House of Representatives
6 November 1957

22nd Parliament · 2nd Session

  1. House of Representatives
  2. 22nd Parliament
  3. 1957

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

page 1859

QUESTION

NUCLEAR BOMB TESTS

Dr EVATT:
BARTON, NEW SOUTH WALES

– Has the attention of the Minister for Supply been drawn to the latest official report by the American Atomic Energy Commission on fall-out from nuclear tests? The report states, among other things, that the commission’s committee on biology and medicine has raised the question of whether nuclear tests are being kept at the necessary minimum in number and power. The report summarizes the effects which have already been estimated, including a definite, ultimate - but not immediate - increase in genetically defective children to 800 a year in the United States of America. World figures would be greatly in excess of that figure. Will the Minister look at this report? 1 have seen only a short summary of it. Will the Minister make it available to honorable members and state whether, in his opinion, the effects of nuclear tests as stated in the report would also obtain in Australia?

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

– I have heard of the report to which the right honorable member has referred, but I have not read it. I shall see whether a copy can be obtained and laid on the table of the Library. I shall also ask those who advise the Government to have it examined and analysed. If any contribution can be made on the substance of the report or its conclusions I shall let the honorable gentleman know.

Dr EVATT:

– Will the Minister bring it before the House?

Mr BEALE:

– I shall give consideration to that.

page 1859

QUESTION

TELEVISION

Mr WIGHT:
LILLEY, QUEENSLAND

– I ask the PostmasterGeneral whether, when consideration is given to the issue of licences for the establishment of television stations in Brisbane, priority will be given to companies whose finance is of local origin. Will such companies be given priority over companies financed in the southern States which may attempt to obtain a licence?

Mr DAVIDSON:
Postmaster-General · DAWSON, QUEENSLAND · CP

– It is the policy of the Government to encourage the local ownership, control, and operation of broadcasting and television stations. That is why a provision was inserted in the broadcasting and television legislation limiting the number of stations which may be owned by any particular interest. Of course, in framing its recommendations for the granting of television licences in Brisbane, the Australian Broadcasting Control Board will be influenced by the financial capacity of the applicants to produce programmes and operate a station in accordance with the high technical and programme standards required by the board. That will be a very important factor in determining the matter. If there are several applicants with similar qualifications, I think the board would give some degree of priority to local shareholdings and local applicants.

Dr EVATT:

– I ask the PostmasterGeneral a question supplementary to the one he has just answered. Will he also discuss with the board the fact that television licences already issued in Sydney and Melbourne are to some degree under the control of interests which have large newspaper circulations in those cities, and also great radio interests? Such a state of affairs may also obtain in Brisbane. Will the PostmasterGeneral inquire into this matter with a view to preventing the creation of a monopoly in television, or of a group constituting a monopoly, which would interfere with freedom of communications in this country?

Mr DAVIDSON:

– I thought I had already plainly stated the Government’s policy in this matter. It has been demonstrated on several occasions quite recently that the board, interpreting the Government’s policy, can be relied upon to recommend through me, as Minister, such action as may be necessary at any time to ensure that newspaper and other interests do not obtain a monopoly control of television broadcasting. That procedure will be followed in the investigations which the board is making in the other capital cities. The board’s recommendations will come first of all to me, and later will go before Cabinet, which will make the final decision. Monopoly control will, I assume, receive due consideration.

page 1860

QUESTION

SNOWY MOUNTAINS SCHEME

Mr DOWNER:
ANGAS, SOUTH AUSTRALIA

– Can the Prime Minister say what is the present position with regard to the dispute between the Commonwealth and the Premier of South Australia over the Snowy Mountains Agreement? Are the objections of the South Australian Government likely to be met by some compromise that will safeguard South Australia’s water rights beyond all possible doubt, and thereby render proceedings in the High Court unnecessary?

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– I have been present at two full length conferences with interested parties from South Australia, including the Premier. Since then, I have been in touch with the Premier of South Australia by correspondence. Until that correspondence has been concluded it is not possible to say anything of a definitive nature.

page 1860

QUESTION

COMMONWEALTH GRANTS COMMISSION

Mr CREAN:
MELBOURNE PORTS, VICTORIA

– I ask the Treasurer a question without notice. The 24th Report of the Commonwealth Grants Commission, recently tabled in this House, indicates some differences of opinion between the claimant States, the commission itself, and the Commonwealth Treasury, as to how the amount of such grants should be assessed. The view-points of two of the parties were expressed in documents, one from Western Australia, entitled, “The Need for increasing special grants under Section 96 “, and one from the Commonwealth Treasury, entitled, “ The reasons for special grants “. In view of the importance of financial arrangements between the Commonwealth and the States, will the Treasurer consult with the Commonwealth Grants Commission and the Government of Western Australia with a view to the publishing of these two documents?

Sir ARTHUR FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

– I shall consider the honorable member’s request.

page 1860

QUESTION

WOOL

Mr SWARTZ:
DARLING DOWNS, QUEENSLAND

– I direct a question without notice to the Minister acting for the Minister in charge of the Commonwealth Scientific and Industrial Research Organization. I refer to the new process for the treatment of woollen materials, which was developed by the C.S.I.R.O. and which will ensure that creases and pleats will remain fixed in the processed materials. Is it a fact that some clothing manufacturers in Australia have already commenced using this process, and that manufactured goods to which it has been applied will be available on the Australian market in the near future? Have reports indicated that the new process will give wool some further advantages over synthetic materials?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I am glad to be able to advise the honorable gentleman that a number of Australian clothing manufacturers have worked closely in collaboration with the C.S.I.R.O. wool textile research laboratories in developing the Si-Ro-Set wool-proofing process on an industrial basis. These firms are processing large trial quantities of garments by this method, and the treated goods will, I understand, be available shortly to the Australian public.

Mr Whitlam:

– Will you model them?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– So far, in my own household, a very reliable housekeeper has done what will, I hope, be done by this process in the future. As is well known, I think, wool possesses certain natural advantages over synthetic materials, but the process now developed, which will ensure the permanence of creases and pleats in treated woollen material, will give to wool, in addition to its other advantages, an advantage which has been until now peculiar to synthetic materials. This will further emphasize the unchallengeable supremacy of Australia’s greatest primary product.

page 1860

QUESTION

GOLD

Mr BEAZLEY:
FREMANTLE, WESTERN AUSTRALIA

– I direct a question to the Treasurer. During his absence from the House an allegation was made by the honorable member for Chisholm that £14,000,000 worth of Australian gold was sold in Hong Kong by the Commonwealth Bank to the Communist government in Peking. The Minister for Primary Industry, who, in the absence of the Treasurer, was conducting the debate for the Government, was unable to confirm or deny the truth of this allegation, but he promised that inquiries would be made. I ask the Treasurer whether those inquiries have been made, and, if so, with what result.

Sir ARTHUR FADDEN:
CP

– The inquiries have been made, and I shall be pleased to supply the honorable member with the information obtained.

page 1861

QUESTION

WOOL

Mr LUCK:
BRADDON, TASMANIA

– Has the attention of the Minister for Primary Industry been directed to the fact that Tasmania has obtained a world record price of over 500d. per lb. for fine wool? Is the Minister aware that a broadcaster in the country session of the Australian Broadcasting Commission recently indicated, wrongly, that the world record was a price of 475d. per lb. paid for New South Wales wool? As prices in excess of that have been obtained on a number of occasions in Tasmania, will the Minister investigate the matter with a view to issuing a statement to correct wrong impressions which could harm the fine wool industry of the island State?

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

– I doubt whether a statement of the kind alleged to have been made could possibly injure the reputation of the very fine wools grown in Tasmania. Yesterday, a very indignant gentleman, who occupies the post of Minister for Immigration, handed to me a telegram in which a strong protest was made at Mr. Brennan’s statement that he had classed wool which brought a record price of 475d. per lb. I have not been able to contact Mr. Brennan to find out just what he did say, but I have endeavoured to do so. In the meantime, I have been informed by my department that quite a lot of wool has been sold at a price of about 500d. per lb. - wool grown in Tasmania. I think that is a wonderful price. The honorable gentleman can be assured that if I can contact Mr. Brennan, I shall do so. I am certain that he will be only too happy to make a statement on the matter over the A.B.C. network.

page 1861

QUESTION

ST. MARY’S FILLING FACTORY

Mr MORGAN:
REID, NEW SOUTH WALES

– I direct a question to the Minister for Defence Production. Prior to the construction of the St. Mary’s ammunition filling factory, did the Government, in view of the vulnerability of that project, obtain the advice of any civil defence expert or authority as to the suitability of the site? Is it a fact that before the commencement of the project, or at least before it got properly under way, the Government sent overseas the Director of Civil Defence and other officers who gleaned valuable information on what is being done by other countries in regard to civil defence, especially in relation to underground munitions factories? Has the Government received any report or recommendation from the Director of Civil Defence in this connexion? If so, has the Government given any consideration to the recommendation or report in relation to the St. Mary’s project and any other munitions factories that may become necessary in the future?

Mr BEALE:
LP

– Many factors were involved in the decision that St. Mary’s should be the site of the new ammunition filling factory. In reaching the decision, the Government acted upon the advice of very experienced and knowledgeable people in the community. Since I was not the Minister in charge at the time, I cannot say precisely who they were. But the honorable member may rest assured that, in reaching the decision, the Government acted upon very knowledgeable, and very sound, advice.

page 1861

QUESTION

INTERNATIONAL AFFAIRS

Mr FORBES:
BARKER, SOUTH AUSTRALIA

– I address a question to the Minister acting for the Minister for External Affairs. Is the Minister aware that Jugoslavia has recently described Western Germany’s rupture of diplomatic relations with it as an act of aggression? Is he aware, also, that the Soviet Government has described Mr. Macmillan’s visit to Washington as aggression? Is he aware, further, that the President of Pakistan recently announced that, if India committed aggression against his country, it would be answered by aggression? In view of the constant abuse of the word “ aggression “, can the Minister say whether the United Nations committee appointed some six or seven years ago to define aggression is getting any nearer to the completion of its task?

Sir PHILIP MCBRIDE:
Minister for Defence · WAKEFIELD, SOUTH AUSTRALIA · LP

– I was not aware of the references to the word “ aggression “ by Jugoslavia, the Soviet Union, and other countries, as suggested by the honorable member, but I think that it is general knowledge that the word has been used rather loosely on a number of occasions. The definition of aggression has been the subject of international discussions, as I think the Leader of the Opposition knows, foi many years - even long before World War II. - but there has never been any prospect of reaching agreement on the matter. As the honorable member for Barker has indicated, the question has been before the International Law Commission of the United Nations General Assembly, and it is being discussed at the present time by the Assembly itself. The Australian Government’s view is that agreement on a definition of aggression is unlikely to be obtained, and that, even if it were, it would be of questionable value at any time.

page 1862

QUESTION

PENSIONS

Mr MINOGUE:
WEST SYDNEY, NEW SOUTH WALES

– Is the Treasurer aware that the Sydney City Council has voted £55,000 to give one week’s wages to all male age and invalid pensioners within the city boundaries who, health permitting, will give their services in work? Will the right honorable gentleman give age and invalid pensioners an extra week’s pension as a Christmas gesture in order to enable them to spend Christmas week free from want?

Sir ARTHUR FADDEN:
CP

– I am nol aware that the Sydney City Council has done as the honorable member has indicated. This Government is not prepared to go any further than the pension increases and concessions outlined in the Budget.

page 1862

QUESTION

TAXATION CONCESSIONS

Mr HAWORTH:
ISAACS, VICTORIA

– I desire to ask the Treasurer a question. Is it a fact that gifts to senior technical schools are not allowable tax deductions as are gifts to universities and other educational bodies? If this is so, will the Treasurer consider bringing senior technical schools, which are important educational institutions, into line with the universities?

Sir ARTHUR FADDEN:
CP

– This Government has already gone a long way in the encouragement of education by means of taxation concessions. It has provided for the deduction of gifts to school and college building funds including, of course, funds for the building of technical schools. It is true that gifts to universities are deductible even though the moneys donated are not applied to the construction and maintenance of buildings. The Government has received many representations for increased concessions in relation to not only technical schools and colleges but also many other activities. I shall certainly consider the honorable member’s request that the tax allowances for gifts to technical colleges be brought into line with gifts to universities.

page 1862

QUESTION

CYCLONE DAMAGE RELIEF

Mr RIORDAN:
KENNEDY, QUEENSLAND

– I preface my question, which is directed to the Prime Minister, by pointing out that it was announced over the radio this morning that the township of Cloncurry in north-west Queensland had been hit by a violent cyclonic blow, that many homes had been flattened, and that every house in the township had been damaged in some way. I ask the right honorable gentleman whether the Government will join with the Queensland Government in granting financial and any other necessary relief to the civilian population.

Mr MENZIES:
LP

– I regret to hear this information, which I had not heard before. I do not need to remind the honorable member that the provision of relief in cases of hardship or great gravity is the subject of a well-established procedure between the State governments and the Commonwealth Government. If an application is to be made by the Queensland Government, no doubt we will receive it in due course. We will then consider it.

page 1862

QUESTION

WOOL

Mr TURNBULL:
MALLEE, VICTORIA

– I ask the Minister for Trade the following questions: Is it a fact that the adverse trade balance of France with Australia has had or may have the effect of reducing competition at auctions of Australian wool? Is any action contemplated to overcome this? Is it true that the recent competition of Japan at wool auctions in Australia has done much to hold wool values?

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

– It is a fact, I think, that there has been some reduction of the strength of French competition at our wool auctions because of a well-known balance of payments problem in France. Fortunately, that situation coincided with very strong competition from Japan which existed throughout the whole of the last wool-selling season, and which has prevailed during the present season. 1 think Australian wool-growers are fortunate in that the recent agreement with Japan ensures that, although Japan cannot undertake to buy a stated quantity of wool, the full strength of Japanese competition will always be experienced on the Australian market.

Mr Turnbull:

– What is the position in relation to France?

Mr McEWEN:

– There have been discussions with France in this connexion for rather more than a year. At the invitation of the French Government, I went to Paris about fourteen months ago to discuss this matter. I speak in broad terms when I say that it has not been possible to make any special arrangement that would lead to an improvement of the balance of payments situation between Australia and France without infringing the rules that preclude discrimination against certain countries in favour of one, which we observe. I remind the House that competition from France or any other country is not determined merely by the balance of payments as between that country and any other single country from which it wishes to buy. The current problem is one more for France in relation to her total world exports rather than to Australia especially.

page 1863

QUESTION

CANNED FISH

Mr BARNARD:
BASS, TASMANIA

– Has the Minister for Trade read the statement of the general manager of Fish Canneries of Tasmania Proprietary Limited that disaster faces the industry unless the Japanese Trade Agreement is changed drastically? Is he aware that many employees have been dismissed from the industry and that further retrenchments are expected? In view of the seriousness of the situation, will the Minister arrange for a representative of the Department of Trade to examine the position and to meet representatives of the industry as soon as possible in order to prevent further serious repercussions?

Mr McEWEN:
CP

– I have read a statement in the press attributed to the manager of an important fish cannery in Tasmania who, stating the problems of his company, attributes these problems to the operation of the Australia-Japan trade treaty. I am sure that I can say, beyond any fear of contradiction, that the operation of the Australia-Japan trade treaty has not had any measurable effect on the transactions of that particular canning company, or, indeed, of any other Australian canning company. The facts of the matter are these: Before the trade treaty was signed there was no licensing limitation on the importation of canned fish from Japan; so the treaty has not added at all to the opportunity of Australian traders to import canned fish from Japan. It is true that the operation of the trade treaty has had the effect of reducing both duty and primage to a total equivalent, I am advised, of about 3d. per half-pound of canned fish, but it has not had any significant effect in inducing a greater flow of canned fish from Japan. In fact, Japan has been the overwhelming supplier of canned fish to Australia for a good few years past. Indeed, about 70 per cent, of our canned fish has come from Japan, but the import licensing statistics at the present time show that there has been a diminution in the imports of canned fish, including canned fish from Japan. Speaking from memory, the total value of imports in the first nine months of 1956 was £700,000, and in the first nine months of the succeeding year it fell to £500,000. I believe that there are two explanations of the problem of the Australian fish canning industry. One is that there is undoubtedly a preference by Australian consumers for the high-quality canned salmon that comes from Japan.

Mr Barnard:

– That would have something to do with prices.

Mr McEWEN:

– It has something to do with prices. In the second place, there has been a substantial relaxation of control on the importation of frozen, fresh and smoked fish, with the result that there has been a marked changeover in Australian consumption of imported fish from canned fish to fresh, frozen and dried fish. The Department of Trade has been studying the problem, and I myself have been studying it for some considerable time. I think that the gentleman who made the statement to which the honorable member for Bass referred has been in touch with the department. He has been advised - indeed the whole Australian fish-canning industry has been advised - that if those engaged in the industry feel that they can show that the operation of the Australia-Japan trade treaty is impairing or seriously damaging their business it is open for them to take appropriate action. The first thing that they could do is to appoint a panel representing the industry, which would consult with the officers of the Department of Trade, as has already been done in the case of twenty-odd industries which feel that they may be adversely affected by the trade treaty. Notwithstanding that that invitation has been open for more than a month, no panel has been nominated by the Australian fish-canning industry.

page 1864

QUESTION

UNITED KINGDOM BANK RATE

Mr SNEDDEN:
BRUCE, VICTORIA

– Can the Minister for Primary Industry give the House any information concerning the likely effect on the prices of Australian wool and wheat of the increase of the United Kingdom bank rate to 7 per cent?

Mr McMAHON:
LP

– I do not think that the recent change in the United Kingdom bank rate has had any effect on world wheat prices. The United Kingdom must, in fact, purchase wheat for its own requirements, and therefore I do not think that the bank rate will have a decisive influence there. There has been a slight weakening of the market for wool due to a combination of circumstances, and I cannot say in precise terms - nor for that matter could anyone else- what the effect of the bank rate on the price of wool might be. I can state that the increase in the bank rate was intended to introduce a deflationary element, and that this would tend to decrease the amount of purchases made by that country. It might, therefore, have some effect upon the price of wool. But I should like to repeat - and I am sure that the honorable gentleman would like me to repeat - that wool is standing up magnificently under present circumstances, and is fighting back well. Those who purchase it at the present prices are getting it really cheaply; they are getting a genuine bargain.

page 1864

QUESTION

POSTAL DEPARTMENT

Mr KEARNEY:
CUNNINGHAM, NEW SOUTH WALES

– I ask the PostmasterGeneral whether it is a fact that a sixteen years-old youth employed at the Wollongong Post Office as a telegram messenger has received a week’s notice of dismissal, which becomes effective in a few days. Will the Minister deny that this dismissal is the outcome of a departmental medical report, and is caused by the lad having a minute shoulder disability which is the aftermath of an attack of polio suffered at seven years of age? Will the Minister take action to cancel the dismissal notice so that proper consideration may be given to my own views, and those of the Wollongong Crippled Children’s Society, and justice extended to this lad?

Mr DAVIDSON:
CP

– I am not quite sure whether the honorable member is referring to a matter about which he has already made representations to me. He has not mentioned the name of the person concerned. Naturally, I am not advised from day to day of any dismissals which may occur in my department, and until I am given the name of the person concerned, 1 cannot investigate the matter. If the honorable member supplies it I shall be glad to look into the whole question.

page 1864

QUESTION

CANCER RESEARCH

Mr SWARTZ:

– Can the Minister for Health say whether it is a fact that an electronic computer, which may assist research into the causes of cancer, has been developed in the United Kingdom? If so, is any information on this computer, which would be of assistance to medical authorities in Australia, yet available?

Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– I understand that some progress has been made in the development of such a computer. However, as far as I am aware, very few details of it have reached this country as yet.

page 1864

QUESTION

MERINO SHEEP

Mr CURTIN:
KINGSFORD-SMITH, NEW SOUTH WALES

– My question to the Minister for Primary Industry relates to the serious allegation against the South African Government that, contrary to the terms of an agreement with the Australian Government, it has sold to private interests merino rams which it was permitted to import from this country. Would the Minister, at the conclusion of the Commonwealth Parliamentary Association’s conference in Delhi, to which I understand he is to lead a delegation, proceed to South Africa and make a personal investigation on the highest level? Also, will he, upon his return, report to this Parliament on the accuracy or otherwise of these allegations?

Mr McMAHON:
LP

– I well remember that one of the first speeches I made on wool was about the growth of the ‘ merino wool industry in Australia. If my memory serves me correctly, away back in 1797

Australia imported merino sheep from South Africa. Indeed, no less a person than John Macarthur imported them from the Cape of Good Hope. Later, Samuel Mccaughey imported Vermont merinos from the United States of America. Therefore, it always strikes me as peculiar that the claim should be made that no merino blood is to be found in the sheep of either South Africa or the United States of America. So far as the four rams exported to South Africa are concerned, one died, one did not do the job that a ram is normally purchased to do, one proved somewhat indifferent, and the other - I am now quoting from official records - proved to be satisfactory. There has been a difference of opinion between the Commonwealth and South African Governments as to the interpretation of the licence and whether the offspring of the Australian ram and South African ewes could be sold. It was an honest difference of opinion, and we are now discussing with the South African Government, on a most friendly basis, just what should be done in the future. We are attempting to evolve satisfactory arrangements acceptable to both governments. As soon as we have been able to reach an agreement, I shall be happy to let the honorable member for Kingsford-Smith know.

page 1865

QUESTION

NATIONAL HEALTH ACT

Mr FORBES:

– Is the Minister for Health aware of the concern expressed by the Adelaide Chamber of Commerce and other bodies at those sections of the National Health Act which give government officials power to deal with medical practitioners and chemists for alleged offences and to publish in the Government “ Gazette “ the names of persons against whom action is taken? Is it true that such a procedure may deny to the persons concerned their right to a fair trial?

Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– I was not aware that the Adelaide Chamber of Commerce, nor indeed any other such bod)’, objected to any provisions of the National Health Act. None of them has addressed any remonstrance to me on the subject. 1 can assure the honorable gentleman that nothing in the National Health Act prevents any one from having a fair trial,

page 1865

QUESTION

SUPERANNUATION

Mr MAKIN:
BONYTHON, SOUTH AUSTRALIA

– I address a question to the Treasurer. I make this inquiry on behalf of thousands of retired public servants who are substantially dependent on superannuation payments. Will the Treasurer have the claims of these persons for increased payments to meet increased living costs submitted to the Superannuation Board so that the board can report on the possibility of increased payments being made from the fund?

Sir ARTHUR FADDEN:
CP

– Yes, I will accede to that request.

page 1865

QUESTION

MERINO SHEEP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

– My question to the Minister for Primary Industry is supplementary to the question asked a few minutes ago by the honorable member for Kingsford-Smith. When Australian rams were sent to South Africa, was a provision inserted in the export permit, prohibiting the sale of their progeny to any other country? Was a similar provision written into the permit for the export of rams and stud ewes to the United States of America in 1951? Is it true that the United States is now advertising for sale the progeny of these animals, although they were sent to that country originally for scientific purposes only? If it is true that the provision to which I have referred was written into the permit, will the Minister have the permit, or the provision that was written into it, laid on the table of the House? Finally, if it is true that such provisions have been disregarded by any of the countries concerned, will the Minister give a guarantee to the people of Australia, particularly to those engaged in the wool industry, that never again will Australia take the risk that it took in 1951 and 1954?

Mr McMAHON:
LP

– As is well known, an embargo has been imposed on the export of Australian merino rams which is relaxed only under very special circumstances and for scientific purposes. The three rams that were exported to the United States of America are now dead. So far as South Africa is concerned, there is an honest difference of opinion between us as to the interpretation of the agreement about which we have had very friendly and amicable discussions with the South African Government in order to clear up the doubts.

As soon as the interpretation is cleared up I will convey the result to the honorable member.

page 1866

QUESTION

TABLING AND PRINTING OF REPORTS

Mr WHITLAM:

– My question is directed to you, Mr. Speaker. Can you say how many reports have been tabled in the House during the present Parliament? How many were ordered by the House to be printed, and how many of the remainder were recommended by the Printing Committee to be printed? If you propose to give a written reply, can you supply the names of the reports concerned, the dates upon which they were tabled, the dates upon which the House ordered them to be printed, and the dates upon which the Printing Committee’s recommendations were made to the House?

Mr SPEAKER:

– If the figures can be compiled they will be made available to the House.

page 1866

QUESTION

GOVERNMENT LOANS AND FINANCE

Mr COUTTS:
GRIFFITH, QUEENSLAND

– In view of the statement of the Premier of Queensland to the effect that a new governmental authority will be set up in Queensland to control water and sewerage services in the City of Brisbane and adjoining shires and will be assured of adequate loan funds, either by grant from the State Government’s loan funds or by its own efforts on the loan market, will the Treasurer say whether any loan approved for this authority by the Australian Loan Council will be conditioned by the amount which the authority may receive from the State Government or may raise on the market?

Sir ARTHUR FADDEN:
CP

– This matter, by its very nature, must be considered in a constitutional way by the Australian Loan Council.

page 1866

QUESTION

WHEAT

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

– I direct my question to the Minister for Primary Industry. In view of the great crisis in the New South Wales poultry industry, has the Minister as yet agreed to any of the requests submitted by the delegation from that industry which met representatives of his department last week? In particular, will urgent consignments of wheat be despatched from

South Australia or Western Australia to relieve the desperate position in New South Wales? Will the Minister give early consideration to the request that the Government meet freight costs in respect of wheat supplies to the poultry industry in New South Wales in order to avoid the imposition of an impossible cost burden on that industry?

Mr McMAHON:
LP

– As I indicated to the House yesterday, the question of availability of wheat, particularly for stock feed, is under consideration by the Government. I have already drawn the attention of the Australian Wheat Board to the position of the poultry industry in New South Wales and the necessity for making adequate provision for the supply of poultry feed. I have already written a letter to the representatives of the industry - or at least it is awaiting my signature - and I will make a copy of it available to the honorable member.

page 1866

QUESTION

INDUSTRIAL ACCIDENTS

Mr WEBB:
STIRLING, WESTERN AUSTRALIA

– I ask the Minister for Labour and National Service: Is it a fact that last year one Australian worker in ten suffered an injury as a result of an industrial accident? I understand that 278,000 were injured and 500 were killed. Is it also a fact that this rate is much greater than that in any other country, the figure in Great Britain and the United States of Americabeing one in 63-

Mr SPEAKER:

– Order! The honorable member is giving information instead of seeking it.

Mr WEBB:

– What has been done by theDepartment of Labour and National Service in the field of industrial safety with a view to reducing the number of these accidents? Can the Minister account for the fact that despite this matter having been raised repeatedly in this House the rate of industrial accidents has not been reduced?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I am unable to give offhand confirmation of the details which the honorable gentleman has put to the House. I do agree with him that the number of industrial accidents in Australia is much higher than it should be. I have said more than once publicly that we lose through industrial accidents, many of them avoidable, from four to five times - conservatively estimated - what we lose in working time through industrial disputes.

Dr Evatt:

– Through lack of precautions.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I have no doubt that that is a factor. The State governments, and this Government, have inspectors whose business it is to police the awards of the various tribunals. I can assure the honorable gentleman that a great deal is being done by the Department of Labour and National Service, in collaboration with State Departments of Labour, and in cooperation with the trade union movement and the employer organizations, to improve the present situation. We find that some of our largest and best conducted establishments which have gradually instituted safety campaigns have been able to produce quite a dramatic reduction in the incidence of industrial accidents in their plants. We are working now through, first, the Standing Committee on Productivity of the Ministry of Labour Advisory Council, and through that with the parent body towards instituting an Australia-wide campaign in association with the State governments. The preparatory work for that is well in hand and I hope it will shortly-

Mr Webb:

– It has been going on for -some years.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– One of the problems is that no information has so far been available from the State governments or from commercial and industrial establishments. We have improved the statistical side. It has not been going on, so far as I am aware, in an organized way oi with any central direction. We are now “trying to remedy that defect and I hope the result will be a substantial improvement in the industrial field.

page 1867

QUESTION

WORKERS’ COMPENSATION

Mr LUCHETTI:
MACQUARIE, NEW SOUTH WALES

– I again direct the -attention of the Minister for Labour and National Service to representations that J made some time ago with respect to the -inadequacy of compensation payments made under federal jurisdiction. Is the Minister aware that compensation payments under the federal workers’ compensation act lag very substantially behind payments made hy certain State authorities? Will the Minister promise to review the position at an early date?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I am not prepared to accept the statement that the provisions in our compensation legislation lag behind those of the States. It may be that in a particular State some provisions can be shown to operate more favorably than the corresponding provisions in Commonwealth legislation. However, there may be other provisions in the Commonwealth legislation which compare more than favorably with those of the particular State. It has been our objective to keep our compensation provisions at least up to the level which State governments throughout Australia have regarded as reasonable in these matters, and so far as I am aware that position still obtains. I shall have the query of the honorable gentleman carefully examined, and if the examination shows any desirable change in the position that, too, will be given sympathetic consideration.

page 1867

QUESTION

INTERNATIONAL LABOUR ORGANIZATION

Mr HAROLD HOLT:
Minister for Labour and National Service · HIGGINS, VICTORIA · LP

– by leave - I lay on the table the following papers: -

International Labour Organization - Fortieth Session, Geneva, June, 1957 - Reports of the Australian Government, Employers’ and Workers’ Delegates.

I wish to make a short explanatory comment. I have prefaced these reports with some introductory observations of my own. The customary technical report and commentary on the conference is given by Mr. H. A. Bland, the secretary of my department, who, as a consequence of my election to the presidency of the conference, assumed leadership of the Australian delegation.

It will be remembered that there have been, during the period of this parliamentary session, criticisms from employer organizations and members of the Opposition directed to the course of action and votes recorded by representatives of this Government at conferences of the International Labour Organization, particularly in relation to the long-standing issue of employer representation from Communist countries, and the position we took up towards Hungarian delegates at the most recent conference. At the time when these criticisms were made, I promised the Parliament a detailed statement on these matters. I have, therefore, covered them at some length in my introduction to the report.

The Leader of the Opposition (Dr. Evatt) asked me earlier in the session whether I would undertake to “ bring before this House for ratification and adoption, the recommendations and convention agreed to by the I.L.O.”. He went on to comment that this Government had brought none of these matters to the House during its term of office. His question seemed to be based on a misconception. I.L.O. instruments are not presented to Parliament for ratification or adoption. It has always been the practice for their ratification to be made as an executive act by the Commonwealth Government.

On the other hand, the texts of all the conventions and recommendations adopted by sessions of the International Labour Conference, during the period of office of the present Government, have been submitted to Parliament for consideration - as appendices to the reports of the Australian Government delegates to the sessions in question. This procedure was not followed so consistently when the Labour party was in office.

The Leader of the Opposition seems to have overlooked the fact that, far from ignoring the Parliament in these matters, it was I who initiated the practice of submitting to Parliament a statement dealing with the action to be taken, or proposed to be taken, by the Government on these instruments - which is in conformity with the I.L.O. constitution. On 15th October, 1953, I submitted such a statement in respect of the conventions and recommendations adopted at the 1951 session, and on 30th October, 1956, I submitted a further statement on the conventions and recommendations adopted at the 1952, 1953 and 1954 sessions. A further draft statement has been prepared in respect of the 1955 instruments, while the texts of the 1956 recommendations are now distributed to the appropriate authorities - Commonwealth and State - with a similar end in view. This action will also be taken on the 1957 instruments. Some delay in completing this procedure for each year is inevitable, when up to 30 separate authorities in Australia are usually concerned, and, moreover, when it is necessary to obtain the views of seven governments at the ministerial level, and occasionally at the Cabinet level.

Copies of the report which I have just tabled can be obtained from the Clerk of the Papers.

Dr EVATT:
Leader of the Opposition · Barton

– by leave - It is perfectly correct, as the Minister for Labour and National Service (Mr. Harold Holt) has stated, that I did not use the technical term for action by this Parliament. What I was referring to was what the Government has done to see that the agreements, or recommendations, or conventions made at the International Labour Organization became effective within Australia. There is a theory, which the right honorable gentleman has adopted, that a subject not specifically within Commonwealth power is to be turned over to the States, and that procedure in general means - or often means - that nothing is done. The correct and more modernly accepted method of ratifying agreements of the I.L.O. is that, if the convention is on a subject dealt with by the I.L.O., which is an international organization, this Parliament, under its external affairs power, would ratify it without reference to the States. I should like the Minister to consider that aspect specifically. I think he will find that the old procedure is not now recognized as valid and that Australia, through the Commonwealth Government, if it is party to a recommendation, accepts the recommendation, and a fortiori agrees to the convention, has effective power to include it as part of the law of the Commonwealth.

I admit that this is a complex constitutional question, but it is important that we should not lag behind other countries in ratifying I.L.O. agreements. Reference to the States means continuous delay, even for years, and, as the right honorable gentleman points out, not only one government may be criticized for that delay. What I asked for was a review of the present situation.

page 1868

ASSENT TO BILLS

Assent to the following bills reported: -

Supply Bill (No. 2) 1957-58.

Supply (Works and Services) Bill (No. 2) 1957-58.

page 1868

LEAVE OF ABSENCE

Motion (by Sir Arthur Fadden) - agreed to -

That leave of absence for one month be given to the honorable member for Gippsland (Mr. Bowden) on the ground of parliamentary business overseas.

Motion (by Mr. Harold Holt) - agreed to -

That leave of absence for one month be given to the honorable member for Mitchell (Mr. Wheeler) on the ground of parliamentary business overseas.

Motion (by Dr. Evatt) - agreed to -

That leave of absence for one month be given to the honorable members for Blaxland (Mr. E. J. Harrison) and Lalor (Mr. Pollard) on the ground of parliamentary business overseas, and to the honorable members for Banks (Mr. Costa) and Newcastle (Mr. Watkins) on the ground of ill health.

page 1869

GOVERNMENT BUSINESS

Precedence

Motion (by Mr. Harold Holt) agreed to -

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

page 1869

STATES GRANTS BILL 1957

Message recommending appropriation reported.

In committee (Consideration of GovernorGeneral’s message):

Motion (by Sir Arthur Fadden) agreed to -

That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to grant financial assistance to the States of South Australia, Western Australia and Tasmania.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Sir Arthur Fadden and Mr. Osborne do prepare and bring in a bill to carry out the foregoing resolution.

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.

The purpose of this bill is to authorize the payment during the current financial year of special grants amounting to £19,500,000 to South Australia, Western Australia and Tasmania. The payment of these grants was recommended by the Commonwealth Grants Commission in its twenty-fourth report, which has now been tabled. A new feature of the bill this year is that it also authorizes the payment of advances to the claimant States in the early months of 1958-59, pending the enactment of the States Grants Bill 1958.

In its twenty-fourth report, the Commonwealth Grants Commission has continued to base its recommendations upon the general principle of financial need. The commission has interpreted this principle to mean that, provided the efforts made by a claimant State to raise revenue and control expenditure are reasonable by comparison with the efforts made by the nonclaimant States, its special grant should be sufficient to enable it to function at a standard not appreciably below that of the non-claimant States. In applying this principle the commission compares the budget results of the claimant States with those of the non-claimant States and takes particular account of differences in levels of expenditure and in efforts to raise revenues.

The special grants recommended each year are divided into two parts. One part represents the commission’s estimate of the State’s financial needs for the current financial year. This part is regarded by the commission as an advance payment which will be the subject of a final adjustment two years later when the commission has examined the audited budget results of the States for that year. The other part of the grant represents a final adjustment of the special grant paid two years earlier. The grants recommended by the commission for payment this year are therefore made up as follows: -

In total the special grants recommended for payment in 1957-58 are £1,000,000 greater than those paid to the claimant States last year. Since it is estimated that the tax reimbursement grants to the claimant States will rise by about £3,653,000 in 1957-58, the net effect of adopting the commission’s recommendations will be to increase the total revenue grants to the claimant States by about £4,653,000, as compared with those made last year. Of this total increase, South Australia will receive £1,603,000, Western Australia £2,218,000, and Tasmania £832,000. The special grants recommended by the Commonwealth Grants Commission have been adopted each year by the Commonwealth Government of the day and the Government considers that the commission’s recommendations should be adopted again this year.

As I mentioned earlier, the bill this year contains a new clause. It authorizes the payment to the claimant States next year of advances pending the authorization by Parliament of the special grants for that year. Hitherto, these monthly advances, which are based on the special grants for the preceding year, have been made from tn Treasurer’s Advance. They now represent a substantial amount, and I think it desirable that, in future, they should be specifically authorized by Parliament. A clause conferring this authority has, therefore, been included in the bill. I commend the bill to honorable members.

Debate (on motion by Mr. Webb) adjourned.

page 1870

COMMONWEALTH AID ROADS (SPECIAL ASSISTANCE) BILL 1957

Message recommending appropriation reported.

In committee (Consideration of GovernorGeneral’s message):

Motion (by Sir Arthur Fadden) agreed to -

That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to grant further financial assistance to the States in connexion with roads, and for other purposes.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Sir Arthur Fadden and Mr. Osborne do prepare and bring in a bill to carry out the foregoing resolution.

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.

The purpose of this bill is to provide for the appropriation of £3,000,000 in both 1957-58 and 1958-59 to supplement the payments already authorized under the Commonwealth Aid Roads legislation. In 1949-50, when the present Commonwealth Government first took office, the Commonwealth aid roads allocations amounted to £9,367,000. At that time, the annual allocation for roads from the petrol tax consisted of 3d. a gallon in respect of imported petrol and 2d. a gallon on locally refined petrol, plus an amount of £3,000,000 for roads in rural areas. The petrol tax allocations for roads purposes have been increased by the present Government on a number of occasions since 1949-50 and they now stand at 8d. a gallon in respect of both imported and locally refined petrol.

As a result of these larger allocations and of the rise in petrol consumption, the Commonwealth aid roads allocations this year are expected to reach. £34,000,000. This represents an increase of nearly £25,000,000, and is about three and a half times as much as was being provided when the present Government first took office eight years ago. Indeed, during this eight-year period, the Commonwealth will have provided, under the Commonwealth aid roads legislation, no less than £180,000,000, compared with a total of £80,000,000 provided by successive Commonwealth governments during the preceding 24 years from the inception of the Federal aid roads scheme in 1926. Any government would have good reason to feel proud of this record.

Nevertheless, the Government has decided that some further assistance for roads should now be given to the States. The existing Commonwealth aid roads legislation will expire on 30th June, 1959, and the whole question of Commonwealth assistance for roads will therefore be reviewed before that date. In the meantime, however, it is proposed in the present bill to make available for roads an amount of £3,000,000 in each of the years 1957-58 and 1958-59. As honorable members are aware, action has also been taken to impose a tax of ls. a gallon on automotive diesel oil consumed in road vehicles, thus ensuring that the operators of diesel-driven vehicles make some contribution towards the cost of building and maintaining the roads they use. The proceeds of that tax are estimated at £2,000,000 in this financial year and £3,000,000 in 1958-59.

As the present bill is essentially an interim measure, the Government felt that it would be preferable to leave the existing Commonwealth aid roads legislation intact and to seek authority for this additional payment in a separate bill. In adopting this procedure, the Government has sought to avoid anticipating the results of the review of the main legislation which will be made in due course.

As in the main legislation, the bill provides that the moneys granted to the States may either be used by the State governments, or be passed on by them to their associated local authorities for expenditure on roads or for the purchase of roadmaking equipment. The small portion retained for roads serving Commonwealth purposes may be used by the Commonwealth for expenditure on roads in the Territories, or on other roads in which the Commonwealth might have a special interest. I might add that it was considered unnecessary, in this interim measure, to repeat some of the detailed provisions in the main act relating to such matters as rural roads and works connected with transport.

Under the Commonwealth aid roads distribution formula, Tasmania receives 5 per cent, of the total grants and the balance is distributed among the other States, threefifths in proportion to their population and two-fifths in proportion to their areas. When determining the distribution of this supplementary payment of £3,000,000, the Government considered various alternative methods which have been suggested in recent times to take account of factors additional to area and population. It has finally decided that, rather than adopt at this stage a new formula which might be taken as anticipating its review of the main legislation, the special grant of £3,000,000 should be distributed in the manner set out in the schedule to the bill. The question of whether or not any change should be made in the distribution of the main Commonwealth aid roads grants is a matter which will be considered in due course.

It is estimated that, after taking account of this special assistance of £3,000,000, the total Commonwealth aid roads alloca tions in the current financial year will amount to £37,000,000, or nearly £5,000,000 more than last year. Further details are given in the following table which, with the concurrence of the House, I shall have incorporated in “ Hansard “: -

I commend the bill to honorable members.

Debate (on motion by Mr. Clarey) adjourned.

page 1871

QUESTION

TARIFF PROPOSALS 1957

Customs Tariff Amendment (No. 1)

In Committee of Ways and Means: Consideration resumed from 22nd May (vide page 1827), on motion by Mr. Osborne -

  1. That the Schedule to the Customs Tariff 1933-1956 be amended as set out in the Schedule to these proposals . . . (vide page 1784).

Motion - by leave - taken as a whole.

Mr CALWELL:
Melbourne

.- The various tariff proposals that come under the heading “Customs Tariff Amendment (No. 1) “ were explained to the Parliament some months ago-

Mr Osborne:

– Not so very long ago, incidentally.

Mr CALWELL:

– It was on 22nd May. The Minister may not think it is so long ago, but it is a long time to have had these proposals before the Committee of Ways and Means without honorable members having had an opportunity to debate them.

I understand that the proposals before us result from the new trade agreement with the United Kingdom, in accordance with which we have reduced our duties considerably, which may or may not be a good thing for Australian industry. Included among the items covered by the Minister’s proposals are cotton goods, woollen goods ‘and other textiles, and I know that the textile trade in Australia is suffering from ;the competition of other countries. I know that it is experiencing great difficulties, and the benefits to be extended under these proposals may ultimately be extended to Japan, Germany and other countries in Respect of similar goods manufactured in *hose countries, where production is rising and productivity increasing. Goods produced in those countries are becoming fiercely competitive with similar goods produced in the United Kingdom. The Government may eventually have to bring down further customs tariff proposals to help Australian industry to survive. It is a pretty bad state of affairs when not only can we not extend our export markets, but find Australian industries having to fight against overseas competition for the Australian market.

I am not sure how these tariff proposals will affect Australian industry, but I assume that the Government is keeping a watchful eye on the matter, and that the Minister for Customs and Excise (Senator Henty) will, with his officers, not only watch the position carefully, but also heed the advice of persons in control of the industries in Australia that will be affected by these tariff proposals. Those persons, of course, are concerned primarily with making profits, but large sections of the Australian community are employed by them. Employment and profits are matters of the gravest concern to many people whose interests are common in so far as they are all involved in the success or failure of a particular branch of our activities. Cases have occurred recently of factories closing down or working short time as a result of the competition of goods produced overseas. In Melbourne and Sydney the textile trade has experienced a great degree of recession, and perhaps the Government will be obliged to consider additional protection for the textile industry in the months ahead.

I believe that Australian manufacturers are worried not so much about United Kingdom competition as about Japanese competition. The way in which Germany has again become such a formidable trade competitor, so soon after the devastation caused in that country by World War II., is almost a miracle of survival and revival. The British are themselves worried about competition from Germany, not only in the textile industry, but also in shipbuilding, the manufacture of motor cars and in many other industries. We in Australia have reason to be fearful, because our people are employed under conditions that are among the best in the world. Employees of British manufacturers work a week of at least 45 hours. They work for a wage of about £6 12s. a week. They have no paid annual holidays, no paid sick leave and no long service leave, and during the course of a year they do not enjoy as many public holidays as Australian workers do. These differences in conditions make it difficult for the Australian manufacturers to survive against the competition of even British manufacturers.

The whole problem comes down to the adequacy of tariff protection. One man’s meat is another man’s poison. The more the British worker succeeds in reducing his working week or increasing his wages, the better it is for the Australian manufacturer and worker, because competition by Britishmade goods is thereby lessened. It would be a good thing for the world if the Japanese, the Germans and all other peoples worked a 40-hour week as Australians do.

Mr Anderson:

– That is what I told the honorable gentleman.

Mr CALWELL:

– I know that the honorable member for Hume is sometimes right. I have even quoted portions of some of his speeches with approval. I recollect now that he made this very point some years ago, and I am glad to see that he is still of the same mind.

I rise, not to oppose anything that the Government intends to do in this matter, but to utter a word of warning and try to obtain assurances, insofar as they can be given by the Minister, that what is to be done under these proposals will not be harmful to Australian industries, and that if a situation develops which can result in harm to the Australian industries concerned, the Government will take early effective remedial action. That is all I have to say with regard to Customs Tariff Amendment (No. 1).

Mr OSBORNE:
Minister for Air · Evans · LP

– The honorable member for Melbourne (Mr. Calwell) is correct in saying the Customs Tariff Amendment (No. 1) resulted from the United Kingdom-Australia Trade Agreement made early this year, but 1 do not think he is correct in suggesting that the reduction of duties on the items included in the proposal involves a threat to Australian manufacturers, because, as I hope is widely known, the principal object of the United Kingdom-Australia Trade Agreement, as far as we were concerned, was to remove certain anomalies in our contractual arrangements, as they then existed, with the United Kingdom, which resulted in disadvantage to the Australian economy as a whole. The advantages from the United Kingdom agreement accrue to manufacturers as well as to anybody else in Australia. Indeed, the Australian manufacturer is dependent on a wide range of imported goods for carrying on his business. Under this trade agreement he will be able to obtain these goods, when imported from the United Kingdom, at a lower price than that at which he was able to obtain them before. The tariff proposal now before the committee is the first of a series of ten proposals which honorable members will be asked to consider. Honorable members will recall that I introduced the proposals at various times during this year, five on 22nd May, two on 3rd September, and three on 17th October. I spoke on the proposals at the time of their introduction but it may be helpful, Mr. Chairman, if I reiterate briefly the reasons which prompted the amendments.

Customs Tariff Proposal No. 1 gives effect to the Government’s decision to reduce to 7i per cent, ad valorem, preference margins accorded the United Kingdom over a wide range of items in the Australian Customs Tariff. This action, as honorable members may remember, was consequent on the signing of the United Kingdom-Australia Trade Agreement early this year. Customs Tariff Proposals Nos. 2, 3 and 4 which were also introduced on 22nd May, in the main, provide for tariff variations consequent upon recommendations made by the Tariff Board. Under these proposals, goods in respect of which increased duties are provided include, furnishing and upholstery fabrics, substitutes for cotton canvas and duck, denims and jeans and drills of types ordinarily used in the manufacture of men’s and boys’ outerwear, cotton twill sheeting, felt polishing bobs, industrial machine driving chains with pitches from 1.65 inches to 6 inches, taximeters, and motor vehicle type voltage regulators. Reduced duties are proposed on certain items, the more important of which are circular type hosiery for women and girls, purse frames, and base metal buckles, clasps and slides. The remaining May proposal is Customs Tariff (New Zealand Preference) Proposal No. 1. This proposal is complementary to Customs Tariff Proposal No. 2 in relation to furnishing and upholstery fabrics.

The two proposals of 3rd September, 1957 - that is Customs Tariff Proposal No. 5 and Excise Tariff Proposal No. 1 - provide for duties of 6d. a gallon on aviation turbine kerosene and ls. a gallon on automotive diesel fuel used in road vehicles. These revenue duties form part of the 1957-58 Budget and give effect to the Government’s decisions that airline companies using aviation kerosene should contribute further to the heavy costs of providing airports and air route facilities and that operators of diesel-driven road vehciles should make a reasonable contribution to the cost of building and maintaining roads.

I now turn to Customs Tariff Proposal No. 6 which was tabled on 17th October, last. The proposed amendments, in the main, are based on recommendations made by the Tariff Board. Tariff protection has been provided for various metal-working grinding machines, a range of chemicals mainly of the insecticidal and weed-killing types, slide fastener tape and cycle saddles. The proposal also makes provision for the reduction in the British preferential margin on certain machine tools from 124 per cent, to 7i per cent. This action is supplementary to that taken in Customs Tariff Proposal No. I.

Customs Tariff Proposal No. 6 also varies the duties applying to imported natural and synthetic rubber and rubber latex. The duty under the customs tariff on these products has been increased from 2d. per lb. to 4d. per lb. but primage duty of 10 per cent, ad valorem has been removed, the overall effect being a reduction in the import duty payable. Prior to the introduction of Customs Tariff Proposal No. 6, rubber and rubber latex the produce of the Territory of Papua and New Guinea were dutiable at 2d. per lb. under the British preferential tariff. To avoid an increase to 4d. per lb. in terms of Customs Tariff Proposal No. 6, Customs Tariff (Papua and New Guinea Preference)

Proposal No. 1 was introduced to maintain a rate of 2d. per lb. on Territory rubber and rubber latex.

The last of the proposals which the Committee will be asked to consider is Customs Tariff (New Zealand Preference) Proposal No. 2. This proposal is complementary to Customs Tariff Proposal No. 6 as regards agricultural insecticides. Should honorable members desire further information on any particular item, I will endeavour to let them have that information during the course of the debate. I propose, Mr. Chairman, during the debate, to move amendments to four items. I will explain the reasons for each amendment when the respective motion is placed before this committee. I commend the tariff proposals to honorable members.

Question resolved in the affirmative.

Customs Tariff Amendment (No. 2)

In Committee of Ways and Means: Consideration resumed from 22nd May (vide page 1830), on motion by Mr. Osborne -

  1. That the Schedule to the Customs Tariff 1933-1956 be amended as set out in the Schedule to these Proposals . . . (vide page 1827).

Items in the Schedule - by leave - taken together.

Mr CALWELL:
Melbourne

.- In dealing with Tariff Proposal No. 1 the Minister for Air (Mr. Osborne) dealt with the whole of the proposals. My remarks earlier were confined to the matters covered by Tariff Proposal No. I. It is true, as the Minister has said, that Customs Tariff Amendment (No. 2) proposes certain increases in tariffs on various items. It is a good thing that these increases should be effected. I would like to see the Government take notice of the Tariff Board’s recommendation every time it submits its report. Sometimes the Government receives a report and does nothing about it or sends it back to the board and asks for another report. I know that, in the final analysis, the Government must be responsible for policy decisions. It does not let the Army make decisions, even, for instance, in the matter of building the St. Mary’s filling factory. Neither will it allow the banks to make a decision on banking policy, and it will not allow the Tariff Board the sole right to determine fiscal policy. The Government must always make the decision.

However, there is some discontent when Tariff Board reports are submitted and no action is taken. I am not saying that that has happened in connexion with these particular items, because the Government has accepted the recommendations of the board that certain duties be increased. I hope that the industries in Australia affected will benefit from those increased duties. Apart from those remarks, I have nothing more to say.

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That the following be added to item 404: - “ And on and after 7th November, 1957 404. Samples which, in the opinion of the Minister, are of negligible value, as prescribed by Departmental By-laws Free Free Free “.

The purpose of this amendment is to extend the scope of the item to permit dutyfree admission of samples of negligible value to be used as prototypes by Australian manufacturers or for such other uses as may be prescribed. As the item now stands, it applies only to samples of negligible value which are to be used for promoting orders for goods produced by overseas manufacturers. The Government feels that it is reasonable to accord the same treatment to samples which are required by Australian manufacturers for copying purposes or for other prescribed uses.

Amendment agreed to.

Items, as amended, agreed to.

Preliminary paragraph.

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That preliminary paragraph No. 1 be omitted and the following paragraph be inserted in place thereof: - “ 1. That the Schedule to the Customs Tariff 1933-1956 be amended as set out in the Schedule to these Proposals, and that on and after the twenty-third day of May, One thousand nine hundred and fifty-seven, or such later date as may be specified in the Schedule to these Proposals, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1956 as so amended.”.

This is merely a formal amendment to provide for a date of operation later than 23rd May, 1957, of the new provisions of Item 404 which have just been approved by the committee.

Amendment agreed to.

Preliminary paragraph, as amended, agreed to.

Original question resolved in the affirmative.

Customs Tariff Amendment (No. 3)

In Committee of Ways and Means: Consideration resumed from 22nd May (vide page 1831), on motion by Mr. Osborne -

  1. That the Schedule to the Customs Tariff 1933-1956 be amended as set out in the Schedule to these Proposals . . . (vide page 1831).

Motion - by leave - taken as a whole.

Mr CALWELL:
Melbourne

.- I take it that the matter of electrical machinery appliances, and other machinery covered by this Schedule, from the United Kingdom and elsewhere, are the subject of increased duties?

Mr Osborne:

– Yes, these duties are increased by 10 per cent.

Mr CALWELL:

– The goods are electrical machines and appliances?

Mr Osborne:

– Yes.

Mr CALWELL:

– I am not forcing the issue, but I should like some information from the Minister on that point.

Mr OSBORNE:
Minister for Air · Evans · LP

– The only substantial alterations to the rates of duty were increases in duty. They cover all matters such as speed controls on sewing machines and voltage regulators. The other changes covered by this proposal are drafting amendments.

Question resolved in the affirmative.

Customs Tariff Amendment (No. 4)

In Committee of Ways and Means: Consideration resumed from 22nd May (vide page 1832) on motion by Mr. Osborne -

  1. That the Schedule to the Customs Tariff 1933-1956 be amended as set out in the Schedule to these Proposals . . . (vide page 1832).

Motion - by leave - taken as a whole, and agreed to.

Customs Tariff (New Zealand Preference) Amendment (No. 1)

In Committee of Ways and Means: Consideration resumed from 22nd May (vide page 1832) on motion by Mr. Osborne -

That the Schedule to the Customs Tariff (New Zealand Preference) 1933-1954 be amended as set out in the Schedule to these Proposals . . . (vide page 1832).

Motion - by leave - taken as a whole.

The CHAIRMAN:

– The question is, that the motion be agreed to.

Mr Ward:

– I direct your attention, Mr. Chairman, to the state of the committee. You cannot declare that tariff proposals are agreed to when so few honorable members are present.

The CHAIRMAN:

– Ring the bells. (Quorum formed.)

Question resolved in the affirmative.

Customs Tariff Amendment (No. 5).

In Committee of Ways and Means: Consideration resumed from 3rd September (vide page 256), on motion by Mr. Osborne -

That the Schedule to the Customs Tariff 1933- 1956, as proposed to be amended by Customs Tariff Proposals . . . (vide page 254).

Item 229-

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That the following be added to sub-paragraph (b) of paragraph (6) of sub-item (b) of Item 229: - “And on and after 7th November, 1957

The reason for this amendment stems from the fact that when Item 229 (b) (6) (b) was introduced on 3rd September, 1957, it was thought that there would be a need to make provision for by-law admission at rates of 4d. per gallon, British preferential tariff, and 4½d. per gallon intermediate and general tariffs for solar oil when for use otherwise than as automotive diesel fuel. Experience has shown that whilst the by-law provisions can be operated administratively to accord the present rates of duty to solar oil not elsewhere included, it is more desirable to make positive provisions in the tariff to that end. The amendment I have just moved ensures that solar oil not elsewhere included will not be dutiable at rates higher than those existing immediately prior to 3rd September, 1957.

Mr CALWELL:
Melbourne

.- I ask your indulgence, Mr. Chairman, while I make some suggestions to the Minister in connexion with the presentation of these documents to the committee for its consideration. Our procedures are very involved. We ought to have a simpler method of dealing with these matters. The officers of the department do a splendid job in preparing and distributing a tremendous amount of information, but it needs to be reduced to manageable proportions. It is not easy to- follow the course of a debate such as this, with so many papers in one’s possession. I greatly appreciate what the officers do to help the Opposition in these deliberations, and we do not want to be obstructive in any way, but I suggest that somehow, at some time, the method of presentation of these proposals needs to be considered, and improved for the benefit of all honorable members.

Mr OSBORNE:
Minister for Air · Evans · LP

– I quite agree with the Deputy Leader of the Opposition that the matter is extremely involved, and I shall gladly take up with the Minister for Customs and Excise (Senator Henty) his suggestion that consideration be given to seeing whether the method of presenting these proposals can be simplified.

Amendment agreed to.

Item, as amended, agreed to.

Preliminary paragraph.

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That the preliminary paragraph be omitted and the following paragraph be inserted in place thereof: - “ That the Schedule to the Customs Tariff 1933- 1956, as proposed to be amended by Customs Tariff Proposals introduced into the House of Representatives on the twenty-second day of May, One thousand nine hundred and fifty-seven, be further amended as set out in the Schedule to these Proposals, and that on and after the fourth day of September, One thousand nine hundred and fifty-seven, or such later date as may be specified in the Schedule to these Proposals, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1956 as so amended.”.

This is merely a formal amendment to provide for a date of operation later than 4th

September, 1957, of the new provisions of Item 229 (b)(6)(b) which have just been approved by the committee.

Amendment agreed to.

Preliminary paragraph, as amended, agreed to.

Original question resolved in the affirmative.

Excise Tariff Amendment (No. 1).

In Committee of Ways and Means: Consideration resumed from 3rd September (vide page 256), on motion by Mr. Osborne -

That the Schedule to the Excise Tariff 1921-1956 be amended as set out in the Schedule to these Proposals . . . (vide page 255).

Motion - by leave - taken as a whole.

Mr CALWELL:
Melbourne

.- On this item, the Opposition has very decided views. On 3rd September the Minister for Air (Mr. Osborne) tabled tariff proposals relating, among other things, to aviation turbine kerosene and diesel fuel. On that occasion I asked the Minister whether he could secure information as to the effect of this imposition on the various Australian airline companies. He promised to secure for me what information he could and the Minister for Customs and Excise, (Senator Henty) sent me a letter in which he said that the Minister for Air had forwarded my request to him. The Minister for Customs and Excise stated in his letter - . . an estimated quantity of 14,289,000 gallons of aviation kerosene, on which approximately £387,000 duty will be payable, will be used by aircraft in Australia during this financial year.

He then gave me the division of the gallonage and the duty between international airlines and local airlines. But he added -

I regret that I am unable to supply details ot the individual quantities used by individual airline companies as such would disclose information supplied to my department confidentially at the time of payment of duties for the clearance of the goods.

I feel, and the Opposition feels, that the Parliament should be given the fullest information on a subject of this sort. How can it possibly affect competition between the airline companies if we know how much the A.N.A.-Ansett merger is to pay and how much Trans-Australia Airlines is to pay? We are vitally concerned about this matter. The figures given by the Minister concerning the amount of aviation kerosene that would be used by international airlines and Australian airlines and the duty that would be paid are as follows: -

It is well known that aviation kerosene is used by Viscount aircraft and that Viscounts are the aeroplanes used by T.A.A. Therefore, T.A.A. will pay the greatest portion of this duty of £362,000. Only those airline companies that fly Viscounts will use aviation kerosene, so I am advised. Therefore, the A.N.A.-Ansett company will pay very little of this duty. We suspect that the Government is imposing this new rate of duty, for the first time in the history of this Parliament, because it wants to handicap T.A.A. in its competition with the A.N.A.Ansett company. We think that it is a move to weaken the government-owned airline. A government that raises £1,300,000,000 in revenue in a year has no need of this extra £362,000 of duty to be taken from its own airline.

We suspect that the greatest proportion of the duty will be paid by T.A.A. We want to know why the Minister for Customs and Excise cannot let us have the figures for which we have asked. I am sure that T.A.A. would not object to Parliament knowing how much duty it pays. As a matter of fact, it probably will indicate in its next report to the Parliament how much it has paid. It will then only be a matter of subtraction to find out how much of the £362,000 has been paid by the other airline companies. We are not happy about the position.

Neither are we happy about some aspects of the proposal to tax diesel fuel. It is right that diesel fuel should be taxed. If the ordinary motorist who uses petrol to drive his car has to pay a heavy duty, then those who use diesel fuel for locomotive purposes should also have to pay. But the Government is doing the whole job of taxing diesel fuel rather crudely. It is making everybody who uses diesel fuel pay the tax and providing rebates to people who use such equipment as excavators, road graders, bulldozers, power shovels, earthmoving equipment, agricultural tractors and forklift trucks. The users of that type of mechanical equipment, in effect, can be exempted from the payment of duty under departmental by-laws, but if they have had to pay the duty they can obtain a rebate by applying to the Department of Customs and Excise. The Opposition would like to know a little more about this matter. We think it is a good thing that the users of the equipment that I mentioned should not have to pay this duty because they are not using the roads to the same extent as road vehicles which are used to carry passengers and goods from place to place.

Before the debate has concluded, perhaps the Minister for Air will indicate more of the reasons why the new aviation turbine kerosene tax has been imposed and perhaps he will assure the committee and the country that it is intended as a revenue producer, and is not designed to harm T.A.A. and its activities in any way. The Minister will find it difficult to convince most people of that, but I think that he is bound to give assurances to the Parliament and the nation that the Government will not use this tax for the purpose of harming its own instrumentality.

Mr OSBORNE:
Minister for Air · Evans · LP

– I shall deal shortly with the three points raised by the honorable member for Melbourne (Mr. Calwell). First, I reject completely the suggestion that the duty of 63-d. a gallon on aviation kerosene is part of a plot aimed at Trans-Australia Airlines. That allegation is entirely without foundation. At present, every aviation company that uses aircraft that are driven by petrol engines pays a high rate of duty. Either they pay customs duty on imported aviation spirit or they pay excise duty on locally refined aviation spirit at the rate of 10½d. or 8id. a gallon, respectively. The use of kerosene as an aviation fuel is comparatively new and, up to the introduction of this duty, kerosene used in aircraft was entirely free of duty. So instead of this being a plot aimed at T.A.A., the reverse is the case. This is a measure to bring into line one kind of aviation fuel with another.

The suggestion of the Deputy Leader of the Opposition that T.A.A. is the only company using kerosene as an aviation fuel is incorrect. Other privately owned airlines in Australia operate Viscount aircraft and use kerosene as fuel. As time goes on, it is to be expected that other aircraft with turbo-prop engines and jet engines will be introduced to Australian airlines. The right time to remove an anomaly of the kind that is removed by this duty is before these aircraft come into wide use, not after they are in general use.

The Deputy Leader of the Opposition suggested that the Minister for Customs and Excise (Senator Henty) was incorrect in declining to give the honorable gentleman information of the amount of duty paid on aviation fuel by different companies. It is a long-established rule of the Department of Customs and Excise that no information showing the extent of an individual’s business, furnished confidentially to the department, can be supplied in answer to a request. I am sure that on reflection the honorable gentleman would agree that that rule is sound and should be observed. As he himself has pointed out, he can draw reasonable conclusions from the facts as to the amount of duty likely to be paid. I strongly support the action of the Minister for Customs and Excise in declining to give the information sought.

The Deputy Leader of the Opposition suggested that there should be an investigation of the method of collecting the new duty on diesel fuel used on roads. I think the honorable gentleman suggested that it was clumsy for the duty to be collected in the first instance and then refunded to all persons not using diesel fuel for road transport. It would be quite impracticable, with the enormous number of people involved, to make arrangements for them to draw diesel fuel duty-free in the first instance. The only practicable way of collecting this duty is to charge the duty on the fuel as it is released, and then give a rebate to the person who is entitled under the law to use that fuel duty-free.

The CHAIRMAN:

– I understand that will be the subject of a later bill.

Mr Osborne:

– Yes.

Mr WARD:
East Sydney

.- I join issue with the Minister for Air (Mr. Osborne), and support the allegation of my colleague, the Deputy Leader of the Opposition (Mr. Calwell), that this new duty on aviation kerosene has been deliberately imposed at this stage in order to place a further handicap on Trans-Australia Airlines, the Government airline. The Minister seems to think that now is an appropriate time to remove what he regards as an anomaly. Why does not the Minister be honest with honorable members and state how much of the £380,000 is to be exacted from T.A.A., and how much from other operators who use kerosene fuel? The sum. of £380,000 may not mean much to a government, but it could be a serious consideration for an airline company. T.A.A. showed a great deal of initiative when it introduced Viscount aircraft into this country. The aircraft has proved a great success, and the Government now wants to place a penalty on the success- of this government undertaking by imposing an impost on aviation kerosene. T.A.A. , instead of being discouraged, should be encouraged by the Government, lt is a government undertaking, and if the Minister regards the present practice as anomalous, in my opinion he has chosen the most inappropriate time to correct the anomaly, because the amount of money that the Government will obtain from this tax is not very much at all - £380,000. I know that the Opposition can do nothing about it now, because the Government has the numbers. Although the Government has disposed of a large number of undertakings, T.A.A. has been one that it has had difficulty in disposing of owing to its great success. T.A.A. has won the support of the Australian public, but the imposition of this duty is one way of undermining and sabotaging T.A.A. Whenever the Government has a chance to retard the progress of this great airline, it does so. However, despite the Government’s efforts to sabotage it, T.A.A. is going from success to success, which proves conclusively that as long as there are people in control of a government undertaking who are not sabotaging that undertaking, or have not been bribed and corrupted by the people who want to destroy government enterprise in this country, government enterprise will always prove superior to private enterprise where the conditions under which they operate are comparatively equal. This Government must be branded as the protagonist of private enterprise. It is opposed to every community effort.

I support my colleague, the Deputy Leader of the Opposition, and I say that the Minister has not satisfactorily answered the charge laid by my colleague. It is my firm opinion, and I feel sure the opinion of every member of the Opposition, that this Government is determined to destroy T.A.A. The Government will first of all sabotage T.A.A., hoping to weaken it as an organization and destroy its appeal to the general public. Then, when it believes that it has undermined T.A.A. sufficiently, the Government will sell the company to wealthy commercial interests, as it has sold many other government undertakings in the past.

Mr ANDERSON:
Hume

.- I did not propose to speak, but I cannot allow the honorable member for East Sydney (Mr. Ward) to get away with what he said. The honorable member’s remarks are completely childish. I am surprised that the Deputy Leader of the Opposition (Mr. Calwell) was associated with those remarks. If the tax is not paid, Trans-Australia Airlines will make higher profits. It matters not how the Government obtains the revenue, whether as a tax on kerosene or as profits earned by T.A.A. The revenue goes into the same coffers. At the same time, competition will be fairer under the Government’s proposal because at present the airline operators using petrol-driven engines are at a disadvantage compared with operators using kerosene. If one analyses the speech of the honorable member for East Sydney, it is evident that he was just wasting the committee’s time.

Question resolved in the affirmative.

Customs Tariff Amendment (No. 6).

In Committee of Ways and Means: Consideration resumed from 17th October (vide page 1509), on motion by Mr. Osborne -

That the Schedule to the Customs Tariff 1933-1956, as proposed to be amended by Customs Tariff Proposals . . . (vide page 1504).

Items in the Schedule - by leave - taken together.

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That the following be added to sub-item (a) of Item 331:- “And on and after 7th November, 1957

Rubber (including synthetic rubber and rubber substitutes), being crude’, masticated, powdered or reclaimed rubber or being rubber waste -

The amendment I have just moved writes into Item 331 (a) specific provision for synthetic rubber and rubber substitutes when in the forms set out in that item. No practical change in the interpretation of the item is involved, the amendment being designed solely to make it abundantly clear that such synthetics and substitutes are dutiable at the same rates as natural rubber.

Amendment agreed to.

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That the following be added to sub-item (d) of Item 331: - “ And on and after 7th November, 1957

Rubber latex (including synthetic rubber latex) -

This amendment is similar to the one which has just been considered by the committee and makes provision in Item 331 (d) for both natural and synthetic rubber latices. No change in interpretation of the item is involved.

Amendment agreed to.

Item, as amended, agreed to.

Preliminary paragraph.

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That preliminary Paragraph No. 1 be omitted and the following paragraph be inserted in place thereof: - “ That the Schedule to the Customs Tariff 1933- 1956, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals, and that on and after the eighteenth day of October, One thousand nine hundred and fifty-seven, or such later date as may be specified in the Schedule to these Proposals, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1956 as so amended.”.

This is merely a formal amendment to provide for a date of operation later than 18th October, 1957, of the new provisions of Items 331 (a) and 331 (d) which have just been approved by the committee.

Amendment agreed to.

Preliminary paragraph, as amended, agreed to.

Original question resolved in the affirmative.

Customs Tariff (Papua and New Guinea Preference) Amendment (No. 1).

In Committee of Ways and Means: Consideration resumed from 17th October (vide page 1509), on motion by Mr. Osborne -

That the Schedule to the Customs Tariff (Papua and New Guinea Preference) 1936-1956 be amended . . . (vide page 1508).

Motion - by leave - taken as a whole.

Mr CALWELL:
Melbourne

.- These tariff proposals, I understand, are to increase the duty upon rubber imported from Papua and New Guinea. I have heard no protests from any of the rubber-growers in this Territory of the Commonwealth, and I suppose they accept the Government’s decision. I would just like to make one or two remarks on the question of rubber growing in Papua and New Guinea. It would be a good thing for the Commonwealth, and for the Territory, if the growing of rubber there were encouraged to the greatest extent possible. It would be far better for us to be importing our rubber from the Territory than from Malaya. I assume that, whatever is being done under these tariff proposals, it will not militate against rubber growing in Papua and New Guinea, but will help it.

Mr Osborne:

– The proposal is to maintain the rate on rubber grown in Papua and New Guinea at the previous level, not to allow it to increase with the other rates. It preserves the status quo.

Mr CALWELL:

– I am grateful to the Minister for that information. That is a good thing for Papua and New Guinea, and for Australia, too. I have been in the Territory on a couple of occasions and I have seen the great rubber plantations there. I hope that they will figure even more importantly in the economic life of the Territory and in the economy of Australia in the years ahead.

Question resolved in the affirmative.

Customs Tariff (New Zealand Preference) Amendment (No. 2).

In Committee of Ways and Means: Consideration resumed from 17th October (vide page 1507), on motion by Mr. Osborne -

That the Schedule to the Customs Tariff (New Zealand Preference) 1933-1954, as proposed. . . (vide page 1507).

Motion - by leave - taken as a whole, and agreed to.

Resolutions reported.

Standing Orders suspended; resolutions adopted.

Ordered -

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

page 1880

CUSTOMS TARIFF BILL 1957

Bill presented by Mr. Osborne, and read a first time.

Second Reading

Mr OSBORNE:
Minister for Air · Evans · LP

– I move -

That the bill be now read a second time.

In view of the fact that the subject-matter has already been fully debated, I do not propose to make a second-reading speech.

Mr CALWELL:
Melbourne

.- For the same excellent reason as that advanced by the Minister, I propose to take the same course.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 1880

CUSTOMS TARIFF BILL (No. 2) 1957

Bill presented by Mr. Osborne, and passed through all stages without amendment or debate.

page 1880

CUSTOMS TARIFF (NEW ZEALAND PREFERENCE) BILL 1957

Bill presented by Mr. Osborne, and passed through all stages without amendment or debate.

page 1880

CUSTOMS TARIFF BILL (No. 3) 1957

Bill presented by Mr. Osborne, and passed through all stages without amendment or debate.

page 1880

EXCISE TARIFF BILL 1957

Bill presented by Mr. Osborne, and passed through all stages without amendment or debate.

page 1880

CUSTOMS TARIFF BILL (No. 4) 1957

Bill presented by Mr. Osborne, and passed through all stages without amendment or debate.

page 1881

CUSTOMS TARIFF (PAPUA AND NEW GUINEA PREFERENCE) BELL 1957

Bill presented by Mr. Osborne, and passed through all stages without amendment or debate.

page 1881

CUSTOMS TARIFF (NEW ZEALAND PREFERENCE) BILL (No. 2) 1957

Bill presented by Mr. Osborne, and read a first time.

Second Reading

Motion (by Mr. Osborne) proposed -

That the bill be now read a second time.

Mr CALWELL:
Melbourne

.- I am sure that the Minister for Air (Mr. Osborne) can now see the significance of my point that it has taken eight bills to give effect to these tariff proposals. I know that Moses had some good points in his plan, but I do not see why it should need eight bills to give effect to the Government’s good intentions in regard to the protection of Australian industries and the raising of revenues. I should like the Minister’s assurance that he will try to streamline the procedure before the next round of bills such as these comes along. I think that a more streamlined procedure would help the Parliament.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 1881

INCOME TAX AND SOCIAL SERVICES CONTRIBUTION ASSESSMENT BELL 1957

Second Reading

Debate resumed from 5th November (vide page 1811), on motion by Sir Arthur Fadden -

That the bill be now read a second time.

Mr CREAN:
Melbourne Ports

.- I think that, in the consideration of this bill, it needs to be borne in mind that the Income Tax and Social Services Contribution Assessment Act determines the principles and subjects of a tax that returns to the Government £675,000,000 a year- £465,000,000 of which is paid by individuals and £210,000,000 of which is paid by companies. Under the terms of the principal act, the Government raises 58 per cent, of its revenue, and takes from the pockets of the Australian people more than one-eighth of the gross national product. Therefore, what is or is not subject to this very important tax is of significance to the whole economic life of the Australian community.

The amendments for which provision is made in the bill were outlined in some detail by the Treasurer (Sir Arthur Fadden) in the explanatory memorandum that he circulated when the measure was introduced. He listed eight separate matters that are to be altered or varied. The definition of “ child “ has been widened to include adopted children, ex-nuptial children and children generally for whom a taxpayer has assumed all the responsibilities of legal parenthood. I do not think anyone can have any objection to the extension of the ambit of allowable deductions in this direction.

It is proposed also that income derived by a resident of the Island of Nauru from sources within the island shall be free of Australian income tax in the same way as is income of persons who live in other territories. The proposal embraces the income that they will earn in the island but not income that they may continue to derive from Australia.

I should like to say a little more about the next point. I refer to the subject of depreciation and the amounts that are to be allowed off the cost of capital assets to people who are engaged in business. Whether those people be individuals, partnerships, or companies, if in the course of their business they employ certain assets that wear out or which from time to time need to be renewed or replaced, they are allowed certain amounts off the capital cost of those items. The provision for depreciation allowance is one of the few recognitions in the income tax act of the need to make allowance for capital expenditure. For the most part in this country, expenditure of a capital nature is not regarded as being subject to income tax. An exception has been made, however, in regard to assets that waste, deteriorate, or become obsolete, and it is provided that some allowance calculated on the estimated life of the asset shall be allowed as a deduction in computing the assessable income for a particular year.

There are one or two technical points that require some examination. Perhaps they should be the subject of a little logical examination, because it seems rather odd that, strictly in accordance with the terms of the act, the Commissioner of Taxation, in his discretion, should determine the estimated life of a particular piece of plant or article used in a business as being ten years, five years, four years or even fifteen years, and determine that depreciation shall be calculated on the basis of 100 divided by the estimated years of life, and that we should now be told that that amount of depreciation will be increased by 50 per cent. On the surface of it, there is not a great deal of logic in the proposal; it arises largely from the mechanics by which depreciation has been computed in Australia in the past.

Broadly, there are two methods of calculating depreciation, one of which taxpayers may elect to choose. They may elect to calculate their depreciation by the diminishing value method whereby, if the estimated life of the asset is ten years, in the first year they take off 10 per cent, of the initial cost, in the second year 10 per cent, of the residue, in the third year 10 per cent, of the value then remaining, and so on. Alternatively, they may choose the prime cost method whereby, if the life of the asset is ten years, they depreciate its value by one-tenth each year. It is rather peculiar that, despite the fact that over a period of years the prime cost method depreciates the asset more quickly, the majority of taxpayers choose the reducing balance method. It is found that, at the end of two-thirds of the life of most plant, when it is suggested that thought should be given to replacing it, there are quite significant differences in the value of that plant when determined by the diminishing balance method as against the flat depreciation, method.

It is now proposed that, in order to bring the value of the asset when depreciated by the diminishing balance method into accord with its value when depreciated by the other method, that is, at the expiration of twothirds of its estimated life, the ratio that has been determined as depreciation shall be increased by 50 per cent. There is not a great deal of logic in the proposal when it is put in a pure mathematical form. It seems to me that a better thing to have done would have been for the Commissioner of Taxation to erect a new schedule of rates. The effect of the proposal now before us is to allow, under the diminishing value method, greater amounts by way of depreciation in the earlier years of the life of plant than is now the case.

The proposed amendment to the legislation goes further and covers the disposal, loss or destruction of plant. The act already contains provision to cover the loss or destruction of depreciable assets as a result of fire, war or something of that kind. That provision has been written into the law since 1942. Briefly, the position is this: If any asset that has been subject to depreciation is lost or destroyed, if a payment is made to cover that loss or destruction, and if that payment is in excess of the written down value of the plant, the amount of that excess is written back into the taxable income of the taxpayer for the year in which the amount is recouped. It is suggested that sometimes when that is done an individual who would have used the sum that he had acquired to replace the asset that was destroyed finds himself in difficulty because he has to pay an excessive amount of tax on the amount written back.

The committee that was presided over by the honorable member for Petrie (Mr. Hulme) stated that a number of people appeared before it and said that, as a result of this provision in the act, they had experienced difficulty in replacing assets because the additional tax took away a large part of the sum that was supposed to buy a new asset. I agree with the principle as applied to the loss or destruction of property. That has actually happened. If the person wants to continue in business he has to purchase an alternative asset to enable him to do so. But the amended section would go further than that. Clause 12 seeks to amend section 59 of the principal act, which is the section dealing with depreciation in this particular aspect. Where the present section now refers to property “ lost or destroyed “ the amended section would additionally refer to property “ disposed of “. This seems to me to import an entirely new principle into taxation, because the suggestion is that when a surplus results from the disposal of property instead of being written back into profits, it can be off-set against other assets altogether, those assets, of course, having to be subject to depreciation. The suggestion by the Government is that this does not make any difference in the long run, because if those concerned are eligible for depreciation allowances and do not get them to-day they will get them to-morrow. Of course, that is to fracture the whole basis on which depreciation allowances are at present computed. They are computed, at the moment, on historical costs, taking into account the estimated life of a plant. Merely because you sell for £800 a particular piece of plant which appears in your books at a value of, say, £400 for taxation purposes - perhaps it is scarce plant and somebody else wants it although you do not - and so get a £400 profit, to offset that excess against other assets which are subject to depreciation in the normal way, seems to me to be bestowing a benefit on individuals who happen to be in that fortunate position and, I think, seems to import an altogether new principle into the depreciation allowances system. Of course, if the Government is facing up to the problem this way that is all right, but at least it seems that the thing ought to be recognized for what it really is - a selective allowance given to individuals in particular circumstances. In many ways it seems to cut across accepted principles of allowing depreciation.

Some years ago this subject was very closely examined in Great Britain by a royal commission which produced what was known, I think, as the Millard Tucker report because the chairman of the commission was James Millard Tucker. That commission dealt with taxation on profits and income. I submit that the time is really ripe in Australia for a similar comprehensive examination of the impact on the community not only of income tax but of all taxation. Yesterday we were talking about one tax - the pay-roll tax - which seems to have got away from the purpose for which it was originally instituted. Similarly, income tax, which in its early days yielded only a minor part of the revenues of the Commonwealth, is now a major tax responsible for an average annual yield of about £675,000,000 collected from both individuals and companies. It seem* to me that there is need in this country for a similar systematic examination of the field of taxation and of the deductions allowed in computing assessable income. Depreciation is one such deduction, and was given considerable examination by that British commission. The commission set its face against this kind of discriminatory allowance based on the principle that what you ought to write back in one year by reason of profit, because it would abate the amount of tax, could be written off other assets. That does not seem to be a very systematic way of doing things. After all, we allow depreciation for at least two reasons. One is that as assets do normally wear out and ought to be replaced, a fund must be set up for their replacement. But when the amounts that have been received for the sale of one kind of property, and have been returned to profit, are applied to depreciate entirely different property, it seems to me that you have departed very far from the initial principle. That sort of thing may not be for the best so far as the pattern of future investment in this country is concerned.

Depreciation is quite a significant item - again citing that important document, the thirty-fifth report of the Commissioner of Taxation, which gives a statement of the depreciable assets and trading stock of certain trading enterprises, companies resident and non-resident and according to whether they are private or non-private, in the year ended June, 1954. Thirteen thousand of these companies had subject to depreciation assets which, at the beginning of the year, had a value of nearly £64,000,000. During the year an additional £22,000,000 worth of assets was purchased, and during the same year £5,000,000 worth of plant was disposed of and £8,500,000 was allowed as depreciation in respect of the plant of these 13,000 companies. That is not the whole depreciation, but at least it gives some indication of how important is the matter that we are now considering.

It is very doubtful now whether the methods adopted in this House in 1957 for evaluating highly technical amendments to tax legislation are the most systematic way of securing amendments to the tax law of this country. It is true that on this occasion, so far as depreciation is concerned, we have had the benefit of a report by a committee, and that the legislation largely follows the views of that committee, but with all respect to the committee’s chairman, who is a very good friend of mine. I know that his approach to these matters might be coloured by a political philosophy different from mine. To my mind, the committee would have been a better committee had it been a joint committee of this

House, hearing evidence from experts on the matter. There is need for a greater variety of joint committees of this House than we already have, to deal with matters on which we could get some agreement. I know that there are one or two fields in which agreement would be politically difficult, but I suggest that at least on the question of examining the field of taxation and determining provisions for allowances to be made, there is some hope of getting agreement, and of getting out of a system of that kind a value which is not attained always by passing legislation in the way we do it here. This bill, which was brought into this House only yesterday and is being debated to-day, consists of 23 clauses covering nine full printed pages. Many of the matters with which it deals are complicated. It is true that it can be said that we have had notice for quite a long time of some of the things intended, but I suggest that bills of this kind ought to be brought into the House six months before their fate is to be finally determined by the House. This would at least give an opportunity for all political parties and all other interested groups in the community to bring their specialized knowledge to bear on an examination of what is contemplated in the legislation. With due respect for the calibre of honorable members on both sides of the chamber, I doubt whether such legislation can be properly considered in less than 24 hours. This does not seem to me to be the right way in which to approach the matter. I commend, to the Treasurer the example of his colleagues in the United Kingdom. In the next twelve months - it would have to be done fairly quickly - he should appoint a committee to examine taxes generally and, in particular, the deductions that may be allowed in computing assessable income. I repeat, my colleagues and I feel that, to say the least, a dubious principle is imported into the calculation of depreciation if you allow the surplus on one asset, which ought to be treated as profits in a particular year, to be offset against entirely different assets - without any relation to the estimated life of those assets. The principle seems to call for much more examination than it has received.

Other amendments give the individual the right to change from the prime cost method to the diminishing value method in computing depreciation. When a new system is introduced every taxpayer should be able to choose the method by which the depreciation of his assets shall be calculated.

Next, the Treasurer increases the number of worthy institutions, donations to which shall be classed as deductions from assessable income for tax purposes. They include the National Trust of Australia (New South Wales), the National Trust of Australia (Victoria) and the National Trust of South Australia. They also include public libraries, and as a trustee of the Victorian Public Library I welcome the change. Many people wish to make endowments to institutions other than universities. Often they wish to give to public libraries, which serve all members of the community, rather than a certain section of the people only, which sometimes happens with universities. The concession is to be extended to public museums, public art galleries and so on. Most of such institutions are Stateowned and are usually short of funds. They will welcome the opportunity to have their finances strengthened by donations from other sources. Others mentioned are the Sydney Opera House Appeal Fund, the Sidney Myer Music Bowl Trust and the Industrial Design Council of Australia. I am not sure what the last-named body does, but it must be influential to warrant inclusion in this favoured list of institutions.

Next, the Treasurer has increased the allowances which taxpayers may claim for a spouse, daughter-housekeeper, student child, invalid relative and children under sixteen years of age. Also, the concession is now to be extended to the parent-in-law of the taxpayer. I am very pleased that this has been done because, two years ago, I pointed out in this chamber that it was anomalous that a claim could be made in respect of the parents of the breadwinner only. I added that it was largely a matter of chance as to whether the parents of the breadwinner, or of his spouse, were supported. Indeed, there is a greater tendency for elderly mothers to live with their daughters than with their sons. Now the parent of either the taxpayer or his spouse, if wholly maintained, will be regarded as a person in respect of whom a claim for a concessional deduction may be made. And as most of us know, all mothers-in-law are not really bad.

We feel that the allowance for the wife does not go far enough, and at the committee stage will move that it be increased from £143 to £156. There is not much logic in fixing the amount at £143. If any one thinks that his wife can be supported for £2 15s. a week he is entitled to his opinion, but it is not borne out by the experience of most married people. Nor do we feel that even £156 is adequate. I suggest - and this is a matter that should be considered by the kind of commission that I have already mentioned - that the whole tax structure should be reviewed so as to permit greater statutory exemptions and greater allowances for dependants. When these more adequate allowances have been made, the new rate structure should then be erected on the surplus available for taxing. There is a good case for not taxing a married man until his total income exceeds the basic wage. That would, of course, require fundamental alterations of the tax structure. It would probably mean the imposition of a much higher rate of tax on the remainder, but at least it would do justice to those in the community who have the greatest family commitments. That should be achieved, by the creation of an enlightened tax structure, in our own generation. We propose that the round sum of £3 a week be allowed in respect of the wife of the taxpayer, although we do not believe that even this sum is adequate in terms of present living costs. My colleague from the Australian Capital Territory (Mr. J. R. Fraser) referred to it as a kind of depreciation allowance for the wife, but I do not know whether it is quite in that mould.

Those are the principal matters covered in the legislation before us. The Government, in granting benefits to those who are in business, should equally have granted benefits to other sections of the community. The question whether fares paid in travelling to and from work should be an allowable tax deduction has recently been discussed quite freely. The objection usually taken is that almost every one incurs expenditure of this kind and that, if it were recognized as deductible for income tax purposes, the Government would simply have to collect more tax from the remainder of the people and, in consequence, no one would really be better off. That might have been the original reason for rejecting the claim, but it ignores a very important consideration in our capital cities, which have expanded so greatly that there are wide disparities between the amounts of fares paid by individuals living in different parts of the metropolitan areas. If I want to go into the city, I can catch a tram right at my doorstep which takes me to the heart of the city for a fare of 9d. I had occasion recently to make a train journey to Frankston and was astonished to find that the daily fare from the city to Frankston was 6s. return. If two individuals are receiving the same weekly wage and one has to pay a daily fare of ls. 6d. and the other a daily fare of 6s., there is a considerable difference in the standards of living of those two people. I think there is a need to recognize such disparities.

It must always be borne in mind in computing the value of these allowances that’ a deduction of £50 from taxable income is nowhere the same as an extra £50 in one’s pocket. The value of an allowance of £50 is only fifty times the tax payable on £1 of the taxable income. Nevertheless if fares over a certain amount were allowed as a deduction for income tax purposes, that concession would, help to redress the balance between sections of the community. Of course, it would be necessary to have some method of establishing the bona fides of claims for travelling expenses. Industry for the most part has crowded into the inner parts of the cities, but people who desire to obtain residences have to go further and further from the centres of the cities. Consequently, the expense of travelling to and from their work is high. Some recognition of that fact should be made in the income tax legislation. Any sensible taxation system should recognize that there are differences of the kind I have described and, insofar as some adjustment can be achieved by the taxation concessions, consideration should be given to such concessions. It seems that business interests, because their lobbying forces are more compact and more influential, are able to get their way more easily than can the ordinary person in the community.

It is said that individuals who drive to and from work in their own cars sometimes claim running expenses as a tax deduction, but if the Commissioner of Taxation is able to prove that those expenses are in fact incurred in travelling to and from work. the claims are not allowed. It is difficult, of course, when the expense of running a car for business purposes is allowable as a tax deduction, to separate expenses incurred on business activities from those incurred on private activities. The same kind of problem arises with what are known as expense allowances, sometimes described as swindle sheets. If a businessman takes a client to lunch, he can claim the cost of the lunch as a deduction for income tax purposes, but if he takes a friend to lunch, that is regarded as domestic expenditure, so to speak. Of course, anomalies will always exist, but an attempt ought to be made to remedy those that can be remedied.

I repeat that during the committee stage the Opposition will move an amendment proposing that the allowance for the spouse of a taxpayer, and also for a daughterhousekeeper, parent or parent-in-law, be increased from £143 to £156. I also suggest that the House should mark the introduction into depreciation allowances of what I call the dubious principle of transferring a surplus on one asset to another, so that it attracts a depreciation allowance. We should recognize that principle for what it is. Apart from these matters, the Opposition has no objection to this measure. The majority of the proposed amendments of the act are desirable, some being only of a machinery nature, but the Opposition felt that the matters we have raised should be dealt with at this stage.

Mr BRYANT:
Wills

.- It is an astonishing situation when two members of the Opposition have to follow one another in a debate on such an important piece of legislation such as this. The Income Tax and Social Services Contribution Assessment Act is an act of extraordinary complexity, of great length, and of singular importance to the community. This bill, which seeks to amend that act, is not simply a financial measure. It is not a bill which is of interest only to those who study finance. It affects all of us. I am surprised, therefore, that no honorable members from the Government side saw fit to rise when the honorable member for Melbourne Ports (Mr. Crean) finished his speech, but I hope that at a later stage we will hear from some of the people opposite who have expert knowledge in various fields of activity. They may be able to explain some of the difficulties and anomalies that have been mentioned by the honorable member for Melbourne Ports.

Does this measure favour business interests? Does it give full consideration to family interests? Perhaps honorable members opposite who have made a study of depreciation allowances will give us the advantage of their great wisdom and let us know what they think of the Government’s, proposals in that respect.

Mr Chaney:

– Why does not the honorable member give us his own views?

Mr BRYANT:

– I shall do so. I am pleased that the honorable member for Perth is present to listen to what 1 have to say this afternoon. I pay him the tribute of saying that he is usually present. It would be well if other honorable members opposite were to show as much interest as he does in the proceedings. There are very few members present on the Government side of the House, although the Government has almost twice as many members as the Opposition. On this occasion, I think the numbers are just about equal. If we could put the motion now, we might have the numbers in our favour.

Mr Whitlam:

– They would not want to miss their aperitifs.

Mr BRYANT:

– They will get their appearance money. This bill is part of a social document. The Income Tax and Social Services Contribution Assessment Act has 234 pages and contains 266 clauses. Any bill to amend an act such as that is a veryimportant piece of legislation. I still want to know why there was nobody from the Government side to follow the honorable member for Melbourne Ports and to reply to the questions he raised. The income tax legislation is not just a piece of financial legislation. It encourages all sorts of things. The sections providing for zone allowances are designed apparently to encourage people to live in the Northern Territory or Papua and New Guinea. Now, apparently, people are to be encouraged to go to Nauru. Let us hope that the legislation will achieve that result, instead of just paying a little extra tribute to the people who are already living in these places.

Mr Coutts:

– What about Macquarie Island?

Mr BRYANT:

– Macquarie Island and Heard Island are mentioned, so are Papua and New Guinea, Norfolk Island, McDonald Island, the Australian Antarctic Territory and the Cocos (Keeling) Islands. Sections of the income tax legislation are designed to encourage the development of remote areas.

Other sections are designed to encourage the charitable instincts of the community. One has only to turn to sections of the act to see the scope that is offered to people to indulge their charitable instincts, and at the same time to gain a little monetary benefit in the form of rebates of tax. The legislation offers encouragement to invest in gold mining. It offers encouragement to people to have more children, particularly people on higher incomes, as the higher the income, the greater the deduction. These are all parts of the act we want to analyse.

When the Treasurer (Sir Arthur Fadden) brought in this bill, 1 waited to see whether he intended to solve some of the difficulties and remove some of the anomalies that exist in the income tax field. As the honorable member for Melbourne Ports pointed out, the time has come for a general review of the whole taxation structure. Income tax falls upon a particular group of people, the wage and salary earners, who generally are unable to escape paying taxes by means of expense accounts, as was mentioned by the honorable member for Yarra when discussing another aspect of taxation last night. I agree with the honorable member for Melbourne Ports that the whole structure of taxation should be examined very carefully. The present position is that the Opposition can move only minor amendments to minor provisions of the bill. An examination of the relevant figures would reveal the amounts deducted from income tax contributions in respect of entertainment allowances, company allowances, advertising and such things. These are fields of deductions which reduce the national taxable income.

The report of the Commissioner of Taxation tabled recently indicates that for the income year 1953-54, 3,545,184 individual taxpayers with a gross taxable income of £2,453,390,485 contributed £319,108,467 in income tax. I suggest that it is from those taxpayers the Government obtains the great proportion of indirect taxes, to which the Opposition is strongly opposed. Reference to the Budget papers indicates that the Government estimates to collect in the current financial year, £129,500,000 in sales tax; and I believe that any tax upon consumption of goods rebounds upon salary and wage earners. Contributions in respect of customs and excise are estimated to yield £305,290,000. So it will be seen that a total of over £434,000,000 is to be collected in sales tax and customs and excise duty from salary and wage earners. The Government should examine all fields in which people are able to escape income tax, not so much by dodging it in an illegal sense but simply by avoiding payment through procedures that have developed over the years.

Another field that should be examined is income in the form of lottery winnings. During the last twelve months State lotteries have paid out the following amounts in prizes: Western Australia, £625,240; Queensland, £3,863,300; New South Wales, £8,161,590; Victoria, £5,388,328; and Tasmania, £2,145,844 - a grand total of £20,184,262. Of that amount, which represents actual prizes, nothing is contributed by way of income tax. I wish to make it clear that that is prize money, not ticket sales. I shall now make a suggestion which will probably sound heretical in a country which halts even its National Parliament during the running of the Melbourne Cup. People who make capital gains and whose wealth is increased by means of lottery prizes should contribute their share in income tax. I am not surprised that the honorable member for Hume (Mr. Anderson) shakes his head at that. Lotteries are based on the principle of taxing many to give to a few. It is based completely on chance which, I believe, is a fundamental principle of Liberal party economics. The honorable member for Hume is my favorite conservative. He is one of the few members on the Government side who are prepared to stand up and espouse his conservatism, and I respect him for it. That an amount of £20,184,262 should have gone into the pockets of Australians by way of lottery prizes without any contribution whatsoever by those prize-winners in the form of income tax is, I believe, indefensible, when one considers it in relation to a typical group of wage-earners.

I now refer to the 26,426 registered waterside workers who, as every honorable member will admit, perform essential work in the community. Although the report of the Australian Stevedoring Industry Authority does not show the actual amount paid to waterside workers, an analysis and computation of averages indicates their earnings to be in the vicinity of £23,683,400, just £3,000,000 more than a grateful Australian public paid out free of tax by way of lottery prizes. Allowing for an average income of £900 per annum, and taking into consideration deductions in respect of a wife and perhaps a family, the average income tax paid by each waterside worker amounts to £64 17s. I am referring to waterside workers because they are a group of wage-earners to whom it is easy to apply the figures; in the same way we could probably examine the cases of members of parliament, school teachers, lawyers and other workers. I estimate, using these averages as a basis, that waterside workers paid a total of £1,713,726 in income tax, from total earnings, in the vicinity of £23,683,400, whereas winners of lottery prizes totalling £20,184,262 have not been required to contribute any tax at all. I make this reference, not so much as a fundamental criticism of the Income Tax and Social Services Contribution Assessment Act, but to show the anomaly in respect of this small proportion of the national income. If, as the honorable member for Melbourne Ports suggested, the whole principle of taxation were closely examined, I am sure many other anomalies would be disclosed.

I turn now to the matter of deductions in respect of dependants. I think it was the honorable member for Mackellar (Mr. Wentworth), who often contributes something to a debate of this nature, who said that this Budget made very little concession to salary and wage earners with a family, and that the families of Australians received a raw deal. I believe the basis of progressive deduction as at present operative should be changed to a flat-rate deduction. Of a total of 3,545,184 taxpayers only 1,338,558 have spouses. I am never too sure whether “ spouses “ is the plural of “ spouse “, but it will do for this purpose. Let us take the case of a man who is earning £14 a week - a little over the basic wage - which is equivalent to £728 a year. His wife is worth to him a saving of tax of £20 10s. The saving to a man in receipt of £1,200 a year - or. to his wife if somebody is lucky enough to have a wife able to keep him - is £30 19s. 8d. The saving in tax to a man in receipt of £2,000 a year is £46 2s. 7d. When we consider those with a taxable income of £3,000 a year - we are getting now in the field of the tall poppies on the Government side - the saving is £58 19s. 9d. Amongst the really big members of the Government side - the people in receipt of £16,000 a year and over - the total saving for a wife would be £106 16s. It would be enough encouragement to join the ranks of Ibn Saud and other such people. In effect, under the income tax laws we have a means test in reverse.

Mr Coutts:

– What about those with de facto wives?

Mr BRYANT:

– I understand that the previous Labour government extended some kind of relief to them. I am confining my remarks to the position in relation to legal wives - a position in which most of us find ourselves, with the exception of lucky people who have been able to avoid that fate. The fact is that we have in the matter of family relationships in the income tax act a means test in reverse. The richer you are, the better off you are from the point of view of tax deductions.

I believe that the time has. come for us to examine carefully our income tax legislation and make a fixed deduction in relation to anybody’s wife and anybody’s child. I suggest that the deduction for a wife be £50, irrespective of the taxpayer’s income. Then a person in receipt of £678 a year and with a dependent wife would be starting to pay income tax. The allowance for each child could be, say, £40. I believe that if we are to use income tax in the social context set out in the act, we should examine the principle upon which family deductions are based.

Therefore, I suggest very strongly to the House that it is time for us to re-examine this matter and take away from the subject of income tax the general tendency or bias which makes things cheaper for you as your income mounts. This applies to such statutory deductions as rates. If your rates are £20 when you are receiving £2,000 a year, and if your income rises to £3,000 then your rates are, in fact, reduced, because the £20 deduction is subject to a higher rate in the £1. These are fundamental principles that we ought to bring to the examination of the income tax act. That is why I am particularly disappointed that members on the other side have seen fit so far to avoid taking part in this discussion. I hope to hear something fromthem later.

Those, then, are the general points 1 want to make in this debate: The principle that family allowances should be based on a fixed rate, no matter what the income of a person may be; that a person on £16,000 a year should not be able to gain any more from his deductions than the person on the lowest level. In fact, it is very important to consider the great mass of people who are in the lower income bracket. If we refer to the report of the Commissioner of Taxation, we see that the great majority of taxpayers have taxable incomes up to £1,000. In the next income grade- £1,001 to £1,250 - there are 382,728 taxpayers. In the categories up to £1,000, there are 308,900; we have even got 166,000 in the category £105 to £200. And those in that group down there even have dependent wives and children. However they manage to keep them, I do not know. Perhaps they have the honorable member for Bruce (Mr. Snedden) as their accountant - the wise old bird in a young body. The people on the highest incomes are able to avoid income tax more easily than those in the lower brackets.

These are some of the principles that should be examined. If honorable members opposite can explain why people on high incomes should be able to avoid paying income tax, I would be pleased to hear them do so. As the honorable member for Melbourne Ports (Mr. Crean) has said, we should examine the proposal that workers’ fares should be allowed as a tax deduction. But I believe that probably it would be better to examine the whole position and avoid too many deductions, and perhaps use some other sort of financial system if we want to encourage people to invest in gold mining, make donations to life-saving clubs, maintain their parentsinlaw and so on, and also if we want to develop family endowment.

We on this side of the House are dedicated to the principle of taxation based upon ability to pay. We say that income tax, then, is the fundamental side of this. It is priority No. 1 in producing a system of taxation based upon ability to pay. We are not going to say that that is the only form of taxation. Something should be done about capital gains. All of us realize that this is a particularly difficult problem. As has been pointed out by other speakers, the subject of depreciation allowances is highly technical and requires a lot of examination. But there again, I believe that capital gains and such like come into the same category as lottery winnings. If a person wins £12,000 in a lottery, he should be just as liable to contribute his share to the overhead of running the nation as the person who, for example, makes £12,000 out of writing a book, or in some other field of endeavour. Even the graziers and the supporters of the Australian Country party who make £12,000 a year from growing sheep or peanuts are just as much entitled to consideration as the person who wins the lottery. These are principles that should be used in examining the whole system.

Mr Freeth:

– Lotteries are used by the State governments to raise revenue.

Mr BRYANT:

– Yes, that is deplorable. We have come to the stage where State governments have to run their business on raffles, yet this Government can raise £1 15,000,000 in a few minutes, as the Prime Minister (Mr. Menzies) did last year, with the little Budget with a snap of the fingers and a nice inflexion of the voice and his foot on a chair.

This is a fundamental piece of financial policy, and I should like to hear the honorable member for Forrest (Mr. Freeth) make his contribution to it. I will be listening eagerly for it. The income tax act should not be treated in this rather light-hearted fashion, with people avoiding taking part in the debate and the system being changed by comparatively minor amendments. The act should come up for complete review. I support the view of the honorable member for Melbourne Ports that the whole system of taxation should come up for full review and that we should base our system on the principle of ability to pay. I would expect that if the Government were to reduce indirect taxation - sales tax, customs and excise duties, pay-roll tax and the like - the general cost structure of the whole community would be much lower and the whole of the taxation system would be simplified.

I congratulate the Treasurer on .one helpful contribution that he has made - I think he made it - that is the simplification of income tax returns, although I rather deplore the haphazard way in which taxation is being considered in this House.

Debate (on motion by Mr. Hulme) adjourned.

page 1890

QUESTION

CANNED FISH

Mr McEWEN:
Minister for Trade · Murray · CP

– by leave - To-day, the honorable member for Bass (Mr. Barnard) addressed a question to me regarding the fish-canning industry. I regret that he is absent from the House at the moment. I tried to advise him that I proposed to make a correction to the answer I gave. I said that the fishcanning industry had had an opportunity to appoint an industry panel to consult with the Department of Trade as a preliminary to requesting a hearing by Mr. M. E. McCarthy, the advisory authority to the Government on the operation of the Japanese Trade Agreement, and that the fish-canning industry had not appointed a panel. I was wrong in making that statement. I apologize to the House and to the fish-canning industry. I am informed that the industry, on the suggestion of the department, did appoint a panel and had consultations with the department on its problems four weeks ago. The point I was seeking to make is that, notwithstanding that action, the industry panel has not asked that its case be referred to Mr. McCarthy, the advisory authority.

Sitting suspended from 5.56 to 8 p.m.

page 1890

INCOME TAX AND SOCIAL SERVICES CONTRIBUTION ASSESSMENT BILL 1957

Second Reading

Debate resumed.

Mr HULME:
Petrie

– My purpose in rising in this debate is threefold. In the first place, I want to pay a tribute to the work of the other members of the Commonwealth Committee on Rates of Depreciation. They were: Mr. F. E. Hitchins, C.B.E., of Western Australia, who represented the primary producers; the late Mr. S. B. Holder,

O.B.E., F.C.A. (Aust.), of Melbourne, who was a leading member of the chartered accountancy profession of this country; Mr. Basil R. Orr, F.I.C.S., of Sydney, who represented industry, and Mr. A. M. Simpson, B.Sc, A.U.A., of Adelaide, who represented commerce. I believe that the contribution that these gentlemen made to the investigations which proceeded over a good many months was of outstanding value to the people of Australia. I think that sometimes we tend to forget public service of the nature rendered by these gentlemen in an honorary capacity, in an endeavour to assist this Parliament to an understanding of many of the problems that come before it. So I take this opportunity to express to them my personal thanks and, I believe, the thanks of all members of this Parliament for the part that they played in this investigation and in the report which has been available to honorable members for a considerable time.

Honorable Members. - Hear, hear!

Mr HULME:

– I feel that my comments would not be complete if I overlooked the secretary of the committee. Mr. R. R. Gray, an officer of the Taxation Branch in Canberra, was made available to the committee as its secretary, and as is the case with most committees of this kind, he was called upon to do a tremendous amount of work. 1 compliment him on the way in which he carried out his duties, and on the assistance which he rendered to the members of the committee during the inquiry.

I should like, secondly, to say something in connexion with one or two matters included in this bill, and which have a relation to the report that came from this Committee on Rates of Depreciation. I appreciate that some of the clauses which deal with matters such as depreciation are of a very technical nature. They are, perhaps, understood by very few people in the community, but I suggest to the House that although they may be understood by very few, everybody in the community will benefit from the increases of depreciation rates which are proposed by the bill. These depreciation concessions, as was indicated by the Treasurer (Sir Arthur Fadden) in his Budget speech recently, will cost the revenue £35,000,000 next year, that being the year in which they will become effective in relation to income tax returns based on the current income year,

That £35,000,000 will not be a gift to the people who receive the benefit of the depreciation allowances, but will become a part of the cost structure. Because the concessions will be worked into costs, they eventually will reach the consumer by way of lower prices. For that reason I believe, as I said earlier, that the whole of the community will benefit from these additional depreciation allowances. Hence, they are a matter of real community interest, real community concern and real community benefit.

I know that members of the Opposition will be inclined to deny the fact that these benefits will be passed on to the consuming public eventually, but I suggest that the business community is not as hungry as the members of the Opposition sometimes endeavour to make us and the community as a whole believe it is. The members of the business community, I appreciate, are out to make profits, but the business community is working in competition, and I believe that, in 1957, competition is much greater than it has been over the last five or ten years. This factor of competition, if nothing else, will force people to pass on the additional advantages which they will receive from these increased depreciation allowances, which, as I have said, will cost £35,000,000 a year.

Mr Crean:

– Did not the Minister for Primary Industry yesterday argue the reverse case with regard to the abolition of the pay-roll tax?

Mr HULME:

– I cannot be responsible for what the Minister might have said yesterday. I cannot recollect exactly what he said, but 1 am prepared to be responsible for my own statements in regard to these matters. I have expressed my own beliefs, and I am prepared to stand up to reasonable challenge of my comments.

The next point to which I want to refer particularly concerns a matter on which the honorable member for Melbourne Ports (Mr. Crean) spent a good deal of time. It was the subject of a recommendation of the Committee on Rates of Depreciation which was accepted by the Treasurer and the Government, and is included in the bill before the House. It is known as balancing adjustment. Once again, I am afraid that I am about to deal with a fairly technical matter which is not perhaps clearly understood; but since the honorable member for Melbourne Ports dealt with it, I feel that there is an obligation on me also to deal with it, particularly with certain aspects which he mentioned. There are two aspects of these balancing adjustments. The first is that if an item of plant is disposed of and the sale price is lower than the written down value, the taxpayer is allowed the difference, as additional depreciation, in the year of sale. I am concerned not with that aspect, but rather with the other side of the picture, where, in fact, there is a recovery on the sale price of an amount that has already been allowed as depreciation.

I think that perhaps this matter may better be explained if I try to give a simple illustration. Let us take, for instance, a depreciable item, such as an item of plant, which cost £10,000, and estimate that over a period of six years depreciation of £6,000 has been allowed, leaving a written down value of £4,000. If, when that item of plant is disposed of, the sale price is £7,000, there is in fact a recovery of depreciation of £3,000, that being the difference between the sale price of £7,000, and £4,000, which is the written down value. The £3,000 represents a recovery of part of the £6,000 depreciation which has been allowed over a period of six years.

At present, the £3,000 is wholly taxable in the year in which the item of plant is disposed of. To carry the example a little farther, the amount of £3,000 is taxable, in accordance with the bill before us, not only if the item is disposed of but also if it is lost or destroyed - although I think it is easier to understand the proposition if we concentrate on the aspect of disposal, rather than that of loss or destruction. Instead of depreciation having been at the rate of £1,000 per annum during the life of that item, it was really at the rate of £500 per annum. On this basis, the taxpayer is taxed on £3,000 in one lump sum, instead of his having paid tax on an additional £500 in each of the six years in which depreciation was allowed. The amendment allows for the amount of £3,000 to be set off against other depreciable items of plant, or against a replacement item of plant.

It is on this particular aspect that I join issue with the honorable member for Melbourne Ports, who said, speaking presumably on behalf of the Labour party, that he approved of this provision in cases in which the asset was lost or destroyed, but disapproved of its application where the asset was disposed of. As the Treasurer pointed out in his second-reading speech, the act as at present operating provides for heavy payment of tax on this recovery of depreciation in the year in which the plant is replaced, which is the year in which the taxpayer requires substantial funds to meet the replacement costs. I shall go a little further than did the Treasurer; I suggest that it is surely inequitable both to write back and tax in one year that which relates to several years. If it were practicable - and I suggest that it is not - the correct procedure would be to go back to the point of time at which the item of plant was first purchased and re-assess the income over the six intervening years. Of course, it may not always be six years; it may be fifteen years or even a longer period. I think every honorable member will agree that it would be impossible for the taxation authorities to attempt to re-assess income over lengthy periods of time. When one has regard to the fact that the increased prices being received for second-hand plant are due, in no small degree, to inflationary pressures during the last ten years, one must surely be somewhat impressed by the depreciation provisions of this bill.

Most people in the community, after careful analysis of the position, would see very little substance in the point of view that was expressed by the honorable member for Melbourne Ports. The honorable member went on to say - I think this was particularly unfortunate - that the committee on rates of depreciation would not have made this recommendation if it had been an all-party committee. In other words, he contends that if the committee had been composed of honorable members from both sides of the House we would not now be considering a bill in the form of the one which is before us. I want to resist most strongly the suggestion inherent in that comment by the honorable member. The men who served on that committee, particularly the four whom I mentioned at the beginning of my remarks, were men of honour, integrity and wide experience in these matters. In no circumstances would they have approached a matter of national importance with any party-political bias. I regret very much that in a national matter of this kind Opposition members would not feel capable of hearing evidence, analysing that evidence, and preparing a report on a basis of fact rather than of party politics. I am particularly surprised that such comments should have been made by the honorable member for Melbourne Ports, because it was my privilege to serve with him for three or four years on the Public Accounts Committee, which, of course, is composed of honorable members from both sides of the House, and at no stage did the honorable member’s statements or actions suggest a party-political approach to the deliberations of the committee.

The honorable member for Herbert (Mr. Edmonds) has been attempting to interject, and I think it would do no harm to remind the House of what was said by the honorable member for Herbert with regard to the item in the Estimates covering the cost of this committee on rates of depreciation. The honorable member made some critical remarks regarding the estimated cost of the committee, not because of the work that it had to carry out, but because he contended the money spent on it would be completely wasted as the Government would never implement its recommendations. I think the honorable member will remember the comments he made on that occasion, which constituted a reflection on the Government rather than on the members of the committee. I am pleased that most of the committee’s recommendations were implemented in the legislation passed by this Parliament twelve months ago, or will be implemented as a result of the legislation that is now before us.

The only other matter that I wish to refer to relates to the increase of £13 in the allowance for dependants. It has been suggested by the honorable member for Melbourne Ports that the Opposition intends to move, at the committee stage, an amendment designed to increase this amount from £13 to £26. Although the allowance for a wife will be increased from £130 to only £143, which does not appear to be a very substantial increase, and although the allowance for other dependants also has been increased by what may appear to be the small amount of £13, I am sure that the vast majority of the people, and most honorable members, do not realize the cost to the Government of this additional concession. In a full year, it will cost about £8,500,000, and in this year alone it will cost £7,700,000. Those amounts are not of small magnitude, and when we remember how these allowances were increased in 1953 we can say that this Government is constantly considering the desirability of assisting the family man in the matter of income tax concessions. I believe that, as time goes on, the Government will take the opportunity to make other increases in these allowances, which will, of course, have the effect of reducing the tax paid by the family man. I believe that the Government has been commended ever since it was elected in 1949, and that it is still being commended, for what it has done to reduce rates of taxation and increase concessional allowances, and for its general approach to income taxation.

Mr THOMPSON:
Port Adelaide

– The honorable member for Petrie (Mr. Hulme), who has just concluded his speech, devoted some attention to depreciation allowances, and I agree with him that there have been many anomalies in this respect. The committee which investigated taxation matters, of which the honorable member was chairman, submitted a good report to the Government and its recommendations have been practically accepted. I think this bill embodies some of the recommendations made, although others were accepted before. However, I do not intend to deal with that phase of the matter. I wish to speak on one or two aspects which have come to my attention and which have not been mentioned in this debate.

A couple of months ago the Public Accounts Committee visited Darwin to investigate the accounts of various Government activities in the Northern Territory. Arguments were placed before that committee from all sections of the community emphasizing the heavy cost of living at Darwin, and one suggestion to offset this burden was that the taxation zone allowance should be increased. I am not speaking of evidence taken by the committee but of what I heard from various members of that community. It was suggested that the present £180 allowed as an additional reduction for residents in Darwin should be increased to at least £500. I suppose that the honorable member for Herbert (Mr. Edmonds) would say that the residents in some parts of northern Queensland should be treated likewise.

I did not agree with the people in Darwin that the proper way to grant relief was to increase the allowance from £180 to £500. My contention was, and still is, that the Government should increase not only the allowance of £180 but also the concessional allowances for dependants. If the £180 were increased to £500 the single man would benefit as well as the family man; but in addition I consider that something should be done to increase the concessional allowances for the family man. I do not see any provision in the bill of that nature. I suggest to the Treasurer (Sir Arthur Fadden) that the people in the Northern Territory are entitled to greater consideration than the £180 allowance for living in that isolated part of Australia. I do not know whether the Treasurer intends to do something for them, but they deserve special consideration because the cost of living up there is simply tremendous.

As an illustration, I will refer to a statement made to me by a contractor who is employing a number of men on the construction of buildings in Darwin. Under the award he is obliged to provide suitable hostel accommodation and food for his employees and for this he is allowed a tax deduction of £2 15s weekly in respect of keep for each employee. But he said that it costs him more than £6 a week a head to keep these men. In the Government hostels the same conditions prevail. That gives some idea of the high cost of living in that area. It does not matter whether a person in Darwin buys a packet of rolled oats from Queensland for the breakfast table or any other kind of foodstuff, heavy freight charges have to be paid on all goods, and this adds to the high cost of living. The Treasurer should consider granting greater taxation concessions to these people. They would tend to reduce the cost of building and of other items, and would be of great benefit to the residents.

I wish to refer to the extra £13 that is being allowed as a deduction for a taxpayer’s wife and children. In 1952, when a similar measure was before the House I suggested that the £104 then allowed as a deduction for a wife should be increased to £156. I advocated also that the deduction for the first child should be raised to £104, and that for each of the other children to £78. That was five years ago. At the committee stage, the honorable member for Melbourne Ports (Mr. Crean) will move, on behalf of the Opposition, that these respective allowances should be increased to those figures. In 1953, the Government increased the allowances by about half the amount I suggested. The allowance for a wife was increased to £130 from £104 and for the first and succeeding children, proportionately on the previous figure. In this bill it appears that the Government is going half the remaining distance and the allowances for wife and children will be approximately three-quarters of the amount I suggested in 1952.

Some might ask on what grounds I base the figures I suggest. The first is that no alteration has been made in the amount of child endowment since 1948 when the figure was fixed at 10s. a week. In the intervening period all costs have practically doubled. In 1952, I contended that some increase should be made in the taxation allowance for children, and I consider that instead of the Government making this increase of £13 it should make it £26, as the honorable member for Melbourne Ports suggested. I understand that Parliament will be asked to deal with two or three taxation measures and some of their provisions may overlap a little but in some cases the rates would not affect one another.

However, more consideration must be given to families. The man who has been given the least amount of assistance in all the legislation that has been passed and in all the awards made by arbitration courts, whether it be in respect of child endowment or any other phase of wages or allowances, is the family man, the ordinary worker in industry. The honorable member for Petrie suggested to-night that the cost of implementing this measure would be an extra £8,000,000. Let us consider for a moment who will derive the real benefit from this additional £13 concession. A man on a high income may be paying tax at the rate of 10s. in the £1, but he would still have a handsome income after he paid tax. As a result of a 10s. in the £1 concession because of the £13 extra allowance he will benefit by £6 10s. in tax. But let us contrast the position of the worker who has a wife and three or four children to support, and who is earning the basic wage or a few pounds more. That man cannot get a benefit of 10s. in the £1 on the additional allowance of £13. His benefit will probably be not more than about ls. in the £1. This means that he will gain about 13s. as against the gain of £6 10s. to the man on a high income. That shows that we are not doing as much as we could for the man on the lower income.

I admit that years ago I argued that the man on a high income who has to support a wife and children has more right to the benefit of child endowment than the high-salaried man who has no children or wife to keep. I do not argue so much about a high salaried family man receiving the benefit of this extra £13 allowance, but as the honorable member for Petrie said, although it might not sound very much, the real benefit of that £13 extra allowance will go to the man who least needs it. The man on the low wage, at the bottom of the industrial ladder, who needs it most, will not receive much benefit. Honorable members opposite may argue that a man who has a wife and three children will receive an additional benefit - a deduction of £52 for the year - and that though it may seem small when stated as only ls. a week it does mean a reduction of his final income tax assessment by £2 12s. I know that the Treasurer is faced with a difficult problem and I sympathize with him in his endeavours to give any taxation reductions whatsoever because I realize that his great problem is to devise means of granting a reduction that is equitable to everybody.

During the lifetime of the Labour government a different system operated. In those days, we had a system of rebates instead of deductions. I recall that members of the present Government who were then in Opposition advocated the deduction system in preference to the rebate system because under the deduction system those in receipt of higher incomes would receive greater reductions than they would under the rebate system.

The honorable member for Wills (Mr. Bryant) had in mind a different system. He advocated that instead of deducting from the gross income the allowance of £143 for a wife, £50 should be deducted from the actual amount of tax assessed. If this were done, it would mean that the man on the lower income would derive exactly the same benefit as the person in receipt of a high income. He suggested also that the same principle should operate in connexion with allowances for children, and that instead of allowing the taxpayer to deduct from his gross income £91 for the first child, a certain definite sum should be deducted from his final tax assessment. If that system were adopted, the family man would receive a definite benefit for his- children. As I have stated already, under the present system of deducting £91 from the gross income, a man who is taxed at the rate of ls. or 2s. in the £1 does not receive anything like the benefit enjoyed by the person who pays a much higher rate of tax.

All these matters will have to be considered if we really want to encourage people to have larger families. When 1 was working in industry 30 years ago, there was no such thing as child endowment. I had six children, and two or three of the other men working with me had no children at all. In those days, the basic wage was assessed on the reasonable needs of a man, wife and three children. Under that system, I got nothing for the other three children. I pointed out to my workmates that as they had no children but were receiving a wage deemed to be adequate for a man, wife and three children, they were at an advantage to the extent of what was, in effect, the cost of keeping three children. The whole system was inequitable.

I do not wish to deal with pay-roll tax and child endowment now, other than to say that, years ago, I put forward strong arguments for consideration for the working man. I point out now that when I speak of the working man I refer to my mates in trade unions and in industry, not to the persons in receipt of high salaries and large incomes. I argued in those days that if the government sincerely wanted to give the family man some benefit, it had to give him something based on his family responsibilities. I admit that when I advanced those arguments I realized that if I put forward my suggestions at union meetings my workmates with no children would howl me down. I knew they would do so because, as they had no children, and as they were receiving a wage based on the reasonable needs of a man, wife and three children, they did not want to lose what they were already enjoying.

I am submitting these views to-night to illustrate my advocacy of a more equitable means of spreading the burden of taxation. As I have said many times, we on this side have a different view from that held by honorable members opposite. They have supported the flat rate of taxation over the years. We, on the other hand, argue that taxation should be based on a person’s ability to pay, and we support that principle to the utmost. In the depression years when I was a member of a State parliament the person on the highest income paid only ls. 2d. in the £1 and the worker on the smallest income was required to pay tax at the same rate. But all governments have begun to realize that we must have a sliding scale of taxation, and I am happy to be able to say that during my parliamentary life 1 have seen a gradual abolition of inequities up.d the steady introduction of a more equitable system. But I still believe we have not yet reached the pinnacle of perfection with our taxation system; it is not as equitable as it might be. I admit that even though the additional benefit proposed now is only £13 for each member of the family, it is, as it were, another step towards the pinnacle. At the same time I feel that the step taken is far too small and that the Treasurer could have gone the full distance. Even though he has gone a long way in connexion with the depreciation allowance, I do not think that will be the great benefit that some expect at first glance. I say that because of the fact that once depreciation on an article runs out, no further allowance is granted. It is proposed now that, instead of spreading depreciation over a long period as has been done hitherto, a high allowance will be granted in the early stages. This can only mean that the depreciation will be at a much lower rate later. Even so, it must be admitted that the Government has taken a big step in connexion with depreciation and I should like it to take an equally big step in connexion with concessions to the family man.

I think the honorable member for Petrie (Mr. Hulme) said that the concessions proposed in this bill would cost the Government about £7,700,000 for the balance of this year and £8,000,000 for a full year. This means that if the Government accepted our suggestion, which will be embodied in an amendment to be moved by the honorable member for Melbourne Ports, the cost to the Government will be only another £8,000,000. That being so, I ask honorable members to give serious consideration to the suggestion.

At the same time, I am under no illusion about this matter. I know that once the Treasurer brings down a bill the Government has decided that is as far as it will go. I know that no matter what we on this side suggest, the amendment will be rejected when a vote is taken. I do not believe for a moment that anything I have said to-night will have any effect on the Government’s decision. Even if my case were perfect, I do not think it would affect the Government’s decision one iota. But I have spoken to-night because of my firm belief that by hammering away with suggestions for improvements, we might receive a little more next year. My policy has been not to abuse the Government but always to endeavour to submit a case that is deserving of consideration in the hope that eventually we shall get something. Why, it was only five years ago that we suggested that the allowance be increased by 50 per cent. Since then, it has been increased by 25 per cent. It is proposed now to increase it by another 12i per cent. I firmly believe that it is more than possible that next year we shall get a little more and reach the 50 per cent, we asked for five years ago.

It is quite likely that, even then, we shall want a bit more because, as I have said, we have a long way to go to the summit. However, I appreciate what has been done in connexion with the allowances in respect of wives and children. I do not desire to go over what the Treasurer (Sir Arthur Fadden) has told us about the necessity to widen the provisions with respect to stepchildren or adopted children. But there is one matter which I hope the department will consider a little. I refer to the fact that before payments to one’s parents can be regarded as allowable deductions for income tax purposes, one must be wholly supporting the parents. Quite a number of pensioners have sons who give them a couple of pounds a week in order to help them. In these cases, the son does not wholly support the parents, but makes a contribution because the pension is not sufficient to meet their needs in a reasonable manner. But because they are receiving a pension, the amount contributed by the son is not deductible from his income for taxation purposes. I think that this is a phase of taxation that should be taken up by the Taxation Branch and the Treasurer with a view to making such assistance to parents deductible from taxable income.

It is true that in this connexion, our legislation has been improved in the course of the years. I remember that years ago a bank teller said to me, “ Can’t you .do something for me in the way of taxation deductions? I have a sister who lost her husband and I am supporting her five children, but I cannot have my taxable income reduced on that account.” To-day, we have gone along the track a bit in order to help such people. We are gradually progressing and we want to continue progressing. Eventually, legislation was brought in, by either the Federal or State Government, which relieved the position of taxpayers such as the teller to whom I have referred. So I believe something can and should be done for the man who is partly supporting a parent.

There is only one other matter in the bill before us to which I desire to refer and it is partly connected with another of these taxation measures. I am very pleased that the Treasurer has taken action to benefit, to a degree, friendly society dispensaries. I have had a lifetime of experience with dispensaries, although not so much in recent years since I have been in Canberra. I have had long experience of the difficulties of financing them. I know that in South Australia, after I came into this House, a statute was amended to provide that friendly societies could not increase the number of shops that they had in that State. They were tied down to the number that they had at the time. These dispensaries have had a big job to do. We all know of the high cost of medicine. We all know the difficulty that has been experienced in procuring dispensers to work in the shops of friendly societies. In Adelaide the societies had to combine in order to be able to buy chemicals and man the shops on a good basis. Up to a few years ago, these dispensaries were not paying any income tax at all. Even when the Chifley legislation was brought in they did not have to pay tax. But since then they have become liable to the payment of tax. Last year, or the year before, the amount of tax that had to be paid by national pharmacies in South Australia took practically all their profits and they had difficulty in continuing. The amendment now proposed by the Treasurer will help them, but I do not know to what degree. As I have said, this is another step towards helping deserving people. It came pretty hard to the co-operative dispensary movement when they found that other co-operative societies had to pay only very low taxation or were exempt from taxation. But this is a matter to which 1 wanted to refer only briefly. I express my appreciation that some consideration has been given to the position of friendly society dispensaries with the result that this bill will ameliorate their condition.

As I mentioned earlier, I have sympathy for the Treasurer because of the great difficulties associated with achieving equity in connexion with taxation allowances. For years I have felt that it is so difficult -to understand the principles of taxation allowances that, as the honorable member for Petrie (Mr. Hulme) has stated in reference to depreciation allowances, the ordinary person has not sufficient knowledge to appreciate the benefits to be derived from this kind of provision. Whilst the Opposition is able to say with reasonable assurance the amount that it considers should be paid in tax by the worker in industry it is a very complex matter to decide for instance what allowance should be given to the man on the farm for doing such things as planting trees or cutting water channels. I know the Taxation Branch has a difficult row to hoe. I am not just harping on these matters. I have put forward what I think should be done for the family man and I trust that, in future, my remarks will bear fruit.

Mr WENTWORTH:
Mackellar

– I appreciate the generous attitude of the honorable member for Port Adelaide (Mr. Thompson) to this bill. I shall be glad to support the measure, but I do think that it is a little regrettable that the Government has not yet found an opportunity to make a more thorough revision of the income tax provisions. It does seem to me - and I think it has been expressed earlier in this debate - that income tax is an instrument, not merely for raising revenue, but for bringing about certain desirable social adjustments. The time has now come when the whole act should be re-thought and, if necessary, refashioned in quite fundamental regards. I feel that the time has come to simplify the act yet further.

One of the first things that the Government did when it achieved power was to bring in a very notable simplification of the income tax legislation. That was a great achievement. I hope that it will be followed up. One sees, for example, that the provisions in regard to age allowances are still rather complex and difficult to follow, particularly for the people who should be benefiting from them. The act, with advantage, could be simplified. This is something which always occurs: An act, having been simplified, is then amended; complications creep in and the time comes, sooner or later, for a thorough recodification such as this Government carried through in 1950. I believe that the time has now come for another thorough recodification of the act in the light of circumstances that have developed since that date.

Further than that, I think the time has come when we should be using income tax more objectively as an instrument of decentralization. I, for one, do not feel that the zone allowances are adequate. Nor do I feel that it is right that the zone allowances should be given over so restricted an area as that to which they apply. If we believe in decentralization - and I think we do on this side of the House - then we should be using the zone allowances in the principal act as a means of bringing about decentralization, not only for the benefit of distant States but for the benefit of the more distant parts of the principal States on the eastern seaboard. I know that these things are not easy to do. I know that they will require a great deal of administrative consideration. I know that they cannot be done piecemeal, and therefore they cannot be done by amendments moved in this House to one or other clauses of the bill. They should be done on an overall reconsideration of the income tax legislation. In my view, the time has come to reconsider the act, and we should take this opportunity to do so if we believe in the principle of decentralization - and I think Government supporters do genuinely believe in that principle.

The act should be used more consciously as an instrument of development. Let me instance one or two things as an example, rather than as a comprehensive review of the situation. The Treasurer (Sir Arthur Fadden) has given some concessions in connexion with the , exploration for oil in Australia. Surely we should look upon the exploration for oil in Australia as something which is urgent. The Middle East situation is such that the finding of oil in Australia would add materially to this country’s security, both from the defence angle and from the economic angle. The concessions that have been outlined by the Government, good though they are, are not sufficient, and do not measure up to the urgency of the situation as indicated by the march of events in the Middle East. For example, the Government could have granted concessions for investment in oil exploration DJ Australian nationals on the Australian mainland and in the Territory of Papua and New Guinea. Such concessions would have been costly to revenue, but in the last analysis, when considered as a defence measure and as an economic measure, they would have been well worth while.

The Government could, perhaps, be making greater allowances for technical education. Surely amounts spent on technical education should be a deduction for income tax purposes. Soviet Russia is moving ahead of the free world in certain respects because she is able to allocate a greater proportion of her resources for these capital expenditures. Expenditure on technical education is a capital expenditure, because our capital assets are measured not merely in factories, but in the skill of those who work in the factories, those who manage the factories, and those who frame the nation’s economy. I do not think that we are yet taking sufficient cognizance of this. Although income tax is only a minor factor in this whole scheme, it is a factor which should be part of the whole scheme, and which the Government might have taken into account when framing this bill. I do not think we are yet sufficiently alive to the need for building up our capital in the form of individual skills, as well as in the form of factories and other material equipment.

One of the desirable things that this bill does is to widen slightly the concession under which gifts for national purposes may be claimed as allowable deductions for income tax purposes. I know that the Treasurer and other people have said that the effect of this concession is simply that the Commonwealth pays part of the gift. That is so, but if we think that these gifts are being made for national purposes, if we think that very often they are best administered not by a centralized body, but by individual bodies, then the scope for widening this particular feature of the act is surely greater than admitted in the drafting of this bill. Here is an opportunity to channel a greater proportion of our national income into purposes which will increase national productivity, national security, and our living standards. I do not for one moment ignore the difficulties associated with this proposal, nor do I ignore the possibilities of its being abused; but even making all those reservations, I still believe that the Government, although it has moved in the right direction, has not moved far enough or fast enough.

Let me come to a matter that has been raised previously in this debate by speakers from both sides of the House. It is proposed in this bill to make a somewhat greater allowance for the family. But is it sufficient? I do not believe that this bill can be considered in isolation, and that is why I do not think that the piecemeal amendment of the legislation means very much. What is to be done has to be done as part of a concerted scheme, properly conceived at top level. The time has come when some better overall consideration might be given to this aspect. The family is not getting a fair deal. I am reminded of the remarks made by the honorable member for Port Adelaide in this debate, that the family man is not getting a fair share of the national income. This means, in effect, that those persons without family responsibilities are paying perhaps a little less than their fair share, because any amendments made to the act must be correlated with other amendments so as to leave unaffected the total amount of revenue collected from income tax. If less is put on one, more must be put on another.

Mr Thompson:

– As long as there is equity.

Mr WENTWORTH:

– The question of equity is one which is not foreign to the consideration of these matters. One of the great troubles about our Australian system - here again, I echo the remarks of the honorable member for Port Adelaide - is that our basic wage is computed for a man, wife, and two children. It is not quite enough for them, but it is too much, perhaps, for those who have no family responsibilities. If we are going to amend this, we have to look at the matter as a whole, and correlate this legislation with the social services legislation. Piecemeal amendment is not enough; in point of fact, it is no good at all. We have to think in terms of giving more to the family man, which certainly means giving less in terms of retained income to the teenager, and the man without family responsibilities. We have to consider this in relation to an amendment to the whole scale of rates, but it should mean a much greater and more generous allowance for the man who has a wife or children, or the man who has to find the means of supporting aged or invalid dependants. We cannot do it in isolation.

Here again, one meets another problem. We have to give to the people, whether they are single or married, whether they have family responsibilities or not, the opportunity to save, and particularly we have to give to the young person the opportunity to save in prospect of marriage. I would think that we should put into the act provision for some arrangement under which people could deposit money with the Treasury as a deduction from their taxable incomes, on condition that when they withdraw it from the Treasury it would be an accretion to their taxable incomes. We should also make an overriding extra provision that on marriage they can withdraw, free of accretion, a stated amount - £1,000, £1,500, or £2,000; I do not want to be bound to a figure, but I stand by the principle. That would mean that those people who had no family dependants and who wished to save would be able to save without being penalized by the Income Tax Act; and that those who had no family dependants and did not want to save would be penalized by the Income Tax Act and would be made, as the honorable member for Port Adelaide said, to bear an equitable share of the overall taxation burden, which has to be borne anyway.

I feel that the Government may have been at fault in repealing the Chifley act for the establishment of the National Welfare Fund. If we are to use our taxation powers for the readjustment of our social services, something is to be said for the principle, which the late Mr. Chifley put forward, of imposing a special amount of tax, the proceeds from which would be paid into the National Welfare Fund. I do not want to be bound to the details of that tax. I would say, however, that there is something to be said for the principle of having such a National Welfare Fund, and it needs to be looked at carefully. According to the principle which Mr. Chifley enunciated, a more or less flat rate would be struck on assessable income and the proceeds paid into a fund hypothecated for the purpose of national welfare. I am not quite certain that the Government would not be wise to revert to that principle.

Let me end by saying that I do not think there is any advantage in making small amendments to the act. What is needed is an overall review of this act once again. The Government did a good job in making an overall review of the act in 1950. The time has now come for a further overall review, not for small amendments, but for a re-statement of the whole basis upon which income tax is collected.

Sir WILFRID KENT HUGHES:
Chisholm

– I do not want to take up any great length of time upon this bill, but I want to make an appeal to the Government, to honorable members on this side of the House and to honorable members on the other side, to accept an amendment that I propose to move in committee. The amendment deals with something which has been put up several times before and not accepted, and it relates to section 78 - Gifts, contributions, allowances and pensions. The Treasurer (Sir Arthur Fadden) said in his speech -

It is proposed that the allowance for gifts of £1 and upwards to specified funds and institutions in Australia shall be extended to gifts to the following: -

The National Trust in each of the States of New South Wales, Victoria and South Australia.

Public libraries, museums and art galleries.

The Sydney Opera House Appeal Fund.

The Sidney Myer Music Bowl Trust.

The Australian Design Council of Australia.

I know it is very difficult to deal with all the applications that probably come under this heading. The act started off with very few specified funds and institutions. It commenced with hospitals and benevolent institutions, and then war memorials, defence, education, science, music, and a few other activities were included, such as the Australian Elizabethan Theatre Trust, the chairman of which, I think, is the Governor of the Commonwealth Bank, and the Australian Administrative Staff College. There are now to be added the Sydney Opera House Appeal Fund and the Sidney Myer Music Bowl Trust in Melbourne. I have no criticism whatever to make of those additions. Good luck to all of those organizations! Most of them deal with the arts, science or music - activities which are nonprofit making and are conducted for the benefit of the people as a whole. The amendment I propose to move in committee is for the addition of the Australian Olympic Federation Appeal Fund for sending Australian teams to Olympic Games.

Almost a year ago we had the honour of holding the Olympic Games in Australia. Will any honorable member deny that the games are among the best movements for peace, international goodwill, and international understanding, among the younger generations of the world? In fact, I sometimes wonder why the Nobel peace prize committee has not considered the president of the International Olympic Committee as being worthy of its award. The Australian citizens, as a whole, created the atmosphere of the games. It was not just the games; it was not just the organization. It was the manner in which the Australian people created that atmosphere of goodwill, good sportsmanship and good friendship that resulted in our achieving a tremendous amount of international goodwill at a time when we needed it, during that period of international tension following the Suez decision. It has gone on ever since. We could not value the publicity in terms of money.

In 1939, there were 2,200 members of an amateur athletic association of which I am a member, and over 2,100 enlisted. If it were possible to turn this fund into a war memorial fund, that would be all right, but we have been told that we cannot do it. The organizers cannot run lotteries to raise funds, and the only opportunity they have of getting any assistance is by direct subsidy from the Government. Governments have assisted in the past and, of course, they did a magnificent job in connexion with the recent Olympic Games. I think that they received more than a fair return for the money. I do not know why the Treasury, which was the only source of criticism, criticized the expenditure after the Olympic Games were over. However, it dropped its criticism very quickly.

The problems are very difficult. Every four years, the people who, by their efforts day in and day out, in their spare time, and time not so spare, made a success of the Olympic Games, must select teams, and raise all the money required through their amateur associations to send the next team to the Olympics. These are the only sporting bodies that do not receive revenue from gate money paid to see sporting events participated in by sporting teams that go abroad. Therefore, the whole of the money has to be raised in Australia. These bodies raised £100,000 to send the Australian team to Helsinki for the 1952 Olympic Games. We owe it to the other nations that supported the Games held in Melbourne to send to future Olympic contests, not teams of nohopers, but fully representative teams.

I will have more to say on the matter in committee, and I appeal now to honorable members to support the amendment that I propose to move. I ask the Government not to say merely, in those honeyed words that we often hear - I know that Treasurers and other Ministers have to use them -“We will consider the matter”. The Australian people are certain to support the proposal. When I asked for a £200,000 trust fund instead of the present proposal, the idea received support from practically every newspaper in Australia. It was turned down; it may have been for a very good reason. Once the recent Olympic Games held in Melbourne are more than a year behind us, it will be very difficult to get the money. Surely no one will tell me that there is anything better for the younger generation, or more beneficial to physical and national fitness, and to international goodwill, than the Olympic Games, and the sending abroad of teams to contest them. If there is anything better, I should like to hear of it. I trust that honorable members will support the amendment that I propose to move in committee.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 11 - by leave - taken together, and agreed to.

Clause 12 (Disposal, loss or destruction of depreciated property).

Mr CREAN:
Melbourne Ports

.- I wish to clarify a point raised by the honorable member for Petrie (Mr. Hulme) in relation to the Opposition’s attitude to what I termed, before the suspension of the sitting for dinner, a dubious principle that had been adopted by proposing to insert in section 59 (2a.) the word “ disposal “. As the honorable member rightly pointed out, this is a technical matter, and I think that I should read to the committee the relevant sub-sections of section 59 of the act in order to show precisely what is being done. Sub-section (1.) reads -

Where any property of a taxpayer, in respect of which depreciation has been allowed or is allowable under this or the previous Act, is disposed of, lost or destroyed at any time in the year of income, the depreciated value of the property at that time, less the amount of any consideration receivable in respect of the disposal, loss or destruction, shall be an allowable deduction.

That sub-section provides for the case in which an asset subject to depreciation is actually sold at less than its depreciated value. The difference between the sale pried and the depreciated value is then allowed as a deduction in that year. Sub-section (2.) provides -

If that consideration exceeds that depreciated value, the excess, to the extent of the sum of the amounts allowed and allowable in assessments for income tax under this Act and any previous law . shall, subject to the succeeding provisions of this section, be included in his assessable income of that year.

That sub-section covers the case where an asset subject to depreciation is sold at a price in excess of the depreciated value. The difference normally is included in the assessable income of that year. Those are principles that have been established over a considerable number of years. If a depreciated asset is sold at less than the writtendown value, the difference is deducted from the assessable income for the year. Conversely, if a depreciated asset is sold for more than the depreciated value, the excess is written back into income in that year. A variation was made by the insertion, in 1 942, of sub-section (2a.) to cover, particularly, losses by war damage. This sub-section, as amended in 1 956. refers to “ an amount, being the whole or a part of the consideration receivable in respect of the loss or destruction “. The word “ disposal “ is not included.

I stated, on behalf of the Australian Labour party, that the party felt that there was some justice in allowing a taxpayer who intended to replace an asset lost as a result of the cataclysm of war, and to continue in business, to off-set the excess against any other property subject to depreciation, as that sub-section provides, instead of adding it to the assessable income for the year. It is now proposed to go further and to insert the word “ disposal “, in order to provide for something due, not to the abnormal circumstances of war, but purely to the exercise of a choice on the part of the taxpayer.

The honorable member for Petrie gave as an illustration of his argument the case of a piece of property valued originally at £10,000, which, over six years, had been written down to £4,000 and subsequently was sold for £7,000. He said that the proper thing to do would be to average the excess, or over-allowance, over the previous years by amending, in effect, each of the assessments involved. He said, also, that that would be difficult. I am prepared to concede that it would be a difficult thing to do. The honorable member stated, of course, that one of the reasons for such an over-allowance of depreciation is that, owing to inflation, property bought some years ago can now be sold at enhanced values. However, it is not only businesses that are subject to the effects of inflation. Other sections of the community are not able to insulate themselves against those effects in the way that this proposal would allow businesses to insulate themselves.

You may recall, Mr. Chairman, that, some years ago, when inflation was at its height, accountants were arguing as to whether depreciation should properly be calculated on what is known as the historical cost, or whether it would be better to try to work out some notional figure, taking into account the effects of inflation, and replacement costs, and to compute the annual depreciation on that basis. Those arguments have now died down, not because inflation has disappeared altogether, but because it is now much less severe than it was. The consensus of most expert committees when the arguments were rife was that the principle of calculating depreciation on historical cost should be retained, largely because, if legislative provision such as this was made, a favour would be bestowed on one section of the community to the disadvantage of the rest of the community not able to obtain the benefit of the provision. . In simple terms, the present proposal seems to mean that the depreciation allowance allowed over several years, which, according to the normal practice under section 59 (2.), would then be written back and included in the assessable income of the year, should not now be so written back. This would mean, in effect, that the tax paid would be less than the law suggests that it should be.

The solution is not, as the honorable member for Petrie says, to amend the assessment for that year but simply to say that that excess of £3,000 which ought - I emphasize the word “ ought “ - in normal circumstances to be included in the assessable income for the year should be written off completely different assets. In effect you would then get your depreciation. I suppose it would mean a slight increase in the assessment for the year, because the residual depreciation would then be charged on the value of the remaining assets less £3,000. You would have a lower starting point for computing depreciation in that year.

The Treasurer does not seem to think that this is a fair argument. It introduces a completely new principle into the computation of depreciation, namely, that an excess of depreciation over a period of years on one piece of plant or set of items should, in order to relieve the tax burden on a section of the community only, be written off completely in one year on entirely different property. The amount written off would have no relation to the estimated life of that plant. The Opposition does not intend to oppose the clause, but I think we all ought to be honest about what is being done.

The CHAIRMAN:

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

Mr HULME:
Petrie

.- I am afraid, as I mentioned at the second reading stage, that I do not understand the attitude of the Opposition on this matter. I again use the illustration that has been referred to by the honorable member for Melbourne Ports (Mr. Crean) - where in a particular year one has a recovery of depreciation to the extent of £3,000. The whole of that £3,000 would be assessable income in that year. It could be said that it should have been distributed over the years in which the depreciation was written off. The period mentioned in the illustration was six years, but it could easily have been 18 or 20 years, or even more than that.

One can appreciate the impact, on the sale price, of taxation on such a large recovery of depreciation. That recovery of depreciation would be an addition to the normal income, and would have the effect of substantially increasing the rate of tax in the case of an individual. Of course, in the case of a company it would not have that effect unless the income was under £5,000. But I repeat that, in the case of the individual, it would substantially increase the rate of tax that was applied, not only to that £3,000, but also to what would be the normal income of the individual in that particular year.

Let us assume that the value of the balance of the depreciable assets is £50,000, that we deduct from that sum an amount of £3,000, being the recovery of depreciation, and reduce it to £47,000. If we still adopt the 10 per cent, basis, instead of getting a depreciation of £5,000 for the year, we will get a depreciation of £4,700, which means a reduction of £300 in the depreciation charge in subsequent years.

Mr Crean:

– That party would have the benefit of £3,000 immediately.

Mr HULME:

– In point of fact, there is a benefit, as against what I believe can be said to be a very serious disadvantage under the existing legislation by virtue of the fact that his income is substantially increased in that year, that because of that addition his rate of tax is substantially increased, and, overall, his total tax is increased. That is the situation, and I think that the honorable member for Melbourne Ports will agree with me. But when it comes to the deduction from the value of the balance of the assets, it means, not an additional income of £3,000 in one year, but, in subsequent years, a small improvement of £300 in relation to depreciation which does not have a material effect on the income, on the rate of tax, and on the total tax that is payable.

Therefore, I suggest that, having regard to all the facts, there is a much greater degree of equity in the proposal that is incorporated in clause 12 than there is under the act as it stands. Although unfortunately this matter is of such a technical nature that it is not easy for many people to understand it clearly, I believe it is understood by the business community and the tax agents. 1 feel that they will endorse very definitely what the Government is seeking to do by introducing this legislation. May I put it this way: There would not have been substantial representations to the committee that inquired into rates of depreciation if this were not a real problem and found to be a real problem, as I emphasized earlier, particularly in these days of inflation.

Let us look at the facts realistically. An item of plant that was bought immediately after the war for £50,000 probably cost as much as £150,000 ten years later, and the relative value of the second-hand plant would have risen proportionately.

Mr Thompson:

– It had not depreciated?

Mr HULME:

– It had depreciated, but the change of money values had to be applied to it.

Mr Curtin:

– It is only artificial.

Mr HULME:

– It is not a question of being artificial; it is necessary to sign a cheque for a substantially increased amount of tax. This has been a very real problem for the individual taxpayer, but I feel that the Government has satisfactorily met the situation by accepting the recommendation of the committee on rates of depreciation. I wholeheartedly support the provision that is contained in the bill.

Mr CREAN:
Melbourne Ports

– I am not objecting to the figures, or even the logic, of the honorable member for Petrie (Mr. Hulme), but I wish to say that logic is being applied here in one direction only, and in respect of one class of taxpayer only - namely, the taxpayer who, for reasons which he himself chooses, disposes of a particular asset. There might be some virtue in the honorable gentleman’s claim if the assets disposed of were replaced, let us say, with similar plant, but to me there seems to be no logic whatever if this is to apply, as it will, to the person who disposes of his plant but does not necessarily replace it. Of course, the honorable gentleman’s argument ignores the fact that in each of the years in which depreciation has, as it were, been over-allowed, the taxpayer concerned has got a benefit, and that those benefits greatly outweight the little bit of detriment suffered.

The honorable member cited an instance in which the value of the balance of the depreciable assets is £50,000, deducted from which is an amount of £3,000 being the recovery of depreciation, thereby reducing the balance to £47,000, and said that if we still adopted the 10 per cent, basis, instead of a depreciation of £5,000 for the year the depreciation would be £4,700, which would mean a reduction of £300 in the depreciation charge in that year which is more than offset by a reduction of £3,000 in the taxable income. All I am asking is that this committee should be perfectly aware of what it is doing when it passes legislation such as this. I would be the first to assert that the effects of inflation are very dangerous. But they are not dangerous to one section of the community only. Earlier to-night the honorable gentleman alluded to the fact that the Opposition would be moving an amendment which would mean so many millions of pounds in loss of revenue. I think the figures in the Budget show that these depreciation concessions will be worth, in a full year, £12,200,000 less tax to the business section of the community. I am suggesting that if there is any justice in the community, one section should not be getting more than it deserves simply because its representations have been made to a committee. As we have pointed out here, and as the honorable member for Mackellar (Mr. Wentworth) has pointed out, this is a piecemeal approach whereby you may correct an anomaly and do an amount of justice to one section, but it will be perhaps at the expense of the community generally.

Clause agreed to.

Clauses 13 to 16 - by leave - taken together and agreed to.

Clause 17 -

Section seventy-eight of the Principal Act is amended -

by adding at the end of paragraph (a) of sub-section (I.) the following subparagraphs: - “ (xxx) the Industrial Design Council of Australia.”.

Sir WILFRID KENT HUGHES:
Chisholm

.- I move-

That the following sub-paragraph be added: - “ (xxxi) the Australian Olympic Federation Appeal Fund for the purpose of sending Australian teams to Olympic Games.”

I said a few things in support of the amendment when, during the second-reading stage, I foreshadowed moving it.I still hope that the Government will reconsider this clause and that honorable members will support the amendment. Is there any member who does not agree with the amendment? If so, I should like to hear him say why. I doubt if there is any member here who thinks that there is anything more worthy of inclusion in this provision, after the evidence that they had at the Olympic Games just one year ago. I know that the various national trusts are important; but they are preserving bricks and mortar. I do not criticize their inclusion as beneficiaries under this measure, but is it not more important to do something to assist the John Landys, the Shirley Stricklands, the swimmers and the rowers of the rising generation instead of the old relics? We should help the rising generation who not only assist in promoting peace and goodwill among the nations that attend the Olympic Games - 67 nations last year and probably more at the next Olympic Games - but who also teach others, by their example, self-discipline, fitness and the creed that the game is worth something beyond the prize, to use an old phrase. They teach teamwork and how to co-operate and work together to achieve ever higher standards. I ask the committee, and I ask the Government, at this stage of our history, with the memory of the last Olympics fresh in our minds, not just to give my plea consideration at another time but to consider it now.

The Melbourne Cricket Ground obtained about £300,000 in cash as a result of the Olympic Games - £100,000 for the stands, £150,000 for the levelling of the groundand that is probably a low figure - £36,000 for rent and £40,000 in subsidies from the 25 per cent. discount on members’ tickets. I do not criticize this sum for one moment. Good luck to them! The Government obtained nearly £200,000 in direct and indirect taxes as a result of the games. Twenty thousand tourists visited the games, and the Commonwealth Statistician’s Office reckons that they brought in £2,000,000 more money this year than came in with tourists the previous year. The actual figure is £2,500,000, but I knocked off £500,000 since that amount might be a normal increase. The Federal Government’s post office revenue, including that from the sale ofstamps, probably did not equal the total expenditure, but we have to consider the indirect results achieved in publicity for Australia, international goodwill, and Australia’s reputation abroad, which was enhanced considerably by the games. That is good value for whatever was expended,

I take this opportunity to thank every member of this House, on behalf of the organizing committee, for what they did and for the support they gave us. It was magnificent. But now I ask that the only people who got nothing out of the games - the amateur athletic associations, and not just in Victoria, because the teams came from all over Australia - should receive some consideration and some help. The team that goes to the Olympic Games in Rome will be representative of every part of Australia. Why should these amateurs have to do as many of them did at Helsinki - put their hands fairly deeply into their own pockets in order to raise Australia’s reputation abroad? The Olympic team is the only team which goes abroad which does not get anything out of gate takings. We hoped to make £200,000 out of the promotional side of the games. If we had not paid the taxes, as was the case with the London games in 1948, and if we had not lost at least an extra £50,000 due to the international tension caused by the Suez decisions, which were government decisions and not decisions of the organizing committee, we would have made more than £200,000.

Please do not think that I am criticizing anybody. It was the support of every member of the Federal Parliament, the State parliaments and the Melbourne City Council, and of the people of Australia that made the games a success.I am grateful, on behalf of the organizing committee, for what all these people did, but I am making the plea for the people who do the real work and who each spent an average of £40 of their own money for the honour of officiating at the games. These people now have to raise £100,000 to send a team to the next games. They cannot raise it through a lottery, and have to get it through direct giving. Surely the Government and the people of Australia will agree that at least this activity should be placed on the same basis as the Elizabethan Trust, the Sydney Opera House and the Sidney Myer Music Bowl. The effect of the Sidney Myer Music Bowl is almost microscopic, however excellent it may be, compared to what the Olympic Games do for the youth of this nation, for the peace and goodwill of the world, and for Australia’s reputation and publicity abroad. The Lawn Tennis Association of Australia makes a big profit out of its share of gate money at the Davis Cup. Good luck to it. Even nations contending in the British Empire Games get a certain percentage of the gate money. But the Olympic Games stand on their own; I have never mentioned the Olympic Games in this chamber before and the organizing committee is about to disband. I wish my last mention of them to be in connexion with the plea that I am now making to the Government, so that the teams can be raised for Rome. Of course, to a great extent it is partly a matter of psychology, and people will be more ready to contribute if the concession is granted. But does any one believe that, in the absence of this concession, the organizers will be able to raise £100,000, without the greatest difficulty? I ask that my amendment be accepted in recognition of the fact that our amateur sporting bodies have made possible one of the greatest events in Australia’s history.

Mr CALWELL:
Melbourne

.- I support the appeal made by the honorable member for Chisholm (Sir Wilfrid Kent Hughes). The applause which comes from my colleagues shows that we have a keen appreciation of the merits of the honorable member’s argument. The Treasurer (Sir Arthur Fadden) is present to-night.

Sir Arthur Fadden:

– He is always present!

Mr CALWELL:

– But he is not omnipresent. His duties sometimes take him to the Cabinet room, or to receive a deputation, so he cannot always be in this chamber. Now that he is here I ask him to do what was so often done many years ago in this Parliament - allow this to become a real committee debate. If the Government is impressed by the merit of an argument, let it accept a suitable amendment, irrespective of who moves it. I know that, in the days of the Curtin and Chifley Governments, I was myself an offender, in not giving way when I might well have done so graciously, and quite properly.

The Government, just because it has the numbers, should not disregard the very eloquent appeal of the honorable member for Chisholm. I know that the Treasurer - despite his reputation in many quarters - has a generous heart. Indeed, on one occasion in the Great Hall of the University of Sydney, he responded to an appeal by Professor Messel by offering £50,000 without batting an eyelid. He believed Professor Messel’s argument and that the study of cosmic rays possessed some merit. However, this amendment has nothing to do with cosmic rays. Cosmic rays have as much to do with nuclear physics, as plant pathology has to do with pleuro-pneumonia in cattle. I shall not pursue that line of thought further.

To-night, the honorable member for Chisholm has recited the glories of the Olympic Games of twelve months ago in Melbourne. It was an Australian festival, an Australian victory, and we shall certainly strike an anti-climactic note if, after last year’s splendid parade of young Australian men and women, we send only a small body of athletes to represent us in Rome.

The honorable member for Chisholm was the distinguished chairman of the organizing committee. I was a member of the executive committee of that body and know the great work that was done by the amateur organizations. I know the self-denying spirit in which they approached all their problems. I know the spirit of selfnegation which activates them at all times in matters affecting amateur sport. I also know that, for the last twenty years, when an Australian team has been sent aboard, and insufficient money has been available, at the last minute the Prime Minister of the day has been appealed to, and has always made a donation. That could happen again, but it would be far better if the Government could, as it were, make a donation in advance by granting this concession, thus allowing gifts to the funds of the Olympic Federation to become an allowable deduction for income tax purposes.

Not the wealthy people, who pay 10s. in the £1 taxes, but the small man who would get a remission of only one-third or onefourth of the donation, will be involved. As the honorable gentleman has said, the Government made such a splendid contribution to the success of the last Olympic Games, that it might well grant this concession in order to help our boys and girls to represent us worthily in Rome. I might say that the last Labour Government was prepared to back the holding of the Olympic Games in Australia to a very large figure. I know this, because Mr. Chifley told me himself.

Our athletes are our best ambassadors, -and if they can perform as well in Rome as they did here, they will bring additional glory to the nation. I believe that the Treasurer is impressed by the case that the honorable member for Chisholm has so eloquently presented. After eight years in office, the Treasurer could do nothing that would please the people more than accept the proposal of the honorable member.

Mr HULME:
Petrie

.- I appreciate the sentiment which causes the mover to bring this amendment before the committee. I was fortunate enough to see a good deal of the Olympic Games in Melbourne. There is no doubt that the games greatly helped to build up Australian prestige overseas. They brought to Australia many important benefits which no honorable member could describe in the few minutes available to us. One cannot doubt the extent of the work done by the organizing committee. Nor can one, after a casual glance at the proposal, reject the amendment as unreasonable.

However, I ask the mover of the amendment whether an application on the subject has ever been made by the Olympic Federation to the Treasurer, or to the Commissioner of Taxation. I think one is entitled to ask that. If an affirmative reply is not given, one may assume that an application ‘in the normal manner was not made. In the circumstances, I believe that this is not the appropriate time to consider the matter.

I have been a member of this Parliament for eight years and have received many applications seeking income tax deductions in respect of gifts of a charitable nature, or for educational purposes. I also have the privilege of being a tax agent, and have known many cases in which donations to charitable and other bodies have been disallowed as deductions from taxable income. I do not intend to describe those bodies to-night, but I assure honorable members that they are just as worthy of this concession as is the organization in respect of which the amendment has been moved to-night. I believe that both the Taxation Branch and the Treasurer receive hundreds of applications by organizations for concessions of the sort set out in this amendment. All these applications have to run the gamut of analysis by the Commissioner of Taxation. The detailed analysis given by the Commissioner could not be undertaken by honorable members during the few minutes that a proposal such as this is before the committee. Having regard to all the factors, and to other requests which have been made for like assistance, if a proposal such as this were included in amending legislation introduced by the Treasurer I would be very happy to support it. However, I am not prepared to support such an amendment brought before us by means of a motion, because for 20 or 30 years it has been necessary for me, in my capacity of a tax agent, to make representations in a particular way. Just because this request comes from the Olympic Federation, and the Olympic Games were held in Australia last year, I do not think 1 should accept the amendment on the spot. I am not prepared to do so, and I feel there is justification for any other honorable member to decide on these premises not to accept the amendment that has been moved by the honorable member for Chisholm.

Mr CURTIN:
Smith · Kingsford

– I am bewildered by the attitude of the honorable member for Petrie (Mr. Hulme). For the last three years he has been chairman of a committee which has examined all types of applications for taxation exemptions. Not very long ago, the committee of which he is chairman furnished a report that recommended that an amount of £41,000,000 be handed back to big business in the form of depreciation allowances. The committee also recommended a reduction in direct taxation. The honorable member for Petrie made his appeal to the Parliament as a non-party man. “ I am always a non-party man “, he said. That is the smokescreen behind which he hides.

I support fully the amendment that has been moved by the honorable member for Chisholm (Sir Wilfrid Kent Hughes), but the honorable member for Petrie has come out in his true colours as a good old party hack striving for a place in the Cabinet. He says that Her Majesty’s Parliament should go cap in hand and request the Commissioner of Taxation to allow this exemption. Why should we go to the Commissioner of Taxation? We should direct the commissioner as to his duties. It is not really remarkable to see honorable members opposite, especially the honorable member for Petrie, championing the cause of big business.

We have many remarkable people in Australia, including our great athletes who won gold medals at the Olympic Games. The scene at the games was something that will live long in the memory of those who were present. The honorable member for Chisholm must be complimented on the fine work he did as chairman of the committee responsible for the organization of the games. Betty Cuthbert and girls of her type, and boys of the type of our champion swimmers - Jon Hendricks and others - had to go cap in hand to the brass hats of the athletic association. If they had turned professional they could, of course, have earned thousands of pounds, but having gone to the brass hats these athletes were offered the magnificent sum of 5s. a day for expenses! While we are debating this matter we should have something to say about the brass hats who are in control of the amateur athletic federation. I do not agree with the sentiments of the honorable member for Chisholm in this regard. I condemn the action of the brass hats who had the temerity to offer to the young people who created such wonderful publicity for Australia, and who gave such magnificent performances, such a paltry sum. It was an insult to those people to offer them 5s. a day for their expenses.

The CHAIRMAN:

– Order! The subject being canvassed by the honorable member is outside the scope of the amendment.

Mr CURTIN:

– I only wanted to develop that argument in order to answer the remarks of the honorable member for

Chisholm in regard to the athletic association. The matter under discussion is the Olympic Games and that, of course, embraces the next Olympic Games to be held in Rome. I hope that our champions will be present in Rome, and I also hope sincerely, for the sake of our champions, that some of the brass hats of the athletic association will be absent. Getting back to the amendment, 1 think that the taxation exemption sought is for a very worthy cause. It is time that this subject was debated in the National Parliament, because Australia as a nation has proved itself in the realm of sport. That was demonstrated in Melbourne by the manner in which hundreds of thousands of people gave vent to their feelings when gold medals were presented to Australia’s bonny boys and girls.

Sir ARTHUR FADDEN:
McPhersonTreasurer · CP

– Nobody is more appreciative than I am of the value of the Olympic Games and of what those games did for Australia. However, I should like to say that the Budget has been accepted by both Houses. The ink, so to speak, is hardly dry on the document. The legislation connected with the Budget is well known and accepted. No provision was made in the Budget for extra allowances for gifts other than those that were specified.

Mr Curtin:

– Why does not the Treasurer become a little unorthodox?

Sir ARTHUR FADDEN:

– If I were like the honorable member who has just interjected I would be unorthodox all the time. The Government has received requests from a wide variety of organizations and institutions for gifts to those institutions to be allowable deductions for income tax purposes. As a matter of blunt fact, I do not think there is an honorable member in this House who has not approached me with a request that gifts to institutions of various kinds should be classified as allowable deductions. My opinion is that from a national point of view a gift is more worthwhile if it is given without regard to its being an allowable deduction, but the position has developed in Australia that nobody will give or contribute to any organization or institution unless the gift or donation is an allowable deduction for income tax purposes. In the first place the donor, as well as receiving great credit for it, very often receives an allowance to the extent of 10s. in the £1, but in the ultimate the taxpayers of Australia contribute towards that allowance and deduction without getting any credit whatsoever. I pay tribute to the honorable member who has brought up this matter because nobody did more for the success of the last Olympic Games than he did But I point out that the Government is not unmindful of the great value to the community of athletic organizations such as the Olympic Games Federation, and since it has been in office it has exempted from tax the income of non-profit bodies which have been established for the encouragement or promotion of games and sports. Moreover, the Commonwealth made generous contributions towards the cost of the recent Olympic Games in Melbourne. An amount of £1,200,000 was contributed towards the capital outlay necessary, and in addition, the Government has joined with the State of Victoria in underwriting the loss which resulted from the games involving further assistance of up to £150,000. Furthermore, during the course of the games the services of the staffs of a number of Commonwealth departments, particularly the Defence Department, were made available to the committee free of charge. This action demonstrated in a very real sense the assistance and support which the Government is prepared to give in encouraging participation by Australians in the great Olympic movement.

Having in mind the many other deserving funds and institutions which have requested similar treatment, however, I personally would leave the matter of gifts to the Australian Olympic Federation Appeal for consideration in order of priority with other claims for income tax concessions. I promise the enthusiastic and conscientious honorable member that I will give consideration to the merits of the case in the next review of the Income Tax and Social Services Contribution Assessment Act.

Sir WILFRID KENT HUGHES:
Chisholm

– I thank the Treasurer (Sir Arthur Fadden) for his remarks, but I am sorry to disagree with him. In a Budget of £1,200,000,000, a concession of £25,000 for each of four years, or a total of £100,000, would be negligible. If like the pay-roll tax it had an effect on the Budget of several millions of pounds, I would agree with the Treasurer, but I do not think his argument is tenable. I admit quite candidly, as I have already said, that Australians appreciated very warmly the generous contribution that the Government made, but the amount of £1,200,000 mentioned was for construction. I do not suppose very much of that will be lost because we still have the residual assets at Olympic Park, which have been taken over by the trustees, and interest and sinking fund payments will be made. The £1,200,000 was not a gift.

The Treasurer told us that the Olympic committee could control construction, and I said, “ No, I would far rather have a committee of businessmen doing it “. We had Treasury officials on every one of our finance committees. They supervised, and had the right to object to any of our expenditure. They did a magnificent job, and I cannot yet understand why only Treasury officials criticized us after the conclusion of the games because we did not make a profit on the promotional side. But we had to pay nearly £200,000 in tax, and we lost £850,000 as a result of international tension at the time. I admit the Olympic Village might have been a bit lavish, but if the buildings had not been provided their lack would have given rise to widespread complaints at the outset and the games might have been a failure, o

I am sorry to disagree with the Treasurer. I point out to the honorable member for Petrie (Mr. Hulme) that this matter has been raised on several occasions. I do not think he was in the House when I mentioned that I had asked that a trust fund of £200,000 be established. However, the Treasury turned down that proposal, too.

Mr LUCHETTI:
Macquarie

.- I support the amendment that has been moved by the honorable member for Chisholm (Sir Wilfrid Kent Hughes). In doing so I cross swords with the Treasurer (Sir Arthur Fadden) when he says, in effect, that we are wasting out time in considering amendments because the Budget has been received, debated and determined. In the first place, that attitude ignores the very essence of our parliamentary institution and democratic system of government. The Treasurer certainly acted in bad taste in stating the Government’s case in such unfortunate language. In any event the Government should not regard itself as being immovable and say that the committee is not entitled to consider this matter. The determination of it really rests with the committee. I direct attention to the Treasurer’s Budget speech delivered on 3rd September. Dealing with gifts, he said -

It is proposed to widen the scope of the income tax concessions for gifts to include certain cultural and industrial research organizations.

He then set out the types of organizations which would derive benefits, and added -

The revenue cost is estimated at £157,000 in a full year, but there will be little or no cost in this financial year.

If that is so, what is to prevent the committee this evening, in spite of what the Treasurer has said, from accepting the amendment proposed by the honorable member for Chisholm and taking a course which I feel would win the approbation of every patriotic Australian? What are the criteria by which deductions are approved? What is the yard stick? What must an organization do? Could anything be more laudable than to send an Australian team of athletes to a foreign country where they would act as our ambassadors and uphold our traditions as a sporting nation? Would that not be a good investment measured by any standard? Must we be committed for all time solely to a diplomacy which involves members of the Government making periodic pilgrimages overseas?

The proposal made by the honorable member for Chisholm will uphold the national spirit of Australia. It is most worthy. There is no appeal more deserving of consideration than the Olympic appeal. Cannot the Government which helped to make the Olympic Games in Melbourne such an outstanding success in bringing credit to Australia and its people, in interesting overseas investors and others in the possibilities of this land and at least giving them a healthy respect for Australians as a sporting nation and fair-minded people, still further enhance that success by sending overseas a worthwhile representative team of athletes? When one considers that the money necessary to send teams overseas must be raised by difficult processes of collection and through amateur athletic carnivals, from which very little or no profit is derived, it is only reasonable to suggest that the Govern ment, fired with the Spirit of Australia and the desire of maintaining Australian traditions and credit abroad, at least in the sporting field, should not hesitate to accept the amendment.

Why is the amendment to be rejected? Is it because the honorable gentleman from Chisholm so successfully organized the Olympic Games in Melbourne? I do not know, but I hope that this matter will not be dealt with on a personal basis. Of all the causes deserving of the support of the Parliament, I can think of none more deserving of support than the appeal for funds to send our athletes abroad. The Treasurer has made clear that although the loss of revenue by the exemptions proposed in this clause will amount to £157,000 in a full year, only a small part of that amount will be required for the remainder of this year. So, his assertion that funds would not be available for the purpose suggested by the honorable member for Chisholm falls to the ground. The Treasurer should revise his views on this subject and accept the amendment which has been so worthily moved by the honorable member for Chisholm. I am delighted to support it and I am sure that all Opposition members will be glad to join me. I hope that those Government supporters who regard themselves as good Australians and sportsmen will join us on this occasion in supporting the amendment.

Question put -

That the amendment (Sir Wilfrid Kent Hughes’s) be agreed to.

The committee divided. (The Chairman - Mr. C. F. Adermann.)

AYES: 34

NOES: 54

Majority . . . . 20

AYES

NOES

Question so resolved in the negative.

Clause agreed to.

Clause 18- (1.) Section eighty-two B of the Principal Act is amended by omitting the table in sub-section (2.) and inserting in its stead the following table:-

Mr CREAN:
Melbourne Ports

– As indicated at the second-reading stage, the Opposition proposes to move an amendment for the purpose of increasing the allowance, in respect of the spouse of the taxpayer, by £13, that is, from £143 to £156, and consequentially, if the amendment is carried, to increase also the figures in clauses 19 and 20 from £143 to £156.

As has been stated already, this amendment does not mean that we are satisfied that £156 is an entirely adequate sum on which to support a wife; it is being moved merely to indicate the inadequacy of the amounts that are being allowed by the Government.

The Treasurer (Sir Arthur Fadden) indicated in his Budget speech that it is expected that, in a full year, the concessions that he proposes to bestow by increasing the allowances for dependants by £13 all round, will mean a cost to revenue of £7,700,000, in this financial year, and of £8,425,000 in a full year. By way of contrast, the Opposition points to the completely inadequate treatment that is being given in respect of these allowances which affect every family in the community, compared with the sectional depreciation allowances, in respect of which the benefit in a full year, to one section of the community, will be £12,200,000.

I agree with the honorable member for Mackellar (Mr. Wentworth) that this piecemeal approach is not sufficient, and that what we need is a full and comprehensive review of the income tax structure, with a view to granting greater allowances for all dependants. The logic of the approach of the Government to this question seems to be that it is possible to keep a wife for £2 15s. a week, the first child for £1 15s., and the other children for £1 5s. Even allowing for child endowment, those figures are most unreal in terms of prices as we know them in 1957. The time has come when a concessional deduction, if it is to be real. should have some relation to the actual cost of keeping a dependant. Because honorable members on this side of the chamber think that the proposed deductions will still be inadequate, as a token of our opposition, I formally move the following amendment: -

In Clause 18, omit the figures “ £143 “ (twice occurring), from the third column of the table, and insert the figures “ £156 “.

I trust that the amendment will receive the favorable consideration of the committee.

Mr CRAMER:
Minister for the Army · Bennelong · LP

– The Government is not prepared to accept the amendment.

Question put -

That the amounts proposed to be omitted (Mr. Crean’s amendment) stand part of the clause.

The committee divided. (The Chairman - Mr. C. F. Adermann.)

AYES: 58

NOES: 30

Majority . . . . 28

AYES

NOES

Question so resolved in the affirmative.

Amendment negatived.

Clause agreed to.

Remainder of the bill - by leave - taken as a whole, and agreed to.

Bill reported without amendment; report adopted.

Bill - by leave - read a third time.

page 1911

ESTATE DUTY ASSESSMENT BILL 1957

Second Reading

Debate resumed from 5th November (vide page 1813), on motion by Sir Arthur Fadden -

That the bill be now read a second time.

Mr CREAN:
Melbourne Ports

– The Opposition does not intend to say a great deal about this measure. There would be, I think, general agreement that for the purposes of estate duty the definition of “ children “ should be widened to include stepchildren and ex-nuptial children, and, in general, children for whom a person has accepted full legal parental responsibility. Under existing legislation, bequests to adopted children or children born out of wedlock are treated differently, for the purpose of probate, from those left to other children, and, in some cases, they attract duty at a higher rate. This bill proposes to correct that anomaly. It also proposes to provide relief in another class of case. I refer, by way of example, to an estate left by an elderly husband to an ageing wife, who dies within a short time after the death of the husband. In effect, the husband’s estate in such a case attracts duty twice at the full rate. The bill modifies those provisions by abating the amount of duty payable on the deceased wife’s estate by 50 per cent. if she dies within twelve months of the death of the husband, by 40 per cent if her death occurs within two years, and by lesser proportions if she dies at some later time. The concession is no longer available if she outlives the husband by five years or more.

These provisions seem reasonable to us in all the circumstances, and, therefore, we propose to offer no opposition to the measure.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1911

GIFT DUTY ASSESSMENT BILL 1957

Second Reading

Debate resumed from 5th November (vide page 1813), on motion by Sir Arthur Fadden -

That the bill be now read a second time

Mr CREAN:
Melbourne Ports

– This bill makes the same kind of amendment with respect to gift duty as was made in the case of estate duty by the legislation with which we have just dealt. The legislation refers to gifts or settlements made in the course of a lifetime, and its purpose is to amend the definition of “ children “ in the same way as it was amended in the legislation dealing with estate duty. It also proposes, in cases in which two gifts attracting duty are made within a very short period of time, to abate the amount of duty payable on the second occasion similarly to the way in which relief was provided in the case of estate duty.

There seems to be no new principle involved in the legislation. I do, however, make a similar plea to the Government to that which we made during the debate on the income tax legislation. These are really complicated measures, and we should have been given more information about them. The Treasurer (Sir Arthur Fadden) mentioned in his second-reading speech that the Government had examined comparable systems in other parts of the world, that it had seen the evils and benefits of the various systems, and had eliminated the vices and included all the virtues in this legislation. It would be appreciated if we were given a little more of the background when such measures as these are introduced. I might also suggest that these bills could be introduced earlier, so that we would have a little more time in which to consider them. Both this measure and the one that we have just disposed of were introduced into the House only yesterday. While these two measures do not involve any important questions of principle, nevertheless I think it is unsatisfactory that legislation should be passed quite so rapidly.

Mr DOWNER:
Angas

.- I do not wish to detain the House unduly, but I would like to take the opportunity of saying a few words about this bill and the act which it is proposed to amend. One is grateful, of course, for any amelioration in an impost of this sort, and so, naturally, we on this side of the House support the measure. But I feel I must take the opportunity of saying in passing that the principal act is a bad piece of legislation, and I regret that the Government is continuing it. Unfortunately in a sense, it is, I understand, one of the babies of the Treasurer (Sir Arthur Fadden). It was conceived by him and the late Mr. Chifley in 1941, when the right honorable gentleman was much younger, less versatile and not so experienced. I can understand that, having helped to bring the child into being, he would have some feeling of paternalism and fidelity towards it, even though it has a pronounced strident socialist shriek.

The whole conception of gift duty can be assailed on several grounds. It is a tax on human generosity, on family life and on the continuity of families. A man may wish to endow his children in his lifetime. He may want to purchase a farm for a son. He may wish to set up another son in a business. He may wish to help to establish another son in a profession or some other kind of a vocation. I imagine that there is nothing anti-social about such desires. On the contrary, to all reasonably thinking people, they are practical and morally sound. Surely it is wise for a parent to guide his off-spring in the management of money during the parent’s lifetime. This is a more practical procedure than to let the off-spring wait until the parent dies, and then, through the devolution of the estate - or what is left of it after the Treasury has had its share - accept the full responsibility of conducting the estate without the father’s advice and guidance. The effect of this gift duty legislation is to discourage donors by what amounts to a very stiff tax. Again, the question often arises that a husband may wish to present his wife with some share of his fortune. If he is a wise man he will know that the greater her degree of financial independence, the happier is the marriage likely to be. There is nothing so embarrassing to a woman as to be always asking a man for money; and if honorable members opposite are truthful and are really men, they will realize that few things are so humiliating to a husband as always to have to refuse his wife’s request for money. However, this legislation has little room for such refinements of feelings. Under its terms, once a gift amounts to £2,000 it attracts tax and many people, of course, would think twice before sharing their accumulated savings with others.

I am, of course, aware of the arguments underlying this measure. As I understand them, they arise, in the main, from a Treasury fear that people will part with large chunks of capital during their lifetime and so avoid death duties. This is probably hardly the occasion to indulge in the ageold controversy as to the propriety of estate and succession duties, although members on this side of the House realize that such duties rank high in the fiscal affections of honorable members opposite. But against the belief that people will make large gifts inter vivos, I suggest there is a measure of natural reluctance in many people to part with the control or ownership of their capital. So far as gifts to children are concerned, there is always a very real feeling of uncertainty as to how the children will use them once they acquire possession of them. There is the possibility, also, that the donee may predecease the donor or, indeed, that the donor himself might die within three years of making the gift and, in that event, under existing legislation, death duties are not avoided.

Mr Cairns:

– Why does not the honorable member do something about it?

Mr DOWNER:

– I wish the honorable member with his advanced socialist theories would be a little more tolerant and not nestle in the web of his Marxian ideas. To honorable members on this side of the House, it becomes increasingly boring to hear his old academic stuff trotted out session after session. It has so little relevance to the kind of Australia that we hope to build. The truly philanthropic person is not always actuated by these calculated considerations when he contemplates his wife, his son, a struggling relative, or old friend in distress, or some deserving charity; but many people are impeded, to the point of discouragement, by the nature of this tax.

I wish to bring another objection to the notice of the House. It is this: The Government has paid insufficient attention to the incidence of gift duty. Let me remind honorable members briefly, in outline, of the history of this tax. As I said earlier, it was first introduced in 1941 and was fairly sweeping in its operation, being applied to gifts of £500 and upwards. Six years later, in 1947, the then Treasurer, Mr. Chifley, extended the limit to £2,000. Honorable members will agree that such an action by a man with great honesty of mind and intention but who, nonetheless, was an avowed socialist, represented a notable concession. But ten years have passed since 1947 and, so far as I am aware, the limits of this exemption still remain. I, for one, do not see how the Government, in equity, can defend this inaction. It is trite to say nowadays that if you compare the value of money in 1947 with its value to-day, taking a conservative estimate, it must be agreed that the purchasing value of the £1 is only about half of what it was ten years ago.

Mr Edmonds:

– You are kidding yourself. It is only about a third.

Mr DOWNER:

– Honorable members opposite shout and say, “ Hear, hear! “, but they are only applauding a world-wide phenomenon because inflation is not confined to this country. They have only to read the latest Treasury bulletin to see how widespread it is elsewhere. We know, and we admit if we are honest, that it is the price we are paying for our rapidly expanding national economy. However, I do not want to be sidetracked. If we consider the decline in the value of money since 1947 and its effect on this particular piece of legislation we have to come to the conclusion that the burden of gift duty is, at the very least, double what it was ten years ago when the exemption limit, was raised. I put it to the Government that if Mr. Chifley thought it fair, in 1947, to exempt from duty gifts of up to £2,000, the case is surely now overwhelming to bring this limitation up to date. Applying the yard stick of purchasing power, I suggest to the Government that the exemption limit to-day should be £4,000, not £2,000.

Mr Ward:

– Why do not you do something about it?

Mr DOWNER:

– That is the object of my plea.

Mr Ward:

– Did you raise it in the party room?

Mr DOWNER:

– Perhaps if the honorable member would listen a little more carefully he might be able to discern the tenor of my speech. My own preference, as 1 have indicated earlier, would be to see this tax abolished. As a source of revenue to the Treasury, it brought in, according to the Budget papers, £1,940,324 last year. The estimate for the current year - 1957-58 - is a little higher, but it is only £2,100,000. Sir, those are small sums in a Budget of something over £1,300,000,000!

I have already given to the House the reasons why I consider gift duty is bad public policy. However, should the Government desire to nurture this ungainly project, partly of its own creation in times past, I would urge the Treasurer at least to clothe it with respectability by reviewing the whole incidence of gift duty in his next Budget. Justice, wisdom, common sense, and, on this side of the House, adherence to Liberal principles, all clamour for a revision of this tax in accordance with the changed value of our money to-day.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 1914

ADJOURNMENT

Australian Content of Television Programmes - Television Session “Meet the Press “ - Communism - Censorship - Internment of Aliens.

Motion (by Mr. McMahon) proposed -

That the House do now adjourn.

Mr CAIRNS:
Yarra

.- I desire to draw attention to a matter raised by the Postmaster-General (Mr. Davidson) in the House on 24th October last when he read a telegram from the television station ATN making an offer to Actors Equity of Australia to produce television programmes in this country. The telegram reads -

Further reference my telegram yesterday regarding the use of local talent in television programmes, we are willing to present a ‘half hour dramatic or musical programme supplied by Actor’s Equity and pay them a fee of £300 a performance for two hours, which we believe is the maximum price obtainable from any advertiser.

The telegram went on to apply another condition, which was that the programme would have to acquire a 50 per cent, rating when put over television station ATN. The impression has been given that this offer to Actors Equity was generous and would contribute much to the solution of the problem in respect of the presentation of very few Australian programmes of drama.

I wish to point out to-night that this offer has been considered by Actors Equity, and that there are quite a number of points that should be put to the House and the Minister. One of them is contained in a letter to the Minister from Mr. Alexander, general secretary of Actors Equity. I quote directly from it as follows: -

For your information, this union is not a producing unit of films and entertainment, and the employers know very well that there are many units available which could speedily and quickly produce any performances which the licensees have in mind.

The letter continued -

If ATN is really interested, however, I can give them the names of some six or seven production units in Sydney which will make programmes for them, based of course upon the award rates, insofar as costs are concerned, and I refer to the award obtained by the employers at their instigation.

The next point to which I desire to draw the Minister’s attention is that the requirement of a 50 per cent, rating for this programme is a very difficult condition to apply in an offer and makes this offer far from generous. Again I refer to the letter from Mr. Alexander -

It is notable however that among the conditions which station ATN has placed in its offer is one which means in effect that after a few weeks, the programme to be produced by my organization would have to have a minimum of 50 per cent, of the viewers as its audience. This would mean that although five stations were on the air at the time the programme was being transmitted, at least half of all of those viewers would have to watch this programme of ours on ATN. If ATN based its existing programmes on this basis ATN would be in the following position: - on Tuesdays ATN would not show at all until 9.30 p.m. because up to that time it has no programme with a 50 per cent, rating of the viewing audience. At 9.30 p.m. on Tuesday ATN moves to 50 per cent, of the audience with the Australian show “ In Sydney To-night “. On Wednesday based on this 50 per cent, viewing audience, ATN would not go on the air at all as none of its programmes are getting a 50 per cent, rating.

Yet one of the requirements in what is called a generous offer is a 50 per cent, rating! The letter goes on -

On Thursday no ATN programme rates 50 per cent, of the viewers before 9 p.m. On Friday not until 9 p.m. On Saturday none at all, and on Sundays only between the hours of 8 and 9.30 p.m.

I point out to the House that there are only six television programmes in Australia in

Melbourne and Sydney with a 50 per cent, rating. This puts the offer well beyond the limits of a reasonable one.

The next point to which I wish to refer is the question of cost. The offer in the telegram was most ambiguous, and I should like to draw attention to it. The offer says -

We are willing to present a half-hour dramatic or musical programme.

Some people have drawn -the conclusion that the offer was £300 for half an hour, but the telegram goes on to say -

And pay them a fee of £300 a performance for two hours.

Presumably, a fee of £300 for two hours would work out at £75 for half an hour. If this is so, it is quite clearly a cost which is far less than can be achieved.

As to costs - and it is, I think, most important that the House should know this - there is some evidence in a letter from Sir Arthur Warner, managing director of the Melbourne station GTV, to the Victorian secretary of Actors and Announcers Equity Association of Australia. One sentence of that letter reads -

Our present cost of a half-hour play is approximately £50.

That cost, of course, is based upon plays produced in the United States, because the Minister in an answer given to a question I had placed on notice, pointed out that station GTV did not broadcast any Australian dramas. Therefore, £50 as the cost of a programme for half an hour over GTV, on the authority of the managing director, is based upon the American production. This is the real problem that Australian artists have to meet. Incidentally, Sir Arthur Warner’s station is using television programmes which in America cost an average of 33,000 dollars for half an hour. A half-hour comedy variety programme cost 39,607 dollars. Some American programmes cost a great deal more than the average figure of 33,000 dollars. For example, among imported programmes which are telecast in Australia, “ Disneyland “ cost 75,000 dollars, “ Dragnet “ cost 37,000 dollars, “ Father Knows Best” cost 38,000 dollars, “Alfred Hitchcock” cost 34,000 dollars and “I Love Lucy “ cost 52,000 dollars. These programmes have cost very large sums in the United States.

The question then arises as to how it is that such programmes are able to be telecast in Australia at a cost of £50 for half an hour, if we are to take Sir Arthur Warner’s station as an example. The explanation is most important. It is that television licences in this country have come into the hands of newspaper proprietors who are conducting television stations as they conduct their newspapers. They are cutting their advertising charges to a minimum, and I understand they are running at something like £100 or £150 an hour. If they establish that kind of charge for advertising - and there is evidence that advertisers would be prepared to pay a considerably higher charge - they are conpelled to use programmes which come to them cheaply from the United States. The fact that they can put on a programme, according to Sir Arthur Warner’s statement, at a cost of £50, proves that these programmes are coming from the United States at a fraction of their cost.

This is clear evidence that there is dumping. Indeed, this dumping of American television programmes appears to be one of the most flagrant cases of dumping that have ever taken place in the history of Australian industry. Therefore I suggest that any kind of escape from this situation which is presented in an offer such as the one read in this House with some degree of pride by the Postmaster-General from Amalgamated Television Services Proprietory Limited is just a deception. There is nothing genuine about it. It is designed to create a situation which no producer of television programmes in Australia could meet, for the reasons that I have stated.

Unless this situation is dealt with at the source and unless the Postmaster-General in his position of authority, through the Australian Broadcasting Control Board, is prepared, at least, to call a conference between the parties concerned in an endeavour to protect the infant Australian television production industry in the same way as every other Australian industry has been protected, this industry will not be developed If it is not possible to take that action, I suggest that it is quite clear that there i> evidence of dumping in the few facts that I have been able to present to the House to-night in the few minutes at my disposal. There is evidence of dumping which is a serious breach of principles on which the Australian Broadcasting and Television Act isis based.

Mr SPEAKER (Hon John McLeay:
BOOTHBY, SOUTH AUSTRALIA

Order! The honorable member’s time has expired.

Mr DAVIDSON:
General and Minister for the Navy · Postmaster · CP

– The honorable member for Yarra (Mr. Cairns) has referred to an offer made by Amalgamated Television Services Proprietory Limited to Actors Equity for the televising of a programme by Actors Equity. Particulars of this offer were forwarded to me for my information by Amalgamated Television Services Proprietory Limited during the course of certain discussion in this House a week or two ago, and I quoted from them. I did so, not with the intention of setting myself up as a go-between in a matter such as this, but as an indication of the preparedness of this television company to discuss these matters with Actors Equity. I hoped that Actors Equity would confer with the television company concerned to see whether something could be done to improve the situation which we are discussing. So far as I know at present, no effort has been made by Actors Equity to confer with the television licensee. Instead, Actors Equity has written quite long letters, apparently to certain honorable members and certainly to me, as a result of which the honorable member for Yarra has made certain statements in the House to-night, quite a few of which are not entirely correct, but constitute a misstatement and a misconception of the offer made by Amalgamated Television Services Proprietory Limited.

The honorable member for Yarra said that the offer by Amalgamated Television Services Proprietory Limited was not genuine and that it was deceptive. He based that statement on certain claims, one of which was that Actors Equity has claimed in reply to this offer that it is not a producing unit, and that therefore this offer could not be sincere. But Amalgamated Television Services Proprietary Limited did not suggest at any time that Actors Equity should turn itself into a producing unit. Tn fact, the terms of the offer which I read in this House made that quite plain. It will be remembered by honorable members that the offer, apart from stating the amounts that the company was prepared to pay to

Actors Equity, also stated that all costs from the camera would be borne by the television company. All that was required of Actors Equity was that it should make some effort to produce a programme of some sort and then come to the station prepared to confer with the company which would do all the technical work necessary in order to put the programme on.

Mr Cairns:

– That is not what Actors Equity said.

Mr DAVIDSON:

– Actors Equity sent me a copy of the letter that the honorable member for Cairns has quoted from, so I know what is in it. Actors Equity claims that it is not a producing unit. It seems to me that Actors Equity, having been provided with an opportunity to show its sincerity in wishing to provide Australian programmes - an opportunity that I thought would be gladly accepted - is getting out from under by saying, “ How can we do that? We are not a producing unit.” Actors Equity is not required to be a producing unit. If it will discuss this matter with the licensee, it will find that the licensee is prepared to discuss matters such as this and iron out any initial difficulties that may be seen. The company’s offer was not ambiguous. It was quite plain. It would involve the company in costs amounting to at least £100 per half hour, and would also embrace the production costs including studios, lighting, and camera crews. All that would be required of Actors Equity would be to produce the people and put the programme on.

I rather dislike speaking on behalf of one licensee because I believe that all licensees are imbued with the same desire. But this is a particular case, and that is my excuse for mentioning a particular company. As an example of the desire of licensees to develop the Australian content of programmes, this company, three months ago, commissioned a local production unit to commence production on a minimum of 156 fifteen-minute dramas, employing entirely Australian casts. The programme ideas were developed by the television licensees and the production unit has now made the first two episodes and is preparing to audition those two episodes to the company next week. Here is an example of the company trying to work in with the production unit and with the artists for the purpose of putting on an Australian programme.

Another criticism offered by the honorable member for Yarra on behalf of Actors Equity referred to the condition that after a certain period of time, if an impartial survey disclosed an audience of 50 per cent., then further offers would be made and the artists would be given engagements over a considerable period. It has been said by Actors Equity that that is an unattainable mark. Amalgamated Television Services Proprietary Limited has pointed out that the offer did not demand that the programme should achieve a 50 per cent, rating which in fact is 50 per cent, of all sets. What that offer asked was that the programme should achieve 50 per cent, of the available audience. In the normal programme of 46i hours a week by this company, the programme for 24i hours achieves this audience or more. That is to say, more than 50 per cent, of the total programme time of the company achieves an audience of 50 per cent, or higher. That is a statement of fact which has been taken from the records of the company.

Here is another example of what can be gained by the members of Actors Equity if, instead of writing letters to members and Ministers, they will go and meet the directors and manager of this company and say, “ Exactly what do you mean by this and what is required of us? “ Then they will find out something, and they will stop writ. ing letters such as this one which achieve nothing, which are open to misconstruction, and which do not do anything to relieve this situation that I, as well as the honorable member for Yarra and other honorable members, desire to see rectified. I know that the television licensees are desirous of building up the Australian content of programmes. As I said a week or so ago, if the protagonists for Actors Equity desire to assist that body, let them co-operate with the licensees instead of writing letters to Ministers and other people. Then they will achieve something.

Mr WARD:
East Sydney

.- Yesterday I asked the Prime Minister (Mr. Menzies) a question regarding a television session in which the honorable member for Mackellar (Mr. Wentworth) participated. In order that honorable members will be quite clear about the question I asked, and the Prime Minister’s answer, I propose to read them. This was my question -

Is the Prime Minister aware that during a television session entitled “ Meet the Press “ on Station TCN, Channel 9, Sydney, on Sunday evening, 27th October last, the honorable member for Mackellar stated that he believed one or two officers in the Department of External Affairs were Russian agents, and that he had reported his suspicions to the Commonwealth Government? Will the Prime Minister say whether in fact the honorable member did submit such a report to the Government and, if so, what action was taken in the matter?

The Prime Minister, after indicating that he had viewed this television session, said -

The question put by the honorable member for East Sydney contains, I think, a distortion of what was said by the honorable member for Mackellar. He was being questioned about communism. He pointed out - very properly, T thought–that Communists did not always engage in spying, that Communist policy passed through various phases, and that at present the top-line directions favoured the dissemination of propaganda on a wide scale. He was then asked by one of the questioners whether he thought there were still spies in Australia. He said he had no doubt there were some. He was asked whether he believed there were any in the External Affairs Department. He said, as I heard him, “ Well, I don’t know. There may be one or two. I don’t know”. All this was a statement by him of a possibility. I was quite amused, next morning, to find that it had been built up into a specific allegation made by him only stopping short of giving names.

I think honorable members will be aware that it is an old technique of the Prime Minister to try to make out that members of the Opposition, when they question the Government, are distorting the facts. I have in my possession a copy of the “ Daily Telegraph” of 28th October last. The caption to the article I wish to quote reads, “Wentworth tells of his suspicions. Red spies holding Federal jobs “. The article states -

Mr. W. C. Wentworth, M.H.R., said last night he believed “ one or two “ people in the External Affairs Department were Russian agents.

He said he had reported his suspicions to the Federal Government. The Government might have taken action of which he knew nothing.

There is an easy way to find out who is telling the truth. That report in the “ Daily Telegraph “ was taken from a tape recording of the television session, and if the Government wants to prove who is telling the truth in this matter I invite it to obtain the tape recording from the newspaper. I feel sure that the “Daily Telegraph” would make the tape recording of the session available.

The Government should bring the recording here and let honorable members hear it. They will then know who asked the question. I listened to the television session, as did the honorable member for Watson (Mr. Cope), and there are hundreds of other people who could be brought forward to testify as to what was said.

The questions to which the honorable member for Mackellar replied were directed to him by the “ Daily Telegraph “ representative in Canberra, Mr. Alan Reid. The honorable member for Mackellar is always endeavouring to smear people. Unless this matter is completely cleared up, suspicion will rest on every member of the public service employed in the Department of External Affairs. If the honorable member is correctly reported - and I say that the playing of this tape recording will indicate that he is correctly reported - he said that he believes there are one or two people in the Department of External Affairs who are Russian agents, that he reported the matter to the Government, but that he was not aware of what action the Government had taken in the matter. If there are Russian agents in the Department of External Affairs, as indicated by the honorable member for Mackellar, this House is entitled to know what action the Government took in relation to the honorable member’s allegation.

It is not sufficient for the Prime Minister to come into this chamber and try to extricate his Government and the honorable member for Mackellar from a difficulty by talking about views being distorted when what has been stated is on record and can be produced. It is becoming a daily occurrence in this country for some members of the Government to declare that they have been wrongly reported, that they have not said what has been attributed to them. Only a few days ago the Prime Minister denied a statement that was contained in a man’s memoirs of his war experiences. The Prime Minister had to rush in and say that he had been wrongly reported. Day after day in this chamber we hear Ministers claim that they have been wrongly reported, and deny statements that they have previously made when they find those statements difficult to explain.

I say without any qualification that what I implied in my question to the Prime

Minister was correct. I heard the session. I have conferred with other honorable members who listened to the session. They all confirm my opinion as to the questions asked and the answers given. Our opinion of what we have stated to be the truth can be confirmed by the tape recording, if the Government is game enough to have it brought here and play it for the information of honorable members.

Mr WENTWORTH:
Mackellar

– Honorable members could not blame me if I felt a little flattered at knowing what a large audience I had on television. But I feel that the honorable member for East Sydney (Mr. Ward) is wasting his talents. He should be out at La Perouse throwing boomerangs, because in this case he has unwittingly, I am certain, done a service to the anti-Communist cause.

I have nothing to withdraw and nothing to add to what I said on television. However, there is a moral that the House might draw from this matter and from what the honorable member for East Sydney has said. The honorable member has said, quite rightly, that a certain amount of suspicion is rife in the community. If he had read the report of the Royal Commission on Espionage - and I believe he has read it - he would know that there is a good deal of justification for that suspicion, and a good deal of justification for the suspicion that Communist agents are inside the Labour party and on the personal staff of the Leader of the Opposition (Dr. Evatt). If the honorable member for East Sydney is honest he will co-operate with me in my desire to have these matters fully ventilated.

I believe that where this suspicion exists - and unfortunately events have given rise to this suspicion - it should not be enough simply to leave the matter in abeyance. I consider that we should have some organization that will perform the double function of convicting the Communist agent and clearing the person who is unjustly suspected of being a Communist agent.

It is no good pretending that there has not been, as it were, a crime committed. A body is on the floor. Somebody in the house is guilty. Until we can find the guilty person a number of innocent people will, perhaps, be under suspicion. That is what normally happens when a murder or any other crime is committed. In this case, while it is as yet impossible to sheet the guilt home to the individual, there is, unfortunately, ample evidence that treason has been committed, and, perhaps, still is being committed, in the places that I have mentioned. If that is so, honorable members of the Opposition will do an unwonted thing and co-operate in the anti-Communist cause - if, indeed, they are honest - and help in the setting up of some instrumentality which will perform the double function of convicting the guilty and clearing the innocent, because until the guilty people are found there will be, unfortunately and in the nature of things, some innocent people under suspicion.

I point out to the House that whenever in the past an attempt has been made to convict the guilty, the honorable member for East Sydney has been foremost in obstruction. He has played the game of the Communist party in this House and elsewhere. The Communist party fears exposure above everything else, and as soon as any move is made to find out who these people are, to obtain the conviction of the guilty - this is a matter of public record and not of suspicion or anything like that; it can be verified from the “ Hansard “ record of this House and from the public press of this country, which the honorable member this time quotes so unctuously and with such approval - the honorable member for East Sydney endeavours, on every occasion available to him, to obstruct the exposure of any Communist agent. When any move has been made which has involved the exposure of a Communist agent - and this happened as a result of the Petrov commission - he has done everything in his power to persecute those who have been successful in exposing Communists. So not only in prospect, but in retrospect, he has been serving the Communist cause.I do not withdraw anything I have said to the effect that the most important feature of Communist tactics at the moment is not espionage, because the things that we have in Australia, with some exceptions, are not, in the main, secrets worth getting. Two exceptions are Woomera and the top policy in the Department of External Affairs. The real tactics of the Communists in Australia are directed to propaganda, the moulding of public opinion, and the prevention of exposure of Communist agents. Judged by that criterion, there is no more effective Communist operative in Australia than the honorable member for East Sydney.

Mr O’CONNOR:
Dalley

.- Some weeks ago the matter of the action of a customs official in banning a book under certain conditions was brought before this House. I have a case which I feel should be brought to the notice of the House, and I think the best way of doing it would be to read the correspondence that I have received. This is a letter dated 25th October, 1957, from the Reverend Mr. R. S. R. Meyer, who is in charge of St. Thomas’s Church of England, Rozelle -

I am enclosing a copy of a letter which I am forwarding this day to the Minister for Customs and the contents are self-explanatory. I would be grateful for anything that you could do to support my representations to the Minister.

You can accept my assurance, if you need any, that the book contains nothing salacious or anything offensive to public morals. Indeed on the contrary many young couples in Rozelle and Balmain have spoken most appreciatively of the information which it contains. I am at a complete loss to understand why officialdom should suddenly come down on such a book. As you will understand I am loth to recommend more comprehensive books which would be both beyond the pockets and the comprehension of the majority of the people here in this electorate who come to me for marriage.

For your information, Rennie Macandrew is an English physician who has written a number of works on this important subject which are still readily available in the shops.

This is the letter, dated 25th October, 1957, that the Rev. Mr. Meyer wrote to the Minister for Customs and Excise (Senator Henty)-

Throughout most of my fifteen years as a clergyman of the Church of England I have been recommending to couples who come to me for marriage that they purchase as a marriage manual Rennie Macandrew’s “ Lifelong Love “. I have done so for two reasons -

The book is reasonably priced at about 10s. to11s. and quite readable even for those who are of a comparatively low educational standard.

It is most thorough and sound in its approach to the various problems associated with happy marriage.

However recently Dymocks Book Arcade Ltd., of George Street, Sydney, from whom I had advised the couples to purchase the book, have informed me that their most recently imported supplies had been held up in Customs by your Department and I am now informed that some ban has been placed on the book. I must say that I am amazed to find that a book that has been freely imported and sold over at least twelve years to my certain knowledge, and probably longer, and which contains no information that cannot be obtained in any number of other books, should suddenly come under the critical notice of your Department. I regret that such a step seems to have been taken personally because no other book that I know of in its price range treats the subject so adequately. If I remember correctly it contains no information on birth control and so could not come under official displeasure for any reasons connected with this controversial subject.

I would be most grateful if you could give me any information -

as to the reason for this ban

whether there is any action that I can take to appeal against such a ban, if any.

Here we have, apparently, a ludicrous situation that has arisen as a result of the policy that prevails in the Department of Customs and Excise. A clergyman has been advising people who contemplate marriage to obtain this book. It has been readily available for the past twelve years but suddenly, out of the blue, it is banned. The people who have been responsible for its sale here have been given no reasons for the banning, other than the fact that action has been taken by the Department of Customs and Excise to impose the ban. I have written to theMinister for Customs and Excise on this matter, which I think, requires some serious investigation by him. Following so closely recent actions of certain of his officials, it does appear to me to indicate that the department is in very sad need of overhaul, and I do hope that the Minister will take drastic action to ensure that this sort of thing is not permitted to continue.

Mr SNEDDEN:
Bruce

.- There are people in this country who have played a very great part in its national development. I refer, particularly, to those people of Italian origin who, generally speaking, are most industrious, hard-working people. They are also very shrewd and wise people and when on occasions certain compliments or apologies are thrown at them, with the intention that they should accept the bait and adopt as their errant knight the person making those statements, it is just too futile to be believed. Last week, in Northcote, a suburb of Melbourne, the honorable member for Melbourne (Mr. Calwell), in addressing an Italian audience, made an apology to that audience for the internment of Italian people during the last war.

Undoubtedly, the honorable member intended to encourage the Italians to give either him, or his party, their votes at future elections.

There were some extraordinary features of the meeting, Mr. Speaker. It is reported in the press that the honorable member broke into the Italian language, and that his remarks in that language were accompanied by loud applause from his audience. I have heard the honorable member speaking Italian, and I cannot understand how his audience could applaud him, unless it was merely in acknowledgment of his effort, because I am sure that his remarks in Italian would not have been understandable. The honorable member said that, although his Italian was not as good as it might be, he could make himself perfectly clear in that language - apparently, he made his policy clear - and that his Pekinese was much better. On hearing that, one was immediately moved to wonder whether he was attempting to qualify for a berth in a Sputnik, because I understand that that is the breed of dog carried in the Russian satellite now rotating about the earth.

Mr Ward:

– Is the honorable member speaking with an Oxford accent?

Mr SNEDDEN:

– The accent of the honorable member for East Sydney (Mr. Ward), of course, is of the kind that is usually accompanied by rude words.

The apology by the honorable member for Melbourne on 20th October, 1957, for the internment of Italians during World War II. is quite remarkable. The honorable member was Minister for Information in the Curtin Government from 21st September, 1943, until shortly after that cataclysmic day for the Australian Labour party - 10th December, 1949. During the period of more than six years in which he occupied that portfolio, the honorable member did not utter a single word about the internment of Italians. For some reason, he chose to say to the Italians, in October, 1957, “It should not have happened. If I had been there, it probably would not have happened. Therefore, vote for me.”

It is desirable to know what were the facts of the matter in order that we should not fall into this erroneous conclusion. The Curtin Government, at one fell swoop, rounded up 1,419 Italians just after the Japanese came into the war.

Mr Aston:

– Who was the responsible Minister at the time?

Mr SNEDDEN:

– He was that very eminent gentleman. Mr. F. M. Forde, who was then Minister for the Army. What is even more interesting is that the Minister in the Curtin Government who was responsible for the administration of the National Security (Aliens Control) Regulations, under which these internments were made, was none other than the present Leader of the Opposition (Dr. Evatt). Are we to assume, then, that the honorable member for Melbourne is now making a play for the leadership of the Australian Labour party by trying to discredit the administration of the present Leader of the Opposition at the time when he was Attorney-General in the Curtin Government? Of course, the honorable member for Melbourne was always prone to speak when he ought not to speak. On 27th March, 1942, he consistently interrupted remarks made by Mr. Curtin, who was then Prime Minister. Referring to the head of the department that investigated persons before internment, Mr. Curtin said -

  1. . but the important point is that a civilian accustomed to the detection of crime and the preservation of public order, a man who was highly recommended for the position because of his great experience and exceptional gifts, is in charge of the department.

The Deputy Leader of the Opposition then interjected -

He is a fascist-minded gentleman.

What was the honorable member’s attitude at that time? He was to become Minister for Information within eighteen months. Apparently, his attitude underwent a great change over a period of some fourteen years. But it took fourteen years for the change to come about. What was the attitude of Mr. Forde, on 27th March, 1942, as Minister for the Army, administering the National Security (Aliens Control) Regulations? Mr. Forde said -

I speak after consultation with the Commonwealth Solicitor-General. I shall deal with the prosecution side later Under the law as it stands to-day any one who believes that he has been wrongly interned may apply to a tribunal which, as I have said, has already been constituted, and which has dealt with large numbers of cases. Actually there are two different kinds of internment tribunals; one deals with aliens and the other with British subjects. These tribunals are presided over ‘ by Supreme Court judges.

That was indicative of the attitude of the Labour government of the day. Mr. Forde said, also -

With regard to internments generally, I realize that the increasing seriousness of the war position, and the coming of the conflict to our own shores, necessitate an intensification of the control of aliens.

On 31st December, 1942, under the Labour administration, 3,836 Italians were in internment in this country. How ridiculous it is for the honorable member for Melbourne to make, after the lapse of fourteen years, what he regards as ari apology! On 6th May, 1942, in answer to a question asked by the present Treasurer (Sir Arthur Fadden), Mr. Curtin said -

Action has already been taken to intern those alien and other elements in Australia who, if left at liberty, would represent a menace to security. The position is constantly under review, and such internments are from time to time effected as the situation requires. It is not the policy to resort to mass internments, as such a policy does not materially add to the security achieved by the present course of action.

Mr. Curtin said that, knowing full well that the Labour Government was about to sweep up 1,419 Italians, and that it would hold 3,836 Italians in internment, compared with a mere 2,661 Germans.

Mr Ward:

– What point is the honorable member trying to make?

Mr SNEDDEN:

– What is possibly the interesting point is that the National Security (Aliens Control) Regulations were then administered by the present Leader of the Opposition, who was at the time AttorneyGeneral. It would be interesting to know whether the right honorable gentleman regards himself as rebuffed by the honorable member for Melbourne, who, after all these years, hopes to attract votes from these fine people who will not be misled by the sort of apology that has been given by the “ bounding Basque “, and whether the Leader of the Opposition concurs with the view of the linguist who finds that his Pekinese is more readily understandable than is his Italian. The newspaper report states -

The deputy leader of the Federal Opposition, Mr. Calwell, said today he spoke better Chinese than Italian.

Obviously, it implied, “ But his nonsense was even better! “

Mr CALWELL:
Melbourne

.- As I listened to the rude and senseless observations made by the honorable member for Bruce (Mr. Snedden), I thought of the words of Oliver Goldsmith, which may be adapted thus - o

The more he spoke, the more the wonder grew That one small head could carry all he knew.

Mr Snedden:

– Was that written in Italian or English?

Mr CALWELL:

– The honorable gentleman criticizes my smattering of Italian, but at least I speak with an Australian voice. My voice is not like that of the honorable member.

Mr Ward:

– His is a synthetic voice.

Mr CALWELL:

– Worse than that, it is a mixture of Oxford, adenoids and affectation. He should not try to fight outside his class.

Mr Cramer:

– Now tell us about the apology to the Italians.

Mr CALWELL:

– I have not the slightest difficulty in telling the House about that famous occasion when I broke into Italian.

Mr Killen:

– Was it famous?

Mr CALWELL:

– Yes. We had a gathering of very distinguished Italian leaders. Italian-born citizens of Australia gathered in the Northcote Town Hall. The chairman of the meeting was the honorable member for Batman (Mr. Bird). The honorable member for Yarra also spoke.

Government supporters interjecting,

Mr CALWELL:

– He is a very distinguished gentleman. The meeting was addressed also by the honorable member for Darebin (Mr. R. W. Holt).

Government supporters interjecting,

Mr SPEAKER:

-Order! There is too much noise on my right.

Mr CALWELL:

– The secretary of the Victorian branch of the Australian Labour party, Mr. John Tripovich, and I also spoke. Strangely enough, I had forgotten all about this press report. I took no notice of any of the reports. I assure the House, as surely as I stand here, that never at any time in the course of a long speech in English and partly in Italian did I mention the word “ apology “. I said I regretted that the record of this country in regard to internment during the war years was not as good as that of the United Kingdom or of the United States of America. I pointed out that we were not as mature in our consideration of the rights of citizens as we should have been. I said that many people who should not have been interned were interned. Members of the Australia First Movement were amongst them, and repeatedly in this House over the years I demanded justice for the members of that organization. The Minister for Supply (Mr. Beale) knows very well my association with the campaign to secure justice for these people, every one of whom was a Liberal party supporter. The question of the application of the Statute of Limitations and so on entered into the matter, but I shall not go over all that again.

When Labour assumed office people were interned. The then Commissioner of Police in Queensland, the late Mr. Carroll, wanted to put everybody of alien birth 100 miles back from the coastal regions. People were interned willy-nilly on what were called omnibus warrants, and the Ministry of the day was very concerned about the matter. The then Attorney-General appointed a committee called the Aliens Classification and Advisory Committee to report on internments. The present Minister for Supply knows the work of that committee very well. The committee consisted of the present Minister for Repatriation (Senator Cooper), against whom I suggest the honorable member for Bruce will offer no criticism; Mr. Arthur Cutler, V.C., who was then secretary of the New South Wales branch of the Returned Sailors, Soldiers and Airmen’s Imperial League of Australia; Mr. Dovey, now Mr. Justice Dovey, of New South Wales; Mr. Barry, now Mr. Justice Barry, of Victoria; and myself, as chairman. We reduced the number of internees from 9,000 to 900.

That is the story that I told these Italian people. I told them that it was to their credit that they bore no grievance against this country for the fact that in many cases they were interned quite wrongfully during the war period. The Minister for Defence (Sir Philip McBride), who is now interjecting, was a member of a government that interned a number of these people. I suggested to these Italian people that we should forget the past and face the future. Some people were interned for six years. That was a disgrace to this country, whether they were Germans, Italians, or of any other nationality. Some people were released under ministerial pressure without any difficulty at all.

I was not trying to make political capital out of it at all. In fact, I was amazed that there was a report of the meeting. I told these people that it was the Labour party that formulated Australia’s immigration policy in the post-war period, and that I was Minister for Immigration for four and a half years. I spoke, ‘ too, of the work of my successor, the present Minister for Labour and National Service (Mr. Harold Holt), but not a word of the praise that I bestowed upon him for his work appeared in the press report. And the honorable member for Yarra endorsed what I said about the work of the present Minister for Labour and National Service. I said that, as far as we were concerned, immigration was a non-party issue but that we were entitled to urge them, as working people, to become naturalized, and that we had as much right to appeal to them for their votes as had our political opponents.

I put to them the position in their native country where on one occasion 33 per cent, of the people voted for the Communist party. I told them that in this country not more than 1 per cent, of the people voted for the Communist party. I mentioned also the effort that Mr. Chifley made, with Signer de Gasperi, to bring out 40,000 people from Italy at a period when that country had to export 250,000 persons a year to escape chronic unemployment and that, if they had not escaped unemployment, there would have been a serious threat as a result of the Communist party capturing the minds of those people.

I put the position to them as fairly and dispassionately as I am putting it to the House to-night. All that happened next day was that one newspaper said that I apologized to the Italians for what happened during the war period. But the Melbourne “ Age “ which the honorable member for Bruce did not quote, gave a more factual and much fairer presentation of the news. I was told that on that particular night the “ Sun-News Pictorial “ sent along to the meeting a new man who did not know very much about political meetings, that he consulted somebody else, and so the headline went in. I make no complaint about what he reported me as having said.

I tell the House that I made no apologies to these people and that I was not trying to score off any war-time Minister. All Ministers worked particularly hard, but mistakes were made in regard to internments. I told the people at this meeting that I hoped it would never happen again and that, if we had been as wise as were the people of England when Hitler’s armies were only 20 miles away on the other side of the Channel, we would have interned only 1.6 per cent, of the people of this country instead of 16 per cent. I added that the number of people interned was a big loss to the war effort. What the honorable member for Bruce did not quote from the press report of my speech was my reference to the fact that among the Italians who were interned were men who had sons fighting in the Australian Imperial Force. If the honorable member looks at the reports of what the former honorable member for Herbert, Mr. Martens, and others said over the years, he will note what a very sorry story it was.

I am sorry that this incident has been blown up into such an issue. If the honorable member for Bruce wants to say anything about me in the future, I advise him to come and see me and I shall tell him whether his information is right or wrong.

Mr SPEAKER:

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

Mr BEALE:
Minister for Supply and Minister for Defence Production · Parramatta · LP

– I am glad to hear the honorable member for Melbourne (Mr. Calwell) say that he was misreported.

Mr Calwell:

– I am not saying that.

Mr BEALE:

– The honorable member is saying that.

Mr Calwell:

– I am saying that I was neither properly nor adequately reported.

Mr BEALE:

– That is an esoteric distinction which escapes me. I am glad to hear him say that he was not properly reported.

Mr Calwell:

– Or adequately reported.

Mr BEALE:

– That has happened to all of us, and I accept his statement quite readily. But what I rise to speak about is the implication which was present in his speech just now, and which therefore I think was probably present also in his remarks to the Italians the other night, that the Labour Government which succeeded the Menzies Government in 1941 was more generous and that it let the Italians out whereas the preceding government had interned them.

Mr Calwell:

– That is a wrong impression.

Mr BEALE:

– I am delighted to hear the honorable gentleman say that he did not intend to convey that impression.

Mr Calwell:

– Nor did I convey it.

Mr BEALE:

– My contribution to this adjournment debate, which has gone on for too long anyhow, is just this: I happen to have a personal knowledge of this matter. When Italy came into the war in 1940 there were a great many internments. There is no doubt about that. That was during the regime of the Menzies Government. But what the honorable gentleman did not say - and I do not blame him for this, because perhaps it was not part of his speech to say so - and what I want to say to the House is that at the time when a number of Italians were interned for the safety of the State - in time of a war which was growing very grave and desperate for us - the Menzies Government also set up a series of tribunals before which Italians who had been interned might come to appeal for their release - in other words, to show that they were not a danger to the State. I mention this because I was a member of one of these aliens release tribunals. I sat on that judicial body for about a year during that early stage of the war, and I think I continued to sit on it for a little time even after the government changed. However, my memory is not clear on that. We had a great many applicants before us - hundreds of them, and their relatives numbered hundreds more. We recommended to the authorities of the day, again and again and again, that appellants should be released from internment camps. To my personal knowledge many of them were released. A very great deal was done. The attitude of the tribunals was quite simple. We had an overriding duty to preserve national security in a grave and dangerous time, but where evidence was put before us that the people in question should either not have been interned or could be safely released, we recommended their release, and such people were released in very great numbers. The government changed. Some internees were not released, but were quite rightly kept in internment during the war. I do not hold it against the succeeding government that many of these people still remained in internment after the government changed. Some were released in a situation that I shall mention in a moment but many were not released.

Mr Calwell:

– Some of those released were re-interned when Japan entered the war.

Mr BEALE:

– That might have been done by the Labour government. As the tide of war changed, when the threat to Australia diminished and the climate of public opinion altered, the release of some, at least, of the interned people began to be advocated. It was considered that there was no point in their further internment; that it was unjust, unfair and inhuman to keep these people in. And they were released. What I say is that the government of the day, in making these internments, acted wisely as it saw the emergency at the time. But at the same time it set up machinery and tribunals to allow justice to be done. Justice was done. It was a rough sort of justice, I concede, but it was done, and it broadened as the days went by and we gained more and more experience. Aliens stayed in internment under the Labour government, but were released as time went on. The point I wish to make is that governments of both political complexions did their duty as they saw it in a dangerous time.

Mr Calwell:

– Hear, hear!

Mr BEALE:

– I am glad to hear the honorable member agree. I think this is above party politics. We should assert in this place, for the benefit of all parties, that although we have made mistakes - and one does make mistakes in time of war - we all did our duty as we saw it in the interests of Australia.

Question resolved in the affirmative.

House adjourned at 11.54 p.m.

page 1924

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Telephone Services

Mr Bryant:

t asked the Postmaster-General, upon notice -

What rules are applied for charging the £10 installation fee to telephone subscribers when transferring telephones to a new address and one or more extension telephones are involved.

Mr Davidson:
CP

– The answer to the honorable member’s question is as follows: -

The service connexion fee of £10 is payable for the provision of each new or additional telephone exchange line outdoor extension and private line as well as for the removal of a service from one address to another. For example, the £10 fee would be payable for the removal to other premises of an exchange line with which one indoor extension was associated. This charge covers a maximum of fifteen yards of internal wire and from experience it has been found that the allowance of fifteen yards is rarely exceeded. On the other hand, for the removal to another address of a private branch exchange service to which, say, one or more exchange lines and a number of indoor extensions were connected, the subscriber would be charged the actual cost of removing the private branch exchange switchboard and the internal extensions plus the prescribed fee of £10 for each exchange line.

Insurance Premiums

Mr J R FRASER:
ALP

ser asked the Minister for the Interior, upon notice -

  1. Has he authorized substantial increases in third-party insurance premiums for motor vehicles registered in the Australian Capital Territory?
  2. What is the estimated income to be derived by the insurance companies from the increased premiums in a full year?
  3. What was the income derived by insurance companies from premiums at the existing rate in the last full year for which records are complete?
  4. What payments did insurance companies make in that year pursuant to third-party claims in respect of vehicles registered in the Australian Capital Territory?
  5. How do the proposed rates compare with those charged, or proposed, in each of the six Australian States and the Northern Territory?
  6. Are claims under third-party insurance in the Australian Capital Territory determined by a single judge?
  7. Is the practice in the States to have these claims determined by a jury?
  8. Has the Government given any consideration to proposals that it should establish an insurance office in the Australian Capital Territory to provide cover in this and in other fields where there is statutory provision requiring insurances to be entered into; if not, why?
Mr Fairhall:
Minister for the Interior · PATERSON, NEW SOUTH WALES · LP

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

  1. Yes.
  2. £78,500.
  3. £53,366.
  4. £75,293. In addition the estimated liability on outstanding claims as at 31st December, 1956, was £126,350.
  5. Owing to the differences in the classifications of motor vehicles it is difficult to compare the rates charged in the States and Northern Territory with those in the Australian Capital Territory. In addition the liability of the insurer varies from State to State and this is reflected in the premiums charged. The attached schedule sets out the premiums charged where the classifications are comparable.
  6. The Motor Traffic Ordinance provides that actions brought against the owner or driver of a motor vehicle or against the nominal defendant shall be tried without a jury.
  7. It is understood that New South Wales is the only State in which juries are required to hear actions to determine claims under third-party insurance.
  8. No, the Government considers that this is a field best left to private enterprise.

Cite as: Australia, House of Representatives, Debates, 6 November 1957, viewed 22 October 2017, <http://historichansard.net/hofreps/1957/19571106_reps_22_hor17/>.

View PDF View XML View in Voyant