23rd Parliament · 3rd Session
The PRESIDENT (Senator the Hon. Sir Alister McMuIlin) took the chair at 3 p.m., and read prayers.
page 711
– I direct a question to the Minister for Civil Aviation. It refers to the announcement that the full court of the Supreme Court of Queensland has quashed the conviction of a man by the name, 1 think, of Hildebrand, for a very serious attempt to cause death, and also damage to an aircraft. I understand that the conviction was quashed, not on the merits of the case, but on a jurisdictional question, because it had not been proved that the offence occurred in Queensland. It would appear that it occurred in New South Wales. 1 ask the Minister: Does the Commonwealth law for the protection of passengers and property being carried by aircraft provide the basis for a proper adjudication of offences? If not, are representations being made to invoke New South Wales law with a view to ensuring that the person concerned will not escape justice because of a purely jurisdictional point involving State boundaries?
– This matter is already receiving the attention of the Attorney-General’s Department. I shall confer with the Acting Attorney-General and see whether I can make available to Senator Wright at an early date a considered answer to his question.
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– Having regard to the visit of the Minister for Repatriation to the Repatriation General Hospital at Springbank, South Australia, can the Minister who represents him in this chamber say whether provision for the erection of a new psychiatric ward at the hospital will be included in the forthcoming estimates of work to be carried out in 1961-62?
– I ask the honorable senator to place his question on the notice-paper. I have discussed this matter with my colleague since his visit to Springbank, and I have the impression that he will look most sympathetically at it.
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– I address a question to the Minister representing the Minister for Shipping and Transport. It relates to a statement - which I was surprised to see published yesterday in so responsible a journal as the Melbourne “ Age “ - to the effect that transport costs in Australia amount to 30 per cent, of either the national income or the gross national product, and that that compares unfavorably with the American figure, which was stated to be 9 per cent, or 10 per cent. Is the statement that transport costs in Australia account for 30 per cent, of the national income or gross national product, completely fallacious? If it is, will the Minister do his best, with determination, to scotch this erroneous impression, which is becoming so prevalent?
– I thank the honorable senator for bringing this matter to my notice. It is a regrettable fact that this fallacious statement has not already been scotched. A very comprehensive analysis of this matter was made at least two years ago by the economic committee of the Australian Transport Advisory Council. That committee produced a paper in which it was shown that the basis of the figure of 30 per cent, differed in material respects from the basis of figures of overseas costs with which it was compared. If my memory is correct, the Australian figure, when assessed on a proper basis, came down to about 9 per cent. That paper is a public document. It has been distributed and is available to any honorable senator or, for that matter, any member of the public who may like to see it.
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– My question is addressed to the Minister for Civil Aviation. I understand that, in the splendid business transaction in which the Minister negotiated the sale of Australia’s share in Tasman Empire Airways Limited to the New Zealand Government, agreement was reached to permit both Qantas and T.E.A.L. to operate services between New Zealand and Australian airports. Does the agreement permit the operation by either company or both companies of services between New Zealand and Tasmania direct? If it does not, will the Minister consider having the agreement altered to permit such services, if required, as a further boost to the tourist industries of Tasmania and New Zealand?
– Let them go over to Perth, too.
– There is merit in that suggestion. The agreement provides that those airports on. both sides of the Tasman, in New Zealand and Australia, which up until 1st April were serviced by Tasman Empire Airways Limited, which was jointly owned by Australia and New Zealand, shall continue to be served by the New Zealand-owned T.E.A.L. and the Australian-owned Qantas. In other words, the airports that have been used will continue to be used. I am sure that the honorable senator is well aware that some pretty hard bargaining occurs in relation to airports when a bilateral treaty is framed. At some time in the future the attractiveness of Hobart may well be used by this Government to extract a very handsome toll from the other side of the Tasman.
page 712
– On 20th April, 1961, Senator Tangney asked me the following question, without notice: -
My question is addressed to the Minister representing the Postmaster-General and is prompted by the very large surplus achieved by the PostmasterGeneral’s Department, as indicated in the documents tabled in the Senate yesterday. When the Minister is considering the matters raised by Senator Buttfield, will he also consider having the printing in the telephone directories done in a larger type- than at present? I am quite certain that the buoyant state of the postal revenue is due, in a large measure, to the number of wrong numbers subscribers get because they cannot decipher the numbers in the directories. I will not say whether that is intentional or otherwise. In view of the increased postal revenue, if the Minister is unable to accede to the request to have the format of the telephone directories altered to a more readable print, will he agree to supply a magnifying glass to each telephone subscriber?
The Postmaster-General has now furnished me with the following reply: -
The 6-point type used in the Australian telephone books was designed specially for the purpose by the Mergenthaler Linotype Company of New York in association with the Bell Telephone Company of America. It is recognized as the most suitable type face- available for telephone directory printing and the main telephone directories in overseas countries have, for many years, been printed in type of the same size as that used for the Australian books. The British Post Office. after several years of research, has decided to change over to precisely the same style and size of type used in Australia.
The total cost of printing all the current Australian capital city and country telephone directories was approximately £1,200,000. Had the larger 7-point type been used iri all books; additional costs of at least £280,000 would have been incurred.
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– My question is directed to the Minister for National Development. Has the Minister read the statement appearing in to-day’s press, attributed to Mr. Petty, the Victorian Minister of Housing, in which it is claimed that at a meeting in Perth all State Ministers for Housing agreed to request the Commonwealth to renew the Commonwealth and State Housing Agreement in its present form? Will the Minister say whether that statement is correct or whether the Tasmanian Minister is the odd man out, because in Tasmania 850 persons are on the waiting list of the Agricultural Bank, which has been an approved institution under the terms of the Commonwealth and State- Housing Agreement? Is the Minister aware that the Tasmanian Federation of Housing Co-operatives has made an offer to the Tasmanian Government to supply finance within two years to the 850 persons on the Agricultural Bank’s waiting list?
– I have received a letter from the conference of State Housing Ministers in which they express their willingness to continue the present arrangement under the housing agreement. As is usual in these cases, they have made no acknowledgement of the many advantages that have flowed to them under the agreement, but they have criticized the features thai they would like to see improved. So far as Tasmania is concerned, the agreement will continue the proviso that 30 per cent, of the total moneys available to each State shall be diverted to building societies and other approved institutions. The Tasmanian Government has consistently maintained that the Agricultural Bank performs the same function as building societies. I am aware that building societies in Tasmania have stated that if money is diverted to them under the housing agreement they will cater for the people now being catered for by the Agricultural Bank.
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– My question is directed to the Minister representing the Minister for Trade. Is the Minister aware that reindeer steaks are on sale in Melbourne at 32s. per lb? Will the Minister tell the Senate from which country those reindeer steaks come? Will he also inform the Senate of the extent of Australia’s trade with that country?
– The question is one that could perhaps be better answered by a housewife than by a Minister. I am sorry that I do not know anything about this matter. I was not aware that reindeer steaks were being imported into Australia. All I can do is ask the honorable senator to place her question on the notice-paper, and I will obtain some information for her.
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asked the Minister representing the Minister for Repatriation, upon notice: -
– The Minister for Repatriation has- supplied the following answers: -
page 713
asked the Minister representing the Minister for Trade, upon notice -
– The Minister for Trade has supplied the following answers: -
page 713
– asked the Minister representing the Minister for Defence, upon notice -
Will the Minister provide the Senate with the latest information relating to the development and progress of nuclear power, militarily and industrially, in Japan and mainland China?
– The Minister for Defence has supplied the following answer: -
Japan’s industrial power requirements have outstripped its indigenous resources of fuel and hydropotential and necessitate substantial fuel imports.
A considerable effort has therefore been made by government and commercial authorities over the past five years to develop nuclear energy as an economically competitive source of power. Recently, however, a more cautious attitude has been evident, both in the government and leading power companies, to nuclear power development. This is shown by the Japan Atomic Energy Commission announcement, in December, 1960, that the aims of its development programme had been scaled down from 7,000 megawatts in fifteen years to less than 2,000 megawatts in twenty years.
At present two research reactors are being operated by the Japan Atomic Energy Research Institute, two other low-power research reactors have been installed in Japanese universities and several other research reactors are being planned for installation at universities and research institutes. A power reactor is being built for the Japan Atomic Power Company by the British General Electric Company. This reactor, a Calder Hall advanced type, should be completed by the end of 1963 with an electrical power output of I9S megawatts and will provide Japanese commercial interests with firm figures on which to assess the economic viability of nuclear energy as a power source in Japan.
The Japanese Government has, on more than one occasion, declared that it will not engage in nuclear weapon development, and indeed public opinion in Japan would be violently antagonistic to any such development. Japan has very limited indigenous sources of uranium and no facilities for the production in quantity of the fissile material necessary for nuclear weapons. It has entered into agreements with those nations supplying it with nuclear fuel under which Japan is accountable to those nations for the fission products resulting from the use of such fuel. In short, Japanese development of nuclear energy is directed entirely towards the economic production of power and the utilisation of radio-isotopes in industry, medicine and research.
Communist China has plentiful power resources which are as yet only partly exploited. It has nevertheless been engaged, since about 1955, in a research and development programme for the peaceful application of nuclear energy. This programme could also have military objectives. Indeed, statements by Chinese political and military leaders have revealed an intention to develop atomic weapons.
The only known reactor of any significance in China is a research reactor, provided by the Union of Soviet Socialist Republics in 1957, which is used for fundamental and engineering research and for the production of radio-isotopes for use in medicine, industry and agriculture. However, without discussing in detail our knowledge of the work being done in this field in Communist China, it can be said that if the Communist Chinese were to give a sufficiently high priority to the project, they could probably design and construct a reactor and other facilities necessary for the development of a nuclear weapon within from five to ten years from the date when they decided to proceed with such development.
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– On 23rd March, Senator Pearson asked for information on the future shipbuilding programme at Whyalla, and 1 undertook to provide him with further details. The Minister for Shipping and Transport has now given me the following information: -
There are six vessels under construction at Whyalla, ranging in size from a 32,250-ton tanker for Ampol Petroleum Limited to two 16,400-ton bulk carriers for Bulkships Limited. The other vessels under construction at Whyalla include “ Iron Dampier “, a bulk carrier of 19,000 d.w. tonnage and two bulk carriers each of 21,000 tons for Broken Hill Proprietary Company Limited. The estimated completion dates of these vessels vary from May, 1961, to mid-1965.
In respect of other yards, “ Kangaroo “, » 2,500-ton vessel for the West Australian Shipping Service and “ Troubridge “, a roll-on-roll-off ship of 850 tons for the Adelaide Steamship Company Limited, are being built by Evans Deakin and Company Limited in Brisbane; and at the State Dockyard in Newcastle a 2,000-ton container ship is being built for William Holyman and Sons Proprietary Limited, to be known as “ William Holyman “. Completion dates for these vessels range from June, 1961, to July, 1962.
All the above vessels are eligible for the Commonwealth subsidy. There are many smaller ineligible, non-trading craft at present on order at the various yards throughout Australia, such as the two 70-ft. tank landing craft at Phoenix Shipbuilding and Engineering Company Proprietary Limited, Devonport, for the Department of the Army, a self-propelled hopper barge at Walkers Limited, in Maryborough, for the South Australian Harbours Board, and six tugs at the Adelaide Ship Construction Limited for various owners.
In addition to the above programme, Cabinet has approved the construction of three new motor ships, each of 1,700 tons, for the Commonwealth lighthouse service. These three vessels will replace the well-known vessels “ Cape York”, “Cape Leeuwin” and “Cape Otway” and will be constructed at the State Dockyard. Newcastle. It is expected that the first of these will be ready for delivery towards the end of 1962.
The Australian National Line has announced plans to have constructed in Australia a 7,500- ton bulk carrier, similar in design to the present 7,000-ton deadweight “ I “ class vessels, and also a roll-on-roll-off vehicular passenger ferry for the Sydney-Tasmania service. Firm specifications have not yet been prepared nor has approval been sought for the construction of these two ships.
Other vessels expected to be ordered in the near future are a 5,500 d.w.t. container vessel for Mcllwraith McEacharn Limited, for which tenders have been called, and two vessels for the Union Steamship Company of New Zealand Limited, one of 5,000 d.w.t. and the other of 2,500 d.w.t
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– I present the report of the Public Works Committee on the following subject: -
Proposed construction of new general laboratory building for the Commonwealth Serum Laboratories at Parkville, in Victoria.
I should like to point out to the Senate that the committee found the Parkville buildings of the Commonwealth Serum Laboratories to be overcrowded and obsolete when judged by modern standards. The first portion of the building was erected in 1916, during the First World War, and the second portion was built in 1940. At present there are 1,076 employees at the Commonwealth Serum Laboratories at Parkville. The committee also found upon investigation that the value of sales by the laboratories rose from £139,000 in 1940 to £2,275,000 last year.
The proposed building is intended to provide space for the production of bacterial prophylactics and diagnostic reagents for veterinary and human use and for development work. Products for human use include poliomyelitis vaccine, tuberculins, diagnostic reagents and culture media. At present overcrowding is severe and there is no alternative to carrying out sterile and infective processes in close proximity. Since pooling of the final sterile products has to be done in the same area, there is always a possibility of batches becoming contaminated. That has recently been a subject of widespread concern throughout Australia. Cultural work is being carried out without the protection of adequate change-rooms for staff who are required to work with products involving highly pathogenic micro-organisms such as tubercle bacilli.
Evidence was given to the committee that the Commonwealth Serum Laboratories could not meet an emergency demand without reducing standards and exposing staff to the possibility of accidents by failing to pass products through the necessary procedures with the present degree of safety. Apart from inability to meet an emergency, the laboratories could not, without additional accommodation, meet the demands which will arise from future increases in Australia’s population. It is obvious that these unsatisfactory conditions should not be allowed to persist.
The evidence presented and the observations made during an inspection of the existing accommodation have impressed upon the committee the urgent need to erect a new laboratory building. The committee has recommended accordingly. The total cost of the project will be £470,000, comprised of £260,000 for the building, £82,000 for air-conditioning, £68,000 for other mechanical services and £60,000 for electrical services. The air-conditioning involved in this project is different from most other air-conditioning installations. As the number of operations in the laboratories increases and more industrial activity takes place in nearby areas, there will be a greater risk of contamination and spoilage of products. Because of this hazard and for economic reasons, it is important to prevent contamination. To meet these requirements, the installation of airconditioning is proposed for the four upper floors, and mechanical ventilation will be provided for the basement and ground floor. To provide sterile and dust-free air, it is proposed to install electrostatic filters with semi-automatic washing apparatus, high efficiency deep bed filters and ultra-violet lamps. These will provide complete isolation of the laboratory from any outside influences.
The committee regards the site proposed as suitable, and believes that the proposed building should meet requirements for twenty years. The present unsatisfactory conditions should not be allowed to persist, and the committee recommends that the erection of the new laboratory be proceeded with.
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Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Paltridge) read a first time.
– I move -
That the bill be now read a second time.
In the statement which the Treasurer (Mr. Harold Holt) made in another place on 23rd March, he set out the background to the Government’s decision to revise the Income Tax and Social Services Contribution Assessment Act in the manner which is now provided in this bill. He also foreshadowed some of the principal features which would be included in the new legislation. Honorable senators will recall that he outlined in that statement the difficulties the Government has faced in recent years in financing Commonwealth and State works programmes. Over the last ten years, more than 60 per cent, of Commonwealth and State capital works expenditure has had to be financed ultimately from Commonwealth taxation revenue. For this financial year, the proportion looks like being nearly twothirds.
The reduced support for public authority loans by the life companies, and the privately managed superannuation and provident funds, has been a major factor adding to these difficulties. I shall give honorable senators an example of this reduced support. While the life companies increased their total assets by £562,000,000 between 1949 and 1959, they increased their holdings of public authority securities by only £81,000,000 and of this amount only £4,000,000 was applied to Commonwealth securities .during the ten-year period. The total Australian assets of the life companies now exceed £1,000,000,000 and are estimated to be increasing at the rate of about 10 per cent, per annum. So far this financial year, they have actually reduced their holdings of public authority securities. Whereas the life companies held 50 per cent, of their assets in public authority securities in 1939, and 68 per cent, in 1949, the proportion had fallen to 37 per cent, by 1959, the last year for which full details are available. The incomplete details for 1960 suggest that the proportion had fallen by then to less than 33 per cent. There has clearly been a further decline this year.
A rather similar pattern is shown in the investments in public authority securities made by the privately managed superannuation and provident funds. Figures available for a number of the larger funds indicate that, whereas they held 50 per cent, of their assets in public authority securities in 1956, this proportion had dropped to 39 per cent, in 1959. In this case, too, the major portion of the decline was attributable to Commonwealth securities, as these funds actually reduced their holdings of Commonwealth securities by approximately onequarter between 1956 and 1959. An explanatory memorandum has been circulated, for the information of honorable senators, which sets out with some precision the implications of each clause of the bill. I have also arranged for a further memorandum to be circulated to honorable senators explaining three amendments accepted by the House of Representatives.
The new taxation arrangements for privately managed superannuation and provident funds are comparatively straightforward and are covered in a :new Division 9b of the principal act. If privately managed funds continue to comply with sections 23 (j) or (ja) of the principal act, their income will still be fully exempt from taxation, provided they maintain in their investment portfolios at least 30 per cent, of public authority securities, including 20 per cent, of Commonwealth securities or. alternatively, provided that they continue tO hold the amounts of Commonwealth securities and other public authority securities which they held on 1st March, 1961. and invest 30 per cent, of increases in their assets subsequent to that date in public authority securities, including at least 20 per cent, in ‘Commonwealth securities. J shall be referring later to this pattern of 30 per cent, of assets, or increases in assets, in public authority securities, including 20 per cent, in Commonwealth securities, as the “ 30/20 per cent, ratio “.
Privately-managed funds which retail* their 1st March, 1961, holdings of Commonwealth and other public authoritysecurities, but which do not achieve the 30/20 per cent, ratio in relation to their new investments, will continue to be eligible for exemption from tax on an amount equal to the 1960-61 level of their investment income. While the present scale of income-. tax rates is in operation, it is proposed that the income of these funds in excess of the 1960-61 level will be taxed at the rate of 5s. in the £1 on the first £5,000, and 7s. in the £1 on the remainder - that is the rates applicable to mutual life assurance companies. However, tax will not become payable on these funds until the 1961-62 income year and, according to established practice, the legislation to impose this tax will be incorporated in a separate bill which will be introduced during the- Budget session. lt will be remembered that the Government’s original intention in relation to the privately-managed superannuation funds, as set out in the Treasurer’s statement of 15th November, dealing with the proposed economic measures, was that these schemes would be required to maintain a 30/20 per cent, ratio in relation to their total assets. We have since modified this provision so that the maximum requirement for the privately managed funds to retain full exemption from tax will be to achieve the 30/20 per cent, ratio in relation to increases in their total assets.
As I have indicated, our general intention in this bill is that, even if increases in assets are not invested in accordance with the 30/20 per cent, ratio, the funds will be exempt from tax on an amount equal to the level of their 1960-61 investment income. It has nevertheless proved desirable to include a provision that, unless holdings of Commonwealth securities and other public authority securities are maintained at least at the level of 1st March, 1961, or, of course, if the 30/20 per cent, ratio is maintained in relation to total assets, privately managed superannuation and provident funds which do not attain the 30/20 per cent, ratio in relation to increases in their assets will in normal circumstances be taxed on the full amount of their annual income. Unless we made a provision of this nature, existing schemes would be able to remain fully exempt from taxation even though they limited the amount of their assets to present levels and transferred all of their present holdings of public authority securities to newly set up funds to enable those funds to qualify for taxation exemption as well.
It is realized that some superannuation funds may fail to achieve the 30/20 per cent, ratio and the other investment requirements, through force of circumstances more or less outside their control, while other funds may in special circumstances suffer temporary hardship in maintaining the prescribed ratios’.. For these reasons, the legislation provides that the Commissioner of Taxation may disregard any failure to maintain the 30/20 per cent, ratio if he is satisfied that the trustee of the superannuation fund concerned has made a genuine and bona fide attempt to achieve that ratio, or if he is satisfied that the failure was by reason of a temporary delay in investment. Again, if the Commissioner of Taxation is satisfied that the maintenance of the 30/20 per cent, ratio would be likely to endanger the financial stability of a privately-managed superannuation fund, he may inform the trustees that, notwithstanding the fact that the 30/20 per cent, ratio is not maintained, the fund will continue to be exempt from income tax for a period which he will determine in the circumstances of each case.
Life companies which wish to make themselves eligible for the taxation concessions which will be available under the new legislation will need to maintain a 30/20 per cent, ratio in relation to their total Australian life assets or, if they are now below the 30/20 per cent, ratio, they will need to enter into an undertaking to achieve it assoon as practicable, but not later than lune, 1971. The legislation places limitations on the extent of the investments which life companies may be required to make in order to fulfil this undertaking. Thus, unless a life company could otherwise not achieve the 30/20 per cent, ratio by .1971, it will not be required in any year to invest more than 40 per cent, of its increase in total assets in public authority securities, nor more than 25 per cent, of that increase in Commonwealth securities.
As is the case with the privately managed funds, the Commissioner of Taxation will be authorized to disregard any failure on the part of a life company to maintain the 30/20 per cent, ratio, or to comply in any particular year with the undertaking it has given, if the commissioner is satisfied that the company has made a genuine and bona fide attempt to do so, or that its failure was due to temporary investment delays-. Life companies which conform with this investment pattern will be exempt from tax on approved superannuation income, which will thus be on a similar footing to privately managed superannuation funds which also make the requisite investments in public authority securities.
These life companies will also be eligible for an important taxation concession by way of an increase in the deduction at present permitted under section 115 of the act. This is a deduction which has the effect of freeing from tax an amount ranging from 2i per cent, to 3 per cent, of each company’s Australian policy reserves. The deduction will be increased, for their ordinary life assets which is held in public every percentage point in excess of 30 per cent, in the proportion of their Australian ordinary life assets which is held in public authority securities. It will also be increased by one-half of 1 per cent, according to the excess over 20 per cent, of those assets held in Commonwealth securities. However, the bonus for holding Commonwealth securities in excess of 20 per cent, will apply only if the holdings of public authority securities other than Commonwealth securities are at least maintained during the year concerned at the amount so held at 1st March, 1961. This bonus for holding Commonwealth securities will also be offset by a reduction of one-half of 1 per cent, for every percentage point below 10 per cent, in the proportion of the Australian ordinary life assets which is held in public authority securities other than Commonwealth securities.
For companies which set up separate statutory funds this bonus will be based on the proportion of public authority security holdings in the Australian ordinary life statutory fund. For companies which do not set up separate funds, a method of apportionment of their income and assets is established under the new sections 112a and 1 1 5a. The effect of these new sections is to achieve a result similar to that applying where separate funds are set up.
There is no provision in the legislation for a bonus in respect of investment of superannuation assets. Where the 30/20 per cent, ratio is maintained for these assets, the superannuation income would qualify for full exemption from tax and no further tax advantage would accrue by maintaining more than this ratio. In view of what I shall say later, I should mention here that resident life companies eligible for the benefits I have described will continue to receive section 46 rebates on dividends included in their taxable income in accordance with the provisions ruling from time to time under that section.
Companies which decide not to avail themselves of the tax concessions will be assessed on their superannuation income on the same basis as their other Australian life income. These companies will have adjustments made to their section 115 deductions, which will be based on the proportion of their total Australian assets held in public authority securities and in Commonwealth securities. Their section 115 deductions, which in this case will apply to their combined Australian ordinary life and superannuation business, will be no higher than they would otherwise have been, but not less than three-quarters of that amount. The deduction will be reduced by 1 per cent, for every percentage point below 30 per cent, in the proportion of their total Australian assets held in public authority securities and by one-half of 1 per cent, for any deficiency below 20 per cent, in the proportion of those assets held in Commonwealth securities.
As with all other resident companies, life companies are entitled to dividend rebates under section 46 of the Income Tax Act but, whereas dividends received by other resident companies bear tax in the hands of shareholders when they are distributed in due course, dividends received by the life companies can be distributed to policy holders tax-free, since reversionary bonuses on life policies are not subject to tax. With the increased holdings of company shares by the life companies, this has become an increasingly valuable privilege. lt produces a sort of in-built discrimination against government securities, the income from which is taxable, and it thereby tends to increase the attraction of company equity investment. This is a consequence certainly never intended when the provision was introduced, and the Government has now decided that the privilege of full section 46 dividend rebates will be limited in the future to those companies which conform with the investment pattern in public authority securities which I have outlined earlier.
– Is that limitation of section 46 applicable to any company other than life companies?
– If you do not mind, I will have a look at the question and give you the answer when I am replying.
For companies which decide not to conform with the prescribed investment pattern, the rebates payable on dividends included in their life insurance income will, in the future, be limited to the amount of rebate which would then be payable on the amount of dividends included in their life insurance income in 1960-61. As with the proposed taxation arrangements for the privately managed funds, the amendments relating to the life companies will have effect for the first time in assessments based on the 1961-62 income year, and the exemption from tax of the superannuation business of companies which follow an appropriate investment pattern will apply in respect of income derived on or after 1st July, 1961. What I have said should be sufficient to give honorable senators a general picture to give new legislation insofar as it relates to the revised tax arrangements for the life companies and the privately managed superannuation and provident funds.
There is one additional matter which I should bring to your notice. Up to the present, the quite generous taxation concessions which have been allowed on life insurance business have been limited to companies whose principal operations have been in the field of life insurance. There are, however, several companies whose business is predominantly in other fields of insurance but which nevertheless transact a significant amount of life insurance business. These companies have heretofore been liable to pay tax on their life insurance business on the same basis as their other insurance business. The new legislation will, in effect, provide for similar tax arrangements for the life business of all insurance companies, whether or not life insurance constitutes their principal insurance business. Several sections of the new bill will necessitate modifications of a machinery nature to the Life Insurance Act. These are at present being drafted and will be introduced as soon as practicable. I commend the bill to honorable senators.
Debate (on motion by Senator McKenna), adjourned.
page 719
Debate resumed from 19th April (vide page575), on motion by Senator Gorton -
That the bill be now read a second time.
– The bill now before the Senate is complementary to one that was passed by the Senate last evening. Honorable senators will remember that that bill established by act of Parliament the Supreme Court of the Northern Territory. The court had been in existence before pursuant to an ordinance of the Northern Territory. That bill dealt with the salary of the person appointed to the office of judge of the supreme court of that Territory. This bill deals with an associated matter, namely his pension. In effect, the bill replaces by act of Parliament what is now provided by an ordinance of the Territory.
The Opposition does not object to the provision of a pension for the judge of the Supreme Court of the Northern Territory at the same level as those available for other federal judges. Back in 1948, the Labour Government reviewed the whole matter of judges’ pensions. At that time, a pension was payable to a judge on his retirement, but nothing was paid to his widow. A judge could get up to a maximum of 50 per cent, of his salary as pension. In 1948, the Labour Government introduced the new principle of providing for judges’ widows. At that time, an option was given to all judges to continue on the basis upon which they were then operating or, before nominated date, to elect to be dealt with on the new basis of a maximum of 40 per cent of salary by way of pension for themselves, and a maximum of half that amount for their widows. At the same time some provision, although not a very extensive one, was made for their children. In the event of both a judge and his widow having died, the sum of £1 a week was provided for each of their children under the age of sixteen years. So, for the first time, widows and children were incorporated in the concept of federal judges pensions.
Like the payment of an adequate salary, a pension frees a judge of worry about the future for himself, his widow and his family. That freedom is, in our view, a very important element in buttressing the integrity and impartiality of judges. But, surveying the Australian scene at large, the Opposition believes that some attempt should be made to put the pensions of judges, State and -Federal, on a comparable basis. I have examined the various State acts dealing with judges’ pensions, and 1 propose to summarize the general result of my investigation. Under section 12 of the 1948 Commonwealth act .dealing with .judges’ pensions, the Commonwealth allows up to ten years of service as a judge of a State court to count as federal service for the purpose of pensions. -But although the actual term served in a State, or ten years, whichever is the lesser, is treated as Federal service for this purpose, New South Wales is the only State that makes any reciprocal provision. The other .States .have no reciprocal provisions at all. It is ,true that the movement of judges between State. and Federal, spheres is more in the direction of moving from the State courts to the Federal courts, but there is always the possibility that a judge may wish to move from the Federal arena to the State arena. I understand that such a possibility was under consideration not very long ago. For example, a judge of .the High Court may see fit to move to a State court, particularly if the office of Chief Justice were open to him. At all .events, if the Commonwealth is prepared to recognize, for purposes of pension, State service of judges who are appointed to Commonwealth jurisdictions, there should be some reciprocal treatment by the States.
Let us look now at the pensions provided for judges in the State spheres. The maximum pensions available vary appreciably. They range from 40 per cent, to 60 per cent, of salaries, according to the State. In some States the pensions are 40 per cent, of salary; in other States they are 50 per cent., and in still others they are 60 per cent.
– Salaries vary, also.
– Yes, salaries vary, also. I will comment on .salaries ‘before I conclude my remarks. In the case of retirement at an early age from .one cause or another a lesser basic pension is provided based mainly on a five-year period, and increasing by a certain percentage for each year of additional service in excess of the basic five years. Again, that percentage varies from State to State. In some States it is an additional 2i per cent, of salary. In other States it is 3i per cent, and in still others it is 4 per cent.
Widows are provided for in all States but the amounts vary between 20 per cent, and 25 per cent, of the judge’s salary at the time of retirement. In the case of children, only the Commonwealth and Western Australia have legislated to provide for children where both parents are deceased. If children should be provided for surely they should be dealt with in a similar fashion by the Commonwealth and by each of the States. If it is not deemed appropriate to provide for children, present provisions in this regard should be discarded by the Commonwealth and by Western Australia, the only State in which such a provision exists. But .the .principle of providing for children having been established in .the Commonwealth sphere and in at least one State sphere, it is unthinkable that the Commonwealth and that State would be willing to discard the principle. The principle seems to .me to be just, and to be one that might b.e advocated .generally.
The remaining matter - I think it is the fifth matter that I discuss under this head - is contributions to judges’ pensions. At present judges are not asked to contribute. Accordingly, they are dealt with generously, it is right that they should be given the degree of independence that flows from the security assured to them and their families by the provision of a pension, but the question still remains: Should some system of contribution be introduced? ‘Such a provision exists at present in only one State - South Australia. fi have not dealt in detail with the provi sions governing pensions in each of the States. To do justice to the matter I would have to :take some time over each State because different conditions apply when a judge retires ahead of time or because of disability <or when he dies. Periods of service ‘very largely determine the quantum of .pension, and to go through all the conditions ‘in detail would be an extensive exercise. I do not propose to trouble the Senate with those details at this moment. I have said enough to indicate the great differences that exist between the States and the Commonwealth, and to put the Opposition view that an attempt should be made, under Commonwealth leadership, to have the States and the Commonwealth come together with a view to arriving at a general principle to follow in relation to judges’ pensions. At present, very great discrepancies can be found. Although we recognize that pensions may be related to salaries and that a plausible argument may be advanced to support the contention that a relatively small salary may be compensated, or deemed to be compensated, for by a relatively higher pension on retirement, we think that the whole matter of judges’ pensions could be looked at with advantage. We think that the various, questions to which I have referred should be examined with a view to seeing whether uniformity could be obtained and whether there is an underlying principle that should be followed. If it is found that there is such a principle and that uniformity is .desirable, an endeavour should be made to attain that objective.
What 1 am now putting to the Senate .is in line with what 1 said in committee yesterday when we were dealing with the salary of the judge in the Northern Territory. I drew attention to what had gone on in this field and to the urgent need, perhaps, for the States and the Commonwealth to get together to prevent very awkward and uncomfortable situations from arising. The States, in moving to establish the status of their judges, have increased the salaries of the judges .of .State supreme courts beyond those payable to justices of ;the High Court, thus forcing the Commonwealth, whether it wished to do so or not, into making substantial grants to federal judges. I referred to the case of the federal judges in the Northern Territory and in the Australian Capital Territory, whose salaries last year were increased by £2,200 a year, or approximately £43 a week. That increase was made in the course of one year. We gave the reasons for our objections to that last year. I repeated at least one of them yesterday - I shall not traverse the ground again - in order to focus attention upon the point that the Opposition is pressing, namely that the matter of judges’ salaries generally should be looked at. Proper allowances should be made for differences between the functions, the importance pf the work .and the general status of the various Commonwealth and State courts. We think that .not only salaries, bat also judges’ pensions .generally, should be examined. Accordingly, I moye-
Leave out “ now “, add “ this day six months in order that the Government .may confer with the States with a view to adopting a uniform basis for the payment of judges’ pensions “.
I would like it to be understood that I am using this amendment as a vehicle to enable, not only the question of judges’ pensions, but also the question of judges’ salaries to be discussed.
The Opposition .realizes that.if the amendment is accepted the bill will be laid aside and, so far as .this measure is concerned, no provision will be made ‘for a pension for the judge of the Northern Territory. We do not intend that the judge - or his wife, and possibly his children, if he were unfortunate enough to die - should be deprived of a pension by reason of the acceptance of the amendment. That position need not arise. The matter could, if necessary, be covered in the .interim by an ordinance of the ‘Northern Territory. Realizing what could be the effect of accepting the amendment, I say quite clearly and plainly, on behalf of the Opposition, that if, while further legislation were being prepared, the judge were to retire or otherwise become eligible under normal circumstances for a pension, the Opposition would very readily support any legislation to make the grant of pension retrospective. I am not unmindful of what could be the effect of accepting this rather drastic amendment and, being conscious of how readily the position could be cured, I formally give that assurance. The amendment has been submitted to focus attention in particular upon the aspects of salaries and pensions for judges throughout the Commonwealth to which I have adverted.
– I shall be extremely brief in saying why, in the view of the Government, the amendment should not be accepted. The effect of the amendment would not be felt by any of the judges of federal courts with the exception of the judge of the Supreme Court of the Northern Territory. The sole effect of this amendment would be to debar that judge from the pension rights that are available to all other federal court judges. I admit that the Leader of the Opposition (Senator McKenna) has stated that the Opposition would be prepared to support legislation with retrospective effect, if that were needed. Nevertheless the effect of the amendment would be to deprive the judge of pension rights until that legislation was passed.
The reason that the Leader of the Opposition has given for proposing the amendment is that the Commonwealth Government should confer with the State governments with a view to finding a basis for unanimity among the States on what they should pay their judges by way of salary and what proportion of that salary they should make available by way of pension. It ‘is quite clear that the States - which are not, when all is said and done, under our sovereignty - vary very considerably amongst themselves as to the sums of money they pay their judges. By and large, Western Australia and Tasmania pay their judges less than is paid to the judges in the larger States. In that way, I suppose, the emoluments payable to the judges in the various States are kept in line with the amounts which could be earned by practising lawyers in smaller States and in States where there is more competition and remuneration, such as New South Wales and Victoria.
So we are asked to project ourselves into a field which is not under our jurisdiction. Is it intended that we should ask the smaller States to raise the salaries of their judges, or that we should ask the larger States to reduce the salaries of their judges? It is quite clear that in any event we would be told, with some justice, either to mind our own business or to make appropriate payments to the States in which we wanted higher salaries to be paid to the judges. I think that it would be a retrograde step if we attempted to dictate to the States what they should pay to their judges by way of pensions or salaries. Furthermore, I think that to debar the judge of the Northern Territory, whom we have just appointed, from his pension entitlement until we have sought either to dictate to the States or to reach some unspecified agreement with them would not only be grossly unfair to that judge but also would be, I think, in some ways wrong in principle. That course would be most unlikely to achieve any degree of success, particularly within the period of six months specified in the amendment.
For these reasons, Sir, I ask the Senate to reject the amendment and approve the second reading of the bill, thus bringing the newly appointed federal judge into line with his colleagues in the federal sphere. By doing so, we shall establish a principle in a field which is within our control.
Question put -
That the word proposed to be left out (Senator McKenna’s amendment) be left out.
The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)
AYES: 25
NOES: 29
Majority . . 4
AYES
NOES
Question so resolved in the negative.
Original question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
page 722
Debate resumed from 20th April (vide page 632), on motion by Senator Spooner -
That the bill be now read a second time.
.- The purpose of this bill is to amend the original Export Payments Insurance Corporation Act that was passed in 1956. The purpose of the act was to assist in the promotion of exports by establishing a corporation to provide insurance for exporters against trading risks which were not normally covered by commercial companies. Under the act payments were made for risks associated with exchange control, social revolution, insolvency on the part of the buyer, and 1 think the Minister mentioned one or two other contingencies that could cause an exporter some financial difficulty.
The original act was amended in April, 1959, when the capital of the corporation was increased from £500,000 to £1,000.000 and the limited liability was increased from £25,000,000 to £50,000,000. In 1959, the act was again amended. The maximum percentage of the value of the goods that could be claimed was increased, and the types of risks were varied. Originally the insurer could receive 85 per cent, of the value of the goods, if he were entitled to it under the act. As a result of the amendment he was able to receive 90 per cent, of the value of the goods in the pre-shipment period and 95 per cent, in the postshipment period. I understand that that was for what were termed political risks. The measure now before us embodies two further principles. First, it enables the maximum liability to be exceeded. Secondly, if the Minister approves of any insurance proposition referred to him as being in the national interest, companies may have goods insured which the corporation would not insure in the ordinary course of business.
The record of the corporation is rather interesting. I can recall vividly the speech that was delivered by the Minister for National Development (Senator Spooner) when he introduced the original legislation. I should not think that so far the scheme has fulfilled his expectations. Of course, he cannot be blamed for that. In 1958 there were 43 transactions, involving an amount of more than £11,126,000. In 1959, there were 91 transactions involving a risk of £21,000,000, and in 1960 there were 127 transactions involving a risk of £26,429,000. If we divide the total risk in 1958 by the total number of transactions, we find that the average transaction was of the order of £250,000. By adopting the same process, we find that in 1959 the value of the average transaction was approximately £230,000 and that in 1960 the average, in round figures, was £208,000.
Those figures are a little puzzling to me. It seems that the corporation has not fulfilled the expectations of the original legislation. I should think that a number of small people would be interested in- the corporation’s activities. The report of the corporation certainly does not set out those in relation to whom a risk is accepted and the amount of the risk, but it seems to me that the corporation is becoming a rather exclusive club which provides insurance to a selected number of large exporters. I admit that others may crash in. There is nothing to stop the small man from getting in, but the figures seem to indicate that he has not done so. One is a little surprised and disappointed to find that the scheme has not worked out as well as we thought it would when the Minister introduced the original legislation.
Now let us look at the corporation’s administrative costs. In 1959 operating expenses amounted to £42,697 and the revenue received from premiums totalled, in round figures, £85,500. In other words, the corporation showed a profit for that year of about £43,000. However, in 1960 operating expenses jumped by approximately £19,000 to £61,986 and premiums fell by about £39,000 to £46,789. In 1960 the corporation showed a loss of £15,197. The Government loaned the corporation £1,000,000, interest free. It permitted the corporation to invest that money, and it was invested, of course, in Commonwealth securities. That gave the corporation an added revenue of £50,000. If we add that £50,000 to the sum of approximately £46,500 for premiums which were received in 1960, we find that the total revenue was approximately £96,500. As operating expenses were only £61,000, it could be said that in that year the corporation made a profit of £35,000.
It is a bit of a joke to suggest that this was intended to be a non-loss and nonprofit scheme, because the corporation was established to deal with a class of insurance which the ordinary insurance companies would not handle. If the Government wants to enter into the insurance business, 1 shall be happy to help it. This Government says that it believes in free competition and that it wants to be fair to all parties concerned. Whenever any one rises to say anything about the operations of TransAustralia Airlines and Ansett-A.N.A., my friend the Minister for Civil Aviation (Senator Paltridge) - I am pleased to be able to call him my personal friend - says that the Government believes in free competition, with fairness all round. Of course, that is only a joke, because the Export Payments Insurance Corporation undertakes only the risky business and the private insurance companies, which are raking off the big money, do not accept any risks at all in this sphere. They do not care whether the nation is able to find extra markets for its exports; they will not enter into that field. The corporation, on the other hand, cannot enter into any class of business that will deprive the private insurance companies of any profit. I always give the Minister for National Development (Senator Spooner) credit for looking after his own. If the limitation that is placed on the activities of the Export Payments Insurance Corporation is not an example of looking after the private insurance companies, I do not know what is. Time and time again we have accused this Government of having a policy one day and of having changed it by the next morning.
– Sometimes it has not waited as long as that.
– As Senator 0’Flaherty says, we are lucky if the Government’s policy remains unchanged for twelve hours. The Government has provided the corporation with £1,000,000, which is invested in Commonwealth bonds, from which the corporation receives a return of £50,000 a year. From this fund the corporation must build up its assets. But what does the Government propose in relation to the Postal Department? Only a week ago, the Government announced that the Post Office is to pay interest on money received, I think as far back as 1901. That money, from taxation revenue, was used for buildings and installations to provide a better postal system. The Government now says that the department must pay interest on it.
– So it should.
– Very well, but why treat the Export Payments Insurance Corporation differently? 1 desire to see the development of new export markets, but if the Government Wishes to go into the insurance business it should not hamstring its own corporation by making it take only the risky business. Up to date, fortunately, no claims have been made on the corporation. I certainly hope that it will continue to receive no claims. The corporation is not allowed to make a profit or to incur a loss, so its premiums are the lowest possible. It must be a worry to the corporation’s officers to keep the scales even. I do not know what guide they use to fix the premiums to be charged. I do not know whether success can be claimed for this system. The way in which the operations have been conducted is nothing less than farcical. That is proved by the statistics I have given. I should like to know the amounts involved, without the names, in order to determine whether we are assisting. I do not know whether the Minister really believes that this corporation has made a contribution towards increasing exports. Exporters are wise, shrewd, hard businessmen, just as the Leader of the Government is a hard, shrewd politician.
– Tough!
– Yes, tough. I want to know what the nation is getting out of it. In assisting exporters to sell our produce overseas, surely there is no need to go to such an extent that the only way in which the corporation can balance its budget is by investing £1,000,000 advanced by the Government and paying the interest into its account. Every one is concerned about our balance of payments position. This corporation is obliged to take the risks, but it must not accept the safe insurance propositions which are handled by the Government’s friends. At least let the corporation show that it can be run without using government money. Surely, premiums should be high enough to avoid losses, such as the loss of £15,197 that was incurred in 1960.
Does the Minister really believe that the corporation has fulfilled expectations? He stated in his second-reading speech, on 17th May, 1956-
The Government for some time’ has received representations from Australian exporters and manufacturers claiming that export payments insurance would greatly help them in building up export trade, particularly in face of increasing competition. These views were closely studied and important points were discussed with representatives of exporters, manufacturers, primary producers, commodity marketing boards, and commercial, banking and insurance interests.
I would go to a conference if I could come out of it in the way in which those people came out of it. When all is said and done, there should be a display of reason. I shall be extremely pleased if the Minister, when replying, will tell us whether the amount of premiums received and the number of insurances effected with the corporation have fulfilled expectations. Nothing conclusive appears from the figures published in the report to show that the corporation has achieved very much. I think more ought to be done if we are to assist it. We must be fair. What will happen if some claims are made? Will the Government pay again? Will the taxpayer be involved? If the poor old taxpayer is to be put in the ditch, he should be given a chance to make some money. He should not be regarded as a milking cow.
– You mean under the new set-up?
– Yes.
– The Government will authorize the insurances to be effected.
– Yes. The corporation has been lucky to date because no claim has been made. The corporation should be allowed to function in a field where it will be able, over the years, to pay claims and earn some money. The Government should not keep all the preserves for its friends. I speak not in a personal sense but in a political sense.
I believe that the act ought to be further amended for the purpose of permitting the corporation to expand and provide insurance for exports of any kind. I suppose that exporters who wanted to send goods to Cuba at the present moment would be a little worried because of the trouble in that country. If there is a possibility that exporters will experience difficulty because of circumstances such as those, the corporation comes into the picture, but if it is a case of exporting goods to the United States of America, so that the exporter is pretty sure to get his money, the big insurance company which has its office either in Martinplace in Sydney, or in Collins-street - the golden mile - in the city in which I live, gets its pound of flesh.
– Does the honorable senator think that exports to Cuba would not be a good proposition?
– I am not saying that they would or would not be a good proposition, but if I were an exporter, I should like to make certain that the goods I was exporting were going to countries where payment was assured.
– Does not the honorable senator think that we will get our cut from the man who is successful?
– Yes, up to a point. I am not saying that the Government does not derive revenue from company taxation, but of course, not only companies pay taxes. I think it is fantastic for the Government to say, “Taxes on companies shall be at such and such a rate, and it does not matter whether they are earning £20,000 a year, or £10,000,000 a year “.
The Opposition will not oppose the bill. However, we on this side of the chamber are still hopeful that the corporation will eventually approach somewhat more closely the intention that was in the mind of the Minister when the original legislation was introduced. The Labour Party expresses the opinion that the corporation ought to engage in the insurance of all export commodities. We believe that if it did so, the result would be to increase exports. It is not the purpose of the corporation to make profits. If the business of the corporation were expanded, the premiums which exporters have to pay would be a great deal less than in other fields of insurance. The Labour Party believes that the corporation should provide insurance cover for classes of exports which it is not at present permitted to insure. As I have said, I think that the corporation ought to provide insurance cover for all exports.
I was rather worried, Mr. Acting Deputy President, by a report which I read to-day to the effect that Canada had made a sale of wheat to China, on credit, worth approximately £A26,000,000. I like to see cash on the nail, but of course that is not always the case with nations. I do not know what the Australian Wheat Board will finally decide regarding the sale of wheat on credit. I suggest that the new class of business which the corporation is to undertake - transactions in which it is considered that it will be in the national interests to provide insurance cover - will be even less profitable than the business that it has transacted to the present moment. It is true that any losses incurred in providing insurance cover for such transactions will be made good, again, by the poor old taxpayer.
Is it intended that the Parliament will be denied an opportunity to discuss what will be, in some instances, a grant of pubic money to a private firm? I suggest that if private firms are to have the benefit of such conditions, we in this Parliament ought to know their identity and the amounts paid to them. The business organizations concerned should not be afraid of having their names published in the report of the corporation. After all, they will be receiving from the corporation an advantage that might be described as most-favoured-firm treatment. I do not suppose that it would be a good business proposition to publish the names of the organizations that have used the facilities of the corporation to date) I recognize that it would not be altogether fair to do so, but I suggest that since public revenue is to be expended, or may be expended, to provide insurance cover for exports which are considered to be in the national interest, details of the organizations receiving the insurance cover ought to be made known.
I believe, too, that the report of the corporation should provide information concerning the amounts of insurance cover provided. It should show, for instance, that there were so many cases of insurance cover for amounts of £50,000 or less, and so on. Information such as that should be published so that the people may know the amounts involved. At the present time, the only way in which it is possible to ascertain the approximate amount of each transaction is to divide the total amount of premiums by the number of transactions. When all is said and done, the nation is giving exporters a service that no one else will provide for them. As we know, if a private insurer is prepared to insure, the corporation may not take the business. It seems that the only business which the corporation may transact is that in which a great risk is involved. I think it is essential that the corporation should be able to charge premiums that are sufficiently high to cover its working expenses. I do not believe that there should be a further hand-out to certain people, however great may be the need for Australia to increase its export trade.
While the Australian Labour Party does not intend to oppose the bill, Mr. Acting Deputy President, it criticizes the measure on the grounds that I have stated. We on this side hope that the corporation will achieve the success which the Minister foresaw for it when the original legislation was introduced, but it has gone only a very short way towards doing so. It is difficult to ascertain the degree to which exports would have increased had the corporation not been set up. Despite all the protestations of Government supporters that they believe in free and fair competition, I think that the corporation is hamstrung. Australia needs to increase its export markets, and that need will continue. Let us hope that this bill will help to solve our balance of payments problem.
– I rise to support this measure. 1 am pleased that the Deputy Leader of the Opposition (Senator Kennelly) has announced that the Opposition will not oppose it. The bill is designed to increase Australia’s export income, with which aim Senator Kennelly agrees. The Government is always anxious to look after our export income because if we cannot increase it we will not be able to import essential goods, and the standard of living of the Australian people will be lowered. The Export Payments Insurance Corporation, which was set up by this Government in 1956, is charged with the business of ensuring payment to exporters of goods. It provides an insurance scheme which would not be provided normally by any other insurance business in Australia.
– Because there is too much risk in it.
– That is so. The risk is too great. Therefore, the insurance companies do not take on this business. That is why the Government, in its anxiety to increase exports, set up the Export Payments Insurance Corporation. We are not running away from that. The Government has instructed the corporation not to provide, any kind of insurance that can be handled by the companies operating in Australia at present.
– Of course it has.
– We believe in private enterprise. What is wrong with that?
– We are quite different from the Labour Party. Senator Kennelly did not quite say what Mr. Pollard said in another place. The “ Hansard “ report of part of Mr. Pollard’s speech reads -
When I read of such occurrences I am forced to the conclusion that it is a tragedy that the parliaments of this country have not, long before this, ensured that all fire, building and other such types of insurance are no longer the responsibility of private concerns, but that they shall be controlled and conducted entirely by the nation in the interests of the nation.
Mr. Osborne. Do you want to nationalize all insurance?
Mr. Pollard. I would have nationalized it long ago. . . .
Mr. Pollard who was a Minister in a previous Labour government, thus admitted Labour’s policy of nationalization, which honorable senators opposite evidently stand behind.
– This bill is 30 per cent, nationalization.
– That is not so. The last time I spoke in this place I happened to mention something and because I digressed an Opposition senator, who was then in the chair, sat me down. I do not intend to digress to-day. I want to keep to the measure. It is important to the people of Australia that the Government should do its utmost to keep their standard of living as high as the Government has been able to keep it in the last twelve years. The people, never dreamt that they could enjoy such a high standard of living and while we are in power we intend to maintain it. The Deputy Leader of the Opposition nods his head in complete agreement. I am sure that if his party came to power on some future occasion it would be proud to endeavour to maintain the standard of living that we have achieved in Australia during the last twelve years.
Since the Export Payments Insurance Corporation was established in 1956, it has issued policies of a face value of more than ?75,000,000. How much of that export trade, which is so vital to Australia, could have been achieved if we had not had this corporation? We can take it for granted that the private insurance companies would not take the risks in this type of business. So, as a result of the establishment of this corporation, in the last four years Australia has sold overseas goods to the value of about ?75,000,000. They could not have been sold otherwise.
– I would not say that.
– I say they could not have been sold under the normal insurance arrangements that existed prior to 1956.
The Government, having amended the act once before, now says, “ We will amend it again. This time we will insert a clause which we will term a national interest clause.” Under this clause, if the corporation, in the normal course of its duties, says that it does not believe that certain business is a sound risk, for political reasons the Government may consider it wise to take the risk. The proposition is then submitted to the Cabinet.
– Surely it would not do so “ for political reasons “.
– It may be for political reasons.
– In the national interest.
– Yes, in the national interest. I am sorry if you misunderstood me. I do not mean political reasons inside Australia, but political reasons outside Australia.
– International politics.
– Yes, international political reasons. The Government may want to do business with a certain country. By promoting trade with that country, the Government may put it on a sound basis. As a result of one deal, that country may expand its trade and continue to trade with Australia without the necessity for the guarantee provided by the corporation. In dealing with propositions that come within the national interest clause the Cabinet will consider whether they hold promise of opening up worth-while new export markets for Australian products, whether an industry with high export potential will be stimulated, whether the transaction is important for a particular Australian area of industry, and whether the transaction will confer some obvious and significant benefits in our trade relations with the country concerned. Those are the matters that will be taken into consideration before the Cabinet grants permission to the corporation to accept this particular type of risk.
The corporation has a liability limit of £50,000,000. It will not be asked to accept risks for amounts in excess of that sum. The type of transaction covered by this provision will not be included in that liability. So the corporation is free to act as it wishes. It knows exactly where it stands in respect of its liability up to £50,000,000. If the Government gives any instruction to the corporation to accept insurance liability on exports which the corporation is not prepared to accept, the Government will take the full responsibility. Having accepted that responsibility the Government must weigh carefully the pros and cons of each situation as it arises. As the corporation has not been involved in any claim since its inception, I think it is fair to say that the Government will be able to continue this type of insurance, even with the new provisions set out in the bill, without any cost to the taxpayers. But the risks must be weighed carefully. I think that 15 or 16 countries operate national insurance corporation schemes at present. The first scheme was started, I think, in 1921 or 1922 by Great Britain. Canada has transacted, under her scheme, some 300,000,000 dollars worth of business.
– In what period?
– I cannot remember. The scheme has been in operation in Canada longer than ours has, yet it has not had a Claim against it. Bearing that in mind it will be realized what scope there is in Australia for accepting business of this kind in order to increase our export income.
– This is a form of protection of Australian industry.
– That is so. That protection having been given through the scheme, the banking fraternity is more willing to finance the export of goods from this country. That is important. This kind of business is growing throughout the world. The United Kingdom Government’s export credit guarantee department, which is a government agency, for the year 1952-53 insured 15 per cent, of Britain’s total export trade. For the year 1958-59 the corporation in the United Kingdom transacted about 18 per cent, of the total insurance business on exports from that country. It will be seen that all countries, particularly the free countries, are moving towards insurance of this kind in order to protect their exporters.
The Leader of the Opposition (Senator McKenna) stated that the Labour Party did not oppose this measure. Therefore, it must be assumed that the Opposition is in agreement with it. Although the Leader of the Opposition was a little critical of the measure, he could not find any real faults in it. In effect, his attitude to the bill indicates that he concedes that the Government is determined to increase Australia’s export earnings. What interests me far more than that aspect is the fact that three or four times in the past eight weeks the Government has announced that it has no inter.tion whatever of re-introducing import licensing. Having noted the improvement in our overseas balances, I am convinced that the Government will not re-introduce import licensing.
– You have great faith.
– Yes, I have. I realize that the Government intends to increase Australia’s export earnings. One way of achieving that objective is to reduce the risks to which the Export Payments Insurance Corporation is exposed. When our export earnings rise by £70,000,000 or £80,000,000 in the next two or three years we shall have said good-bye forever to import licensing.
I commend the Government on bringing down this bill, which I support wholeheartedly.
– It is interesting to note that I follow in this debate a Government supporter. I am a little disappointed in the Opposition. I should have thought that honorable senators opposite would have been eager to take part in the debate in order to expound their policy of nationalization of insurance.
– We have said that we do not oppose the bill. You are only wasting time.
– Despite Senator Kennelly’s grudging support of the bill, I think all of us realize that the Labour Party still adheres very strongly to its policy of socialization of insurance. Perhaps honorable senators opposite believe that the Export Payments Insurance Corporation is a step towards socialization, but I very strongly hold the opposite view.
The measure before the Senate is the direct result of the Government’s recently announced policy to boost Australia’s export earnings. The bill is designed to strengthen our immediate and long-term export-earning capacity not only in the field of primary industries, but also in the field of secondary industries. In fact, the bill may be said to cover the whole gamut of our export industries. I am sure that it will prove to be of great value in that regard.
The bill will provide an extension of facilities to exporters, and will provide an added incentive to obtain new business on the world’s markets. That will help our balance-of-payments position. Although there has been some improvement in our balance of payments in recent weeks, we all know that the situation cannot be treated lightly. We know that the maintenance of our balance of payments overseas at a satisfactory level is necessary to our development, and to the welfare of the people of this country.
A few moments ago, Senator Brown chided me for wishing to speak on this bill. He said that all parties were in agreement on it, and that it should be passed without delay. There is something to be said for his argument. I do not think that it does any harm to recapitulate some of the matters that are related to this subject
– So long as it is not tedious repetition.
– I do not think that anybody could charge me with being tedious by repeating what I have heard. I always try to develop an argument in my own way. In debate, I have never resorted to plagiarism, as is sometimes done on the other side of the chamber.
The original legislation was an interesting experiment. Nothing of this kind had previously been considered by the National Parliament. It was entirely novel and was designed to promote our overseas trade. We know that it is very important for exporters to have a sense of security about their payment for the products they send overseas, and only by insurance can they be assured of payment for goods that are sent to markets in countries that are doubtful quantities, both financially and politically. In 1956, the Government of the day considered that it was essential to produce a plan to ensure that exporters would be recompensed for their trouble in seeking and locating fresh markets overseas. It was for that purpose that the initial legislation was brought down in that year. The preamble to the bill read -
A Bill for an Act to promote Trade with Countries outside Australia by establishing an Export Payments Insurance Corporation to provide Insurance against certain Risks arising out of that Trade not normally insured with Commercial insurers.
I think it will be conceded that in introducing that measure the Government broke new ground, because up till that time our overseas trade had been confined to our traditional markets. In those days, there was no doubt that the exporters would be paid for the meat, wool, metals, wheat and other produce that was exported to our traditional markets. Consequently, there was no need for an export payments insurance scheme. However, as Australia was further developed it became necessary to widen our field of trade. As was stated in this chamber recently, this country ranks now among the first tea trading nations of the world. To increase our international trade, it became necessary to introduce an export payments insurance scheme, so that exporters would be encouraged to find and develop new markets overseas.
– Has the Export Payments Insurance Corporation incurred any losses?
– As far as I know, the corporation has not made any losses, and I trust that it will not make any in the future, although that may be expecting too much. The corporation had a modest initial capital of £500,000, and the amount of liability that it could incur was limited to £25,000,000. It must be remembered that when the initial legislation was introduced in 1956 we had available very little experience in this field by other countries to guide us. The scheme was not put into operation until 19S7, because we had more or less to comb the world to find a man of sufficient experience in this field to administer the corporation. At the time, some of us became a little impatient because it was taking so long for the scheme to come into operation. However, as I have said, the scheme did commence in 1957, after we had obtained information from the United Kingdom and Canada, in particular. We were fortunate to secure as commissioner a man whose experience qualifies him to guide the destinies of this organization.
From time to time, since 1956, amending legislation has been introduced. As I have said, the corporation commenced operations with a capital of £500,000 and its liability was limited to £25,000,000. In 1959, the corporation’s capital was increased to £1,000,000 and the limit of its liability was raised to £50,000,000, the present figure. At that time, it was permissible for the corporation to provide commercial cover only up to a maximum of 85 per cent, of a loss. Later in 1959, in respect of “ political risks “, the percentage was increased to 90 per cent, in relation to the pre-shipment period and 95 per cent, in the post-shipment period.
It is interesting to note how this scheme has developed and is proving its worth to the general economy of the nation. It is also interesting to consider the amount of business that has been done by the corporation. In 1957-58, the financial year after the inception of the scheme, the corporation wrote business of an approximate value of £11,100,000. In the following financial year, the amount rose to £29,100,000, and in 1959-60, to £26,400,000. As Senator Scott has said, this corporation has already issued policies with a face value of over £75,000,000.
The field of coverage, geographically, is very wide, extending to over 100 markets throughout the world. This scheme has, as Senator Scott also mentioned, received the approval of the banking institutions, which have stated that applications for advances will be much more favorably considered if the exporters concerned have adequate coverage under the scheme. Consequently, credit is much more easily available to exporters who have adequate export payments insurance.
It it not my intention to take up too much of the time of the Senate on this very important matter. We know that the purpose of the bill is to enable exporters to cover new territory. However, I think we should have a look at the reason why the Government has decided to insert the national interest provision. The meaning of this term is not precisely defined, but Senator Scott has explained its general meaning. I do not think it is necessary for me to repeat it. Although very few countries have embarked on a similar scheme, we have the experience of England and Canada to guide us. When the Minister in another place introduced this bill he made reference to the national interest provisions. I think they are important as exports are definitely in the national interest.
The idea embodied in this amendment to the act has been approved by the Government after consultation with various bodies that are engaged in the export field. The principle has been supported by such competent bodies as the Consultative Council of Export Payments and the Export Development Council. I understand that the Chamber of Manufactures has also given its approval to the scheme. Under the national interest provisions of the bill the corporation will accept insurance risks on commodities which are normally outside its liability limit. The corporation which we know as E.P.I. C. will, in fact, act as agent for the Government in determining contracts, collecting premiums and paying claims.
– Will the corporation be the judge of the risk?
– In the first place when the insurer comes along with a proposition which comes within the ambit of the national interest provisions the matter will have to be referred to the Minister. It will be considered by the Government and if the Government approves the insurance will be effected. The corporation acts more or less as the agent for the Government because it is the Government which in fact accepts the risk. The Government can exercise discretion as to the limit to which it is prepared to go, and the amount will not come within the corporation’s risk limit of £50,000,000. This provision will be of great value in promoting the sale of exports under difficult conditions.
The measure comes within the scope of the general export policy laid down by the Government in recent months. The Government plans to develop trade in commodities that have not hitherto been exported in substantial quantities. We have learned from time to time in the press and elsewhere of the proposals that the Government has in mind for the furtherance of the beef industry. It has plans also to increase the export of coal, steel, minerals and cereals. We have been able to sell to Communist China - or red China as it is sometimes described - a vast quantity of cereals. It is absolutely essential that we should trade with these outside countries, and in my opinion Communist China should be no exception. I am not compromising the Government or anybody else because I have always believed in the policy of free trade. Although the red Chinese may be Communists, they are human beings who need food. We have the cereals to sell them and it is our duty to come to arrangements whereby we can trade on a sensible basis with a country such as red China. I make no apology for saying that.
The Government is planning also to develop the transport system in Australia with a view to increasing our exports. Transport has a direct relation to our export trade. An important developmental scheme has been envisaged for Western Australia. It involves the transport of iron ore to Kwinana. The whole scheme hinges on the carrying out of a rail standardization project. Rail standardization is necessary for the development of our export trade. Unless we standardize the Kalgoorlie-Perth railway we will not realize our ambitions for the export of iron ore, no matter which country we may have in mind as a buyer. I stress also the importance of rail standardization proposals in South Australia. We will assist our export trade to the degree we are able to transport our products to the seaboard economically. We will be in a much better competitive position with the rest of the world if we can reduce our costs. The standardization of the line from Broken Hill to Port Pirie would enable us to reduce the cost of transporting our ore and would put us in a much more favorable position to compete with the rest of the world. Such schemes all help us to build up our export trade.
The same can be said about any number of other commodities that we export. For example, the objective of the Government in propounding a scheme for more arterial roads is the reduction of costs so that we may be in a more favorable position on the world’s markets. That scheme should give a real impetus to our export trade in beef. I could enumerate quite a number of other factors affecting primary and secondary industries which all have a bearing on our export trade. I am confident that we shall be able to increase the number of commodities that we can export, but that increase will not be achieved in just a year or two. We must remember that in the life of a nation a few years is a very short space of time. But when we produce commodities for export we want to be in a position to export them to the world at large.
Some of our traditional markets have dried up to a degree and we must seek other markets. But we need in the national interest - that is a very good term - the backing of such a scheme as the export payments insurance scheme. Although the proposal now before us may not go quite as far as the Opposition would like - the Labour Party would like to enter the whole realm of insurance - I believe it will serve a very useful purpose. Private enterprise already provides an adequate system of insurance for other purposes, but the class of business envisaged in this legislation is not covered by private enterprise because of the risk involved. Senator Scott made no secret of the fact that the risks involved in some of the new markets are considerable. I believe it is the duty of the nation as a whole to bear those risks. I say without any hesitation, Mr. President, that in the long run the legislation now before us will provide the backing that will be necessary when we are dealing with unknown quantities in some of the new markets. For that reason, I believe the bill is worth while and is a very welcome addition to the original legislation, which may not have been as elaborate as Senator Kennelly would have wished but which nevertheless has served a very useful purpose.
Senator SPOONER (New South WalesVicePresident of the Executive Council and Minister for National Development) [5.39J. - in reply - I thank the Opposition for its support of the bill, and I thank Senator Scott and Senator Hannaford for helping me to pilot it through the Senate. I propose to reply very briefly to some of the points that were made by Senator Kennelly. In our consideration of this matter we must start upon the assumption that the purpose of the Export Payments Insurance Corporation is to insure risks that cannot be insured elsewhere. I shall not enter upon a philosophic argument but shall simply state facts to show that this form of protection could not be obtained anywhere else and that without such a corporation you would not be able to insure exports to the extent to which they have been insured.
The report of the corporation shows that for three years the total value of policies written by it has been of the order of £75,000,000. When we remember that no other insurance is available for the class of business involved, we cannot decry that sum. When we remember, too, that the value of our exports is £800,000,000 a year, it will be noted that the value of the policies taken out with the corporation represents 3 per cent, of the total value of our annual exports. Such business is not to be put lightly on one side. The report of the corporation shows that the business has been spread over a very wide area, 48 per cent, of it having relation to Asian markets. A total of 118 markets were affected in the last year of the corporation’s activities. The report of the corporation for that year includes this passage -
In the latter category were many small traders who for a variety of reasons found it difficult to establish themselves in the export field.
So the corporation has justified its existence. Now it has reached the next stage of its career.
– Is the corporation to be a permanent institution?
– Does the honorable senator mean the present scheme?
– Yes.
– I do not think anything is permanent in this world in which we live, but most things that are commenced last for a long time. As I was about to say, we now come to the next stage of the corporation’s career, during which there will be risks that the corpora tion feels it would not be justified in accepting but in relation to which, because of its expert knowledge, it could act as an agent for the Government. The proposal now before us is not in the nature of a handout. Premiums will be payable, just as premiums have been payable on transactions that have been insured in the past. Just as the corporation’s business in the past has been profitable, so we hope that, in the national interest, this new business will be profitable. However, profit is not the criterion; export income is the criterion. It is for the purpose of obtaining extra export income that the legislation has been introduced.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Sitting suspended from 5.43 to 8 p.m.
page 732
Debate resumed from 20th April (vide page 633), on motion by Senator Paltridge -
That the bill be now read a second time.
.- The bill proposes to amend the Defence Forces Retirement Benefits Act of 1959. This act was the outcome of the deliberations of a committee under the chairmanship of Sir John Allison, which investigated the whole subject of pay, retirement benefits and pensions applicable to the Commonwealth armed services. As is the case with most legislation dealing with personal and human affairs, anomalies have crept in. There are various shortcomings and there are borderline cases that require periodic, sympathetic review. We on this side of the Senate do not propose to oppose the measure because we think that its provisions are of benefit to members of the forces. The Minister for Civil Aviation (Senator Paltridge) said in his second-reading speech that the 1959 act superseded the 1948 act, which was introduced by the Chifley Labour Government. As a result of the Allison report, several improvements were made and the whole field of retiring benefits was reviewed. At the same time higher rates of contribution to the Defence Forces Retirement Benefits Fund were applied.
One of the chief amendments proposed in the bill relates to an election by members of the forces who were serving either in 1948 or at the time of the enactment of the principal act in 1959. They were given a choice whether they would or would not come under the terms of the act in regard to superannuation. In simple language, this provision is similar to provisions in Commonwealth and State superannuation acts applicable to public servants, whereby officers may stipulate the number of units for which they will subscribe within their salary ranges. In the armed services the rate of superannuation for retirement benefit varies in accordance with rank and length of service. The bill provides that members who, under the 1948 act, and under the 1959 act, elected not to become contributors, will be given an opportunity to join the scheme. The time has been extended to enable those who may have been wavering to obtain full retirement benefits. An important provision of the bill gives a serviceman who was not an officer in 1959 the benefit of the formula if this provides a greater benefit than the amount fixed in accordance with years of service. I shall not dilate upon the formula, which is rather complicated. On the recommendation of the Allison committee, members of the services were given a substantial incentive in the form of an appropriate retiring allowance.
I mentioned earlier that all legislation of this type contains anomalies. One anomaly in the principal act that comes to mind is the provision applicable to the widow of a contributor. The Minister stated in his second-reading speech in 1959 -
The Government indicated in the Budget speech that it was proposed to allow superannuation contributors the opportunity of contributing for an increased rate of pension for their widows. As I have said earlier, the present rate of widow’s pension is one-half the pension payable to the member. This will be increased in future, on a contributory basis, to five-eighths of a member’s pension. A similar extension of benefit has been granted to contributors to the Defence Forces Retirement Benefits Fund. However, whilst future entrants to the forces will be required, as a matter of course, to pay the appropriate contribution for a five-eighths widow’s pension, existing contributors will be given the right to elect whether or not they wish to contribute for the increase.
I direct attention to the amount payable to a widow. Five-eighths, in present cir cumstances, is a very meagre proportion for persons who- are often in the prime of life; The average retiring age is in the middle forties-, or under fifty years of age, and widows of former serving members often have children of school age. Special consideration should be given to them because of their circumstances.
Another anomaly, in my view, is the provision that applies to a widow who remarries. Upon that eventuality, so far as I can gather, entitlement to retirement benefit ceases. Similar provision should be made in this legislation to that which is in the Repatriation Act, whereby a lump sum payment or some other provision is made for the children of a widow who re-marries, so that their education is provided for in their early formative years. When a widow with a. young family re-marries, the new bread.-winner often has the extra responsibility of an additional family, which means that the children of a deceased exserviceman may have their’ opportunities reduced. This was not the wish of their father when he was contributing to’ the fund. He contributed willingly in the belief that his widow and children would be provided for. Provision of some sort should toe made to ensure that the intentions of contributors are fully carried’ out, and that proper provision is made for the children of a widow who re-marries.
Except for the proposal to provide for the granting of extended time for persons to elect to become contributors to the fund, the proposed amendments of the act relate only to machinery matters which are not opposed by honorable senators on this side of the chamber. The principal act covers the whole range of benefits, which will not be materially affected by this bill. We are happy therefore to see the measure passing through the Senate. As the Minister stated in his speech in 1959, the efficiency of the defence forces depends on the quality of the Service personnel and on the readiness with which recruits of a high standard come forward for service in the forces. Provisions such as those of the Defence Forces Retirement Benefits Act are an incentive to men of high quality to join the services. Therefore, Mr. President, we on this side of the chamber do not oppose the measure. We wish it a speedy passage.
– Fortunately, this is not an occasion for debate. I find myself in full agreement with everything that my friend Senator O’Byrne has said. I propose simply to mention one or two aspects of the bill which I think are of importance and which should be kept in mind. One of the features of the defence forces is that retirement is relatively early in comparison with that in the Public Service and other walks of life, particularly if the officer concerned does not pass beyond comparatively junior rank, because physical fitness and alertness are of the very essence of the fighting services. Therefore, special provisions must be incorporated in retirement legislation for the defence forces.
The main features of the measure before us belong to the act of 1959. The bill is in the nature of a readjustment in respect of officers who have opted not to take the full retirement benefit. That, of course, is something that may happen in any service. There are always people, particularly young people, who do not foresee everything that they may need for themselves or their dependants. In many cases, people are apt to over-rate their own staying power and capacity to cope with future conditions, and for that reason they leave aside a benefit that they might otherwise enjoy. This bill is designed to give to those who perhaps have made a wrong decision an opportunity to make the right one. Persons who have elected not to contribute will now have an opportunity to do so.
One or two details have been mentioned by Senator O’Byrne, and I think that at the committee stage we may have an opportunity to suggest possible improvements or to discuss possible defects. 1 do not think it is necessary for us to do so now. The Opposition approves the bill, and we on this side certainly do so. In my opinion, it represents the fullest measure of justice that can be done at this stage to those persons who did not elect earlier to take the course that they are now being given the opportunity to take. I think it can be said that the bill seeks to carry out the obligation, which I think every government of this country has honoured - certainly since the end of the First World War - to give full opportunities for the future to the children of servicemen. As Senator O’Byrne has so wisely said, it is necessary to have people who will take up a career in the defence forces and who will regard such service as the main purpose of their lives. In order to encourage them to do so, we must make provision for their retirement and for widows and orphan children. It is not necessary for us to debate the bill at length; we all approve it. I therefore commend it, in the words of Lincoln, as a measure designed to see that he who has borne the battle, and his widow and orphan, have the fullest measure of justice.
– in reply - I express pleasure that the Opposition does not intend to oppose the bill. Senator O’Byrne has acknowledged that the measure represents a further refinement of the Defence Forces Retirement Benefits Act. It carries with it many advantages for those who are members of the Defence Forces Retirement Benefits Fund. I was very pleased to hear Senator O’Byrne refer to the work of the Allison committee which was given an extremely complex task to undertake and did a truly magnificent job. I think that we should acknowledge our debt to it.
Senator O’Byrne also referred to the position of widows and children of servicemen, and also to that of orphan children. It will be remembered that in 1959, widows were provided for, in that the Government appropriated from Consolidated Revenue an amount sufficient to pay to them a pension of up to five-eighths of the full pension. That indicates that the Government was not unaware of the need to look after the interests of widows. Senator O’Byrne also stated that it was necessary to pay a pension to the children of widows who remarry. The honorable senator apparently has overlooked the fact that provision already exists for a pension to be paid to such children. The pension continues to be payable to them, after the re-marriage of a widowed mother, until they reach the age of sixteen years.
– Is that under the pension scheme or the repatriation scheme?
– It is payable from the Defence Forces Retirement Benefits Fund. I think it will be acknowledged, therefore, that the fund accepts responsibility in that regard.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
page 735
Debate resumed from 20th April (vide page 634), on motion by Senator Henty -
That the bill be now read a second time.
– The Opposition will support this bill although we must express our disappointment that it does not go further than it goes. Like Oliver Twist, we are always ready to ask for more, particularly in regard to health and social services. For instance, we regret that this bill does not give us the right to discuss the national health scheme generally. The bill amends the National Health Act in five specified particulars, but I hope that in discussing those five specific points we will be able to mention certain aspects of the national health scheme with which we are not very happy.
The first proposed amendment gives the definition of a “ contributor “ to the various medical benefit funds, membership of which is obligatory if people are to gain the full benefit of government assistance when they are sick. Of course, this is where we of the Labour Party part company with the Government. We do not believe that it is right or proper that the dispensation of money from the Commonwealth Government to the taxpayers of Australia should be dependent upon their membership of various medical benefit funds which have no direct responsibility to the Government for the way in which they raise or spend their funds. Really, the contributions are another form of indirect taxation because a family man must pay anything from £8 a year upwards to make his family eligible even for the government health benefit.
Another point about the scheme is that the amount allowed by the Government is woefully inadequate. When the health scheme was inaugurated by the Chiffey Government, which introduced legislation to make treatment in public hospitals free, the States were reimbursed to the extent of 6s. a day. Despite the terrific inflation that has occurred since that time, the payment is now only 8s. a day. That is out of all proportion to costs which have risen so alarmingly in public hospitals and all other hospitals throughout Australia. Hospital administrations tell us that the minimum cost of maintaining a bed in a public hospital to-day is £5 a day. That signifies to us all how far inflation has been allowed to get out of hand and how alarmingly costs have risen. At the time of the initiation of the health scheme, although the amount that was allowed to the States by the Commonwealth Government did hot cover the full cost of hospitalization, it reimbursed the States the amount which they had previously received from patients in public hospitals.
– Why not state the amount, which was 6s. a day?
– The cost was not exactly 6s. a day. Senator Anderson should know what was behind the original legislation. The Commonwealth Government decided to re-imburse the States the amounts which they had previously received from patients, provided that patients were not charged. Upon investigation, the reimbursement worked out at the rate of 6s. a day, which was accepted by the various State governments as being adequate for their needs at that time. We do not say that it was a very extravagant amount; but as costs have now risen to £5 a day in public wards of public hospitals, surely to goodness the amount of 8s. a day is ludicrous in comparison with the original amount of 6s. a day.
– Where did you get your figure of £5 a day?
– That is the amount which has been suggested by public hospital administrations throughout the various Australian States. That is the specific amount which was cited by the New South Wales Department of Health.
– If the person belongs to a fund he receives an additional amount.
– He definitely does, but I am not saying how much people receive from the funds; I am. saying how much the Commonwealth Government contributes towards hospital costs which have risen to £5 a day. When I deal with the pensioner medical service honorable senators will see how unfairly this position reacts on the States. The amount of 8s. a day or £2 16s. a week is all that the States receive, compared with the £35 a week which hospital administrations say is the minimum cost of maintaining a patient in hospital.
As I have said, clause 1 of the bill, which defines a contributor to the scheme, is purely and simply a machinery clause. We canT.01 disagree with it, but we do not like the basis of the contribution system. We say that it was a retrograde step for the health of this nation when the Menzies Government decided to withdraw the Chifley Government’s legislation which made treatment in public hospitals throughout Australia free. The decision to have free hospitalization was not just a matter of trying to give something to people to look after them from the cradle to the grave, as has been suggested from time to time. That decision was made because the government of that day had come to a full realization, after a great deal of mature consideration, of the necessity for keeping a healthy community healthy. When people were stricken by disease or up to that time had the shadow of death over them, as many people suffering from serious illnesses had, in many cases treatment was deferred either until it was too late or until it became much more lengthy and expensive. That aspect was stressed in our discussion yesterday of the treatment of tuberculosis. Also there was great economic loss to the nation in the number of days spent in hospital by people who would otherwise have been working economically in the community. Apart from the economic reason that Australia could not afford to have people spending long periods in hospital suffering from serious diseases, from the humanitarian point of view it was the duty of the government to assist people through times of ill health.
Up to that time there had been two sections of the public who were able to receive the very best of medical attention. There were those who were able to pay for it - the wealthy - and there were the poor who were able to go to hospitals and if their poverty was passed as being sufficiently pauperish they could receive treatment as a charity but not as a right. Between those two groups of people there was a vast group of middle-class people, such as tradesmen and salaried workers, who were faced with very large bills for hospital expenses. That was a worry to them, being honest people, until those bills were paid. The Chifley
Government’s legislation was not entered upon lightly. It was introduced after a great deal of discussion, after the main hospitals in Australia had been visited and their boards of management had been consulted, not just by the Cabinet but by a committee drawn from members of all parties and from both Houses of the Parliament. That is how the hospitals benefits scheme came into existence. We of the Labour Party regret that that original principle was departed from. Now, once again the shadow of a long sickness and the consequent expense hangs over a great part of the community. Even when persons join one of the hospital benefit funds they find that the total cost of treatment of their illness is not covered either by their contributions to the fund or by the Government.
That brings me to the second amendment proposed in the bill. It relates to multiple operations. It provides that when two or more operations are performed on the one patient the maximum amount that can be received from the Government by the doctor is the specified amount with regard to one operation and half of the specified amount with regard to another. So, if a doctor has to perform two operations on the one person he does not receive the maximum amount for each operation. It is a kind of job lot. If three or four operations are done at the one time the doctor has to do them on the cheap, as far as the Government is concerned. We do not believe in cheap labour. The schedule of payments for a doctor’s services is inadequate. After all, it costs a lot these days to acquire an adequate knowledge of surgery. The specialists who perform operations have devoted years to the study of their work, and in my view the amounts allowed to them for their services are most inadequate. A solution could be found to the problem. In public hospitals a salaried specialist surgeon and a salaried specialist physician should be available to people requiring their services. If a patient still wanted his own private specialist he could have him and pay for his services, but if a patient was unable to pay for the services of a private specialist, the services of the salaried hospital physician or surgeon should be available.
At present, we have a very fine honorary medical officer system operating in public hospitals throughout Australia. I do not think we fully appreciate the work that those honorary medical officers do. But why should they give their services for nothing? Why should they not be paid a fee for their services? Nobody wants charity. Good health is something that everybody is entitled to have, and most people would be willing to pay for medical attention if charges were reasonable. But in the last few years the cost of medical attention has got completely out of hand. To-day, expert medical attention is too costly for the average person.
As for the second amendment to the principal act, we do not think there should be any reduction in the amount of Commonwealth benefit paid where two or more operations are performed. Whether the operations are performed separately or together, the doctor concerned should be paid the rates set out in the schedule for each operation.
The Opposition has no quarrel with the Government’s third amendment to the act. The bill will empower the Director-General of Health to recover from private hospitals the amount of Commonwealth benefit they have received but have not paid out to patients who have left the hospital and whose addresses are unknown. The Director-General has a right to recover such amounts from organizations which attempt to defraud the Commonwealth.
The Government’s third amendment to the act deals with special account contributors. This is a matter that leads to considerable difficulty and controversy. It is difficult to explain the situation to pensioners who have contributed to a medical fund, and who are receiving medical benefits through their pensioner medical scheme, but who find that although they have been paying the maximum amount, they are unable to obtain the maximum benefit because they have been transferred to a special fund. I ask the Minister for Health (Dr. Donald Cameron) to look into this matter of pensioner medical benefits to see that injustice is not done to contributors to the scheme. The pensioner medical scheme is very good as far as it goes. It was not until 19SS, I think, that a means test was applied to pensioners before they could obtain a medical entitlement card. It is difficult to explain to a pensioner that because he has an income of £2 a week he cannot receive the medical benefit to which he may have been entitled prior to 19SS. Pensioners who are now debarred from obtaining a medical entitlement card because they have an income of £2 a week may have been entitled to the medical benefit prior to 1955, even though their weekly income was in excess of £2 a week.
I direct the attention of the Minister concerned to the fact that often when a pensioner fills in his claim for an age pension he is not automatically given his medical entitlement card. I have in mind the case of a man who went to the department and who, in the course of a very friendly conversation with a very friendly official, was asked whether he intended to do any work. The man replied’ that perhaps he would earn a few pounds occasionally because he did not want just to rust away. But he was not given a medical card and when his wife took ill and needed medical attention, that man had to pay for it. He came to see me. I asked him whether he had been working since he began to receive the pension, and he replied that he had not had a day’s work in that time. When I made inquiries I was told by an official that the man had said that he intended to get work whenever he could - perhaps a couple of days a week gardening. So, on the expectation that he might obtain a job and earn more than £2 a week, he had not been given a medical card. I would like to know whether the department pays regard to a pensioner’s yearly earnings or his weekly earnings. Does it inquire whether he earns £104 a year before it gives him a medical card, or does the department simply inquire whether he earns £2 a week? Anomalies exist in relation to this matter, which has created many doubts among pensioners. I sincerely trust that these anomalies will be removed.
Another instance that came to my knowledge was that of a woman pensioner who recently had the misfortune late at night to fall and break her arm. She went to her regular doctor and he told her to go to the local private hospital; that he would come there to see her as soon as he finished surgery. She went to the private hospital because it was handy to her home. She did not stay the night. Her husband took her home after her arm had been set. She received a bill from the hospital for £10 16s. which included charges for the use of the operating theatre, setting the arm and one day’s accommodation although she had been at the hospital for only a few hours. Because the attention was given in a private hospital she received no benefit other than £1 16s., which she received after a great deal of fuss. That pensioner couple could ill afford to pay more than £8 out of their pensions for medical attention after the wife’s accident. It was not as if the wife had elected to go to a private hospital for attention. The nearest public hospital was seven or eight miles away. The private hospital was only a couple of hundred yards from the doctor’s surgery, and as a matter of convenience the doctor had told the woman to go to the private hospital, where he would attend to her after he finished surgery. Because she had her ann attended to in a private hospital she received from her doctor a bill for £10 10s. That bill has not yet been paid.
Many pensioners are unable to get into public hospitals for treatment, particularly for diseases that are of a long-standing character or that are likely to result in lengthy confinement in hospital. For example, people suffering from heart disease have difficulty in obtaining hospital accommodation because the hospitals just do not have sufficient beds available The hospitals cannot afford to have their beds occupied for long periods by patients whose main treatment is rest. It is here that the B and C class hospitals, which are registered with the department in order to obtain benefits, come into the picture. There is no uniformity among the States in the licensing of those hospitals and homes.
It is time the Senate was given an opportunity to have a full debate on the national health scheme. A number of anomalies arise under the scheme, but the one to which I propose to refer now is dealt with in the Government’s fifth amendment to the principal act. That amendment provides that the Pharmaceutical Benefits Advisory Committee is to be reconstituted by increasing from four to six the representation of medical practitioners nominated by the Federal Council of the British Medical Association. The number of nominees submitted by the association for this purpose is to be increased from six to ten. The Minister will also appoint to the committee a pharmaceutical chemist, and the Minister may appoint a pharmacologist to be a member of the committee. I am quite certain that the Minister has appointed or will appoint a pharmacologist to be a member of the committee, but I think it should be mandatory for him to do so. It should not be left to his whim or wish. The use of the word “ may “ places the onus on the Minister to say whether or not a pharmacologist shall be appointed to the committee. The clause does not say that there shall be a pharmacologist on the committee. The appointment of a pharmaceutical chemist by the Minister is made from three pharmaceutical chemists nominated by the Federated Pharmaceutical Service Guild of Australia. The appointees from the medical profession are to be chosen from a panel of names submitted by the British Medical Association. In the case of a pharmacologist, it is said that the Minister “ may “ appoint. Why is the pharmacologist in a different category from the pharmaceutical chemist and the doctors, who are chosen from panels of names submitted by their organizations?
This committee, Sir, has not met very frequently. This is something that is very worrying to doctors and others who have to do with prescriptions. The formality on which prescriptions are based, and from which certain drugs are excluded, can be extended only on the advice of this committee. If a drug comes on to the market which proves to be of advantage in the treatment of a certain type of disease, and supplies of the drug are available, a doctor might prescribe it, but until the Pharmaceutical Benefits Advisory Committee meets and the members of the committee approve of that drug being included in the formulary, it is not a drug that one can get, not for nothing, but after paying 5s. for a prescription. This has caused quite a lot of confusion in the past, because a doctor usually prescribes the best drugs available for his patients. If a new drug becomes available which will assist his patient, and if that drug is included in the pharmacopoea, the doctor should be able to prescribe it. At the very least, the Minister or whoever is responsible should be able to call this committee together more frequently. He should see that it meets at regular intervals, so that doctors will know how long they will have to wait before a drug is approved for inclusion in the list. In the past, periods of four or five months have elapsed between meetings of the formulary committee.
It is rather interesting to be discussing this matter here to-night, because I remember quite well that the one point of difference between the British Medical Association and the former Labour Government in relation to its health plan apparently hinged on the existence of a formulary. At that time, the doctors said that they could not possibly co-operate with the Labour Government unless they had a free hand to prescribe what they wanted to prescribe. Is it not almost farcical that to-night, thirteen years later, the Labour Party in this chamber is advocating that the doctors should be given more freedom in relation to prescriptions? It was on that very point that the difference arose. The Labour Government accepted a formulary, based on the British Pharmacopoeia, under which 90 per cent, or more of prescriptions would have come into the category of free medicine, but the doctors said, “ We want a free hand “. The Minister insisted that drugs would have to be tried and tested over a period before they could be included in the formulary. That argument, which was pooh-poohed by the opposition parties of that day who now form the Government, is the very argument that the present Minister for Health is putting forward to bolster a case for the non-inclusion of certain drugs in the formulary.
I come to something else which is most important. I refer to the part played in any national health scheme by the Commonwealth Serum Laboratories. I have from time to time extolled in this chamber the wonderful work that has been done by the Commonwealth Serum Laboratories in Melbourne. I have been privileged at times to go over those laboratories. During the war years, I saw the work being ‘done there by our scientists, both men and women. That work was very hush-hush. Its value was not appreciated to any extent by the general public during the war years, because they did not know very much about it. Yet those laboratories provided penicillin, insulin and blood plasma, not only for our civilian population and our armed forces, but also for the forces under the command of General McArthur, those under the command of Lord Louis
Mountbatten and even those in Egypt. Today, Senator O’Byrne, who is the ViceChairman of the Public Works Committee, brought down a report by that committee in which it is recommended that very important, necessary and long-overdue buildings shall be constructed for the Commonwealth Serum Laboratories to enable them to continue the wonderful work they have done for nearly half a century in Melbourne.
Let us look at what has happened in this field. The Commonwealth Serum Laboratories pioneered the field of penicillin and insulin production in Australia. They produced these drugs and made them available to the people of this country much cheaper than they were provided by the big drug houses. During recent years, there has been an influx of drug houses to Australia from overseas. Seven or eight companies have come here from America to manufacture drugs here. That is all to the good, because we are gaining from their techniques and their skills. Three or four companies from England have started to manufacture drugs here, and they are doing very well from their activities. Millions of pounds are being paid to them. They are being more or less subsidized by the Commonwealth Government under the pharmaceutical benefits scheme. I remember that during the war years one of these companies that was in Australia at the time employed in one section of its works girls of 14 years of age to manufacture, of all things, contraceptives. In that case, a company that should have been seeking to lengthen life, to make life happy, was using the under-paid labour of little girls to make contraceptives. That is one of the companies which to-day are raking in huge profits from their sale of drugs to the Commonwealth Government. I say that the wholesale prices of drugs charged to the Commonwealth Government is absolutely exorbitant. These companies are really battening on those members of the community who are unfortunate enough to be sick, and they are using the Commonwealth Government in order to bolster their huge profits. If the Commonwealth Serum Laboratories is able to go into fields that some of these companies at present occupy exclusively, it will be able to give to the public of Australia cheaper drugs, just as it has been able to provide penicillin and insulin at cheaper rates than those drugs have been supplied by the drug companies.
It is rather interesting to note from the report of the board of directors of the Sigma company in Melbourne that it made a profit last year of just on £500,000. The report also mentioned that the company had made a large profit by selling Japanese products on the Australian market. I am not saying that; the report of the board of the company to its shareholders says that a handsome profit was made from that trade. The Australian Labour Party says that handsome profits should not be made at the expense of the sick members of the community. Of course, every one is willing to pay what is asked for something that will enable him to get well, because good health is our greatest boon, as anyone who has been ill for a time realizes. To use the sufferings of the people of Australia to enable companies which are getting the products of cheap labour countries to make huge profits in Australia, mainly through the gullibility of the Commonwealth Government in this regard is, to my way of thinking, not only wicked, but completely foolish on the part of those connected with the Department of Health. Last night we paid tribute to the Government, the people of Australia, a past Labour government, the Department of Health and others for the great advance that had been made in the campaign against tuberculosis. The eradication of that disease was a dream which fifteen years ago was thought impossible of fulfilment. To-day people are knocking on doors throughout Australia asking folk to contribute to the heart campaign. The public is becoming aware of the necessity for adequate treatment for heart disease which has become No. 1 killer in Australia. 1 have no quarrel with the system of obtaining donations from private citizens for these funds, but I think the initiative should not be left to the general public. I consider it is the definite responsibility of the Commonwealth Department of Health to take the initiative in research into heart disease and cancer - that other dreaded disease of which most people have such an ingrained horror.
There are ways in which the Commonwealth Government could really help in the national health programme. It is not just a matter of spending millions on drugs to help overseas drug companies make handsome profits. That is not the be-all and end-all of a national health programme. The national health programme exists to improve the health of the Australian community and to safeguard its birthright of good health and happiness. We of the Labour Party welcome this bill insofar as it helps to improve the present situation, but we look forward to the time when we will be able to debate bigger and better improvements in the national health service which we hope will be made truly national.
– 1 presume that as a layman rising in the Senate to speak in support of a national health bill I should perhaps speak with baited breath and whispered humbleness, particularly as, from a little inside information I have received, I shall be followed by a member of the medical profession and a member of the Labour Party’s brains trust who no doubt, being a member of the Opposition, will try to tear my statements apart. I am glad to be able to give my whole-hearted support to this bill which seeks purely to improve the national health scheme. I remind honorable senators that in this chamber on 20th April my colleague from Tasmania, the Minister for Customs and Excise (Senator Henty), who represents the Minister for Health in the Senate, pointed in his second-reading speech to the crux of the legislation we have before us now. He said -
The amendments do not affect the basic principles of the act, but are in the nature of machinery amendments to enable certain aspects of the schemes to operate more smoothly.
There are three principal amendments in this bill, each of which seeks to improve the legislation and not to alter it basically. The first amendment tidies up the definition of a contributor to the national health scheme. Secondly, the bill sets out to ease the limitation on hospital benefits from the special accounts fund. Thirdly, it amends the constitution of the Pharmaceutical Benefits Advisory Committee. It provides for an additional choice in selecting members of that committee. As well, there are several machinery clauses.
I believe that this measure illustrates the right approach by a government to a national health scheme. From time to time the Government developing such a scheme should keep it under close scrutiny and do all it can to improve the scheme for the benefit of the people of Australia. It should bring in legislation, as this Government is doing at the present time, to clear up misunderstandings and uncertainties. The Labour Party and the Liberal-Country parties differ in that the Labour Party wants the health and medical scheme nationalized whereas the Liberal-Country parties do not. The Labour Party’s present policy is a far cry from its actual accomplishments when it was in office. It is clear in the minds of the Australian people that when the present Leader of the Labour Party in the Senate (Senator McKenna), who is another Tasmanian, was Minister for Health he set out to fulfil the Labour Party’s policy. But what was the position in 1949 when the Labour Party was tossed out of office? The national health scheme was of little or no benefit to the people of Australia. In addition, to the harm to the people of Australia, the medical fraternity were at loggerheads with the Minister and with the Government, and no progress was made. The Labour Party wanted to grind into the health legislation its own narrow-minded policy of nationalization.
The present Government parties differ from the Labour Opposition in that we believe that in respect of medicine and health encouragement should be given to learning and research, and to men and women in medicine to specialize in all the varied forms of medicine, whereas the Labour policy of nationalization would do away with specialists.
– That is untrue.
Senator MARRIOTT__ The rather talkative senator opposite had the opportunity to speak for 30 minutes. The scheme that this bill amends is now ten years old. The benefits to the people of Australia in cash, kind, services and hospital treatment have increased beyond the fondest hopes of those who founded the scheme ten years ago. They have increased to a greater extent and more quickly than was expected. Why? Because the Government, the department, and the medical and other fraternities associated with the scheme, worked iri unison for the benefit of the Australian people. To-day, in spite of ten or eleven years of Labour’s opposition to and criticism of this scheme, 73 per cent, of Australian families are registered with medical benefit societies. When we add to that number the contributors who receive benefits under repatriation legislation, and the free pensioner medical benefit scheme, we realize that this Government has achieved its goal of providing for the vast majority of Australian families the benefits of a national health scheme.
What are the benefits? First and foremost is the terrific cutting down of the cost of medical treatment, hospital care and pharmaceutical goods to those who are sick or injured. Secondly, the amount that patients have to pay for medical and pharmaceutical services is cut down by payments from the Commonwealth and the ordinary medical benefit associations. Thirdly, the amount of money which the taxpayer eventually has to pay for the service he receives, which to-day is only a fraction of the total cost of that service, is allowed as a deduction for income tax purposes, as are his subscriptions to the medical benefit association. It can be said truthfully that the scheme now in operation is the envy of other British Commonwealth countries and of many countries outside the British Commonwealth. It benefits all sections of the Australian community without fear or favour.
I am glad that the Government continues to review the scheme, with the result that legislation of the kind we are now discussing is born. I can speak as a matter of personal knowledge only of the set-up in Tasmania. I understand that the Minister for Health (Dr. Donald Cameron) is examining the matter I am about to mention. I believe there should be some form of registration of specialists in that State. It is very difficult for a sick or injured person to know whether the doctor to whom he goes is a specialist. The patient may not have been to that doctor for some months or even years and he knows the doctor is a specialist only when he receives his account. Naturally, a specialist is entitled to charge more than is a general practitioner. Contributors to medical benefit funds do not receive as great a benefit from the Commonwealth or the funds when they go direct to a specialist as they do when referred by a general practitioner. I hope the Minister will be able to obtain the full co-operation of the British Medical Association in this matter.
I urge the Government, in fairness to doctors and chemists, to keep an eye on the pharmaceutical benefit list and to ensure that it is not changed unduly or too frequently. Frequent changes cause chemists a lot of worry administratively. They also cause a lot of bother to doctors, who have to examine the list frequently to see what drugs are available under the scheme. I believe the Government is keeping an eye on that aspect of the national health scheme. I trust that it will continue to watch the various associations to ensure that as far as possible they prune their administrative costs so they can build up funds to meet the expense associated with any epidemic or disease that may hit Australia.
I repeat that the national health scheme is a great advance in the social benefits that have been made available in Australia. I am so keen about the scheme that, if I have to advise widows whether or not they should continue to pay contributions to a medical benefit fund, I tell them that, if it is at all possible, they should do so. By so doing, they may choose the doctor or the hospital to which they wish to go, or to which they wish to send their children. I remind the Australian Labour Party that, when it was tossed out of office after its attempt to nationalize the banks, its spokesman said, “ When we get back into office we will scramble the eggs so that the private trading banks will not live again “. The Government’s national health scheme has been so popular and successful that I am able to say to members of the Labour Party that, if ever they re-occupy the treasurybench, they will find that we have so scrambled the eggs that Labour will never be able to nationalize medicine in Australia.
I fully support the bill, and congratulate the Government upon having improved the national health scheme.
– Mr. Acting Deputy President, Senator Marriott’s eggs were of rather mixed quality. He commenced his speech very nicely and courteously when he referred to me as being eminent in my profession. As he approached the middle of his speech, the quality of it was a little lower. Later, he raised the quality and again became gentlemanly, but he ended on a rather nasty note. It was appropriate that Senator Tangney should have spoken early in this debate, because she has long been interested in those who labour under, and suffer from, disabilities of all kinds.
Not very much time will be needed to deal with Senator Marriott’s remarks. As certain people may have heard his comments, I feel that I should refer to them. If I am wrong in what I am about to say, the honorable senator may correct me. I understood him to say that the introduction of a national medical service would mean the end of specialization in the medical profession. The experience in England has been quite the reverse, so much so that there is a surplus of specialists and younger men in their thirties are migrating to Canada and other countries. The honorable senator also said that the scheme initiated and subsequently amended by various Menzies governments has resulted in a reduction of the cost to the people of drugs and treatment. That is a wide, sweeping statement which is not backed up by evidence. One could sustain such an allegation only after conducting a thorough investigation into the incomes of the drug houses, the chemists, the medical practitioners, the hospitals and ancillary services. I make it quite clear that I have not conducted such an investigation, but I repeat that only by doing so would one be in a position to defend an assertion such as that which has been made by Senator Marriott. I agree that there should be a register of specialists. In fact, I made a suggestion to that effect soon after I was elected to the Parliament. Queensland has a register of specialists, and the conditions applicable to registration are set out in the relevant legislation. I believe T have dealt effectively with the remarks of Senator Marriott. I congratulate him upon the good parts of his speech.
The legislation now before us contains three or four basic provisions. Whether we refer to a medical benefit scheme as being a nationalization of medicine or a national health service, the maintenance of health, like education, is fundamentally the responsibility of the nation as a whole. A country such as Australia has a responsibility to provide facilities for the amelioration of suffering. Physical and mental development cannot be achieved without the provision of adequate facilities. You cannot have a healthy, happy, contented and efficient people without an efficient medical service. That is why I believe that we should have a national health service. The Government has faced up to the situation over the last four years to the extent of introducing four amendments of the Health Act. We must be getting close to the time when the legislation should be consolidated. In its present form, the legislation leads to endless confusion in the minds of parliamentary representatives, and also to pharmacists and medical practitioners and those in charge of hospitals and medical benefit funds.
I have in my hand a recent press report in which it is stated that our hospital standards are too low. We have now experienced twelve years of administration by successive Menzies governments. I do not propose to read the article. It is available to any one and my time is limited. The bill provides an enlargement of the definition of “ contributor “. There is provision for expansion of payments under special accounts. I congratulate the Government on that step. Every honorable senator opposite knows that when the Government is entitled to a tribute, I do not hesitate to pay it. I appreciate the gratitude expressed by Senator Henty in his own fashion. There is provision, which I realize is necessary for the Government’s protection, for the covering of extra charges made by hospitals for various purposes. I think that is legitimate. There is provision for an increase in the number of members of the Pharmaceutical Benefits Advisory Committee.
However, the whole question is much bigger than appears from the bill. If we are to have this patchwork business, it is questionable where we will finish and the efficiency of the services we provide will be in doubt. We must remember the fundamental responsibilities of the nation, irrespective of the fact that there are State instrumentalities administering health legislation. By and large, those bodies are in no small measure dependent on the finances provided by the National Parliament. Consequently, we have a greater responsibility. We find that the Government still discriminates between Australian citizens. This is grossly unfair and politically amoral or immoral. A benefit of 8s. a day is paid to certain people who go into hospital, 12s. a day to others, and up to £1 a day to persons who join hospital benefit funds and contribute under a certain scale. Every person in those three categories is an Australian citizen. They are taxpayers who pay in accordance with their incomes. Some may not be able to afford membership of a hospital benefit fund. Others may prefer not to join such an organization. Yet the Government persists in its discriminatory approach. How the Government justifies its attitude I do not know, lt has never attempted to do so in this Parliament.
– You will be pleased to know that I shall justify it a little later.
– The Minister will justify it? I shall supply the answer he will give. He will say that if the Government did not discriminate in this way the medical and hospital benefit funds would collapse. That will be his answer. I supply it for him in advance.
– That is not the answer.
– Then the Minister will find another one. That is the answer that has been supplied in the past by the Minister for Health (Dr. Donald Cameron). Senator Henty, as his representative in this chamber, may have something to add; but that is the answer that is provided, and it is not very reasonable. When we think in terms of drug manufacture, we think of the possibilities of the Commonwealth Serum Laboratories, what they have done in the past and what they are capable of doing. When we think of their capacity, for research and manufacture, we remember that their research work is so outstanding that only comparatively recently their leader was honoured by the award of a Nobel prize. Yet the Government is hamstringing that organization.
– It was not a peace prize, was it?
– No, a Nobel prize. The Parliamentary Public Works Committee has made a report upon this organization and outlined the great disabilities under which it is labouring. Even if the Government starts now, it cannot meet the organization’s needs. The Government has not had the foresight to act in prosperous times. It has not recognized its responsibility, or if it has done so it has been recreant to its trust or been wedded to free enterprise. Drug houses from overseas have established themselves here. Senator Tangney mentioned that they had come from America and England. She omitted to mention that they had come also from Germany. Does the Government not think that if they can come here, we as a nation could afford to expand the facilities of the Commonwealth Serum Laboratories, which have proved their efficiency through the years not only in research but also in manufacture?
Does the Government not realize that it has a responsibility in the handling of public money and that it could have saved money in this way? The operations of the laboratories have not proved expensive. Penicillin and insulin have been manufactured at a competitive price for sale on the Australian market. The Government has limited the activities of the organization by not providing sufficient funds or facilities for further manufacture. I am now informed that the Commonwealth Serum Laboratories no longer manufacture penicillin, not because they cannot do so at a competitive price but because they are overworked and adequate facilities are not available to them.
In justification of the private drug houses, we hear much about what they have done in the way of research. That is not the question. I do not quarrel with that at all. It is a worthwhile activity on the part of the private drug houses, but let us not forget that the money they use for research is provided from the profits they make from people who buy their drugs. At present in America investigations are being conducted into the monopoly practices of American’ drug houses. Their profits are in the vicinity of 1,000,000,000 dollars annually. Necessary funds for research do not come from that amount. Those are the profits after money has been spent on research. Just let us have a look at the results of research. Penicillin is cheap to-day. Why? It is because Sir Alexander Fleming and Sir Howard Florey did not ask for royalties. Those who developed subsequent antibiotics demanded royalties. That is why we continue to pay high prices for those products.
The Government will not face up to its responsibility. It must investigate the whole question if the people are to have a complete and efficient national health service. There was nothing wrong with the original scheme announced by Sir Earle Page, although 1 should have liked it to be more complete. lt fitted in with the ideology and principles of the government of the time, lt was a contribution to the welfare of the people. It did represent something; but now the Government is gradually whittling it away in many respects, more particularly by the imposition of a charge for pharmaceutical benefits. I am. certain that Sir Earle Page, an eminent medical practitioner, never visualized that a charge would be associated with the scheme. He realized that in time the number of drugs available would increase and that the scheme would be elaborated. He appreciated its value to the community in the form of a reduction in mortality rates, a decrease in disability, a shortening of periods of disability, an increase in productivity, and an increase in incomes, with a consequential increase in taxation revenue to the Commonwealth. Subsequent governments and the present Minister for Health have not seen fit to follow in Sir Earle Page’s train. Charges have been imposed with the expansion of the scheme. I think that has been to its detriment. We think of the services that should be rendered, but are not rendered, by the Government in the field of mental health. The Government has a stereotyped answer, which it gives whenever it seeks to shirk responsibility, as it does so often. It simply says, “ That is a matter for the States “.
When conditions in regard to mental health in Australia became acute, the Government discharged its obligations in a mean, miserable fashion. It had Dr. Stoller appointed, and having had his report in its hands, it said, “ We will advance £10,000,000 towards capital structures if the States advance a further £20,000,000 “. There was no contribution towards the cost of maintaining the unfortunate patients. The Government will not even contribute 8s., 12s. or £1 a day for that purpose. I think that that is a disgrace in these enlightened days when we accept mental disease as merely a particular form of disease, and as no more to be ashamed of than other forms of disease. Yet, in the case of pensioners, who are admitted to mental hospitals, this Government sees fit to take away even the pennies. As my colleague, Senator Courtice, says, the Government is so miserable that it takes away the lOd. a day contribution that used to be made.
– Not the whole lOd.
– You have been mean enough to take most of it.
– You were so miserable that you would only give them lOd.
– And you are so miserable that you will not let them keep it.
– We gave £10,000,000 towards their accommodation.
– Because you could not do anything else. You were faced with the problem of overcrowding in the other hospitals.
– We brought Dr. Stoller out here.
– You did not bring him out here. He was here all the time. Do not try to mislead the public. Dr. Stoller is an eminent Victorian psychiatrist. He was brought in to make a report, and he advised the Government that there would be a shortage of 25,000 beds by 1965. We are now in 1961, and the contribution you people have made would not provide for more than approximately 8,000 additional beds. Consequently, there is no possibility that the needs of the people, as visualized by Dr. Stoller in his report, will be met.
We have the position, which the Government has not faced, that there is overcrowding in hospitals. It seems to me that it is time for the nation to face up to this question. The States may be to blame. So long as they are able to admit patients to hospitals, they are quite happy to do so. They are not concerned so much with the facilities that are available or, with the standard of service. Just as the Government brought in Dr. Stoller to investigate the need for research, accommodation, treatment, the training of graduates, and so on, in the field of mental disease, so too should the Government act in relation to other fields of disease and the general hospitals. If it is true - and I have no reason to doubt it - 1 that our hospital standards are too low, then the Government, even with its miserable financial approach to the needs of the States, is not ensuring that the people receive value for the money that is spent.
The Government has a responsibility in this regard, even when it contributes a miserable 8s. a day per patient, as it did for patients in Queensland public hospitals, or 12s. a day for patients in some cases, and £1 a day for those who contribute to the higher schedule of hospital benefits. Apparently, the Government thinks that it has discharged its obligation simply because it makes a payment. It is not concerned with the services that are provided, nor is it concerned to ascertain whether the standards are reasonable or too low. It is not concerned, either, with the fact that there is overcrowding in the hospitals. It is the responsibility of the Government, not only to distribute public money, but to ensure that there is provision of reasonable facilities for medical treatment. On no occasion has the Government attempted to do that.
In the field of industrial medicine, very little has been done by this Government. It has done little in the way of research. Senator Tangney referred briefly to the National Heart Foundation, which is seeking £1,500,000 from private sources. What did the Federal Government do for the foundation? In its munificence it gave the foundation £10,000 with which to launch its appeal, and not another penny. Judging by the Brisbane municipal elections and various Queensland by-elections that have been held recently, the Government will not be in office after the next general election, and it will be a good thing for the nation and the people if it is not. Does not this Government realize that research in cardio-vascular disease not only assists the people whose health is improved as a result of such research, but also leads to an increase of industrial efficiency and productivity? Does the Government not appreciate that in the train of such research comes increased revenue front taxation, which means a better standard of living for the community generally? Government supporters are so limited in their vision that they will not face up to these major problems.
– You are becoming somewhat personal, are you not?
– I am speaking collectively, not individually. I suppose some of you are decent enough individually. I have pleaded with the Government to do something in the field of dental care. I think that a responsibility rests on the Minister for Health. I do not know why he has not taken action, particularly as he was a capable medical practitioner. Why will he not do something about this matter? I know that there are difficulties associated with it, such as finance and so on, but surely he could ensure, as I have asked him repeatedly, that free dental attention is provided for children under the age of sixteen years. That would not be costly. The dental profession has promised cooperation. It will even agree to the employment of dental hygienists, or trained personnel who are not fully qualified dentists. Therefore, this service would not cost such a great deal.
The Government has failed to do the things I have mentioned, and the one to be most berated for that failure is the Minister for Health because he is the man who should really know of the need for them. He should know that if you improve medical services and improve the physical standards of the people, you must also improve efficiency and productivity. I am discussing this matter not from the humanitarian, but from the purely material, aspect. Why will not the Government face its responsibilities in this respect? Is it because it is not interested in people? Have the Government parties merely been interested in the retention of the Treasury bench? Is that why they have adopted catch-cries, as they did in 1949? Have they been concerned only with retaining power to serve the people who have assisted them? That is what it looks like, to my way of thinking. The Government has made no real endeavour to improve health standards. It speaks of the medical benefit scheme, but it has imposed a financial burden on the people, in many cases a burden which they cannot support. Nevertheless, they must try to do so because they cannot afford to do otherwise, having regard to the possibility of their incurring high medical and hospital costs. You are gouging it out of them, to put it crudely. That is the position so far as a large percentage of contributors is concerned.
– You are back in the Mount Isa days with this “ gouging “.
– You people are not bad gougers either when it comes to taking money from the poor people. A large percentage of Australians have to join hospital and medical benefits funds simply because they cannot afford to be out of the funds.
– That is fair enough.
– How callously cruel is that interjection. The honorable senator does not care whether these people can afford their contributions or not. That is the most callously cruel interjection I have ever heard in regard to people who cannot afford to bear the financial burden of medical treatment. I am surprised at you, senator. I hesitated to address you by name because ordinarily you are so decent.
– You can do so; I do not mind in the slightest.
– The position is that people cannot afford to contribute to the funds, yet they have to be in the funds because they cannot afford to pay £30, £50 or £100 when they or members of their families desire the attention of a particular doctor or seek to enter a particular hospital. Consequently, the time has long passed when the Government should face up to the responsibility of consolidating the act. It should also face up to a complete investigation of the health of the people of Australia. It should accept its responsibility for a national health service. It should expand rapidly the activities of the Commonwealth Serum Laboratories and establish similar organizations in States other than Victoria not only for research purposes but also for the manufacture of drugs. The Government should provide free dental attention for children under sixteen years of age. It should face up to the responsibility of an expansion of industrial hygiene. It should accept a real responsibility for the provision of modern treatment and care of people suffering from mental diseases. Those are just a few responsibilities that the Government should accept.
But all it does is come along with a few tinkering amendments which, as its own Ministers said here and in another place, are merely machinery amendments. Although this matter is so vital to every man, woman and child in this country and so associated with disease, disability and mortality, the Government comes along with a bill which merely contains machinery amendments. Surely the Government is better and bigger than that. Do not honorable senators opposite think that in a matter such as this the Government should accept its fundamental responsibility at least ir» this way. If it cannot discharge its responsibilities in the international sphere, at least on this occasion it should try to act with a sense of national responsibility and not seek to shelter behind the claim that this is a State responsibility. I urge the Government to accept the health of our people as a national responsibility.
– We have just been treated to the most extravagant nonsense that I have ever heard in relation to an amending bill. This bill amends the principal act in five respects. Yet we have been taken all round the world and have heard all the nonsense that one could ever hear. As a matter of fact, all sorts of red herrings have been drawn across the trail. We have heard about the private drug houses which have nothing whatever to do with this bill. We have also heard about victimization and all sorts of things which are not in any way related even to the National Health Act, apart altogether from being related to this bill. Senator Dittmer talked about discrimination. He said that we are discriminating because we contribute 8s., 12s., or 16s. But there is no talk of discrimination about the 8s. or 12s. for pensioners who receive free hospital treatment. Is that the sort of discrimination of which we are being accused? The honorable senator did not mention those things but merely indulged in statements which, as a medical man, he knows are just not true. He reminds me of the man who went to a doctor to receive attention to his toe and the doctor took all his teeth out. That is the sort of extravaganza that we have heard.
This bill simply amends the principal act in five respects, but this debate has been allowed to run completely free. Senator Tangney, who led for the Opposition, has used this occasion to attack the broad principles of free medical treatment and free hospitalizaton. As one who has some know ledge of this matter, I say that the provision of free hospital and medical benefits was probably the greatest piece of legislation that has ever been introduced for the benefit of the Australian people. Who will deny that by introducing the free medical and hospital treatment scheme the Government has given the people of Australia an independence which they would never have had if we had the socialist health scheme which the previous Labour Government tried to jam down our throats? Is it not a fact that the Labour Government, of which many honorable senators opposite were members and supporters, tried to introduce a hospital and medical scheme and the doctors of Australia would not have a bar of it?
– And the people would not have it either.
– That is so; it fell fair on its face. The reason was that under that scheme Labour was going to do all the things that Senator Dittmer mentioned to-night. Every conceivable thing was going to be thrown in. Honorable senators opposite forget that Australia has only 10,000,000 people, that Australians have only a certain amount of money and can pay only a certain amount in taxation. Whether the Opposition likes it or not, we know that we have in Australia a health service equal to any in the world; and we have independence.
– Are not the people paying for it now?
– You are getting more like a magpie every day. Please be quiet.
– The people pay for it.
The ACTING DEPUTY PRESIDENT (Senator Pearson). - Order! The honorable senator has made his speech.
– Senator Dittmer had a good go. Under great pressure i listened to him in silence. He must realize, as everybody else realizes, tha: we have a system which provides complete freedom of choice in regard to medical benefits and complete freedom to go to any doctor or hospital we choose. The proof of the pudding is in the eating, and statistics prove that about 75 per cent, of the Australian community are in medical and hospital benefits funds. The plain fact is that since the introduction of hospital benefit funds hospitals have been paid their fees whereas in the past they were not paid. Because the hospitals are being paid their fees they are able to give a better service to the community.
What is the alternative to the present scheme? Are we to have this socialist dream - the system that neither the people nor the medical profession would have a bar of? Because it is a dream, it keeps coming up. When Senator Tangney led for the Opposition, she referred to the definition of “ contributor “ and proceeded to criticize the broad scheme of hospital and medical benefits. But her remarks had nothing at all to do with the bill. The plain fact is that this is simply an amending bill which makes certain very limited and circumscribed amendments. The first is in regard to the definition of “ contributor “. Then there is an amendment relating to special benefits in hospital and medical benefit funds. Surely we are all on common ground that hospitals should be permitted to charge for services they provide for people so that they can provide good hospitalization. We all know that a person can join a fund and receive not only good hospitalization but also a certain sum of money on being discharged from hospital to help him to pay the outofpocket expense he will naturally incur in the community, in his domestic life and in going to the hospital. This is a form of insurance which the people of Australia have indicated they want. . Seventy-five per cent of the people of Australia are members of funds, so they have indicated that they want it. When we add to that 75 per cent the pensioners who do not need to contribute to a fund, it means that the great majority of the Australian people are in the hospital and medical benefits scheme.
– They cannot afford not to be.
– To suggest that they cannot afford not to contribute to a medical or hospital fund is sheer nonsense. Honorable senators opposite are getting back to the old socialist idea of socializing everything. Under their system people would go to the doctor to whom they were told to go. That is what the Opposition wants, but it is not what the people want. The people of Australia have indicated that the scheme introduced by this Government is fair and proper in their view.
It should be remembered that the Government provides about £25,000,000 a year for free medicine. ‘ To listen to Senator Dittmer one would think that the Government was not contributing anything to the cost of hospital treatment. Yesterday, I initiated a debate in this chamber during which every speaker agreed that in the last twelve years or so something like £68,000,000 had been provided by the Government to combat tuberculosis. Every speaker in that debate agreed that that was a very wonderful contribution. But listening to Senator Dittmer to-night one would think that the Government had not provided one shilling. The honorable senator seems to want the Government to be extravagant, but that was not the purpose of this amending bill. To-night, we heard a member of the Labour Party brains trust blackguarding the Government and saying that it has provided nothing for hospital and medical treatment.
– I rise to order, Mr. President. I did not blackguard the Government, and I object to the honorable senator’s use of that phrase in reference to me.
The PRESIDENT (Senator the Hon. Sir Alister McMuIIin). - Order! Senator Anderson may continue.
– I withdraw the phrase. I did not mean to be personally offensive. I will use another and equally effective phrase. Senator Dittmer sought to detract from the character of the Government. He chided the Government.
– You do not suggest that Senator Dittmer is a member of the brains trust, do you? He said that himself.
– I warn the people of Australia. They should know what they will get from the brains trust of the Labour Party.
I am a man of peace, but it distresses me to hear an honorable senator, who is a member of an honorable profession, suggest that the Government’s record in the field of health is not good. I say that the Government’s record is magnificent. The people of Australia recognize that its record is magnificent. The fact that the people have joined hospital and medical funds is an indication that they cherish their freedom. They do not want nationalized medicine.
The Opposition knows that the people do not want nationalized medicine, but it will ram nationalization down the throats of the people just like bad medicine, because nationalization is part of Labour’s doctrine.
Having, been in concert, as it were, with Senator Dittmer for the past few minutes I turn now to deal with one or two aspects of the amendments contained in the bill. I want to deal with the amendment which provides that the Pharmaceutical Benefits Advisory Committee shall be increased in number. All honorable senators, on both sides of the chamber, have at times been asked to use their endeavours to have certain drugs added to the free list. It is a natural tendency for people, on the advice of a medical practitioner, to seek to have particular drugs included on the list. I have had that experience. I have made representations to the Minister for Health at times, and I have been told by him that although a doctor may have prescribed a certain drug, he could have prescribed other drugs that were included on the free list. As members of Parliament with a sense of responsibility we know that there must be some limit to the number of drugs included on the list. Australia’s population is small. There is a limit to the amount of taxes that we can pay. Some control must be exercised. We do not want this matter to get out of hand, as it did in England.
I want to tell ‘the Senate a very human story. I am sure that it will appeal to honorable senators. I am a director of a charitable organization that provides assistance for people in need. That organization is the Food for Babies Fund and Good Samaritan Association. The organization was confronted with the case of a child - only a baby - who was diagnozed. as having some subnormality of the brain. The medical people said that a drug existed which, they believed, could possibly relieve the situation and give the child a chance to lead a normal life. An older child in the family had suffered from the same complaint, and the medical people thought that nothing could be done for that child, but they believed that if the younger child were treated with the drug in question there was a chance that it could lead a normal life. The drug cost about £7 a bottle. The child’s parents were ordinary folk. They were not in the high income bracket, and they could not afford to pay for the drug. The organization of which I am proud to be a member undertook to pay for the child’s treatment. The organization continued to pay for that treatment for some time, and when the drug became unobtainable in Australia it was imported from America. The cost when imported from America was about £10 a bottle, and each battle lasted only a few days. Ultimately, the organization made representations to the Minister for Health and the matter was referred to the Pharmaceutical Benefits Advisory Committee. In time the drug was added to the free list. Quite obviously no charitable organization could afford to continue to pay £7 or £10 a week for one particular case. Because the drug was not available in any other form, and because there was a chance of its saving a child, it was added to the free list. To-day, that child is receiving treatment through instrumentalities in New South Wales, and my organization has been told that there is a distinct possibility that when it reaches the age of six or seven years it will be leading a normal life. I merely tell that story to point out that all of us have at times had to make representations to the Minister that certain drugs be added to the free list. Nevertheless, we must realize that we cannot have everything on the free list. A degree of judgment must be exercised. The committee consists of representatives chosen by the British Medical Association, and they will see that justice is done. The bill will increase the membership of that committee in order to make its operations more effective.
I wish to deal with only one other amendment to the act. This is a matter to which Senator Tangney referred. She claimed that doctors were doing operations in job lots, for which they received only £22 10s. The point that was not made - I do not think Senator Tangney omitted this point with any idea of confusing the issue - was that the £22 10s. is the Commonwealth contribution only. The doctor does not do these operations for £22 10s. only. The £22 10s. is the Commonwealth contribution, and on that basis the doctor’s fee would be sixty guineas. The patient does not pay any of that sum. If the patient is a member of a fund he pays his contributions in the normal way, and the doctor gets £22 10s. from the Commonwealth and a supplementary amount from the insurance fund, bringing his total fee to sixty guineas. The point I am making is that it is not a matter of a doctor performing operations in job lots, as the statement to which I have referred implied. I agree with Senator Dittmer’s statement that it would be rare indeed for more than one operation to be performed on a patient in respect of the one illness.
I now advert to the point I made at the commencement of my speech. This is only a small bill, in that it effects four or five amendments to the principal act which are not controversial or party political. I regret that perhaps I have directed my attention to certain aspects of it at length - certainly Senator Dittmer did - and that the debate has been turned into a bit of a shouting match. In the final analysis, the National Health Act has provided a wonderful service, a free service, to the people of Australia.
– It is not a free service.
– When I say a free service, I mean it is free in the sense that a patient has freedom of choice in relation to the doctor he wants to attend to him; he does not have to go cap in hand to any socialist-controlled organization. Patients are also able to exercise a free choice in relation to hospitals and medicine. I have much pleasure in supporting the bill.
.- The title of this bill is the National Health Bill 1961. Therefore, I cannot agree with Senator Anderson’s contention that in considering the measure we are not entitled to discuss national health. If we are to be pinned down to one or two machinery matters, the bill should have been called a bits-and-pieces bill. We would then have known where we stood. I share the disappointment of other honorable senators that the Government continues to dodge the necessity for a national health scheme. People who have come to Australia from overseas countries during the last ten or fifteen years have said that they were given the impression before coming here that Australia was a socially progressive nation. They have told me, as they have probably told others, that they are amazed that in a nation which makes a claim to be socially progressive there is no adequate national health scheme. Many people who have come here from overseas - people of experience, in many cases professional men - have been in countries whose national health schemes were implemented in a way that was satisfactory to everybody concerned.
The bill contains provisions in relation to benefits provided by a registered medical benefits organization to which persons may desire to contribute for that purpose. I have always believed in the adage that prevention is better than cure. I believe that a good deal of the money that is provided for national health is wasted while a situation continues in Australia in which it is absolutely impossible to provide adequately for the dental health of the community. For that state of affairs, this Government must accept some responsibility. Not very long ago, a survey was conducted in order to compare the dental health of children in Australia with that of children in New Zealand. This is an important aspect of the matter because under this legislation parents in Australia are obliged in some instances to expend money in the interests of the health of their children. It is well known that if teeth are not adequately cared for the foundation is laid for an infinite variety of diseases that afflict the human body. It will probably come as a shock to many honorable senators to learn that according to medical opinion the incidence of tooth decay among Australian children is almost the highest in the world.
We have been told that people dig their graves with their teeth. In the “Australian Dental Journal “, of June, 1959, there is an article which compares the dental health of children in Australia with that of children in New Zealand, and I believe that the conclusions drawn in the article are appalling. It reads, in part - there are significant differences in the standards of dental care in school children in Australia and New Zealand. Over the age range seven to fourteen years, Australian school children have about five times as many unfilled decayed teeth, half as many fillings, and seven times as many extractions as New Zealand school children . . Australian school children have a tooth fatality rate of 10.9 per cent., while the New Zealand rate is 1.78 per cent. . . . According to figures supplied by Australian dental health authorities, not more than about 20 per cent. of Australian school children receive State dental care, while the figure for New Zealand is about 95 per cent. … In Australia malocclusion of some degree is observed in 80 per cent, of children.
The position in Australia to-day is that four-fifths of our children are suffering from very serious dental illness, and there is very little possibility of adequate dental treatment being provided for them. As I have mentioned, doctors have said that we are digging our graves with our teeth. Yet the bill which is brought forward only seeks to plug a few small holes and does nothing to overcome the major problem in connexion with the health of the community.
What is the situation in Australia to-day in relation to care of the teeth? It has been said by dentists that a desirable ratio to be maintained in Australia would be one dentist to 2,000 people. I have before me figures in relation to the position in the Australian States in 1958. In Tasmania, there was one dentist to 3,400 persons, and the position has since got worse; the ratio now is one dentist to 5,600 people. How can the dental health of the people of Tasmania be adequately attended to? In South Australia, in 1958, there was one dentist to 2,800 people; in Western Australia, there was one dentist to 2.600 people; in Victoria, there was one dentist to 2,500 people; in Queensland, there was one dentist to 2,200 people; and in New South Wales, the only State that has an adequate number of dentists, there was one dentist to 1.800 people. The Victorian figure has since slipped. Victoria is now well behind. In that State to-day, there is one dentist to 2,800 people. The number of dentists being trained in this country is completely inadequate, and we have now reached an extremely difficult situation, because a considerable number of dentists who have been trained in Australia have gone to England, where they can get a better deal, a better return, under that country’s national health scheme.
Let us look at the situation in which dentists who are essential to maintain national health are leaving this country. In England, the ratio of dentists to the population is one to every 1,400 persons. In that country, under a service controlled by the Government, there is a shortage of dentists, but that shortage is by no means as acute as is the shortage in Australia. The English dental schools are not able to train the number of dentists required, with the result that vigorous efforts are continually made in the recruitment of Australian dentists to go to England. If an Australian dentist wants to leave this country - and already there, is a grave shortage of dentists here - he is attracted by the offer of business firms that trade with dentists of 100 per cent, finance for his practice or for his private housing. He is able to set up in practice with no capital outlay and no housing worries, and the amount of money he will earn in Great Britain will be equal to, and in most cases more than, what he could expect after years of practice in Australia.
Recently I asked the Minister representing the Minister for Health whether it was a fact that in one year 170 Australian dental graduates - irreplaceable and essential to this country - had gone to Great Britain. The Minister informed me that the number was not as large as that. All I can do is quote from the “Australian Dental Journal”, for October, 1960, at page 329, where the South Australian branch of the Dental Association reported -
There are about 900 Australian dentists practising in the U.K., and about 170 graduates left Australia last year.
How are we going to provide, for the health of the community, when Australian children are receiving almost the worst dental treatment in the world, when the number of Australian dentists is completely inadequate to meet our requirements and when dentists are being induced to leave this country in large numbers as soon as they are qualified, because of the greater rewards which are available, elsewhere? Under those circumstances, I say simply that if we are going to talk about national health, we should have a serious look at the dental situation in this country.
I know that there are people who say that most parents can get a child to a dentist eventually, but as a parent of four children I should like to ask: How many parents to-day are able to afford the fees being charged for dental treatment? Honorable senators know that a large number of parents in this community do not give their children dental treatment, because they cannot afford to pay the bills. In places like New Zealand and Great Britain the superior standards of dental health in the children will be reflected in the improved health of the community in later years. The standards have increased because of the greater number of children treated, and the number treated is greater in those countries because dental treatment does not impose the same financial burden on parents as it does in this country. Because children in New Zealand, Great Britain and some other countries receive dental treatment which children do not get in Australia, the position in those countries is rauch better than it is in Australia.
In New Zealand eighteen teeth are filled for every one extraction. In Australia 1.3 teeth are filled for every extraction. Those figures demonstrate that the teeth of Australian children are being lost to them. In Australia, through governmental and free channels, only 20 per cent, of the children are receiving adequate dental treatment, whereas in New Zealand 95 per cent, of children are receiving adequate treatment. Those figures show that, in the matter of dental health, our children are under-privileged. They are not getting their due. I express my disappointment that when national health is being dealt with, a bill is brought down which merely plugs a few unimportant holes and leaves the dental health of the community entirely untreated.
When I asked a question of the Minister for Health some weeks ago on the subject of dental health, I received an answer. I have always found the Minister to be courteous and anxious to oblige in his answers to questions. This case was an exception. His answer was evasive; it did not pinpoint the fact that the dental health of this country is entirely unsatisfactory. The Government must know that dentists are being taken from Australia at a time when our supply of dentists is completely inadequate. It must know that dentists are being attracted abroad. Why does not the Government admit the fact and do something to arrest this flow, which is militating against the future health of our community? It seems to me that the Government is reluctant to tackle the subject of dental health. There are rumours that the Government is considering a scheme to provide for the repayment, through nongovernment sources, of fees for certain types of treatment. Such a scheme ignores the fact that the primary need in Australia to-day is to put our children on the same basis as those in other great Dominions in regard to the treatment of teeth. I repeat that the incidence of tooth decay amongst Australian children to-day is almost the highest in the world. Eighty per cent, of Australian children require orthodontia - which is special treatment from the dental point of view - yet, in spite of that, governmental and semi-governmental bodies are able to cater for only 20 per cent, of them.
Seeing that in the seven to fourteen years age group Australian children have five times as many unfilled decayed teeth as New Zealand children, half as many fillings and seven times as many extractions, there seems to be some justification for demanding the inclusion in the Commonwealth Budget of provision for adequate dental care for our children. The present Government could have found out these facts several years ago, if it had been interested. Now that the facts have been placed before if, I should like to know whether the Government intends to continue plugging up the little holes, or whether it intends to do something serious about this health threat to the community.
What can the Government do? Firstly, I suggest it should embark on a scheme at once of helping to train an adequate number of dental graduates. Immediately after the recent war there was an increase in the number of people who graduated in dentistry, because the Government gave financial assistance to ex-servicemen who wished to qualify as dentists. Apart altogether from that aspect of the matter, the Government should treat dental health as a serious problem. It should provide the Australian people with an adequate number of dentists and with adequate provision for care of the teeth. I suggest that the Government should have a look at a recent report issued in Great Britain. I refer to the Spens report on the dental profession. This report has been acknowledged world wide as an authority on matters affecting the dental profession. It covers the training of graduates, the expenses of practice, the expenses in reference to sickness, accident and age, capital and many other matters. I suggest that dental health is such a serious problem that the Government must tackle it
I should like to see, perhaps, a select committee of the Senate appointed to look into the situation. I hope that the problem will not be left undealt with and untouched. I repeat that to talk about providing hospital benefits for people when many who need those hospital benefits need them only because they did not receive adequate care of their teeth in their childhood is just plain foolishness. There is much talk to-day about the necessity for prevention rather than cure. Everybody freely admits that many diseases can occur in later life as a result of inadequate dental attention earlier, but in this country we have one of the lowest standards of dental treatment for our children in the world. When one considers that, one can only be alarmed.
I repeat that I am disappointed that the Government has brought in another national health bill which does not deal with national health. The title of the bill is a misnomer. Really we are not trying to deal with national health; we are only plugging a few gaps here and there. I have directed attention to the state of dental health in Australia, and I ask the Government what it proposes to do about the matter.
– The remarks of Senator McManus were very interesting. I point out, however, that the bill provides for only one or two minor amendments, and that we are not considering the national health legislation in its entirety. Even though the honorable senator’s remarks may have seemed to him to be important he got quite away from the subject-matter of the bill. Senator McManus was very particular about quoting certain facts; but he did not indicate the state of the teeth of the people of New South Wales, where, he admits, the number of dentists available is adequate for the needs of the population. He referred to South ‘Australia. The results of dental surveys conducted years and years ago are to be found in the records of the Parliament. It is worth noting that dental decay occurs to a greater degree in the homes of people who are well off financially, and who can pay for dental service.
This debate has ranged over the whole of the national health legislation, but I point out again that the measure now before us is designed to make only a few minor amendments to the principal act. Every honorable senator opposite who has spoken so far has pointed out the alleged deficiencies of the national health legislation, but omitted to say that when Labour left office there was no national health scheme in operation. As Senator Anderson said, Labour could not implement a national health scheme.
– It was beyond them.
– Exactly. Now that a national health scheme has been introduced, it is quite easy for Opposition senators to criticize and to ask for lavish things to be done. Senator Dittmer, who is not now in the chamber, made certain points in his speech. But all I wish to say about him is that I have come to the conclusion that he has been vaccinated with a gramophone needle.
– It must have been a rather rusty needle.
– I agree. Senator Dittmer said that I made a terrible statement when I said I believed it was the fundamental duty of the people themselves to contribute something towards the maintenance of their own health. We on this side of the chamber believe that people should have a little bit of back-bone. When this Government assumed office, the finances of most Australian hospitals were in a bad state. But this Government has made payments to the hospitals, and most of them are now much better off than they were previously. The Labour Party made inadequate payments to the hospitals when it was in office. But even now when hospitals are being reimbursed in a manner that assists them to improve their finances, honorable senators opposite still find fault with the Government.
The first amendment in the bill deals with the definition of a contributor. It is on this point that the Government and the Opposition disagree. We on this side of the chamber believe that people should contribute for health benefits; but Senator Dittmer and every other Labour senator who has spoken have said that it should not be necessary under a national health scheme, and that people should not have to contribute to a medical benefit organization in order to obtain the Commonwealth benefit. The Opposition wants the whole of the medical profession and our hospitals to be nationalized. The opportunity for people to contribute to a medical benefits organization and thereby qualify for a Commonwealth benefit is one of the best things that has been provided for the people of Australia. As Senator Anderson said, people who contribute to an insurance organization under the existing scheme have the right to choose their own medical practitioner, and to choose the hospital in which they are to be treated. The statistics show, as the honorable senator also pointed out, that between 70 and 73 per cent, of the people contribute to the various medical benefits funds. When we take into consideration those who benefit under the pensioner medical scheme, those who receive repatriation benefits and those who receive various other hospital benefits, it can easily be seen that almost every one in Australia is entitled to a national health benefit.
We know that the States are responsible for the administration of hospitals. I do not suppose the States would be prepared to hand over the control of their hospitals to the Commonwealth, because they guard their State rights jealously and claim that the administration of hospitals is their prerogative. What the hospitals charge and whom they charge is their own business. It is interesting to note just how much money has been paid in the form of hospital benefits. Last year, the Commonwealth contributed approximately £18,500,000 for hospital treatment, and that contribution attracted a further payment of £12,000,000 from the various benefit funds. So last Vear, directly and indirectly, the hospitals received at least £30,000,000 as a result of the operation of our national health legislation. It is of interest to note also that the States may allocate to their hospitals in any manner they wish funds they receive from the Commonwealth under the Commonwealth and States financial agreement.
The other amendment to which I wish to direct attention relates to the matter of special accounts. It is true that one clause in the bill places a limitation on the total benefits that may be provided under the special account procedure. If a contributor is transferred to the special account, he is not really put at a disadvantage. In fact, many people receive extra benefits in this way, particularly after what I like to call the 91-days period. After thirteen weeks, variations in the payments occur and the patient receives payments from the fund. If he is unfortunate enough to be hospitalized for twelve months, at the end of that time he reverts to the original rate to which he was entitled. For those unfortunate people who need long hospitalization, the special account has been of great benefit.
The only other matter upon which I wish to comment relates to the Pharmaceutical Benefits Advisory Committee. More doctors are to be added to the committee. Their names are to be selected from a par.el submitted by the British Medical Association. One member of the committee will be a pharmacist of the Commonwealth Department of Health selected by the Director-General of Health. The Minister will appoint six medical practitioners from ten nominated by the federal council of the British Medical Association and a pharmaceutical chemist from a number nominated by the Pharmaceutical Services Guild of Australia. The Minister may also appoint a pharmacologist to the committee. The proposed increase in the size of the committee is good. The inclusion of more doctors is necessary, as I think every honorable senator will agree, because almost every day new drugs are coming on the market and if a proper selection is to be made it is necessary to have a wide range of people with practical knowledge of the efficiency of these drugs. Of course, there must be delays in the addition of new drugs to the formulary. The drugs have to be tested and tried, and only clinical experience can determine whether they should be included in the free list. Time for testing is essential. The inclusion of drugs in the formulary is a vastly complicated question. It is necessary to avoid confusion as much as possible. The only other point to which I wish to refer is in relation to the names of the persons comprising the panel. I know that pressure has been put on the Minister and on members and senators to divulge those names. I agree that the names should be kept secret. We know the pressure that can be exercised by business interests yi an effort to peddle, if I may use the term, their own line of drugs. 1 support the bill and agree that it is designed to make the national health scheme even better than it is to-day. I know that nobody is more concerned with the health of the Australian public than are the Government and its supporters. I can assure honorable senators opposite that when the appropriate time comes for a complete review of the national health scheme many of the remarks made to-night will be more appropriate. I do not say that all of the remarks were accurate. This Government is fully alive to the importance of the people’s health and it has done much to improve the national health scheme. At all times it will do whatever is possible in the best interests of the people’s health.
– I have listened very carefully to statements made by Government supporters. When they were not congratulating the Ministry, as members of a mutual admiration society, they stooped to any untruth, half-truth or inaccuracy to boost the Government’s actions. Senator Anderson told us that when Labour went out of office in 1949 we had nothing like the present scheme. Senator Mattner just repeated that statement.
– I meant every word of it. That is absolutely true.
– Senator Mattner was in this chamber prior to 1949. He knows that throughout the length and breadth of Australia a free hospitalization scheme, introduced by the Australian Labour Party, was in operation. Yet tonight he said that nothing like a national health scheme was then in operation. A contribution of 8s. a day for every occupied bed in hospitals was introduced by the Labour Government. The contribution continues at that rate under this Government; it has not been increased. Government supporters repeatedly make inaccurate statements such as that made by Senator Mattner. He knows that a free medical scheme was in operation.
– You could not get the doctors to work for you.
– You have had your say.
– No, I shall have it in a moment.
– For twenty minutes the Minister will abuse the Labour Party and its members in this chamber and he will not prove anything. He knows that I am correct in saying that a free supply of medicines was available throughout Australia. These drugs were in a formulary, about which the British Medical Association quarrelled with the Government, and particularly with the Minister for Health, who is now our leader in the Senate, Senator McKenna. Notwithstanding that quarrel, doctors throughout Australia were working on the formulary provided by the Government. There was free hospitalization, not the kind of hospitalization that exists to-day. There was free medicine in accordance with a formulary which was a bone of contention with the British Medical Association. So far as I can see, the Government’s health scheme has been manipulated to an unreasonable degree. Those who cannot really afford to pay are being made to pay for health services. The people have to struggle to pay for medicine, hospital treatment and medical attention. The Labour Party had in mind an entirely different scheme.
When Labour was in office, prior to 1949, the then Opposition ridiculed the idea that Labour could inaugurate a national health scheme. We were laughed at and told that our ideas for the provision of a preventive health service, including the provision of medicine, hospital treatment and medical attention, were absurd^ and that we were, in effect, dreamers. This Government ha9 adopted much of our scheme. I am glad that it is coming our way, at least so far as national health is concerned. The Government would never have thought of a national health scheme had it not been for the scheme envisaged by the great Australian Labour Parry. But for that, there would be no health scheme to-day other than that of the friendly societies. Even so, the Government isemasculating the ideas of the Labour Party in regard to national health. The people are being forced to contribute to huge medical benefit societies that are controlled by doctors - British Medical Association men. The societies have palatialoffices in Sydney, Melbourne and the other capital cities, as well as in some of the provincial cities. These offices have been paid for from funds that are supposed to be accumulated for the benefit of contributors. Money is thus being spent for the benefit of people who, in some cases, are shareholders in the societies concerned. In this respect, I exonerate the friendly societies and lodges, because they were operating in the field of medical benefits long before this Government began to deprive them of their rights, and long before the introduction of the present national health scheme.
I have had some rather interesting experiences recently, and so have several people who are closely associated with me, in regard to the payment of benefits for hospital treatment. I think that this bill is a step in the right direction so far as people over the age of 65 years are concerned. Such people should not be obliged to contribute to medical benefit societies; they should be entitled to free medical and hospital treatment. Because the bill will enable them to receive increased benefits it is, as I have said, a step in the right direction.
The supporters of the Government are apt to boast of the benefits that they have provided for pensioners, but unless a pensioner collapses in the street it is almost impossible for him to be admitted to a hospital. That position, and the statements that have been made to-night regarding Labour’s health scheme, have prompted me to participate in the debate. I remind honorable senators opposite that when we proposed a scheme to cover cottage hospitals in country areas, we were told that it would be impossible to operate, that we were asking the Government to do too much, and that such hospitals should not be the responsibility of the Government. To-day, the Government is providing subsidies for people who can afford to contribute for the higher payments provided by the medical benefit societies which are able to build palatial offices in our metropolitan cities. Those who cannot afford to contribute to such societies, and who really need assistance, are left out in the cold. For that reason, we say that the Government’s health scheme is wrongly based.
The present Government parties ridiculed Labour for its ideas on national health. We were lampooned in the press because we wanted to provide a fine health service throughout Australia. Our purpose was to prevent disease and, where we could not prevent it, to provide adequate treatment. The present health scheme does not do that, because if a person cannot afford to contribute he is not able to receive treatment.
– in reply - I wish to deal with a few of the points that have been raised during the debate, some with heat and others with more heat than accuracy. Senator O’Flaherty’s statement to the effect that medical benefit funds were conducted for the benefit of their shareholders was so far wide of the truth that it should not be allowed to pass without contradiction. I point out that one of the primary considerations governing the participation of such societies in the national health scheme is that they should be non-profit-making.
– Do not be silly.
– I am not being silly. Their expenses must be kept to a certain ratio. They are non-profit-making organizations, as the honorable senator knows. They would not be approved societies unless that were so.
We have heard a good deal about the Labour medical benefit scheme which never operated. It provided for a limited formulary under which the medical practioners refused to work. In the whole of the Commonwealth, the Labour Government could find only 185 doctors who were prepared to work in accordance with the formulary. As a result, the scheme collapsed. In fact, it was not a scheme at all. I was interested in Senator Tangney’s remarks. She stated that pensioners were not receiving the benefits that they should be receiving because they were subject to a means test. Under this scheme 750,000 pensioners receive free medical benefits. Tn addition, 70,000 pensioners have incomes which debar them from receiving such benefits. I like a scheme which gives 750,000 pensioners these benefits at no cost to them and charges those pensioners who have incomes and can afford to pay for medical treatment. People who have incomes do not ask for charity. This is the sort of scheme that I like and the Australian people like.
I have heard a lot about the Commonwealth’s contribution to hospitals. The Government pays 8s. a day to the hospitals and pays an additional 12s. a day - a total of £1 a day - if a person insures himself and his family. It costs him ls. 6d. a week to insure himself, his wife and his family, and he receives 12s. a day extra, or a total of £1 a day, if any member of the family is in hospital. All he has to pay is ls. 6d. a week and he can claim the benefit as an independent Australian who contributes something that he wants to contribute. There is no hand-out
Honorable senators opposite talk about health schemes in other countries. No other country in the world gives to its people as wide a range of benefits as Australia gives with a population of only 10,000,000. Our repatriation benefits are the best in the world. So are our war service homes scheme, health services and hospital benefits. It is easy to pick out a country which gives one little thing that is a bit better than what we give; but we should look at the other things it gives its people. Ask people from England about the age pensions paid there in comparison with the age pensions paid in Australia. I am proud of Australia and the 10,000,000 Australians who provide the money for this wide range of benefits that are available to all our people. It is something of which we all can be proud. Instead of standing up and moaning about it and saying that some other country has some little thing which is better than one little section of the services we. provide, we should look at the broad picture of what Australia does for its people and acclaim it. Do not say that British people come out here expecting this and. that and do not find what they expect to find. We should not run Australia down; Australia has a proud record in these matters. This is not a Government matter; it is an Australian matter because the Australian people find the money for these services.
– Get the flag out!
– I know you do not like my saying these things, but they are true.
– What about the National Health Bill?
– I will get on to it shortly. All that the Labour Party, with its great conception of a health scheme, could say was that it would nationalize the doctors if they did not do what they were told to do.
– That is ridiculous. You know that it is not true.
– I know that you tried to nationalize them. Senator McKenna said so, as reported in “ Hansard “. He said, “ If the doctors do not do this we will nationalize them “.
– In which “ Hansard “?
– The doctors said, “Go ahead and do it”. Senator McKenna’s statement is in “ Hansard “; there is only one “ Hansard “ for the Senate, as we know.
– Of what date?
– You can see it any time you like to look it up. I have not the time to look it up now, but I will give it to you to-morrow. Then you will be able to read it for yourself.
– That has never been said.
– If you do not believe it, I will read it to you from “Hansard” now.
– Just tell me in which “ Hansard “ it is.
– The honorable senator wants to know in which “ Hansard “ it is. In the Parliamentary Debates of the House of Representatives for the third session of the Twenty-third Parliament, on Wednesday, 19th April, 1961, this is what a former Labour Minister, Mr. Pollard said-
– What did he say abou.t health?
– First, Dr. Donald Cameron said -
Honorable gentlemen opposite are in favour of the nationalization of health services. We understand that.
Then Mr. Pollard said -
What would be wrong with it?
– That is right.
– Of course, you believe in it, but you are now trying to tell me that you do not believe in it.
– You said Senator McKenna said that Labour would nationalize the doctors.
– I will show you that to-morrow. 1 have not with me at present the “ Hansard “ in which Senator McKenna’s statement is recorded. It is such a. long time since the Labour Party was in office that I have to go back about twelve years; but I will turn it up. That statement has never been disputed by the Labour Party. It tried to nationalize the medical profession, but it could not get the doctors to work the scheme. The scheme failed completely. When this Government came into office, it set the ball rolling and developed the scheme that we have to-day, which would be a credit to any government in any country.
I listened with great interest to Senator McManus. In Tasmania we have a very good State dental system which cares for the school children in that State. The Labour Party would encounter all the opposition in the world if it tried to bring that service under the central Commonwealth Government. How members of the Labour Party love to centralize power in Canberra and take it away from the States. But if they try to take away the Tasmanian school dental scheme the State government will not be very pleased about it. The State governments like to retain their sovereign rights in these matters. When they are giving a good service they wish to continue to give it. This is a State matter and Tasmania is meeting its responsibility. Senator Dittmer would love to tear all these powers away from the States and centralize all power in Canberra. The Labour Party wants to centralize government. The people in the small States would suffer under a centralized socialist government in Canberra. Do not tell me that the Labour Party does not believe in that scheme, because the whole of its policy is based on the abolition of the State governments and the centralizing of government in Canberra. That is what Labour wants and that is what it is working for. Of Course, Labour will not get it. Senator Dittmer said that we should have a Commonwealth scheme worked from Canberra.
– He did not use those words.
– Yes, he did. That is what he said. Apparently Senator Kennelly was not in the chamber when Senator Dittmer said that. I wrote it down because I knew I would be replying to it Recently, the Minister for Health (Dr. Donald Cameron) made a statement on this matter of a dental scheme. He said that he has had extended conferences with the Australian Dental Association and has examined closely the problems and the worth-while features of a dental scheme. He went on to refer to the probable cost and the apparent shortage of dentists. Senator McManus made an interesting point when he said that we were losing our dentists to Great Britain.
– That is right.
– That is quite right. Senator McManus said that we should have a national dental scheme to give Australian dentists additional hand-outs as an incentive to remain here. Do not honorable senators think that dentists are earning pretty well in Australia at present? Of course, they are. The scheme in Great Britain is rapidly breaking down. Dentists are charging for all sorts of services for which they never charged before, because they realize that the cost of these services just cannot be borne entirely by the taxpayers. The fundamental difference between the Liberal and Country Parties and the Opposition is that we do not believe in free hand-outs. When Labour was trying out its free hospital scheme there was not a bed available in a hospital anywhere in Australia. People stayed in hospital and could not be removed. The result was that sick people could not get into hospitals because there was not a bed available anywhere in Australia. That occurred over and over again. It was only when we began to deal with the problem on a common sense basis that we got the hospitals scheme working well. In some States there is still a shortage of beds, but that condition formerly applied throughout Australia. At least we have to some considerable extent rectified the position.
– How long ago was that?
– I know that it seems a long time ago to the honorable senator because it is a long time since his party was in government. It will be an even longer time before his party is again in government. I think I have answered most of the questions raised in relation to the bill.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Senate adjourned at 10.52 pm.
Cite as: Australia, Senate, Debates, 3 May 1961, viewed 22 October 2017, <http://historichansard.net/senate/1961/19610503_senate_23_s19/>.