated as far as clause 13 is concerned, is it embraced in the interpretation of policy as laid down in clause 11 of this bill?" {: #debate-28-s20 .speaker-JSU} ##### Mr BRYANT:
Wills .- I want to address my remarks to sub-clause (3.) of clause 13 to which the Opposition is opposed. When all is said and done, all that we ask is that members of the Government, when handling government business and public money, should adopt the same sort of attitude that they would adopt in handling their own affairs. I suggest that the Government is not giving this enterprise a ghost of a chance to meet its commitments. Insurance is a game in which very skilled and very careful people have indulged for many years. If this enterprise can only embark on the sort of insurance business which people ordinarily employed in insurance will not touch, then there can be no profit in it, because a good deal of the insurance business has been built around estimates of risk and the making of a profit out of them. In this case, a fairly large organization, with an initial capital of £500,000 in public money, has a right, in the end, to undertake expenditure - or to put us in - to the extent of £25,000,000, but is going to operate in a field in which it is estimated that it cannot make a profit. It seems to me, in *view* of th*provisions of this clause, that the Government proposes to use the savings of the workers of the electorates of Wills, Yarra and Wilmot to finance the investments of the electors of Kooyong, Evans and Murray. That is the sort of thing to which I object. I do not object to the general principle of the bill, which is to expand export trade, but I strongly object to clause 13 (3.). I am prepared to admit, with the Minister, that those 21 words do change the nature of the bill. If they were removed, the nature of the operation of this corporation would be changed. The Government proposes to use public moneys and public enterprise to protect the profits and the welfare of the people whom it represents. After all, insurance is a big business. According to a year book which gives figures up to 1951 £77,000,000 was spent on various forms of insurance - not life insurance, but insurance in the fields of fire, workers' compensation, vehicle and marine. A total of £77,000,000 was paid in premiums and the pay-out was only £40,000,000. In other words, the insurance companies have a working capital over and above ordinary expenditure of £30,000,000 available to them. I suppose that that capital will be invested in costly gambles financed by the proposed insurance corporation. There is no constitutional difficulty in the matter because section 51 (xiv) of the Constitution refers to insurance other than State insurance and also State insurance extending beyond the limits of the State concerned. It is time the Government entered the field of insurance in a businesslike way. This is exactly the same sort of provision that brought into being the Commonwealth Bank which entered into such hearty competition with the private banking system for the well-being of Australia. The embarkation of the Government into wider fields of insurance could only benefit every person who insures, and that is every one of us. People who have built homes under the War Service Homes scheme have benefited from the insurance scheme made available by the War Service Homes Division. They have received very big rebates, which have been much greater than any that they could have got from private insurance companies. This is a field which the Government could enter with a great deal of profit. It would stabilize the ability of this corporation to meet its commitments, and even at this time, £25,000,000 is very big money. It represents the cost of hundreds of schools. Even £500,000 is a fair sized initial capital. On behalf of the electors of Wills, the ordinary people who are expected to underwrite this proposal, I demand of the Government that, when setting up a business venture, it adopt the same sort of principles as it adopts when working in its own interest. So the Opposition opposes the insertion of this sub-clause in the bill, and moves for its omission. {: #debate-28-s21 .speaker-JUQ} ##### Mr CLARK:
Darling .- I regret that the Minister for Trade **(Mr. McEwen)** is not in the chamber while this measure is being discussed because it is in the committee stage of a bill that honorable members endeavour to find out the real purpose of the legislation and of the clauses. The Minister for *Customs* and Excise **(Mr. Osborne),** who is at the table, is not informed on these matters and is not able to speak on behalf of the Minister for Trade, who is responsible for carrying out the administration, of the bill. He is the one who should be here to deal with it. Clause 13 is the most important clause in the bill in that it deals with the class of business that the corporation may cover by insurance. I regret very much that the Government wishes to retain sub-clause (3.), which the Opposition proposes to exclude. If certain classes of insurance are to be conducted by the corporation, then, particularly in regard to that business, the corporation should he prepared to cover the whole of the insurance required. I think it is wrong that the exporter should have to go to this corporation to get one section of his insurance cover and then run round to an insurance company to try *to* get other risks covered. The position should be simplified by providing that the corporation may cover marine risks, fire risks and other losses that might be involved in the export of commodities. I ask the Minister for Customs and Excise to inform the committee whether contracts of this character, for instance, will be covered. I am informed by a man who has a contract for the sale of carbonized wool to a foreign power that, to export that carbonized wool, he first has to purchase the wool and pay to get it carbonized, and until such time as he is able to make the delivery and get the documents he is unable to get any finance from the Commonwealth Bank or any other bank. This man is not able to get any finance against the contract that he holds for the wool. He has been told by the Commonwealth Bank and other banks that the wool is not acceptable as security. The banks are not prepared to lend against wool, but only against the actual document of delivery. That is the stage at which they are prepared to advance finance in respect of the wool. I think that if the Government is endeavouring to facilitate exports from Australia, finance should be made available to this man at an earlier stage in order to enable him to purchase the wool, carbonize it, and export it without any risk of loss. For instance, he points out to me that between the time he buys the wool and the time it is carbonized, there might be a shipping hold-up of a week or a month, and in the meantime the price of wool might fall. If the fall were of 5 per cent, or 10 per cent., possibly the purchasing nation would refuse to take delivery of it, and he would be left with the wool on his hands. I want to know-- The TEMPORARY CHAIRMAN.Order! The honorable member m1181 relate his remarks to the clause. {: .speaker-JUQ} ##### Mr CLARK: -- The clause deals with the classes or nature of the risks to be covered, and I am giving a specific instance. I wish to know whether that class of contract or business negotiation is covered by this clause. That is the question I wish to ask the Minister, and L think I am right on the target in making a request of that nature. I have no motive other than to find out exactly what sort of risk is covered, and whether a matter of the nature I have outlined comes within the category of such risks. Another exporter told me he had an order for a very substantial quantity of flour for export to India. He said he was unable to get finance for that transaction, just as the wool merchant I mentioned was unable to get finance, and I want to know whether he will be able to obtain coverage from the corporation for the export of that flour. There is no risk that payment for the goods will not be made on delivery. The actual problem faced by that man arises between the time he buys the flour and exports it, and the time he actually receives payment from the purchaser overseas. Those are instances which have been brought to my notice, and not being certain whether: they are covered by the clause, I wish the Minister to inform the committee whether deals along those lines are covered. I believe that any risk in which an exporter is involved between the time of purchase of the goods he exports and the time of payment for them should be covered by the corporation. T wish to know from the Minister if all such risks are covered - that is to say, whether the exporter is covered in the whole of that period in such transactions as I have outlined. I could give many other examples but I do not wish to weary the committee. I think I have sufficiently made my point by giving these two specific instances. {: #debate-28-s22 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP -- I shall endeavour to answer the questions raised by the Opposition in this debate. The honorable member for Darling **(Mr. Clark)** asks whether carbonized wool would be covered under this scheme between the date of purchase of the wool by the processer, and the date of shipment, while it is still in Australia. I do not think that that is a class of contract intended to be covered by the measure. The export of primary produce, if I understand the bill correctly, is to be covered against classes of risks described, from the time of shipment, but not during the period it is held in Australia prior to shipment. In cases where contract insurance is contemplated, the class of contract intended to be covered is that in which a manufacturer accepts an order for goods which have to be manufactured. The risk of termination of his contract due to the causes that have been set out in the bill, and explained during the debate, between the date of undertaking the contract and starting on the manufacture of the goods, and the date of payment, is covered. {: .speaker-JUQ} ##### Mr Clark: -- 'Carbonized wool is a manufacture, too. {: .speaker-KMD} ##### Mr OSBORNE: -- Well, if it involved considerable manufacturing process, it might be covered, but that is one of the matters which will have to be determined by the commissioner at the time. I turn now to the point raised by the honorable member for Melbourne Ports **(Mr. Crean).** He asked whether clause 13 (2.) excludes or includes coverage of the risk of exchange variations. I cannot understand the importance he attaches to the question. He suggests that some court of law might construe such a risk as being included in this section, and thereby impose a liability on the Commonwealth through the corporation, which was not contemplated. But this clause does not constitute a policy of insurance. This bill gives the right to the commission to underwrite certain risks, and to issue certain policies. I should imagine that in the insurance policy itself there would be defined, following ordinary insurance procedure, the risks that are covered ; and the Minister for Trade **(Mr. McEwen)** said quite plainly in his second-reading speech that the provision does not include the cover of exchange variations, because adequate means exist of obtaining that kind of cover through the Commonwealth Bank. The honorable member for Wills **(Mr. Bryant)** has made a suggestion which seems extraordinary to me. He has suggested that, the Governnent is hampering the activities of the corporation from the outset by not allowing it to undertake ordinary commercial insurance, such as fire and marine risks and so on. I think that quite the reverse is the case. If such an obligation were imposed on the commission that body would incur immense liabilities for premises and staff, skilled advice, actuarial assistance, and all sorts of things. It would be entering into a highly competitive field - the field of commercial insurance. In any event, that is not the Government's intention. This scheme is aimed at insuring, in the interests of the community, a class of risks connected with the export trade which cannot otherwise be covered. The honorable member for Wills mistakenly suggests that this will be an awfully expensive business for the Government. The experience of other countries shows that it will not be so. The United Kingdom export guarantee scheme showed a surplus of £3,000,000 at the end of the financial year 1955-56, and was able to cut, its premium rates by from 10 per cent. to 20 per cent. {: .speaker-KYC} ##### Mr Pollard: -- The circumstances in the United Kingdom are very different from the circumstances in Australia. The United Kingdom has a vast number of exporters compared with the number that Australia has. {: .speaker-KMD} ##### Mr OSBORNE: -- I agree that the United Kingdom scheme is a much larger scheme than ours. Nevertheless, that scheme covers the same sort of risks as are to be covered by this scheme. The risk of ultimate loss is not so great. Suppose an Australian exporter enters into a contract to export goods to a foreign country and then cannot be paid because of import restrictions imposed by the government of that country. The goods are not lost. They are simply unable to be delivered, and payment made for them at the time. {: .speaker-KYC} ##### Mr Pollard: -- What about a case of insolvency of the purchaser? {: .speaker-KMD} ##### Mr OSBORNE: -- The goods are not lost even if the buyer becomes insolvent. I t simply means that the time of realizing on the goods is very much extended. I t is to cover the risk to the exporter that is involved in such an eventuality that this scheme is designed. I was saying that the United Kingdom scheme has been profitable. The Canadian Export Credits Insurance Corporation similarly, in the period from 1945 to 1955 - ten years - had an excess of premiums over claims and expenses, of 118,000 dollars, which is as near to breaking even as is possible in a business of that sort. The honorable member for Lalor **(Mr. Pollard)** says that the Canadian scheme covers a wider field. Something was said in this debate about the Canadian scheme covering marine insurance risks. I have made inquiries and I am able to inform the committee that that is not so. The Canadian scheme does not cover marine insurance risks. I return to the remarks of the honorable member for Wills. He is completely mistaken in suggesting that in not entering the field of general insurance the Commonwealth is likely to be involved in losses. I think the reverse is the case, and I repeat that the Government will not accept this amendment, because it would unnecessarily alter the whole scheme. Question put - >That the sub-clause proposed tobe omitted **(Mr. Pollard'samendment)** stand part of the clause. The committee divided. (The Temporary Chairman - Mr. G. J. Bowden.) AYES: 45 NOES: 31 Majority . . 14 AYES NOES Question so resolved in the affirmative. Amendment negatived. Clause agreed to. Clauses 14 to 25 - *by leave* - considered together and agreed to. Clause 26 - (2.) Moneys of the Corporation not immediately required for the purposes of the Corporation may be invested on fixed deposit with the Commonwealth Bank of Australia or with any other bank approved by the Treasurer, or in securities of the Commnowealth. {: #debate-28-s23 .speaker-KYC} ##### Mr POLLARD:
Lalor -- Clause 26 relates to the application of moneys held by the corporation. The Opposition feels that as the Government has launched this scheme and is guaranteeing it financially, it should at the very least, even though it is a conservative government, ensure that moneys that are available from time to time for investment or to be banked shall be lodged with the people's bank - the Commonwealth Bank of Australia. Accordingly, I move - >That, in sub-clause (2), the words "or with any other bank approved by the Treasurer " be omitted. The sub-clause would then provide that all surplus investible moneys of the corporation not immediately required should be lodged with the Commonwealth Bank of Australia. Even though the bill has been introduced by a conservative government, surely that is a reasonable provision to include in the measure. Another clause provides that, in certain circumstances, the moneys of the corporation may be placed with a private trading bank. The Opposition does not propose to interfere with that provision, because it is possible that premiums may be payable at some outlandish place where there is not a branch of the Commonwealth Bank. Under those circumstances, it would be wise to allow the corporation to have that small amount of money lodged with a private trading bank, pending its transfer to the Commonwealth Bank. In all other cases, as I have indicated, we believe that surplus moneys should be placed with the Commonwealth Bank. {: #debate-28-s24 .speaker-BV8} ##### Mr CALWELL:
Melbourne .- The honorable member for Lalor **(Mr. Pollard)** has made a reasonable statement, and I think that the Minister for Customs and Excise **(Mr. Osborne),** who, it seems, does not intend to speak to the amendment, should extend to the committee the courtesy of saying whether the Government will accept the amendment, or whether it will consider it in another place. For many years past, it has been the policy of all anti-Labour governments including the Bruce-Page Government, and the Lyons Government, to bank with the Commonwealth Bank. I think the Minister should indicate why this Government is departing from a principle to which all governments have subscribed for over 30 years. {: #debate-28-s25 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP -- As was the case with the previous amendment, I am reinforced by the views of the Minister for Trade **(Mr. McEwen).** The Government does not accept the amendment. I point out that the Commonwealth Bank of Australia does not, at the present time, even include the Commonwealth Trading Bank. It has been the practice of organizations such as this proposed corporation to invest their funds with the Commonwealth Bank of Australia, and it is reasonable to assume that that practice will be adopted in this instance, but the Government does not wish the corporation to be restricted to that extent. As I have stated, the Government does not accept the amendment. Question put - >That the words proposed to be omitted **(Mr.** Pollard's amendment) stand part of the clause. The committee divided. (The Temporary Chairman - Mr. G. J. Bowden.) AYES: 44 NOES: 33 Majority . . 11 AYES NOES Question so resolved in the affirmative. Amendment negatived. Clause agreed to. Clauses 27 to 34 - *by leave* - considered together and agreed to. Clause 35 - (1.) The Minister may, either generally or in relation to a particular matter or classof matters, by writing under his hand, delegate to a person all or any of his powers under this Act, except {: #debate-28-s26 .speaker-KYC} ##### Mr POLLARD:
Lalor .- The Opposition proposes to move an amendment in relation to this clause, which provides for the delegation of the powers of the Minister. The clause, asit appears in the bill, gives to the Minister the right to delegate all of his powers, either generally or in relation to a particular matter, to any person, to the office boy or anybody else. The Opposition considers that that power is rather wide, and for that reason I move - >That, in sub-clause (1), the words "to a person " be omitted with a view to inserting the following words in place thereof: - "to the Permanent Head of the Department of State administered by the Minister or an officer of that Department occupying an office in the Second Division of the Public Service of the Commonwealth ". The amendment is designed to restrict the Minister's powers so that he may delegate only to officers of a high classification or to the head of the department. We think it. is reasonable to ask the Government to agree to that amendment. {: #debate-28-s27 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP -- I am delighted to be able to inform the honorable member for Lalor **(Mr. Pollard)** that the Government accepts his amendment. Amendment agreed to. Clause, as amended, agreed to. Clauses 36 to 38 agreed to. Schedule agreed to. Proposed new-clause 13a. {: #debate-28-s28 .speaker-KYC} ##### Mr POLLARD:
Lalor .- On behalf of the OppositionI move - >That, after clause 13. the following new clause be inserted in thebill: - "13a. - (1.)' The Governor-General may, if he deems it advisable for the purpose of assisting the Corporation to develop and facilitate trade between Australia and any other country and for the purpose of carrying out the objects of this Act, authorize the Treasurer to - > >guarantee the undertaking of the Government or an agency of the Government of that other country to pay, or its guarantee of the payment of, the cost of Australianproduced goods purchased from an exporter or the cost of Australian services ; > >make a loan to the Government or an agency of the Government of that other country to enable that Government or its agency or any person ordinarily resident in that other country to pay the cost of Australian-produced goods purchased from an exporter or the cost of Australian services; or > >purchase, acquire or guarantee any security issued or guaranteed by the Government or by an agency of the Government of that other country for the payment of the cost of Australianproduced goods purchased from an exporter or of the cost of Australian services, if the Government of that other country requests the Government of Australia to give such guarantee or loan, or to purchase, acquire or guarantee such securities and. in the case of a guarantee, undertakes to indemnify the Government of Australia against loss in connexion therewith. " (2.) The Governor-General may determine the terms and conditions upon which any guarantee, loan, purchase, acquisition or guarantee of securities shall be made under this section.". The purpose of the proposed amendment is to broaden the whole ambit of the bill and to include a provision whereby credit facilities in addition to those provided in the insurance clauses of the bill may be made available to persons who require to sell goods on long-term credits to overseas countries. It is generally recognized to-day that one of the obstacles to the further expansion of Australia's export trade is the fact that a large number of governments and individuals in other parts of the world are unable to get the required long-term credits from exporters guaranteed by the Australian Government. If they could do so, they would be in a much more favorable position to purchase our products. Those are the governments and the individuals with which export trade should be developed. In those circumstances, we consider that this bill would be much more useful if it made provision for longterm credits than it would be if it were confined solely to the extending of insurance cover. The amendment would enable primary producer boards, which export our important products to other parts of the world, and which already have the greatest difficulty in disposing of their surpluses, to extend long-term credits to other governments or individuals, and thereby facilitate the expansion of our trade. **Her** Majesty's Opposition exhibits no irresponsibility in proposing this amendment. Indeed, if we could he accused of anything, perhaps we could be accused of conservatism. The proposed clause is lifted practically in toto from the Canadian act. I have yet to learn that the Canadian Government that introduced the legislation was a government of the socialist tendencies that it is alleged the Opposition in this Parliament has and continually endeavours to foist upon the Australian people. Furthermore, I would point out that the amendment contains a number of safeguards. First, it provides that the Treasurer shall do certain things. The Treasurer is a highly responsible Minister. Secondly, it provides that the Governor-General - that means the Cabinet - may determine the terms and conditions upon which any guarantee, loan, purchase, acquisition or guarantee of securities shall be made. Two concrete protections are provided in the authority to be vested in the Treasurer and in the Governor-General, who means the Executive Council. For my part, I leave the matter at that. The Opposition is greatly indebted to the honorable member for Darebin **(Mr. R. W. Holt),** the honorable member for Melbourne Ports **(Mr. Crean),** the honorable member for Scullin **(Mr. Peters)** and the honorable member for Yarra **(Mr. Cairns),** who, as members of an Opposition committee appointed to consider this matter, being anxious to help Australia's export trade, suggested the amendment. {: #debate-28-s29 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP -- The Government does not accept the amendment. {: #debate-28-s30 .speaker-QS4} ##### Mr R W HOLT:
WANNON, VICTORIA · LP .- I support the amendment moved by the honorable member for Lalor **(Mr. Pollard).** When we speak of exports to-day, we naturally think, not only in terms of manufactured goods and, possibly, of services which are envisaged as coming within the scope of the bill and of the amendment, but also of raw materials in the form of our primary products. The world trade situation, at the present time, emphasizes more and more the importance of competition in what is now a hardening market tending to favour buyers. Therefore, any measures designed to encourage the export, not only of manufactured goods, and of services, but also of the products of our primary industries, and especially of the exportable surpluses of our primary products, are commendable and should be supported. The gravity of the situation is emphasized, as T have said previously, by **Mr. Marshall** M. Smith. Deputy Assistant Secretary for International Affairs in the Department of Commerce of the United States of America. In the *Foreign Commerce Weekly,* dated the 9th April, 1956, **Mr. Smith** writes - >To-day, wc have much more at stake than the commercial interest of U.S. individuals in the expansion of our exports. > >Our nation is facing a planned program of economic warfare to which the Communist countries have recently given special emphasis. The important problem for us to consider to-day is how are we going to meet this challenge. This challenge comes not only from the Communist countries but also from many others, and the amendment is designed to meet just such a challenge. It envisages two kinds of assistance in addition to (.hat at present provided for in the bill. The amendment deals with a kind of contract that is normally associated with insurance, namely, a guarantee. The guarantee can operate in one of two ways. One can guarantee the local producer, or exporter, so that he may call on a financial institution with the backing of a government guarantee to pay as he goes and to carry him over pending the receipt of final payment for his goods: or, at the request of a foreign government, a guarantee can be given to it, or to an importer. The records show that most of these contracts are made at the request of a foreign government, and, therefore, governments of other countries may well be interested in obtaining a guarantee, or, alternatively, a loan that will enable them to purchase Australia's exportable goods in the form of services, manufactured articles and primary products. There is no such scheme in the United States at the present time simply because there is no need for it. The functions that it would discharge are performed by the Export-Import Bank of Washington. The twentieth report made to the United States Congress by the bank, which covers the period from January to June, 1955, sets out the various functions discharged by the bank - functions that are envisaged and outlined in the amendment. The report emphasizes, at page 3, that - >It is a statutory policy of the .'Bank that its loans shall supplement and encourage but not compete with private capital. The loans and guarantees it lias authorized represent credit transactions that would not have been undertaken by private lending institutions. *Conversation being audible.,* {: .speaker-QS4} ##### Mr R W HOLT:
WANNON, VICTORIA · LP -- I am sorry if I am interrupting honorable members at the end of the chamber to my left. The position is that exports are insured. The bank guarantees the exporter, and. guarantees the purchasing government, or alternatively, makes it a loan, to eucourage it to purchase those exports. Under the policy of the Export-Import Bank, where credit terms of a year or *move ure* involved the bank currently provides, in appropriate cases, first, direct financing of exports; secondly, guarantees against non-payment due to all types . of risk in connexion with finance obtained by exporters from private sources; and, thirdly, guarantees against non-payment due to selected risks. The kinds of exports involved are set out. I shall not waste time by reading the detail. They are generally in the form of capital goods. The policy of the bank is to export capital goods or services of a reproductive kind so that the export market shall continue to receive support. It will be of interest to members of the Australian Country party to know that the bank finances the purchase by foreign importers of raw cotton and similar materials. There is no doubt that, if the United States were to finance, on a wholesale scale, the purchase by foreign buyers of its food surpluses, we should have continued complaints on that score. The United Kingdom Government thought this matter was sufficiently important to amend its Export Guarantees Act in 1949. Sections 1 and 2 of that act provide, amongst other things, that for the purposes of encouraging trade with places outside the United Kingdom, the Board of Trade, after consultation with the Advisory Council, may, with the consent of the Treasury, give guarantees. The whole basis of the section is to assist persons carrying on business in the United Kingdom in such ways as appears to the Board of Trade to be expedient in the national interest. The situation has arisen to-day in a competitive buyers' market where assistance has to be given in the national interest to redress our adverse balance of payments. The amendment, therefore, has the effect of enabling - to a lesser extent certainly and not to the great degree that has been achieved in America, but we hope some day it will be done - these types of exports to he encouraged, new markets to be opened and new markets to be pioneered. Private enterprise will not do those things because the risks are too great. This is an instance where private enterprise can not do it. The surplus of primary products is indicative of it, as is also the fact that we have no export trade in the products of our secondary industries. The insurance to which this bill in its very limited form will apply will not increase our trade to any extent because it is in relatively safe channels now. The overall policy is to encourage the export of reproductive goods which, in turn, will come back in the form of added demands for our exportable goods and services, such as the construction of canals and railway bridges in Iraq and elsewhere. They are some of the things that the American Export-Import Bank has been able to finance. For that reason, if the Government sincerely desires to encourage the export trade, it will accept this amendment. **Mr. MORGAN** (Reid) [10.22 J.- The amendment proposed by the Opposition would be a very practical way of stimulating trade for secondary industries and creating new markets overseas. Many secondary industries, particularly those engaged in the manufacture of agricultural implements, are suffering in that regard because of the lack of credit facilities for potential customers. Secondary industries are also suffering in other respects. One big industry in my electorate, the Clyde Engineering Company, lost a large order from overseas for diesel locomotives because it could not be properly financed. It lost that order to Great Britain. This company has been turning out a considerable number of diesel locomotives under the Colombo plan, and was hoping to be able to develop the trade in other ways. Many Asian countries are not able to extend their trade with Australia and other countries because of lack of credit facilities. An example of that is given in the Third Annual Report of the Consultative Committee of the Colombo plan for Co-operative Economic Development in South and South-East Asia. It was hoped that the Colombo plan would result in the extension of trade with those countries that are now receiving gifts under that plan. Chapter 3 of the report I have mentioned contains the following statement: - >One of the greatest impediments to the development of agriculture and the raising of the peasant producer's living standards is the widespread dependence of the farmer on moneylenders and middlemen. Loans to farmers carry an interest rate of the order of 100 per cent, or more. Because of the burden of debt, the farmer is deprived of the freedom to choose his own selling time, and the price at which he is forced to sell allows a large margin of profit to middlemen. Agricultural credit institutions, regulated by a central " Office de Credit Populaire " (Credit Union Office), have existed in Cambodia since 1029, but mainly through lack of finance, have been unable to solve the problem. The Royal Cambodian Government now has under consideration measures to promote farm credit by the encouragement of finance by co-operative methods, supplemented by State advances using domestic capital resources and foreign aid. {: #debate-28-s31 .speaker-10000} ##### The TEMPORARY CHAIRMAN: -- Order I The honorable member should come back to the amendment. {: #debate-28-s32 .speaker-JVA} ##### Mr MORGAN: -- The amendment proposed by the Opposition could link up with proposals of that nature by the governments of these countries to assist co-operative concerns, to supplement any finance that could be found by the Government itself, and to provide for long-term repayments by potential customers. That could apply not only in regard to manufactured products of our secondary industries, but also in regard to primary products. We are suffering from over-production simply because we cannot find markets, or the purchasing power is not possessed by potential customers. That applies not only to Australia, but to other primary producing countries. It applies to the United States of America itself. That is made very clear by the policy recently laid down by the United States Government, which is set out in a bulletin issued from Washington by the United States Information Agency and dated the 9th January. It stated - >President Eisenhower to-day submitted to Congress a nine-point agriculture program intended to reduce huge government-owned crop surpluses and to enable American farmers to more adequately share in the " Nation's greatest prosperity ". . . . > >The first and key item in the message is a 1,000,000,000 dollar " soil bank " plan which farmers would be paid to take an estimated 25,000,000 acres out of production during the next three years. Under the plan, the President offered two methods for reducing agricultural output. > >An " acreage reserve " program aimed at achieving a ' voluntary reduction " of as much as 20 per cent, in the acreage devoted to such major surplus crops as wheat and cotton . . . > > **Mr. Eisenhower** proposed that the Congress authorize 350,000,000 dollars fur this program in 1050 "and a total of about 1,700,000,000 dollars over the next three years ". He said this plan will: " Help remove the crushing burden of surpluses." " Reduce the massive and unproductive storage costs on Government holdings." " Ease apprehension among our friends abroad over our surplus disposal program." We are in the same position. W e can produce these primary products but we cannot get rid of them simply because the customers lack the purchasing power. It is an extremely negative process when we take acreage out of production and plough those products back into the ground. That is the sort of negative policy that applied during the great depression. The amendment proposed by the Opposition is a very practical approach to and a very practical solution of this problem. By helping to create the necessary credits, the amendment will stimulate trade and will not only help to give employment to our own people but also create prosperity and make friends and customers in those countries to which I have referred. {: #debate-28-s33 .speaker-1V4} ##### Mr CAIRNS:
Yarra .- This amendment is the most substantial one proposed by the Opposition to this bill. It may very well be that the answer of the Government will be that this bill concerns insurance, and that it is no part of the intention of the Government to include in it a provision dealing with the financing of sales on credit. That, in itself, may be a satisfactory answer, but the Minister for Customs and Excise **(Mr. Osborne),** in an interjection during the speech I made in the second-reading debate, admitted this was a first step and implied perhaps that a second step was justified. When introducing this measure to the House, the Minister for Trade **(Mr. McEwen)** pointed out that the two main matters with which a bill of this sort might be concerned were the risks of nonpayment in export transactions - the sort of risks that we have dealt with at length earlier in the committee stage of this bill. He went on to -mention the difficulties of financing sales on credit terms. The Minister recognizes that in this field there are two substantially different types of transactions. That appears from his introductory remarks. But there is no provision in the bill for financing credit sales, and no indication from the Government that any provision can be expected. In view of the recognition both by the Minister for Customs and Excise and the Minister for Trade of the importance of financially assisting sales on credit terms, I ask the Minister seriously whether he can give any indication if and when the Government proposes to take this very necessary second step. In Canada and the United Kingdom, to which a good deal of attention has been directed in this debate, we have two countries that are most experienced in a number of ways in this field. When, in 1945, the then Chancellor of the Exchequer in the British Labour Government, **Mr. Hugh** Dalton, introduced a measure that has been quoted at some length with regard to this provision for assisting the financing of credit transactions, he pointed out that experience in England in the narrower fields of insurance had shown clearly that there was a much more important field that was being neglected, and that it was of vital importance to the British Government, facing the difficulties that it faced in 1945, that this matter be proceeded with without delay. How long must we undergo the experience that Great Britain underwent ? I suggest that the experience of that country extended over an unduly long period, from 1900 to 1945, under the influence of governments which, I think, saw things in much the same way as this Government does. Finally, the British Government, under the stress of very great emergency and need, took this very important second step. I again ask : When does this Government expect that it might take this important second step? The importance of this step must be recognized when we realize that in Canada one-tenth of the total trade is carried on with the assistance that is granted under the provisions of legislation of the kind that we are proposing in this amendment. In the United Kingdom one-seventh of the total trade is carried on in this way. I suggest that in Australia this measure is of even greater relative importance than similar measures are to the other two countries I have mentioned. It is of greater importance to Australia for several quite distinct reasons. First, Australia is facing more significant falls in export prices. Reports appeared in, I think, to-day's newspapers of falls in the prices of our most significant export commodities, ranging from 16 per cent, to 8 per cent., although one or two of our less-important exports, such as hides, experienced rises in price. Another reason why this matter is so much more important to Australia is that in our ordinary banking business we have not seen the development of banking practice in this field of the kind for which Great Britain has been famous for a couple of centuries. In the ExportImport Bank in New York the banking practice in this field has been very highly developed, and the banking system in Canada is experienced in this direction. In Australia, however, the commercial banking system is inexperienced in this type of transaction. For this reason, then, it is most important for Australia that this measure he adopted without, delay. {: .speaker-KGC} ##### Mr Hamilton: -- The time is ripe? {: .speaker-1V4} ##### Mr CAIRNS: -- It is more than ripe, when we look at the Australian situation, and I may say that members of the Australian Country party who support the Government should be the first to recognize the ripeness of the situation, because one of the most important of our export commodities, wheat, is accumulating in silos all over the country, and I understand that the prevailing slogan is, " Hear no weevil, think no weevil, and see no weevil ". The situation in regard to wheat is one of great difficulty. It seems to me that the Government is hesitating about taking this important step because of the costs that may be involved. This measure has been limited so that transactions to the extent of £25,000,000 may be covered at any one time, but the initial outlay has been limited to £500,000. The Government is obviously concerning itself with costs. The honorable member for Lawson **(Mr. Failes)** drew a distinction between the responsibilities of the Minister under this bill and his responsibilities in connexion with transactions of the Australian Wheat Board, and I remind the honorable member for Lawson that the transactions of the Australian Wheat Board are costing this country £40,000,000 or £50,000,000, or even more, a year. Large amounts of money are being paid to wheat producers so that they will grow wheat that cannot be sold. {: .speaker-KGC} ##### Mr Hamilton: -- The honorable member is a long way out in his figures. {: .speaker-1V4} ##### Mr CAIRNS: -- The honorable member for Canning **(Mr. Hamilton)** will not interject, I hope, so frequently as to miss my point. I support the practice of assisting the wheat industry. It is a most important industry to Australia, and one that has to be assisted for national purposes. I remind the committee, however, that it is done at considerable cost to the community, and it is far better to try to use some of that money in achieving a payable market, or even a market that is not entirely payable at ruling world prices, than to grow wheat which is allowed to accumulate in the way that it has done. Therefore, for reasons that apply to Australia, but not to the same extent to Canada, this measure is of even greater importance to this country than it is to Canada. There is one other point that again emphasises the importance of this measure to Australia. As has been pointed out by the honorable member for Darebin **(Mr. R. W. Holt),** the present trading situation offers a challenge to Australia which this country will, I hope, take up without any further delay. It is all very well for honorable members to concern themselves with defence, and to talk in terms of defence, and every time they hear the word " Communist " to think in terms of a gun and a bullet. That is one way to approach our problems and our relations with Asia. I had the pleasure last night, after participating in the debates in this chamber, of reading some of the speeches of **Mr. Adlai** Stevenson, who was, as honorable members will remember, a candidate for the presidency of the United States of America. He pointed out very clearly that we have relied for far too long on military measures in our relations with Asian countries, and that it is the responsibility of the United States to enter much more thoroughly into the field of trade with those countries. He said that it would not be possible to do this completely or satisfactorily through ordinary commercial trading channels. He is a man who is by no means a socialist, but if his opinions were widely expressed in this country he would surely be labelled as a man of Communist opinions by the people who make it their special business to judge these matters. These statements demonstrate that this measure is even more important for Australia than for the United States. The TEMPORARY CHAIRMAN.Order ! The honorable member's time has expired. {: #debate-28-s34 .speaker-KDA} ##### Mr DUTHIE:
Wilmot .- I rise to give sincere support to the submissions of the honorable member for Lalor **(Mr. Pollard),** the honorable member for Reid **(Mr. Morgan),** the honorable member for Yarra **(Mr. Cairns)** and the honorable member for Darebin **(Mr. R. W. Holt),** who all preceded me in the debate on this very important amendment. This is the crux of. the bill. All the rest is packing, or scaffolding, or frills. The bill that is before the committee has no teeth in it, and the purpose of this amendment is to provide it with teeth. The Opposition is not opposing the measure, as you know, **Mr. Temporary Chairman.** We feel that it is a step, although a very timid step, in the right direction. Throughout we have contended that it does not go far enough. The amendment is intended to allow the Government to take the further step which will make the bill really effective in encouraging trade. We believe that the Government has acted as if afraid of the dark. The Minister, in the first sentence of his second-reading speech said - >The purpose of the bill is to promote Australian export trade. We contend that the measure will not achieve the high ideals and the great objectives about which the Minister speaks. The amendment would extend the bill so as to provide for export credits. That is in line with what is done in Canada and England, whose systems the Minister has praised. I cannot understand why the Government, in drafting this bill, should have taken from both those systems everything but the teeth. *lt* is obvious that the bill will not achieve the high objectives mentioned by the Minister unless the amendment is accepted. If accepted, it would provide a financial answer to the fears of the exporter facing an uncertain market. One can freely admit that, because of lower standards of living, the markets to the north of Australia- offer risks to the exporter. Export credit would allow him to trade with confidence with China, the Philippines, Indonesia, Burma, Thailand, Ceylon and Malaya - the very fields to which we must go for our new markets. The Government has talked itself hoarse about new markets for Australian dairy products and wheat, which is difficult to sell overseas. Many of our old markets have been captured or invaded by nations that have become our competitors since the war. We must make a determined effort to obtain the custom of the nations to the north of Australia, and an export credits system backed by the financial power of the nation would enable us to do that. It would work out in this way: Under Canada's export credit system, a firm may have an order to supply thousands of tons of paper to China. That country may not be able to complete the payment for two years. The Export Credit Department will finance the transaction, so that the supplier will not have to wait two years for his money. {: .speaker-KGC} ##### Mr Hamilton: -- It pays out the insurance. {: .speaker-KDA} ##### Mr DUTHIE: -- It does nothing of the sort. It pays for the whole transaction. {: .speaker-KGC} ##### Mr Hamilton: -- Under the bill, the corporation would pay out the insurance. {: .speaker-KDA} ##### Mr DUTHIE: -- The Canadian scheme finances the whole transaction. In England the same position applies. An English firm may have an order to supply 100 bulldozers to Indonesia. Indonesia may not be able to pay for eighteen months, but, as the firm cannot wait that long, the Export Credit Department will finance the transaction and later recover the money from Indonesia. That is the real way to promote trade. The adoption of such a system would put teeth into this bill. Recently this Government sent a Trade Commissioner from Hong Kong to Peking to examine the possibility of finding a new market for our products in China, which offers the world's largest market for industrial plant and machinery of all kinds. Under its fiveyear plan it needs tractors, agricultural machinery, earth-moving equipment, electrical apparatus, medical equipment and drugs, chemicals, fertilizers and a wide range of steel products. We are not yet exporting one of those items to China. The Government may say that China is a doubtful financial proposition, but export credits would give exporters sufficient confidence to send their goods to that country. Already Britain, Holland, Belgium, France, Italy, Japan, Turkey, Switzerland and Finland are trading with China. The apathetic attitude of this Government towards that country is shown by the fact that in recent years we have sold more Australian goods to the 500,000 inhabitants of British North Borneo than to China's 600,000,000 inhabitants. In fact, we are selling less to modern China than we sold to the impoverished, war-torn China of 1938-39. We might also use an export credit system to boost our trade with the Union of Soviet Socialist Republics. Australia is the only primary exporting nation that is not taking advantage of the expanding Soviet market. All our competitors are doing so. New Zealand is supplying butter, wheat and meat in large quantities; South Africa is supplying wool and meat; the Argentine is supplying wool, skins and meat; Uruguay, meat and wool; Denmark, butter; Holland, butter and cheese; and Canada, pork. This country is sending virtually nothing to the Union of Soviet Socialist Republics. That is a completely hypocritical attitude. Fortunately I can use that word in this Parliament. The Government speaks about expanding our overseas trade and finding new markets, but it has hardly touched these two great potential fields. Every country of any worth has beaten us to it. The amendment, if accepted, would give exporters encouragement to send agricultural equipment and primary products to China, Japan, the Philippines, Burma, Malaya, Ceylon and Indonesia. That would really strike a blow for our languishing export trade. {: #debate-28-s35 .speaker-JLT} ##### Mr IAN ALLAN:
Gwydir .- The absolute insincerity of the Opposition in moving this amendment is proved by the record of Labour- {: .speaker-KYC} ##### Mr Pollard: -- I rise to order. I take exception to the remark of the honorable member for Gwydir that the Opposition has been absolutely insincere in moving this amendment. We have moved it in all sincerity, as a constructive approach- The TEMPORARY CHAIRMAN.Order! The honorable member for Gwydir has not used an unparliamentary expression. {: .speaker-JLT} ##### Mr IAN ALLAN: -- The insincerity of honorable members opposite in moving this amendment is shown by their record- ~ {: .speaker-KDA} ##### Mr Duthie: -- I rise to order. I, too, take exception to the remarks of the honorable member for Gwydir and ask him to play the game, as we have tried to do in this debate. {: .speaker-KGC} ##### Mr Hamilton: -- On the point of order- The TEMPORARY CHAIRMAN.Order ! No point of order is involved. I have already ruled that the honorable member for Gwydir has not used an unparliamentary expression, and have authorized him to continue. {: .speaker-JLT} ##### Mr IAN ALLAN: -- The greatest handicap to our export industry is our high rate of costs in Australia, which is due to our low level of productivity. The Australian Labour party has had ample opportunity to show by its deeds and through its organization in this country that it is determined to reduce costs and help our export trade in a practical way. It is all very well to move a high-sounding amendment in this chamber- The TEMPORARY CHAIRMAN.Order ! The honorable member may only speak to the amendment. He cannot wander outside it. {: .speaker-JLT} ##### Mr IAN ALLAN: -- I am referring to the amendment - proposed new clause 13a. Sub-clause (1.) reads, in part, as follows : - >The Governor-General may, if he deems it advisable for the purpose of assisting the Corporation to develop and facilitate trade between Australia and any other country and for the purpose of carrying out the objects of this Act, authorize the Treasurer - At present we have the position where one great organ of the Australian Labour party is trying to disrupt our principal export industry, the wool industry. 1 conclude briefly on that note. The TEMPORARY CHAIRMAN.Order! The honorable gentleman is out of order. The subject before the committee is the guaranteeing of loans, not the general question. {: .speaker-JLT} ##### Mr IAN ALLAN: -- The proposed amendment is hypocritical and frivolous, and will not deceive the producers of thi? country for a moment. {: #debate-28-s36 .speaker-KWP} ##### Mr TURNBULL:
Mallee **.- Mr. Temporary Chairman,** in view of the remarks of the honorable member for Wilmot **(Mr. Duthie)** on this amendment, one would think that he would give credit to other countries to make it possible for them to buy .our goods so that we could enter into a great season of prosperity resulting from the purchase of all our surpluses of wheat and other products. Then everything would be rosy in Australia. I have examined the amendment very carefully, and it appears to me- {: .speaker-KYC} ##### Mr Pollard: -- I rise to order. The honorable member for Mallee assaulted the honorable member for Hunter **(Mr. James).** {: .speaker-10000} ##### The TEMPORARY CHAIRMAN: -- I think that he was getting a little frivolous. He was urging the honorable member for Hunter to ask his colleagues to be silent. If I do not get some order in the chamber, I shall do a bit of talking myself. The honorable member for Mallee may continue. {: .speaker-KWP} ##### Mr TURNBULL: -- When the din has subsided, I shall do so. It appears to me that, under the Opposition's proposal, the people of Australia will give certain countries credit to enable them to purchase our goods. That seems to have pleased the honorable member for Wilmot exceedingly. I point out that if it is necessary to guarantee credit to certain; countries, they cannot be in a position to pay at the time of purchase. {: .speaker-KX7} ##### Mr Ward: -- How does the honorable member know that? {: .speaker-KWP} ##### Mr TURNBULL: -- That is why the credit is necessary. They are not able to' pay cash for the goods at the time of purchase. So this money is made available. What happens is that they purchase the goods with the credit given and, if their financial position does not improve, the countries have our goods which have been paid for with our money. That may be a wonderful scheme for an opposition, but it is certainly not logical for a government to adopt. Furthermore, the honorable member for Wilmot talked so much about putting teeth into this measure that I thought he was in the dentistry business. The bill, as introduced by the Government, will be of great advantage to exporters. The Labour party, when it has been in government, has never thought of anything like this. The special aid that the Government has given to the aged provided an illustration of the Opposition's attitude to this type of measure. Immediately the Government introduced that bill and arranged to provide the money necessary for its implementation, the Opposition wanted the allocation to be doubled. The Australian Labour party always jumps on the band wagon. The Government having brought forward a bill which is much better than anything that Labour has thought of, Labour immediately wants to introduce a provision that is not envisaged by the Government. If Labour wants to do that, why does it not introduce a bill embodying its ideas? Why does it want to amend this one? There are certain export industries that the Government intends to assist through this bill. When the corporation is set up to handle the insurance business, it will deal with each claim for assistance on its merits. {: .speaker-KYC} ##### Mr Pollard: -- Tell it to the Australian Dried Fruits Association. {: .speaker-KWP} ##### Mr TURNBULL: -- The association might have a case that will justify assistance. The honorable member for Lalor **(Mr. Pollard)** should not try to gain political kudos out of an interjection. {: .speaker-KYC} ##### Mr Pollard: **Mr. Pollard** *interjecting,* The TEMPORARY CHAIRMAN.Order ! The honorable member for Lalor has done his share of talking for to-night. I ask him to remain silent. {: .speaker-KWP} ##### Mr TURNBULL: -- When the bill passes through all stages and becomes an act and the necessary arrangements are made to put the legislation into operation, the Government will give consideration to those export goods that it considers have merit. There is no need for the honorable member for Lalor to speak about the dried fruits industry because I would advocate, perhaps, that it should be one industry to get assistance. {: .speaker-KX7} ##### Mr Ward: -- What about the loan? {: .speaker-KWP} ##### Mr TURNBULL: -- The loan is quite apart from this bill, and is something that Labour is trying to introduce only to confuse the issue. **Mr. CLYDE** CAMERON (Hindmarsh) 1 10.58]. - I feel that one of the most apt comments that have been made in this chamber during the debate was the interjection by the honorable member for Mitchell **(Mr. .Wheeler)** who, looking towards the honorable member for Mallee **(Mr. Turnbull)** said, " You are putting on an act now ". I agree with the honorable member for Mitchell. The Australian Country party at last finds itself forced into a corner in relation to the proposed amendment. The members of that party have been forced for the first time clearly and distinctly to declare whether they are in favour of allowing the primary producers whom they claim to represent to be given the opportunity to sell their surplus goods to countries that cannot afford to pay cash for them. The proposed amendment would enable the Government to finance such transactions so that the surplus goods could be bought by those people who are starving because they cannot get enough to eat. The honorable member for Mallee said that if those people ultimately fail to pay for the goods in respect of which the Government would be compelled, under the Opposition's proposal, to give longterm credit, there would be a terrible calamity, because those starving people would have our goods and we would never be paid for them. I would far rather see the starving millions of Asia have our surplus wheat, even if they did not pay for it, than have the wheat eaten by weevils in the silos of Victoria and New South Wales. Even if those countries did not pay for the wheat at the end of the long-term credit plan that is envisaged by the Opposition's proposal, it would at least establish the kind of friendly relations that are likely to be enduring between this country and them. The Australian Country party claims to be terribly concerned with the welfare of the farmers, the dried fruit-growers, and, as I remind the honorable member for Angas **(Mr. Downer)** who has sat smilingly through the whole debate, the wine-makers ; and yet, its members fail to grasp this opportunity, which is given to them on a platter by the Opposition. to solve the very problem which, for the last four or five years at least, the primary producers of this country have been trying to have solved for them. Now, I want to make an announcement to the committee on behalf of the Wheat Growers Federation of Australia. This is an important announcement. The general secretary of the Wheat Growers Federation of Australia, **Mr. Tom** Stott, has told me that he is wholeheartedly in favour of the Opposition's amendment, and he will be staggered if toose on the Government benches vote against it. Now, I am warning the members of the Australian Country party that if they vote against the proposal of the Opposition, contained in the amendment we are now discussing, they will do so at their own electoral peril, because the wheat-farmers are waking up to the Australian Country party so far as that party's pretensions to represent them are concerned. The wheat-farmers, the dried fruits-growers, and the people engaged in the wine industry, are beginning to see the Government parties in their true light. {: #debate-28-s37 .speaker-KCK} ##### Mr DOWNER: -- Does the honorable member think that they regard him as their friend? {: #debate-28-s38 .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Of course they do, because the people I am referring to know that I helped, in my early days, to produce dairy products, and that I was on a farm that produced wheat. They know, comparing me with some honorable members opposite who claim to represent primary industries, that I have a lot more in common with the primary producers of Australia than have honorable members on the Government side. The TEMPORARY CHAIRMAN.The honorable member should say something in common with the amendment. {: .speaker-2V4} ##### Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP -- Say something in common with the amendment! Very well, I have everything. in common with the amendment, but I want you, **Mr. Temporary Chairman,** and your friends of the Australian Country party, to have something in common with it. All I want to say, in conclusion, is that here is an opportunity, given to the Government by the Opposition, to enable the primary producers to dispose of their surplus products. And let me say this : Unless Government supporters grasp this opportunity now it might be too late this time next year, because the surplus wheat stocks in the world are growing larger and larger, and the demand for wheat is growing greater and greater. One thing only separates the growers of wheat in Australia from the people who want our wheat, and that is finance. The amendment contains a provision which, if accepted by the Government, would give co Australian primary producers the same opportunity as the primary producers in Great Britain and Canada have to dispose of their surplus wheat. I commend the amendment to the committee. {: #debate-28-s39 .speaker-KMD} ##### Mr OSBORNE:
Minister for Customs and Excise · Evans · LP .- The Government will not accept this amendment. The honorable member for Hindmarsh **(Mr. Clyde Cameron)** has made an announcement which he has described as important, but this rabbit which he has produced from his capacious hat turns out to be a well-known character, **Mr. Stott,** whose views have not only been communicated to the honorable member for Hindmarsh, but have also been circulated widely through Parliament House, and communicated to the Government. They have been considered very carefully by the Government. The Government understands the arguments which lie behind this amendment moved by the honorable member for Lalor **(Mr. Pollard).** They have been most carefully considered, and have been rejected for good reasons. The first reason is that the whole object of this scheme is not to provide for the Government itself to supply long-term credit; it is to insure Australian exporters against certain risks which they cannot at present insure against through ordinary commercial insurance channels. {: #debate-28-s40 .speaker-KX7} ##### Mr WARD: -- What has happened *to* much-vaunted private enterprise? {: .speaker-KMD} ##### Mr OSBORNE: -- If the honorable member for East Sydney **(Mr. Ward)** will listen for a moment, I shall perhaps be able to tell him. {: .speaker-KX7} ##### Mr WARD: -- I am asking a simple question. The TEMPORARY CHAIRMAN.Order! The honorable member must remain silent. {: .speaker-KX7} ##### Mr WARD: -- I will make a speech. {: .speaker-KMD} ##### Mr OSBORNE: -- The exporter, or potential exporter, having obtained an insurance cover against these risks, can then secure credit from his own banker, and that is the purpose of the measure. If the amendment were accepted, and the Government itself had to find long-term credit for purchasers of Australian goods or commodities, our balance of payments position would be much more strained than it is now. The object of the measure is to assist exporters to increase their foreign trade and, incidentally, in doing so, to relieve pressure on our overseas funds. The purpose of the measure is not to create further pressure on those funds which would be the result of the operation of the provision contained in the amendment. The main commodity which would be most likely sold under a provision of the sort contained in the amendment would be wheat. But there is no barrier at present to the sale of wheat overseas, on credit, by the Australian Wheat Board itself. In fact, it has made such a sale quite recently in a transaction with the Government of Poland. I repeat, the board is perfectly entitled to sell on credit, and has recently done so. When this corporation is established there is nothing in the bill as it stands to stop the Australian Wheat Board from approaching the corporation and asking for insurance cover of the risk involved in a sale on credit. The corporation would be quite free to consider on its merits such an application from the board. However, it is correct that the corporation is not to be permitted to have more than £25,000,000 of total liability outstanding at any one time, and, therefore perhaps if the wheat transaction were very large it would have to be considered in relation to the corporation's other liabilities at the time, and the corporation might not be able to accept the risk. But, as I have said, there is nothing to prevent the Australian Wheat Board from selling on credit if it wishes to do so. A good deal has been said in the last half hour or so about the Canadian position. It is true that in Canada bulk sales can be made on credit terms backed by the Export Credit Insurance Corporation; but the position in Canada in relation to wheat is quite different from that in Australia. Although there is a wheat board in Canada that board does not export wheat, which is exported through the ordinary commercial channels by private exporters. In Australia, the Australian Wheat Board, as I have said, can and does export wheat, and there is not therefore the need in Australia for such an agency as exists in Canada. As to the export of capital goods *on* credit, which the Opposition seeks to make possible, there is nothing in the bill as it stands to prevent the corporation insuring against risks which include long-term credit risks. The maximum terms of credit are matters which the corporation will have to consider, and it will have regard to the terms of credit being offered by other countries, when it considers the sort of risks that it will insure. The honorable member forReid **(Mr. Morgan)** seemed to think the case that he mentioned, of the Clyde Engineering Company Limited seeking to export diesel-electric locomotives and being unable to do so, was not covered by the terms of the bill as it stands. The transaction he referred to is clearly the sort of transaction which can be effectively covered by the corporation. The honorable member for Yarra **(Mr. Cairns)** said that the Minister for Trade **(Mr. McEwen)** had indicated - as he did - that there are two sorts of matters which are to be objects of assistance by this corporation. One is the risk of nonpayment, and the other is the difficulty of financing transactions on credit. But it does not follow that the Government itself has to provide the credit. The means of assisting the potential exporter to obtain credit is to insure him against a certain class of risks against which he cannot at present insure through ordinary commercial channels. Having insured himself against those risks he would be able to obtain credit from his own bank. That is perhaps not an exact analogy, or a complete one. An insurance policy against fire in a weatherboard house does not itself create credit; but if a person goes to a bank to raise money on the security of a weatherboard house the first thing the bank asks is whether that person has insured against fire in the house. Similarly, an exporter or potential exporter who asks for credit against the right to be paid for his goods will be asked by the bank whether he is covered against those risks which he cannot insure against through the ordinary commercial channels. Now he will be able to say, " Yes, I am covered by the new corporation ". I think that the real answer to the amendment, and the reason why the Government has rejected it, is that the scheme, as it stands, will cover the present and real needs of the Australian exporter. It will enable him to insure his transactions against the classes of risk against which he cannot now insure, and it will greatly facilitate Australian export trade. {: #debate-28-s41 .speaker-KYC} ##### Mr POLLARD:
Lalor **.- Mr. Temporary Chairman-** Motion (by **Mr. Osborne)** put - >That the question be now put. The committee divided. (The Temporary Chairman - Mr. G. J. Bowden.) AYES: 49 NOES: 35 Majority . . 14 AYES NOES Question so resolved in the affirmative. Question put - That theclause proposed to be inserted **(Mr. Pollard's amendment)** be so inserted. The committee divided. (The Temporary Chairman - Mr. G. j. Bowden.) AYES: 35 NOES: 49 Majority . . . . 14 AYES NOES Question so resolved in the negative. Title agreed to. Bill reported with an amendment; report adopted. Bill - *by leave* - read a third time. {: .page-start } page 2162 {:#debate-29} ### INCOME TAX AND SOCIAL SERVICES CONTRIBUTION (COMPANIES) BILL 1956 {:#subdebate-29-0} #### Second Reading Debate resumed from the 15th May *(vide* page 2046), on motion by **Sir Arthurfadden)** - >That the bill be now read a second time. {: #subdebate-29-0-s0 .speaker-1V4} ##### Mr CAIRNS:
Yarra .- When the debate was adjourned last night, I had pointed out that, in order to check inflation, the highest rates of taxation should be imposed on the companies earning the highest profits. The Opposition opposes this bill because we believe that it will not succeed in controlling inflation. It imposes the wrong sort of tax for that purpose. This measure imposes a flat-rate tax on company profits, whereas the appropriate kind of tax to control inflation in the present situation is, we believe, a tax on excess profits. In the course of -this debate, the Opposition has pointed out clearly, and has supported its statements with facts and statistics, that in the year 1953, 397 private companies earned a profit of more than £50,000 a year each, and in total earned taxable income amounting to £43,296,789, on which they paid total tax amounting to £11,800,000. In the same year, 995 public companies earned taxable, income totalling £230,630,524, on which they paid tax amounting to £71,750,335. The Opposition asserts that the present inflationary situation is due to profit inflation and, in his statement of the 14th March, the Prime Minister **(Mr. Menzies)** went a considerable distance towards accepting that assertion. If our assertion is true, we believe that the type of tax that should be imposed by this measure is a progressive company tax which would tax at the highest rate the companies earning the highest profits, that is, the *1,4:92* companies which, as I have just mentioned, had over 80 per cent, of company income. Probably at the end of this financial year . their net income after the payment of tax will be considerably higher than it was in 1953. In order to control inflation, company tax must be imposed at a progressive rate, mainly upon these companies, because, as the honorable member for Melbourne Ports **(Mr. Crean)** pointed out in this debate, if we are to get at excess profits, we must aim particularly at high rates of profit. It is almost certain that high aggregate profits are also excessive profits. Therefore, if we a.Te check inflationary pressure, and encourage the kind of investment the Prime Minister wants, we must have the kind of tax that gets at excessive profits. In point of fact, the kind of tax proposed in this measure is the very opposite of the kind of tax we need. The progressive tax advocated by the Opposition would be probably easier to administer than the tax that is proposed in this measure, and if it. were properly imposed it would apply to about 1,500 or 1,600 companies. The tax proposed in this measure is not an anti-inflationary tax, because it will be assessed at a fiat rate, not a progressive one. Of course, this is consistent with the Government's approach to taxation, as evidenced in other recent taxation measures. The tax imposed by the bill is contrary to the principle of taxation according to ability to pay. The second reason why this measure is not likely to succeed in checking inflation is that it will increase taxation revenue by only about £30,000,000 a year. The Prime Minister, in his analysis of the present situation. acknowledged that the real investment pressures are coming from the direction of private investment, not public investment. At the same time, he announced that, as a cure for inflation, the Government proposed to increase company taxation at a fiat rate in order to obtain additional taxation revenue of £30,000,000 a year. That amount will probably be only a little more than 4 per cent, of the company profits in Australia in the coming financial year. In fact, the increase of company taxation will result in a reduction by only about 1 per cent, of the average rate of profit returned by the 1,080 companies reported in the *Financial Review* recently as averaging 18£ per cent, profit. It is not at all likely to have any active anti-inflationary effect. This proposal must fail as an anti-inflationary measure. It will not raise sufficient revenue and it will not impose a sufficient burden upon the companies concerned, to make any appreciable difference to their rate of profit. The Opposition opposes the measure for two reasons. First, the increase is imposed in the wrong place to have the desired effect; and secondly, there is not enough of it. For these two reasons this increased tax is likely to fail as an anti-inflationary measure. There are, of course, other reasons why it will not operate against inflation. Those reasons are ancillary or subsidiary to the main reasons, but they are of great significance *from* a social and economic point of view. First, there are extremely large volumes of accumulated profits upon which these companies can draw, and this point does not seem to be sufficiently appreciated by the Government in its analysis of the present situation. The position that has developed is that the large companies - the 1,400 or so that I have cited and probably not any more - draw for their investment upon their own accumulated resources, their own earnings. They do not have to concern themselves with shareholders' contributions. They do not have to be concerned about the level of savings which prevails in the community. These mammoth concerns are able to determine their own economic future within the limits of their own resources, so this kind of tax is of no significance in relation to the enormous accumulations which most of these companies possess. Another matter of importance that was mentioned for the honorable member for Melbourne Ports **(Mr. Crean)** in his contribution to the debate yesterday, is the significance of the " managerial revolution ". I do not know whether members of the Government have read the book of that title by the American author, James Burn ham, but they show no evidence of having read it. We still hear from supporters of the Government the old nineteenth century slogan that the shareholders control the company. The analysis of the situation made by James Burnham in readily readable material - I would say still better proved and demonstrated clearly in a book published, in America in 1935, *The Modern Corporation and Private Property,* by Burle and Means - shows clearly the significance of the managerial revolution and that, as the industrial revolution in the development of factories had the effect of separating the workmen from control of the means of production, so the managerial revolution identified by those writers had the effect of separating the shareholders from the control of the means of production. The shareholders have been expropriated from control in the same way as the workers were by the industrial revolution. As an antiinflationary measure, this bill is not likely to have any significance on those companies. I suggest that the bill illustrates the willingness of the present Government to tax consumers, not in relation to their ability to pay, but at an indirect rate which is contrary to their ability to pay. The Government has very obviously let off profit receivers, not only for their share of contribution to the control of inflation in the present situation but also, as the bill shows clearly, it has let off large and excessive profit receivers more than it has let ofl small profit receivers. As in so many things, when it is faced with the choice, this Government chooses to tax the excessive profit receivers less progressively than lower profit receivers. It also is clearly in favour of big profit receivers at the expense of smaller profit receivers. {: #subdebate-29-0-s1 .speaker-KXZ} ##### Mr PETERS: -- The big profit receivers are the Government's friends. {: .speaker-1V4} ##### Mr CAIRNS: -- Of course they are. The bill will not make any effective contribution to the control of inflation, so it appears that inflation will continue. This has two consequences which must be related to this bill, because the bill could provide an effective contribution to the control of inflation, but it fails to do so. Two distinct consequences of the bill's failure to control inflation become related to it. The first is implied in the argument that has already been developed. There is occurring in the community an effective redistribution of income away from the average, or near average, income-earners to those who are receiving their income directly or indirectly through these mammoth companies which have already come to control the economic life of the Commonwealth. Another consequence is that it has changed the allocation of resources, as the economist calls it. If these companies which I have mentioned are to be permitted, as they are being permitted, because of the failure of the bill to come to grips with the situation, to go on earning in one year an average of 18-J per cent, and up to 40 per cent, and 50 per cent., and even 250 per cent, in the case of General Motors-Holden's Limited, how can the Government be expected to get from the community, which has some of these opportunities of putting its moneys into investments showing these excessive rates of returns, enough funds to fill Commonwealth loans at 4 per cent, and 5 per cent? How can State instrumentalities, like the State Electricity Commission in Victoria, and others, which deal in essential services such as electricity, water supply, and sewerage, obtain their requirements? How can the problems of municipal councils which need so much money all over the Commonwealth be met ? Just as there is going on, under this Government's economic policy, an enormous transfer of income away from the average or common income-earner towards well-to-do persons, the resources naturally follow, because in a market economy where demand determines the allocation of resources, the men and materials will follow the money, and that is what is occurring. It is no wonder that supporters of this Government believe in the kind of economic policy which has prevailed. It has done them a great service over the last five or six years. This bill continues to render that service. It fails to come to grips with the situation. Il fails to stop this enormous travesty of a public policy which the Government professes and which reveals itself as a class economic policy of the worst sort. More important than anything else in respect of the Government's stated policy of controlling inflation is that the measure is likely to be unsuccessful, as every measure that the Government has taken since 1949 has been substantially unsuccessful, in coming to grips with inflation. A halt was called to inflation in 1952, but that halt was not called as a result of the policy applied in a measure of this sort, or in any other government measure. That halt was called because the private trading banks became panicky at their inability to supply funds to their overseas customers for contracts which they had entered into, and the banks, being, as they were, disturbed and panicky at the general situation, began to restrict credit. In that year there was an increase of only £3,000,000 in bank advances in this country. Another consequence of the Government's policy, which was not its dpi i hern te policy, the flooding of the Australian' markets by imports, caused considerable unemployment iti that year. So I submit that the Government cannot claim on any ground to have been successful on any of its material lines of policy in its attempts to meet the inflationary situation. This was the very situation to meet which the Government came into office in 1949. Since 1949 it has been preaching, in terms of putting value back into the £1, that it could cure inflation. Now, after nearly seven years, the retail price index in Australia is over 75 per cent., higher than it was when the Government took office. We have heard so much talk to-night from those gentlemen in the corner benches, who are supposed to represent the country, about the way in which Australian costs have risen during that period. What contribution do they think a 75 per cent, rise in prices has made to costs? Of course, it is the main factor in increasing costs, which make it so difficult now for Australians to export competitively to other countries where this kind of inflation has not been permitted. Since 1949, there is no country in the world where inflation has been permitted to go uncontrolled to the extent that it has in this country, and there is no country where prices have risen so rapidly as in Australia. It is time that this Government and its supporters faced up to the position. I did not hear the interjection made by an honorable member in the corner but if I had it would not make much difference because if it is at the same level as his contributions on other matters it is probably not worth hearing. Measures such as this are of crucial importance in the control of inflation and will have a consequence on the economic affairs of the Australian people for many years to come. The Government claims that this measure is designed to bring inflation under effective control, but as in other instances in which the Government has attempted to deal with this problem, it has failed on this occasion. It has failed to deal with company taxation. Unless it is prepared to face up to the job of imposing a progressive tax in order to check fantastically high protits at the source, the volume of private investment will continue to increase rapidly and cause still further inflation. Inflation is not caused to the same degree hy any other factor, as the Treasurer himself admitted in 1950. He then pointed out that if these forces were allowed to go unchecked., wage-earners would be forced,' because of increased prices of food, clothing and supplies, to fight for an increase in the basic wage and increased margins. If the leaders of the wage-earners did not fight for those increases they would be traitors to the people they represent. They have waged the fight with limited success. The present inflation is not a wage inflation although we have heard enough talk in this country about the effect of wage increases on inflation. That kind of talk is completely outmoded and is wrong. We can control inflation in Australia only by introducing an effective company tax, because it is in excessive company profits that inflationary pressures primarily lie. After making an objective analysis of this measure honorable members must come to the conclusion that it will fail to have the desired effect of checking inflation. Therefore, the Opposition opposes it root and branch. Question put - >That the bill be now read a second time. The House divided. (Mr. Deputy Speaker - Mr. C. F. Adermann.) AYES: 42 NOES: 28 Majority . . 14 AYES NOES Question so resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. {: .page-start } page 2166 {:#debate-30} ### BILLS RETURNED FROM THE SENATE The following bills were returned from the Senate without amendment : - >Defence ForcesRetirement Benefits Bill 1956. > >Gold-mining Industry Assistance Bill 1956. {: .page-start } page 2166 {:#debate-31} ### ADJOURNMENT {:#subdebate-31-0} #### Effects of Atomic Radiation Motion (by **Mr. Osborne)** proposed - >That the House do now adjourn. {: #subdebate-31-0-s0 .speaker-DB6} ##### Mr WENTWORTH:
Mackellar -- I wish to bring an important matter briefly to the notice of the House. There has been a considerable amount of publicity in the newspapers recently about the finding of a radio-active capsule by two children, about the consequent injury that they suffered, and also about some capsules that were labelled as radio-active but were not, in fact, anything more than hoaxes. The House must realize that, without detection instruments, it is impossible to tell whether these materials are radio-actively hot, because, although they are dangerous in the sense that, if they are brought in contact with a person, they will destroy his body and kill him, one does not feel any sensation while this destruction is taking place. The body is quite incapable of feeling or perceiving the damage it suffers. For most of the eventualities of life, we have a built-in pain sense that tells us when we suffer injury. If one puts one's hand on a hot stove, one feels pain. If one puts one's hand on something that is radio-actively hot, one's hand suffers injury just as much as it does if it is put on a hot stove, but one feels absolutely nothing. The Government must face this problem and take action to provide some kind of detection instruments so that we may know what is radio-actively hot and what is not. This little incident of a radio-active capsule may not seem to the House to be very important, but it is important as an indicator of something that may be of much more consequence. "We all hope that there will never be an atomic attack on this country. I consider that the odds are against that happening, but any one who told us for certain that it would not occur would be telling us wrongly. We simply do not know whether it will happen from now on. If such an attack occurred, there would be left about a great deal of residual radio-activity, the kind of thing that was exemplified in the little cobalt capsule to which I have referred, and whether you lived or died would depend upon your knowing whether the objects with which you came in contact were affected by this radioactivity. There is, literally, no way of knowing unless one has the proper instruments for detection. The authorities in both the United States of America and Britain are tackling this problem. If honorable members examine the statement on defence made a few weeks ago in the House of Commons, they will see that attention is being given to the provision of monitoring instruments, which will be essential to our survival if there should be an atomic disaster. Similarly, in the United States an attempt is being made to manufacture and to distribute, for the protection of the people, necessary monitoring instruments which will tell them whether material with which they are in contact is radio-actively hot. This knowledge may mean the difference between life and death. {: .speaker-KYC} ##### Mr POLLARD:
LALOR, VICTORIA · ALP -- In which pocket does one put this instrument? {: .speaker-DB6} ##### Mr WENTWORTH: -- The instruments are of two kinds. One is quite small, and it can probably be made in a form not much bigger than an ordinary fountain pen. This instrument records the total dosage received. There is some reason for thinking that this kind of instrument should be manufactured by the millions so that every one may carry one. I believe that it could be made relatively cheaply. The second kind of instrument is a rate meter, which is similar in principle to a geiger counter. It records, not the accumulated dose, but the rate at which the dosage is being received. Although as great a number of these instruments would not be needed, they are probably of even greater importance than the others, and they should be distributed in all districts so that the people could have access to them in order to ensure their survival. One of the things the Government must do is to ensure that these instruments are manufactured, perhaps not in astronomical quantities, but in adequate numbers, and that they are distributed among the population, perhaps to police stations or similar official offices, so that they will be available to the people should we suffer an atomic disaster. The availability of these instruments might make the difference between life and death. I understand that an atomic explosion was set off at the Monte Bello Islands only to-day. Within the next few days, an even bigger explosion will occur in the Pacific Ocean. These events are warnings to us that atomic disasters can happen. We hope they will not. We hope our own powers of deterrence will be sufficient to prevent them from happening in Australia. I think the odds are against them happening here, but the odds are not so great that il; would not be prudent to take out a little insurance. Although it may not be possible to protect people from the blast, the flame and the flash of an atomic explosion, it is possible to protect them against the contaminating effects of radio-activity, which will kill over a very much larger area than blast will do, if no precautions are taken. But we can protect ourselves by very moderate precautions within the contaminated area that is not affected by blast. Without these monitoring and detecting instruments that I have mentioned, we shall be quite powerless to protect our people. I believe we should be doing something about it now. I believe that the action required is already long overdue, and I think the small incident of the cobalt capsule 'that I have mentioned will serve as a warning to the House and to the country. {: #subdebate-31-0-s1 .speaker-KX7} ##### Mr WARD:
East Sydney **.- Mr. Deputy Speaker-** Motion (by **Mr. Osborne)** put - >That the question be now put. The House divided. (Mr. Deputy Speaker - Mr. C. F. Adermann.) AYES: 50 NOES: 21 Majority . . . . 23 AYES NOES Question so resolved in the affirmative. Original question resolved in the affirmative. House adjourned at 12.1 a.m. (Thursday). {: .page-start } page 2168 {:#debate-32} ### ANSWERS TO QUESTIONS *The following answers to questions were circulated: -* {:#subdebate-32-0} #### Australian Apprenticeship Advisory Committee {: type="1" start="1"} 0. Has the Government, in conjunction with the State governments, established an Australian apprenticeship advisory committee to co-ordinate apprenticeship throughout Australia and implement the recommendations of the committee of the Commonwealth-State apprenticeship inquiry? 1. If so, what is the personnel of the committee, and what interests does each individual represent? 2. If the advisory committee has not yet been appointed, will he state the cause of the delay in giving effect to this recommendation of the committee of inquiry? {: type="1" start="1"} 0. A conference of Commonwealth and State officers of labour and technical education departments in December, convened to coneider the implementation of the CommonwealthState apprenticeship inquiry's report, decided to recommend to the Commonwealth and State governments that an Australian apprenticeship advisory committee should be established. The State governments are at present considering this recommendation. The indications are that an agreement will be forthcoming and as soon as formal concurrence is notified by the governments steps will be taken to constitute the committee and arrange for its initial meeting. 1. The proposal is that the committee consist of two official representatives from each State (covering both the technical training and industrial aspects of apprenticeship), and representatives of the Department of Labour and National Service and Commonwealth apprenticeship and technical training authorities. Representatives of employers' and employees' organizations, as well as appropriate Commonwealth and State officers other than those already mentioned, will be co-opted. 2. See 1 above. {:#subdebate-32-1} #### Stevedoring Industry Inquiry {: type="1" start="1"} 0. Will he state the reason for his refusal to disclose the amount being paid as fees and allowances to the members of the committee which is at present inquiring into the Australian Stevedoring industry? 1. Are the members of the committee paid on the basis of a fixed amount for each sitting? 2. If not, how is the remuneration of committee members determined? 3. Will he now state what has been the total cost of the inquiry to date? 4. When is it expected that the committee of inquiry will conclude its work? 5. Upon how many days has the committee sat? 6. How many witnesses have been examined? {: type="1" start="1"} 0. As I have already informed the honorable member in reply to his earlier question, the committee is still proceeding with its inquiry and it would not be in accordance with normal practice to furnish, at this stage, particulars concerning costs. 1. Yes. 2. See answer to 2. 3. No, for the reasons outlined in 1 above. 4. Present indications are that the public sittings of the committee are likely to conclude by the end of June. The committee will then prepare its report, but I am unable to say when it will complete it. 5. 211. 6. 22.

Cite as: Australia, House of Representatives, Debates, 16 May 1956, viewed 22 October 2017, <http://historichansard.net/hofreps/1956/19560516_reps_22_hor10/>.

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