House of Representatives
27 August 1958

22nd Parliament · 3rd Session

  1. House of Representatives
  2. 22nd Parliament
  3. 1958

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

page 773

SOCIAL SERVICE BENEFITS

Petition

Mr. WARD presented a petition from many thousands of citizens of Australia praying that the House will give immediate consideration to the matter of increasing the rate of pension to at least 50 per cent, of the basic wage and liberalizing certain other social service benefits.

Petition received and read.

page 773

QUESTION

DUTCH NEW GUINEA

Dr EVATT:
BARTON, NEW SOUTH WALES

– I ask the acting Minister for External Affairs a question in relation to the recent statements by the Indonesian Government on the subject of that part of New Guinea which is under Dutch sovereignty. Is the Minister in possession of the exact claims or statements made by the Indonesian Premier or Minister on behalf of that Government? Can they be made available to this House? Has any answer to those claims been given directly by the Government of Australia to the Government of Indonesia? Are there any other relevant documents bearing on this matter which can be made public because the statements have been made public? Has general consideration been given by the Government to the question of what relief can be obtained in the international tribunals if the Government, as I believe it does, opposes that claim?

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

– I have not been able to obtain the exact text of what was reported to have been said by Dr. Subandrio at the time. It is very difficult to do so because, apparently, the statement was not taken down at any time. However, I can inform the right honorable gentleman that on Thursday last Dr. Helmi, the Indonesian Ambassador, called on me and said that, under instructions from his Government, he was to inform me that Indonesia had no intention at all of using force in connexion with its claim to Dutch New Guinea. I cannot give an immediate answer with regard to the other matters raised by the right honorable gentleman, but I shall have further inquiries made and if I am able to do so I shall let the right honorable gentleman know anything that is forthcoming.

page 773

QUESTION

DEFENCE FORCES

Mr McCOLM:
BOWMAN, QUEENSLAND

– My question is directed to the Minister for Defence and concerns serving members of the Defence Forces who receive injury while taking part in organized sport. Can the Minister tell the House first who, or what authority, defines what constitutes organized sport? Secondly, can the Minister say whether cases have occurred in which one of the defence services has slated that a man has been injured while playing an organized sport and yet subsequently a claim for compensation for the injury received, or for benefit under the Defence Forces Retirement Benefits Act, has been rejected on the ground that the man concerned was not taking part in an organized sport at the time of receiving the injury?

Sir PHILIP MCBRIDE:
LP

– I cannot give a precise interpretation of organized sport, but I think it is usually considered to be sport or recreation undertaken as part of a man’s training. It may very well be that a sporting team drawn from a particular service is playing away from its home base against another team. In those circumstances it is held that the players are not taking part’ in organized sport as the term is usually interpreted by the services.

On the question of whether there is any liability and whether compensation is payable, that matter is considered by the Commissioner for Commonwealth Employees* Compensation, and his decision is accepted by the services. Claims that a service has a legal responsibility to the claimant are not always concurred in by the commissioner who hears the case.

page 773

QUESTION

RAIL TRANSPORT

Mr COSTA:
BANKS, NEW SOUTH WALES

– Recently, I sought information from the Treasurer on two questions. One was: What percentage of the capital indebtedness of each State railway system is represented by original capital? The second was: Has any State funded its indebtedness under the Commonwealth-State Financial Agreement? In answer to those questions the Treasurer said that the information was not available. Can the Treasurer tell me why such information is not available?

Sir ARTHUR FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

– The short answer to the honorable member’s question is that the information sought is not available because it was not ascertainable from the States in the precise and decided form along the lines desired by the honorable member. I shall have another look at the question and see the extent to which I can assist the honorable member.

page 774

QUESTION

HIRE PURCHASE

Sir WILFRID KENT HUGHES:
CHISHOLM, VICTORIA

– I ask the Treasurer a question without notice. Will the right honorable gentleman consider sending representatives of the Commonwealth Trading Bank to England to study the credit system that I understand has been instituted by the Midland Bank as a check on interest rates charged by hire-purchase companies? Does the Treasurer consider that such a visit would be more advantageous than the recent visit by Commonwealth Trading Bank representatives to Peking? Does the Treasurer know that the Peking visit was interpreted in South-East Asia as a Government sponsored visit and as an indication of Government policy?

Sir ARTHUR FADDEN:
CP

– Answering the the latter part of the question first: No, I do not know what effect the visit to Peking had. I only know what the honorable gentleman has told me and, since my information comes from such a reliable source, I shall have further inquiries made, because I know that there must be some substance in what the honorable gentleman says. As for the suggested deputation, or mission, from the Commonwealth Trading Bank to inquire into the functions of the Midland Bank with regard particularly to hire purchase, first and foremost hire-pur- chase finance is a matter that is outside the constitutional authority of the Commonwealth. However, I will consider the question and see what information I can give to the honorable member.

page 774

QUESTION

ROYAL AUSTRALIAN NAVY

Mr CURTIN:
KINGSFORD-SMITH, NEW SOUTH WALES

– My question is directed to the Minister acting for the Minister for the Navy. Is it a fact that refitting work on the destroyer H.M.A.S. “Arunta” has been discontinued and that orders have been given for her to be laid up permanently? Is it also a fact that, in consequence, dismissal notices have been served on dozens of mechanics? Will the Minister inform the House as to whether H.M.A.S. “Hobart” has been sold to Japan for scrap? If so, what price was paid for her? If H.M.A.S. “ Hobart “ has not been sold, can the Minister inform the House as to her whereabouts?

Mr OSBORNE:
Minister for Air · EVANS, NEW SOUTH WALES · LP

– I am asked several questions about the refitting and present movements of Australian ships. H.M.A.S. “ Arunta “ is still being refitted at Garden Island. It is not a fact that any decision has been made to discontinue work on “ Arunta “. The honorable member for Kingsford-Smith recently asked me in the House whether “ Hobart “ had been sold to the Japanese, where she was and whether she was under tow to Japan. I told him that I thought she was tied up in Sydney Harbour. I have since verified that suspicion and have learned that it is only too true - she is tied up in Sydney Harbour. I point out to the honorable member that, if he were to do what any other citizen of Sydney can do - that is, go and have a look - he would see this for himself. He was apparently dissatisfied with my previous answer and he asked my colleague, the Minister for Defence, the same question. He was given very much the same answer. I suggest that, if he is not satisfied with the answers given to him in this House, he should use his prerogative as a human being and have a look for himself.

page 774

QUESTION

MILK POWDER

Mr LUCOCK:
LYNE, NEW SOUTH WALES

– My question is addressed to the Minister for Supply, who is acting for the Minister for Trade. Have reconstituted milk plants in under-developed countries resulted in increased markets for Australian milk powder? Is the Australian dairying industry likely to obtain future benefits from these schemes?

Mr TOWNLEY:
Minister for Supply · DENISON, TASMANIA · LP

– I can understand the honorable member’s interest in the sale of milk powder. As I understand the position, certain under-developed countries in Asia have some supplies of buffalo milk. A machine has been designed which will take buffalo milk, add milk powder and, of course, water, and so make quite a palatable and nutritious food. However, the position in regard to theAustralian industry is this: Some of these under-developed countries, such as India, have not been buying Australian powdered milk, firstly because of exchange difficulties and import restrictions, and secondly because they have received very large supplies of powdered milk as grants from countries such as the United States of America. One of these toning machines has been set up in Bombay and is, I believe, working satisfactorily. So the answer to the honorable member’s question is that, in the short term, it is not likely while import restrictions and exchange difficulties exist that there will be a big increase in the demand for Australian milk powder, but, in the long term, I think that sales of Australian powdered milk will increase greatly.

page 775

QUESTION

RELATIONS BETWEEN AUSTRALIA AND INDONESIA

Mr STEWART:
LANG, NEW SOUTH WALES

– My question is addressed to the Prime Minister. In view of the apparent deterioration in relations between the Australian Government and the Indonesian Government, will the right honorable gentleman consider issuing to President Soekarno and a parliamentary delegation from Indonesia an invitation to make a goodwill tour of Australia so that the President and the members of the parliamentary delegation may obtain a better understanding of Australia and Australians?

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– I must say that I deprecate the suggestion that there has been a deterioration of relations between Australia and Indonesia. I do not think that is true. We are, in fact, on the most friendly terms with the Government of Indonesia. We have one point of difference, and that is very well known to all members of this House. I had thought that the Government’s view on that matter was supported on both sides of the House. Apart from that one matter of difference in respect of Dutch New Guinea, our relations with Indonesia are very good and are conducted on a proper and friendly basis.

page 775

QUESTION

LAW OF THE SEA

Territorial Waters

Mr SNEDDEN:
BRUCE, VICTORIA

– I address my question to the Minister for Defence in his capacity as acting Minister for External Affairs. Has the recent international conference on the law of the sea, which dealt with territorial limits, and at which Australia was represented, concluded its deliberations? If so, what were its conclusions? Further, can the Minister inform the House of the present situation concerning Iceland’s claim to increase its territorial limits to 12 miles from shore, and how many nations are likely to be affected by this claim?

Sir PHILIP McBRIDE:
LP

– The conference on the law of the sea which was held earlier this year did not reach any conclusions. As I understand the matter, it was left to the United Nations General Assembly, at its meeting next month, to decide whether a fresh conference should be called to discuss these matters. It is true that the Government of Iceland - I think in June - claimed an extension of its territorial waters, within which it has absolute fishing rights, from 4 to 12 miles off shore. That, of course, materially affects the traditional fishing grounds of Great Britain, and I understand that the United Kingdom Government has protested at the position taken up by Iceland in this matter. I cannot tell the honorable member, offhand, just how many nations will be affected by the decision, but it is certain that Great Britain is vitally affected.

page 775

QUESTION

HIRE PURCHASE

Mr GALVIN:
KINGSTON, SOUTH AUSTRALIA

– Is the Prime Minister aware of a proposed conference of representatives of State governments to discuss possible legislation to cover hire-purchase transactions? Has any invitation to participate in such a conference been received by the Commonwealth Government? If not, will the right honorable gentleman have inquiries made with a view to the Commonwealth being represented in order that any legislation shall be uniform, not only in the States but also in Commonwealth territories?

Mr MENZIES:
LP

– I am not aware of such a conference.

page 775

QUESTION

CANCER RESEARCH

Mr KILLEN:
MORETON, QUEENSLAND

– I address to the Minister for Health a question which relates to smoking and smog, and to the apparent connexion between them and lung cancer. I ask the Minister: Is there in existence any body, either Commonwealth or State, or jointly constituted, which is reviewing the available clinical and statistical evidence seeming to indicate a connexion between smoking and smog and lung cancer? If there is no such body in existence, will the honorable gentleman consider taking the initiative in establishing one?

Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– There is no body in existence specifically for the purpose. There is quite a lot of statistical information which is available to bodies such as the National Health and Medical Research Council, the Department of Health and those bodies or persons interested in investigating the matter.

page 776

QUESTION

GARDEN ISLAND DOCKYARD

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

– I direct a question to the Minister acting for the Minister for the Navy. Recently the honorable gentleman advised the House that he was unaware that wholesale retrenchments were taking place at Garden Island, Sydney’s major naval repair dockyard. Since more than 200 men have now been sacked or have received notice, I ask the Minister whether the Government has abandoned Garden Island as an establishment of major defence significance. Why has the Government left the Royal Australian Navy without adequate repair facilities? Have these 200 men been sacked with the Minister’s approval, or is he still unaware that this major defence establishment has been so seriously disrupted?

Mr OSBORNE:
LP

– lt is quite an exaggeration to say that the activities of Garden Island have been seriously disrupted.

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

– One-third of the labour force has been dismissed.

Mr OSBORNE:

– No, much less than One-third. The position is this: Owing to the laying up of some ships during the past year, and owing to the programme of conversion of Q-class destroyers nearing completion, in the Estimates of Expenditure for the coming year the work force at Garden Island has been provided for on a basis of 2,100 men. The highest figure that labour force reached during the post-war years, so I am informed, was 2,450. By a process involving the non-replacement of those who resign and retire, and the discharge of a small number of persons at Garden Island, it is proposed to get the labour force down to 2,100 and to maintain it at that level.

The honorable member goes through the motions of disagreeing with me. I have cited him the figures, showing that the highest employment figure at Garden Island in post-war years was 2,450. The planned employment level at the Garden Island dockyard during the coming year will be 2,100, ar.d any suggestion that one-third of the labour force has been disposed of is quite incorrect, lt is hoped that it will not be necessary to discharge any more men, or, if it is necessary, that they will be very few in number. Steps have been taken by the Government to do everything possible to ensure that the men so discharged will be employed, in their present trades, in other dockyards. Some have been moved to Williamstown dockyard - a few, I admit. Some have been found employment at Cockatoo Island and at other places in Sydney. As I have said, it is hoped that by the ordinary processes of retirement and resignation we will be able to get the figure down to 2,100 without any further largescale retrenchments.

page 776

QUESTION

PORT OF PORTLAND

Mr TURNBULL:
MALLEE, VICTORIA

– ls the Prime Minister aware that it would be of great advantage to the whole of western Victoria and the south-east of South Australia if produce and goods from and for these areas were shipped and received from the port of Portland, which will soon be ready for almost unlimited operations, as the Prime Minister will have observed during his recent visit? Is there any way in which the Government can assist in the building, as a national project, of a railway line between Ouyen and Patchewollock to link the national port of Portland with prolific north-western Victoria?

Mr MENZIES:
LP

– I recently visited Portland and saw the remarkable work that is going on there. It is much more advanced than I had expected to see it. Of course, since my early days, I have been familiar with the idea that the western part of Victoria and the south-eastern part of South Australia might well have a port of exit and entry at Portland. This is not, of course, primarily a problem for the Commonwealth Government, and up to now, so far as I know, the matter has not been specifically raised with us by the Government of the State of Victoria. But it is a problem that I am interested in. I make no undertaking about it, but if some proposal were put before us by the State of Victoria we would naturally look at it. I point out to the honorable member that it is not the practice of the Commonwealth to indicate what works should be carried out by a State government, or what transport policies should be pursued. Therefore, no doubt, there would have to be great changes of mind before anything done by the Commonwealth could be expressly related to a particular operation. I hope the honorable member follows me on this matter.

page 777

QUESTION

H.M.A.S. “ HOBART »

Mr KEARNEY:
CUNNINGHAM, NEW SOUTH WALES

– I direct a question to the Minister acting for the Minister for the Navy. Is it correct that H.M.A.S. “ Hobart “ has been sold for scrap? If so, to whom was it sold?-

Mr SPEAKER:

– Order! I think that that question has been adequately answered.

page 777

QUESTION

DEFENCE SERVICES

Mr FORBES:
BARKER, SOUTH AUSTRALIA

– Can the Minister for Defence say what progress has been made with the integration of certain services common to the Army, Navy, and Air Force, which was announced by the Government earlier this year?

Sir PHILIP McBRIDE:
LP

– The integration of these various common services is going ahead quite quickly in certain respects. In others, more time, organization and planning are required to achieve the position that we ultimately hope to achieve. I assure the honorable member that all the recommendations which were made by the Morshead committee in this matter have been actively engaging the attention of my department and the service departments for some time now.

page 777

QUESTION

NORTH-WEST OF WESTERN AUSTRALIA

Mr WEBB:
STIRLING, WESTERN AUSTRALIA

– I direct a question to the Prime Minister. Has a submission been received from the Western Australian Government in respect of the expenditure of the federal grant for the development of the north-west? If a submission has been received, will the right honorable gentleman please supply the details, and indicate when he will be in a position to reply to the Western Australian proposal?

Mr MENZIES:
LP

– i am in receipt of a communication from the Government of Western Australia. I expect to be sending a reply in the next few days. When that has been done, I shall be very glad to make it available to the honorable member.

page 777

QUESTION

WOOL

Mr CAIRNS:
YARRA, VICTORIA

– Is the Treasurer aware of a claim made yesterday that £100,000,000 of the fall in wool proceeds since 1.957 has been the result of the operation of the overseas “ futures “ market? Is he also aware that the practice of selling futures, or bearing a market, is a wellrecognized method adopted by buyers to force down the price of the commodity they buy? Will the Minister, therefore, in view of the circumstances that suggest there might be something serious in this claim, undertake to have an investigation made immediately by men experienced in forward selling into the operation of overseas futures markets insofar as they affect Australian wool?

Sir ARTHUR FADDEN:
CP

– I am aware of the allegation; I am not aware of the fact. Who could establish the fact I do not know, nor do I know what the Government can do towards insisting that people should pay a certain amount for something they buy on a free market.

page 777

QUESTION

ROYAL AUSTRALIAN NAVY

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– I direct a question to the Minister acting for the Minister for the Navy. Is it a fact that an announcement was made a little while ago of the appointment of two new rear-admirals in the Royal Australian Navy? Will the Minister state whether this decision means an increase in the number of rear-admirals or the replacement of former holders of this rank? If the former is the case, will he state on which particular fleet unit each of the new rear-admirals will serve, how many occupants there are of this rank at present, how many fleet units are in commission, and whether it is a fact that the Government is so well advanced in its defence preparations that it is now in a position to provide two rear-admirals for every fleet unit?

Mr OSBORNE:
LP

– I do not .recall whether an announcement has been made recently of the appointment of any more rear-admirals. In fact, it has not occurred during the short period that I have been acting in this portfolio. As to the other part of the honorable member’s question, I can assure him that the Royal Australian Navy has an establishment of senior officers, and that establishment has been adhered to and not exceeded.

page 778

QUESTION

CONFERENCE OF PRIME MINISTERS

Mr MAKIN:
BONYTHON, SOUTH AUSTRALIA

– Will the Prime Minister inform the House whether he has received an intimation that there will be a meeting of Prime Ministers of the British Commonwealth of Nations . during the latter part of this year? What are the items that are likely to be discussed at such a gathering?

Mr MENZIES:
LP

– I have had no news of such an event until the honorable member mentioned it. I can imagine that, if he is right and there is to be such an event towards the end of this year, I or my successor might find it somewhat difficult to be present, but there is no foundation for the statement.

page 778

QUESTION

NATURALIZATION CEREMONIES

Mr LESLIE:
MOORE, WESTERN AUSTRALIA

– I preface a question to the Minister for Immigration by stating that, some time ago, I made representations to the Minister’s predecessor for consideration of a payment to local government authorities of some small amount to cover the cost incurred in the entertainment associated with naturalization ceremonies. The former Minister gave a very reasonable reply. Will the Minister for Immigration inform the House whether he has received any further representations or requests from any other source since the matter was raised by me in this chamber?

Mr DOWNER:
Minister for Immigration · ANGAS, SOUTH AUSTRALIA · LP

– I appreciate the interest of the honorable member in this matter. I know that it has been raised by local government bodies from time to time and that it was examined by my predecessor. I myself have had a look at it, but so far it has not been possible for me to make any arrangements different from those which have obtained hitherto.

page 778

QUESTION

CANBERRA COMMUNITY HOSPITAL

Mr J R FRASER:
ALP

– I ask the Minister for Health: Is it a fact that, at the Minister’s direction, a new scale of increased fees and charges for the Canberra Community Hospital has been prepared by the Department of Health and is being held for proclamation? Is it also a fact that the Minister has given instructions that these new fees and charges are not to be proclaimed until some date after 22nd November? Does this indicate that the Minister anticipates the return of this Government to office and of himself as Minister for Health? If the Minister does hold these wildly fanciful ideas, will he take immediate action to have the charges reviewed so that patients will not be asked to bear the additional cost at a hospital at which, under an enlightened administration, treatment was free?

Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– If the honorable gentleman will possess his soul in patience he will, perhaps, learn that those ideas are not so fanciful as he supposes.

page 778

QUESTION

MINISTRY OF LABOUR ADVISORY COUNCIL

Mr SNEDDEN:

– Will the Minister for Labour and National Service inform the House whether there is any prospect of the Australian Council of Trade Unions changing its attitude towards membership of the Ministry of Labour Advisory Council so that that council, which was so helpful to industry in Australia generally, can pursue the work it was doing before its collapse?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I believe there are divisions of opinion in the ranks of trade unionists generally about the wisdom of the decision taken by the interstate executive of the A.C.T.U. to withdraw from the Ministery of Labour Advisory Council. I cannot give any information to the honorable gentleman which suggests that any official move to reconsider that decision has been made inside the interstate executive itself. There have been some discussions, I believe, on the Trade and Labour Council level, but nothing has emanated from those which would lead me to believe that any early change in attitude can be expected.

page 778

QUESTION

RUBBER

Mr COUTTS:
GRIFFITH, QUEENSLAND

– I address my question to the Minister for Supply, in his capacity of acting Minister for Trade. Since a condition of the trade treaty recently signed with Malaya provides for the importation of rubber from Malaya free of the 2d. per lb. duty charged at present, will the Minister inform the House whether this action will prejudice the proposed establishment of a synthetic rubber industry in Australia?

Mr TOWNLEY:
LP

– The concession for Malayan rubber applies to natural rubber only, and it is not thought that it will have any effect on the synthetic rubber industry. What the duty position will be in regard to synthetic rubber has still to be considered by the Australian Government.

page 779

QUESTION

MUNICIPAL LOANS

Mr LUCK:
BRADDON, TASMANIA

– I ask the Prime Minister: In view of the difficulties experienced by munipical and semi-government authorities in raising loan moneys for capital works after approval by the Australian Loan Council, will the Prime Minister make an effort to convene a conference of Federal and State government representatives and municipal and semi-government authorities in order to find some solution to this problem?

Mr MENZIES:
LP

– Before that question, which is one of policy, could be approached, it would be necessary to find out whether this difficulty really exists. My impression, from my recollection of the facts, is that in the semi-government and local government field loan raisings have been comparatively successful. But I shall have a look at the matter with my colleague, the Treasurer, because that, as the honorable member would agree, is rather a necessary pre-condition to examining the proposal that the honorable member makes.

page 779

QUESTION

APPRENTICESHIP

Mr CAIRNS:

– I preface a question to the Minister for Labour and National Service by saying that in August, 1955, the Minister was asked a question about the decision of the Commonwealth-State committee of inquiry into apprenticeship, and that at that time he said consideration had been given to the findings by the Commonwealth authorities and that copies of the report had been sent to the State Premiers, four of whom had replied agreeing with the proposals. I now ask the Minister whether anything further has been done since August, 1955, in relation to the proposals of the Commonwealth and Stale apprenticeship inquiry. Does the Minister know that there is considerable disquiet among apprentices, and among those concerned with them, about their conditions and pay, employment and education? In view of this, will he see what can be done, either by discussions with the States or by statements made on behalf of the Commonwealth arbitration authorities, to have some of the decisions by the inquiry implemented in some way?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– In prefacing his question the honorable member for Yarra referred to a number of State governments having replied agreeing to proposals. I am not sure that that states the position accurately. At least, it may convey an impression that detailed proposals bad been submitted to the States inviting their concurrence in them, and that four States had replied affirmatively. That it not my impression. We have been in contact with the various State governments, and I know that the matter has been actively under the attention of the Department of Labour and National Service in the intervening period since 1955. I regret that I am not able, at this point, to give him without notice a clear and up-to-date picture showing just where the matter stands at present. I shall have a statement prepared which can either be made available to the House generally or conveyed direct to the honorable gentleman.

page 779

QUESTION

POLITICAL PARTIES

Mr ANDERSON:
HUME, NEW SOUTH WALES

– Has the attention of the Minister for Labour and National Service been drawn to a recent authoritative statement that the expulsion of Australian Labour party members guilty of sharing unity tickets with the Communists would assist the Australian Communist party? Is there any truth in the suggestion?

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I have seen a statement of that character attributed to the newly-elected senator from New South Wales. I find it a curious piece of thinking, but one which adds to the remarkable divisions of opinion which appear to exist in the ranks of honorable gentlemen opposite on this whole question. We had the Leader of the Opposition speaking authoritatively, as we understood it, only a week or so ago, telling us that the Australian Labour party viewed very seriously the association of its members with Communists on unity tickets and indicating his belief that disciplinary action would be taken to redress that position. I may say, in passing, that this attitude has strikingly contrasted with that which he adopted in this House in April of this year when he said that what went on inside the trade unions was entirely a matter for the trade unions themselves. However, even if this was a change of attitude of more recent times, it was welcomed by the House and the country, I believe. Since then, of course, his attitude has been disavowed by, I think, the honorable member for Darebin, and we have had from the new senator from New South Wales another viewpoint altogether. What, at least, does seem to emerge clearly from the various statements and attitudes is that Labour members are realizing, quite realistically, that they are so placed in relation to the Communist party that they cannot afford to have the Communists with them and that, on the other hand, they cannot afford to be without them. I leave them on the horns of that unhappy dilemma.

page 780

COMMONWEALTH MOTOR VEHICLES

Mr WHITLAM:
WERRIWA, NEW SOUTH WALES

– The Prime Minister will recall that for the better part of a year I have been asking him whether the Commonwealth would be prepared to accept the same responsibility for injuries caused by Commonwealth motor car drivers as the State governments accept for injuries caused by their drivers and compel private motorists to accept in regard to injuries caused by their vehicles. The right honorable gentleman will recollect having written to me over three months ago stating that a submission on this matter would be made to Cabinet and would be considered at an early date. I therefore ask him whether the matter has yet been submitted to Cabinet and whether any decision has been made upon it.

Mr MENZIES:
LP

– The matter has had some consideration. There are some aspects of it, as the honorable member will realize, that are not without their complications and which have been investigated since. I do not undertake to give the honorable member an answer to-morrow, but I will give him the complete answer to his question on the next day of sitting.

page 780

QUESTION

TRADE CREDITS

Mr FORBES:

– I ask the Treasurer whether the Government has given consideration to providing credit to countries other than New Zealand to assist them to buy our products. Does he not think that such a grant of credit would have an important influence on the price of our primary exports and upon our export income?

Sir ARTHUR FADDEN:
CP

– I know of no application for, or consideration of, the extension of credit to countries other than New Zealand. As a matter of fact, the Commonwealth Government did not make the credit available to New Zealand. It was made available as between the Reserve Bank of New Zealand and the central bank of Australia.

page 780

QUESTION

NAVAL SURVEY

Mr CURTIN:

– Will the acting Minister for the Navy state whether it is .a fact that a naval survey is being carried out in the Timor Sea by navy ships working out of Darwin? Could the Minister advise me of the type of ship carrying out this survey? Is it a fact that on board these vessels are a number of Japanese scientists and naval officers?

Mr OSBORNE:
LP

– It is quite correct that a survey of the Sahul Bank in the waters of northern Australia has been carried out by four ships of the Royal Australian Navy. This very large-scale survey has been a remarkable undertaking and was completed within the short space of ten weeks. For the reason that it has been a remarkable undertaking and achievement, I am about to issue a statement on the subject.

I have no knowledge whatever of the presence of any Japanese, naval officers or otherwise, in any of the ships. This seems to me to be so unlikely that such a suggestion is probably another of the products of the fanciful imagination of the honorable member who asked the question.

page 780

SOCIAL SERVICES

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

– I lay on the table the following paper: -

Social Services Act - Seventeenth Annual Report of the Director-General of Social Services for year 1957-58.

Ordered to be printed.

page 781

GOVERNMENT BUSINESS

Precedence

Motion (by Mr. Harold Holt) agreed to -

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

page 781

TRADE MARKS BILL 1958

Second Reading

Mr OSBORNE:
Minister for Air · Evans · LP

.- I move-

That the bill be now read a second time.

The purpose of this short bill is to authorize the person from time to time holding the office of Deputy Commissioner of Patents to be appointed also to the office of Deputy Registrar of Trade Marks.

The Trade Marks Act 1955 provides, inter alia, that there shall be a Deputy Registrar of Trade Marks. In ordinary public service practice an office designated as Deputy Registrar of Trade Marks would be created under the provisions of the Public Service Act and an officer would be appointed to that office. In this case, however, it is proposed to appoint the Deputy Commissioner of Patents to be also the Deputy Registrar of Trade Marks. The Public Service Act does not authorize one officer to be appointed to two positions. Consequently, it is necessary to amend the Trade Marks Act 1955 to enable the Deputy Commissioner of Patents to be appointed also to the office of Deputy Registrar of Trade Marks.

There are sound administrative reasons for the Government’s decision to appoint one officer to both positions. Firstly, the normal line of promotion in the Patent and Trade Marks offices is from Deputy Commissioner of Patents to Commissioner of Patents. At present, the Deputy Commissioner of Patents does not deal with any trade mark matters, as he has no authority to do so. The proposed amendment will give him the opportunity to gain experience in the trade marks field and qualify himself for appointment as Commissioner of Patents and Registrar of Trade Marks.

Secondly, it is customary at present for the Deputy Commissioner of Patents to act as the Commissioner of Patents and Registrar of Trade Marks during any absences of the Commissioner.

The bill will also correct a small error in the act by adding the word “or”, which is at present omitted, at the end of paragraph (b) of sub-section (1.) of section 135 of the Trade Marks Act 1955. 1 commend the bill to the House.

Debate (on motion by Dr. Evatt) adjourned.

page 781

CHRISTMAS ISLAND BILL 1958

Second Reading

Debate resumed from 26th August (vide page 712), on motion by Mr. Hasluck -

That the bill be now read a second time.

Dr EVATT:
Leader of the Opposition · Barton

– This bill, which was introduced yesterday, has been considered by the Opposition, and we support it. The measure provides for the completion of the change of government in relation to Christmas Island and for vesting in the Commonwealth authority over the island. It is an interesting illustration of the processes and practices which have now become turned into statute law, and the Statute of Westminster authorizes the Commonwealth’s action in this matter.

Christmas Island was originally noted for the fact that Australia and New Zealand purchased an important phosphate deposit there. They have an interest in the territory, and this island will now come under the control of the Australian Government. The Opposition wishes this legislative venture every possible success, and supports the motion for the second reading of the bill.

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 781

QUESTION

ESTIMATES 1958-59

In Committee of Supply: Consideration resumed from 26th August (vide page 768).

Department of External Affairs

Proposed vote, £2,376,000.

Mr MAKIN:
Bonython

.- The Committee is now considering the Estimates of the Department of External Affairs, involving a sum of £2,376,000. It is regrettable that we cannot have the advantage of the presence of the Minister for External Affairs (Mr. Casey) at a time when consideration is being given to affairs associated with the administration of this department. However, I fully appreciate the importance of his presence at the United1 Nations at this time, and also his work in dealing with the missions from this country to other countries. In those circumstances I do not complain that the Minister is not present, but I feel that some better provision should be made to meet the situation created by his absence. I do not say this in any unkind or ungenerous way to the Minister for Defence (Sir Philip McBride), but I think he will agree with the soundness of my argument that in view of the fact that the Minister for External Affairs must necessarily be absent from this country a great deal during the sittings of Parliament, we should have some more permanent arrangement for a Minister to act for the Minister for External Affairs. Perhaps we could have something in the nature of an assistant Minister. Then, instead of several Ministers acting at different times for the Minister for External Affairs, honorable members could look to one particular man for explanations with regard to this department. I think that the appointment of an assistant Minister may perhaps be the best arrangement. When Labour was in office it was my pleasure very often to deputize for the Minister for External Affairs, who is now the Leader of the Opposition (Dr. Evatt). That arrangement seemed to be very satisfactory. It meant that the administration always had a responsible person at the helm, who was able to answer readily questions submitted to him by honorable members. In those days, if the Minister had to leave the country, honorable members knew who would be acting in his stead. But that is not the case to-day. At present the Minister for Defence is acting for the Minister for External Affairs, but to-morrow his place may be taken by the Minister for Civil Aviation, the Minister for the Navy, or any other Minister.

In looking at the Estimates for the Department of External Affairs, I notice that the amounts allowed for our representation abroad vary as between one country and another. I should like to know the reason for those variations. Are our embassies or legations classified according to their importance, or are our representa tives classified according to their position in the Commonwealth Public Service? I know that many of the men who occupy those positions are what are known as career men and possibly they are classified in different categories. But I want to know the reason for the variation in the amounts allowed in the Estimates. In some cases, the amounts allowed are very low and do not, I think, truly reflect the importance to Australia of the country concerned.

At this stage I should like to pay a tribute to the splendid work that was done by the Leader of the Opposition when he held the portfolio of Minister for External Affairs. He brought to the department a significance and an importance that it never enjoyed previously. Australia’s name became well known throughout the world. His work at the United Nations was acclaimed and Australia was looked to for leadership, particularly among the middle-class Powers and the smaller nations. Australia’s advice was constantly sought, and accepted. Our policy in matters affecting international affairs was a progressive one. The right honorable gentleman’s capabilities were acknowledged in the United Nations and he was elected to the position of President of the United Nations General Assembly. Australia then held a high place in the esteem of other countries, but I am afraid that in more recent times we have lost some of that esteem. With the growing importance of external relationships we should have a greater say in the work of the United Nations and other bodies that control the affairs of nations. I should like to see greater efforts towards Australia again showing leadership in the council of nations and helping to maintain the peace of the world.

I bring to the notice of the Government an anomaly that is long overdue for correction. From my experience in these matters, I should say that the heads of missions are not allowed the discretionary powers that their office should enjoy. Far too often the head of a mission has to refer a matter, commonplace in its character but administrative in its nature, to the central administration at Canberra before he can give even a minor decision. The heads of missions should be given greater discretionary powers.

The next matter I should like to bring to the notice of the Minister concerns noncareer men, who are brought in from the general community to represent Australia at diplomatic missions. No provision is made for the payment of a retiring allowance to these men at the expiration of their period of office. In Canada, at the termination of their service, men who are brought from professional or business life in the general community to occupy positions in the diplomatic service are given as a retiring allowance an amount equal to onethird of the salary amount that they have received during their service.

The CHAIRMAN (Mr Adermann:
FISHER, QUEENSLAND

–

Order! The honorable member’s time has expired.

Mr WIGHT:
Lilley

.- I find it somewhat hard to understand how the honorable member for Bonython (Mr. Makin) can reconcile some of the statements he has just made with the fact that he has had a long career in politics and was at one time a Minister of the Crown. He has now advocated the appointment of an assistant Minister. Surely, as a former Minister, he would know that constitutionally that is not possible. The honorable member also said that he cannot understand why there is a difference in the allowances paid to heads of missions in the various countries. Surely he knows that the cost of living varies considerably in different countries and that in some centres it is necessary to pay a much higher rate of salary and allowance so that the diplomat concerned can maintain a standard equivalent to that maintained in areas where the cost of living is lower. The Public Service Board appoints inspectors who visit the missions from time to time. They determine the amount of salary and allowance that will be paid. The honorable member should also know that some positions are filled by men of a rank senior to those appointed to other embassies.

Australia is very fortunate in the work that is being done at the moment by our embassies, consulates and missions overseas. It is well to bear in mind that, when this Government came to office in 1949, Australia was singularly lacking in friends in Asia. The great majority of Asian people had been grossly offended by the policies, the statements and the attitude of the pre vious Government. However, much good work has been done to overcome Asian prejudice to Australia. To-day, we are very fortunate in that we can claim that throughout Asia we have many allies and friends. This is, of course, evidenced by Seato, Anzus and Anzam. In addition, much good work is being done under the Colombo Plan to win friends in Asia. We believe the fate of Australia is intimately linked with the fate of Asian nations.

To suggest, as the honorable member for Bonython did, that the work being done in the United Nations Organization does not measure up to the standard that he requires, ignores completely the tremendous job that has been done and the great respect that has been earned for Australia by our representative there, Dr. Walker. It also completely brushes aside the report of Keith Shann on the Hungarian situation. However, one would not expect the honorable member to have any sympathy with the views expressed in the report on the situation in Hungary, furnished by the committee of which Keith Shann was chairman. If a government in which the Leader of the Opposition (Dr. Evatt) and the honorable member for Bonython were leading lights was ever elected to the treasury bench of this Parliament, we could be sure that those who are now behind the Iron Curtain and who operate the Iron Curtain would well and truly become our friends and those who are now our friends would be lost.

My main purpose in speaking now is to pay tribute to the work being done by our embassies in Asia. It is true that Australia bears the highest reputation in Asiatic countries, particularly in the countries of South-East Asia. The Minister for External Affairs (Mr. Casey) is held in the highest esteem by all sections of the community. That can be clearly illustrated by the fact that a business man in Singapore told me that if headlines appeared in the newspapers of any country in Asia reading, “ Casey says “, everyone from the coolie to the business man and the politician would know that reference was being made to the Australian Minister for External Affairs.

I feel that the amount of salary and allowances paid to the staff of our embassies is insufficient. I spent some time in Bangkok, and I was able to observe there the struggle that members of our embassy staff had to try to work on a parity with the representatives of some other nations there. I had a long talk to the New Zealand charge d’affaires, and 1 was able to learn how much better off he is than are the people in our embassy. 1 am quite certain that inadequate transport is provided for the Australian embassies and consulates that I visited in Asia. I suggest that the Public Service Board give special consideration to the situation of our embassy at Bangkok. Up to the present, the staff there has been able to obtain some concession in the purchase of commodities for the maintenance of their homes through the British commissary. However, that has now closed down and our representatives can no longer purchase their goods at the same discount rate. Consequently, they have been prejudiced to that extent. It may be twelve months before the Public Service Board would normally examine this situation and make the necessary adjustment to the allowances. Therefore, I urge that special consideration be given to the matter as urgently as possible.

Many Asian countries can be regarded as our very good friends; others must be regarded definitely as our enemies, because they are even now waging a cold war upon us and upon our allies. However, we seem to have failed to recognize the fact that, although we have given de jure recognition to the Nationalist Government of China, we have not established a diplomatic post in Taiwan. The United Kingdom Government does not give de jure recognition to the Nationalist Government, but gives de jure recognition to the Communist Government in Peking. The United Kingdom gives de facto recognition to the nationalist Government. Despite this the United Kingdom Government believes that it should have a diplomatic post in Taipei, and has appointed a consul there. Yet the Australian Government, which gives de jure recognition to the Nationalist Government, has no diplomatic post or trade mission in Taipei! Except for the fact that we support the Chiang Kai-shek Nationalist Government at the United Nations and have a Chinese Nationalist mission here in Canberra, there is no other evidence that we give the Chinese Nationalists de jure recognition.

I consider that this is an offensive attitude for the Government to adopt towards people who are our staunch and loyal friends. We must bear in mind that this attitude has a considerable effect on the minds of the 12,000,000 Chinese outside China who are spread throughout Asia and who want to see the prestige of the Nationalist Government lifted. They feel that some countries are abandoning the Nationalists. We know that although U Nu and U Ba Swe, in Burma, have given de jure recognition to red China, a great many people in Burma resent this action of the Burmese Government. Those people are very conscious of the fact that the Australian Government has failed to establish a diplomatic post in Taipei. I was asked by Mr. Thiep, the Secretary-General of the Nationalist Assembly in Viet Nam, why Australia had neglected to do so. I was asked the same question by General Thanom, in Thailand. People throughout Asia fail to understand why we give de jure recognition to a country and fail to establish a diplomatic post in it. We have a post in Cambodia and one in Viet Nam. We have two officers of the Australian Government in Korea appointed to the United Nations Commission for the Unification and Rehabilitation of Korea. We have an embassy in Japan and one in the Philippines. Yet we have nothing in Taipei!

I suggest that this is a matter that must be given urgent and very high priority. We understand how important it is when we realize the tremendous build-up of enemy forces that has occurred on the Fukien coast of China, and think of the attempts by the Communist Chinese to seize the off-shore islands of Quemoy and Matsu, and the possibility that this will lead to a conflagration in the Pacific area. We must realize not only that the Nationalist Chinese are our friends but also that their capital, Taipei, is the best listening post apart from Hong Kong through which we can learn what is going on behind the iron curtain in mainland China. All these things are important, but it is important above all that we should show the Chinese who are spread throughout the Asian countries that we stand firmly behind the Chiang Kai-shek regime, and that we recognize that the Nationalists are our friends and that our fate is intimately linked with theirs. The destruction of the Chiang Kai-shek regime would mean the destruction of Korea and the beginning of a conflagration that would in fact destroy Australia. We have to recognize, Sir, that all the anti-Communist countries in Asia and on the western side of the Pacific must stand firmly together and present a united front if Australia is to survive. The need to ensure our survival should be uppermost in the minds of all members of this Parliament. So long as we consider that Australia’s survival can be taken for granted, we shall be neglecting the situation that is developing to our immediate north.

I know that the United States of America has intimated to the Austraiian Government that that country would welcome any action by Australia to establish a diplomatic mission in Taipei. We know that the United Kingdom has such a mission there. We know that we should have one, and there must be some reason for our not establishing one that is not being made public and is not being made known to the members of the Government parties. It is being made known to neither members of the Parliament nor the people. This is a question that the Government must answer in the immediate future. By appointing either a diplomatic mission or a trade mission to Taipei, Sir, we should in fact be giving de jure recognition to the Chiang Kai-shek regime, and we should be meeting our responsibilities as one of the free countries in Asia.

Mr HAYLEN:
Parkes

.- Mr. Chairman, I should like to pursue the arguments advanced by the honorable member for Lilley (Mr. Wight) a good way along the path on which they lead, but I had decided, before I rose in my place, as they say in the classical language of this chamber, to make a moderate and uncontroversial contribution concerning the Republic of Indonesia and the very difficult situation that is developing there, with particular reference to the misunderstandings that have arisen, in order to see whether we, as members of the Parliament of the Commonwealth of Australia, cannot do something to bring about better relations between the peoples of the two countries, who live so close together. East of Malaya, west of New Guinea and north of Australia are the islands of Indonesia - 3,000 of them, including the larger islands that we all know of. The political situation in the islands of Indonesia to-day is almost as confused as they are geographically. We are inclined to get emotionally involved in the situation without having a full knowledge of it, and we are inclined to make statements of firm decisions to do either this or that or to resist one move or another - statements which might involve us in conflict entirely unnecessarily.

Two important observations about the Indonesian situation have been made in this chamber to-day. One was made from this side of the chamber by the honorable member for Lang (Mr. Stewart), who suggested that, in these troublous times, we should resort to negotiation, which is the basis of the United Nations and of our peacemaking machinery. He suggested that President Soekarno of Indonesia should be invited to Australia at an appropriate time to discuss his country’s problems - not only trade problems, but also the problems of rehabilitation and development that face a native race emerging from colonialism after so many centuries - and the question of what the Indonesians think to be their legitimate aspirations in regard to territory and the extension of the new republic. I think that is a splendid idea. We have had visits from Mr. Kishi, the Japanese Prime Minister, from other people from the Archipelago of Indo-China and elsewhere who are to my mind rather suspect, and from many people who are true friends. They have come to these shores to discuss and promote the cause of peace.

The original good that came out of the United Nations, if not its best opportunity and, indeed, its only work, could best be exemplified by a committee on Indonesia. I think that perhaps we ought to get together at some level and discuss these problems which divide us in regard to Indonesia, or the questions which could resolve themselves into highly dangerous and contentious ones. Before the governments of these countries become terse with each other, or before the people become emotionally involved from reading newspaper and magazine articles and much comment that is more or less ill-informed, we ought to know what were the facts on both sides. I think that the suggestion made by the honorable member for Lang is indeed a good one. If we do not have President Soekarno himself visit us, we should have some of his ministerial officers come here and give us the Indonesian point of view. We, in turn, could explain the Australian point of view.

The second important remark about Indonesia made in this chamber to-day was made by the Minister for Defence (Sir Philip McBride), in his capacity as acting Minister for External Affairs. He said that, on Thursday last, the Indonesian Minister in Australia had called on him personally in relation to the troubled situation over the eventual allocation of West New Guinea. The Indonesian Minister said that he had been asked by the Indonesian Prime Minister to inform the Australian Government that there was no thought of violence or of active aggression in relation to this problem. This puts the matter in an entirely different light. Last week, there was a dramatic change in attitudes towards Indonesia. The Americans are now selling arms to the Indonesians. Formerly, the allegation was that red China was selling them arms, but it is now an established fact that the Americans are doing that very thing. As a result of this, the whole situation in Indonesia has appeared in a different light, and we should pause for a moment and get the facts straight. It would be better for all concerned if we did this before we start arguing violently or belligerently about who is going to possess West New Guinea.

The Indonesian people require aid at this moment. Among the cries for Merdeka - the cries for freedom - we hear also an insistent cry for some help from outside. Indonesians need aid more than any race in Asia at the present time, and I believe most firmly that we should extend the operations of the Colombo plan to the Indonesians, in a friendly gesture, in order to put their country upon its feet in a financial sense. Those who in the past have said, “ Indonesia was Dutch territory; it has been wrested from the Dutch; the Indonesians are now in charge and they sink or swim according to their own activities “, are not learning the lessons of history. You cannot turn back the page. There is now a republic of native-born Indonesians. The people themselves have thrown off their colonial bosses, the colonial yoke as it is popularly called, and are now endeavouring to march with the rest of the world. It would be not only useful, but Christian and humane, if Australia, one of Indonesia’s neighbours, adopted a comprehensive and ^sympathetic attitude towards that country.

I suggest that as an alternative to angry cries of “ Hands off New Guinea “. The West New Guinea issue has been brought into the ambit of controversial issues, and eventually, like all such issues - for instance, that of Korea - it will have to go to the conference table of the United Nations. We ought to make some preparation for that now. I do not know what is running through the minds of members of the Australian Government, and I am not sure what is in the mind of the Australian community with regard to this matter, but I think I can say that none of us wants war over any issue relating to a country to the north of us.

Therefore, we have to start to establish goodwill between ourselves and our neighbours. We should remember the Christian community in Indonesia. We should remember the Moslems there. We should remember the tribal chieftains, the rajahs and maharajahs, and the complex composition of the population of this great blanket of islands. Remembering those things, and having in view the effects of the different grades of culture of these people, this is a clear case in which we can move in, as a nation with a great secondary industry and as a nation with great influence in this South-West Pacific area.

As the honorable member for Lilley (Mr. Wight) says, we have plenty of friends. We know we have plenty of friends, but what is wrong with our having more friends? In Indonesia we have a classical opportunity to do something useful for the preservation of peace in the Pacific and for the economic development of a close neighbour. We can divert that country from the aggression which will result in the long run unless there is a proper understanding. For these reasons, the invitation to President Soekarno suggested by the honorable member for Lang is a sensible one. The suggestion emanates from a young “ digger “. I am pleased that it was made by him, and I congratulate him on it. The statement by the Minister acting for the Minister for External Affairs is also reassuring.

The situation with regard to Indonesia is a challenge to us to do something in the way of negotiation, and the best and most practical way to approach negotiations is to show some concern for the sufferings of the people.

Indonesia is practically broke. Its monetary system has been subjected to grave assaults. Its trade has been the victim of various unhappy circumstances. To-day it stands at the crossroads. It can be assisted in its rehabilitation by experts, by understanding and by the proper use of the Colombo plan. In devising a plan like the Colombo plan to cover Indonesia - and this could be organized through the United Nations - we can get down to the conference table, and eventually, by a series of moves of this nature, bring the whole Indonesian situation before the United Nations for consideration.

After all, Indonesia is trouble spot No. 1 in the world to-day. Consideration by the United Nations is a slow process. This is at once the United Nations’ greatest advantage and its greatest disability. Peace comes very slowly. It is a tenuous and a tender thing and has to be nurtured. The long negotiations at the United Nations have a tendency to take the heat out of a situation. You sort of talk it out, which in the long run is all to the good. It is why the United Nations has persisted, despite many setbacks. This suggestion seems to me to be a logical answer to the Indonesian problem.

I refer now to West New Guinea, and the question whether the Dutch should have evacuated the whole of their territory in this area. They have retained this arid piece of New Guinea which does not mean much, except as a point of prestige and, probably, a point of return. We can understand how the Indonesians feel about this matter. We can also understand how Australians feel about New Guinea. Although it is a trust territory, it is more than a trust to Australians. There is a sacred nature in the trust, because many of our men died in New Guinea repulsing the invasion of the Japanese and resisting their schemes for the introduction to Asia of their own particular brand of culture and development. Instead of rattling the sabre and puncturing the air with slogans and denunciatory phraseology about what may happen in relation to New Guinea unless we get our way, we should be as reasonable as we expect other people to be.

The prize is a tremendous one. It is peace and understanding, not for us, but for the generations of the future. We can build in Asia not only a strong goodwill, but also a goodwill which is of an enduring nature. I suggest, as I have said briefly in the few minutes at my disposal, that there is a practical way to do this. The first step is to take the heat out of the argument by exchanging visits. Let us have the Indonesians here to tell us what they think of the problem, without inhibitions. Let us also have a look at them in return and discuss with them our problems - and pull no punches in the association. Out of that, something important and useful will, I am sure, emerge.

One does not allow a ship to sink or to be scuttled for want of a ha’porth of tar. We can, to our own benefit - because we build goodwill and bridges for future trade - do something about the position in Indonesia. Let us have their trade authorities here, their economists and their scholars and teachers. We have an opportunity to teach many of their young men here and to send them back to Indonesia, as we have sent back other young men to other Asian communities, to explain what Australia stands for, and to be ambassadors, in many cases, for our way of life. I believe that we can extend this scheme. We can make ourselves ambassadors-at-large of goodwill by adopting a calmer approach to this problem.

If one read the newspapers during the last few weeks, one would have thought that war was imminent, that the whole of the Pacific was about to erupt again in a conflagration greater than the last. Nothing is further from the truth. The message given to us so conservatively and calmly by the Minister acting for the Minister for External Affairs was to the effect that the Indonesian Minister has stated, “ We are seeking peaceful ways for the solution of the New Guinea problem “. Conversely, our attitude is one of peaceful negotiation and the extension of the Colombo plan to assist a neighbouring country with a population of many millions. In the long run I believe this will be the most useful and sensible policy to adopt. We must build up the United Nations. We must, in the troubled Pacific, which is now the ocean of conflict, and in an Asia which is now the yeast pot of world affairs, use our common sense and our judgment. We must use the United Nations. Unswerving loyalty to the

United Nations is the keystone of the policy of the Labour party, and I think it is advocated by most Australians. 1 hope that we will approach the problem of Indonesia in a commonsense way, without any jingoism or chauvinism, and without any emotional appeals through newspapers or other channels. The stake is friendship with the Spice Islands, historical Indonesia. The stake is prevention of a third world war, and the rewards are to be found through the United Nations, through negotiations and the friendly understanding of the problems of our neighbours to the north, who are not like the great imperial Chinese race, which has had a well-known and documented history. Indonesia has a history, of course, but it is one in which the worker and the ordinary Indonesian do not share. To-day the Indonesian nation emerges as one of the new nations of the world, and we should treat it with all the concern and consideration that we can bring to bear, so that it may become a peaceful member of the community of nations. Indonesia’s aspirations should not be laughed at and its desires should not be conceded reluctantly only where there is force to support them.

I think that the continual stories about the huge air force that the Indonesians have and the number of men that they are raising should, perhaps, be discounted freely. They should be discounted in the light of the experience of any man on either side of the chamber with any knowledge of the Pacific war. How many ships did it take to make even a small landing on a very small island? Two or three thousand were required to go to the Philippines, and 250 for the least foray under General MacArthur. There is talk of movement towards New Guinea. Perhaps there is some infiltration or action of that sort, but undoubtedly the reports are much exaggerated.

The CHAIRMAN:

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

Mr DEAN:
Robertson

.- Earlier this afternoon, the honorable member for Lilley (Mr. Wight) made a plea for an increase in allowances to the personnel of our diplomatic posts abroad. While I have not had the opportunity of personally visiting a great number of these posts in recent years, I have had the opportunity of seeing some in South-East Asia, and I think that the high level of our representation by the personnel in those posts reflects a great deal of credit not only on the officers themselves but also on Australia. I agree with the statement of the honorable member for Lilley that some of our officials suffer a disadvantage in comparison with those of other countries in regard to the allowances paid to them for their representation. I think it is unnecessary now to go into detail. The honorable member did give some itemized examples. All I wish to say is that what he said exactly coincides with the opinion I formed from my own observations. I support his plea for the Government to have a look at this matter and see whether it would be possible to increase the allowances made to our personnel in these areas.

The honorable member for Parkes (Mr. Haylen) has said quite a deal about Indonesia. I should like to refer to one or two matters that he brought up. I quite agree with some of what he said. He suggested at one stage that we should give Colombo plan aid to Indonesia. I think that for quite a number of years we have been extending that aid.

Mr Haylen:

– We did, but we do not do it any longer.

Mr DEAN:

– Only in recent times I saw a fleet of new Australian buses running in the streets of Djakarta.

Mr Haylen:

– There has been an interruption to the aid.

Mr DEAN:

– As far as I know, there has been no interruption. Certainly the flow of students from Indonesia to Australia has been maintained. I do agree with the honorable member’s statement that whereever possible we should increase the interchange of visitors. Whether Indonesia is more important that other countries in South-East Asia, I should not like to say. I do not think that it is possible to establish a priority in these matters. 1 remind the committee that quite a number of members, including myself, have in past years asked the Government to send parliamentary delegations to various countries abroad, and especially to countries of South-East Asia. Therefore, it is very pleasing that the number of visits has increased in the last few years. Annually, we send a delegation to a selected country under the auspices of the InterParliamentary Union. I believe that the delegations from Australia have done a lot of good, not only by their own representation in makin? the Australian viewpoint known, but also by personally making contacts and assisting people who have not had an opportunity of visiting this country to know something of it. The only comment I make in regard to our representation at conferences of the Inter-Parliamentary Union is that so far we have been sending a delegation of only six. My understanding of the situation is that, pro rata to our population, we are entitled to send ten delegates, and I think it is a great pity that we cut short the number in our delegations and do not take full advantage of the opportunity for members to travel and so enlarge their personal experience and extend their contacts.

One other reason why our delegations should be at full strength is that other countries set great store on the importance of proceedings of the Inter-Parliamentary Union, and when the Australian delegation arrives four delegates short, those countries immediately think that this country does not set the same importance upon its representation on that body as they themselves do. Therefore, I bring that aspect (o the notice of the Government. While being thankful to the Government for initiating our representation during the last three years, I say that we should take a full delegation to the countries where conferences are being held.

I should like to make one more comment on the remarks addressed to us by the honorable member for Parkes. He expressed regret at some rattling of the sabre that he claimed had taken place in regard to relations between this country and Indonesia. As far as I know, there has been no rattling of the sabre from this side of the chamber at all. The honorable member referred to statements by a section of the press - I am glad to say a very sma section - which has tried to promote in the public mind belief in the existence of a situation between Australia and Indonesia, which we in this place know not to exist. I agree with the honorable member’s statement that it was very good that the Minister acting for the Minister for External Affairs was able to-day to give the answer he did give in reply to a question.

I want to return to this matter of extending our visits to other countries, especially to those of South-East Asia. 1 think it is necessary for parliamentary visits to be increased. After all, when one looks at the successful commercial and manufacturing enterprises in Australia, one sees that they realize the great benefits that flow from sending their personnel abroad. 1 can think of a number of such organizations which always have a group of their staff abroad. No sooner does one group arrive back in Australia than the next group sets out. As can be seen, great expenditure by the Government is not involved in sending these delegations abroad.

I do not think that these visits should necessarily remain the prerogative of members of Parliament. Therefore, I was very glad that we initiated a trade delegation to South-East Asia a few months ago, which was led by the honorable member for Darling Downs (Mr. Swartz), and comprised representatives from a number of commercial and manufacturing organizations. The reports on that visit, both from the delegates and from the countries they visited, are most encouraging.

I think that we could well promote and take an interest in visits by another group. I refer particularly to the service clubs of Australia. By service clubs, I mean the Rotary Club, the Apex Club, chambers of commerce, and junior chambers of commerce - organizations which work towards community service. Some of them originated outside Australia, but, owing to their spread in Australia, they have indeed become Australian institutions. Others, such as the Apex Club, are entirely Australian institutions, having originated here. It is good to know that branches of those organizations are being formed by our neighbours in South-East Asia.

I believe that this free assembling of people with a common objective to give service to their community is one of the greatest weapons that could be used against the infiltration of those countries by Communists. Therefore, it would be to their advantage, as well as to ours, to assist in the promotion and formation of these clubs.

There is an item in the Budget which refers to the money to be spent on Asian visits, and I should like to ask the acting Minister for External Affairs whether it would be possible for us to assist such organizations as I have referred to under that heading. As we know, in many cases the members of the organizations are comparatively young men with young families, and the greatest expense in these visits abroad is involved in the fares. Once we can make arrangements for them to arrive in the country abroad, their expenses are not high because their hosts are most hospitable and take care of them. They also arrange their itineraries, but the great item of expense is the return fare from Australia to any one of those countries. Although we refer to them as our near neighbours, they are far away compared with the distance between countries within the European boundaries, for example.

I direct the attention of the Minister to these suggestions and hope that he will give consideration to them because I believe the future of Australia is being closely linked very quickly with the future of the countries of South-East Asia. Anything we can do to promote greater personal contact and the expansion of trade between ourselves and those countries will be to our mutual advantage.

Mr BIRD:
Batman

– I wish to refer to Division No. 217K. - International Development and Relief - under Miscellaneous Services. I regret that this year there has been a decrease in the proposed vote for the Colombo plan. The appropriation last year was £5,345,000, which was provided for economic development and technical assistance. Of that appropriation, actual expenditure was £4,997,259, or about £300,000 under the allocation. This year the appropriation for the two sections of the Colombo plan I have mentioned is £4,300,000. That is about £1,000,000 under the allocation for last year and £700,000 under what was actually spent. That is regrettable, because we have reached the stage in our relations with South and South-East Asia where an increase, and not a decrease, in the allocation would have been more appropriate.

As a matter of fact, ever since the Colombo plan was initiated in 1950, the expenditure has been below what was envisaged at first. The plan was supposed to extend from 1950 to 1957 and, over that period, Australia contracted to spend £32,500,000, but I vouchsafe the opinion that, by the end of 1961, at the present rate of expenditure, we will not have spent £32,500,000 over eleven years. This matter was discussed last year, and the Minister for External Affairs (Mr. Casey) informed the committee that we had spent between £17,000,000 and £18,000,000, and an expenditure of £3,000,000 or £4,000,000 more was in prospect over the next year or so.

I cannot understand why there is a continual lag in expenditure on the Colombo plan. It could be justified in the early stages of the scheme when the Government did not know what was required in the way of economic or technical assistance, but, as the plan has been under way for eight years, one would think that the Government would have had sufficient experience to make sure that the money that had been allocated by the Parliament was spent. After all, the money that we allocate is only a drop in the ocean, and it is deplorable that we do not spend even the meagre amount that is placed on the Estimates for this purpose.

I do not know whether the Government has wilted under public pressure in deciding to reduce the allocation by £1,000,000, because some newspapers have been opposed to the Colombo plan. Statements have been made from time to time by various public authorities that this money should not be spent in South-East Asia but in the environs of Australia. I cannot subscribe to that point of view because I think that money spent on the Colombo plan is a practical contribution towards the maintenance of the sovereignty of Australia. Whatever money is spent on the Colombo plan will pay dividends a hundred-fold in the years ahead. I regret, therefore, that, for reasons that the Government has not seen fit to divulge, it has decided to spend £1,000,000 less than it provided last year.

I cannot imagine that the recipient countries would have informed the Government that they do not want money spent on economic assistance, because everybody knows that the economic resources of the recipient countries are in such a state that they are practically totally bereft of machinery, hydro-electric power, irrigation and similar utilities. That is the reason for the plan. It was designed in the first place to provide such essential facilities and to lift the standard of living in the countries concerned. I cannot imagine that those countries would suggest that they do not want the full allocation this year.

If the Government cannot spend the money on economic assistance under the Colombo plan, why not spend it on the technical co-operation scheme which is definitely paying dividends? I am pleased that this year, although there has been a decrease in the allocation for economic development, an increase of £300,000 is contemplated in the appropriation for technical assistance under the Colombo plan. I congratulate the Government on that provision, but we all know that Australia could take more students from overseas if provision were made in the technical schools and universities for them. If the Government could not spend the appropriation for the Colombo plan on economic development, why was it not spent on extensions to universities and technical schools to make additional provision for students from the Colombo plan countries?

It cannot be said that there is nothing on which to spend the money. At this juncture, the technical assistance section of the Colombo plan is more important than economic development. I cannot understand why the Government adopted such a miserable outlook and said, in effect, “We are not going to spend the money on economic development; therefore, we will not spend it on technical assistance “. If more had been spent on technical assistance, we would have had more ambassadors for Australia returning to their native lands at the end of their training. If there is anything we want from the countries of SouthEast Asia it is goodwill towards us. There is no more practical way of bringing that about than the technical assistance scheme under the Colombo plan.

Although I have been a supporter of the Colombo plan since it was inaugurated in 1950, I am prepared to concede that it has not been perfect in every respect. Over the past twelve months, serious allegations have been made about waste in connexion with the Colombo plan. When those allegations were made, the Minister for Exter nal Affairs did not do justice to the plan in replying to them. He outlined, in a sketchy sort of way, the details of achievements under the Colombo plan. I thought that he would have made a categorical denial of the allegations because there are too many persons in Australia who want to snipe at the plan. The Minister should have justified the expenditure on it by saying what had been done in relation to specific activities about which the allegations were made.

In the past six or eight months, Mr. R. E. G. Cunningham, a sheep and cattle station manager who had worked for four years in Pakistan on behalf of the United Nations Food and Agricultural Organization, returned to Australia from Pakistan alleging that Australia had wasted millions of pounds on impractical Colombo plan aid to Pakistan. He said that 50 water pumps of the wrong type and two complete artificial insemination units had never been used. He also said that 215 tractors too big to be used on Pakistan farms were going rusty in the fields. And so on! All the Minister for External Affairs had to say in reply to that was that the true story was very different from that given by Mr. Cunningham. He made no further comment. I looked in vain for a report in the press of a refutation by the Minister of Mr. Cunningham’s allegations, claiming that Mr. Cunningham’s allegations were either incorrect or exaggerated, but nothing appeared.

I think it is most unpalatable for people who support the Colombo plan to find that either such allegations are not shown to be incorrect or that, if they are not denied, no apparent action is taken to correct the situation which produced them. The allegations made should not have been answered in any general fashion. They should have been answered categorically. So far as I know, that was not done. I regret that the allegations were not answered in detail, because I support the Colombo plan, and I say that if there has been waste we should attempt to correct the position.

I had a conversation with some members of this Parliament who attended the Commonwealth Parliamentary Conference in New Delhi some months ago. They told me that during their travels in India and Pakistan they saw tangible evidence of serious waste in connexion with the Colombo plan. They said that they saw, rusting away in many fields, tractors such as those mentioned by Mr. Cunningham. They told me that in many instances blades had been taken from tractors and threshing machines, the remainder of the machines being left completely unused to rust away for possibly the next fifteen or twenty years.

These facts are to be deplored. The Government should recognize that the plan has not proved to be 100 per cent, efficient, and should act accordingly. Admittedly, the human element has to be contended with in connexion with plans such as the Colombo plan. The plain fact is that many of the people in the undeveloped countries of Asia have no proper appreciation of the worth of and the use and maintenance of machinery. The Government would have done far greater service to the Colombo plan had it admitted that waste was occurring, as seen by members of this Parliament on the spot, and taken steps to prevent the continuance of such waste. I hope the Government will make an effort to see that action will be taken to prevent waste under the Colombo plan and to make the plan efficient so that it will provide the greatest possible tangible benefits to all concerned with it.

I am sorry that the allocation for the plan is to be reduced instead of being increased, as I think it should be. I make no apologies for that statement. I think that in the present conditions in Asia the Colombo plan and international relief efforts generally must be expanded by the Western world. Every effort must be made by Western countries, including Australia, to adjust the economic standards of Asian countries to modern techniques. This would not only elevate the prestige of the Western world in those countries but would also improve the standards of the countries concerned. Raising our prestige in Asia is of incalculable benefit to us, and will possibly be of even greater benefit to us in the years that lie ahead.

If we were to increase our economic aid to Asian countries we would provide an enduring basis for the expansion of the world economy at a rate which must benefit both the contributors and the recipients of aid. In other words, for every million pounds we put into schemes for aid to Asia we will receive in return cash dividends quite apart from receiving the benefit of the goodwill for ourselves that we engender in the countries we assist. The Government should take cognizance of this fact. I say that whatever the cost of aid directed towards the economic development of the undeveloped countries of Asia may be, it will be far outweighed by the political and economic advantages we shall derive as a result of giving it.

We are reaching a very dangerous state in some of the South and South-East Asian countries. Modern discoveries in health and surgery, particularly those which have prevented the epidemics that used to sweep like wildfire through Eastern countries, have let to a record increase in the populations of Eastern countries. This means that there has to be a concerted effort by the governments of those countries to maintain even the present standards of living. This is a most baffling problem for the governments of Asian countries. We are told by those who ought to know that the population of Asian countries will double itself by the end of this century, so it is obvious that the governments of those countries have a herculean task ahead of them.

If we wish to develop mutual respect between us and the massive populations of South and South-East Asia we have to do all we can to assist them. I say that taking £1,000,000 off the grant this year will not have this effect. The problem of all the Western countries is that every one of us must make the greatest possible effort to help the Eastern countries, whatever the physical cost of doing so may be to ourselves. Professor Copland said recently that for the next five years the Western countries should devote one-half of one per cent, of their national incomes to assistance for South and South-East Asian countries. That suggestion should be considered very seriously.

The Colombo plan is to be reviewed in 1959. I hope that when it is reviewed there will not be the smug complacency that we have seen emanating from Colombo plan conferences of the past. Every twelve months a conference of the Colombo plan countries is held in the Pacific area. I think that the next conference will be held in the

United States of America. After each conference we are issued with a very comprehensive report which states, in effect, that in the main everything is going well with the plan. I would say that in the present circumstances that is not the case because, as I said before, we have had examples of machinery allowed to lie rusting in the fields. We have not spent in eight years the £32,500,000 that we were supposed to spend on the plan in seven years. In fact, we have not yet spent £27,500,000 on the plan. I cannot see that the Colombo plan has been successful so far as Australia is concerned.

Mr BURY:
Wentworth

.- The honorable member for Batman (Mr. Bird) seems to harbour a number of illusions about our capacity to assist South and South-East Asian countries under the Colombo plan. Broadly, at a time when our overseas funds arc falling fast and are likely to fall very much further in the next year, it is quite an illusion to imagine that we can, by throwing in economic aid to South and South-East Asia, either win very many friends or influence people. The United States has already been to some extent disillusioned on that score. That, Sir, is of course no reason for failing to proceed with Colombo plan aid. The basic point is that the aid that Australia can give to Colombo plan countries generally amounts, in broad economic terms, to a negligible amount in comparison with the magnitude of the problems of those countries.

But do not let us imagine that the West is doing nothing about this. In fact, the amount of foreign aid, in one form or another, going into the area has shown a tendency to increase. The United States has given very large sums to various countries in the area, and in recent months lending by the International Bank to eastern countries has also been stepped up. In regard to our own contribution the honorable member for Batman criticized underspending. Any one who has had anything to do with programming foreign aid knows that it is extremely difficult to forecast what expenditure will be required. The Colombo plan itself operates on the basis of requests from the recipient countries, and the rate at which they will be received cannot be predicted. Neither can we predict the extent to which particular demands can be met. So it is reasonable to expect that any forecast of Colombo plan spending may fall quite wide of the mark. However, the change provided for in the Estimates is surely a very sensible one. There is to be a not very appreciable reduction of the amount of economic aid, but there is to be an increase in the provision of technical assistance, lt is in technical assistance that our biggest contribution can be made. Of course, the honorable member for Batman wishes to increase it, but it is a fact that our own universities and technical training facilities of the kind required for this purpose are already taxed to capacity. We, ourselves, are up against lack of facilities and finance for the training of our own people.

When I last inquired, I found that 4,000 Asian students were being trained in this country which is a very big effort on the part of Australia in view of our somewhat limited facilities. The big contribution that we are already making should not be overlooked. I am sure that we, on this side of the chamber, will support any further reasonable increase in the technical assistance programme because we can make a much more effective contribution to these countries both in goodwill and, eventually, in effective economic development by training rather than by direct aid.

It has been stated that there has been a certain waste of capital equipment supplied to some of the recipient countries. This is only natural. These countries have not highly developed administrations as we have, and our own public spending is by no means wholly devoid of waste. But we should not be misled by reports which are bound to come in from time to time that particular items of equipment that have been supplied have been wasted.

The honorable member for Bonython (Mr. Makin), who is entitled, by virtue of his experience, to a very respectful hearing on these matters, referred to the constant absence from this chamber of the Minister for External Affairs (Mr. Casey). He should know that under modern conditions that is quite inevitable.

Mr Makin:

– I said that.

Mr BURY:

– Yes. But the honorable member for Bonython forgets that when he was playing Box and Cox with the right honorable member for Barton, then Minister for External Affairs, he was at the time a senior member of the Cabinet. Any one who, even for a short time, is responsible for the conduct of our external affairs, whether at home or overseas, must be a senior Cabinet Minister because only a man in that position can properly speak for Australia and give the necessary day-to-day instructions to the department. This problem is largely overcome by the present acting Minister for External Affairs (Sir Philip McBride), who is well versed in these matters. He has acted as Minister for External Affairs on many occasions, and is well able to keep abreast of events. Unfortunately, the solution which the United Kingdom has reached of having a separate minister to go to the United Nations is not practicable here because, within our external affairs framework, constitutionally we can only have one Minister.

The honorable member for Bonython also raised the question of allowances. It is curious that there is quite a variation in the basic salaries of our overseas representatives. I realize that salaries are only part of the remuneration and that the allowances which vary from post to post, have no bearing on salaries. But, it is curious, for instance, that the salary listed for the High Commissioner in Pakistan is £300 more than the salary listed for the High Commissioner in India; and that the salary for our representative at the United Nations is apparently £100 per annum more than the salary for the Ambassador to the U.S. The Ambassador to Japan wins out in this round. He receives a salary which is about £500 higher than the salary of the ambassador in Washington. I suggest that this is rather a curious feature of the salaries of these gentlemen. No doubt, in some places, it could be taken as a measure of their relative importance. As I have said, allowances vary enormously. The Australian ambassador to Washington, in the aggregate, would undoubtedly draw much more than any of our other ambassadors. That is largely because of expenses. There is also the tax factor. It is curious, however, that there should be such apparent anomalies in the salaries of ambassadors. The Public Service mind is much concerned with these odd hundreds of pounds differences, because they do in some curious way denote prestige.

I should like to say a word or two about accommodation of overseas personnel, i believe that this may be a more important question than their allowances, because we already have machinery within the Public Service Board for fixing allowances. The Public Service Board has experienced officers who travel around, assess the situation and, insofar as they can assess proper allowances, this is already done. Ti is true that many countries pay their representatives more than we do but others pay less. If there is some scope for reform in this field it would be through a getting together of various authorities in like-minded countries who fix these allowances to compare notes and experience because in practice there is considerable competition between one embassy and another.

With regard to the accommodation of personnel, we do, in most important posts, at least, provide a house for the ambassador. But there are a number of places where members of the ambassador’s staff do find life extremely difficult. For instance, the counsellor in Washington, on many occasions, has to act for the ambassador who is frequently an itinerant, visiting other parts of the country, say New York or the Mardi Gras in New Orleans. Therefore, in many cases the counsellor has to bear a very considerable burden of representation and entertainment. In mentioning the Mardi Gras I did not have in mind particularly the honorable member for Bonython, but certainly some other ambassadors, in the course of their duties, have found their way to that delectable spot. The counsellor in Washington has had, at times, a very difficult role to fulfil in adequately representing us.

In any case, throughout many of our posts we pay considerable allowances for housing purchases and the position of many of our officers is made extraordinarily awkward because of the lack of housing and the inadequacy of the rent allowances in some cases, although they are excessive in other cases. But we need to adopt a long-term policy of providing adequate accommodation befitting the status of the officers in the various overseas posts.

We have made some progress in the Asian countries in this respect because circumstances have compelled us to do so. But we should look around a number of other posts. Our ambassador to the United Nations, for instance, who is one of our most important functionaries these days, still has no permanent accommodation. When a new ambassador is appointed he has to spend his first few weeks in New York searching for accommodation. While a man and his family are not properly accommodated, or are in temporary premises, it is extremely difficult for him to function effectively and keep his mind on the job and do the measure of entertainment that should be done. I suggest, therefore, that an early priority should be given to the provision of a residence for our ambassador to the United Nations. In the long run, this would be very much cheaper for the Commonwealth than paying heavy rent subsidies.

There is also a very curious position in South Africa, where the Government is administered from Pretoria but the Parliament meets in Capetown. We have made provision for a high commissioner’s residence in Pretoria, but when the unfortunate high commissioner goes to Capetown, to be around when Parliament is meeting, he has to do all his entertaining in the hotel. In Capetown, when parliament is sitting, every hotel and other place of accommodation is crowded out, and it is extremely difficult for the Australian ambassador there to operate and maintain the proper dignity and functions of his position.

Finally, I join with other honorable members in paying tribute to the very fine work of this department, which is gaining in status year by year as its many still rather youthful officers gather further experience.

Mr WHITLAM:
Werriwa

.- I wish to direct the attention of the committee to one item in the Estimates for the Department of External Affairs, namely, Division 25, Embassy - Republic of Ireland. The estimates of this department detail the scale of Australia’s representation in some 24 countries. The estimates for the Prime Minister’s Department detail the scale of our representation in the United Kingdom, but in respect of the provision for our overseas posts by far and away the smallest provision is made for Ireland. It is less than half that for any other country.

This is all the more remarkable when we consider that Australia, at least until recent years, was developed by the joint labours of people who had come, or whose ancestors had come, from all parts of the British Isles, not only from England, Wales, or Scotland, but also from Ireland. Yet we persist in this grossly disproportionate and, I should think, insulting representation in Ireland! The reason for it is that the Government insists that any representative or ambassador from this country should bear letters of credence addressed to “The President of the Republic of Ireland” whereas the government of that country insists that any ambassador from this country should bear letters addressed to “The President of Ireland “. This stalemate has now persisted for some years. It is plain, from the Estimates with which we are concerned, that the department intends that it persist throughout the present financial year. If I may use a diplomatic term, there is to be no détente between the two countries.

On page 16 of the Estimates the first item appearing under the heading of Division No. 25 - Embassy - Republic of Ireland, is “ Salaries and allowances as per Schedule, page 163, £6,900.” From the details on page 163 one sees that the full amount would have been £13,864, but that it is estimated that an amount of £6,964 will remain unexpended. That is, there is no expectation of a full representation in Ireland in this financial year, just as there has not been for several years past.

Mr Haylen:

– How many persons are there on the staff of the embassy in Ireland?

Mr WHITLAM:

– I inform the honorable member for Parkes, whose lively interest in this matter is well known to us all, that the full staff of the embassy is shown as one ambassador and two External Affairs officers. There is no indication as to what the actual representation will be. It is plain that there will be no ambassador and I believe that there will be only one External Affairs officer.

Let me deal a little further with this impasse between the two countries. I believe that it shows very clearly the Government’s lack of sincerity. This is shown in an answer which the Minister for External Affairs (Mr. Casey) gave to me as far back as 11th October, 1956. When our Queen succeeded her late father, the then Irish Ambassador presented letters of credence to the Governor-General which were signed by the President of Ireland and the GovernorGeneral accepted them. We, however, persisted in sending a new ambassador to Ireland with letters addressed to the President of the Republic of Ireland. I suppose if anybody were going to be sensitive on this point, it should be the United Kingdom. Our Government takes its stand on the ground that if one refers to “ Ireland “ it is to the whole island of Ireland and that this would give comfort to the claim of the republic that the north-eastern provinces should be included within the republic, instead of within the United Kingdom. But the United Kingdom shows no sensitiveness on this point because, as emerges from another portion of the Minister’s reply to me, the United Kingdom addresses letters of credence to President 0’Kelly. that is, to the President of Ireland by name.

It appears, further, from the Minister’s reply that our sister kingdom of Canada sends letters of credence addressed to “ The President of Ireland “. We are being more sensitive and stubborn than the United Kingdom, which is directly concerned. We appear to be more solicitous for the feelings of the United Kingdom in the matter than is the kingdom of Canada, which, of course, owes as much, proportionately, to Irish settlers as does Australia. It seems that as long as the present Australian Government is in office it will persist in this unilateral piece of stubbornness - this spontaneous affront to the Irish Government and this deterrent to Irish re-entry to our Commonwealth of Nations.

In answer to the honorable member for West Sydney (Mr. Minogue) on 27th September. 1956, the Prime Minister (Mr. Menzies) said -

We have taken a view to which we adhere very strongly, and we are not prepared to abandon it in order to satisfy the honorable member for West Sydney - with very great respect to him. So long as the difference remains, there will be no appointment. When the difference disappears, an appointment will be made.

That is apparently where the matter is to remain throughout this financial year unless there is a change of government on 22nd November.

Let me summarize . The United Kingdom does not insist upon its representative to Ireland present) ig letters of credence addressed in the way we insist. Canada does not insist upon it. We ourselves accepted letters of credence from an Irish ambassador whose President signed himself in the way which we now reject. It is an unnecessary affront to one of the countries whose history we so largely inherit that we continue to make no provision in the Estimates for proper representation in Ireland. Although it is well known that Ireland is anxious to re-establish full mutual representation with Australia, our embassy in Ireland is the one for which we make by far the smallest provision.

Mr CAIRNS:
Yarra

.- The Department of External Affairs is involved in discharging in the world to-day the most important and vital work of any government department. The Department of External Affairs makes Australia’s contribution towards the settlement of disputes and disorder that might lead to war in various parts of the world. With regard to the discharge of those responsibilities, I take it that two fairly distinct groups of people are involved. First of all there is the Prime Minister (Mr. Menzies) and the right honorable the Minister for External Affairs, and the supporters of the Government, who, one would expect, might generally have less knowledge, and a less systematic and less complete opportunity to study the questions upon which policy depend. On the other hand are the members of the Department of External Affairs, here and abroad, whose full-time profession it is to provide the Government with an array of facts and information upon which its decisions might be based.

With regard to the first group of people, we have a Minister for External Affairs (Mr. Casey) who has had a long background of association with international problems, and whose name and repute are well known in many parts of the world. We have a Prime Minister who, in the Australian constitutional situation, and in practice, has from time to time been the de facto Minister for External Affairs, and very particularly so in important matters like the Suez crisis, where, it seems to me on the evidence, the decisions made by Australia were made by the Prime Minister without much reference even to the Minister for

External Affairs, and considerably less reference to departmental officers. Then we have, it would seem to me, in the positions of greatest influence among the Government supporters, people, without naming them, whose views are most reactionary and whose statements are most unobjective. In view of those circumstances what kind of relationship exists between the Government, or its influential spokesmen, many of whom take a most narrow and reactionary view of external affairs, and the departmental officials concerned? It would be strange indeed if those departmental officials were to oppose those reactionary and unobjective views of the persons to whom I have referred, bearing in mind the fact that many people are of the opinion that the present Government will remain in office for a long time to come. In view of the need for a more objective and rounded examination of the problems confronting us, it seems to me that Australia may well be under-supplied with objective material and objective analyses of the international problems with which we have to deal.

Mr Forbes:

– This is a reflection on the officers of the Department of External Affairs.

Mr CAIRNS:

– I remind the honorable member for Barker that one must be a little realistic. We are living in a hard world and I know from long experience, although the honorable member may not, that officers of departments do sense the direction and nature of the wind and are influenced by it. I do not want to live in a fairy-like world, and I advise the honorable member to consider the possibilities of my suggestion.

A perusal of the facts might prove enlightening. I invite the committee to study several circumstances that have arisen in recent times. The question before us is: Are we getting, departmentally and otherwise, a sufficiently objective, sufficiently careful, analysis of the vital facts upon which the future of the world may well depend? In order to illustrate the question and enable us to answer it, let me first refer the committee to the subject of nuclear weapons and the testing of them. For some time last year in questions in Parliament, in correspondence with the Minister, and in private conversations with the Minister I discussed the state of scientific opinion with regard to the policing of nuclear tests. I pointed out in those questions, and in the correspondence, that there was a strong suggestion that the decisions being made with regard to those tests were influenced more by the political implications of the decisions than by the nature of the tests. In the last sessional period in particular I dealt with the decision that had been made by the United States Atomic Energy Commission that it was not possible to detect certain tests over any more than a very narrow range. The Minister repeated to me the kind of scientific opinion that I knew from my own inquiries amongst scientists in Australia to be outmoded. Indeed, there was a strong suggestion that it was known to be outmoded. So, when the matter was discussed at the conference at Geneva, I was not surprised when the scientists of all sides assembled there reported that it was possible to set up a system to detect tests adequately, a situation which, according to the opinion that I had been able to obtain, was possible at any time during 1957. In view of those facts, what sort of information did the Minister for External Affairs and the department have, because as far as I am aware there are no nuclear scientists in the department? Just what sort of information did the Minister have, and were the Minister and the department accurately informed that a scientific opinion was held by people of first-class repute that the situation was different from that which was represented to the Government by perhaps its accepted scientific advisers, whoever they might have been? Now, apparently, there is no great difficulty in this field. I cite this example to show the extreme difficulties associated with scientific advice. I realize those difficulties, but I want to move on to other topics.

I should like to direct the attention of the committee to the Suez Canal crisis. It would appear that the decisions arrived at by the Australian authorities were made on several assumptions - and I am not sure whether the Minister for External Affairs had much to do with the matter at all. One assumption was that President Nasser of Egypt was extremely insecurely placed in Egypt and that very little in the way of intervention would be required to dislodge him from office. The British Foreign Office had strong evidence to the contrary, but a certain course of action - that is, the landing of troops in Egypt - was adopted. That action was consistent only with the assumption that all that would have to be done would be to take action of this sort and Nasser would be swept from power. The second assumption that seemed to be underlying the intervention was that the Egyptians would not be able to operate the Suez Canal if they were left with the responsibilities themselves and that either the canal would cease to function and world trade flowing through it would be cut off or the Egyptians would deliberately block and destroy the canal.

It seemed to quite a number of observers at the time that neither of these assumptions was justified. A letter in the London “ Times “ from a former naval commander reported how he and many others who had no experience of navigation in the canal had from time to time been able to take vessels through under all circumstances. The assumption that the Egyptians could not do this was coloured more by a feeling of the superiority of whites and the inferiority of Egyptians than by an examination of the actual circumstances. I want to know whether it is possible to find out - I do not think it is, because the Government never worries about answering any of these questions - how much our own decisions are influenced by such ideas. Of course, we know that the action taken in Suez was completely unsuccessful and that the decision to take such action was based upon wrong information.

So much for Suez. I. turn now to the question of the more recent’ policy in regard to Lebanon and Iraq. Here, evidence is now accumulating that the Western Powers accepted two assumptions. I am suggesting that in the case of Suez they under-estimated Nasser. I am suggesting in the present situation that the Western Powers greatly over-estimated Nasser, and that they greatly over-estimated the strength and influence of communism in the Middle East. As a result, the Western Powers concluded that the problems in Lebanon and in Iraq were predominantly caused by influences from outside. They believed that, if they could land troops, the internal situation would not provide any obstruction or any difficulty with regard to those troops, and that by the use of the troops, the external influences would be neutralized. I am suggesting that, first, the external influences were greatly over-estimated, and, secondly, the internal situation was not one in which a strongly pro-Nasser or even Pan-Arab influence was at work. Certainly, a strong Communist influence was not at work. I believe that these ideas fall upon ready ears in certain places in this Parliament, because people here have a motive to play up and overemphasize the significance of communism and of threats to peace that are represented by such things as Arab nationalism.

After having gone to the trouble of landing troops in Lebanon and in Iraq, it is found that the internal situation in both countries is not one with which it is impossible for us to deal. The Iraqi revolt which overthrew Nuri el Said, whom the Minister for External Affairs claims as a friend, installed a government which we were ready to recognize.

The TEMPORARY CHAIRMAN (Mr.

Lawrence).-Order! The honorable member’s time has expired.

Mr KILLEN:
Moreton

.- The honorable member for Yarra (Mr. Cairns) came to this Parliament commanding something in the nature of a reputation as a lecturer. I am bound to say, Sir, that he will leave this Parliament with his reputation as a lecturer enhanced in one sense but shattered in another. For the last fifteen minutes, he has lectured the Parliament on external affairs and intimated to those of us who sit on this side of the chamber that we are, first, reactionary if we do not completely agree with his views. Secondly, he suggested strongly that we are not objective if we do not display the same affection for doctrinaire leftism as he has amply portrayed since he has been in the Parliament. He told the honorable member for Barker (Mr. Forbes); who interjected with characteristic courtesy, that he was unrealistic and that he, the honorable member for Yarra, was the only realistic person in this place. Then, in a slighting fashion, he turned upon the officers of the Department of External Affairs and questioned whether they were keeping themselves abreast of what was happening. He then turned to the members of the Parliament and wondered whether they were being completely objective. Sir, what an inglorious display of humbug!

We know precisely where the sympathies of the honorable member for Yarra lie. His attempts to disguise them are of no avail. He sneered at members of this Parliament and said, “ I need not bother to mention any names “. If I had asked whether he referred to the honorable member for Mackellar (Mr. Wentworth) and to me, he would have said, with the snappy wit that he commands, “ Of course, if the cap fits, wear it “. That is the trait that he has displayed since he has been in this Parliament. This afternoon he gave a miserable exhibition. He did not have the courage of his convictions to indicate to the Parliament whom he had in mind. That is typical of the honorable member for Yarra.

An interpretation that one is entitled to place upon the honorable member’s remarks is that he questioned whether members of the Parliament - undoubtedly those on this side of the House - had any right to consider international affairs. Apparently, he is the repository of all that is right and all that is proper and accurate in determining international affairs and in deciding what constitutes good sense and what constitutes arrant humbug. I must say that those of us who make some effort to examine these issues objectively come to conclusions slightly different from those of the honorable member for Yarra. For instance, he alleged on one occasion that I improperly understood the doctrines of Marxism and Leninism. Why did I misunderstand them, according to the honorable member for Yarra? The answer is to be found in the simple fact that I do not have the same affection for the doctrines of Marxism and Leninism as the honorable member for Yarra has, and so I have misunderstood them.

The honorable member turned to the matter of nuclear tests and the Geneva conference. To the best of my knowledge, no report has been released by the convocation of scientists on the matter of the detection of nuclear tests. There certainly have been some press reports, but where, may I ask the honorable gentleman, has he secured this information that there exists a report which discloses quite clearly and completely that the detection of nuclear tests is practicable? Some of us on this side of the chamber have, in the course of the last eighteen months or so, made a genuine and sincere endeavour to find out some facts concerning nuclear weapons and the nuclear age. We have been advised, Sir, by quite respectable authority, that the detection of nuclear tests is extremely difficult and complex. But not according to the honorable member for Yarra! It is a matter that can be settled, he has been informed. By whom has he been informed? Is it an unbecoming display of modesty that prevents him from disclosing who has informed him? What is the source of his information?

I rose this afternoon, Sir, to make a few fleeting references to the nonsensical arguments that were put forward this afternoon by the honorable member for Yarra. That was my prime purpose, but I can assure Opposition members that I do not propose to sit down without making a constructive contribution of my own by supporting the attitude towards the establishment of a diplomatic post in Formosa that has been voiced by the honorable member for Lilley (Mr. Wight) and the honorable and gallant member for Chisholm (Sir Wilfrid Kent Hughes). I believe, Mr. Temporary Chairman, that it is of the essence of urgency that Australia should command a listening post in Formosa to enable us to find out what is going on there, and also to indicate to the Chinese Nationalists that we are not unsympathetic to their cause. There are many people, including all Opposition members, who consider that red China should be recognized. That is a matter about which there can be legitimate differences of opinion, but I for one see nothing to be gained by recognizing red China at the present time. I believe that there would be immense and intense disadvantages in such a course, and I lend my voice in support of the attitude adopted by the two honorable gentlemen whom I have mentioned.

Mr CAIRNS:
Yarra

.- I am very pleased to have an opportunity to follow the honorable member for Moreton (Mr. Killen). It would not be necessary for me to deal with his remarks if the views that he has expressed were not influential among Government supporters. In the last ten minutes, the honorable member has exhibited the kind of spleen, hatred and disordered thinking that makes me apprehensive about what may happen in this country if people of this sort have the opportunity to translate into action the kind of thinking that they undoubtedly embrace. I suggest to other Government supporters, whose experience in discussion and debate is a little longer than that of the member for Moreton, such as the member for Warringah (Mr. Bland)-

The TEMPORARY CHAIRMAN:

Order! The honorable member will use the prefix “ honorable “ in referring to other honorable members.

Mr CAIRNS:

– I refer to the honorable member for Warringah as an example of an experienced person in this place. Do you, Sir, consider that speeches of the kind that you have just heard from the honorable member for Moreton are an appropriate answer to arguments such as I advanced earlier? I think that it would be a pretty sorry state of affairs in this Parliament if members who made submissions as I made them were met with the kind of answer that has been given by the member for Moreton.

The TEMPORARY CHAIRMAN:

–

Order! The term “honorable member” should be used.

Mr CAIRNS:

– The honorable member for Moreton. I think that I might now continue with the analysis of the situation that I was making earlier, so that those people who desire to consider that analysis will have an opportunity to do so. Therefore, I shall spend no more time discussing the attitude of the honorable member for Moreton, because I believe that such an attitude should be beneath the dignity of a member of the Parliament.

I was suggesting earlier, Mr. Temporary Chairman, that it is most important for the Department of External Affairs, and the Government, in the determination of its policy, to be informed by the most objective analysis of the facts that it is possible to get. I had examined the question of nuclear tests, not suggesting in any way that it was a simple scientific question, but suggesting that it was a complex one. I had suggested that, in 1957, a very strong body of scientific opinion - of which this Government appeared to be taking little or no notice - considered that an adequate system of policing tests could be introduced. I referred to reports of the discussions of the scientists at Geneva in newspapers such as the London “Times” which, I imagine, members like the honorable member for Moreton hardly ever consult. Those journals gave a full account of the results of the conference at Geneva, and, according to reports in newspapers such as the London “ Times “, there was unanimous agreement that an adequate system of policing tests could be introduced. Earlier, 1 referred to the Suez Canal dispute in a similar manner to illustrate that the decisions made by this Government in relation to that incident were founded upon an improper set of facts and an inaccurate evaluation of the facts that were before us. I suggested that the situation in relation to the Lebanon and Iraq was the same. Tn those countries, there is a problem which can be properly evaluated only if it is seen in terms of the internal economic and social problems and the external trading relations of those nations which are dependent upon exports of oil. The situation in which the West finds itself is that the United States of America and Great Britain-

Mr Snedden:

– On a point of order: I direct your attention, Mr. Temporary Chairman, to Order of the Day No. 14, under Government business on the noticepaper, which reads -

International Affairs - Ministerial Statement - Motion for Printing Paper - Resumption of debate (Mr. Opperman) upon the motion of Mr. Casey, That the Paper’ be printed.

Is not the honorable member for Yarra out of order because he is dealing with a matter that is on the notice-paper and is not properly within the scope of the Estimates now before the committee?

The TEMPORARY CHAIRMAN:

– My ruling is that in a debate of this kind, dealing with the Estimates for the Department of External Affairs, the honorable member for Yarra is in order.

Mr CAIRNS:

– Honorable members opposite have two reasons for taking the view that I am not in order. One is that they are considerably embarrassed by their inability to answer my arguments except by making personal attacks on me. The second is that they cannot see the relevance of the matters that I am discussing to the question of whether the Department of External Affairs is doing its work properly and of how it is doing its work. This is not a matter simply of personalities. It is not a matter for thinking in terms of personal criticism of officers of the department. Our job in this Parliament is to criticize constructively if we can the nature of departmental organization and the way in which it functions. We now have before us the estimates of expenditure for the operations of the Department of External Affairs for the current financial year, and the way in which the department is functioning is closely relevant to the consideration of those estimates. I am asking: To what extent is the department acquainted with the social and economic facts of the situation in the Middle Eastern countries? To what extent is it aware of the relationship of the external trade of the countries of the Middle East to their social and economic problems?

At this juncture, I should like to refer the committee to an extract from a recent publication, “ Red Mirage “, written by John 0’Kearney, who, at page 60, referring to Syria, which he has taken as an example, states -

This politico-economic evolution going on within Syria was better understood by James Madison when America was still revolutionary, than it is by Dulles. . . .

And I suggest that it was better understood by William Charles Wentworth the First than by William Charles Wentworth the Third or Fourth, for example. The author adds - “ A landed interest, a manufacturing interest, a mercantile interest, a moneyed interest, with many lesser interests,” said Madison, “grow up of necessity in civilized nations, and divide them into different classes, actuated by different sentiments and views.”

T think that William Charles Wentworth was perfectly well aware of that situation. The author then goes on to say -

But let there be a movement in Syria against feudalism and the figure of a George III., for land and tax reforms, for equal rights and federal union, and the Tory-minded Secretary of State reacts by throwing arms and millions in aid to kings of Jordan, Iraq and Saudi-Arabia. At the same time he frankly expressed the hope that pro-Western elements in Syria, who stand for everything to the contrary, might rise in force and take over.

What I am suggesting is that as far as one can judge from the “evidence submitted to this Parliament, in statements made by the Minister and by lesser lights on the Government side, the Australian Government is completely uninformed on those matters mentioned by the author of this book. It does not appreciate the significance of these transitions taking place in Middle Eastern countries with which the Western powers could constructively co-operate, and it does not face up to the more difficult and complex problem of working out a way of co-operating with these movements. It is not we on this side who over-simplify these problems; it is the Government and its supporters who do so. They oversimplify them according to the issue of communism and anti-communism, Nas.serism and anti-Nasserism, instead of tackling the much more difficult job of discovering what the facts are, and of attempting to work out a solution which is not in any way a simple one.

I do not admit the charge of attempting to over-simplify these problems. I do not admit to doing anything more than attempting to put a few constructive suggestions for the consideration of this committee. I do not pretend that anything I say will solve these problems. I do not pretend to know a solution in total. But I have been elected to this Parliament, as I understand it, with a responsibility to submit to the Parliament, as best I can, some practical suggestions for the solution of important and vital problems, and when my remarks are met with nothing but the cynical and distorted interpretation that has been given them by the honorable member for Moreton (Mr. Killen), then I feel that such honorable members are here for nothing but the political effect that their presence can create outside this House, and not to assist in any way inthe solution of these vital problems. I believe that those more serious members of the Parliament who have done me the honour of listening to what I have had to say will adopt an attitude vastly different from that of the honorable member for Moreton.

Sir WILFRID KENT HUGHES:
Chisholm

– I am rather surprised to hear the honorable member for Yarra (Mr. Cairns) accuse honorable members on this side of the House of lack of knowledge, of failure to put forward the facts on which their case is based, and of personal criticism, because the honorable member won his last election by plastering all over his electorate a picture of his opponent in the form of a rat.

Mr Cairns:

– Mr. Temporary Chairman, not often do I appeal to the Chair on the grounds of misrepresentation, but the honorable member for Chisholm has misrepresented me on this occasion.

The TEMPORARY CHAIRMAN:

–

Order! The honorable member will have an opportunity later to make a personal explanation.

Sir WILFRID KENT HUGHES:

– In case the honorable member’s susceptibilities have been hurt, I will say that his supporters plastered the pictures all over the electorate. But that is not the point at issue. I want to inform the honorable member that I believe every member of this Parliament is trying to do his best for Australia, irrespective of what his views are.

Mr Cairns:

– Let us accept that and leave it at that.

Sir WILFRID KENT HUGHES:

– I was reminding the honorable member for Yarra of how he started in the Federal Parliament, and I hope that he has changed his view. But I share with him the apprehension he expressed as to the future of this country. In fact, I feel that apprehension to a much greater extent than he does. I know that it is very difficult for the ordinary person in Australia, going about his every-day affairs, to become fully acquainted with all the details of what is happening, even in countries close at hand, much less in those in the Middle East area. We on this side of the Parliament may have many shortcomings with regard to foreign policy, but I can tell the honorable member for Yarra that if he has any real apprehension as to the future of this country, and fears that it may become a completely isolated island, as I have suggested before in this Parliament, in a new Red Sea, then within a very short space of time he had better have the policy of the Australian Labour party altered, instead of bothering to criticize the policy of the Government. If anything assists the rising red tide to encroach further and faster over the sands of democracy, it is the appeasement policy advocated by members of the Australian Labour party. What the Communists respect is strength, and what they exploit is weakness. I cannot see how, by giving comfort to our enemies and despair to our friends, as members of the Labour party do in their policy of appeasement to the Communists, we can hope to do anything but further undermine the position that exists to-day throughout South-East Asia.

The honorable member for Yarra joined in the general criticism of Mr. Dulles, the United States Secretary of State. I can only say to him and other honorable members that during my recent visit to the Far East the only places that showed any real strength and improvement, and any real crusading spirit in the fight against communism - and they had to meet it face to face in its worst form - were those nations in what might be termed the American sphere of influence, such as South Korea, Japan, Taiwan and South Viet Nam. I know that many people say that Chiang Kai-shek’s gang is corrupt, but those who make such allegations have not been in the area in question. In any case, we are not concerned with what may have happened in the past, but with what is happening to-day. If it were not for the part in our own defence which has been played by the people in Formosa - and the very large share of our defence expenditure which has been borne by them and by the R.O.K. army - the army of the Republic of Korea - we would be in a very much worse position than we are to-day.

I thoroughly agree with the honorable member for Lilley (Mr. Wight). I cannot understand why the only place of importance in the Far East in which Australia is not represented by a legation is Taipeh, the capital of Taiwan, which honorable members know as Formosa. It is not so long ago that the Labour party in England wanted to give away not only the off-shore islands in this area but also Formosa itself, and that policy was supported by many members of the Australian Labour party who are sitting in this chamber now. They did not mind whether they condemned a population as large as our own in Australia to slavery; they said, “ Give it away.”

Mr Bryant:

– We did not say anything of the kind.

Sir WILFRID KENT HUGHES:

– I am saying that many of the honorable member’s colleagues in the Labour party supported the policy of the Labour party in England, which at that time was, “ Give it away “. I am going back to a time before the honorable member for Yarra entered Parliament, and he has to consider the facts as they have emerged through recent history.

There are many other things that I cannot understand. When I was in Singapore, I could not decide whether I was crazy or an undercover Communist, upon finding that the red banks of China are allowed by us to operate freely without let or hindrance. I do not know why we spend millions of pounds on the emergency operations in driving Communists out through the front door, when, through the red banks of China, the head-quarters for blackmail, infiltration, subversion, and the financing of phoney peace fronts, we leave the back door and the side door wide open.

There are many ways in which, I believe, Australia can do a lot more than she is doing at present to help the democratic peoples in South-East Asia. Malaya has just gained its independence, at a time when the prices of her main products on which she depends, mainly tin and rubber, have fallen to rock bottom. Forty-six per cent, of its civil servants, the old Malay civil servants, are moving out within the next twelve months. I do not blame them for going. They cannot afford not to go, in view of the pensions and the financial provisions which are made for them. But on the other hand, I think we might do a lot more to assist that country which has, in the next three or five years, to recruit practically 50 per cent, of its civil service.

One can go to South Viet Nam and have a look at the courageous struggle for existence that is going on there. We pride ourselves on our soldier settlements, and rightly so, but in South Viet Nam, in the high plateau areas, you will find, in what was virgin jungle a year ago, a complete community of 2,500 people with one hectare of vegetable land for each family, and another four hectares cleared, so that each household will have five hectares of land to till. That was only one resettlement area which I myself saw.

I want also to join with the honorable member for Lilley in his criticism of the attitude of the Treasury towards our representatives in those countries. It is not easy for seven Australians to work, in the tropics, in a room 10 feet by 15 feet, or very little larger, inside a residency. I know that that position has been altered, but it never should have existed. I was told when I came back and complained about it that this legation was one of the worst examples of the accommodation we had overseas.

Mr Haworth:

– Where was it?

Sir WILFRID KENT HUGHES:

– In

Saigon. I understand that they now have decent quarters in an air-conditioned building. With the honorable member for Wentworth and the honorable member for Lilley, I feel that not only officers of the Department of the Treasury but also members of this Parliament should take a bit more interest in our own Australian representatives who are working in the outposts of this nation. It is sometimes said, “ Oh, well, they go out to this, that or the other party or entertainment “. A certain amount of social activities are associated with these posts. I know that that is so, but on the other hand long service in the tropics is not easy from a health point of view, and I feel that a great deal more could be done by having a sort of peregrinating medical officer who would see that our officers and their families are submitted to a proper and thorough examination every six months, and that if any one is suffering from amoebic dysentery, malaria, or anything of that nature which those of us who have been there for some time know all too much about, he or she should be flown out, as the Americans fly out their civil servants, until he is completely cured. He should then have a holiday before going back. In that direction a lot of things can be done.

I am afraid that those members of the Australian Labour party who do not believe that, as the Communists have told us, co-existence is the Communist method of conquest without war, and who think that by holding out the hand of appeasement they are going to help either the democratic peoples of South-East Asia, or the future of Australia, are in for a very big surprise in a very short space of time. I have said before in this chamber, and I say again, that I believe that at the present time this country is in the greatest danger that it has ever faced in the whole of its history. We have to make up our minds that this method of dealing with crises on an hour-to-hour, a day-to-day, or a monthtomonth basis, is not of much use. We have to try to look further into the future and have long-term policies to meet eventualities, which I hope will not arise, but which may.

The destiny of Australia is bound up very largely with the destiny of South-East Asia. I think it will be found that the history of the world for the next 50 years will be determined by what happens in South-East Asia, Southern Asia, and the Western Pacific. It is an exciting and challenging era and region in which to live. It is no good thinking that we can go on as we did before World War II., leaving it to other people to take responsibilities which now rightly rest on our own shoulders. If the honorable member for Yarra and those who think as he does are apprehensive about the future of this country, they had better very rapidly change their policy of appeasement towards the Communists.

Mr Cairns:

– It is your policy that is failing.

Sir WILFRID KENT HUGHES:

-day, I think that most critics will agree that the Communists went through, first, a period of force and fraud, which won them the European satellite*;, North Korea, mainland China, and North Viet Nam. They then thought that it was getting a bit dangerous, and they switched to the ideological phase, and they were winning people like the honorable member for Yarra and others, until the revolution happened in Hungary. Since then they have turned to the third phase of world conquest, the most difficult and dangerous one of them all, in which, as I said, aid and trade is the weapon of annihilation.

It is not easy. It has a lot of ramifications, and I have not the time to go into it here. I want merely to point out those three salient points and to tell the honorable member for Yarra that if he likes to hand it out the way he has done in the past, he has to learn to take it.

Mr Cairns:

– Mr. Chairman-

Motion (by Mr. Harold Holt) proposed -

That the question be now put.

The CHAIRMAN:

– The question is: “ That the question be now put “.

Mr Cairns:

– I want to raise a question

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– Do you want to make a personal explanation?

Mr Cairns:

– Yes.

The CHAIRMAN:

– If members rise to make personal explanations, let them state the purpose of their rising. How can the Chairman know what is in their minds? The question before the Chair is: “ That the question be now put “.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– With the consent of the committee, I withdraw that motion, as I understand that the honorable member for Yarra wishes to make a personal explanation.

The CHAIRMAN:

– Let me explain to the committee that if members want to make a personal explanation, they should rise and say, “ Personal explanation “. Then the Chair will know what is in their minds and that they are not rising in order to make a speech. I call the honorable member for Yarra - on a personal explanation.

Mr. Cairns. - I merely wanted to sav that what the honorable member for Chisholm (Sir Wilfrid Kent Hughes) had said misrepresented the position. I had nothing to do with depicting any one as a rat. I just want that put on the record, because otherwise, the allegation would be used again in a similar fashion.

Mr BRYANT:
Wills

.- Mr. Chairman-

Motion (by Mr. Harold Holt) put -

That the question be now put.

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

AYES: 57

NOES: 33

Majority . . . . 24

AYES

NOES

Question so resolved in the affirmative.

Proposed vote agreed to.

Sitting suspended from 5.51 to 8 p.m.

Department of the Treasury.

Proposed Vote, £10,516,000.

Mr CREAN:
Melbourne Ports

.- In opening the debate for the Opposition on the proposed vote for the Department of the Treasury I should like to ask the Government a few questions about a matter that is of great importance to the people of Australia - the public debt of this country and the closely allied subject of loan raisings either from members of the public direct, as individuals, or indirectly through companies or financial institutions.

It is rather difficult at times, in dealing with these matters, to distinguish what might be regarded as the official viewpoint of the Treasury - if there is such a viewpoint - from the policy of the Government. In each of the last three Budget speeches the Treasurer (Sir Arthur Fadden) has followed a certain course. At this point of my speech I pause to say that whilst I congratulate the right honorable gentleman on his long term of office I am thankful that he has brought down his last Budget and that there will now be an opportunity for some other point of view about the nation’s economy to be presented during the next few years in Australia. In each of the last three years the right honorable gentleman has pointed in the Budget speech to what he regards as a difficult problem in the Australian economy. That problem is what he calls the “ problem of debt conversion in Australia “. The fact that he pointed to it in the Budget speech in each of the last three years indicates that it is not merely a passing problem. In fact, it is a problem perpetuated because of the financial methods that are being pursued by the Government. That very informative document, the “Treasury Information Bulletin “, in No. 11 of July, 1958, at page 10, under the heading “ Commonwealth Loans “, contains the following interesting statement: -

Debt maturing in Australia in 1957-58 amounted to £399,200,000 . . . and £344,400,000 of this was converted - £228,700,000 into short-term securities-

I ask members of the committee to note that last conversion into short-term securities - £46,500,000 into medium term securities and £69,200,000 into long-term securities.

In other words, there is a distinction in the document between three kinds of public debt - short-term securities, medium-term securities and long-term securities. And, of course, there is a type of security which might be embraced under the heading “ short-term security “, but is not specifically mentioned as such. I refer to treasurybills. But at least most of the conversions this year - and this was also the case in the two previous years - have been for terms of either one year or two years. Therefore, what is a conversion problem in 1958 becomes, insofar as it is dealt with in a short-term form, also a problem of conversion in 1959 and 1960.

It is rather difficult to find out whether consciously and deliberately, or otherwise, the Government is endeavouring to convert the public debt in Australia to a short-term basis rather than a long-term basis. In some other countries, of which the United States of America is a good example, the tendency is to have the public debt held in short-term form rather than long-term form. There are many advantages in this kind of finance; but there are not many advantages in it if the short-term rate becomes very close to the long-term rate of interest.

If honorable members will examine the financing of the recent short-term loan market in Australia they will find that there is very little difference, so far as interest yield is concerned, between buying Government securities with a currency of two years and those with a currency of ten or fifteen years, because the effective rate of interest for the short-term security approximates 5 per cent., whilst the interest rate for the long-term security is very little higher than that. After all, if only on the grounds of caution, because of the almost catastrophic capital losses that have been sustained in relation to the Government debt over the past five or ten years, the shortterm securities could be preferred by many people. Such capital losses have been sustained even by the Government itself, because, if the transactions of that rather odd fund known as the “ Loan Consolidation and Investment Reserve “ are examined, it will be seen that during the last three years that the fund has been in existence the. Government itself has suffered capital losses of the order of several million pounds through selling Government securities at under their face value. Because of the existence of such circumstances it is not surprising that the majority of subscriptions to public loans to-day are flowing to the short-term end of the market rather than the long-term end.

There are several aspects to this question of the public debt which are, I think, worthy of serious examination by the committee. One concerns how much of the interest transactions connected with the public debt are merely a transfer, as it were, from the right-hand pocket of government activity to the left-hand pocket of government activity; because if an examination is made of the vast amount of public debt in Australia - I think it is approaching the astronomical figure of £4,000,000,000 in total - it is surprising how much of this is not held directly or individually, but is held by government agencies of one kind or another, such as trust funds, the reserve for the note issue, and so on. In fact, if you calculate the total interest component of the debt you find that a large proportion of this is collected as interest and then simply paid over to those various trust funds which hold it. The result is that annually the financial picture of government in Australia is getting more and more difficult to follow because there is not a frank enough exposure of where this Government is going in relation to the public debt.

I was not here when the Budget was being debated, but I read the Budget Speech of the Treasurer. It is surprising to find how much attention was given in that speech to the public debt and its conversion, or the anticipated failure to convert it in the next twelve months, by those very few people who will continue to hold, privately, the public debt in Australia. After all, it is the aggregate position that is the most significant and, in the aggregate, deficit financing this year is primarily due to the fact that the Treasurer expects that about £80,000,000 of debt which is held privately will not be converted. I suggest that “ privately “ is a fairly broad term in all the circumstances. The Treasurer expects that when the loans mature people will prefer to have the cash which they will reinvest or put into their bank accounts and leave to the banks to invest for them. Primarily, whatever juggling goes on in relation to the £78,000,000 of defence expenditure which is being undertaken by treasury-bills, the reason for deficit finance in Australia to-day is the failure of the loan market at the level of individual investment.

I read, when coming here the other day on a plane from San Francisco, the fantastic financial result of the operations of the Broken Hill Proprietary Company Limited in Australia during the last twelve months. One of the significant things about the published statement of that company was that whereas at the end of June, 1957, this concern had about £1,000,000 invested in government securities of the Commonwealth of Australia, at the end of June, 1958, it had £12,000,000 invested in such securities. If I may hazard a guess, I would suggest that most of that increment of £11,000~000 in the period of twelve months went into short-term government securities issued by the Government in that twelve months. That is part of the great conversion problem that the Treasurer faces during the current financial year. For a short-term investment in gilt-edged securities, the Broken Hill Proprietary Company Limited can get almost 5 per cent, interest, or nearly £600,000, at the expense of the rest of the Australian community.

In my view, there is no reason why shortterm government loans ought to bear interest at much more than 2 per cent. But, because of the failure of this Government to pursue a sound financial policy, the interest rate has been pushed up almost to 5 per cent. Another question which I think is worthy of examination and of a much more adequate explanation by the Treasurer is why, on 18th February, 1958, a conversion at 6 per cent, took place in London of a loan of £16,000,000 sterling or £20,000,000 Australian, which was formerly held at 3 per cent. Details are contained at page 118 of the Budget Papers for 1958-59.

In other words, the annual increase in interest payable by Australia on that debt is £600,000. Why, at a time when Australia’s overseas reserves are of the order of £500,000,000 is it considered prudent finance to convert a loan formerly held at 3 per cent, into one at 6 per cent.? In my view, it would have been sounder financial policy to have redeemed that loan and so to have avoided an annual interest payment of £1,200,000. It would have been shrewder and sounder finance to have done that. This is a matter on which more deliberate and conscious information should be given.

Mr CHAIRMAN:
Mr. Adermann

Order! The honorable member’s time has expired.

Mr HULME:
Petrie

.- In the few minutes which are available to me this evening I should like to deal with a matter about which the Government has been consistently criticized by the Opposition over a very long period. I refer to hire purchase. This is the only opportunity that the Estimates give for a debate on this matter, and I want to make a few comments in relation to it. First of all, I should like to suggest that the impression which the Opposition has given to the community is that the Commonwealth Government has a responsibility in relation to hire purchase, and that it has power to deal with the problems which arise in relation to it. I feel, therefore, that one should endeavour to put the record straight.

It may be that, in war-time, this Parliament does have authority to deal with hire purchase, whether in relation to rates of interest paid on money which the companies borrow or, perhaps, in relation to the interest which the companies charge. But. by and large, we must consider our situation in peace-time. At the moment, I believe that the legal opinion in relation to hire purchase is that the only power which the Commonwealth has to control interest is the banking power and that hire-purchase business, as it is conducted at the present time, cannot be regarded as coming within the terms of banking business.

Mr Edmonds:

– Why does not the Government use the Commonwealth Bank?

Mr HULME:

– The Commonwealth Bank’s responsibility relates to the rates of interest banks can charge on overdraft and the rates of interest which banks can pay. But beyond that, the Commonwealth Bank, through the central bank, has no power to control interest rates.

Therefore, obviously, if the Commonwealth Bank has not the power it is a State responsibility. Notwithstanding the comments of the Opposition, I think it can be quite clearly shown that the States themselves acknowledge that they have a responsibility and that they have power of control in relation to hire purchase. I think that in every State there is some legislation dealing with hire purchase. There is legislation dealing with minimum deposits, with the repossession of goods and, in some States, with the period for which goods repossessed must be held before they can be resold.

In New South Wales, the Labour government went even further than that. In September, 1957, it fixed the maximum rates of interest which could be charged in New South Wales under hire-purchase contracts. On farm equipment and new motor vehicles it fixed a maximum interest rate of 7 per cent.; on second-hand motor vehicles it fixed a maximum rate of 9 per cent., and on all other items it fixed a maximum rate of 10 per cent. That should be clear evidence to the Opposition and to the community at large that the States know that this is their responsibility. If we required any further evidence in relation to it perhaps one could say that if the hire-purchase companies believed that the State governments had no authority to legislate in relation to hire purchase, obviously they would have tested the legality of the legislation in the courts of Australia.

So I think that we should accept for all time that, at the present moment, the Commonwealth Government has no responsibility and no power to deal with the questions either of interest paid by the companies or the interest charged by the companies. Of course, the Commonwealth has realized the position and has asked for a conference of the States, but that request has been rejected. The Queensland Government, which is now a Country-Liberal party government, has realized the problem that exists in this connexion. The Labour government which held office in that State for over twenty years did nothing about it. but the present Government has decided to appoint a special investigator to inquire into matters relating to hire purchase and particularly the interest which is paid by the companies on moneys which they borrow. When that information is available, the Queensland Government intends to call or ask for a conference of all State governments, and I believe that already there has been a clear indication that other State governments are prepared to come and discuss the matter.

The first of the two principal points, apart from whether we have power or not. which the Labour party raises in relation to this, is the high interest rate earned by the companies and the high interest rate which they pay in relation to the money which they borrow. The second one is the criticism that the trading banks have entered the hirepurchase field. I should like to say one or two things about these aspects.

In the first place, in relation to the high earning capacity, there are two factors. The first is the rate of interest which was referred to by a special board of inquiry appointed by the Treasurer of the day, Sir

Arthur Fadden, in 1941. Included in the four names of the members of the board which investigated this matter is that of, I suppose, the greatest financial genius the Labour party has ever produced, the late J. B. Chifley. He signed the report of that Board of Inquiry appointed to inquire into Hire Purchase and Cash Order Systems in 1941. Consequently, we may conclude that this report represents Mr. Chifley’s view as well as that of the other members of the board. At paragraph 133 we read -

The finance charges as set out in paragraph 77 are not unreasonable and there appears to be sufficient free competition among the finance companies to act as a brake on excessive charges. There was some evidence of occasional higher charges.

If we turn to paragraph 77, we discover that the interest charges at this particular time varied between 5.6 per cent, and 10 per cent. Those were the rates which Mr. Chifley agreed were reasonable in relation to hire purchase. Of course, some people will say that they are flat rates. I appreciate that; and the board of inquiry dealt with that aspect. In paragraph 135 of the report we read -

To meet this-

That is, this situation of the per annum interest rate as against flat rate - it could be laid down that the added charges expressed as a true rate of interest per annum on the unpaid balance shall not exceed rates as may be specified. Suggested rates for this purpose would be -

Furniture and wireless sets - 20 per cent.

Motor vehicles, used - 16 per cent.

Other goods, wares and merchandise - 15 per cent.

This shows that Mr. Chifley and his fellow members of that board of inquiry had no objection to interest rates which varied, on a per annum basis, between 15 per cent, and 20 per cent. If we look at the situation to-day we find that the legislation introduced by the New South Wales Government follows very closely these interest percentages which were being charged in 1941. I feel that under these circumstances there is little or no justification for the criticisms which emanate from the Labour party in relation to this particular matter.

I should like to examine another aspect of this high earning capacity, that is, the basis of operation of these particular companies. I want to give the committee as simple an illustration as possible, dealing with approximations because that is the easiest way in which it can be made useful to honorable members. If we accept that, before paying income tax on the funds which it uses for hire purchase, a company makes 12 per cent., we expect that company income tax takes approximately one-third, which leaves 8 per cent, in the shareholders’ hands, where the amount is only the actual paid-up capital. But if, in addition to the paid-up capital there is an equal amount of borrowed money on which there is a payment of 6 per cent, interest, the 12 per cent, is reduced to 6 per cent, after the actual deduction of the interest paid. The income tax on the balance of 6 per cent, represents one-third, which is 2 per cent., leaving an additional 4 per cent, in the hands of the shareholders. Of course, if the amount of borrowed money is double the paid-up capital, obviously the additional amount for shareholders is another 4 per cent., and so it continues, and in respect of the doubleborrowed money in relation to paid-up capital, on this illustration, the amount available to shareholders is 16 per cent.

A few days ago, honorable members received a memorandum from a prominent underwriting firm in Melbourne giving particulars in relation to many of these companies. The amount of borrowed money which some of them had was as much as five, six, and even up to eight times the paid-up capital. Even on the basis of six or eight times, it can be easily seen that a company can make a profit of something in the vicinity of 40 per cent, in relation to the actual paid-up capital.

I suggest that this form of finance is used not only by hire-purchase companies, but also by many companies in Australia at the present time because of the income tax charge in relation to profits on companies. This avoids the necessity of providing income tax before the payment of dividends as would be necessary on share capital.

I now want to say something about the entry of banks into the hire-purchase field1. Hire purchase is an established element in our present-day community life. Contrary to the impression which has been given by many members of the Opposition over a fairly long period, the funds which banks invest in hire purchase are shareholders’ funds. They are not the funds which are represented by deposits in the banks made by various people in the community. In most cases, I suggest, every time an Australian trading bank has entered into hirepurchase business, it has made a new issue of shares sufficient to provide the capital to invest in a hire-purchase company.

I believe that the conservatism of banks is a guarantee to the community, whether it is in relation to a person who is a hirer of goods or the investor of money in share funds, or in relation to money at call or on deposit. I believe that the type of activity which banks normally undertake provides a guarantee to the people that the business will be conducted on a very sound basis. We all know that hire-purchase money is dear money. We know also that goods purchased under hire purchase are dear goods. But we must not overlook the fact, in relation to this question of hire purchase, that there is provided through it the opportunity for so many people in the community to obtain semi-durable goods to build up for themselves assets which, under other circumstances, if they had to depend upon a * overdraft, they would not be able to do.

The people want hire purchase, and ever though it involves paying the rates of interest which apply at the present time, I believe that there would be a terrific reaction from the community at large if anything was done to take away the opportunity of having money available to them for the purchase of these goods which they so desire and which are so essential as amenities.

Mr COSTA:
Banks

.- The honorable member for Petrie (Mr. Hulme) seems to be the chief apologist for the Government’s failure to do the right thing by the people of Australia. In 1955, the Treasurer (Sir Arthur Fadden) was very, concerned about hire purchase. I should like to know why he is not so concerned about it now. I refer the honorable member for Petrie to what the Treasurer said in his Budget Speech in 1955, when he was very concerned about this matter. On that occasion the right honorable gentleman said -

I have spoken of the prevailing tendency to try to achieve living standards beyond our current resources. This tendency has found expression in the rapid building up of a structure of timepayment or hire-purchase credit. The Government has been greatly concerned at this development and its effects upon the economy. The matter was discussed with the State Premiers at the last

Loan. Council meeting and a joint statement was issued calling attention to the adverse effects which the high rates of interest-

Fancy this Government being concerned about that! - being paid by hire-purchase companies were having on the raising of funds for vital developmental works. The banking system has subsequently been asked to curtail finance for hirepurchase business and the Government has been considering ways of dealing with the position within the limits of its own constitutional powers. In part, no doubt, the problem is one for the community itself to determine and I earnestly suggest that members of the public should ask themselves how far they should support a system which not only involves them in mortgaging their own future but carries a threat to the economic stability in which they have so great a stake.

Mr Cope:

– Who said that?

Mr COSTA:

– The Treasurer said that in 1955. That was a remarkable statement for him to make, because since then he has not opened his mouth on this topic. Since he made that statement almost all the private banks in the country have become large shareholders in hire-purchase businesses. I challenge the Government to take action to fulfil its pledge about hire purchase, about which it was so gravely concerned in 1955. It is apparent that when the Treasurer made the statement to which I have just referred the banks and the investment companies must have said, “ Lay off that matter. It is a good cop for us. Do not enter into it”.

Mr Peters:

– The honorable member for Petrie also says, “ Lay off “.

Mr COSTA:

– Of course he does. The activities of hire-purchase companies are being condoned by this Government.

I have here a clipping from a newspaper. Every week one can see advertisements in the newspapers in which semi-government bodies ask people to invest in their loans at 5i per cent, in order that they might carry on urgent developmental works.

Mr Stokes:

– They are good security.

Mr COSTA:

– Yes, but could you get people to invest in that type of security when they can get a return of 10 per cent, from hire-purchase companies? This newspaper advertisement reads -

Sydney Guarantee Corporation pays you ten per cent. … By making a compound interest deposit, your interest is added to your original deposit to earn further interest.

This Government allows that to go on. If (A), the money lender, puts money into (B), the investment company or the banks, to pass on to (C), the purchaser, to buy goods, how much interest must the purchaser pay? There is no escaping the truth of what honorable members on this side of the committee have been pointing out to the Government for some time. The minimum interest rate paid for money borrowed under the flat rate system is 19i per cent. As I have stated on other occasions, as the instalment payments come back to the hirepurchase company the money is immediately let out again, and the rate of interest that these hire-purchase companies and the banks are earning is indeterminable. It could be 50 per cent, or 60 per cent.

Mr Haylen:

– Shylock was an amateur compared with these people.

Mr COSTA:

– Shylock was a gentleman compared with the people whose activities this Government is doing nothing to curb.

I wish to speak about something else that is very big - I like talking about big things. One of the biggest things in this country at the moment is the national debt, and this Government is doing nothing about it. There is no comment in the Budget Speech about this very important matter, and any information about it in the Budget is very flimsy. Sufficient information is never given in second-reading speeches, and, after all, as the examiners of this annual stocktaking that takes place we are entitled to the fullest information. If all the relevant documents are not put before us it is difficult to do the job we are expected to do. The national debt has grown very considerably since this Government came to power. In 1950, it stood at £2,909,400,000, and in 1957, according to the latest figures available to me, it was £3,991,400,000. That means that the Government has allowed the national debt to increase by about one-third since it has been in office. Consider the huge interest bill we have to pay on our national debt. The staggering amount is not surprising, because this Government supports a policy of high interest for people who have plenty of money. The interest charge on our national debt in 1950 was £75,400,000. In 1957 it was £136,600,000. I have been able to obtain the latest figures from the Treasury, which show that in 1958 the interest bill amounted to £147,700,000. So since this Government has been in office the national debt has been increasing at the rate of about £100,000,000 a year, and the interest on the national debt has been increasing at the rate of about £10,000,000 a year. The Government does not mention this important matter in the Budget, just as it does not mention the very important matter of hire purchase.

To meet the national debt we have a National Debt Sinking Fund, which has been operating since 1923. The National Debt Sinking Fund Act was passed for the purpose of liquidating and preventing national debt. There must be something wrong with the act, because the national debt is increasing very swiftly. I have made some investigations into this matter, and find that the average amount going into the fund each year is about £40,000,000. Money is being paid in at that rate, but despite that the debt is increasing at an alarming rate. I should like to know what ceiling the Government thinks can be placed on this debt, and who will eventually pay it. There is something wrong somewhere. More than £906,000,000 has been paid into the National Debt Sinking Fund since its inception in 1923. A little more than £402,000,000 has been used for redemption of federal debt, and about £259,000,000 has been paid off the State debt, leaving a balance of about £243,000,000. Honorable members will see that notwithstanding the fact that the fund is over 30 years old, it is not making any impact on our colossal national debt. That is a very serious matter, sufficiently serious, I think, for the Government to make some provision for it in the Budget.

Another matter relating to the national debt is its effect on railway systems in Australia, Again, this is something about which the Government is doing nothing. I do not think that, within the framework of the national debt, any item is increasing as rapidly as is the railway debt. In 1956, the total indebtedness of the railway systems throughout Australia was £596,000,000, and to-day it is about £656,000,000. In that period of two years, the debt increased by £60,000,000. The debt for the various States is as follows: -

The total for all the States is £656,709,000. I know that Government supporters from time to time blame the New South Wales Government for the indebtedness of the railways of that State because it happens to be a Labour government. But an examination of the facts will show that some States are in a worse position than New South Wales. The railways must pay interest on the indebtedness, and the interest is paid out of the working expenses. In New South Wales, the revenue of the railways for 1956-57 was £78,000,000. Out of this amount, the Commissioner paid interest of £9,500,000 on the indebtedness. In Victoria, revenue was £37,000,000.

Mr Curtin:

– What government is there?

Mr COSTA:

– A Liberal government.

Mr Cope:

– Did it increase fares?

Mr COSTA:

– Fares in Victoria have just been increased because of this indebtedness and because the Commonwealth Government allows the indebtedness to continue. Victoria paid interest of £3,000,000 out of revenue of £37,000,000. In Queensland, the revenue was £36,000,000, out of which £2,900,000 was paid in interest. South Australia paid £1,600,000 in interest out of revenue of £13,000,000.

Mr Makin:

– What kind of government is in that State?

Mr COSTA:

– South Australia has the same brand of Government as we have here. New South Wales devoted 12.1 per cent, of the revenue to the payment of interest on the original indebtedness of the railways. In South Australia, the percentage was 1 1 .8, which was almost as bad as the New South Wales figure. The position was worse in Western Australia. There, 14.8 per cent, of revenue was used to pay interest on the debt. In Tasmania, it was 13.9 per cent. Each year the States must find £19,600,000 to pay interest on the indebtedness of the railways, and the revenue position is worsening. The people of Australia are paying £19,600,000 to these systems that are losing money and- will continue to lose money. 1 believe that the Commonwealth Government, which is responsible for national finance, should take some action in relation to this very serious matter.

T asked the Treasurer to-day whether he could tell me how much of the railway debt was the original debt, and he told me that he could not give me that information. We should have that information so that the matter can be discussed properly at this time when we are considering the annual stocktaking. 1 wanted to know, also, whether any of the money was funded at any time. Under the Constitution, the Commonwealth can fund some of the debt, and I believe that it should, because that is the only way to prevent it increasing. The States, whether they have Liberal governments or Labour governments, would then be relieved of this tremendous burden which is wrecking our railway systems, lt is typical of this Government that it should ignore the problem and not even mention it in the Budget Speech. In 1955, the Government professed to be alarmed about hire purchase, and was going to do all sorts of things, but it has failed to do anything.

The CHAIRMAN:

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

Mr ANDERSON:
Hume

.- I knew that the question of hire purchase would be introduced into this debate, because it is one of the points that the Australian Labour party intends to use during the election campaign. In the recent Victorian elections, the Labour party accused the Bolte Government of failing to take action on hire purchase and said that if Labour was returned to office it would deal with hire purchase. In that way, the Labour party recognized that this is a State matter. The people in this chamber most vocal about hire-purchase interest rates are Labour members from New South Wales. Their own Government in New South Wales has legislated on this question. Yet they come into the National Parliament and use this humbug every time they open their mouths! They do so because hire purchase is their election point. Why is it their election point? Because they know that large numbers of citizens are using hire purchase and would like a lower rate of interest. Hire purchase, therefore, becomes a good talking point.

Only three years ago, the Prime Minister (Mr. Menzies) and the Treasurer (Sir Arthur Fadden) at a meeting of the Australian Loan Council asked the Premiers to act on hire purchase. The honorable member for Banks (Mr. Costa) mentioned that. He said that the Treasurer was disturbed about the high interest rates and the movement of money towards the hirepurchase system. As he said, the Commonwealth has no constitutional power to deal with this matter. At a meeting of the Australian Loan Council, the Premiers were asked to refer the necessary power to the Commonwealth, if they would not take action. If the States agreed to do that, there would be no constitutional question. But did the Premiers do it? No. Not one Premier offered to refer the power to the Commonwealth, although at that time four of the States had Labour governments.

So we have this humbug, and the time of the National Parliament is taken up with an argument that the Commonwealth can act on hire-purchase interest rates. A plank of the Labour party’s platform for the next election is a reduction of these charges. It appeals to the amoral instincts of man. The Labour party cannot find anything but hire purchase to talk about during the election campaign. The honorable member for Banks said that the Commonwealth was responsible for the indebtedness of the railways. However, the New South Wales Government has spent countless millions of pounds on the electrification of the western line. That money could have been spent in the rural areas on development such as water conservation. Unfortunately, the Commonwealth is held responsible for everything done by the State governments. What sort of people are the honorable members who constitute Her Majesty’s Opposition? They always talk humbug!

I wish to deal with estate duties. This is a matter of considerable importance. The Commonwealth assesses duty on many kinds of estates. I should like the present Treasurer and the gentleman from the Government side of the chamber who will succeed him in the new Parliament to consider a change in the method of assessing estate duty on certain classes of property, with particular reference to the value of certain kinds of businesses and machinery. In the United Kingdom, there is a special rate of estate duty on agricultural property. In the assessment of duties there, in general, a principal value of assets is assessed at the date of death. The principal value is the equivalent of the market value. But there are exceptions to this rule in the assessment of duty on agricultural property, business premises, and plant and machinery. It appears that two values are ascertained for duty purposes in respect of agricultural properties. One is the principal value, which, as I have said, is the equivalent of the market value, and the other is the agricultural value which it seems is the value that the land would have if it were subject to a perpetual covenant prohibiting its use for other than agricultural purposes. In the United Kingdom, a principal value is established; and then the agricultural value is assessed, and that is subject to a small rebate. It does not make a great deal of difference in the final result, but it does make a difference in materially relieving agricultural property and certain classes of businesses of the burden of estate duty.

This matter has cropped up recently in New South Wales, where unimproved land values have been increased. The increase has caused considerable concern in agricultural communities, because it is not easy to realize on land in order to pay estate duties. I know of quite a number of cases in which grave hardship has been caused as a result of value increases by the current method of assessing estate duty. I should like the Treasury to examine the matter in order to ascertain whether methods of assessing estate duty similar to those employed in the United Kingdom could be adopted in Australia. This is an important question in a country in which much of the national production and a great deal of the national wealth come from the land. Any improvement in the method of assessing estate duty on land will promote increased investment in land, and that in itself will add to our national assets and increase our primary production.

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– The opening remarks of the honorable member for Hume (Mr. Anderson) were in keeping with his role as one of the most tory of the tory members in this chamber. The one thing that he seems to lose sight of most readily is the simple fact that so long as the National Parliament allows hire purchase to go on as it has done for so long, we can expect Treasurers to budget for deficits of £110,000,000 or perhaps £200,000,000 because the people have not sufficient money available to fill government loans at a re spectable and decent rate of interest. Nobody should know that better than the honorable member for Hume. The people who will suffer most from this situation in the long run are the farmers. The honorable member will find that he has something to answer to his constituents for on 22nd November, because the Bank of New South Wales and the other private trading banks are now telling farmers who seek financial accommodation for the purchase of new machinery that if they walk down to the hire-purchase counter they can have as much money as they like - at hirepurchase interest rates. On 22nd November, the honorable member will pay for the toll that is now being taken of the farmers in the Hume electorate by this resort to hire-purchase financing.

Perhaps we are at a disadvantage in a debate of this kind in facing a Government that is about to lose the services of a Treasurer who has served in that office for a long time. So far during the consideration of the Estimates, we have been favoured with the attendance in the chamber of the Ministers responsible for the departments for which proposed votes were before the committee, and even the Prime Minister (Mr. Menzies) attended when the proposed vote for the Prime Minister’s Department was under consideration. I assume that the Minister for Health (Dr. Donald Cameron), who is now at the table, represents to-night the gentleman who will be the next Treasurer. I certainly cannot imagine that the Minister will be the new Treasurer. I hope that the Treasurer-to-be will take notice of what is said in this debate, because, next year, he will face exactly the same situation as the present one. He will have to tell the people of Australia, next year, that, because of the lack of public support for government loans, the taxpayers can go on paying high taxation from year to year and that the Government will still have to meet its commitments by resorting to treasurybills. But there is a limit to any nation’s capacity to live under such conditions.

We have heard the position in New South Wales compared with the position in Victoria. The Australian Labour party, to which I have the honour to belong, campaigned in Victoria in opposition to the present hire-purchase set-up. If Government supporters can derive any satisfaction from the knowledge that only 37 per cent, of the people of Victoria endorsed the Bolte Government’s policy, they are welcome to that satisfaction, but I warn them that they will get no satisfaction from the poll on 22nd November next, because the tables will be turned.

I wish to raise another matter, Mr. Chairman, and I wish the new Treasurer, whoever he will be, were in attendance to hear what I have to say about it. One thing that we cannot tolerate at a time when the Government is budgeting for a deficit is favoured treatment handed out to any one State. I emphasize that. The consideration of the proposed vote for the Treasury provides me with the only opportunity that I shall have to raise this matter. It so happened that, after the Budget had been debated last year, the Commonwealth Railways Commissioner presented his report on the operations of the Commonwealth railways in the financial year 1956-57, which disclosed a situation that could not be tolerated even in good times by any one who disagreed with the favoured treatment of a particular State. At page 7 of that report, the Commissioner dealt with an arrangement between this Government and the Playford Government in South Australia which accorded substantial favoured treatment to that State in 1956-57. That favoured treatment is to be continued in the current financial year, and it will be continued again in 1959-60 unless something is done about it. This treatment is being extended to South Australia in a way that should not be tolerated, especially at a time when the Government is budgeting for a deficit in Commonwealth finances.

The CHAIRMAN:

– Order! The honorable member could more appropriately discuss this matter when the proposed votes for the business undertakings, including the Commonwealth Railways and the PostmasterGeneral’s Department, are before the committee later.

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– May I crave the indulgence of the committee to read a short extract from the report. It will, perhaps, give the Chair another slant on what I am saying. At page 8, the report of the Commonwealth Railways Commissioner for the year 1956-57 states -

All revenue earned by this Department is paid into Treasury accounts, and we are placed in funds by the Treasury to cover operating expenditure and also new works. Consequently, payment of the subsidy as provided for by section 44 merely means a book entry in Treasury records, and the provision of additional funds is not involved.

Therefore, it is a Treasury matter, Mr. Chairman, and I submit, with due deference, that it is more appropriate perhaps to deal with it than with hire purchase during the consideration of the Treasury estimates.

The CHAIRMAN:

– The proposed votes for the business undertakings will be discussed separately later, as the honorable member is well aware, and the matter could appropriately be dealt with then.

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– The committee will later consider proposed votes for the business undertakings, it is true, Mr. Chairman, but I crave the committee’s indulgence to deal with this matter now, because the accounts of the Commonwealth Railways must be subject to Treasury investigation, and the proposed vote for the Treasury, which is now before the committee, makes provision for funds for the payment of the salaries of Treasury investigation officers. If I may, I shall put the facts of this matter before the committee now in order that they may be considered by the investigation officers of the Treasury.

If an examination is made of the Schedule of Salaries and Allowances which accompanies the Estimates of Receipts and Expenditure, it will be found that provision is made, on page 173, for clerks and investigation officers in the Department of the Treasury. The matter that I propose to put before the committee is one that will have to be investigated by that particular group of officers, who, I understand, would have their representatives present at the moment, but who would not, perhaps, be here when the proposed vote for business undertakings is being considered. That is why I am asking to be allowed to speak about this matter at present, although I realize that a hairline decision will have to be made by you, Mr. Chairman, to allow me to proceed.

The Commonwealth Railways Commissioner pointed out in his report -

Prior to the construction of the new standard gauge railway between Stirling North and the Leigh Creek North Coalfield, coal traffic for Adelaide was routed on the 3 ft. 6 in. gauge railway via Quorn and Terowie, and for the Port Augusta power-house on the 3 ft. 6 in. gauge railway via Quorn and Stirling North.

The following passage is the matter that the Treasury has to consider: -

A special freight rate of one-halfpenny per ton per mile applied to this traffic, but for many years until the financial year under review (1956-57), the difference between this nominal rate and the Commonwealth Railways standard freight rates was reimbursed by the Treasury to this Department, in accordance with the provisions of section 44 of the Commonwealth Railways Act.

Section 44 of that act provides -

The Minister may direct the Commissioner to make any alteration in any existing practice or carry out any system or matter of policy, but where any such direction, or any direction or proposition given or transmitted in pursuance of the last preceding section, adversely affects the accounts of the railways, . . .

In those circumstances, without going into the details, the Railways Commissioner shall be reimbursed, and the money shall come from the Treasury. The Commissioner’s report continues -

As soon as the new standard gauge railway was available for traffic, the Government of the State of South Australia entered into negotiations with the Commonwealth Government in regard to the freight rate on coal carried over the new railway, claiming that the rate of onehalfpenny per ton per mile should be continued. The Commonwealth Railways freight rate for coal traffic between Leigh Creek North Coalfields and the Port Augusta Power-house has been 33s. for many years. This is the lowest freight rate on any railway system in Australia for coal hauled over a similar distance. The freight rates on the other systems vary from 39s. lid. per ton to 70s. Id. per ton. The negotiations between the two Governments resulted in agreement that the rate should be 1 ls. 6d., which is slightly more than one-third of our standard rate.

As a result of this, the Treasury was asked and expected to reimburse the Commonwealth Railways, up to the end of last year, to the extent of £546,653. In other words, the electricity undertakings of South Australia received favoured treatment at the hands of this Government to the tune of more than £500,000 a year. This favoured treatment that is given to South Australia is not extended to any other State. Tt enables South Australia to operate its electricity system on the basis of favoured treatment received at the hands of this Government as a result of the failure of the Treasury to meet this commitment when the Commonwealth Railways Commissioner made the application. The Treasury would not make the amount available because - and this is the reason why I bring the matter up - as the Commissioner says in his report: -

A claim for reimbursement of the difference between our standard freight rate and the nominal rate agreed upon by the Governments was submitted to the Treasury, but was rejected, with the advice-

This is the important part - tl.ut no provision had been made for its payment during the financial year 1956-57.

I appreciate your tolerance, Mr. Chairman. Let me say that the Commonwealth Railways was denied its just right. The South Australian Government received favoured treatment to the extent of over £500,000, and it gets the same treatment again this year. When the Commonwealth Railways Commissioner makes a similar application in accordance with section 44 of the Commonwealth Railways Act - an act of this Parliament - he will be told exactly the same story, that in this financial year arrangements again have not been made. It comes back to the Treasury again. It was not stated that the Government could not pay the amount; what was said was that the amount could not be paid because the allocation had not been made by the Treasury. So I throw it right back on the Treasury. They will do this year what was done last year, and extend favoured treatment to South Australia. When honorable members compare electricity charges in South Australia with those in other States, let them’ realize that no other State receives this favoured treatment.

Mr Hulme:

– The arrangement was made by Mr. Chifley.

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– It was never made by Mr. Chifley. The subsidy was paid right up until 1955-56, and when the application was made for the subsidy in 1956-57 it was said that funds were not available because the Treasury had not made them available.

I am grateful, Mr. Chairman, for being allowed to deal with this matter during the debate on the estimates for the Department of the Treasury. An examination of the figures, with which I will deal when we are debating business undertakings, shows that what was done last year is being repeated this year. The amount due for reimbursement to the Commonwealth Railways is not being provided by the Treasury this year. As a result, the favoured treatment accorded to Sir Thomas Playford and his Government in South Australia will continue, so that the members of that government can boast that a Liberal government is providing cheaper electricity than the other governments of Australia - although it is being done at the expense of this Government and of the taxpayers, and we are showing a loss in our own operations.

The CHAIRMAN:

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

Mr BURY:
Wentworth

.- We on this side of the House accept with great pleasure the prediction impliedly made by the honorable member for Blaxland (Mr. E. James Harrison), who said that the Minister for Health (Dr. Donald Cameron) is representing the next Treasurer. This was a forecast of the election results with which we on this side entirely agree.

There was a certain amount of confusion of thought as between the honorable member for Banks (Mr. Costa) and the honorable member for Blaxland. The honorable member for Banks deplored the increase in the national debt of about £100,000,000 per annum. The honorable member for Blaxland, on the other hand, attacked the Government because the national debt was not increasing still more steeply. He complained that because of the policy pursued by this Government less and less money was becoming available for Government loans, and we could not build up a still larger debt, and increase it even further year by year. The honorable member for Banks seems to overlook what is the counterpart of the increase, year by year, of the national debt. This £100,000,000, which is invested wholly in the works of the States, has as its counterpart greatly increased national assets. Housing, transport, power and the other facilities that are necessary to expand this economy are in fact the counterpart of the national debt. These assets are increasing a great deal faster, in fact, than is the national debt, for the simple reason pointed out by the honorable member for Blaxland, that we cannot at the moment meet all our commitments from the bond market. The result is that our assets in the public sphere, in one way or another, are increasing at about twice the rate of increase of the national debt.

The honorable member for Blaxland seemed to assume that the railways, once having been given the capital, should not be expected to service that capital. This, in fact, would be quite contrary to the principle in every other type of investment, both in private and public industry, that every amount of capital invested should earn its proper return, and that if any business undertaken seems unlikely to earn its proper return, the investment should not be made.

He referred to railway deficits, but if in fact one looks behind those railway deficits to the behaviour of certain State governments - some more than others - one finds that the rates for freight and passengers are struck on political grounds, and that every economy, such as those suggested by the Ebasco report in New South Wales, is resisted on political grounds. If, in fact, we could remove politics from the railways of this country and treat them on a wholly economic basis, they would not only be very much more efficient but also would yield a good return on the capital invested.

The honorable member for Melbourne Ports also referred to the national debt and the way in which it was handled. There seems to be some confusion in his mind between long-term rates and short-term rates. He seems to think that there is something holy about the relationship which has prevailed in this country and most other countries in the immediate post-war period. But 1 should like to point out to him that in many countries, over many years, the short-term rate of interest has been higher than the long-term rate. If he thinks we could have raised large sums of money and continued to enjoy loans at 2 per cent, from companies such as the Broken Hill Proprietary group, which invested in government securities, in the face of the other investment opportunities offering in every capital city, he is an extreme optimist.

He also attacked the Government for reconverting a loan of £16,000,000 sterling, or £20,000,000 Australian, which became due in London a short time ago. He attacked us for refinancing that at 6 per cent. On that, as he is, perhaps, a potential Labour treasurer in the dim, distant future, all I can say is that his predecessor would, in these circumstances, never have been so silly. At the moment, the prospect is of a continued, sharp and serious decline in our overseas London funds and any refinancing of debt which we can finance now at prevailing rates of interest is obviously a very prudent move. The only sad thing about it is that it would probably be extremely difficult for us to continue to borrow at the rate which our current pace of development justifies.

My real purpose in rising, however, is to say one or two things about the Treasury and its part in overall administration. It has been suggested on a number of sides that the way to solve our problem of overexpanding administration would be to appoint something akin to the Hoover Commission. It is important that the committee should realize the very fundamental differences which exist between Australia and the United States of America. The Hoover Commission was brought into the American scheme at a time of quite unparalleled growth in American government operations. It was a legacy of the Roosevelt administration, which lasted for twelve years - first of the New Deal and then of the war-time agencies which were created hastily by President Roosevelt to serve a number of ad hoc purposes.

It is well known that Government agencies are much easier to establish than to get rid of afterwards. In the United States, President Roosevelt, great politician though he may have been, was probably the most untidy and sloppy administrator who ever held the reins of supreme power in that great country. On many occasions when he quarrelled with a particularly powerful section of his administration, which for political purposes he did not like to get rid of, his tendency was to create alongside it a new, parallel department, and then deal with the man who was placed in charge of that. A consequent legacy of deadwood littered the American scene. Of course, it was followed in the immediate aftermath of war by all kinds of other agencies established ad hoc to deal with foreign aid and many other emergency postwar problems.

There is also in America a dearth of good, sound, public service tradition. Until the New Deal days, the American public service was extremely weak. All the higher appointments were handed out on the spoils system, and only slowly, over the years, have the Americans been managing to eradicate that system and to get away from political appointees to long-term, soundly trained professionals. The American public service still has a long way to go before it catches up with our own or the British system.

Therefore, I suggest that if we continue to look to devices like the Hoover Commission to solve our administrative problems, we shall in fact be looking in the wrong direction. One of the chief ways in which we can tackle the problem - which is. as the Prime Minister pointed out, a continuing one requiring political responsibility to be exercised day by day - is by careful co-ordination of inter-departmental activity and, above all, the prevention of wasteful overlapping both between the Commonwealth and the States and between individual departments. There is a natural tendency amongst all government departments to quarrel with each other on the jurisdictional boundaries which lie between them. The Treasury is the one obvious authority to co-ordinate the activities of such departments. Almost every problem of government involves the provision of finance, and therefore the Treasury is brought into almost every activity. In order that the Treasury may perform its function effectively, it must be properly manned, and its manning, salaries and status must be kept in proper line with those of other departments. It should be remembered that a senior official of the Treasury may be called upon to pronounce seriously on whether or not particular projects should proceed in other departments. Therefore, he should be not just a financial man but also a man who is able to bring sound, balanced judgment to bear on all the problems which are referred to the Treasury, not only by other departments, but by the Government itself. At the present time we have in the Treasury all too few men of first-class talents. Those who are there are in fact at times very seriously overworked because there are so few of them and the activities of government are so many. Government administration does suffer from the fact that because it is so overloaded, many decisions are given too quickly and perhaps at times without sufficient imagination. I suggest that df we are to seek greater economy in government we should have a very close look at the functions of the Treasury vis-a-vis other departments.

Mr CAIRNS:
Yarra

.- There are three points that I desire to raise. One bears upon the question raised by the honorable member for Melbourne Ports (Mr. Crean), the honorable member for Petrie (Mr. Hulme), and indirectly by the honorable member for Wentworth (Mr. Bury). The second concerns the apparent disappearance of the Economic Advisory Committee.

Dr Evatt:

– Has it disappeared, as well as the National Security Resources Board?

Mr CAIRNS:

– Yes. The third point concerns the selling of wool futures overseas. With regard to the first matter, the view taken by honorable members opposite is that the existing financial situation is such that they accept not only the level of expenditure that prevails in the economy, but also the categories or sections of that expenditure established by the banking and financial institutions and by the Government. Accepting this status quo, as it were, they answer that it is impossible to provide any more funds for such things as education, roads or social services or similar purposes. I want to point out to the committee just how this present level of expenditure has come into existence. It is not something that is sacred. It has not come to us as a result of Divine purpose or natural event. This present structure of expenditure has come about as a result of deliberate decisions taken by this Government in association with the financial institutions it serves.

The CHAIRMAN:

– Order! The honorable member cannot discuss the whole economy or entire economic policy now.

Mr CAIRNS:

– I understood, Mr. Chairman, that the line of discussion had been laid down by the honorable member for Petrie.

The CHAIRMAN:

– The honorable member referred to a particular subject, and I allowed it to be debated.

Mr CAIRNS:

– The discussion concerns hire purchase. My remarks were directed to show how the funds for hire purchase have been, in fact, obtained. I think it is taking rather a narrow view to say that you can describe the existing situation without explaining how that situation came into existence.

The CHAIRMAN:

– If the honorable member seeks to discuss education, payments to the States and other such matters, he is broadening the line of discussion.

Mr CAIRNS:

– I was going to discuss how the present structure of hire purchase, which was dealt with by the honorable member for Petrie, came about. Perhaps I can proceed to open up the subject, Mr. Chairman, and you can then judge whether it is relevant or not. The position is that through the Treasury, the Government has put into effect a particular kind of financial policy which has resulted, among other things, in the proportion represented by holdings in the special accounts of the private trading banks following a certain course.

Up to 1950-51, it was the policy of the Government to use the special accounts procedure to keep in check the ability of the trading banks to create funds. In 1950-51, the level of balances in the special accounts was £500,000,000, or an amount equal to 43 per cent, of the total deposits of the trading banks. Under the administration of this Government and through the Treasury, gradually but definitely the amount that the trading banks were required to hold in special accounts was permitted to fall. Other things being equal, this was the key method of controlling the level of expenditure through the banking system.

Slowly and definitely, that percentage fell until, in 1951-52, it was 31 per cent. The percentage in each of the years that followed was 18 per cent., 22 per cent., 20 per cent., 18 per cent, and at present it is 19 per cent. In other words, there is considerably less than half the proportion of funds held in the special accounts to-day by the trading banks than there was when this Government came into office. That meant that the trading banks had a far greater base on which to create their credit structure; a far greater base on which to create money to lend and direct to certain purposes. One of these was their advances. The advances rose from £479,000,000 in 1950-51 to £792,000,000, which is the latest figure I have available, an increase of £313,000,000.

The honorable member for Petrie took the point that if the trading banks themselves do not lend directly for hirepurchase, but only put their own funds into the capital of hire-purchase companies, then that is a situation in which they are not contributing to the hire-purchase boom. But I should like to point out that this £313,000,000 in advances goes into the economy in various directions, and sometimes it is invested directly in the hirepurchase field by those persons who receive the overdraft from the trading banks. But, in any case, whether it is invested directly into that field or not does not matter. The fact is that the monetary circulation is inflated and thus greater volume of expenditure takes place in the community in general.

It is obvious that this volume of created credit has been far too great in recent years; otherwise we would not have suffered from the inflationary effects which are indicated by the very rapid increase in prices - over 20 per cent - that took place in a couple of years. Surely no supporter of the Government can say that the level of expenditure which was allowed to be created in the economy was not far too great. Of course it was! That is proved by the fact that we had inflation during those years. This meant that the created money, which is no more the property of the trading banks than it is of anybody else in the community, goes back to the banks in the form of deposits. Moreover, they think that they have some form of legal claim to it.

This process of money creation has raised the level of expenditure and the returns so that, as the honorable member for Wentworth pointed out, you have to compete with those returns. You cannot hope to get money at 2 per cent, or even 5 per cent. You have to go into the field of highly competitive interest rates. It is only in that kind of investment which can return these astronomical rates of interest, that the money flow will move; and so, fundamentally, that is the reason for the kind of distortion we have in the economy at present.

The first of the other two points to which I wish to refer is the position with regard to the Economic Advisory Committee. Reference to the Estimates shows that, in 1956-57, £176 was spent on this committee. Nothing was spent in 1957-58 and there is nothing for the committee in the Estimates for 1958-59. What has happened to the Economic Advisory Committee? I ask that question because I want to direct attention to what was said a little while ago. On 22nd February, 1956, in reply to a question by the honorable member for Petrie, the Prime Minister (Mr. Menzies) said -

The Government some two or three weeks ago decided that it would have great benefit if it could secure the advice of a panel of people on economic problems broadly, the whole idea being to get a series of views derived from various skills and experiences outside the normal sources of expert advice available to the Government. We therefore appointed a committee.

The Prime Minister went on to say that those appointed to the committee were some of the most distinguished economists and economic advisers in the community. They included Sir Roland Wilson, Dr. H. C. Coombs, Mr. L. G. Melville and Sir Daniel McVey. It was a most distinguished committee. The Prime Minister spent considerable time pointing out to the House how important it was that this committee should be appointed and he said that he had, in fact, appointed it. A little later, in reply to a question by the honorable member for Scullin (Mr. Peters), the Prime Minister said that the whole question of credit policy, behind the thing I have just been discussing, had been under constant discussion between the central bank and this Economic Advisory Committee.

Here was this committee at the very centre of the most important economic discussions in February, 1956. Then, as far back as 14th March, 1956, in making his statement on the Australian economy at that time, the Prime Minister said that the Economic Advisory Committee had been intimately concerned with the discussions on the state of the Australian economy in that year. March, 1956, was the occasion of the introduction of the supplementary budget of that year about which nothing had been said before the general election. According to the Prime Minister, the Economic Advisory Committee was doing most important work through that time. Then the Prime Minister referred again to the important work that this Economic Advisory Committee had done in relation to advising on investment from overseas. So, throughout that time, this Economic Advisory Committee had performed a most important function. But suddenly it has disappeared. What has happened to the Economic Advisory Committee which in 1956 and 1957 was said by the Prime Minister and this Government to be of such great importance? This is about the only reduction in the number of advisers of the Government that I recall to have taken place recently. I think we are entitled to have some explanation of that. This Economic Advisory Committee, which had on it some of the most distinguished people in Australia, was essential to the Government in 1956 and 1957, but it has now disappeared, and not one word has been said as to the reason for its disappearance.

I want to raise now an important matter which I raised this morning in the form of a question to the Treasurer, who completely brushed it aside in a manner which, unfortunately, is associated with some of those Ministers who are, unlike the retiring Treasurer, likely to be members of this chamber for some considerable time. The Treasurer showed no knowledge of this particular problem and no concern with it. I pointed out in the question that it had been stated that the operation of the wool futures system - the selling of wool futures in London - by a ring in this particular field had resulted in a decline of £100,000,000 in Australia’s proceeds from wool sales since 1957. I pointed out that the process of bearing the market, or selling futures, was a well-known practice of monopoly rings, which operate with the deliberate purpose of reducing the prices of commodities being sold. That is to say, when the sales take place a price is fixed for the future, and this small monopoly group sells the wool by agreement at that price in the future. If they can force down the price of wool in the meantime so that they can buy later at a lower price than that at which they have agreed to sell the wool, then sell it at the formerly agreed price to manufacturers with whom they have made agreements, they make a profit. It is their function to buy wool at the lowest possible price, and this kind of operation is a wellknown device for reducing prices.

I suggested in my question that thissystem was being operated on the wool market, and I asked what the Treasurer wasgoing to do about it. The right honorable member brushed the matter aside, soI raise the question again now: What is the Treasurer going to do about this situation?

The TEMPORARY CHAIRMAN (Mr Bowden:
GIPPSLAND, VICTORIA

– Order! The honorable gentleman might raise that in connexion with the appropriate proposed vote, that for the Department of Primary Industry.

Mr CAIRNS:

– I think that this matter certainly enters into the Treasury field.

The TEMPORARY CHAIRMAN:

– It does not come within the purview of the proposed vote with which we are dealing.

Mr CAIRNS:

– It is surely a matter in connexion with which the Treasury will have to decide the action to be taken. The commodity concerned happens to be wool, but the selling of futures also vitally affects Australia’s overseas funds, so I should think the Treasury would be exceedingly interested in the matter. However, I have discussed it, and I think what I have said should achieve my purpose, so I do not intend to say any more about it.

The TEMPORARY CHAIRMAN:

Order! The honorable gentleman’s time has expired.

Mr WILSON:
Sturt

.- I desire to take this opportunity to express my appreciation of the magnificent service rendered to this country by the Treasurer (Sir Arthur Fadden). The Treasurer has guided the finances of this country during the period of its greatest prosperity, during the period of its greatest development, during a period when its population has increased by 2,000,000, during a period when 1,000,000 people have come to this country of their own free will because they realize its great potentialities. The Treasurer has guided the destiny of this country in the face of the greatest difficulties. There have been times when inflationary pressures have been exceedingly great. The Treasurer has not hesitated in the face of the fiercest press and public opposition to take such action as he felt was right to bring about stability in prices. On each occasion the Treasurer has taken this strong action he has succeeded, and the very people who criticize him have come to see that he was right.

While the Treasurer has guided its finances, Australia has progressed from year to year to such an extent that people overseas have had such confidence in this country that they have invested £500,000,000 here. What greater compliment could there be to the work of the Treasurer than the preference shown by people overseas to invest their money here rather than in their own countries? I feel that all Australians will say to the Treasurer, on his retirement, “ Thank you for the magnificent job you have done”.

The only matter with which I wish to deal during the debate on this proposed vote is Commonwealth superannuation. I have pointed out on previous occasions that the Commonwealth Superannuation Fund, which has everything to commend it and which provides magnificent security for the civil servants of this country, simply goes on building up. Every year the amount paid into this fund by members of the civil service, when added to the interest on the accumulated fund, is more than the amount drawn from it by retired civil servants. As a result of that fact, since its operation the amount of £50,700,000 has accumulated in the fund. During this year the receipts from contributions by members of the Commonwealth civil service amounted to £6,100,000. The interest on the accumulated fund amounted to £2,200,000, making the total receipts other than Government contribution £8,300,000. Out of the fund was paid in pensions and repayments to dependants of civil servants a total of £6,300,000, leaving a surplus of contributions by civil servants over payments to retired civil servants and their dependants of £2,000,000. When we add to that the Government contribution this year amounting to £4,300,000 we find that this fund has increased during the year by a further £6,000,000, bringing its total accumulated assets as at 30th June, 1958, to £56,000,000.

I think any honorable member will agree that that is a very healthy reserve; but I believe that the time has arrived when the trustees of this fund should do something about this accumulation. I do not for one moment suggest that the Government on its own initiative should take any action, because, after all, this is money contributed by civil servants. It is their money and it is for them to decide about the administration of the fund. I suggest that the time has arrived at which the reserve fund is sufficient and at which the civil servants themselves could and should make a recommendation to the Government for an increase in payments, particularly to dependents of deceased civil servants.

I feel that this fund has been looked at through the eyes of an insurance man. With private superannuation funds or insurance schemes, obviously provision has to be made for the possibility that the insurance company will not be able to carry on any longer or that the private manufacturing or commercial firm will go out of business. Therefore, in all insurance funds provision is made whereby funds are accumulated to enable payments to be made to the contributors at a time when the fund may cease to exist. These circumstances do not arise in relation to the Commonwealth civil service.

Whether we like it or not, the Commonwealth civil service goes on for ever and there will always be civil servants so long as there is a democratic Australia. Therefore, I believe that the approach to this fund has been based upon an entirely erroneous method. The current approach to funds of this nature which are permanent in character, such as national insurance schemes, large security schemes and superannuation schemes of governments, as opposed to superannuation schemes of private individuals, is to use what is known as the assessment method instead of the insurance method. Under the assessment method the fund makes sure that its contributions in each year will be sufficient to pay its commitments in each year. As long as that situation is provided for, no purpose whatsoever is served by building up a bigger and bigger fund.

However pessimistically one may view the future, one must say that there is now an adequate reserve in the Commonwealth Superannuation Fund. Consequently, from now onwards, we need only ensure that the contributions to that fund together with the Government’s supplement is, this year, next year, and at all times, adequate to meet the calls that will be made upon the fund.

Therefore, if those who are responsible make representations in this connexion, I ask the Treasurer to give favorable consideration to introducing the legislation necessary to bring this proposal into effect. The time has arrived when substantial improvements could be made in superannuation payments, particularly to the wives and children of superannuated officers.

Several speakers opposite have referred to hire-purchase interest rates. Members on this side of the chamber have repeatedly stated that it is not within the constitutional competence of this Parliament to fix such interest rates. The powers of this Parliament are set out in section 51 of the Constitution.

Mr Ward:

– And what is more you do not want the power.

Mr WILSON:

– Whether we want it or not, if the honorable member for East Sydney knows anything, he knows that if we have not the power we would have to go to the people by way of referendum to get it. He knows, too, that almost every time a Labour government has put a question to the people at a referendum, the people have knocked back the proposal.

Therefore, in this democratic country, in which the people properly decide what powers this Parliament should have, surely it is our function to work within the limits of those powers. The States have power to fix interest rates. They have all the powers that are not expressly given to this Parliament. The State governments have, in many instances, passed legislation to deal with interest rates. If the Labour governments of New South Wales and Western Australia think that there is anything wrong with hire-purchase interest rates, let them pass the necessary legislation. Why SOO their members on in this chamber to talk about something that this Parliament has no constitutional power to deal with?

It is becoming extremely boring to have to sit and listen for hour after hour to Labour members who have nothing to talk about over which this Parliament has power, but waste the whole of their time saying that we should do something which, constitutionally, we have no power to do. We have enough to do in this national Parliament in dealing with matters that are entrusted to us, without wasting hours of time in listening to Labour members, ad nauseum, telling us that we should be doing something that they well know we have no power to do.

Mr STEWART:
Lang

.- I desire to bring to the notice of the committee a harsh and unjust provision of the law relating to the taxing of the undistributed profits of private companies. I shall outline briefly, the provision in the act for the taxing of the profits of private companies. The primary tax at the present time is 4s. 6d. in the £1 on the first £5,000 of profit, and 6s. 6d. in the £1 on the whole of the remainder. The primary tax, after being assessed, is deducted from the taxable income to give a distributable income. Out of this distributable income, provision can be made for a retention fund and it is calculated as follows: From the dividends from other private companies, no percentage is taken. From property income, 10 per cent, is taken. From other income, between 25 per cent, and 50 per cent, is taken, on a sliding scale. After the retention allowance has been decided, it is deducted from the distributable income to give what is known as the sufficient distribution. The sufficient distribution has to be distributed to shareholders within a prescribed period and that period is a whole year commencing two months before and finishing ten months after the close of the year of income. If the distribution to the shareholders is not made within the prescribed period, the undistributed amount bears additional tax of 10s. in the £1.

For example, let us consider the tax payable by a company for the year ended 30th June, 1957. The taxable income as per assessment, including £500 in dividends from private companies, was £10,000. After allowing for a rebate on the £500 in dividends from the private companies, the net tax was £2,613. Taking that net tax away from the taxable income, we arrive at a distributable income of £7,387. We subtract from that distributable income the amount of the retention allowance, which, in this case, would work out at £2,028, leaving a sufficient distribution of £5,359. If, out of this sufficient distribution dividends were paid - one of £500 at the earliest possible date of 1st May, 1957, one of £1,500 on another date, say 15th

October, 1957, and one on the latest possible date, 30th April, 1958, of £2,000 making, in all, a total of £4,000 - an undistributed amount of £1,359 would be left. On this undistributed amount an additional tax of 10s. in the £1 would be levied amounting to £680, leaving a balance of £679. In order to avoid the additional tax, the April, 1958, dividend should have been £3,359. lt must be noted that the foregoing applies to taxable income, that is, the income on which tax is payable in terms of a notice of assessment or amended assessment. Such taxable income may often differ from the net profit shown on a company’s books of account. Most frequently it is higher than the company’s profits by reason of the taxation office disallowing certain items of expense, or including as assessable income some amount which the company had not treated as trading profit subject to tax.

It often happens that a company is not in a position to know, by the end of the prescribed period, what is a sufficient distribution. This can arise in three ways: First, if a notice of assessment has issued before the close of the prescribed period; second, if an amended assessment increasing the previously notified taxable income - and automatically the sufficient distribution - is issued after the prescribed period had passed; and third, if an objection, reference to a board or appeal to a court is pending. These three situations can arise some years after the prescribed period has expired.

It is to be noted also that the Taxation Branch gives no advice to the taxpayer when a return is not taxable. This provision is extremely harsh if a primary assessment has been made and the company, acting on this advice, has declared1 sufficient dividends to avoid payment of the 10s. additional tax. But the Taxation Branch, perhaps some years later, might issue an amended assessment increasing the taxable income and causing an automatic rise in the sufficient distribution.

Once the prescribed period has expired - which is two months before the close of the year and ten months after the close of the year in which that income has been earned - neither the Taxation Branch nor the company can do anything about the undistributed profits. If they have not been distributed within that period the additional tax of 10s. in the £1 is imposed. As I said earlier, there are three circumstances in which a company can in no way be blamed for not having distributed the sufficient income before the prescribed period has elapsed.

I feel that the time limit for a company to declare dividends must be stipulated in the act, otherwise some companies, in order to refrain from paying their just tax, would refuse to declare a dividend for some years. However, some exceptions should be made in the act to provide for cases such as I have mentioned. One is if an assessment has not been given before the prescribed period has expired and secondly, as a result of a subsequent assessment being issued increasing the taxable income and automatically increasing the sufficient distribution. If the period has expired before these events take place then I feel that the Taxation Branch should have the right to extend the period so that further dividends can be paid out of the undistributed profits by private companies. This would remove a harsh and unjust provision in the taxation law. I ask the Treasurer (Sir Arthur Fadden), through the committee, to see that something is done about this matter.

Mr GALVIN:
Kingston

.- I rise to reply briefly to the honorable member for Sturt (Mr. Wilson), who accused members on this side of the chamber of buying into this hire-purchase business as he called it and of beating the drum for the State governments. After making his accusations he disappeared from the chamber as quickly as he could, just as many other members on the Government’s side are running away from this important issue of hire purchase.

It is not good enough for them to say that the Commonwealth has no constitutional power to deal with hire purchase and that the States should do something about it. If the Commonwealth has not any power, why does not the Government legislate for suitable power, particularly as its supporters admit that hire purchase is such an evil? I am sure that members on this side of the chamber would support such legislation.

The honorable member for Sturt said that the State governments should do something. The New South Wales Labour Government attempted to do something but the result was that hire purchase companies in that State very smartly registered their organizations in South Australia. It is quite easy for them now to sign agreements through the South Australian set-up and avoid any legislation which the New South Wales Labour Government seeks to implement. That is how they dodge the State laws. The Commonwealth Government cannot sit idly by and try to get out of this issue by saying that it has no control over the matter.

Let me make it clear that members of the Labour party are not opposed to hire purchase. We realize that it is most essential to the people of this nation, not only to workers but to those in all walks of life because of the state which the economy of this nation has reached. The people are dependent upon hire purchase to buy goods. By using this method of finance they keep the manufacturers producing more articles and, in turn, maintain employment at a fairly high level.

But it is unnecessary that such high interest rates should be charged. The honorable member for Hume (Mr. Anderson) said that members of the Opposition were appealing to the immoral instincts of man. That is not so at all. What we are doing is to attack the exploitation of the people of this community just as we have always done. At the present time the bankers and the financiers of this country have pushed their way into what the honorable member for Parkes (Mr. Haylen) has described as blackmarket banking to exploit the unfortunate economic position of the people. The honorable member for Hume should know that it is impossible to-day for farmers to obtain money on overdraft with which to buy machinery or those goods that are so essential to them. But the very same banks that say that you cannot have an overdraft will direct you to the hire-purchase companies, in which they have interests, and from which you can borrow money at a very high rate of interest.

The problem can be dealt with in one of two ways: This Government could convene a conference with the States to see whether uniform legislation can be agreed upon. Honorable members should not forget that this Government has a responsibility to the residents of the Australian Capital Territory and the Northern Territory and that it cannot pass the buck to the States in relation to those territories. If the Government cannot get agreement that way, it has a simple remedy. It should reverse the instructions that it gave to the Commonwealth Bank some time ago and allow that bank to enter into virile competition with hire-purchase companies. The Government says that the hire-purchase companies are in keen competition with one another, but an examination of their interest rates shows that there is very little competition and that the purchaser of goods has very little choice in the matter. But if the Commonwealth Bank were allowed to enter the field these other organizations would soon be forced out of business. Hirepurchase companies are only in the business for the big rake-off that they are getting at present. Let me give honorable members a few figures about hire purchase. If you borrow £100 for twelve months you repay £125 10s. If you borrow £120 you repay £148 10s. If you borrow £140 you repay £170, and if you borrow £180 you repay £214, in each case taking a period of twelve months.

Just to show that we on this side are not the only people concerned about high interest rates, let me quote from the “ Sunday Telegraph “ of 30th March, 1958. The article reads -

Australians in the mass are now familiar with hire-purchase charges that are two to three times as great as the overdraft rates that banks are permitted to charge. . . . More than two-thirds of current capital expenditure by Commonwealth and States is now having to be met from taxation instead of loans.

The heading to this article states -

Call a halt to this usury!

The article explains how hire-purchase companies are exploiting the community. In an editorial last week the Sydney “ Truth “, under a heading “ Reaping the fruits of greed “ said -

The State Government intends to follow the example of some other States and introduce legislation to tighten control over hire-purchase companies.

This newspaper has always believed that hire purchase, properly conducted, is a boon to the working man.

It enables him and his family to enjoy a measure of gracious living that would otherwise be denied them. It imposes upon him a form of compulsory saving.

It enables large Australian industries, manufacturing durable consumer goods and employing tens of thousands of hands, to keep going and to expand.

Unfortunately, while some of the hire purchase companies have been content to make reasonable profits, others have been too grasping, charging exorbitantly high interest rates to their customers.

It is the greed of these firms that has brought the whole field of hire purchase into disrepute and compelled State governments to act in order to protect the people.

In plain words, they have brought upon themselves whatever interest-restricting legislation Governments feel constrained to introduce.

Mr Haylen:

– Have you worked out the interest on a television set?

Mr GALVIN:

– No, I have not, but I can tell the honorable member for Parkes that if he cares to invest £10,000 in a hire-purchase company for three years, relending the repayments as they are made, he can turn his £10,000 into £26,500.

Mr Stewart:

– How many years would that take?

Mr GALVIN:

– Three years. That shows how much profit there is in this type of business. Hire-purchase companies are offering investors 12± per cent, on their money at a time when people cannot get money to buy or build homes. Of course, if you want money for a home and you cannot get it from the banks, you can, if you wish, apply to the hire-purchase companies, which will lend you money at a flat rate of interest to buy land or a home. It is black-market banking. It is banking in perhaps a new form but it is banking, because the trading banks of this country are the very people who are running the hire-purchase companies. Let me show honorable members the connexion between hire-purchase companies and the private banks. The Australia and New Zealand Bank Limited has interests in Industrial Acceptance Corporation Limited. The Bank of Adelaide has interests in Finance Corporation of Australia Limited. The Bank of Adelaide will lend you as much money as you want to buy land in South Australia, but if you try to get an overdraft to purchase urgently needed machinery for farms, no money is available. The Bank of New South Wales is tied up with Australian Guarantee Corporation Limited. The Commercial Bank of Australia Limited has interests in General Credits Limited. The Commercial Banking Company of Sydney Limited has interests in Commercial and General Acceptance Company Limited. The Eng lish, Scottish & Australian Bank Limited has interests in Esanda Limited. The National Bank of Australasia Limited has interests in Custom Credit Corporation Limited.

This Government cannot idly brush aside this problem of hire purchase and high interest rates. It cannot run away from the problem. It must face up to its responsibilities. The people will demand that it do so. I appeal to the Minister for Immigration (Mr. Downer), who is at the table, to use his influence with the Government. Perhaps it is a pity that he is not in charge of the Government, because if he were I think he would do something about this matter. Somebody must set a lead. The States cannot do it. Only Commonwealth action in conjunction with the States - a unified effort - can protect the people and do away with this black-market banking, as the honorable member for Parkes (Mr. Haylen) called it.

Mr CREAN:
Melbourne Ports

.- I join with my colleague, the honorable member for Kingston (Mr. Galvin), in suggesting that the Government, by throwing up its hands in horror every time hire purchase is mentioned and saying that it can do nothing about it, is failing this country in its capacity as the custodian of the Treasury for the time being. Hire purchase affects our economy. The Treasury Information Bulletin to which I referred earlier, and which is published four times a year by the Treasury, contains statistics on hire purchase. The latest issue indicates that the total amount owed to hire-purchase companies that are registered as such is in the vicinity of £300,000,000. That sum of money is a significant part of the financial sector of the Australian economy.

Indirectly such a large amount of money tied up in hire purchase must have important repercussions on the whole economic life of the community. Such industries as the electrical trades industry, which sells radio and television sets, and the automobile industry, are ultimately dependent on hire-purchase finance as a method of buying their products, because it must be recognized that in the Australian community, as in any other community, when the majority of people have to buy any durable goods the total cost of which exceeds about £100, they have to find some method of financing the bulk of the payment. The Labour party says that because of this economic necessity steps should be taken by those in authority to see that that money is made available at the lowest possible rates of interest, To-night, when he invoked the name of the former Leader of the Labour party, the late Mr. Chifley, the honorable member for Petrie should have added that Mr, Chifley believed in finance being provided not at the highest possible interest rates, but at the lowest possible interest rates. I throw back to the honorable member for Sturt (Mr. Wilson) the challenge that the Government can do nothing whatever in this field.

I shall give a very personal example to show how this evil is growing in the community. As most honorable members know, I recently had the honour to represent Australia at a conference of the InterParliamentary Union. Like most members of the Labour party, I have no source of income other than my parliamentary salary, but I think that a member of Parliament is entitled to think of his wife and his family occasionally. Therefore, I took my wife with me on this trip. When I came to add up the total cost of the air fares, I found that I was, in round terms, £350 short of the total sum. So, I availed myself of a service offered through a Government undertaking - Qantas Empire Airways Limited. This service is offered by most airlines and shipping companies here and in other countries. It is euphemistically described as “ Pay as you fly “.

I found that the company would permit me to pay back the £350 over a period of twelve months. For that service I was charged nearly £50. In other words, instead of paying back £350, I will pay back £400. I do not pay it directly to Qantas Empire Airways Limited; it is taken quite easily out of my bank account each month. I do not think that any one who knows the seat of Melbourne Ports will regard it as a very uncertain risk for the next few years. The amount is taken out of my bank account each month and paid, not to Qantas Empire Airways Limited, but to Australian Guarantee Corporation.

Hire purchase has almost reached the level of immorality in the community, and this Government, which says it can do nothing, is condoning the immorality. Tn the instance I have given, the Government can do something because if Qantas Empire Airways Limited is to finance its passengers, the Government could set aside a sum to be lent at 5 per cent, or 6 per cent, for this purpose. In my case, the flat rate of interest is in the region of 14 per cent., but if it is taken as it should be taken on a compound basis, it is probably in the region of 20 per cent.

The TEMPORARY CHAIRMAN:

–

Order! We are discussing the administration of the Treasury.

Mr CREAN:

– We are touching on the whole of the Treasury.

The TEMPORARY CHAIRMAN:

No, the administration of the Treasury.

Mr CREAN:

– I would draw the attention of the Chairman of Committees

The TEMPORARY CHAIRMAN:

–

That is not necessary. We are discussing the administration of the Treasury.

Mr CREAN:

– Last year, the Treasury raised a loan of £1,518,000 for Qantas Empire Airways Limited at the rate of 4f per cent. If Qantas Empire Airways Limited borrows its money at 4i per cent., it should be a little more generous in the way it treats its patrons who cannot pay cash for the flight they wish to undertake. This agency is a direct responsibility of the Government and it is one point at which the Government could intervene to reduce the interest charges and to offer a little competition. The Government talks about private enterprise and competition, but private enterprise and competition should at least have decent standards attached to them.

It is time that the Government found a different answer to our challenge than to suggest that nothing can be done. A great deal can be done if the Government really wants to do it. Very soon, the people will judge the Government and they will want something more than blank denials and assertions that hire purchase does not concern the Commonwealth. It concerns the whole of the community, because each year more than 1,000,000 transactions, in one form or another, are entered into, and to suggest that a government could not do anything about it is an abdication by the Government of its responsibility. If the Government is not prepared to accept its responsibilities, it is time it was changed. We need a government that will act in a responsible way in the interests of the ordinary people and not, to use the words of my friend, in the interests of the usurers who profit for the time being on the economic necessity of the majority of the people.

Proposed vote agreed to.

Attorney-General’s Department

Proposed Vote, £1,835.000

Mr WARD:
East Sydney

.- I understood that the Government had originally intended to report progress at this stage.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– No, we are going on to the Department of the Interior.

Mr Crean:

– The Attorney-General’s Department is next.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I know, but we will finish this and go on to the Department of the Interior.

Mr WARD:

– You will finish this at a very late hour, if that is what the Government is going to attempt.

It appears that this is an opportune time to say something about court-controlled ballots, because they appear to come within the ambit of the Attorney-General’s Department. Recently, many things have been said about these ballots. It is perfectly true that the Chifley Labour Government brought down legislation in this Parliament, which was adopted, providing for courtcontrolled ballots in certain circumstances. If malpractice could be proved or if some evidence could be produced to show that there had been malpractice in a trade union ballot, the Registrar in the first instance, if he was satisfied, allowed the matter to proceed to the court. The court then decided whether a court-controlled ballot would be held.

However, this Government, in its desire to injure the trade union movement and to make it an ineffective instrument against the big monopolies, decided to bring down its own provisions for court-controlled ballots. For a court-controlled ballot to be held, all that was necessary was for a sufficient number of members of a union to sign a petition. The petition could be presented to the Registrar and, if the necessary number of signatures appeared on the petition, then a court-controlled ballot was held. The number of signatures required constituted a very small minority of the total membership of a union. What has happened since this Government interfered in this way in the normal business of trade unions? This Government’s provision for court-controlled ballots has nothing to do with malpractices in trade union ballots. Evidence of malpractice is not needed; all that is necessary is a number of signatures on a petition. The cost of court-controlled ballots must be borne by the unions.

Mr Peters:

– It should be borne by the Government.

Mr WARD:

– The Government should at least bear any additional expense incurred by a union above the normal cost of a union-conducted ballot. Many of the unions have suffered considerable financial loss as a result of court-controlled ballots. I think it must be the Government’s intention that they should suffer such losses, because the Government has worked very closely, I regret to say, with certain elements in the trade union movement. I am pleased to say, however, that those elements constitute only a minority in the movement. Nevertheless, they evidently have been able to conduct a campaign to harass trade union officials by trying to prevent them from doing their work effectively and, at the same time, trying to embarrass them by imposing upon the unions the financial burden represented by the cost of court-controlled ballots.

I shall give the committee an illustration of what has happened. The costs incurred, up to date, by one union that I know of for the conduct of court-controlled ballots are approaching £20,000 - an amount much in excess of the normal cost to the union of conducting its own ballots. I shall indicate to the committee the ridiculous state of affairs that exists. When it was proposed to hold a ballot in the union, a petition was served on the Industrial Registrar asking for a court-controlled ballot. When nominations closed, there was only one nomination. There was no need for a ballot at all, but so interested is a certain element in embarrassing unions that, as soon as a union election is suggested, in goes a petition for a courtcontrolled ballot. How can there possibly be any malpractice, or any thought of malpractice, when it is not even known, at the time a petition is presented, how many nominations will be received? In this instance, as I have said, there was only one nomination.

I should like to bring to the attention of the Minister for Labour and National Service (Mr. Harold Holt) another point in relation to these petitions. The law should provide that when petitions are presented - even by a very small minority of the membership of a union - the union representatives shall have means by which they can check the bona fides of the signatories to the petition in order to be satisfied that the petition is genuine and in accordance with the terms of the law. I understand that it is necessary for the person presenting a petition to supply to the Industrial Registrar a statutory declaration that the signatures were genuine and that the signatories were financial members of the union. But I have learned that when the representatives of a particular union recently sought an opportunity to check the bona fides of those who had signed a petition they were unable to do so. I do not blame the Registrar in this instance, because he must do as the law provides. I understand now that he has a discretion as to whether he will make a petition available to people in responsible positions in trade unions who wish to examine it in order to see what the signatures to it imply and whether the signatories are financial members of the union. I know of no case in which a petition has been made available to the bona fide representatives of a union.

In the case to which I refer, the application was refused. However, officers of the union - I shall not say how - obtained particulars of some of the names on the petition and began to investigate the people whose names had been obtained. The officers were able to obtain a statutory declaration from one man whose name had appeared on the petition but who had not signed it. He had not even been asked to sign it. Another man had signed it because he had not fully understood what it was for. It had been misrepresented to him. When a check was made, it was found he was not even a member of the union concerned. These facts indicate the ridiculous state of affairs that exists. The officers of the union presented to the Industrial Registrar a second statutory declaration which proved conclusively that the first one, which had been supplied in support of the petition, was false. The officers asked the Registrar to check the two statutory declarations and take appropriate action if he was able to satisfy himself that the person who had made the second statutory declaration was not a member, much less a financial member, of the union concerned, and had been induced by misrepresentation to sign the petition. But the Registrar did not act in the matter. He said that action could be taken, and he left it to the union to accept the responsibility of doing something. If the union representatives wanted to test the matter, the union was to be involved in further expense.

The present situation is most unsatisfactory, and the allegations made by various responsible unions ought to be completely and thoroughly examined. If the Government persists in keeping on the statute-book this law, which in my opinion, is designed to injure and limit the effectiveness of the trade unions, it should at least ensure that when petitions are presented to the Industrial Registrar the bona fide officials of the union concerned shall be able to examine such petitions and test them in order to ascertain whether they have been signed exclusively by financial members of the union concerned. That is all that the unions are asking for to-day. Therefore, we do not want the Minister and other Government supporters to start talking about malpractices in trade union ballots. No Labour member suggests for one moment that malpractices should bc allowed in the conduct of trade union ballots any more than in other ballots.

Why has the Government selected the trade union movement for special attention? Are trade union ballots conducted so very differently from other ballots, and are there difficulties in the conduct of trade union ballots that are not found in the conduct of other ballots? There are none of these differences, and therefore as a trade unionist, I very much resent the Government’s action in choosing to impose measures such as this on the unions in order to weaken them and reduce their effectiveness. I hope that the

Minister for Labour and National Service will properly explain the matters that I have raised, and I trust that the complaints made by the various trade unions will be heeded.

Mr WENTWORTH:
Mackellar

– Mr. Chairman, it is very seldom that I find myself in agreement with something that the honorable member for East Sydney (Mr. Ward) has said, but I do find myself in that unusual position this evening.

Mr Peters:

– The honorable member must have second thoughts sometimes.

Mr WENTWORTH:

– It is seldom indeed that I find myself in agreement with the honorable member for Scullin (Mr. Peters), who, earlier this evening, made an interjection with which I agreed. Such a double is a very unlikely one, but it comes off every now and again. The honorable member for East Sydney, Sir, elicited an approving interjection from the honorable member for Scullin when he said that he did not see why a union should be responsible for the additional cost of a courtcontrolled ballot. That, I think, is a not unreasonable contention, and it is something which the Government should perhaps consider.

It seems to me reasonable that when a union, or a number of members of a union, requires the services of the electoral machinery for the conduct of an election of officers in that union, the services of the Commonwealth’s electoral machinery should be made available to the union without additional cost to it. The unions concerned are registered with the Commonwealth Industrial Court, and they have some quasi statutory powers. Therefore, the Commonwealth should be concerned to ensure that persons elected to office in those unions are people whom the members genuinely desire to hold office. We know - and honorable members on both sides of the chamber will admit - that, in the past, there have been malpractices in certain union elections. We do not want them, and the honorable member for East Sydney does not want them. A union might, I think, have some genuine grievance if it is placed in a position in which it has to spend money because a number of its members, who may or may not constitute a mere minority, want a ballot to be courtcontrolled. This would be a genuine grievance, I feel, and one which might well be redressed. I would support the suggestion made in this regard by the honorable member for East Sydney.

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

– lt is quite refreshing to find the honorable member for Mackellar (Mr. Wentworth) agreeing with us, at long last, in respect of this particular aspect of trade union affairs. As the Minister responsible for the Government’s industrial legislation is in the chamber to-night, we may well carry the matter to a stage at which we can get some agreement on this question of court-controlled ballots.

It was a Labour government that first provided that if it can be shown, reasonably satisfactorily, that some malpractice has occurred in connexion with a union ballot, that ballot may be set aside. Of course, the classical case was the removal of Thornton from the leadership of the trade union movement, which occurred as a result of the Chifley Government’s legislation. It is tragic to think that that legislation was ever interfered with. I am prepared to suggest that had it been allowed to remain intact, there would have been less trouble in the trade union movement to-day with regard to Communist leadership than there is in the present circumstances.

It might well be said that the political factions that have developed in the industrial movement have increased the problems of trade unions with regard to courtcontrolled ballots. In the trade unions to-day there are certain groups of persons, as has been pointed out by the honorable member for East Sydney (Mr. Ward), who are continually attempting to disrupt the proper functions of the unions. What worries me most of all is the development of a belief, shared by a great body of trade unionists, that there is something wrong with the Industrial Registrar’s approach to the problems that are brought to him by the trade unions. The honorable member for Bendigo (Mr. Clarey), who has had long experience in the trade union movement, will, I am sure, agree that we cannot allow the development of a belief among unionists that the trade unions have a disagreement with the Industrial Registrar.

Through the years the Industrial Registrar has been looked upon by the trade union movement and its leaders as a guiding factor in the settlement of union problems. When a union has a set of rules to be amended or re-registered, the man to whom it looks for guidance is the Industrial Registrar. One such gentleman, now retired, who was held in the highest esteem by the whole of the trade union movement was Mr. Murray Stewart, who for so long acted as guide and philosopher for the unions. The man who followed Mr. Murray Stewart in the position originally enjoyed the confidence of the trade unions. This Government’s legislation, however, placed a tremendous responsibility upon him. He is called upon to determine matters that should never come before him for decision.

We discussed these aspects of the situation when the legislation was being debated some time ago by this Parliament, and we on this side contended that the proposed system would tend to wreck the very things that the trade union movement had created. After all, as has been said by the honorable member for Mackellar, the leadership of the trade unions should reflect the majority view of the members of those organizations. The first thing that the Registrar has to do is to analyse the legislation of this Parliament. Then he has to follow the interpretations of the court in matters arising out of the legislation. During the last five years we have seen the situation developing in which the trade union movement has lost confidence in the Industrial Registrar. The Registrar is a man who stands high in the community. But I ask honorable members to consider the decisions that he has to make, under, for instance, section 160 of the act. It is there provided that he may exercise his powers under the last preceding sub-section, which sub-section lays down that he has to determine what are reasonable grounds upon which to take particular action, or to decide whether the circumstances justify an inquiry by the court.

These are the kinds of decision that a registrar should not be required to make. If these inquiries have to be undertaken, it should be only after the production of prima facie evidence of some malpractice within an organization, and the inquiries should be undertaken by the court. The Registrar has to accept the responsibility of seeing that the rules of a trade union comply with all the requirements of the legislation and of the decision of the court in relation to those rules, and his responsibility should end there. He should not have to interpret his own decisions and make the various determinations that are now provided under this Government’s legislation.

As I said when the Parliament originally debated this industrial legislation, these provisions place upon the Industrial Registrar a burden that he should not be called upon to accept. Consider section 107 of the legislation, and what happens when a request is made to the Registrar by a body of persons who, in many instances, are more concerned with their own miserable political ends than with the welfare of the organization of which they are members. They come to the Registrar, as was pointed out by the honorable member for East Sydney, in many instances with faked lists, snowing the names of Bill Jones, Tom Henry, Bill Smith and so on. At that point the responsibility rests on the Registrar to make a decision as to what he will do in relation to the matter.

I put it to the Minister that it is time that a decision was made that the Government should bear the whole cost in cases in which court-controlled ballots are ordered. I put it also that it is time we reverted to the earlier kind of legislation. We agree that if it can be shown to the court that malpractice has occurred in relation to a union election, it should be corrected. No one in this committee disagrees with that proposition. If we are to restore the situation in which the trade union movement carries its rightful share of responsibility for the progress of the nation - and there is a responsibility on it to arrive, by conciliation, at peaceful settlements of disputes as they arise - the first thing to be done is to weld together the members of the unions behind their leaders; the second thing is to restore confidence in the Registrar. This cannot be done while the present kind of legislation is on the statute-book. Week by week and month by month the situation is deteriorating. The leadership of the trade unions is being continually undermined because of the dissention that is fomented by certain groups within the unions, not for the purpose of building up the organizations or of assisting the country, but merely of wrecking the trade union movement as such. 1 join with the honorable member for East Sydney in putting the strongest possible case for a return to the principles adopted by the Chifley Government in dealing with this problem of malpractices within the trade union movement and urging that the Government carry the financial responsibility for giving effect to the type of correction considered by the instrument of the court, after a proper investigation, to be warranted.

Above all, I ask the Minister to ensure that his department looks closely, and not merely superficially, at the breaking down of the spirit of understanding and guidance that normally is found in the Industrial Registrar. This relationship will deteriorate if he is to be charged with the responsibility for testing every attempt by a disgruntled group of people to take control of an organization that is lawfully registered. After all, registration carries responsibility under various acts. The step that we have suggested will have to be taken in the near future. In difficult times, particularly, whatever the political flavour of the Government in office, the leadership of the trade union movement is required to assist in national affairs. Small groups, for miserable political purposes, are taking advantage of situations that arise, and of this Government’s legislation, to weaken and destroy the type of trade union leadership that is so essential for the welfare of the community at large.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– I just want to comment briefly on a few aspects of the topic that was introduced by the honorable member for East Sydney (Mr. Ward), and to which the honorable member for Mackellar (Mr. Wentworth) and the honorable member for Blaxland (Mr. E. James Harrison) have already addressed themselves.

Mr Duthie:

– Do not make it political.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– It is difficult to avoid1 the temptation to do that, in view of the comment that has come from honorable members opposite. I do not intend to make a political speech about the policy of a court-controlled ballot being available to any union in which a percentage of its members, sufficient to meet the requirements of the legislation, has petitioned for such a ballot. The policy issue involved in that has been thrashed out in this Parliament on more than one occasion. The legislation has been in operation now for several years. The Government has on at least two occasions since that time faced the electors, and can fairly claim, I believe, that this legislation has been endorsed by the Australian electorate.

Honorable gentlemen opposite have made a general criticism of court-controlled ballots as such. I have no doubt in my own mind that this provision, far from strengthening the influence of communism inside the trade unions, has been a most valuable weapon in checking the influence of Communists in the trade unions. That applies not only to those unions where, as a result of an election conducted in this manner, there has been a replacement of Communist officials by officials more faithfully representing the choice of the rank a::d file of the union; perhaps even more potent is the knowledge in the minds of Communist trade union officials that, if they allow their conduct of union affairs, or the policies to which they are giving effect, to get too far out of line with what the rank and file would wish to see, this course is available to the rank and file to replace the officials. I myself have regarded that as one of the most important contributions that the legislation has provided to industrial stability in this country.

However, it is not necessary, I believe, to canvass that phase at any length. I am quite confident in my belief that, whatever may be the view of some honorable gentlemen opposite, or some of the trade union officials who attack our legislation, it is valued by the overwhelming majority of the rank and file trade unionists of Australia and that it has received the overwhelming support of the people.

I have not yet had1 an opportunity of checking the allegation made by the honorable member for East Sydney and the honorable member for Blaxland that in the operation of the system some malpractices have occurred. To the extent that they have been specific in their charges, I shall have the charges promptly investigated, and see what remedial action, if any, is required.

I really rose to deal with what seemed to me to be a constructive suggestion, which was supported by the honorable member for Mackellar. I refer to the suggestion that the Government might examine sympathetically the financial charge which is borne by trade unions in which elections of this kind occur. That charge is said to be in excess of that which the unions would have to bear if the election were carried out in the normal manner by the unions themselves.

Certainly, in bringing this legislation forward, it was not our intention to put an additional financial burden on the trade unions. The Government is far from being hostile to Australian trade unionism, as the honorable member for East Sydney so frequently tries to press against us. Trade unionism has flourished during the life of this Government, and the number of trade unionists has increased very significantly. The prestige and influence of trade unionism in Australia has never stood higher than it has during this period, in which the trade unions have enjoyed a marked degree of co-operation with the Government on great industrial questions. So there is nothing to that charge.

But there is some point in what has been said about additional cost. This matter does not come under my notice for the first time as a result of what has been said here. I have been giving some attention to it inside my own department. A reasonable approach would seem to be to examine how far the cost of an election conducted under the auspices of the court would exceed the cost of an election conducted in the normal manner by the trade union. It would be quite unreasonable, I suggest, to expect the body of Australian taxpayers to finance union elections in toto, but to the extent that, as a result of direct Government policy, the trade union elections are costing more than would otherwise be the case, there may be substance in the claim that the difference could be a legitimate claim upon the general revenues of the Commonwealth. That has been examined by my department. At this point, I cannot say that any final conclusion has been reached, because the matter is one of some complexity, owing to the varying methods under which union elections are conducted. For example, a very big, influential, and powerful union, the Amalgamated Engineering Union, conducts its elections under a system of what are known as star nights, and only the members present at the meeting on the star night, as I understand the position, are eligible to record a vote for such office or offices as are being balloted for at that time. On the face of it, that would represent only a small percentage of the total union membership and it is reasonable to assume that an election in which ballot-papers go to all members of the union might be a very much more costly affair.

Other methods are adopted by other unions. I am not in a position to go into the details of them to-night; I merely mention that to indicate that it is a matter of some complexity. However, we are pursuing, not unsympathetically, our examination of it. When the Department of Labour and National Service is able to bring it to the Government, it becomes a matter of Government policy, on which my colleagues would have to express their views, and Treasury implications would have to be examined before a decision could be given. But I mention, in reply to what has been said by honorable gentlemen in the course of this debate that we have not been unmindful of the problem. I shall certainly see that what they have said in this particular aspect is not overlooked.

Mr CLAREY:
Bendigo

.- Now that this question of union ballots has been raised and the Minister for Labour and National Service (Mr. Harold Holt) has expressed some views on it, I believe it is desirable that a little further discussion should take place on this matter. One of the things I should like the Minister to bear in mind when consideration is being given to meeting costs, is the wide diversity in union rules concerning the election of officers. It is also well to bear in mind that, in my long association with the trade union movement, I have never known any time when there has not been an internal struggle within the trade unions on leadership and the control of a union or a branch. Because that struggle has always been there - sometimes very intense and at other times not quite so hard - wrong impressions have been given of what is taking place in the trade union movement concerning the election of officers.

I want to say quite frankly that the most satisfactory and most successful of all legislation that has been introduced to safeguard the interests of members when trade union elections are taking place was that which was introduced by Mr. Chifley when he led a Labour government in 1948. At that time I was president of the Australian Council of Trade Unions. That body was very gravely concerned and acted on behalf of the trade union movement in regard to certain ballots which had taken place. It was clear that malpractices and things contrary to both the spirit and the desire of the trade unions were occurring. Mr. Monk, Mr. Croft, Mr. King of Sydney and I conferred with Mr. Chifley on this matter. As a result, legislation was introduced in 1948 which contained two provisions. The first was this: Where a bona fide case could be made out to indicate that irregularities had taken place in connexion with any trade union election, it was open to the court to decide that a new election should be held. The second provision, and a most important one which was overlooked in later legislation was this: Any expenses incurred by those who had raised the question and desired to have irregularities checked and corrected were to be met by the Commonwealth. That enabled persons humble in life with no financial backing to have a wrong righted. It was a very proper provision.

It was in consequence of that legislation that one matter to which the Minister has referred was corrected. The defeat of the Communist leadership in the Federated Ironworkers Association was the result of the 1948 amendment of the act. Similarly, the defeat of the Communist influence in the Federated Clerks Union also was the result of irregularities and subsequent action in connexion with them under that legislation. It is apparent, therefore, that the most important changes that have been made in union leadership have been the consequence of an act that was designed to check irregularities. Where irregularities did take place, the union was given an opportunity to determine exactly what should be done by means of a fresh ballot.

The Minister for Labour and National Service has said that there have been two elections since certain amendments were made to the act, and that, therefore, it may be regarded as having been endorsed by the people. I think that is a wrong approach to a question of this sort. When the legislation was first introduced in its present form by this Government, it was more in the nature of an experiment than anything else. From the trade unions’ point of view, the legislation was launching them on an uncharted sea. One has to study the effect of the legislation in order to ascertain whether it has served its purpose or not.

One of the things that has very gravely disturbed me in connexion with the ballots conducted by the court is the fact that, while the organization itself is compelled to carry out to the letter the rules as registered in the court when it is conducting a ballot, the officer who controls the courtcontrolled ballot can depart from the union rules to any extent he likes, and can make new rules and regulations concerning the control of the ballot. That is quite wrong. If it is the intention of the Government to ensure that union members can express opinions in accordance with the rules that they themselves have adopted, it should be the duty of the officer who is conducting a ballot to abide by and carry out the rules just as thoroughly and conscientiously as do the union officers.

To a very large extent, the increased expense that the unions are called upon to bear is the result of departure from their own rules by the Commonwealth court which, as a consequence of the legislation, is thrust into the administrative control of what are essentially trade union matters. So, in a very large measure, the increase in the costs is due to legislation which was passed by the Parliament, but no honorable member, whether he voted for the measure or against it, had the slightest idea at the time that such would be the result.

In trade unions, the method of electing officers varies considerably according to the type of union and the size of its membership. Small organizations like the Brushmakers Union of Victoria with 200 or 300 members hold a general meeting to which members are summoned. There may be 90, 100 or 150 present. A ballot is conducted in the room, the returning officer being appointed by the members and the scrutineers being selected from the floor of the meeting. The votes are counted and in that way the members determine what shall be done. The Amalgamated Engineering Union, with an organization throughout Australia, follows a course that was first developed by the trade union movement in Great Britain. That is the formation into branches of members living in geographical areas. In each State and region, a district committee has entire control. In turn, the regional or district committee is subject to the rule of the Commonwealth Council. On election night the members of the union in Prahran who are members of the Prahran branch and the members of the union in Armadale who are members of the Prahran branch are summoned to the general meeting and receive ballot-papers. I am subject to correction in what I am about to say, but I believe that I am right in saying that members who are unable to attend the meeting may make application for postal ballotpapers in order to enable them to exercise their vote. So far as the Amalgamated Engineering Union is concerned, this system has proved, in its operation both in England and Australia over a period of 100 years entirely and eminently satisfactory for the election of the various officers for the ensuing twelve months or, in the case of the Commonwealth Council of the union, for the ensuing three years. It works satisfactorily; but when an election goes to the Commonwealth Arbitration Court to be the subject of a court-controlled ballot it ceases to be a question of carrying out the rules of the union and having a postal ballot because there is no provision for such a ballot in the rules of the court. I think that that is wrong. I think it is entirely wrong, for the court to say that union rules must be carried out in ordinary elections, and when the court itself takes control of .a ballot it does the reverse, and members of the organization concerned are compelled to accept the position.

These are all things in connexion with ballots which ought to be looked at. I can remember my good friend the honorable member for East Sydney (Mr. Ward) raising last year an instance in which there seemed to be a probability that in New South Wales employers were combining with dissident elements in a union to influence the election of officers. That was one thing that was never contemplated when the original legislation was being passed through the Parliament. It was never thought that there would be instances of employers combining with one group in a union which was struggling against some other group in the union for the purpose of influencing an election of officers. That is entirely wrong.

My good friend, the honorable member for Blaxland (Mr. E. James Harrison), mentioned the relations between the Industrial Registrar and the trade unions. I think there have been only three Industrial Registrars since the original Commonwealth Conciliation and Arbitration Act was passed in 1904. The first was Mr. A. M. Stewart, now dead, who gave wonderful service, brilliant services to the court. He was followed by an equally brilliant man, Mr. Murray Stewart, who subsequently became a conciliation commissioner. The present registrar, for whom I have a high regard and who, I believe, is carrying out the duties of his office in an extremely satisfactory manner, is Mr. Ed Taylor.

It is essential that the office of Industrial Registrar be held by a man who has the confidence both of the employers and the employees. He is the administrator of the registry. He has to see that the rules of organizations are carried out. He has to administer a large staff. He is called upon to give rulings in respect of all sorts of things, including the interpretation to both employers and employees of the rules of procedure of the court. The right man occupying that position can considerably facilitate the functioning of the Commonwealth Arbitration Court.

I agree with the honorable member for Blaxland that it is undesirable to overload the Industrial Registrar with duties that do not permit him to carry on the functions of his office in a manner that enables him to smooth relations between employers and employees. I can only speak in the very highest terms of the manner in which the three registrars, including the present registrar, carried out their duties.

I want to say finally that I believe it is desirable that the whole question of courtcontrolled trade union ballots should be reviewed. I know that recently, in my own trade union, we were having some difficulty between two divisions of the union in Tasmania. I happened to be federal president of this trade union. The federal council of the union decided that there would be an election of officers. The northern division of the union in Tasmania desired to have the election court-controlled. The federal council felt that it would be a good idea, because we expected that the southern division of the union would endeavour to upset an ordinary ballot. The northern division circulated a petition which went before the Industrial Registrar, but it did not comply with the provisions of the act, so a courtcontrolled ballot was refused. We then had a ballot controlled by the general secretary of our organization, and, as we expected, the southern branch saw to it that irregularities took place, and went to the court, after which a court-controlled ballot was held. You have difficulties of that description when you have disputing groups in a union, and it becomes extremely difficult for the federal council of the union to exercise the control it desires. I believe that what is necessary is an amendment of the act to give the fullest possible power to the federal council of an organization in order that it may, without meeting such difficulties as are caused by frivolous petitions, administer the rules of the union.

Mr WHITLAM:
Werriwa

.- In the course of this debate on the Estimates for the Attorney-General’s Department I wish to suggest some judicial reforms for the consideration of the Attorney-General (Senator O’sullivan), whom I have found over the last year and a half to be receptive to the idea of constitutional reform in many respects. I submit these suggestions also for the consideration of whoever may be the Attorney-General in a few months time.

My suggestions involve the application by this Parliament of some of its powers under sections 74, 75, 76 and 77 of the Constitution. They are, first, that we should abolish appeals to the Privy Council in constitutional matters, thus making the High Court supreme in such matters; secondly, that we should set up some federal court of the status of the State Supreme Courts, with three objects - to free the High Court from lesser matters, to give a lead in law reform throughout the continent, and to co-ordinate Commonwealth administrative law.

The first suggestion would involve the passage by this Parliament of a law limiting the matters in which the Privy Council may give leave to appeal from a decision of the High Court, at least to matters which concern the powers of the Commonwealth Parliament and State parliaments, if not to matters which concern the interpretation of laws or the rights of citizens between themselves.

At the time of federation it was thought that the determination of constitutional matters was effectively reserved to the High Court by requiring a certificate from that court before an appeal could go to the Privy Council on any question as to the limits inter se of the constitutional powers of the Commonwealth and those of any State or States, or as to the limits inter se of the constitutional powers of any two or more States. The Privy Council, however, has ruled that section 92 does not concern the limits of the powers inter se of the Commonwealth and the States, and will hear appeals in connexion with section 92 matters without a certificate having been granted by the High Court. We know that most constitutional questions which have arisen in Australia in recent years have concerned the operation of section 92. Such matters are now being decided by the Privy Council and not by the High Court. That is a loophole which was not envisaged by the founding fathers and which can be closed by the action of this Parliament. I believe the intention of the founding fathers would be re-asserted if the Parliament were to say that at least in constitutional matters the High Court should remain the final arbiter.

The next suggestion that I make is for the establishment of a federal supreme court, somewhat on the lines of the United States Circuit Courts of Appeal. You will remember, Sir, that section 75 (iii) and (iv) of the Constitution provides that the High Court shall have original jurisdiction in all matters - (iii.) In which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party: and (iv.) Between States, or between residents of different States, or between a State and a resident of another State.

Section 76 of the Constitution reads -

The Parliament may make laws conferring original jurisdiction on the High Court in any matter - (i.) Arising under this Constitution, or involving its interpretation: (ii.) Arising under any laws made by the Parliament: (iii.) . . .

Relating to the same subject-matter claimed under the laws of different States.

Section 77 of the Constitution provides -

With respect to any of th>e matters mentioned in the last two sections the Parliament may make laws - (i.) Defining the jurisdiction of any federal court other than the High Court: iii.) Defining the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to or is invested in the courts of the States . . .

Under section 77 of the Constitute t v,c cannot preclude the High Court from hearing matters in which it has original jurisdiction or in which it can be given original jurisdicton. I am merely suggesting that we should set up a federal supreme court in which litigants could bring many matters which at present must go to the High Court. My first objective in suggesting such a court is to free the High Court from hearing lesser matters. To illustrate my point, appeals from the judges who exercise jurisdiction under the Bankruptcy Act 1924- 1950, or from the judges who would exercise jurisdiction under the provisions of the Matrimonial Bill introduced last year by the honorable member for Balaclava (Mr. Joske), or from the judges of the Supreme Courts of the Australian Capital Territory, the Northern Territory and, I believe, of Papua and New Guinea, lie to the High Court, and the High Court alone. On the other hand, appeals from judges exercising a comparable jurisdiction in each State lie to the Full Court of the Supreme Court of the State. 1 think the High Court would be glad to be rid of these lesser matters, if 1 may so describe them with respect, which ordinarily would be heard by the full court of a court of supreme court status.

Such a federal supreme court would also give a lead in nation-wide law reform. On 18th July, 1957, Sir Owen Dixon, Chief Justice of Australia, a man who is formidable in every juristic and academic sense, made this statement to the Tenth Legal Convention of the Australian Law Council -

Is it not possible to place law reform on an Australia-wide basis? Might not there be a Federal Committee for Law Reform? In spite of the absence of constitutional power to enact the reforms as law, it is open to the federal legislature to authorize the formation of a body for inquiry into law reform. Such a body might prepare and promulgate draft reforms which would merely await adoption. In all or nearly ail matters of private law there is no geographical reason why the law should be different in any part of Australia. Local conditions have nothing to do with it. Is it not unworthy of Australia as a nation to have varying laws affecting the relations between man and man? ls it beyond us to make some attempt to obtain a uniform system of private law in Australia? The Law Council can, of course, do much. But it is a voluntary association and, without a governmental status and the resources which that will give, a reforming body will accomplish no great reforms.

This Parliament has the power to give a lead in law reform under sections 75, 76 and 77 of the Constitution, to which I have referred. This Parliament could implement a uniform code throughout Australia in matters in which the Commonwealth was one litigant and a private citizen or a State the other; or in matters in which two States were litigants; or in matters in which residents of different States were litigants; or in matters in which a State and a resident of another State were litigants; or in matters which arose under any laws made by this Parliament; or in matters in which claims are made under the laws of different States. This Parliament could provide the machinery for those cases to come before the federal court and, if it saw fit, could preclude them from coming before State courts.

The Parliament could in this way eliminate a great number of the irritating differences between the laws of the States which at present make litigation between governments and citizens unnecessarily protracted and expensive. We have the means at hand - we should adopt them.

The court could be a commercial court for the whole of Australia. It would be desirable to provide a better legal code under section 51 (xvi.) and (xvii.) of the Constitution in respect of bills of exchange, copyrights, patents and trade marks. I would suggest simple constitutional reforms, which would have no political objections, to give the Commonwealth jurisdiction over companies and matters of succession. It is foolish that companies should have to be registered in each of the States and territories in which they carry on business, and that an executor should have to reseal a probate in every State or territory where a company resides in which the testator held shares. That system causes delay and expense to citizens, and the only people who profit from it are in the lower branch of the legal profession.

The court might also deal with matters of status and domestic law. The jurisdiction of the present bankruptcy court could be merged with the proposed new court, together with the jurisdiction envisaged in the matrimonial legislation introduced by the honorable member for Balaclava. By simple constitutional reforms the Commonwealth Parliament might be given power to determine matters of lunacy and custody of infants born out of wedlock which involve uncertainty, expense and delay. I have in mind the Mace case in New South Wales. In these distressing cases three justices of the High Court have given three conflicting decisions on which State law applies. Any future occurrence of that kind could be prevented if this Parliament obtained the power to invest jurisdiction in such matters in an appropriate court.

I come, finally, to the suggestion that this court which I envisage would be an appropriate body to co-ordinate Commonwealth administrative law. I only have to refer to an answer which the Prime Minister (Mr. Menzies) gave to me on 14th May to show how complicated and variegated are appeals on Commonwealth administrative matters. I asked the right honorable gentleman -

Under what statutes have (a) boards, tribunals and committees been established and (b) courts been empowered to hear appeals from the decisions of Commonwealth departments and instrumentalities?

The Prime Minister listed 45 acts. He listed 94 boards, tribunals, committees and courts, which determine appeals under different sections of those 45 acts. There were, in fact, 50 different boards, tribunals, committees and courts hearing appeals from administrative decisions under Commonwealth acts of Parliament. I do not wish to go into the considerable literature and jurisprudence on the subject of appeals from administrative bodies. I do suggest, however, that the Commonwealth should give the lead to governments in Australia by providing some form of judicial procedure whereby, if appeals are to be heard from administrative decisions, they can be heard in an appropriate fashion.

The TEMPORARY CHAIRMAN:

Order! The honorable member’s time has expired.

Mr WHITLAM:

– With the consent of the committee I shall take my second period now.

May I illustrate the different appeal boards which are cited in the Prime Minister’s reply to me? There are separate appeal boards under the Public Service, Commonwealth Railways, Overseas Telecommunications, Broadcasting and Television, and Commonwealth Bank Acts, although each of those boards has to decide matters which are of the same character. The court which I envisage would hear all such appeals by analogy with the New South Wales Crown Employees’ Appeals Board, whose chairman is a judge of supreme court status.

Specific bodies are mentioned in the Prime Minister’s reply such as the Taxation Boards of Review, the War Pensions Entitlement and Assessment Appeal Tribunals and the Courts Martial Appeal Tribunals, all of which carry out judicial functions and all of whose functions might well be merged in such a court as I have envisaged.

There are several acts under which there are appeals from Commonwealth administrative decisions which the Prime Minister had not mentioned. One act which occurs to me is the National Health Act, under which appeals go to the Supreme Court of the relevant State. I suggest that these would be appropriate matters to go before a federal Supreme Court since they arise under a federal act.

Two further judicial functions might be fulfilled by the court. They are, valuation matters, on the analogy of the New South Wales Land and Valuation Court, which is constituted by a judge of supreme court status, and disputed returns, which at present are the province of the High Court, or, on reference from the High Court, the Supreme Court of the relevant State.

I shall mention three other matters on which, at present, there is no satisfactory form of appeal. If a public servant is dissatisfied with a surcharge imposed by the Auditor-General, his only appeal is by petition to the Governor-General. Secondly, if an applicant for a pension is dissatisfied with the decision of the Department of Social Services, his only recourse is to ask his member to take the matter up with the department or the Minister. Finally, if a public servant is refused promotion to a posting on security grounds, or if an applicant for naturalization is refused naturalization on such grounds, or if nomination of a person for admission to this country is refused on such grounds, there is no appeal, except by asking a member of Parliament to make representations to the appropriate Minister.

In all these administrative matters, other countries such as the United States of America and the United Kingdom provide us with familiar examples of judicial procedures. Such matters as onus, open hearings, representation and costs could easily be settled as they have been settled in those other countries. For the foregoing reasons, I believe that the creation of a federal court of the status of the State Supreme Courts would ensure that the High Court was left free to deal with matters which are of paramount constitutional and legal importance; that there was some co-ordination of law reform in Australia; and that the administrative procedures of the Commonwealth, at least, were standardized and modernized.

Mr WARD:
East Sydney

.- I deliberated with myself as to whether I would speak to the vote of the AttorneyGeneral’s Department on a second occasion. When I glance at the Government side and see the dejected and despondent crew that at present occupies those benches, I am reminded that after 22nd November a new government, a Labour government, will be taking office, and that all these matters that we are now raising will be matters that we can adjust ourselves within a few weeks. But I have decided to say a few words, merely for the sake of keeping the record straight.

I want to correct immediately a wrong impression that may have been created by the honorable member for Bendigo (Mr. Clarey) when he said that he thought that a review of court-controlled ballots was long overdue. I know the honorable member’s opinion on these matters and I know the policy of the Australian Council of Trade

Unions. What we want when we talk about a review of court-controlled ballots is not a review of the court-controlled ballots conducted under the Menzies-Fadden legislation, for our policy is to repeal that legislation. We want a review of the courtcontrolled ballot system provided for in the Chifley Labour Government’s legislation. In relation to what was said earlier about malpractice, I want to make it clear to the Parliament that there is evidence of malpractice in some of the court-controlled ballots. Let me give one or two illustrations.

When a ballot was being conducted for the clerks union in New South Wales, the envelopes in which the ballot-papers were sent out and the envelopes which contained the propaganda of what were known as the “ Groupers “, who were running a ticket in the election, were addressed on the same typewriter and went out in the same mail. This shows that there was complete collaboration between those who conducted the ballot and people who were interested in the result of it. I think that this was completely improper and shows that these ballots have not been conducted in the impartial method that some people would have one believe.

The Sydney branch of the boilermakers union had a court-controlled ballot. Some months after the ballot was concluded and the poll was declared, in a strong room at Haymarket Post Office in Sydney was discovered a bag containing 600 returned ballot-papers which had never been counted and had never been taken into account by those who conducted the poll.

A case was mentioned by the honorable member for Bendigo in which employers interested themselves in a court-controlled ballot in respect of the Operative Painters and Decorators Union in New South Wales. This union was able to establish beyond doubt, with a number of statutory declarations, that the petition had actually been taken around by the foremen on the job - the master painters’ representatives - for signing. The petitions had been typed and prepared in the office of the master painters association. That seems to me to indicate pretty clearly the type of malpractice encountered in ballots that are declared to be court-controlled and, according to members of the Government, beyond all question.

We have often had the policy of the Australian Council of Trade Unions quoted to us in this Parliament. The A.C.T.U. has declared its policy to be the repeal of the Menzies-Fadden legislation and a return to the conditions which applied under the Chifley legislation of 1948. I do not propose to say any more about the ballots. I merely wished to show that the idea that all ballots conducted by the court under this Government’s legislation are completely honest and conducted in an impartial way will not bear examination. The trade unions of this country are fully aware of the situation. The Minister for Labour anc National Service (Mr. Harold Holt) said that the great majority of trade unionists support this legislation. That is utter rubbish. Possibly the majority of trade unionists would accept the principle that some action should be taken when there is evidence of malpractice in a trade union ballot, but I am perfectly certain that if the trade unionists had an opportunity of voting specifically on the Menzies-Fadden legislation they would reject it overwhelmingly. They do not want it.

There are a couple of matters that I think require some mention and some answer by the Government. I notice that under the proposed vote for the Attorney-General’s Department we can deal with the Commonwealth Reporting Staff. Recently in Tasmania a case was commenced - the proceedings are still under way - known as the Hursey case. I do not propose to say anything about that case, because it is still before the court, but I do propose to ask a question about the Commonwealth Reporting Staff.

Mr HAROLD HOLT:
HIGGINS, VICTORIA · LP

– That question has already been asked and answered.

Mr WARD:

– This case is before a State court. I want to know why Commonwealth court reporters are in Tasmania reporting the proceedings. It appears to me that the Government is taking an undue interest in this case and is watching it very carefully. What is the Government’s interest in it? The Government is being partisan in this matter. It is doing its best to assist one side in the argument that is now being determined in the court.

There is one other matter to which I want to direct the Minister’s attention. In this country it has been the practice that if a person has a penalty imposed upon him, and it is eventually proved that the court which imposed the penalty had no jurisdiction in that particular field, he shall have refunded to him the amount of the penalty which was illegally imposed. If it is a taxation case, the person has a claim for a refund. Under the penal provisions in the Government’s legislation, savage penalties can be imposed on trade unions, involving considerable sums of money. The boilermakers union appealed against such a penalty and took the case to the Privy Council. The Privy Council declared that the court in this country which imposed the penalty - what was known as the Commonwealth Arbitration Court - had no authority to impose such a penalty. The Privy Council reversed the court’s decision.

What happened about the fines? If wheat-growers or road hauliers had been involved, we would have had honorable member after honorable member on the Government side getting up, asking questions and demanding that the penalties be refunded. This union had a savage penalty imposed upon it, but every endeavour that has been made to get the Government to grant a refund of the money has so far proved to be unsuccessful. Every time we ask the Minister a question he tells us that the matter is under consideration. It has now been under consideration for a very long time. It is about time that the Minister made up his mind and decided to refund these moneys to the trade union. This is a Minister who says, “ We are not opposed to trade unionism. Trade unions have flourished under this Government during its term of office “. The attitude of the Government in this matter does not indicate that it is favorably disposed towards trade unions. It should have been a matter only of days - certainly not of weeks - before the union had refunded to it every penny of the savage penalty that was imposed. Why should not its money be refunded? The Privy Council, which is accepted at the moment as the highest authority in these matters, has declared that the court which imposed the penalty had no power to do so and, therefore, that the penalty was imposed illegally upon the union. Let the Minister say without equivocation what the Government intends to do in respect of this matter, without backing and filling or saying that the matter is under consideration.

We want some action taken. Even though this is a dying government,I hope that in the last few weeks of its life it will take corrective action along the lines I have suggested.

Proposed vote agreed to.

Progress reported.

page 840

ADJOURNMENT

Repatriation - Import Licensing

Motion (by Mr. Harold Holt) proposed -

That the House do now adjourn.

Mr WARD:
East Sydney

.- I have a couple of matters which I regard as being of great importance that I wish to bring to the notice of the House. One of them concerns a repatriation case. I have repeatedly raised matters in this Parliament concerning the Repatriation Department, and I think it will be agreed that on every occasion there has been some substance in the case that I presented. I believe that the Government is now setting out on an economy drive in the Repatriation Department, and, in fact, in other departments as well. I do not blame the Repatriation officials, because they probably are acting under instructions from the Government. The Government’s method of economizing in the Repatriation Department is to cut down on benefits to ex-servicemen. I have a case here which seems to illustrate that. I shall not mention the ex-serviceman’s name at this moment, because I have already given it to the Minister and I am still waiting for some advice on the case. It is two months since I raised the matter with the Minister for Repatriation, and I think that when honorable members hear the circumstances of the case they will agree that two months has given the Minister adequate time in which to make a decision. I refrained from raising the matter previously, because I was giving the Minister time to deal with it.

The man concerned is an ex-serviceman of the first world war. He was discharged in 1918 and shortly after his discharge he obtained a war pension for war-caused disabilities. As the years went on his disabilities became worse, and in 1950, his pension was increased to the amount paid to a totally and permanently incapacitated ex-serviceman. Every member of this

Parliament is fully aware that before a pension for total and permanent incapacity is granted, the applicant must be suffering from war disabilities to a major degree. This man received his total and permanent incapacity pension until this year - 1958. He has now received this communication -

Following a recent review of your case, the matter of assessment of your pension has been carefully considered and, in view of the medical evidence that your condition has improved to such an extent as to permit you to engage in remunerative employment, a reduction in the rate of your pension is indicated.

This man has now reached the age of 65 years. He has been on a pension for almost the whole of the period since he was discharged after the first world war and he has been receiving the total and permanent incapacity pension for just on eight years. Now, although he is 65 years of age, the Repatriation Department doctors declare that he is in a condition to undertake remunerative employment. At 65 years of age, the Commonwealth Department of Labour and National Service will not register him for employment. If he goes to the department he will be told to apply for the age pension.

I have seen this man personally, and I would be prepared to bring him to Canberra if honorable members wanted to see the unfortunate chap. I guarantee that not one honorable member on either side of the House would say that he was fit to undertake remunerative employment. He is a very sick ex-serviceman, but as a result of this decision his pension has been reduced from £22 a fortnight to £15 15s. He is now on what is termed the 100 per cent. general war pension, but it means a reduction of his income. The final paragraph of this letter reads -

Before any reduction is effected, you will be medically examined and if the improvement in your condition is maintained, your pension will be reduced to the rate applicable to your condition.

He was given a few months in which to obtain employment. How could he get employment at 65 years of age, having been eight years on a pension for total and permanent incapacity and not even allowed to register with the Commonwealth Employment Service? I think this is an outrageous decision. thought that probably some error had been made by an inexperienced officer dealing with the case andI handed the matter to the Minister in the belief that it would be corrected very quickly. But two months have gone by, and all that I have been able to ascertain from the Repatriation Department is that an ex-serviceman has the right of appeal to the assessment tribunal. All that I can get from the Minister is the statement that inquiries are still proceeding in this case.

The unfortunate ex-serviceman is very worried and distressed over the decision of the Repatriation Department. The Minister himself should take action to correct an obvious and grave anomaly in this case.

I want to mention one other matter. I do not suggest that import restrictions are not necessary at different times in the economic history of the country and I do not propose to deal with that phase of the matter. I do think, however, that it is about time that some examination was made of the whole field of import licensing to find out whether it is practicable to eliminate many of the vexatious forms which applicants for an import licence have to fill in.

I understand that an army of officers in the department is employed to churn out these forms, which are incomprehensible to the ordinary member of the community, or to write voluminous correspondence. The unfortunate people who go to the department and apply for import licences are, in many cases, driven almost to distraction. I want to read to the House portion of some correspondence which was sent to an applicant for an import licence. The gentleman concerned does not want his name mentioned because, he says, as an importer he would be exposed to victimization. If any honorable member could find some sense in this document, he would have no difficulty in obtaining an honours pass at any examination in mathematics conducted in this country.

This is what it says -

page 841

L.I.-

[ do not know what that means. Probably is is a departmental reference. -

L.I. 58/20 Adjustment for above average expansion of sales.

I refer to the application form submitted by you to the Collector of Customs in accordance with the above instruction.

It is regretted that there has been a delay in finalising the adjustment but a careful examination of all the forms submitted has been necessary.

This examination indicated that to confine the total cost of the adjustment to the available exchange it would be necessary to make major modifications to the plan followed last year or to use a basis which gave licences to only a few firms.

The system outlined below which contains modifications to that followed last year, was adopted.

The effect of this system is to give licences to as many importers as is consistent with the fundamental idea of an adjustment based on better than average sales.

Formula to be applied:

Step 1

Calculate the theoretical percentage of sales as follows -

Take 42 p.c. of 1950/51 Category B imports (i.e. the effective level under L.I. 57/54 for B. Category imports) as a percentage of 125 p.c. of 1952 sales, (i.e. 1952 sales plus 25 p.c. of the average increase in sales).

Step 2

Apply this percentage to actual 1957 sales.

Step 3

Deduct current quotas in Category B and bank C.16 from this figure.

The remainder is the annual result which the importer receives subject to the modifications below.

Modification 1

No importer may receive licences to more than 20 p.c. per annum of his Category B imports in 1950/51. (Category B as now defined.)

Modification 2

Importers whose sales in 1952 were less than 100 p.c. of their Category B imports in 1950/51 may not receive licences worth more than 20 p.c. of their current quota (B and Bank C.16). [Extension of time granted.]

Modification 3

Traders who held B (2) manufacturing quotas at 31.12.56 which were less than 50 p.c. of their total Category B quotas, i.e. firms eligible under paras. 4 and 5 L.I. 1957/104 may be dealt with by modifying Step 3.

Instead of deducting current quotas in these cases they should sustain a deduction of current quotas, reduced by the current value of B (2) manufacturing quota as at 31.12.56.

In your case this formula may be expressed. Steps 1 and 2 -

Step 3

Subtract B and Bank C. 16 quotas - £ As this result is negative I must advise that no licence may be issued under L.I. 1958/20.

There is no need for me to make any further comment. That letter illustrates the absurdity of the present situation. Surely there could be a more simple process to determine the applications of people who have to approach the department.

I ask the appropriate Minister whether, when we consider the estimates for the Department of Trade, he will offer some explanation as to how these formulas are worked out, how they are applied, and how the people concerned may get somebody to explain exactly what they mean.

Mr CHANEY:
Perth

.- I do not want to delay the House for more than a couple of minutes, but I do not think that one remark made by the honorable member for East Sydney (Mr. Ward) should go unchallenged. He said it seemed that the Repatriation Department had embarked upon an economy drive, which was resulting in men’s pensions being reduced. That is a slur on the Minister for Repatriation (Senator Cooper), who I believe is the most sympathetic Minister for Repatriation that any government has had since the repatriation scheme was introduced. I do not think the honorable member for East Sydney would be any great judge of whether or not a man was entitled to a T.P.I, pension.

Mr Duthie:

– We have a fair idea.

Mr CHANEY:

– He probably gets a bit of practice by looking at some of you. Decisions in regard to disability are made by a panel of medical men, they being best suited to say what a man’s medical condition is. A decision having been made, the ex-serviceman concerned has recourse to certain tribunals. If honorable members do not agree with the present system, what do they suggest should be substituted in its place? If the system that has been fought for by ex-servicemen were to be abolished and if it were to be replaced by a system under which a Minister or a departmental officer has the say, I venture to state that honorable members would be plagued by inquiries and complaints in their electorates to a greater degree than they would appreciate, and that most of them would be willing to return to the present system.

Regardless of whether or not a man is entitled to a T.P.I, pension, the machinery is there for him to appeal and for his appeal to be taken from one tribunal to another. I resent the inference that the Repatriation Department has instituted an economy drive and that it is saving money by reducing ex-servicemen’s pensions. I believe that the average ex-servicemen in Australia realizes that the department is acting in his very best interests.

Mr POLLARD:
Lalor

.- I rise only to say a few words about an impression that the honorable member for Perth (Mr. Chaney) may have conveyed - that is, that it was futile for members of the Parliament to take up repatriation cases.

Mr Hasluck:

– He did not say that.

Mr POLLARD:

– That is the impression he conveyed. When the honorable member for Perth informs the Parliament, in effect, that the medical officers of the Repatriation Department, all the various tribunals associated with it, and finally the Minister for Repatriation have the last word - that was the impression he conveyed - he is doing an injustice, not only to the people whom he puts in that light, but also to the exservicemen with whom the department deals from time to time.

I probably have as much respect for the officers of the department, the various repatriation tribunals and the Minister for Repatriation, who is responsible for the political administration of the department, as has any one else; but I know of numerous instances that have occurred since I became a member of the Parliament in which justice was not done to the ex-serviceman concerned until his case was aired on the floor of this House, lt will be a sad and sorry day when any one is allowed to create the impression that there are in this country individuals, whether they be members of parliament or members of tribunals or public authorities, who are so perfect in the carrying out of their duties that it is not necessary from time to time for the Parliament to consider whether they are not what they are represented to be.

Mr SWARTZ:
Darling Downs

– The honorable member for East Sydney (Mr. Ward) referred to a certain matter relating to the import licensing system. He failed to mention the name of the individual involved, so his case has little substance in it. Nevertheless, apparently he and other Opposition members derived a great deal of amusement from it.

Mr Calwell:

– Honorable members on your side of the chamber laughed heartily, too. A good time was had by all.

Mr SWARTZ:

– Be that as it may, I think I should point out that the present system was introduced after very careful discussions with members of the retailers’ association, the various authoritative bodies outside, and the import consultative committee. It was introduced to alleviate hardship. Honorable members opposite may laugh, but I fail to see that it is particularly amusing from the viewpoint of any one whose business is affected.

Many hundreds of importers throughout Australia have been able to understand the ssytem very clearly and have been able to take advantage of it. If the honorable member for East Sydney or any other person has any specific problem, he is quite at liberty to bring up the matter with the Minister for Trade (Mr. McEwen) or with me. I would see that an officer of the department was made available to explain the system. I repeat that, if the honorable member for East Sydney has a particular problem, I shall be only too happy to try to elucidate for him the intricacies of the system.

Question resolved in the affirmative.

House adjourned at 11.58 p.m.

page 843

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Merino Sheep.

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

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

  1. It was reported in September, 1957, that fourteen rams produced from the crossing of imported Australian merino rams with South African ewes had been included in an auction sale of surplus stock at the Grootfontein Research

Station in South Africa. This station is controlled by the department administered by the South African Minister for Agriculture.

  1. Yes.
  2. As I have previously explained to the House, the 1957 sale of progeny resulted from a difference of interpretation of the conditions under which approval was given for the export of the Australian rams to South Africa. This has since been clarified, and the South African Government has given definite assurances that no progeny sired by the Australian rams will be made available to commercial breeders.
  3. It has been stated in answer No. 3 that the difference in opinion as to the interpretation of the conditions has now been clarified. The South African Minister for Agriculture is reported to have said prior to the assurances previously referred to that no formal agreement had been entered into with Australia about the importation of the rams, but that an undertaking had been given by South Africa when the rams were imported.

New Guinea Shipping Subsidy

Mr Galvin:

n asked the Minister for Territories, upon notice -

  1. Is any subsidy paid to Burns Philp and Company Limited in respect of vessels trading between Australia and Papua and New Guinea; if so, how much is this subsidy?
  2. Has the Government directed that all copra cargoes from the Territory to Australia should be carried in vessels owned by Burns Philp and Company Limited?
  3. What amount is paid by this firm and similar companies for the use of wharfs and cargo sheds?
Mr Hasluck:
LP

– The answers to the honorable member’s questions are as follows: - 1 and 2. To retain the vessels “ Bulolo “, “ Malekula “ and “ Malaita “ on the Australian shipping register and operated by Australian crews under Australian conditions, in competition with vessels operating under different conditions, a subsidy at the rate of £100,000 per annum is paid and an assurance has been given that copra for Australian crushers shipped from the Territory of New Guinea would be reserved for shipment by the company’s vessels.

  1. The same rates for wharfage, berthage, storage and port dues are charged to all users of Territory ports. The total revenue collected by the Administration under these headings in 1957-58 was £103,164.

Commonwealth Administrative Building. Toowoomba

Mr Swartz:

z asked the Minister for the Interior, upon notice -

When is it intended to proceed with the erection of a Commonwealth administrative building in Toowoomba, Queensland?

Mr Fairhall:
Minister for the Interior · PATERSON, NEW SOUTH WALES · LP

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

  1. There is a requirement for an administrative building in Toowoomba and Commonwealth land is available, (ii) The construction of the building has been considered, together with the requirements for similar buildings throughout the Commonwealth, but at the present time other projects have priority over Toowoomba.

Native Members of the Forces Benefits Act.

Mr Whitlam:

m asked the Minister representing the Minister for Repatriation, upon notice -

Why has no date yet been proclaimed for the Native Members of the Forces Benefits Act 1957 to come into operation?

Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– My colleague, the Minister for Repatriation, advises -

The Native Members of the Forces Benefits Act will be proclaimed as soon as regulations to be made under it are ready to be proclaimed; these are in the course of preparation.

Health Standards Committees

Mr Whitlam:

m asked the Minister for Health, upon notice -

  1. Has he yet appointed the members of the Biological Products Standards Committee and Therapeutic Substances Standards Committee established under the Therapeutic Substances Regulations notified in the “ Gazette “ on 26th January, 1956?
  2. If not, why has he not appointed them and when will he appoint them?
Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

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

  1. The members of the Biological Products Standards Committee have been appointed. Members of the Therapeutic Substances Standards Committee have not been appointed.
  2. Members of the Therapeutic Substances Standards Committee will be appointed when it is decided to extend control of therapeutic substances to those substances the standards for which are not set out in monographs in the British Pharmacopoeia or the British Pharmaceutical Codex.

Pharmaceutical Benefits Advisory Committee

Mr Whitlam:

m asked the Minister foi Health. upon notice -

  1. On what dates did the Pharmaceutical Benefits Advisory Committee meet in the last financial year?
  2. On what dates were regulations and determinations concerning pharmaceutical benefits published in the “ Gazette “ in the last financial year?
Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

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

  1. 5th July, 1957; 22nd November, 1957; and 21st March, 1958.
  2. Regulations-No. 52 of 1957 on 26th September, 1957; No. 23 of 1958 on 31st March, 1958; and No. 42 of 1958 on 26th June, 1958. Determinations– Section 85: 18th July, 1957, 8th August, 1957, 24th October, 1957, 16th January, 1958, and 17th April, 1958; section 93: 18th July, 1957.
Mr Whitlam:

m asked the Minister for Health-

  1. On what date did the Pharmaceutical Benefits Advisory Committee recommend that the list of pharmaceutical benefits should include the drugs in the statutory rule gazetted on 26th June, 1958?
  2. On what date did he accept the Committee’s recommendations?
  3. On what date were instructions for the preparation of the statutory rule forwarded to the Parliamentary Draftsman?
  4. On what date was the statutory rule received from the Draftsman?
Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

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

  1. 26th May, 1958.
  2. 9th June, 1958.
  3. 9th June, 1958.
  4. 12th June, 1958.

National Health and Medical Research Council

Mr Whitlam:

m asked the Minister for Health, upon notice -

  1. On what subjects has the National Health and Medical Research Council in the last ten years made recommendations which required Commonwealth and State legislation?
  2. What Commonwealth and State acts, regulations and proclamations have resulted from these recommendations?
Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

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

  1. The National Health and Medical Research Council, during the last ten years, has made a number of recommendations requiring Commonwealth and State legislation. These recommendations may be considered as falling into two categories -

    1. Proposals designed to achieve interstate uniformity and involving mainly amendments to regulations or enabling amendments to acts permitting adoption of the recommended regulations. These include the notification of disease, the control of food additives, the setting of food standards, and the adoption of uniform requirements for the labelling and packaging of poisonous substances.
    2. New legislation relating to matters not hitherto subject to acts or regulations and amendments to acts to bring them up to date or to achieve uniformity throughout the Commonwealth. Such include the Radioactive Substances Act, the Therapeutic Substances Act, a model act for the control of Narcotic drugs and new legislation for the registration of births and foetal deaths.

  2. In the first category States have complied by amending their regulations to meet a number of the council’s earlier recommendations. Other recommendations are in process of adoption or under consideration. The council has set up two committees to advise upon food additives and food standards and new recommendations from these committees are received at every session of the council. Recommendations for uniformity of poisons schedules in most States require amendment of the Poisons Act, and the poisons authorities of all but one have agreed to these. In the second category the Radioactive Substances Act and Regulations were drafted as models, and these have been adopted in all States except Victoria. The regulations have not yet been promulgated. To supplement Commonwealth powers under the Therapeutic Substances Act, amendment of the Food and Drug Acts in some States may be necessary to provide certain powers for the licensing of manufacture of therapeutic substances. The Commonwealth has been informed that the governments of the States concerned agree in principle to providing these amendments where necessary. A new method for the registration of births and foetal deaths advocated by the National Health and Medical Research Council involves amendment of certain acts which are not in fact administered by the State health authority, but are administered by State registrars-general, e.g., Registration of Births Act. The desired amendments have already been effected in Tasmania and are understood to be under consideration in the other States. The council submitted its recommendations for the control of narcotic drugs in the form of a model act and regulations. In Tasmania the necessary legislation is in course of preparation, and in other States suitable amendments have been made, or are understood to be in preparation, to conform to the recommendations.

Repatriation

Mr Ward:

d asked the Minister representing the Minister for Repatriation, upon notice -

  1. Are many totally and permanently incapacitated war pensioners who are without any other source of income frequently involved in substantial hospital and medical expenses which are not met by the repatriation authorities?
  2. Are these ex-servicemen given treatment at Commonwealth expense only when the ailment has been accepted as war caused and when they are treated as patients of a repatriation hospital?
  3. Have these pensioners on occasions been compelled to obtain treatment at private or public hospitals, or as in-patients of convalescent homes, and been obliged to make payments which absorb all, or a substantial proportion, of their pension?
  4. If so, what action is proposed or contemplated by the Government to afford relief urgently to these men?
Dr DONALD CAMERON:
OXLEY, QUEENSLAND · LP

– The Minister for Repatriation advises me as follows: -

  1. No.

  2. No. Regulation 66 of the Repatriation Regulations provides - “66. - (1.) Subject to the succeeding provisions of this regulation and to such conditions as the Commission determines, a Deputy Commissioner may provide medical treatment in the form of active remedial treatment in respect of a disease or disabling condition that is not due to war service for a member who is in receipt of a general rate of pension upon total incapacity under the First Schedule to the Act or a rate of pension under the Second Schedule to the Act. (2.) A member who would have been entitled to receive a rate of pension specified in the last preceding sub-regulation if his pension had not been cancelled under section 43 of the Act or the rate of his pension had not been reduced under -

    1. paragraph (c) of the proviso to subsection (1.) of section 24 of the Act;
    2. paragraph (c) of the proviso to subsection (1.) of section 101 of the Act; or
    3. sub-section (6.) of section 107c of the Act, shall, for the purpose of this regulation, be deemed to be in receipt of a rate of pension specified in the last preceding sub-regulation. (3.) A member is not eligible for medical treatment under sub-regulation (1.) of this regulation at the expense of the Department if the disease or disabling condition is -
    4. an infectious or contagious disease;
    5. a chronic or incurable disease requiring treatment in an institution for a prolonged period;
    6. a condition caused by alcoholism or addiction to drugs; or
    7. a disease or disabling condition in respect of which the member -
    1. is eligible under a law of the Commonwealth or of a State or Territory of the Commonwealth for medical treatment at the expense of his employer;
    2. is entitled to medical treatment under a scheme of contract medical attention; or

    3. has recovered or received, or is entitled to recover or receive, the cost of medical treatment by way of damages or compensation from another person. (4.) Where-

    4. medical treatment in respect of a disease or disabling condition that is not due to war service is provided for a member who is not eligible for such medical treatment at the expense of the Department; or
    5. the Commission considers that the circumstances are such that the expense of medical treatment provided for a member under sub-regulation (1.) of this regulation should not be borne by the Department, the amount of the expense of the medical treatment shall, if the Commission so directs, be deemed to be an amount supplied to the member by way of loan and thereupon that amount is repayable to the Department in a lump sum or in such instalments as the Commission, in its discretion, determines.”
  3. In cases corning under (a), (b) or (c) of (3.) of regulation 66, quoted above, the pensioner would be responsible for the cost of treatment unless, of course, the condition was due to war service.
  4. The Government considers that the present provisions of regulation 66 are adequate.

Cite as: Australia, House of Representatives, Debates, 27 August 1958, viewed 22 October 2017, <http://historichansard.net/hofreps/1958/19580827_reps_22_hor20/>.

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