Senate
26 November 1968

26th Parliament · 2nd Session

  1. Senate
  2. 26th Parliament
  3. 1968

The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 2.30 p.m., and read prayers.

page 2311

QUESTION

UREA

Senator WILKINSON:
WESTERN AUSTRALIA

– I am not sure to whom my question should be directed, but I think it concerns the Minister representing the Minister for Trade and Industry. I ask: ls there any possibility that urea produced in Australia will be able to compete with imported urea without the protection of a high tariff, the landed price of imported urea being $39 a ton, and the cost to the farmer being $73.50 a ton?

Senator MCKELLAR:
Minister for Repatriation · NEW SOUTH WALES · CP

– I cannot answer the honourable senator’s question at the moment. I will direct it to the Minister for Trade and Industry.

page 2311

QUESTION

INTERNATIONAL FINANCE

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– Has the Leader of the Government in the Senate a statement to make to the Senate about the financial crisis in parts of Europe, particularly in France? Can he inform the Senate of the likely effect on Australian trade of any currency changes in Europe?

Senator ANDERSON:
Minister for Supply · NEW SOUTH WALES · LP

– Not only would it be premature for me to give a judgment on a matter of international trade, as requested by the honourable senator, but it would also be most inappropriate. All 1 can say on the matter is that the Treasurer is being kept informed of all the various implications likely to affect the Australian economy. If the Treasurer were to make a statement on the matter, I would hope to be able to repeat it in the Senate.

page 2311

QUESTION

RAILWAY ROLLING STOCK

Senator BISHOP:
SOUTH AUSTRALIA

– My question, which I direct to the Minister representing the Minister for Shipping and Transport, relates to tenders called by the Commissioner of Commonwealth Railways for the supply of 2 sleeping cars and 8 passenger cars to operate over the completed standardised railway system, and also to the manufacture in Japan of certain Australian railway rolling stock requirements. In view of the need to maintain a continuing Australian railways capacity to manufacture railway rolling stock requirements, and the South Australian railways experience in standardised works, will the Minister endeavour to have orders for this railway rolling stock placed with the South Australian railways workshops? Will he also endeavour to have Australian orders from private concerns for railway rolling stock placed with other railway workshops throughout Australia, or with private manufacturers who have shown themselves to be competent in this field?

Senator SCOTT:
Minister for Customs and Excise · WESTERN AUSTRALIA · LP

– A condition of full employment has operated in Australia since 1949. Prior to 1949 we did not have full employment. Australia is now equipped to carry out many building programmes for railway wagons and engines. Wherever possible Australian resources are used, providing that Australia can compete with overseas countries. In many cases Australia has successfully competed for the manufacture of railway rolling stock. I ask the honourable senator to place on notice his question about the manufacture by the South Australian railways workshops of rolling stock for use on standard gauge railways and T will get an answer for him from the Minister for Shipping and Transport.

page 2311

QUESTION

TRADE WITH THE UNITED STATES OF AMERICA

Senator LILLICO:
TASMANIA

– Has the Minister representing the Minister for Trade and Industry read the statement appearing in the Press, made by the Australian Ambassador to the United States of America, Sir Keith Waller, appealing to the United States to give Australian exports to that country a fair go and requesting at least the right of reasonable access to the United States market? This access is enjoyed by the United States on the Australian market to such an extent that Australia has a debit in its trading relations with that country of nearly $437m, amounting to approximately $36.50 for every man, woman and child in Australia. Will the Government make forceful representations to the new Administration soon to take over in the United States in an attempt to rectify this position? In the event of failure to achieve a better balance with the United States, should not the Government attempt, by means of its tariff policy and agreements with various countries, to develop trading relations with other countries where those relations would be more reciprocal?

Senator ANDERSON:
LP

- Senator Lillico gave me prior advice that he proposed to raise these questions. I have therefore taken the opportunity to study the address given by Sir Keith Waller to the Foreign Trade Convention in New York earlier this month. It is true that the balance of trade between Australia and the United States has been heavily in favour of the United States in recent years. In 1967-68 Australian imports from the United States exceeded exports to that country by $A436m and over the past 10 years the total imbalance has been $A2,768m.

Whilst the Australian Government is anxious to see the imbalance reduced by greatly increased exports to the United States, it does not seek a strict balance of trade with any individual trading partner. Our aim is to expand exports generally and to achieve an overall balance in trade and international payments. What we do seek - and this is the key to our approach - is a reasonable opportunity to sell our goods in the United States and in other world markets. Unfortunately this opportunity is denied by the United States in regard to some of our major export commodities. For example, there is a virtual embargo on the importation into the United States of dairy products, even though Australia and other countries negotiated improved terms of entry in these products in the early General Agreement on Tariffs and Trade negotiations. The United States is the only major trading nation to impose a duty on wool, and strenuous efforts by the Australian Government to negotiate a reduction in the level of duty during the Kennedy Round were unsuccessful. The market for meat, which Australia has developed in recent years in the United States, is now under threat of quota restrictions.

Australia is an attractive market for many of the products of the United States and other industrialised countries, particularly for capital goods and equipment to develop the vast resources of this country, but we are dependent on income from exports to maintain these purchases. The Government has constantly pressed the United States

Administration to provide better access for Australian goods and will continue to do so on every appropriate occasion.

page 2312

QUESTION

UNEMPLOYMENT STATISTICS

Senator POYSER:
VICTORIA

– My question is addressed to the Minister representing the Minister for Labour and National Service. In reply to a question asked by me last week he indicated that the numbers of persons registered for employment were not available on a district basis. Can he supply me with the reasons why these figures are not available to honourable senators on request?

Senator WRIGHT:
Minister for Works · TASMANIA · LP

– If I recall correctly the matter to which the honourable senator is referring, last week I gave an answer in regard to employment figures for the district of which Geelong is the centre. In the course of explaining why a specific answer could not be given in relation to Colac - I think that was the centre referred to in the question - I pointed out that records are not kept in relation to each subdivision of a district. I would have thought that a moment’s reflection would have persuaded the honourable senator that there is a limit to which statistics can be dissected and that it was appropriate to give the statistics that J gave him. They were the full statistics for the district of which Geelong is the centre and which includes Colac.

page 2312

QUESTION

RAILWAY ROLLING STOCK

Senator MULVIHILL:
NEW SOUTH WALES

– 1 direct to the Leader of the Government in the Senate a supplementary question to that asked earlier by Senator Bishop. 1 alerted the Minister yesterday to my intention to ask the question. In view of the grave fears expressed by members of the metal trades unions in New South Wales employed by firms specialising in the manufacture of railway rolling stock that their future employment prospects are being jeopardised by the failure of the Commonwealth Government to insist that large rolling stock orders for Hamersley Iron Pty Ltd in Western Australia be constructed in Australia, can the Leader of the Government make a statement on the dangerous trend shown in this section of the metal trades industry?

Senator ANDERSON:
LP

– I sought some information for the honourable senator. I have not much to communicate at present, but I understand that it is true that lenders were called for railway rolling stock and that a tender was let to a Japanese organisation. lt is equally true that the local manufacturing industry has expressed some concern about the letting of the tender. As

I am informed at present, the Japanese organisation has been asked to make a documented case in relation to the matter because it would affect the tariff, lt is competent for any organisation to say: ‘We consider that more adequate tariff protection should he provided for our commodity’. So far as I have been informed, this documented case has not yet been presented to the Department of Customs and Excise. When 1 obtain further information I will inform the honourable senator.

page 2313

QUESTION

SNOWY MOUNTAINS AUTHORITY

Senator WEBSTER:
VICTORIA

– My. question is addressed to the Minister representing the Minister for National Development. 1 refer to the Supplementary Report of the Auditor-General, tabled in the Parliament on 19th November 1968. I ask the Minister whether he is aware of the paragraph on page 56 which refers to the accounts of the Snowy Mountains Hydro-electric Authority and reads:

The Statement of Receipts and Payments on Capital Account for )967-68 shows that amounts totalling S3..796.052 were received during the year by the Authority from Commonwealth Departments and others on a recoupment basis. Of this amount, a substantial portion was in respect of activities considered to bc nol authorised by the Act.

Can the Minister indicate to the Senate whether it is intended to introduce legislation to provide greater statutory authority and power for the Snowy Mountains Authority? Wilt the Minister recognise and take note of the effect on the business of private consultants which the wider activities of the Authority may be having in that it is carrying out consulting work which could be considered the province of private enterprise in the climate of an anti-Socialist government?

Senator SCOTT:
LP

– I read the AuditorGeneral’s report with a considerable amount of interest, ft is a fact that the Auditor-General is querying the Snowy Mountains Authority about the way it re ceived the sum of S3. 796,05 2 from other departments and the way that money was spent. I will take up the matter with the Minister for National Development and ask him to send a reply direct to the honourable senator.

page 2313

QUESTION

PENSIONS

Senator KEEFFE:
QUEENSLAND

– I address a question to the Minister representing the Prime Minister. By way of preface I ask whether the Prime Minister received the following telegram from the Secretary of the Australian Commonwealth Pensioners Federation on 22nd November 1968:

On behalf of Federation 1 have been instructed to express disgust huge parliamentary pay rises while your Government refuses to implement supplementary Budget for additional relief pensioners as proposed by Federation. The Federation calls on your Government to grant urgent extra Christmas help by double fortnightly pension cheque to assist all those in most need relying only on pensions.

Will the Government take any action along the lines requested by the Australian Commonwealth Pensioners Federation?

Senator ANDERSON:
LP

– I am not aware of any telegrams that would have been sent to the Prime Minister, but I shall make inquiries and let the honourable senator have an answer to his question.

page 2313

QUESTION

MOTOR VEHICLES

Senator O’BYRNE:
TASMANIA

– I address a question to the Minister for Customs and Excise. Has the Minister decided the extent of the price rises to be applied to several makes of European cars imported into Australia, a matter to which he referred the week before last? Can he now name the manufacturers whose vehicles will be affected, and can he say whether those manufacturers have been found guilty of breaches of the Customs Act? Will these price increases bc again followed by a further rise in the price of locally produced vehicles, as happened after Japanese manufacturers were forced to increase the price of their vehicles?

Senator SCOTT:
LP

– I announced in the Senate a. week or so ago that the Department of Customs and Excise thought that three European car manufacturers were exporting their vehicles to Australia at less than the normal value and the Department had told these manufacturers that if they did not take the action necessary to increase the prices of their motor vehicles the Department would demand cash deposits on those vehicles coming into Australia. The Department is still negotiating with these manufacturers. I am not prepared to name the companies concerned at this present time.

As to whether the prices of Australian manufactured cars will go up as a result of increases in the prices of imported cars, I inform the honourable senator that following the action taken in connection with Japanese cars coming into Australia, the prices of those cars were increased, but, at the same time, as a result of an application before it. the Commonwealth Conciliation and Arbitration Commission granted increases ranging up to $10 a week in some cases to metal trade workers. Following that increase by the Commission, the Australian manufacturers found it necessary to increase the prices to the Australian public of locally produced vehicles.

page 2314

QUESTION

INTERNATIONAL FINANCE

Senator GEORGES:
QUEENSLAND

– I address a question to the Leader of the Government in the Senate. Will the Government indicate to the Parliament, before it rises, what will be the consequences to Australia if the French franc is devalued, if sterling is further devalued, if the Deutsche mark is revalued and if the price of gold is lifted? As all these eventualities are possible, will the Minister assure us that Australia will not be left to the mercy of some roughedged decision during the coming recess similar to that which was made in the case of the MLC Ltd and the Esso-BHP oil agreement?

Senator ANDERSON:
LP

– The honourable senator asks me to indicate what will be the position if there is a devaluation of the French franc; what will be the position if there is a devaluation of sterling, if there is a revaluation of the Deutsche mark and if the price of gold is lifted. 1 am sorry but I cannot give him the answer to those questions today. I do not wantto appear flippant but, really, they are all hypothetical questions.

Senator McClelland:

– Just like your defence policy.

Senator ANDERSON:

– The honourable senator is being rude. All I say is what I said before. Very properly, the Treasurer is being kept informed of things that are happening in Europein connection with the international currency problems that have emerged there. I am quite certain that he can be relied upon absolutely to do whatever is in the best interests of Australia if any of these projected things occur.

page 2314

QUESTION

COMMONWEALTH AID ROADS AGREEMENT

Senator LAUCKE:
SOUTH AUSTRALIA

– I direct a question to the Minister representing the Treasurer. By way of preamble I wish to say that at two recent conferences of the LocalGovernment Association of South Australia concern was expressed that consideration was being given by the Commonwealth . Government to a variation of the formula for the allocation of road grants to rural areas. In view of the beneficial results which have stemmed on a State-wide basis from the existing formula, can the Minister inform me whether the formula will be retained?

Senator ANDERSON:
LP

– Those honourable senators who have been members of this chamber for some time will recall the many spirited debates on this subject. When the Commonwealth Aid Roads Agreement is due for renewal it is normal to discuss the formula with the States. 1 cannot recall the precise time that the Agreement comes up for renewal. Hansard is studded with many stirring speeches made by honourable senators on the rural provision of the Agree-: ment and on the formula generally. I commend those debates to the honourable senator for good reading. It is not likely that there will be any variation of the formula although it will be considered with the States when the Agreement is about to be renewed.

page 2314

QUESTION

NATURAL DISASTERS

Senator MILLINER:
QUEENSLAND

– My question is directed to the Leader of the Government in the Senate. In view of the tragic circumstances in which the residents of Killarney, a provincial town in Queensland approximately 100 miles from Brisbane, now find themselves as a result of a typhoon which struck that town last Friday evening, will the Government give urgent consideration to providing relief if it is requested to do so by the Queensland State Government?

Senator ANDERSON:
LP

– -As I have indicated before, the provision of special relief of this nature is a matter between the Premier of the State concerned and the Commonwealth. 1 am quite certain that the Commonwealth will act on a request for relief from the Queensland State Government in much the same way as it has acted on similar requests on previous occasions. But it is essentially a matter for the Premier of Queensland to make representations to the Commonwealth. I saw on television some film of the Killarney tragedy and 1 agree that the typhoon caused much devastation. However, I repeat that it is up to the Premier of Queensland to make representations to the Commonwealth Government.

page 2315

QUESTION

BUSH FIRE RELIEF

Senator ORMONDE:
NEW SOUTH WALES

– My question is directed to the Leader of the Government. Is the Government taking any immediate action to assist the New South Wales Government to control bush fires in that State?

Senator ANDERSON:
LP

– Matters pertaining to bush fire control are within the sovereignty of the States and under normal circumstances are the concern of the States. But if there were some situation or emergency whereby a Commonwealth agency could be sought to give assistance, I have no doubt that any such request would be carefully examined.

Senator Ormonde:

– The use of aircraft?

Senator ANDERSON:

– That would have to be considered. A bush fire may occur near a military establishment and it may be advantageous to provide some physical assistance. But whatever the circumstances, it is up to the State, through its agencies, to seek assistance from the Commonwealth. The States have the prime responsibility of requesting such assistance.

page 2315

QUESTION

AUSTRALIAN ARMY

Senator O’BYRNE:

– My question is directed to the Leader of the Government in the Senate. I ask: Are discussions to be held later this week on recommendations by the Defence Committee for an extension of conscription? Has the Committee stated that the present intake of conscripts will have to be maintained long after the Vietnam war is over, and perhaps greatly increased? Has the Committee suggested that the strength of the Army be increased by 13,500 men by 1976, to bring the Army’s strength by that date to more than 56,000 men? Does the defence review recommend a withdrawal of all Australian land forces from Asia after the Vietnam war ends, or at least by 1971, when Britain will have completed her military withdrawal from the region? Does the Committee rule out any possibility of Australia being involved in a land war in the next 15 years? If this is so, will the Minister reconcile this forecast with the continued need for conscription?

Senator ANDERSON:
LP

– The honourable senator gave us a clue when he referred to a ‘forecast’. I do not know the origin of the forecast, but the question is one of Government policy and does not lend itself to an answer at question time.

page 2315

QUESTION

VIETNAM

Senator KEEFFE:

– Is the Minister representing the Minister for the Army aware that several more Australian soldiers engaged in the Vietnam conflict have been wounded or killed in action? Is he also aware that in all of the recent casualty lists a large number of conscripts have been involved? Can the Minister explain to the Parliament why, of the forces involved, the percentage of conscripts being killed or wounded is higher than the percentage being killed of any other grouping of servicemen from Australia or any other country with servicemen engaged in combat in this area?

Senator McKELLAR:
CP

– The honourable senator refers to recent casualties. A list has been issued within the last 2 days which I did see. The honourable senator also referred to conscripts. We have no conscripts; we have national servicemen. I do not know whether the number of national servicemen suffering casualties is to a large degree greater than that of regular servicemen. If this is so I do not know the reason, but I will put the question to the Minister for the Army and see if he can provide an answer.

page 2316

QUESTION

AUSTRALIAN BROADCASTING COMMISSION

Senator GEORGES:

– Will the Minister representing the Postmaster-General confirm reports that the Australian Broadcasting Commission Federal Director of Talks, Mr Alan Carmichael, is to be transferred to London? If this is so, is his transfer designed to remove controversial topics from Talks Department programmes, or even to bring about the Department’s eventual closure? With these moves under way. is the morale in the ABC reaching a point where repressive elements in Australia will soon be able to claim another victory over liberal opinion? Further, will the Postmaster-General comment on the truth of reports that officers of the Department of External Affairs now brief ABC staff before they produce programmes from outside Australia? Also, are reports from ABC reporters in Asia vetted by senior ABC officers before undergoing normal processing for television and radio?

Senator Dame ANNABELLE RANKIN:

– In answer to the points raised by the honourable senator 1 would first of all say. as I have said before in this chamber, that the Australian Broadcasting Commission has complete autonomy regarding its programmes and can, of course, appoint people and change programmes as it wishes. But there are also some points which the honourable senator raised concerning the Department of External Affairs and I will comment on those. Relations between the Department of External Affairs and branches of the ABC responsible for news and feature programmes are essentially the same as the Department’s relations with the Press and commercial radio and television stations. It is quite untrue to say that there has been increasingly strict surveillance of the ABC by the Department in respect of news and feature programmes. The Department of External Affairs briefs ABC personnel going abroad to make programmes, but it does the same on request for journalists or commercial radio and television teams going abroad to cover subjects coming within the Department’s area of responsibility.

page 2316

QUESTION

COTTON

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– I direct a question to the Leader of the Government. Did the Minister hear a report on this morning’s radio news that three Japanese businessmen representing the cotton textile industry in Japan are in Australia endeavouring to purchase large quantities of Australian raw cotton? Does the Minister know whether the Australian Government is actively interested in this arrangement or whether it is a deal between the Australian cotton interests and Japan? Will the Government do all that it can to bring about a deal with the Japanese textile industry to find a market for a large part of Australia’s raw cotton?

Senator ANDERSON:
LP

-I know nothing of the circumstances referred to by the honourable senator. All I can say is that I shall ascertain the facts and let the honourable senator know.

page 2316

QUESTION

AUSTRALIAN BROADCAST I NG COMMISSION

Senator MURPHY:
NEW SOUTH WALES

– My question is addressed to the Minister representing the Postmaster-General. On 13th November 1968 the Minister said that she would take up with the Postmaster-General the question of what complaints had been made by or on behalf of any Minister, member of Parliament, political party or other political organisation during 1968 about the programme ‘People’ and its conduct by Mr Sanders. Is the Minister now in a position to answer that question?

Senator Dame ANNABELLE RANKIN:

– I have a prepared reply to the question and perhaps I can give it now. The Postmaster-General has furnished me with the following information: The Australian Broadcasting Commission during 1968 has received no complaints concerning the programme’ People’ which were made by or on behalf of any Minister, member of Parliament or political organisation.

page 2316

QUESTION

SOCIAL SERVICES

Senator FITZGERALD:
NEW SOUTH WALES

– My question is addressed to the Minister representing the Minister for Social Services. Will the Minister approach the Minister for Social Services to secure for me before the Parliament adjourns a reply to question No. 775 which asked that a reciprocal agreement be brought about with the Government of Malta on social service benefits?

Senator Dame ANNABELLE RANKIN:

– I shall take up this matter with the Minister for Social Services.

page 2317

QUESTION

BUILDING REGULATIONS

Senator LAUGHT:
SOUTH AUSTRALIA

– I address my question to the Minister for Works. In the light of recent stirrings in Canberra relating to the up-dating of building laws and regulations, does the Minister not consider that the moment is opportune and urgent to bring in up-to-date and uniform building regulations throughout Australia? Can the Minister state what stage has been reached in the current programme of standardisation and when it is likely to be introduced?

Senator WRIGHT:
LP

– Honourable senators will recall that about 8 weeks ago I gave an answer to the honourable senator on this subject indicating that about two chapters, containing about 20 departments of the total of 59 classifications, were in an advanced drafting stage. The precise answer that I gave is in Hansard, but what I have said is perhaps sufficient to remind honourable senators of the approximate position. I am waiting only for the rising of Parliament to take the opportunity to confer with Dr Isaacs, the director of the Commonwealth Experimental Building Station, who is undertaking the review of the regulations, to see whether the programme can be advanced. However, it must be remembered that as it will make an impact upon the State governments in their various forms and local government in its various forms, and the objective which it is hoped to achieve is in the nature of a code to be followed by the various State government and local government instrumentalities, it is not expected that there will be promulgated a set of building regulations which will be adopted uniformly throughout the Commonwealth.

page 2317

QUESTION

INDUSTRIAL SAFETY

Senator MILLINER:

– I preface my question to the Minister representing the Minister for Labour and National Service by saying that two building trades workers in Brisbane have lost their lives on the same building project in the last 8 weeks as a result of unsafe working conditions. Has the Minister’s attention been drawn to the decision of 8,000 building trades workers in Brisbane who have stopped work in order to draw attention to the inadequacy of safety precautions on building projects? Will the Minister encourage the respective State Ministers for Labour and Industry to convene immediately an objective conference of employees’ and employers’ representatives in an endeavour to arrive at decisions which will ensure an improved standard of job safety conditions of employment?

Senator WRIGHT:
LP

– I have noticed a reference to stopwork meetings in relation to these regrettable fatalities. I express my own disappointment that that action has been taken, because it leads to loss of wages. There are other more significant ways of directing the attention of the authorities to the need for safety. It would not be appropriate for me to give an undertaking that we would request a conference of State Ministers, but for the satisfaction of the honourable senator I direct his attention to a passage in the annual report of the Com-‘ missioner of the Snowy Mountains Hydroelectric Authority. By a concentration upon safety precautions the organisation was able to reduce’ most significantly the ratio of accidents per one million man hours.

I am assured that a branch of the Department of Labour and National Service has the special duty of seeing that safety devices and safety methods are brought constantly before governments and employers. The honourable senator will be reminded that in a recent reply to a question from him I furnished an elaborate list of notices that the Department had prepared. Those notices, which are available to and are disseminated through the employer community, suggest their adoption so that the matter of safety will be constantly before the minds of people responsible for the safety of labour.

page 2317

QUESTION

NATIONAL DISASTERS

Senator MCCLELLAND:

– Has the attention of the Minister representing the Prime Minister been directed to a statement attributed to the honourable member for Hume which appeared in the ‘Cooma-Monaro Express’ of Friday last, 22nd November, to the effect that whilst the New South Wales Government had introduced certain drought relief measures in the Bega Valley they were inadequate to save all the stock, and that he believed it essential that there should be a Commonwealth drought authority to take charge whenever and wherever a severe drought struck. Does the Minister agree that droughts, floods and bush fires, such as the very severe fires now burning in New South Wales, fall into the category of national disasters and cause an inadequacy in the funds available to the States to tackle effectively these great calamities? Will the Australian Government give immediate consideration to the establishment of a Commonwealth fund for this purpose?

Senator ANDERSON:
LP

– I have not had the advantage of reading last Friday’s edition of the newspaper to which the honourable senator has referred. We left here last Friday rather exhausted and I have not yet caught up with my reading. The first thing that must be remembered in relation to a Commonwealth drought authority is that the States have sovereignty. They are very jealous of it. Whilst the States very properly from time to time seek aid from the Commonwealth when national disasters occur, nevertheless the administrative side of that aid is in the hands of the States. They cherish that responsibility. We have had debates on this matter in the Senate. 1 think there has been before us a proposal to form a national disaster organisation. 1 suggest that the arrangement that currently prevails, whereby the States accept the responsibility of judgment in seeking aid from the Commonwealth and then administer that aid, is a very practical and sensible one.

page 2318

QUESTION

REDFERN MAIL EXCHANGE

Senator ORMONDE:

– I address my question to the Minister representing the Postmaster-General. Is it true that machines at Redfern mail exchange are damaging or mutilating more than 700 letters a day? Will the Minister confirm or deny that the number of technicians servicing sorting machines at Redfern mail exchange has increased from 50 to 500 in the past 5 years? If this is so, are the machines, which were installed initially as labour saving equipment, efficiently meeting the needs of the exchange?

Senator Dame ANNABELLE RANKIN:

– I could not tell the honourable senator about the number of people maintaining the machines. I will be pleased to put his question to the Postmaster-General and to get him a reply. When we speak of articles that are damaged or lost, we should remember that a lot of articles are lost because they are incorrectly addressed and that a lot of aricles are damaged because they are incorrectly parcelled. I will put to the Postmaster-General the point made concerning the machines.

page 2318

QUESTION

APPLES

Senator LAUCKE:

– I ask the Minister representing the Minister for Primary Industry whether compensation will be paid to growers for devaluation losses sustained by them in respect of shipments of apples which were lost in the Suez Canal at the time of its closure.

Senator McKELLAR:
CP

– If 1 heard the honourable senator correctly, his question related to fruit which is tied up in the Suez Canal. My understanding is that compensation will not be paid. Negotiations have been proceeding - I do not know that they have been settled - for some months about insurance for the fruit locked in the Suez Canal. To the best of my knowledge the fruit referred to will not come under the scheme for compensation due to devaluation. I shall make further inquiries to see whether my thinking is correct on this point and will let the honourable senator know.

page 2318

QUESTION

F28 AIRCRAFT

Senator DEVITT:
TASMANIA

– My question is directed to the Minister representing the Minister for Civil Aviation. Is the Minister aware of any moves being made to evaluate the F28 aircraft, which is the jet version of the Fokker aircraft? This aircraft could be an acceptable jet replacement for Viscount aircraft now being phased out of service. It would maintain and in fact improve the standard of service to airports now served by Viscount aircraft. This standard will otherwise be lost when the Viscount goes out of service. Would the acquisition of the F28 or similar aircraft obviate quite substantial expenditure by the Government on airport improvements, including runway strengthening and so on, which would be necessary to accommodate DC9 jet aircraft, the only jet aircraft in service at present which can properly be regarded as improvements to replace Viscount aircraft? If so, can the Government make its views known to the airlines, since the adoption of a smaller jet aircraft of this type would tend to transfer to the airlines the financial burden of improving airports, and so help to bridge the substantial gap between revenue and capital expenditure on aerodromes throughout Australia?

Senator SCOTT:
LP

– The honourable senator has asked a very interesting question. MacRobertson Miller Airlines Ltd and Ansett-ANA are considering various types of jet propelled aircraft to be used to supersede Viscount aircraft and the F28. The honourable senator has suggested that the DC9 is a possible replacement. 1 understand that Ansett-ANA is also examining the possibilities of using a smaller version of the BACI I I aircraft. Of course, when these pure jet aircraft are brought into service by the airlines, the Department of Civil Aviation will be required to upgrade certain airports in Australia. At present the Department is studying this matter in consultation with the airline companies concerned. So that the honourable senator may obtain the correct information, I ask him to place his question on the notice paper.

page 2319

QUESTION

OIL SEARCH

(Question No. 528)

Senator ORMONDE:

asked the Minister representing the Minister for National Development, upon notice:

  1. Why has Esso-BHP suspended operations at Snapper Al oil well?
  2. Did Ocean Rig Discoverer II plug a hole at a depth of 11,133 feet before leaving the area?
  3. Does this area still show good prospects for substantial oil reserves?
Senator SCOTT:
LP

– The Minister for National Development has supplied the following answers:

  1. Esso-BHP announced on 12th September 1968: “The Snapper A-l well has been drilled to 11,133 feet and has been temporarily suspended. Further work will be done on this well at a later date. The offshore drilling rig, Discoverer II, has completed its drilling contract in Bass Strait and will be handed over to another Esso affiliate to fulfil a drilling contract in New Zealand waters.’ This rig move has been necessary to meet contract arrangements in respect of Discoverer II. The offshore drilling rig Ocean Digger will resume operations at Snapper A-l as soon as it completes operations at the Flounder A-l location.
  2. The offshore drilling vessel Discoverer H did plug the hole when drilling had reached 11,133 feet before leaving the location. This is not an abandonment procedure but a routine safety measure to secure the well and protect any potential reservoirs during the change in drilling units mentioned in the answer to the first question. It does not mean the abandonment of the Snapper A-l location.
  3. The securing of Snapper A-l during the change over of drilling units in no way detracts from the petroleum prospect of the area. EssoBHP have reported small shows of gas and/or oil in thin, tight sands and have stated that further evaluations will be made following further drilling.

page 2319

QUESTION

DAIRYING

(Question No. 534)

Senator MULVIHILL:

asked the Minister representing the Minister for Primary Industry, upon notice:

  1. What is the total acreage of land in use for dairy farming in New South Wales, Victoria and Queensland?
  2. What was the acreage 10 years ago?
  3. Does the Government know of any plans to increase acreage for this purpose in any of the states referred to in 1 above?
Senator MCKELLAR:
CP

– The Minister for Primary Industry has supplied the following answers: 1 and 2. Statistics of this nature are not collected by the Bureau of Census and Statistics. The only statistics relating to size of dairy farms are contained in the Bureau’s ‘Classification of Rural Holdings by Size and Type of Activity’. These statistics are concerned wilh the acreage of holdings on which dairy cattle are recorded but there is no means of telling what proportion of these farms, particularly the larger ones, is in use for dairying purposes. Moreover, a change in the definition of what constitutes a dairy holding prevents a strict comparison of the 1965-66 statistics, the latest available, with the figures recorded 10 years earlier. With these reservations the accompanying table is presented.

  1. The Government is not aware of any plans to increase dairying areas in New South Wales or

Queensland. In Victoria, under a development programme initiated some years ago and managed by the Rural Finance and Settlement Commission a number of farms intended for dairying will continue to be allocated in the Heytesbury area of the Western District. The scheme envisaged a total of 500 farms of which 277 have been allocated. A proposal to develop for dairying some fifty irrigation farms in the Rochester district is also reported to be under consideration.

page 2320

QUESTION

IMPORTED MOTOR VEHICLES

(Question No. 552)

Senator ORMONDE:

asked the Minister representing the Minister for Trade and Industry, upon notice:

  1. Is the importation of fully assembled motor cars into Australia rising?
  2. If the overall position is that these imports are rising, what is the rate of increase from Japan, Germany, the United States, and the United Kingdom?
Senator ANDERSON:
LP

– The Minister for Trade and Industry has supplied the following answers:

  1. Imports of completely built up motor cars into Australia in 1967-68 were at a higher level than in recent years.
  2. During the past 4 years, imports from Japan and the Federal Republic of Germany increased whilst imports from the United States and Britain decreased. The following statistics, in terms of numbers of motor cars, shows the increases and decreases in imports from these countries.

page 2321

QUESTION

WOOD CHIPS

(Question No. 591)

Senator WHEELDON:
WESTERN AUSTRALIA

asked the Minister representing the Minister for National Development, upon notice:

In view of the serious concern in Western Australia as to the future of the wood chip industry, will the Minister make an early statement to Parliament as to the precise nature of the restrictions imposed on the export of wood chips and the reasons for their imposition and in the light of action recently taken by the Western Australian Government, whether it is proposed that the restrictions be relaxed

Senator SCOTT:
LP

– The Minister for National Development has supplied the following answer:

The honourable senator is no doubt aware of the statement made by the Minister for National Development on 26th September announcing that the Government would control the export of certain forest products, such as wood chips, suitable for the manufacture of paper pulp. That announcement states the reasons for the imposition of the export control and what the Government is looking for in the administration of the control. As stated at that time, the aim of the control is to ensure that an adequate price is received for the wood chips and that a reasonable degree of processing will be undertaken in Australia. Each proposal for export, whether it relates to a project in Western Australia or in any other part of Australia will be considered on its merits with these objectives in mind.

page 2321

QUESTION

EDUCATION

(Question No. 646)

Senator ORMONDE:

asked the Minister representing the Minister for Education and Science, upon notice:

  1. Was a national seminar on education planning held in Canberra recently.
  2. Was it attended by education authorities including representatives from independent schools, who announced and discussed plans for Australiawide education reform?
  3. Is a report being prepared? If so, when will it be presented to Parliament?
Senator WRIGHT:
LP

– The Minister for Education and Science has supplied the following answer to the honourable senator’s question:

  1. Yes. Under the auspices of the Australian National Advisory Committee for Unesco, a national seminar on educational planning was held at Ursula College, Australian National University, from 7th to 21st September 1968. It was concerned with the pre-school, primary and secondary levels of education.
  2. Attendance at the Seminar was at the invitation of the National Advisory Committee for Unesco. Some fifty-five participants attended, including State Directors-General of Education and other senior Education Department officers concerned with educational planning, and some persons from independent schools and other organisations. The Seminar did not make plans for Australiawide education reform, but studied in detail the problems, requirements and techniques associated with planning for education having in mind the main challenges which Australian education will have to face in the next few decades.
  3. A report of the seminar is being prepared for the Australian National Advisory Committee for Unesco. It will be available to honourable senators and members.

page 2321

QUESTION

NATURAL GAS

(Question No. 566)

Senator WILKINSON:

asked the Minister representing the Minister for National Development, upon- notice:

Has a contract been entered into for liquefying natural gas from Barrow Island and exporting it to Japan? If so, what are the terms of the contract?

Senator SCOTT:
LP

– The Minister for National Development has supplied the following answer:

No contract has been entered into for the supply of liquefied natural gas ‘from Barrow Island to Japan. A leading Japanese trading company, Toyo Menka, is reported to have been canvassing other Japanese firms for the formation of a consortium to co-operate with West Australian Petroleum Pty Ltd (WAPET) in the development of the Dongara gas reserves for the export of gas in a liquefied form to Japan by 1971. The project was estimated to cost $100m overall. These inquiries, like those from other interested parlies, were replied to by WAPET on a general basis. There have been no negotiations with WAPET by Toyo Menka or its representatives.

page 2321

QUESTION

TIMBER

(Question No. 654)

Senator POKE:
TASMANIA

asked the Minister representing the Minister for Trade and Industry, upon notice:

  1. During the 6 months ended 31st August, did more than 24 million super feet of New Zealand timber reach Australia?
  2. Is it a fact that, prior to the signing of the New Zealand-Australia Free Trade Agreement, only IS million super feet of New Zealand timber arrived in Australia in previous 6 monthly periods?
  3. In addition to the increase in the importation of New Zealand timber, has there also been an increase of approximately 11 million super feet of Douglas Fir from North America?
  4. In the light of such increased timber imports, will the Minister take action to reduce imports to a level so as not to aggravate an over-supplied Australian timber market which, in turn, has a detrimental effect on the marketing of Tasmanian timber on the Australian markets?
Senator ANDERSON:
LP

– The Minister for Trade and Industry has supplied the following answer:

In regard to questions 1, 2, and 3 the Commonwealth Statistician has advised that:

Imports of all timber (Standard International Trade Classification - Revised Group 243) from New Zealand for the period MarchAugust 1968 amounted to 27 million super feet.

Imports for the 6 months March-August 1965 prior to the signing of the New ZealandAustralia Free Trade Agreement were 16 million super feet.

Imports of Douglas Fir from North America for the period March-August 1965 amounted to 85 million super feet while 104 million super feet were imported during the 6 months March-August 1968.

The Government is of course well aware of the problems of the Australian timber industry at the present time. I have established an Economic Study Group consisting of two representatives of the timber industry nominated by the Australian Timber Producers’ Panel and two government officials to study these problems in depth and to report to the Government so that it may consider long-term solutions to the problems.

So far as imports from New Zealand are concerned, the Panel, on which the Tasmanian Timber Association is represented, has held discussions with departmental officials from time to time concerning the operation of the Free Trade Agreement and the effects of imports. The Panel is aware of the remedial measures in the Agreement in the event of imports reaching a damaging level. The Government would be prepared to give prompt consideration to any case presented to show that damage is being caused by increased imports from New Zealand or any other source.

page 2322

QUESTION

COMMONWEALTH OFFICES

(Question No. 657)

Senator MULVIHILL:

asked the Minister representing the Minister for the Interior, upon notice:

  1. Are any Commonwealth office blocks in the capital cities of the States subject to office cleaning contracts with any of the following contract cleaners - Browns, Crothalls or Berkeley? If so, what offices are concerned and what are the details of the respective contracts?
  2. Do contract conditions refer to trade union membership of the operatives?
  3. Would these firms’ directives be subject to scrutiny to ensure that the firms’ executive stability warranted such contracts being granted?
Senator SCOTT:
LP

– The Minister for the Interior has provided the following answer to the honourable senator’s questions:

  1. At 17th Ocotober 1968 when this question was asked, only one of the firms mentioned, Crothall and Co., held a contract for cleaning a Commonwealth office building under the control of the Department of the Interior and only one building was involved. This is Phillip House, in Sydney, (39,776 square feet) at a basic price of $12,998’.88 per annum subject to ‘rise and fall’ variations. However following an increase in the area to be cleaned, fresh tenders were recently invited and, as a result, Crothall and Co.’s contract terminated as at 4th November.
  2. The contract mentioned in 1. did not contain any conditions referring to trade union membership of the operatives. However, it did contain a condition which stated that the contractor shall ensure that aM persons employed in the cleaning of Commonwealth premises are paid at Tales which are not less than those fixed by any relevant award, determination, judgment or order of any competent Court etc., and are employed under the conditions prescribed in any such award.
  3. Before recommending the acceptance of any tender for contract cleaning, investigations are made as to the operational and financial capacity of the tenderer to carry out the terms of the relevant contract.

page 2322

QUESTION

LAKE BURLEY GRIFFIN

(Question No. 663)

Senator POYSER:

asked the Minister representing the Minister for the Interior, upon notice:

  1. Which sites for proposed buildings on the shores of Lake Burley Griffin have been investigated to ascertain if there arc any foundation problems?
  2. Who carried out the investigations?
  3. What was the extent of the investigations?
  4. What were the results?
Senator SCOTT:
LP

– The Minister for the Interior has provided the following answer to the honourable senator’s question:

  1. Sites for possible buildings on the shores of Lake Burley Griffin which have been investigated to ascertain if there are any foundation problems extend from the south-west side of the Commonwealth Avenue Bridge near the Albert Hall through to the south-east side of Kings Avenue Bridge. The sites for possible buildings which have been investigated include a Conference Hotel, Parliament House area, High Court and the Carillon on Aspen Island.

In addition, the results of geological surveys, foundation investigations and geological mapping undertaken during construction are available in respect of the following major projects already completed in the area: Administrative Building, Commonwealth Avenue Bridge, Kings Avenue Bridge, National Library, The Treasury, Lake Burley Griffin.

  1. The seismic and surface mapping has been carried out by the Bureau of Mineral Resources; drilling and testing has been undertaken by private consultants with contractors and by the Snowy Mountains Authoritywith the Bureau of Mineral Resources providing the geological advice.
  2. The investigations have included surface mapping and inspections, seismic traverses and diamond drilling.
  3. The results indicated that suitable foundations could be obtained in any of the possible sites investigated. The results of the investigations are contained in a number of reports, which are available if required.

page 2323

QUESTION

DEPARTMENT OF SUPPLY

(Question No. 666)

Senator MURPHY:

asked the Minister for Supply, upon notice:

What cases have occurred within the last 1.0 years, or are now in contemplation, of closing down, or reducing, manufacturing or service activities in the Department of Supply in order to abandon the field wholly or partly to private enterprise?

Senator ANDERSON:
LP

– The answer to the honourable senator’s question is as follows:

It is desirable to preface the answers to the specific questions by drawing attention to the fact that certain capacities were developed in Government establishments because industry was not in a position to provide and operate the facilities required. However, as the Australian industrial base broadens, it may be expected that industry will be called upon to undertake an increasing range of defence work using facilities established for commercial operations. Generally, it would not be policy to duplicate and maintain such facilities in Government establishments. Planning in my Department attempts to ensure that there is a proper balance maintained between the Government establishments and industry, the overriding factors being the best use of resources available and the broadening of Australia’s defence production capability.

The information sought is provided under the three categories. Very minor cases have not been listed and examples only are mentioned in one or two cases.

CASES WHERE ACTIVITY IS NO LONGER CARRIED ON IN GOVERNMENT ESTABLISHMENTS

Manufacture of ammonia, methanol, sulphuric acid and ammonium sulphate finally ceased in the government establishments in 1960. Production in the post-war years was mainly to meet an Australian shortage. Once the shortage was overcome continued production on the. uneconomic basis involved was not justified.

Manufacture of ball bearings. As the major outlet was commercial it was decided by Cabinet in 1959 that the facility could not be continued appropriately as a Government establishment.

Diecasting of certain small components has been progressively passed to industry. It was decided to foster existing capacity in industry rather than incur major expense on modernising the World War II Government-owned plant. 4.. Manufacture of empty detonator shells. Ample modern capacity in industry to meet volume requirements was the main reason for progressively ceasing production in the Government establishments.

Since 1963-64 manufacture of some ammunition components has been handled completely by private industry because changes in design and methods of fabrication have rendered the production more suitable for plant used in industry. Duplication of the plant in the Government establishments would not have been warranted. But conversely certain production handled previously by industry is now undertaken in the Government establishments, for example, certain shot and mortar shell work, and all wooden rifle furniture production.

Repair of certain optical equipment is now handled by capacity which has become progressively available in industry.

Responsibility for providing various services has been allocated to industry; for example,t he operation of some instrumentation systems including radars and target aircraft facilities.

The original NASA space tracking stations were operated by the Department of Supply until 1964, but the six stations now functioning are operated and serviced by industry under direction from the Department.

CASES INVOLVING REDUCTION IN ACTIVITY IN GOVERNMENT ESTABLISHMENTS

Manufacture of primers for gun ammunition was largely transferred to private industry in 1962 to avoid unwarranted duplication of plant and permit conservation of existing production facilities and expert staff for more complex work.

Manufacture of percussion fuses and fuse components was partially transferred to industry in 1962 mainly as part of the policy to broaden the basis of supply in case of an emergency.

Manufacture of clockwork delay mechanisms was fostered in industry in 1966 to broaden the basis of supply and to allow plant and skilled staff in the Government establishment to concentrate on the more complex mechanisms.

In the research and development field certain activities have been wholly or partly left to industry. Examples are calibration of mechanical testing machines and temperature control (pyrometric) installations, industrial radiography and general consultative work in the field of secondary metallurgy. These were services previously rendered to industry at its request. As capacity for the work has developed in industry the laboratories have ceased or reduced the service. Work in the field of microelectronics is being curtailed and allocated to the industry at an appropriate stage in its development.

CASES IN CONTEMPLATION INVOLVING EITHER CEASING OF OR REDUCTION IN ACTIVITY IN GOVERNMENT ESTABLISHMENTS

There are two decided cases in this category. One case involves the transfer of canvasware work undertaken at the Government Clothing Factory Annex al Brunswick. Industry is in a position to undertake the work and provision for the capacity in the proposed new Clothing Factory at Coburg would not bc justified. The work is expected to transfer completely to industry by mid 1969.

The other case involves the proposed closure of the Airframe Repair Workships, Parafield, South Australia in the first half of 1969 because of workload difficulties, lt would be expected that certain of the small residual workload will be allocated to the aircraft industry.

Other cases could develop. For example, with expanding capacity for manufacture of nitric acid in industry there may not be a continuing need to retain this capacity in the Government explosives factories.

My Department is reviewing continuously the whole field of defence production capability and the allocation of work between the Government establishments and industry, lt will be appreciated that it would not be appropriate for me to include in this reply any case which has yet to be considered by the Government.

page 2324

QUESTION

DEFENCE

(Question No. 689)

Senator LACEY:
TASMANIA

asked the Minister representing the Minister for Defence, upon notice:

  1. What was the yearly expenditure for capital equipment for the Armed Forces, per Service, from 1960 as a percentage of the Defence Budget?
  2. What is the estimated expenditure for capital equipment for each Service, per annum, for the years 1968-69, as a percentage of the Defence Budget?
  3. What was the re-engagement rate of Service personnel per Service, as a percentage of the total who were offered re-engagement, in each Service, from I960?
Senator ANDERSON:
LP

– The Minister for Defence has provided the following information:

  1. Actual expenditure on capital equipment, including amounts provided from United States Credits where appropriate, expressed as a percentage of total Defence expenditure:
  2. Estimated expenditure on capital equipment expressed as a percentage of total estimated Defence expenditure for 1968-69:
  1. Re-engagement rates of male other ranks expressed as a percentage of the total number of personnel whose engagements expired:

page 2324

QUESTION

TARIFF

(Question No. 690)

Senator LITTLE:
VICTORIA

asked the Minister representing the Minister for Trade and Industry, upon notice:

  1. What is the amount of tariff protection, on money value basis, afforded individual secondary industries in Australia?
  2. What is the estimated total tariff protection money value afforded all Australian secondary industry?
Senator ANDERSON:
LP

– The Minister for Trade and Industry has supplied the following answer: lt is not practicable and can be misleading to try and measure the effects of tariff protection in this way. The purpose of the tariff is to encourage the development of worthwhile Australian industries. The effect it has in this way on Australia’s economic development and employment opportunities cannot be measured in money terms.

page 2325

QUESTION

TAXATION

(Question No. 705)

Senator MILLINER:

asked the Minister representing the Treasurer, upon notice:

What is the estimated tax yield that will flow to the Government by direct taxation as a result of the increase of $1.35 a week recently awarded to adult workers throughout Australia?

Senator ANDERSON:
LP

– The Treasurer has supplied the following answer:

It is estimated that the wage increase recently awarded by the Commonwealth Conciliation and Arbitration Commission would result in increased tax instalment collections of about $85m in a full year at 1968-69 levels of employment and earnings, of which about $18m would be refunded on assessment.

As the increase will, in fact, apply for only about 8 months of the 1968-69 financial year and tax instalment deductions are generally paid into Government revenue in the months following deduction by employers, the increase in collections in 1968-69 that will result from the $1.35 increase is estimated to be about $50m, of which about $10m will be refunded in 1969-70. This is not to say, however, that, because of the Commission’s decision, which would add about 2% to average weekly earnings, pay as you earn collections in 1968-69 can be expected to be some $50m greater than the Budget estimate. This was based on the assumption that average earnings would be about 5.5% higher in 1968-69 than in 1967-68.

page 2325

QUESTION

BAUXITE

(Question No. 717) senator BISHOP asked the Minister representing the Minister for the Interior, upon notice:

  1. What is the current position with respect to negotiations to ensure a 50% Australian equity in the Gove bauxite project?

    1. Does satisfactory Australian participation now depend upon Commonwealth Government assistance to extend port and shipping facilities? If so, what decision has been made?

and 2. The companies participating in the Gove project have submitted to the Government proposals for the future of the project. The proposals are at present being studied by the Government. When decisions have been made and discussed with the companies an announcement will be made.

page 2325

QUESTION

CIGARETTES

(Question No. 737)

Senator ORMONDE:

asked the Ministerrepresenting the Minister for Health, upon notice:

  1. Is it a fact that after long investigation by Monash University scientists it was found that the tar content in types of cigarettes smoked in Australia varied from 33% down to 7i%?
  2. As a warning to smokers, will the Minister consider compelling all cigarette manufacturers to have printed on cigarette packets the percentage of tar content in each cigarette?
Senator Dame ANNABELLE RANKIN:

– The Minister for Health has furnished the following reply:

  1. The findings of Monash University scientists were that tar content varied, in the 13 brands that were studied, from 7.1 milligrams per cigarette to 32.3 milligrams per cigarette.
  2. At the 1968 Conference of Commonwealth and State Health Ministers recommendations were received from the National Health and Medical Research Council regarding a warning label on cigarette packages including reference to the tar content. The Ministers agreed to give the labelling proposals detailed consideration with a view to proposing a uniform approach at their next meeting. Before then it is expected that a final report on a survey of smoking attitudes will be received from the Council. The Ministers considered that it would be unwise to take any action on the labelling of cigarettes until this report became available. They agreed that it was important that there should be a uniform approach in each State since the responsibility for labelling is a State matter, and also agreed to work towards such a position.

page 2325

QUESTION

RADIO FREQUENCIES

(Question No. 743)

Senator MCCLELLAND:

asked the Minister representing the Postmaster-General, upon notice:

  1. Is a changeover being effected for Australian fishermen in ship to ship radio frequency from 4,620 kilocycles to 2,112 kilocycles?
  2. On what date is this changeover to take place?
  3. What is the estimated cost of the changeover in each of the States?
  4. By whom is it intended the costs will be borne?
  5. What is the reason for the proposed changeover?
  6. Does the Department have any intention of a further change in the early 1970s to a sideband wireless for Australian fishermen?
Senator Dame ANNABELLE RANKIN:

– The Postmaster-General has replied as follows:

  1. Yes,butit should be mentioned that the radio frequency at present used for ship to ship communication by Australian fishermen is 4,095 kilocycles and not 4,620 kilocycles.
  2. 1st July 1969.
  3. The cost of the changeover in each of the States cannot be estimated until it is known how many licensees require the fitting of the 2,1 12 kilocycle frequency to their vessels. The cost for individual vessels will vary between $20 and $70 depending on the type of radio equipment installed. At 30th June 1968 fishing vessels licensed to use 4,095 kilocycles numbered 494 in New South Wales, 317 in Victoria, 700 in Queensland, 340 in South Australia (including Northern Territory), 735 in Western Australia, and 198 in Tasmania.
  4. The licensees concerned.
  5. The growth in the number of radio equipped fishing vessels has reached a stage where the use of 4,095 kilocycles for inter-ship communication seriously jeopardises the effectiveness of the channel for safety purposes and very strong representations have been made to my Department by representative organisations of the fishing industry seeking transfer of such operations to another channel. The frequency 2,112 kilocycles, because of its propagation characteristics, will permit local inter-ship communication to be undertaken without mutual interference between ships in widely separated areas.
  6. The decision to introduce single sideband transmission into the Australian maritime radio service was made following the adoption of resolutions favouring such action by the World Administrative Radio Conference held at Geneva in 1967. So far as fishing vessels are concerned, all new radio installations made after the 1st January 1973 are to employ single sideband techniques. Double sideband emissions will be discontinued by the 1st January 1982 at the latest.

page 2326

QUESTION

FLYING SCHOLARSHIPS

(Question No. 744)

Senator McCLELLAND:

asked the Minister representing the Minister for Civil Aviation, upon notice:

  1. In the last financial year to which aero clubs in New South Wales did the recipients of flying scholarships belong?
  2. Have any scholarships been awarded by the Department this financial year. If so to which aero clubs in New South Wales do the recipients of such flying scholarships belong?
Senator SCOTT:
LP

– The Minister for Civil Aviation has furnished the following answer:

  1. In the year ended 30th June 1968, Commonwealth Flying Scholarships were awarded to members of the following aero clubs in New South Wales:

Camden Aero Club.

Canberra Aero Club.

Manning River Aero Club Ltd.

Narromine Aero Club.

Royal Aero Club of New South Wales.

Royal Newcastle Aero Club.

South Coast Aero Club.

  1. Yes. The clubs to which the recipientsbelong are:

Manning River Aero Club.

Royal Aero Club of New South Wales.

Royal Newcastle Aero Club.

South Coast Aero Club.

page 2326

QUESTION

AUSTRALIAN BROADCASTING COMMISSION

(Question No. 766)

Senator WHEELDON:

asked the Minister representing the Postmaster-General upon notice:

  1. Is it a fact that on 12th August 1968, the Australian Broadcasting Commission’s television programme ‘This Day Tonight’ included an interview with two men of the same extreme political persuasion and no attempt was made to balance their extreme comments?
  2. Were these two men Australian Democratic Labor Party Senators Little and Byrne? If so, what influence do these two men have on the Australian Broadcasting Commission so as to command such a platform for their propaganda?
  3. What action does the Postmaster-General intend to take to balance this programme?
Senator Dame ANNABELLE RANKIN:

– The Postmaster-General has furnished the following answer:

  1. Senators Little and Byrne were interviewed on the programme ‘This Day Tonight’ on 12th August. The interview followed their taking up seats in the Senate. No other members of a political party were interviewed on that programme on that date.
  2. Yes. None.
  3. As I have stated many times previously, the Australian Broadcasting Commission has complete autonomy in the conduct of its programmes. A balance of political comment has been achieved over a period.

page 2327

QUESTION

DRUGS

(Question No. 771)

Senator ORMONDE:

asked the Minister representing the Minister for Health, upon notice:

With reference to the proposal of the Wayside Chapel organisation in Sydney, which does such wonderful reclamation work among youthful victims of drugs, to establish a ‘half-way’ house at Rushcutters Bay, where reclaimed addicts can be sheltered until full recovery, is there any way the Commonwealth can assist in this essential and worthy work?

Senator Dame ANNABELLE RANKIN:

– The Minister for Health has furnished the following reply:

Treatment and social rehabilitation of drug dependent persons are the responsibility of the State authorities. The Commonwealth at present docs not consider it should provide direct assistance in these fields.

page 2327

QUESTION

WAR SERVICE HOMES

(Question No. 787)

Senator KEEFFE:

asked the Minister for Housing upon notice:

  1. How many national servicemen were eligible for benefit under the war service homes scheme as at 1st November 1968?
  2. Do all national servicemen who serve in any country or territory outside Australia qualify for a war service home loan?
Senator Dame ANNABELLE RANKIN:

– The answer to the honourable senator’s questions are as follows:

  1. Approximately 7,500 to 31st October 1968.
  2. No. To be eligible for war service homes benefits a national serviceman must have served on Special Service’ pursuant to allotment for special duty in a special area for the purposes of the Repatriation (Special Overseas Service) Act. (Question No. 788)
Senator KEEFFE:

asked the Minister for

Housing, upon notice:

  1. Are national servicemen who’ serve only in Australia eligible for a war service homes loan?
  2. How many national servicemen, who have been discharged, have applied for war service homes loans, how many applications have been grunted, and how many rejected?
Senator Dame ANNABELLE RANKIN:

– The answers to the honourable senator’s questions are as follows:

  1. No.
  2. Available statistics do not differentiate between applications received from national service men and from other members of the forces, nor between those serving and those discharged.

page 2327

QUESTION

INDONESIA

Senator ANDERSON:
LP

– On 23rd October 1968 Senator Cormack asked the following question:

I direct a question to the Minister representing the Minister for External Affairs. Can the Minister inform me or the Senate when the Government of Indonesia will accept and accede to the United Nations sponsored Convention of Vienna which sought to establish a convention of diplomatic immunity and privileges within a country in the comity of nations? Secondly, will the Government seek from the Government of Indonesia an undertaking to observe the sanctity of embassies of the members of the comity of the Asian and Pacific Council nations from so-called spontaneous mobs protected by the Indonesian Army?

In reply to Senator Cormack’s question. I undertook to obtain the information from the Minister for External Affairs. He has now provided the following information:

The Republic of Indonesia is not a signatory to the Vienna Convention, and I do not know whether it intends to accede to it. As regards the sanctity of embassies, the Australian Government has never had any reason to question the degree of protection afforded to the Australian Embassy in Djakarta, and does not consider it necessary to seek the type of assurance suggested by the honourable senator. It has not seemed appropriate, either, for us to seek such assurances on behalf of other nations.

page 2327

QUESTION

AUSTRALIAN BROADCASTING COMMISSION

In directing my question to the Minister representing the Postmaster-GeneralI apologise for doing so and express the hope that it will not irritate her too much. Is it not a fact that independent Australian Broadcasting Commission programme audience measurement surveys show that the number of people watching the television programme ‘People’ in Sydney and Melbourne has dropped by 50% since the Australian Broadcasting Commission commenced the programme ‘This Day Tonight’? Is the ABC expected to retain on its staff highly expensive comperes merely because they pander to left wing views and despite the fact that the Australian public is no longer interested in watching their programmes? Is it not also a fact that Mr Sanders, aware of the drop in his programme ratings, has been seeking other employment during the past 4 months?

These questions were referred by the PostmasterGeneral to the Chairman of the Australian Broadcasting Commission, Sir Robert Madgwick, who has provided the Postmaster-General with the following information:

  1. Surveys in Sydney and Melbourne have shown that the programme ‘People’ had its highest audience in 1967. During 1968, its audience has been consistently less than the average nightly audience for “This Day Tonight’. The most recent surveys show that the audience for ‘People’ in Sydney and Melbourne is approximately 55% of the average nightly audience for ‘This Day Tonight’.
  2. Sir Robert also said that Mr Sanders was employed by the ABC on contract and the decision not to renew his contract when it expires at the end of this year was based on programme considerations alone. Sir Robert has no personal knowledge of any attempt by Mr Sanders during the past 4 months to seek employment with commercial television stations, though it is possible he has done so.

My question is directed to the Minister representing the Postmaster-General. To settle the argument as to whether Bob Sanders was sacked by the Australian Broadcasting Commission because of his alleged preference for left wing interviews or because of his audience ratings, will the Minister table in the Senate the audience ratings of all interview sessions conducted by the ABC?

The Postmaster-General has now furnished me with the following information in reply:

I discussed the honourable senator’s question wilh the Chairman of the Australian Broadcasting Commission, Sir Robert Madgwick, who has informed me that the results of television audience surveys conducted by commercial organisations are confidential to the subscribers, lt can be said, however, that recent surveys conducted in Sydney and Melbourne showed that the audience for the television programme ‘People’ is about 55% of the nightly average audience for ‘This Day Tonight’, and about 60% of the average audience for ‘Four Corners’.

page 2328

QUESTION

ELECTORAL

(Question No. 707)

Senator MULVIHILL:

asked the Minister representing the Minister for the Interior, upon notice:

To avoid the possibility of an increase in the number of informal absentee votes at the next Federal elections, does the Commonwealth Electoral Officer contemplate any form of electoral education to alert voters, residing in subdivisions changed by the recent redistributions, of the new names of their Commonwealth electoral divisions?

Senator SCOTT:
LP

– The Minister for the Interior has provided the following answer to the honourable senator’s question:

Following the proclamation relating to divisions and subdivisions consequent upon the recent redistribution, Commonwealth Electoral Officers will notify electors affected of the change of enrolment by notice in the Commonwealth and State Gazettes and in some newspaper (or newspapers) circulating in the locality affected. Where it is considered essential or advisable a notification in the form prescribed by the Electoral and Referendum regulations, will be sent by post to the individual electors concerned.

page 2328

PROPOSED EXPENDITURE 1968-69

Pursuant to leave granted by the Senate on 21st November, Senator Keeffe incorporated in Hansard a copy of the Budget Speech delivered by the Treasurer of the Territory of Papua and New Guinea, Mr A. P. Newman, M.H.A., on the occasion of the second reading of the Appropriation Bill 1968-69, and various tables extracted from the associated Budget Papers 1968-69.

page 2328

BUDGET SPEECH

I have always considered myself privileged to present the Budget proposals of the Administration and this year the duty is more pleasurable because my colleague, the Assistant Ministerial Member for the Treasury, will share the task. Honourable Members will be aware that in recent years a review of the state of the economy has been associated with the presentation of the Budget detail and it is in that respect that Mr Oala-Rarua will inform the House.

It is also my duty to inform you of the expectation that the senior Official Member will, later in this meeting, table for the information of the House an updated development programme for Papua and New Guinea covering the five-year period commencing 1968-69. Obviously, such a development programme must, in broad outline, envisage not only the Budget for this year but also future Budgets. It will be apparent, therefore, that this Budget to which I speak is related to the development programme, and the targets which that programme includes are also the targets of the 1968-69 Budget.

The objectives of the Budget are illustrated at attachment 1 where the expenditure proposed during 1968-69 is distributed in functional comparative form. From a study of this, it will be obvious that the intention is to expend an increasing proportion of our resources on the economic sector, with a decreasing proportion on the social services and other sectors of the Budget. In fact, a reference to attachment 1 will confirm that whilst the commodity producing sector is in a slightly lower percentage, the economic overheads are in a much higher percentage, so that the total of the whole economic sector should grow by at least 2.2% or in absolute terms $9,400,000. In the social services sector, which includes among other activities, Education, Health and Housing, 33.9% of the Budget will be spent in a total sum of $51,859,000 compared with 36.5% representing $48,752,000 in 1967-68. The 23.1% of the Budget to bc spent on General Administration, Law and Order, compares with 23.5% spent in 1967-68.

EXPENDITURE

It is planned 10 spend a total of $152,860,000, an increase of 14.5% over the expenditure in 1967-68. In summary the plan is:

Special Appropriations lt will be seen thai Special Appropriations are some $3,340,000 higher than was the case last year. The term ‘Special Appropriations’ refers to the appropriation of general revenue written into the Ordinances covering the various headings of expenditure and these are detailed in the Budget papers, lt will be noted that this year for the first time, parliamentary salaries, allowances and travel are included in the grouping of Special Appropriations. The passage of a bill during the June meeting of the House provided that all such costs be met out of the revenues of the Territory which are specially appropriated accordingly.

The increase in the cost of superannuation is explained by the increasing number of officers retiring from the Public Service of Papua and New Guinea, and the proportion of their pensions which must bc borne by the budget is reflected here. The Loan Redemption and Interest Bill will grow year by year with the increase in the public debt. However, in 1968-69 the impact is rather extraordinary because a loan of $1,000,000 which was negotiated in 1967-68 had a currency of only one year and redemption has to be met out of revenue in this financial year.

An additional item included in the schedule of Special Appropriations, is that entitled Pre-war pensions in the sum of $295,000. This item, which relates to the payment of pensions to officers of the former Administrations of Papua and the Trust Territory of New Guinea, has in the past been paid from the Commonwealth Budget and in fact the Commonwealth has specifically appropriated this sum for the purpose in its 1968-69 Budget. The intention is that such expenditure should be reflected in the accounts of Papua and New Guinea, because the payments are made as special appropriations with the force of Territory legislation.

In total, the sum included for Special Appropriations represents 120% increase, but this unusually large increase is accounted for by new items including parliamentary allowances and prewar pensions and also the fact that, as mentioned, a $1,000,000 loan will be redeemed during the year.

Departmental

The objectives of the Budget are illustrated in physical form in the revised presentation of expenditure and physical performance which has been distributed. Honourable Members will note that in addition to the financial and physical objectives, the functions of Departments are set out. This information will no doubt be amplified and explained by my Ministerial colleagues as they speak to their Departments’ estimates.

The proposed expenditures on Departmental activities are set out in comparative form in attachment 2. It will be seen that these expenditures represent a growth of 11.8% over the expenditures in 1967-68 with the increase distributed over Salaries and Wages $3,613,000, Administrative Expenses $1,129,000 and Other Expenses $4,496,000. At this juncture 1 must point out that in a developing Territory such as this, the annual costs of the Public Service must grow for a number of reasons including growth in numbers necessary to carry out the task, cost increases from year to year and new activities flowing from the passage of legislation, to quote but a few. The problem, of course, is to contain that growth within our resources.

A growth of 8.3% in salary costs results from the costs of recruits in 1968-69 estimated at $1,652,000, salary increases for nurses and medical assistants estimated at $200,000, the balance being normal growth including increments, and a full year’s costs of 1967-68 recruits.

Honourable Members will be aware that a review of the administrative procedures in the Public Service has commenced. At this stage no positive results have emerged, but it is anticipated thai the task, which will take some time to complete, will produce savings and increased efficiency which in turn will be translated into budget savings. In the meantime, however, and because the overall task continues to grow, the Departmental provision includes finance for a recruitment of 471 and 1,828 additional overseas and local officers respectively. The proposed recruitment, together with the strength states of the various Departments, are set out in attachment 3. They are also disclosed in detail in an attachment to the Appropriation Bill, with suitable cross references between the Bill and the attachment, lt is considered that this provides a ready reference to statistical detail which is of interest, not only to members of this Chamber, but to the community at large.

In connection wilh the recruitment of 471 overseas officers 1 wish to emphasise that there will bc no recruitment of additional base grade clerks to the Public Service. This decision is related to the concept that recruitment of overseas officers must only be permitted in those categories of employment for which there are insufficient trained local officers. No doubt, with the passage of years, overseas recruitment will be restricted to professional categories and those skills which the education system of the Territory cannot produce in sufficient numbers. While additional base grade clerks will not be recruited from overseas, the number of suitable local officers coming forward for clerical positions does not meet the demand at present. Recruitment, therefore, to replace losses of overseas clerks must continue for the time being.

On the question of recruitment and replacement of overseas personnel, emphasis is being placed on in-service training in all Departments to ensure that local officers arc given on-the-job training in addition to formal training. For this purpose, training officers will be recruited in 1968-69 for all those Departments which do not already have such officers.

Obviously, therefore, the facilities of the Administrative College, business training, and Labour Department organised courses are being reinforced. Additionally, the Public Service Commissioner will set up a localisation section within his Department with the specific task of speeding up localisation of the Public Service.

Whilst the summary at attachment 2 reflects the proposed expenditures at the broad levels, and as mentioned earlier, there is a 11.8% expenditure growth proposed, it is essential to examine the Departmental detail to identify the growth.

There is included under Administrative Expenses of the Department of the Administrator a new item of ‘Office Furniture and Equipment*. The same item appears in most Departments’ appropriations, the explanation being that this item, which previously appeared under Capital Purchases, has been distributed over user Departments. Similarly, other items, which in the past have been classified under a heading of Capital Purchases, have been identified with Departments responsible for their control.

Included under the Other Services heading of the Department of the Administrator is an item of $113,000 being the estimate of cost in this financial year of the counterpart provision to cover the United Nations Development Programme transport survey. Honourable Members will be aware that this survey is currently taking place and is directed at the transportation needs of the Territory. It is in the main being financed by the United Nations Development Programme Special Fund, but there is a requirement that this Administration contribute part of the costs.

As I mentioned earlier, some $476,000 representing salaries, allowances and travel cost will, during 1968-69, be met out of Special Appropriations and hence the provision for the House of Assembly, which in the past included those costs, is at a reduced level. Obviously the comparison will be more accurate in future years. _ The provision for the Department of Information and Extension Services is directed al generally upgrading the service from existing radio stations at Goroka, Mount Hagen and Kerema. Equipment will also be purchased for stations which will eventually operate at Lae and Madang. It is increasingly evident that the role of this Department is all important for communication between government and the people of the Territory and therefore it is being given a priority more consistent with its role.

Under the general services heading of the Central Treasury provision, a new item ‘Housing Management Fees’ appears in the sum of $126,000. This expenditure is related to the role which the Housing Commission will play in managing residences occupied by Administration officers in Port Moresby, Lae, Rabaul and Madang. Additionally, there is included in the subdivision the items, Purchase of Motor Vehicles’, ‘Purchase of Printing Machinery’, ‘Purchase of Buildings’ and ‘Purchase of Plant and Machinery’ which in the past were disclosed as ‘Capital Purchases’.

The proposed expenditure on the Department of Public Health represents a growth of 9.8 per cent and the bulk of this growth will go towards increased costs of salaries and allowances. It will be noted, however, that there has been a general increase in the provision of funds for all of the servicing activities, thus illustrating that health services will expand. Likewise; the Department of District Administration will have increased expenditure representing a growth of 8.9% and this sum is largely distributed over salaries and administrative expenses, but then the activities of the Department are such that manpower, and the performance of manpower, are the main contributors to its operations.

The Department of Education with an expenditure growth of $1,479,000 will continue to expand to meet the primary, secondary, teacher training, technical and tertiary needs of the Territory. As in the case of other Capital Purchase items, school furniture and equipment is now shown under the departmental, heading.

The Department of Agriculture, because of its direct role in economic development has again been accorded a high financial growth rate, the expenditure proposed being some 20.8% in excess of that achieved during 1967-68. The increased expenditures are distributed mainly over salaries and other expenses. It should be noted that the provision for the livestock subsidy has been increased considerably, because of indications by cattle breeders that they will be importing an increasing number of stock to build up their herds. Further, there is a provision of $250,000 for the eradication of Pantorhytes in the Popondetta area. Honourable Members will note the inclusion under the Divisional heading of the Purchase of Plant and Machinery and the Purchase of Livestock.

The Department of Lands, Surveys and Mines has its financial provision increased by some 16.7% and this is consistent with the role of the Department in providing land, not only for rural, but also for urban purposes. The distribution of the increased provision is primarily in salaries and other services, and within the. Other Services subdivision it will be noted that the provision, for the purchase and lease of land, is $1,100,000, some $300,000 in excess of the expenditure of last year. lt is proposed to acquire some 103,000 hectares of rural land and some 4,000 hectares of urban land. The Department expects to make available a total of 2,700 leases for ail purposes.

The Department of Forests will expand its activity, even though its overall expenditures are proposed at a sum slightly less than what was expended last year. This is because the purchase of timber rights, which are now included in the departmental appropriation, are proposed at a level of $378,000 for 1968-69, which is almost $300,000 less than the sum expended ou this activity in 1967-68.

Honourable Members will recall that, at the June meeting of this House, a Bill was passed authorising the negotiation of a loan from the International Bank for Reconstruction and Development. The loan has been negotiated and it is anticipated that up to $1,000,000 will be drawn during 1968-69. This drawing will be reflected in expenditure on the purchase of equipment for the Department of Posts am) Telegraphs and in that regard 1 specifically refer you to the proposed expenditure level of $2,400,000 on the purchase and maintenance of telecommunications equipment. At the same time, however, the total provision for the Department is in excess of what ordinarily could be expected because of the commitment by the Administration to the $14,000,000 expansion programme on telecommunications, which will be spread over a number of years. 1 might mention also, that, in the interest of reflecting all expenditures, or as much of the expenditure as is possible on Posts and Telegraphs activity under the one heading, certain activities, for example maintenance of buildings and air charters, have been transferred out of general appropriations and are now located within the Department. This transfer, of course, contributes to the rale of increase in the proposed expenditure for 1968-69 as compared with that of 1967-68.

General Expenses 1 turn now to the category of ‘General Expenses’ which includes the Department of Public Works and what are known as ‘General Overheads’. In the provision for the Department of Public Works, there is included under the other services subdivision, an increase of some $210,000 in respect of the administrative on-cost which will be charged by the Commonwealth Department of Works, whilst the purchase of plant and machinery for the Department is also included within the provision this year. The administrative on-cost of the Commonwealth Department of Works is distributed over all ils clients and the Administration, as a major user of that Department’s resources, has to bear a significant share.

Works and Services

General maintenance in a total of $11,875,000 is some 12.2% higher than was the case in 1967-68. The expenditure on this activity must grow from year to year, as the total of capital assets, both in architectural and engineering form, grows in the Territory. Tn fact, some would argue that the sum expended on maintenance is insufficient and that the policy towards maintenance is therefore uneconomic. However the total resources available to meet all needs of the Territory arc limited, and therefore a decision has to be taken on just what is best in the prevailing conditions. There is a point also, that maintenance activity and capital works, to a degree, utilise the same manpower and material resources and therefore the level of expenditure on maintenance must impact the ability to carry out essential capital new works and services. At the sum provided, it is anticipated that essential maintenance can be carried out but no extravagance will be possible.

The Works Programme in a sum of $23.Sm would, at first glance, probably appear as a disappointingly low total. It does, however, represent a 5.8% growth over the 1967-68 expenditure and in addition to the Administration Works Programme, there is also the expenditure which will take place by organisations outside of the Administration, but which are being financed through the Administration Budget. These include the Electricity Commission, Ports and Harbours Board. Housing Commission, University, and the Institute of Higher Technical Education. It would be fair to say that a further $6,100,000 of expenditure out of the Administration Budget, will be available in the form of grants and loans for capital works activities by these Authorities, making a total of $29.9m in 1968-69, compared with $26. 6m last year, lt is also of note that the Works Programme is varied to the extent that $11,900,000 will be spent on architectural activities and the same sum will be spent on engineering activities. This will be the first time that the emphasis has swung away from architectural capital works, and the expenditure on engineering works will reinforce the emphasis that I have laid on the contribution to economic development.

Speaking to the Works Programme, Administration expenditure on accommodation is expected to total $5.1 m. However, to obtain an indication of the overall housing effort, Housing Commission expenditure of almost Sim and expenditure on institutional housing of $600,000, mainly houses for teachers and police, should be added, giving a total of $6. 7m.

Of the S5.lm to be spent by the Administration directly on housing, $2.45m will be spent on high covenant housing and $2.65m on low covenant housing. With the establishment of the Housing Commission a new approach will be adopted towards low covenant housing for local officers aimed at producing suitable houses as economically as possible, with standards in line with Territory conditions and incomes.

As one aspect of this, districts will now bs given greater responsibility in allocating and constructing houses within a cost limit of $2,500 a unit. By this means, it is expected that greater use of local labour and materials will be encouraged and more units built than before. Previously, the costs of low covenant housing in outlying areas, built almost entirely from imported materials, have been disproportionately high. Including institutional housing, more than 1,400 low covenant houses are expected to be completed or commenced in 1968-69.

Expected achievement from the high covenant provision of $2.45m and the high covenant institutional component, will also depend in part on the cost per housing unit. Investigations are still proceeding into the extent to which it would bs practicable to build a number of houses at a socalled intermediate standard, which would suit the needs of higher income local officers and t» acceptable also to overseas officers. Subject to decisions to be made in this respect, expenditure of the order indicated would enable more than 400 high covenant houses to be completed or commenced during the year. With the completion during the year of the special overseas housing programme, aimed to overtake the backlog in this field, expenditure on high covenant housing will be less than in 1967-68. The special programme involved an expenditure of $7.8ra producing 670 houses over 3i years.

The Housing Commission, which is now operational, has been allocated $960,000 for the construction of low cost housing and management of Administration housing in Port Moresby, Rabaul, Lae and Madang. The Commission’s programme will be mainly directed at low and minimum cost units within the range of $1,000 to $2,500 and more than 500 are expected to be completed or commenced during the year. Of these, 301 will be low covenant housing units in Port Moresby, to be transferred to the Commission from the Administration as part of the Commission’s progressively assuming Administration housing responsibilities. It would be expected that the activities of the Housing Commission will make it increasingly possible for urban workers, including local officers, to obtain suitable housing.

Within the provision for wharves and beacons, new works which will be commenced will include the Wewak and Gigo Wharves. These are outside the control of the Papua and New Guinea Harbours Board and will therefore still impact the Administration Budget. I should mention that under the heading of ‘Water Supply’, a new project, namely the water main from Rouna to Eriama, which will involve a gravity supply, is scheduled to be commenced and will constitute a major project for the future. Similarly, a water supply proposal for Mount Hagen is included which will constitute a residual liability for future years.

I would like to draw attention to the separation, within the Works Programme, of the provision for rural development work. The sum of $502,000 is directed at a detailed programme which has been drawn up from submissions received from all districts. Honourable Members will recall that this particular activity was instituted last financial year and the intent is a self-help approach, in that the fluids provided are matched by funds at the District level, for the primary purpose of small, but necessary, engineering works.

All in all, it is felt that the total of $1,666,000 now being provided in the Budget for minor architectural works, minor engineering works and rural development works, will result in a major contribution to development at District level.

It is not my purpose to speak at length on the Works Programme but only to invite attention to major objectives, as I am certain my colleagues will review the situation in detail during the course of the debate on this Bill.

Other Institutions

Other Institutions’ is a category of expenditure which is absorbing an ever increasing proportion of our total financial resources. The growth in this year is some 36.1 per cent and it is distributed over the University, Higher Technical Institute, Papua and New Guinea Development Bank, Electricity Commission, Papua and -New Guinea Harhours Board and the Housing Commission. The total University provision, embracing Special Appropriation, grants and scholarships is $3,650,000 whilst the Higher Technical Institute will attract finance in the sum of $1,445,000.

The Development Bank is included in a sum of $2,770,000, of which $270,000 is expected to be International Development Association funds which the Administration will borrow and on-lend to the Bank. As was the case in 1967-68, the Commonwealth Government has undertaken to consider increasing the . grant to the Administration, if the need of the Bank for funds seems lkely to exceed its resources and the Government considers it necessary to assist the Administration to make an additional contribution towards the Bank’s captial.

The Harbours Board finance, of $lm will be used in a wharf construction programme to cost $1.4m in 1968-69. Major works included are a new 500 foot berth in Rabaul, a new transit shed in Lae and the extension of transit sheds and reclamation in Port Moresby.

The Housing Commission has taken over projects in Port Moresby and Lae and will also commence new projects. It is anticipated that 270 accommodation units will be completed during the year and that a project’ of 301 I.M.Q. units in the Works Programme will be taken over by the Commission. The works which I have described illustrate the approach which it is expected the Housing Commission will adopt in carrying out its prescribed role in the- Territory.

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RECEIPTS

The income to finance the expenditure plan of $152,860,000 is expected to be available from:

The grant by the Commonwealth Government to this year’s Territory Budget is $87m, an increase of 12.1%. The increased grant reflects the Australian Government’s policy on the development of the Territory. In- that regard, I quote from the Commonwealth Treasurer’s budget speech when he said, ‘This grant has more than doubled over the last six years, which is convincing evidence of the Government’s unswerving aim to maintain the pace of economic and social development in Papua and New Guinea’.

Additionally, the Commonwealth will contribute $295,000 as I mentioned earlier, to meet the cost of pensions of retired officers of the pre-war Papua and New Guinea services.

These sums are supplemented by direct Commonwealth expenditure of $23m on the various activities in the Territory for which it accepts full responsibility. The total call on the Commonwealth Budget for 1968-69 is therefore at least $H0m.

Territory Loans are regulated, as to total, by our ability to raise the money and also our future ability to redeem the resulting accumulated liability. Contributions to the Territory loan programme are in the main received from Australian financial institutions, including banks and insurance companies, which operate here and to a lesser degree from Territory individuals, groups and organisations.

The loan figure of Si Om from internal and Australian sources when considered against our achievement of S8.4m last year looks realistic. To achieve it, the savings of the people of the Territory will have to be channelled into the Territory loan at a much higher rate than has ever been the case in the past. Financial institutions which operate in the Territory have all been approached and contributions are being received.

Borrowings from the International Bank for Reconstruction and Development and the International Development Association are shown separately because the income will flow as a result of the telecommunications loan which has been negotiated and a loan for agricultural development which is being negotiated with the International Development Association. The total is an estimate and the final result will depend on drawings within the loan agreements.

Included in the Internal Revenue is a sum of $1,000,000 to be raised by increases in rates of individual income lax ranging from 1.1% to 12.5%.

I must emphasise that the Territory can only expect to attract increasing Commonwealth grants if the level of Territory receipts, by way of internal revenue and loans, increases to the greatest practicable extent so that the trend is towards increasing internal and decreasing grant proportions of the total. Foi this year, Territory receipts are 43% and the grant 57% of the Budget total. Last year they were respectively 42% and 58%. I emphasise that this will operate within the economic framework of the World Bank report of which an important element was that the tax burden on private and company incomes should remain substantially lower than in Australia. Another important element was that the indigenous sector should contribute more to revenue. This is already happening, both directly through the mini’ tax and local government council tax, and indirectly through payment for services. As local government councils take on more responsibility for education and economic development, so the demand on the central budget will be reduced.

There is another important effect of the Public Sector or Government expenditure in our economy, lt must be obvious that our primary industries are of insufficient capacity to keep our economy expanding at a desirable rate and therefore until the private sector is strong enough, total Government expenditure will not only finance essential aspects of the country’s development and help keep our overseas payments in balance, but it will also be an economic primer. lt is drawn to the attention of Honourable Members that the Bills to introduce the new taxation measures also incorporate some relief for tax payers who save by means of superannuation or life assurance schemes and for those incurring education expenses in respect of their dependents. In the former case the maximum rate of concessional deduction will be raised from $1,000 to $1,400 and in the latter, from $800 to $1,000.

An analysis of the internal resources total reveals that 350,000 will be availed of out of the accumulated revenue surplus, $1,000,000 will be raised by new measures, $4,945,000 represents recoverable service charges and the balance of $47,770,000 will accrue from normal revenue raising activities. Within the last mentioned figure, $33,494,000 will be collected by way, of customs and direct taxation levies, lt will be obvious that the residue is representative of charges for services rather than a pool of revenue available for general use in the Territory.

The yields from Customs and direct taxation are the direct reflection of our revenue raising policy and here I would temper my earlier statement on an increasing contribution, with the statement made by His Honour the Administrator at the Morobe District Show last year when he said, In respect of taxation, it is policy to maintain at attractive levels, taxation which directly affects business operations in the Territory. It is in the interest of the country that the people individually and as business concerns should contribute as they can afford through taxation. As incomes rise this contribution will increase but it is our Arm intention through attention to economy and by efficient planning to keep the tax burden as light as practicable’.

I must mention that this year, for the first time, the Budget has been prepared to produce a net total. The special appropriations for taxation refunds and refunds of revenue have been set off against the estimated gross receipts from the various revenue heads.

As has repeatedly been emphasised, development is not just a matter for the government. The role of the private citizen is vital, whether they be Australian or Papuan or New Guinean. It is they who bring in badly needed capital and skills and provide both the initiative and the labour and management that are needed. I believe that this Budget with its substantially increased grant will give them confidence, particularly when the other Commonwealth expenditure of $23m is also taken into account, to keep the pressure on. The Australian government has certainly demonstrated its confidence in the Territory’s progress and stability. The Administration has done the same by participating through the Development Bank and in other ways in major development projects. But the main factor in building up confidence in tho Territory will be the attitude of Members of this House during its lifetime.

It may said that this Budget is just ‘More of the same thing as last year’. In a sense that is true. This is because we are following a broad plan of development which plan will be brought in in near final form to the House in this session. The Administration believes that, in general, its strategy, based on that plan, has been successful and will continue to be so.

page 2341

ASSENT TO BILLS

Assent to the following Bills reported:

Air Navigation (Charges) Bill 1968.

Loan (War Service Land Settlement) Bill 1968.

Phosphate Fertilisers Bounty Bill 1968.

Income Tax Assessment Bill (No. 4) 1968.

Sales Tax Bills (Nos 1 to 9) 1968.

Wheat Industry Stabilisation Bill 1968.

Wheat Export Charge Bill 1968.

War Services Homes Bill 1968.

page 2341

COMMONWEALTH SUPERANNUATION FUND

Ministerial Statement

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– by leave - With the concurrence of honourable senators,I incorporate in Hansard a ministerial statement on the Commonwealth Superannuation Fund. The statement reads:

The Government has given careful consideration to the position of members of the Commonwealth Superannuation Fund who, at later stages of their Public Service careers, become entitled to take up additional units of superannuation pension but, because the fortnightly contributions involved are then so high, find it difficult or impossible to do so. Major Public Service employee organisations have raised this matter with the Government as have members of both Houses of the Parliament. The problem arises from the nature of the Commonwealth superannuation scheme itself. Being a benefit purchase scheme it requires the full employee’s share of the cost of additional entitlements taken up to be met by the officer over the remainder of his career, however short that may be. Thus while additional units of entitlement attracted by increases in salary are relatively inexpensive in terms of increased fortnightly contributions when an officer is still young, they become increasingly costly as the officer nears retirement.

Not infrequently the cost of taking up additional unit entitlements at later ages more than exceeds - sometimes by a wide margin - the increase in salary that gives rise to the entitlement. Officers in the lower levels of Commonwealth employment are affected just as much as those in the higher grades. In fact, because of the tapering of superannuation entitlements above a salary of $6,630 a year, about which I will have something more to say later, the effect can be even more pronounced at the lower levels. On the other band, however, the effect of increased instalment deductions for taxation consequent on salary increases bears more heavily at the higher salary levels.

Honourable senators will be aware that under the scheme the Commonwealth contributes to the Fund concurrently with the payment of benefits rather than at the time that the officer contributes. The standard amount of the Commonwealth’s contribution for each unit of pension payable to a retired officer is $65 a year or $1.25 a week. The Commonwealth is required under the Superannuation Act to make this contribution in respect of the whole of the unit entitlement to which the officer has contributed. Thus, when an officer finds it necessary to forgo additional pension entitlement because of the cost of contributing for that entitlement the Commonwealth at present makes a saving at his expense. The officer in respect of whom this saving is made is usually one who has spent his working life in the service of the Commonwealth.

Against this background the Government has concluded that some relief ought to be provided for the assistance of officers who are faced with hardship in taking up additional pension entitlements accruing to them in the later stages of their Public Service careers. What the Government proposes to do is to make it possible within defined limits for officers to take up additional unit entitlements on a non-contributory basis. These units will, however, carry a lower rate of pension. This rate will be $1.25 a week, or five-sevenths of the value of the pension attaching to a contributory unit - $1.75 per week - the five-sevenths representing the Commonwealth’s share of each contributory unit of superannuation pension payment.

Eligibility to take up additional unit entitlements on a non-contributory basis at any time will be subject to each of two conditions. The first is that the officer must at that time have taken up on a contributory basis at least 50 per cent of his full unit entitlement. This will ensure that the officer has already made a reasonable minimum contribution towards providing for a postretirement pension. It will also operate to avoid certain anomalous situations that could otherwise arise. The second is that, subject to satisfaction of the first condition, eligiblity for non-contributory units will be restricted to units which, if taken up as contributory units, would cause the officer’s total fortnightly rate of contribution at the time they were taken up to exceed 7£% of his gross fortnightly salary for superannuation purposes.

Each of the two conditions will apply each time an officer receives an additional unit entitlement. If necessary an officer having previously qualified and elected to take some units on a non-contributory basis will have to take up on a contributory basis some further units to which he becomes entitled before becoming eligible for additional non-contributory units. For the purpose of the two conditions reserve units, which do not carry entitlement to pension unless and until converted to active units, will not count, although an officer already holding reserve units who is still able to meet the conditions of eligibility will not be disqualified from taking up units on a non-contributory basis.

It is also proposed that eligibility for non-contributory units will not at any time extend to any part of the unit entitlement applying to a member at the time when he first joined or joins the Fund. In respect of additional unit entitlements accruing to him subsequent to his joining the Fund the ordinary Rules relating to eligibility for non-contributory units will apply.

Contributors to the Superannuation Fund for pension benefits have the option of contributing for units of pension on the basis of retirement at either age 60 or 65. Contributing on an age 65 basis does not preclude an officer from retiring voluntarily on pension at any time after he attains age 60. If he exercises that right he has the choice of either making an appropriate lump sum payment on retirement to preserve the full pension value of his age 65 units or of taking an actuarily reduced pension in respect of those units. All noncontributory units will be on an age 65 basis but will, of course, be available to both age 60 and age 65 contributors.

In the event of voluntary retirement before age 65 an officer with noncontributory units will have the option of accepting a reduced pension value or. alternatively, of making a lump sum payment sufficient to preserve the full non-contributory pension value of $1.25 a week. Should service continue beyond 65 the noncontributory units held by an officer will carry on his retirement the same pension entitlement - $1.25 a week - as would have applied had the retirement taken place at age 65. In all cases the widow’s benefit attaching to a male officer’s non-contributory units will be five-eighths or one-half of the pension payable to the officer in respect of those units according to whether the widow’s benefit in respect of the officer’s contributory units is five-eighths or one-half.

Because in the past many officers have found themselves obliged to decline to take up some of the unit entitlements accruing to them by reason of their inability to afford the contributions involved, provision will be made to enable previously neglected units to be taken up on a non-contributory basis subject to the eligibility conditions I have outlined being met at the time the officer seeks to take up the previously neglected units as non-contributory units. As the Fund itself is not involved, the right to convert neglected units to non-contributory units will not be subject to a requirement of a medical examination. lt is also proposed that during a period of 6 months after the date of operation of the legislation officers will have the right to convert existing contributory units to noncontributory units within the limits set by observance of the eligibility conditions as at the date the legislation comes into force. In accordance with the provisions of the Superannuation Act relating to refunds of contributions, refunds in respect of such conversions of contributory units to noncontributory units will be the amount actually contributed by the officer for the units involved and will not include interest. There will be no provision for conversion of non-contributory units to contributory units or, except to the extent that I have already mentioned, for the conversion of contributory units to non-contributory units.

Earlier I made passing reference to the provision in the superannuation scheme for the tapering of unit entitlements above a salary of $6,630. At present the unit entitlement of an officer with a salary of up to this figure provides, if fully taken up, a pension equal to approximately 70% of salary. Above that salary, however, there is a tapering of unit entitlements which results in a maximum pension of approximately 50% of salary for officers at the highest level.

Concurrently wilh its consideration of the question of non-contributory units the Government has examined this matter and has decided that liberalisation of the tapering provision is desirable. Accordingly, it is proposed to halve the degree of tapering in respect of salaries above $6,630 so that maximum pension entitlement, if all available units are fully taken up on a contributory basis, will be approximately 60% of salary rather than 50% of salary at the highest level. Officers who will be eligible for and avail themselves of non-contributory units will, of course, reduce their pension entitlements below the maximum levels that would otherwise apply.

The change in the tapering provision, and possibly also some of the other changes in the Commonwealth superannuation scheme to which I have referred, could have implications in relation to some of the existing provisions of the defence forces retirement benefits scheme. This aspect is under study and the conclusions reached will be announced in due course. Legislation will be necessary to give effect to the decisions I have outlined and I expect this to be introduced in the autumn session of 1969. It is proposed that the new provisions will take effect from the date of operation of the legislation.

page 2349

GOVERNMENT PUBLICATIONS

Ministerial Statement

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– by leave - With the concurrence of honourable senators, I incorporate in Hansard a ministerial statement on Government publishing policy:

The Treasurer (Mr McMahon) advised the House of Representatives on 25th August 1966 on the position then reached with the various recommendations of the Joint Select Committee on Parliamentary and Government Publications and noted in particular that the main group of recommendations relating to the establishment of a Government publishing office was being carefully studied before being placed before the Government. I can now inform the Senate that the Government has accepted these recommendations.

A publishing office, to be called the Australian Government Publishing Service, will be established to be the sole publisher of all departmental publications and to arrange for their printing and distribution. Departments will be able, within funds availability, to determine what publications will be produced and the present Inter-departmental Publ’ications Committee will be abolished as soon as the necessary machinery has been established. The publishing office will advise on style and format, but departments will have the final say. The publishing office will ako determine sale price and numbers of publications to be printed for sale to the public.

The main difficulty associated with the proposal was to determine the most appropriate organisational arrangements to give full effect to the Committee’s general aims and objectives. I believe that our decision, which is in essence for both the printing and publishing functions to have their own direct management but for both functions then to come under a controller who will have authority for both, will provide an acceptable solution. In addition to the functions of publishing and printing the controller will be made responsible for the related common service functions of advertising and central1 procurement. In making this decision the Government wishes to emphasise the service function which will be undertaken by the new organisation.

The Joint Select Committee also recommended that the Printing Committees of both Houses be amalgamated and given some additional responsibilities for the review of Government publications after publication. The Treasurer has informed the House of Representatives that he proposes to seek the concurrence of the Presiding Officers of both Houses to this proposal.

In making this statement 1 would i:ike to pay tribute, on behalf of the Government, to the valuable work which was undertaken by the Joint Select Committee, under the chairmanship of the honourable member for Ballaarat (Mr Erwin). I would also advise the Senate of the retirement on 19th November of the Government Printer. Mr Albert Arthur. Mr Arthur, as I think al’l honourable senators will know, has given unstinted service to the Parliament and the Government and has justly earned our respect and affection. 1 think I speak for all honourable senators in saying how sorry I am that he has reached the point of retirement and in wishing him well for the future.

page 2350

SENATE SELECT COMMITTEE ON

page 2350

QUESTION

AIR POLLUTION

Motion (by Senator Laucke) - by leave - proposed:

That the date for presenting the report of the Senate Select Committee on Air Pollution be extended to 30 September 1969.

Senator MURPHY:
New South WalesLeader of the Opposition

– I am not criticising this motion, but is it possible for the members of the Committee to give us some indication of how this inquiry is pro ceeding, how long they have sat and what problems they are encountering? If the honourable senator could provide very brief information as to why it is necessary to have the extension of time the Senate would be grateful. The seeking of the extension of time affects the appointing of other committees, apart from anything else.

Senator LAUCKE:
South Australia

– by leave - The reason for the Senate Select Committee on Air Pollution seeking this lengthy extension of time is the magnitude of the subject matter being considered by the Committee. The Committee has visited and taken evidence in New South Wales, Western Australia and South Australia. It proposes to take evidence in Victoria in the week following the rising of this House and then to proceed to Tasmania and Queensland, thus visiting all the States. Evidence has been taken each week since the Committee was appointed. The terms of reference of the Committee are to inquire into and report on the causes and effects of air pollution in Australia, the methods of prevention and control and matters incidental thereto, lt might appear at first sighting that the subject could be encompassed rapidly and that the Committee would be able quickly to present a report which would be of major help in a federal assessment of air pollution and its effects on our nation. However, we found that the ramifications of the inquiry were extraordinarily wide and that it was very timely that the Committee had been established. Conditions in overseas countries, particularly those which are heavily industrialised, have shown that air pollution can be a very costly matter to the economy and the health and welfare of the community.

I would say that there is a general awareness throughout Australia of the dangers of air pollution and it is pleasing to note many of the preventive steps taken thus far. The time has come when we have to recommend an approach to this matter for the future with a view to avoiding those things which have occurred through a lack of attention to air pollution, which is a matter of increasing concern throughout the world. This necessitates an inquiry over a greater length of time than would be normal with an inquiry into a topic in respect of which statistics could be presented or direct inquiry made into a given situation. The subject matter of our inquiry cannot be encompassed within the ambit of direct statistics. It goes beyond that. After due consideration the Committee decided to seek leave of the Senate to extend its activities to the date mentioned. If the Committee can present its report much earlier than this, and we hope we can, we shall do so. The idea was to seek this lengthy extension in the event that we were confronted with a situation which required the making of a second application to this august House for further time in which to present our report. 1 say quite emphatically that the Committee’s intention is to present its report at the earliest opportunity but we want to give the subject matter the full depth of inquiry that its importance rightly deserves.

Senator CORMACK:
Victoria

– I wish to speak against the motion. Not often do I find myself in agreement with Senator Murphy. But I am prepared occasionally to find myself in agreement with him. I speak against the motion because it is quite surprising to me to hear it roiled out on to the floor of the Senate for the first time. I am prepared to agree that the setting up of the Select Committee by the Senate was timely, as Senator Laucke said. I am prepared also to acknowledge, but not to agree with the ramifications of it. As a constitutionalist, I take the view that the Senate must always control its committees. To give an open cheque, as it were, to any committee of the Senate to go on for 12 months before it renders a report is to abdicate from the floor of the House control of the committees that the Senate appoints.

On the question of ramification, 1 speak as one who has been selected by the Senate to chair an initial select committee in modern times, anyway. The problem that a select committee always finds itself involved in is to curb its ramifications. If parliamentary committees did not impose self-discipline upon themselves the extent of their inquiries and efforts could end in a situation where it would not be possible to bring down a coherent report. 1 have been involved in a situation where, with Senator Gair, Senator Bishop, Senator Cavanagh, Senator Wheeldon and other honourable senators, I have had imposed upon me, by direction of the Senate, the task of examining the ramifications of one of the great problems confronting Australia. At the end of 4 months, we were required to bring down a report. It was quite clear at that stage that we could have brought down a report which, substantially, the Senate would not have accepted. But we were modest in our requirements and, with great humbleness, requested the Senate to grant us another 6 months. This extension of 6 months gave the Committee which I had the honour to chair, confining itself within the proper ramifications of its responsibilities, the opportunity to complete its inquiries.

For any House of the Parliament to extend to a committee time to conduct an endless pursuit of all sorts of tentacles of a problem is to free the Committee in the first place from a discipline which it should properly impose upon itself, in the absence of the imposition of this discipline on the Committee by itself, the Senate itself must impose the discipline upon the committee. If the motion were to extend the time for another 6 months, I would agree to it, but I cannot agree to an extension of 12 months.

Senator MURPHY (New South WalesLeader of the Opposition) - by leave - While bearing in mind what has been said by Senator Cormack, I have listened to the reasons that have been advanced by Senator Laucke and they are certainly acceptable to the Opposition. Senator Laucke has indicated that the Committee desires to bring in a report at the earliest possible opportunity, and that it will do so. 1 am sure that everyone in the Senate is confident that that is what the Committee will do. The Opposition therefore supports the proposal.

Question resolved in the affirmative.

page 2351

SENATE SELECT COMMITTEE ON MEDICAL AND HOSPITAL COSTS

Senator Dame IVY WEDGWOOD (Victoria) [3.36] - by leave - 1 move:

That the date for presenting the report of the Senate Select Committee on Medical and Hospital Costs be extended lo 30th September 1969.

I should like to say in explanation of this request that the terms of reference of this Committee are very wide. If the Committee is to do justice to what is regarded as one of the most important social problems of our time it needs this extra time to take and sift evidence in order that it might bring down a report that will be worthy of the Senate.

Question resolved in the affirmative.

page 2352

SENATE SELECT COMMITTEE ON WATER POLLUTION

Senator DAVIDSON:
South Australia

– by leave- I move:

In explanation of this request 1 point out that the Senate Select Committee on Water Pollution only commenced its researches and examinations within the last 3 or 4 weeks. As honourable senators are probably aware, the Committee has not yet moved beyond the area of the Australian Capital Territory. The Committee proposes to commence investigations into matters relating to the other States in January of next year and hopes to bring in a report in the latter part of next year while the parliamentary session is still in progress. The Committee would appreciate the privilege of this extension of time so that it may conduct a full examination into the matters before it.

Senator MURPHY:
New South WalesLeader of the Opposition

– 1 move:

That the debate be now adjourned. 1 move this motion hoping that the debate will be resumed at a Dater hour. There is one aspect relating to the time which troubles me.

Question resolved in the affirmative.

page 2352

AUSTRALIAN PARTICIPATION IN OVERSEAS SHIPPING

Ministerial Statement

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– by leave - I wish to make a statement on behalf of the Prime Minister (Mr Gorton). It relates to Australian participation in overseas shipping. Where I use the first person singular personal pronoun in this statement, it relates to the Prime Minister. The statement reads:

I recently informed Parliament that the Deputy Prime Minister (Mr McEwen), during his visit overseas, would be making inquiries in London concerning the possibilities of Australian participation in overseas shipping, and participation in the carriage of Australian produce in Australian vessels. On his return Mr McEwen reported to me the results of his investigations and conversations and the Government, after carrying the original investigations a stage further by sending Sir Alan Westerman and Captain Sir John Williams to London, has now fully considered the results and implications of these discussions. In the result the Government has now decided, subject to the satisfactory conclusion of the final stages of negotiation, to enter overseas shipping by operating Australian-crewed vessels in its own right in both the Australia-United Kingdom and Australia-North America shipping trades.

In the Australia-United KingdomContinent trade the Government will operate a container vessel, which is now under construction, and in the North American trade it will operate a vessel which is partly container vessel and partly a vehicle deck vessel. The plans of this ship have already been drawn and examined by, and have the approval of, Captain Sir John Williams of the Australian National Line.

The Australian National Line will manage both these ships operationally, thus bringing the experience and skills of the Line into the operation. The method by which this will be done is as follows: An Australian company, owned by the Australian Government, will enter into a partnership with Associated Container Transportation Ltd, which is a consortium of British shipping lines within the framework of the established shipping conferences.

The Australian Government will also acquire a share of the Australian land facilities, owned by the consortium, which are ancillary to the operation of container services, and will participate in their management. The Australian Government will charter one of the three modern container ships which this consortium now has under construction and will operate it for at least 5 years, as one of the ships of the partnership. The Government expects these vessels to obtain an adequate share of the total conference cargo carried to and from Australia in each trade.

In the Far East trade a decision has already been taken, as is known, for the Australian National Line to operate a vessel. These new decisions mean that Australia will be operating a vessel not only in the Far East trade, but also in the AustraliaUnited Kingdom-Continent trade and the

Australia-North America trade. We shall be inside all these conferences.

Great changes are taking place in international shipping and my Government feels that the time has come for Australia to begin to carry Australian produce in Australian operated ships and to gain a full understanding of these new developments in order to ensure that the national interests are best served in the changing times ahead. Further, the importance of overseas shipping to a great trading nation such as ours is to be measured not only in terms of the profitability of operating a ship - though all investigations suggest there will be this profitability - but also by the savings in foreign exchange, measured in terms of freight expenditure on imports and exports, and the security and stability of the shipping services that are necessary for our national welfare. These decisions to charter and operate Australian-crewed ships inside the Australia-United Kingdom and the Australia-North America conferences are far-reaching steps which we believe will bring great benefits to Australia.

The consortium with which we propose to enter into partnership is in close cooperation with Overseas Containers Limited, another powerful group of British shippinglines. That group has the use of a network of facilities in Britain and elsewhere and is in the course of establishing facilities in Australia. At present the members of the Associated Container Transportation consortium with which we intend to enter into partnership carry some 20% of the total Australian-British continental trade and 50% of the Australian trade with North America.

I emphasise that it is not our intention to buy any equity shareholding in Associated Container Transportion Limited or in any of the member lines which compose it. Instead we propose to charter and operate our own ship in each trade. There are a few outstanding matters to be settled in the final stages of negotiation and these will be the responsibility of the Deputy Prime Minister and the Minister for Shipping and Transport (Mr Sinclair). When this is done I am confident that Australia will have taken another step forward - a greatly advantageous step forward. We will be in the business of moving Australian goods in Australian ships.

page 2353

AUSTRALIAN CAPITAL TERRITORY COMMITTEE

The DEPUTY PRESIDENT (Senator Drake-Brockman) - The President has received a letter from Senator Prowse requesting his discharge from further attendance as a member of the Joint Committee on the Australian Capital Territory.

Motion (by Senator Anderson) - by leave - agreed to:

That Senator Prowse be discharged from attendance on the Joint Committee on the Australian Capital Territory.

The DEPUTY PRESIDENT- The President has received a letter from the Leader of the Government in the Senate (Senator Anderson) appointing Senator Maunsell to fill the vacancy on the Joint Committee on the Australian Capital! Territory.

page 2353

STATES GRANTS (SECONDARY SCHOOLS LIBRARIES) BILL 1968

Bill returned from the House of Representatives with a message intimating that it had agreed to the amendment made by the Senate to this Bill.

page 2353

JUDICIARY BILL 1968

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Wright) read a first time.

Second Reading

Senator WRIGHT:
Minister for Works · Tasmania · LP

– I move:

That the Bill be now read a second time.

The main amendment of the Judiciary Act proposed by this Bill will complement the recent Act limiting appeals from the High Court to the Privy Council. The Bill also proposes another amendment of the Judiciary Act concerning State courts exercising Federal jurisdiction. These matters unfortunately lie in one of the most difficult areas of Constitutional law.

As honourable senators know, the effect of the Privy Council (Limitation of Appeals) Act is to limit appeals to the Privy Council from the High Court in what may conveniently, but somewhat loosely, be called ‘Federal matters’. For reasons I shall explain shortly, it may, however, still be possible for appeals in some Federal matters to reach the Privy Council by way of appeal from the Supreme Court of a State, thus by-passing the High Court, lt may also be possible, although this has never -been decided, for appeals in Federal matters to reach the Privy Council on appeal from one of the lower courts of a State.

Section 39 of the Judiciary Act vests in the courts of the States Federal jurisdiction subject to certain conditions. So far as the State Supreme Courts are concerned, one of the conditions is that every decision of the Supreme Court of a State shall be final and conclusive except so far as an appeal may be brought to the High Court. This is an effective provision to prevent appeals to the Privy Council from a decision of the Supreme Court so far as appeals as of right are concerned but there is a question, both as to the constitutional power and as to the construction of the section, whether appeals by special leave are excluded. From the wording of the section it is not clear whether it is a condition of the vesting of jurisdiction in the lower courts that there is to be no appeal to the Privy Council, whether by special leave or otherwise.

The Statute of Westminster made it possible for the Commonwealth Parliament to make laws inconsistent with an Imperial, Act, but before the Commonwealth adopted it there was some doubt whether a Commonwealth Aci could abolish the appeal to the Privy Council by way of special leave from a State Supreme Court exercising Federal jurisdiction. Assuming that appeals by special leave do lie, it is now possible to abolish such appeals and the Government believes this ought to be done. It does not make good sense to keep the appeal by special leave from State Supreme Courts exercising Federal jurisdiction on foot when, if an appeal were taken in a matter to the High Court, the decision of the High Court would not be subject to an appeal to the Privy Council. It is now possible, also, to abolish any appeal, whether by special leave or otherwise, that may lie to the Privy Council from one of the lower courts of a State exercising. Federal jurisdiction and the Government takes the view that this also should be done.

As regards the second amendment, State courts are at present invested by section 39 of the Judiciary Act with Federal jurisdic tion ‘within the limits of their several jurisdictions’, that is, their limits as determined by State law. This vesting is, as I mentioned, subject to certain conditions. There are many Commonwealth Acts that have invested State courts with Federal jurisdiction beyond the limits of their jurisdiction as determined by State law. In more modern Commonwealth Acts it is the practice to make this vesting subject to such of the conditions in section 39 of the Judiciary Act as are appropriate in the particular circumstances. But some older Acts have been silent as to conditions, and in these cases there is some doubt whether the conditions in section 39 apply or whether the jurisdiction is invested unconditionally. It is, therefore, desirable that an amendment should be enacted to make it clear that the conditions in section 39 apply in such cases unless other provision is made by the Act concerned.

There is also need to ensure that the proposed new provision regarding Privy Council appeals by special leave applies to proceedings under the Acts that do contain conditions subject to which jurisdiction is vested in State courts. Unless it does, there may be appeals to the Privy Council from courts exercising jurisdiction vested by these Acts although no appeal would lie if the vesting took place under the Judiciary Act. The Bill makes the new provision regarding Privy Council appeals by special leave applicable to proceedings under these Acts. I commend the Bill to the Senate.

Debate (on motion by Senator Murphy) adjourned.

page 2354

PAPUA AND NEW GUINEA BILL (No. 2) 1968

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Wright) read a first time.

Second Reading

Senator WRIGHT:
Minister for Works · Tasmania · LP

– I move:

Earlier this year the Papua and New Guinea Act was amended by this Parliament to make provision for the constitutional development of the Territory. This

Bill proposes further changes in the Act firstly to make statutory provision for guarantees which the Government has given in relation to payments for superannuation and retirement benefits and the employment security scheme: and secondly to bring the Act up to date with respect to appointments of overseas officers to the Territory Public Service and powers of delegation for the appointment of overseas and local officers. Until 1963 officers of the Papua and New Guinea Public Service were almost all recruited from Australia and appointed as permanent officers. In 1963 permanent appointments of overseas officers were discontinued and in 1964 the Public Service was reconstructed to provide a career service increasingly manned by Papuan and New Guinean officers. Since then only local officers have been appointed as permanent officers and overseas officers have been appointed only on a contract basis.

In order to dispel fears expressed by permanent overseas officers about the effect on them of constitutional or administrative changes in the Territory the Government introduced the employment security scheme which has been established by an ordinance of the House of Assembly. The scheme applies to serving permanent overseas officers of the Territory Public Service and the Royal Papua and New Guinea Constabulary. The scheme provides an insurance against the possibility of an overseas officer’s career being terminated before normal retirement age through such constitutional or administrative changes. An overseas officer in these circumstances will be re-established in government employment elsewhere or if this is not possible he will receive cash payments and other benefits specified in the Territory legislation. The amendments now proposed to the Papua and New Guinea Act provide a Commonwealth guarantee in respect of such payments. Apart from these employment security arrangements it is also of major importance to permanent overseas officers that their superannuation benefits should be guaranteed. Similarly, it is of major importance to contract overseas officers that their retirement benefits should be guaranteed. The Government’s decision to make statutory provision for these guarantees follows representations by the officers concerned and the Government considers that these guarantees will contribute importantly to the morale and efficiency of overseas officers and to the stability of the Public Service and the Constabulary.

Clause 5 of the Bill lists the ordinances which set out the benefits to which I have been referring. The proposed new section 30a in clause 4 incorporates the Commonwealth guarantee of payments that may accrue to overseas officers under these ordinances. Copies of the ordinances conferring the benefits which would be guaranteed have been placed in the Parliamentary Library together with an explanatory booklet on the employment security scheme. The guarantee applies to the ordinances listed in clause 5, including future amending ordinances. Such future amending ordinances will require the Governor-General’s assent.

The second part of these proposals arises from the reconstruction of the Public Service. As already explained, overseas officers were previously engaged on a permanent basis and the present section 30 provides for them to be appointed by the GovernorGeneral. Following the reconstruction of the Public Service in 1964 local officers have continued to be appointed under the Papua and New Guinea Act on a permanent basis. Contract officers recruited in Australia, however, are not covered by the present definition of ‘officer’ in the Act, and they have been appointed under Territory ordinance. The proposed new section 30 and the new definition of ‘officer’ will enable overseas contract officers to be appointed under the Act just as overseas permanent officers used to be appointed under the Act. The proposed section 30 would also simplify the appointment procedure and would permit delegation of the power of appointment by vesting the authority for appointment of officers in the Minister rather than the Governor-General and by making the usual provision for delegation. It is proposed to establish a Public Service Board in the Territory, and delegations to that Board will be possible under these new provisions.

Those of the present proposals which deal with guarantees are designed to give confidence and reassurance to overseas officers. Australians serving in Papua and New Guinea in past years have created a fine tradition of dedicated service to the Territory and progress in the Territory is still heavily dependent on the services of Australians, whether permanent or contract officers. The five-year development programme calls for the recruitment of an additional 1,450 overseas officers to provide the Territory with special skills needed to carry out the programme. The statutory guarantees proposed in this Bill are intended to recognise service in past years and to recognise the service overseas officers will be relied upon to give to the Territory in the future.

Debate (on motion by Senator Keeffe) adjourned.

page 2356

INTERNATIONAL MONETARY AGREEMENTS BILL 1968

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Anderson) read a first time.

Second Reading

Senator ANDERSON:
Minister for supply · New South Wales · LP

– 1 move:

That the Bin be now read a second time.

The purpose of this Bill is to enable Australia to accept amendments to the articles of agreement of the International Monetary Fund and to participate in the proposed special drawing rights scheme. As indicated in his statement to the House on 30th May, as Governor of the Fund for Australia, the Treasurer (Mr McMahon) has already recorded his vote in favour of the amendments. The Board of Governors has now agreed to the amendments and the next step is for member governments to accept them. The amendments will enter into force when accepted by 60% of the government having 80% of the total voting power. When this majority has been achieved, the amendments will enter into force for all1 member governments regardless of whether they have accepted them or not. However, before the special drawing rights scheme can come into operation, member governments having at least 75% of the Fund quotas have to deposit instruments with the Fund certifying that they have undertaken all the legal steps necessary to carry out their obligations as participants. Member governments are expected to have completed this legal action when they accept the amendments.

Once the body of participants has been formed, the Managing Director of the Fund will be in a position to recommend to the Board of Governors that an initial volume of special drawing rights be created over a basic period of 5 years. In making this first recommendation the Managing Director must satisfy himself that a large enough majority of member governments is prepared to make a collective judgment that there is a need to supplement international reserves, that the major deficit and surplus countries have obtained a better balance in their external accounts and that there is the likelihood of a better working of the processes of balance of payments adjustment in the future. In all his recommendations for the creation or cancellation of special drawing rights he must take into account the need to avoid world economic stagnation ot inflation. Decisions by Governors on the creation or cancellation of special drawing rights will require an 85% majority vote.

Virtually all of the Governors of the Fund have indicated their support for the scheme and it is hoped that the required majority for its establishment can be secured quickly so that, providing the conditions I have mentioned are met, it can be activated without delay. At the annual meeting of the Board of Governors in Washington last month it was announced that seventeen member countries, including the United States and the United Kingdom, having 42% of the voting power had already accepted the amendments. The new articles of agreement of the Fund containing the details of the special drawing rights scheme are set out in the schedule attached to the Bill. Expressed in legal language the articles are necessarily complicated. However, the essential elements of the scheme are quite simple. The special drawing right will be an entirely new form of reserve asset which countries can add to their gold and foreign exchange as part of their official holdings of international reserves.

In the past, additions to international reserves have come largely from three sources - gold; the two reserve currencies, sterling and the United States dollar; and drawing rights on the Fund. In recent years, it has become evident that these sources of international liquidity will not be sufficient to finance the future growth of world trade.

Between 1951 and 1967 the proportion of international reserves to world trade decreased from 67% to 37%. For some time, gold production has added relatively little to official reserves and there was actually a reduction in official gold holdings in 1966 and 1967. There has also been a growing reluctance to depend on the balance of payments deficits of the United States and the United Kingdom as a source of supply of reserves. Member countries’ drawing rights on the Fund have been supplemented by two general increases in Fund quotas. However, apart from the ‘gold tranche’, which is available virtually on demand, Fund drawing rights consist of Credit tranches’. These credit tranches are conditional in that the greater their use the more vigorous the action drawing members are expected to take to correct their external deficits.

Unlike drawing rights in the credit tranches, the special drawing rights will have no strings attached to them. Once a country has been allocated special drawing rights it will be free to use them as it sees fit to finance deficits in its balance of payments. Unlike the reserve currencies, special drawing rights will be as good as gold in that changes in exchange rates will not alter their value. The term special drawing rights is somewhat misleading. They have been called special drawing rights to distinguish them from existing drawing rights on the Fund. However, they are not ‘drawing rights’ in the sense that they represent ‘rights’ to draw’ on assets in the future. Special drawing rights are in themselves assets which will be immediately added to each participating country’s existing reserves. There are, of course, rules governing the allocation of special drawing rights and their transfer among participating countries in the scheme.

Participants will be allocated special drawing rights in proportion to their Fund quotas. Australia’s quota is 2.4% of the total Fund quotas. Thus an initial allocation of $US5,00Om special drawing rights would result in Australia receiving special drawing rights amounting to $US120m spread over the basic period of 5 years. A country needing to use special drawing rights will transfer them to other participants in exchange for convertible currencies. The Fund will keep a running list of those participants whose balance of payments positions are such that they can provide the foreign exchange. A country will have an obligation to hold special drawing rights up to three times the amount it has received in allocations and a country using its special drawing rights will have an obligation to reconstitute its holdings when, averaged over a 5-year period, they fall below 30% of its allocations. A country acquiring special drawing rights over and above its allocations will receive interest at H% per annum and a country using its special drawing rights will pay a charge at the same rate. All participants will pay ‘assessments’ as their share of the administrative costs of the scheme. Receipts of interest and payments of charges and assessments will be in the form of special drawing rights.

The scheme will operate outside the Commonwealth’s public accounts. Special drawing rights received by the Commonwealth will be transferred to the Reserve Bank which will include them as assets along with its holdings of gold and foreign exchange. Transactions in special drawing rights with other countries will be carried out by the Reserve Bank under the direction of the Treasurer. The Reserve Bank will transfer back to the Commonwealth such special drawing rights as it needs to meet the assessments or charges to which I have already referred. In the unlikely event of Australia using all of its special drawing rights or of the scheme winding up, it may be necessary for the Commonwealth to provide moneys to meet any excess of assessments and charges over interest received. It is to cover possibilities such as these that the usual provision for appropriating moneys has been included in the Bill.

Australia has played an active role in the discussions leading up to the special drawing rights scheme. We have been successful in our efforts to ensure that the scheme takes account of Australia’s position on a number of important issues. In particular, the new facility will be under the management of the Fund and thus be open to all of its member countries, including the less developed countries, on a nondiscriminatory basis. As I have already pointed out, the special drawing rights will have no strings attached to them and the scheme will in no way affect our freedom of action either internally or externally. The second set of amendments to the Fund articles of agreement involves certain changes in the Fund’s present rules and practices which take account of developments and experience since the Fund was established in 1945. Details of the changes are contained in the schedule attached to the Bill.

There are changes in the voting requirements for certain important Fund decisions. Decisions on general changes in members’ quotas will require a majority of 85% of the total voting power instead of the present 80% and the new requirement will also apply to uniform changes in par values. There are various formal changes relating to existing drawing rights on the Fund. For example, gold tranche drawings, which are already automatic in practice, will become legally automatic. None of these amendments will make the Fund’s rules regarding the use of its resources any more restrictive. There is an amendment providing for interest to be paid to creditor members in the Fund. Creditors are those countries who have made available a net amount of their currencies for drawings by other members and Australia is in this position at the present time. Another amendment will enable the Fund to reduce or eliminate the service charge on gold tranche drawings. Changes are also proposed in the method of calculating repurchase obligations but these mainly affect the reserve currency countries. Finally, there is a change in the procedure to deal with questions of legal interpretation of the Fund articles. Our Executive Director on the Fund Board has participated in the discussions leading up to these amendments and I am satisfied that it is in our interest to accept them.

The main purpose of the amendments is, of course, to establish the special drawing rights scheme. The scheme represents an important development in the international monetary system and I commend this Bill to the Senate in order that Australia may playits part.

Senator WILKINSON:
Western Australia

– The Opposition does not oppose this Bill and is prepared to let it go straight through without the debate being adjourned.

Question resolved in the affirmative.

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

page 2358

STATES GRANTS (ABORIGINAL ADVANCEMENT) BILL 1968

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Dame Annabelle Rankin) read a first lime.

Second Reading

Senator Dame ANNABELLE RANKIN:
Minister for Housing · Queensland · LP

[4.13] -I move: That the Bill be now read a second time.

This Bill is to some extent interlocked with the Aboriginal Enterprises (Assistance) Bill which follows it immediately on the notice paper, and I shall therefore ask the indulgence of the Senate in making some references to this second Bill in my speech upon the first one. I would also suggest to the Senate that it might suit its convenience to debate both Bills together although, of course, separate votes would be taken.

I would stress at this stage that the Commonwealth regards an Aboriginal as a person of full or part Aboriginal descent, who claims to be Aboriginal and who is accepted as such by the community in which he lives. Torres Strait islanders and anybody who is a full blood Aboriginal or is of part Aboriginal descent come within the definition.

The primary purpose of the Slates Grants (Aboriginal Advancement) Bill is to make available a sum of$3,650,0000 in the form of non-repayable grants to the various States. The proportions in which this is to be divided between the States are set out in the Schedule and are in proportion to the Aboriginal populations of the various States, insofar as they can be ascertained, and as were unanimously agreed on by the representatives of the States when they met us in conference in Melbourne in July this year. The Senate will recall that in the Budget a sum of$10m was set aside for an Aboriginal Advancement Trust Account, and it was stated that$5m of this would be allocated for capital assistance to viable Aboriginal enterprises, and that the remainder would be used for non-repayable grants for Aboriginal advancement, particularly in the fields of housing, education and health. The sum of$3,650,000 to which I have referred is part of this second $5m. Of the remainder of that S5m, Sim is being held for expenditure in the Northern Territory and S350.000 has so far not been allocated.

The Senate will recall from my statement of 27th August that, of the amount allocated to the States under this Schedule, approximately $2,300,000 will be used for housing, approximately $850,000 for education and approximately $500,000 for health. My statement of 27th August sets this out in some detail, including the principles of the housing agreement with the States which accounts for the main part of the funds wc are granting, and I do not intend to take up the time of the House by repeating it now.

The Attorney-General (Mr Bowen) has advised that in order to pay the money over to the States it is desirable to make a grant formally under section 96 of the Constitution, and this Bill will enable disbursements to the States to commence forthwith, lt is our intention to pay (he grants to the States quarterly in advance, the amount of the instalments to be determined by agreement between themselves and us.

Honourable senators will notice that under clause 3 of the Bill the States are obligated to spend the whole of their grants in a manner and within a time approved by the Minister, for the advancement of Aboriginal people living in their State’. I should add that each State has agreed also to maintain at least its current level of expenditure from its own funds on Aboriginal advancement so that the grant by the Commonwealth Government will be in addition to, and not in substitution for, amounts spent from State funds.

Finally might I direct the attention of honourable senators to clause 4 of the Bill which provides for a repayable grant of $350,000 to the State of Queensland for the development of an irrigation project at Bamaga in the far north of Cape York. Il was intended originally that this grant should come out of the §5m Capital Aid Fund, but since some procedural difficulties have arisen which could delay this, and since it was desirable that the project should proceed wilh the least possible delay, it has been decided to treat this as a special repayable grant. The money will, of course, under the provisions of clause 6 of the Bill be repaid from Queensland into the Capital Aid Fund.

The Queensland Government is convinced of the soundness of the Cape York development, which is based on the remarkable flow in the Jardine River. Even in the dry season this flow does not appear to drop below 50 cusecs. Adjacent to this river there are Aboriginal reserves which are capable of development and there is still in the area a considerable Aboriginal population to take advantage of these opportunities. We shall be discussing with the Queensland Government the details of the way in which this project can be developed so as to give the maximum benefit and security to the Aboriginal people who will be engaged in it. Some of these details are not yet settled but I would not want the discussion of them to delay the prosecution of this very excellent scheme.

The second Bill deals with the Capital Aid Fund and arranges for the payment into it of an amount of $4,650,000 which, together with the $350,000 for the Cape York venture to which I have already referred, makes up the $5m which the Treasurer (Mr McMahon) originally allocated to this Fund. Honourable senators will note that in terms of clause 7 of the Bill this S5m is to be included in a permanent revolving Fund for the establishment and encouragement of Aboriginal enterprises. Clause 5 of the Bill states:

The object for which the Fund is established is to enable persons of the Aboriginal race of Australia lo engage in business enterprises that have prospects of becoming or continuing to be successful and the Fund shall be administered Tor that object.

Clause 8 deals with the mechanics of the process.

Honourable senators will recall that in his statement to the conference of Commonwealth and State Ministers responsible for Aboriginal affairs in Melbourne on 12th July, which has subsequently been tabled in the Senate, the Prime Minister (Mr Gorton) announced the creation of this Capital Aid Fund for special assistance for potentially viable enterprises by Aboriginals either individually or co-operatively. The Prime Minister stated that the Government regarded this scheme as an essential part of its policy for assisting Aboriginal Australians to become self supporting and economically independent.

An encouraging number of applications, spread over all mainland States, has already been received for assistance from the Capital Aid Fund. The MinisterinCharge of Aboriginal Affairs (Mr Wentworth) is anxious to proceed as soon as possible with the task of assisting Aboriginal enterprises and hopes to make announcements relating to loans to such enterprises shortly. He will be setting up an advisory committee to help him in making the necessary decisions, and I will be glad to be able to draw on the financial experience of Dr Coombs, the former Chairman of the Reserve Bank, as Chairman of this Committee.

The authorities in charge of Aboriginal welfare in a State will be consulted before any particular project in that State is approved. In fact we would hope that most applications would come to us through the States, but this does not preclude the possibility of an Aboriginal or Aboriginal group making an application direct to the Fund at the Office of Aboriginal Affairs in Canberra.

I should make it clear that the enterprises which will be supported by loans, by guarantees or otherwise are those which, as stated in clause 5 of the Bill, have prospects of becoming or continuing to be successful. It is the intention of the Minister that loans from the Capital Aid Fund normally be made on terms appropriate to development type loans, moving towards normal commercial standards over a short period of years, and often through the normal banking institutions. In this regard, honourable senators will note powers of the Minister under clause 9 to give guarantees subject, of course, to the limitation set out in that clause.

In appropriate cases, a holiday from payments of interest and repayment of capital may be granted until the enterprise reaches a level of net profit which would enable it to support these payments while still providing a livelihood for the Aboriginal entrepreneurs.

The Bill also provides that moneys from the Capital Fund may be applied to acquire shares in the capital of a company. The thinking behind this is that in many cases it may be found desirable for the Capital Aid Fund to support an enterprise by hold ing equity shares. Such equity capital would be held by the Capital Aid Fund until such time as the enterprise was able to buy it back out of profits. The Bill provides for the audit of the Capital Aid Fund operations, and for the submission of a report to Parliament each year.

These two Bills taken together express the two aspects of the Government’s policy in regard to Aboriginals, namely, to make available better housing, education and health facilities immediately and, at the same time, to provide an economic basis which will enable Aboriginals to reduce their dependence upon handouts and become more and more self-reliant. I commend the States Grants (Aboriginal Advancement) Bill 1968 to the Senate.

Debate (on motion by Senator Cant) adjourned.

page 2360

ABORIGINAL ENTERPRISES (ASSISTANCE) BILL 1968

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Dame Annabelle Rankin) read a first time.

Second Reading

Senator Dame ANNABELLE RANKIN:
Minister for Housing · Queensland · LP

[4.22] - 1 move:

That the Bill be now read a second time.

In view of my remarks about the previous Bill, I commend this Bill to the Senate.

Debate (on motion by Senator Cant) adjourned.

page 2360

GOLD MINING INDUSTRY ASSISTANCE BILL 1968

Second Reading

Debate resumed from 13 November (vide page 1943), on motion by Senator Anderson:

That the Bill be now read a second time.

Senator CANT:
Western Australia

– 1 will be as brief as possible in my comments on this Bill. An excellent speech about assistance to the gold mining industry was made in the other place by my colleague the honourable member for Kalgoorlie (Mr Collard), and I commend that speech to honourable senators. The importance of the gold mining industry was recognised by the Commonwealth Government in 1954. The Right Honourable R. G. Menzies, as Prime Minister, at that time, said:

The importance of the gold mining industry to Australia needs little emphasis. The annual value of gold output is in the region of £17,000,000. Not only does the industry make a significant contribution to the national income, but it produces a commodity which has a direct effect on the balance of payments. Except for a minor quantity of gold which is used for industrial purposes, all the gold produced in Australia and the territories represents an addition, in one form or another, to our international reserves. Moreover, there are large areas in Australia, particularly in Western Australia, which are almost entirely dependent on gold mining. Any significant decline in gold mining activity could lead to the depopulation of these areas and a widespread loss of housing and other utilities which have been developed over the years in the areas concerned. The Government believes that for a number of reasons il would not be in the national interest for these areas to languish.

I draw to the attention of the Senate the continuing importance of the gold mining industry. One has only to look at the newspapers throughout the world today to see the importance of the gold mining industry, particularly with the near failure of the managers of money throughout the world to manage the international monetary system. Yet we find that this Government is not prepared to play its part by assisting this industry. The populations in gold field areas in Australia gradually have decreased. This has been happening over many years. Yet the Government has done nothing to try to stem this flow of people away from gold mining areas. There has been an 80% decrease in employment of labour in the gold mining industry in Western Australia since 1950. The number employed has decreased from 7,048 in 1950 to 4,127 in 1967. The figure for 1967 represented the lowest number of persons employed in that industry since 1892, when the eastern gold fields were founded, even allowing for the considerable depression in the industry during the period from 1922 to 1929.

For very many years, Australia and its people, including the business people and other sections of the community, have ridden on the sheep’s back. Today we are attempting to swing away from sheep and into the export of the products of the mineral industry. Over the years, because of the emphasis on wool, there has been a continuing decrease in the number of skilled workers employed in the sheep industry, so much so that various federal awards and the Queensland award applying to this industry have provided that contractors and employers engaged in it have had to take on a number of learners. This was done in order that the flow of skilled labour would continue. Schools were set up in various States at which people were taught how to shear sheep in order that half the wool would not be left on the sheep’s back and in order that fleeces would be presented in a proper way on world markets.

There has been a continuing shortage of skilled labour in the sheep industry but nothing like the shortage of skilled miners. If we are to develop our mining industry as it should be developed we need many more skilled workers. Considering the great developments in the mining of various metals, not only in Western Australia but throughout Australia - and there are vast mining activities in Western Australia - there is a very big shortage of skilled labour available to operate this industry. If an additional subsidy for the gold mining industry did nothing more than provide skilled labour, this Government would be spending money very wisely. A miner cannot be taught to mine ore in 5 minutes, particularly in underground workings. It is a pretty long process. I have vivid recollections of the shortage of skilled miners during the mining boom in the depression days. Many lives were lost because inexperienced men were sent down to do jobs they were not capable of doing. In view of the expansion of the mining industry, we could easily have this problem on our doorstep again.

It is futile for any honourable senator to stand in his place and say that gold is not important. It is important. I read a newspaper report this morning which stated that in order to protect the French franc the French Government has put an embargo on exports of gold from France. Each time there is a monetary scare in a country, gold becomes very important to that country. We have gold resources in Australia but we do nothing to develop them. We do nothing to increase our gold production which has been gradually falling over a number of years. Many marginal mines in Western Australia could operate if a reasonable price were paid for gold. I remind honourable senators that apart from the subsidy paid by this Government, there has been no increase in the price of gold since 1949. The inflationary spiral to which this Government has subscribed has been absorbed by that industry. For that reason it is clear that it is the most efficient industry in Australia.

Senator Webster:

– How does the Australian subsidy compare with subsidies paid by other countries?

Senator CANT:

– 1 am not interested in the subsidies paid by other countries. I am interested in what is paid in this country. The honourable senator has just been around the world. He should have had a look for himself. The Minister for Supply (Senator Anderson) in introducing the International Monetary Agreements Bill today referred to the importance of gold in the international monetary field. He said:

The special drawing right will be an entirely new form of reserve asset which countries can add to their gold and foreign exchange as part of their official holdings of international reserves.

Is it not true that in Australia we live on the inflow of foreign investment which can be cut off at any time? Yet the gold mining industry is stagnating for want of a proper approach by this Government. Does the Bill provide for greater assistance to the gold mining industry? Of course not. Because of the activities of the International Monetary Fund a two price system has been set up in respect of gold. Australian gold producers are allowed to sell on the premium market. The Bill provides that only 25% of excess of prices received over the official price is to be allowed to subsidised producers. In fact, it sets out to save the Commonwealth Government about $300,000 that the industry would get through selling on the premium market. The premium market price for gold today is running at about $2.7 a fine ounce. This is not sufficient to allow gold mining companies to carry on or to allow new companies to enter the field. No-one wants to enter a mining industry that does not have a prospective life of 30 or 40 years. Possible entrants to the industry want to be able to see their way clear to make a return on their capital over a period. Fluctuating prices for gold are fixed by the whim and will of a government that has done nothing to support the industry. That contention is supported by figures relating to employment in and development of the industry. The Government has completely abandoned the statement made by the Prime M inister in 1 954.

One of the things that is hampering the gold mining industry today is a shortage of skilled labour. Moreover, the skilled operators who are available are not prepared to stay in gold mining areas where their future is uncertain - where they do not know whether a mine will be operating tomorrow, next week or next month. They want secure employment and the result is that they leave the gold mining industry and move into other industries operating in more congenial places. I suggest that it would be profitable for the Government to pay a high subsidy to the gold mining industry. The premium price for gold would have to be greater than $8 an ounce before many producers could show a profit, because of the way that the system of subsidy operates. Yet the Commonwealth Government will not come to the party, lt will want to take the royalties and the advantages of trade and taxation from all the other mineral industries operating throughout Australia, without contributing more than it is compelled to contribute to the gold mining industry.

I urge the Government to give greater assistance to this industry, and to make greater efforts throughout the world to bring about a realisation of the importance of gold in the international monetary field, so that the price of gold may be increased. I do not believe that this point has been pressed very strongly by Australia’s representatives on the International Monetary Fund. I have read what was said in another place about the efforts made by the late Mr Holt when he was Treasurer, and the efforts made by Mr McMahon since he has been Treasurer. Nevertheless, I do not think a concerted effort has been made to obtain an increase in the price of gold. This is very important not only to the value of our international reserves but ako to the training of skilled workers to operate in the gold mining industry to assist us to get full value from the minerals that are available for exploitation in Australia.

Senator WILLESEE:
Western Australia

– This Bill, which concerns Australia’s gold production, involves probably one of the most interesting problems that faces the Government. There is an imbalance between the States, in that Western Australia is the great gold producing State. It is a remarkable fact that throughout the world the price of gold is fixed, one might say, on the top side - toy the buyers - because the United States of America is the main buyer of gold. At the same time, pressures are exerted from the bottom up - by the producers - because of increased production costs. Ever since 1 have been in the Senate 1 have heard talk of an increase in the price of gold. J suppose that all Australians would want to see that achieved, as would all South Africans. Certainly Western Australians would like the price of gold to be increased. I am never quite sure of how much the people in the eastern States are interested in keeping the Western Australian goldfields open. If a line were drawn around the goldfields area in Western Australia and the area of the State was limited to the regions of the cities and agricultural activities, it would be a vastly different Western Australia from its present form.

As I understand the argument of the United States, il is this: ‘Why should we increase the price of gold when we are the only buyer of it?’ A maxim of buying and selling according to the old capitalist theory is that sole buyers of a commodity have the upper hand. That is why for so long the price of gold has been fixed. I have always felt that the Australian Government is reluctant to approach the problem of gold prices. Its approach is coloured by the fact that the area of Australia in which gold mining is pursued is very small in relation to the whole of Australia. The Americans say: ‘Firstly, why should we increase the price of gold when we are the only buyer. Secondly, if we were to assist somebody by increasing the price, we would assist a nation which is doing rather well anyhow. We would be assisting South Africa. Thirdly, we would bc assisting Russia and we are not very anxious to assist that country. If we are to distribute largesse in assisting somebody, why should we not assist countries like India which have other products to sell?’ As Senator Cant has pointed out, in the field of international finance gold plays an enigmatic part.

An interesting point in relation to gold is that it can hardly be called a commodity. When we think of a commodity we think of something that is grown or produced and consumed. But gold is never consumed. The value of this metal is that it never deteriorates. Whereas every other commodity either deteriorates or is consumed, gold is not con sumed and does not deteriorate. This point was illustrated some years ago in a story about the Louisiana Purchase. At that time a lot of gold passed to France. About 100 years later, when it had to go back to the United States in payment for something else, it went back in the wrappings in which it had come from the United States. So it is a product that does not deteriorate or disintegrate. It is withdrawn from the ground, refined and sent to Fort Knox. It either lies there or moves around the world in a process that requires a tremendous amount of study to understand.

Although we welcome any assistance to the gold mining industry, it can never be said that the Government has been overgenerous to the industry. As Senator Cant has pointed out, gold is playing a very important part in world monetary agreements or disagreements today. I am sure that if this commodity was being mined in Victoria or New South Wales the Commonwealth Government would take a vastly greater interest in it. 1 always feel that the Government supports the gold mining industry in Western Australia very reluctantly. This legislation is almost a hardy annual. This subsidy is provided every year or two by the Federal Parliament. There is never any reason for the Opposition to oppose it. After all, il is keeping the gold mining industry on its feet.

Until the discovery of nickel in the Kalgoorlie area recently, there was despair and a declining interest in the gold mining industry. Only because other metals have been found is there tremendous interest in gold mining again, particularly in the great Golden Mile of Kalgoorlie, lt is a great Golden Mile because it has been mined since the early 1890s and is still producing gold, but there is more gold there today than has been taken out during the period of more than 70 years, lt is really a world phenomenon. We support this Bill. I support everything that Senator Cant, with his knowledge of this industry, has put before the Senate. I always say that the subject of gold in the Australian context is an interesting one. We welcome the Bill. I conclude by saying that the Commonwealth has never been over-generous in its approach to this vital commodity.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– in reply - I thank Senator Cant and Senator Willesee for their indication of support of this Bill. lt is true that it is not a very big matter in relation to the whole of the gold mining industry. That point has been canvassed by the two honourable senators 1 have mentioned. It is true that the subsidy rates have been in operation since as far back as 1954. In that time about $28m has been provided in the form of subsidy. Nevertheless the Opposition senators make the point that gold is of tremendous significance to Western Australia. I note the reference to specialised areas in which it is necessary to preserve the gold mining industry, apart altogether from other considerations. Exemptions from taxation have been granted and subsidies have been granted. I do not think I want to embark on a debate on the broad issues. I do not know that I am competent to do that at this moment. I thank the Opposition for its support of this legislation.

Question resolved in the affirmative.

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

page 2364

COMMONWEALTH BANKS BILL 1968

Second Reading

Debate resumed from 14th November (vide page 1991), on motion by Senator Anderson:

That the Bill be now read a second time.

Senator WILKINSON:
Western Australia

– This Bill has received quite a measure of approval from the Commonwealth Bank Officers Association, which feels that it does a lot for members of the Association. I believe that we should take note of the good features of the Bill. One provision enables married women to continue in the service. The provision is exactly the same as that which already obtains under the Public Service Act. This provision brings this legislation into line with the Public Service legislation and is quite an advance. The second very important feature of this Bill is that it defines in more exact terms the types of things that an officer may not do without risking his employment or suffering loss of pay. Instead of there being a certain measure of doubt, as there was previously, an officer will now know just what are the types of things that he should not do. The next important feature of the Bill is that it endeavours to grant to an officer, who feels that he has been wrongfully charged or that he has received some penalty which is not correct, the opportunity to appeal. This opportunity is defined much more precisely in this Bill than it was in the original Act. Those are the good features of the Bill.

I propose to draw attention to a number of matters which we will be seeking to amend at the Committee stage. But before I do that let me say that one provision which we will not be seeking to amend but about which we are not very happy is that which makes it possible for stamp duty to be charged on cheques drawn on society accounts. The Commonwealth Bank has always been considered to be the people’s bank and, as such, to be trying to operate for the benefit of the people. Right from the introduction of society accounts, which made it possible for societies to operate cheque accounts, societies have been able to receive interest on their accounts and stamp duty has not been charged. This provision in the Bill is a departure from a principle which was of very valuable assistance. We are not proposing to seek to amend this provision, but we are registering our opposition to it.

I now deal with the proposed amendments which will be moved in the Committee stage. In the main they refer to appeals and to the conduct of a person who has been charged by the Corporation with misconduct. I refer particularly to clause 12 which seeks to repeal section 107 of the principal Act and to insert a new section 107. Proposed sub-section (10.) provides:

For the purposes of this section an officer shall be taken to have been guilty of misconduct if, and only if -

he has been guilty of any disgraceful or improper conduct, whether as an officer or otherwise;

We think that this paragraph is rather loosely worded in that it could cover a tremendous number of acts. It could be used against an officer in his normal life away from his work. The conduct might have no effect at all on his ability, his efficiency, his standing or his duties as an officer of the bank. For this reason we propose to move an amendment similar to that moved in the other place. We think that the misconduct ought to be defined more clearly, and that is what the amendment seeks to do. Clause 13 deals with the appeals which can be made to the Disciplinary Appeal Board. In 1960 advice was given by a legal expert. This was referred to in the other place and the actual opinion obtained was included in Hansard. I do not propose to read it. If any honourable senator wishes to seek that information he may refer to the Hansard report of the proceedings in the other place. The opinion showed that because of the way in which the Act is worded, the Disciplinary Appeal Board could deal with matters under sections 106 and 107 only of the original Act. This means that if it is wished to deny an officer the opportunity to appeal he is charged with an offence that does not come within the ambit of sections 106 and 107. The legal opinion was to the effect that the only way in which an officer could be afforded an opportunity to appeal was to bring the matter before the Commonwealth Conciliation and Arbitration Commission. I shall later move to delete also section 109 of the principal Act which defines the Disciplinary Appeal Board.

Senator Anderson:

– That will be a consequential amendment.

Senator WILKINSON:

– That is right, lt will be only consequential. The Opposition will not oppose the second reading of the Bill. The amendments will be moved in the Committee stage. Whether or not our amendments are accepted we shall agree to the third reading of the Bill.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– in reply - I thank the honourable senator for his approach to the Bill. Only one question emerges at the second reading stage and that is the reference to stamp duty. The Government considers that the State governments should determine the organisations that should pay stamp duty on their cheques. In general, charitable, religious, patriotic or educational bodies and friendly societies are exempt from paying stamp duty on cheques drawn on any bank. Those bodies will not be affected. The question arises in respect of the fringe organisations.

Senator Georges:

– Could the member name a fringe organisation?

Senator ANDERSON:

– A sporting body.

Senator Georges:

– What about a credit union?

Senator ANDERSON:

– Senator Georges and I have had words on this subject before.

Senator Georges:

– All kinds of impositions are being placed on these bodies.

Senator ANDERSON:

– I am not competent to give a judgment at this time. 1 think the criterion is whether an organisation is of a charitable, religious, patriotic or educational nature. 1 do not know whether one would call a credit union an educational organisation, it certainly is beneficial.

Senator Little:

– Would Scientologists be included?

Senator ANDERSON:

– Now the honourable senator is making it difficult. I think we should move to the Committee stage forthwith.

Question resolved in the affirmative.

Bill read a second time.

In Committee

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

Clause 12.

Section 107 of the Principal Act is repealed and the following section inserted in its stead: - “ 107. (1.) . . . (10.) For the purposes of this section, an officer shall be taken to have been guilty of misconduct if, and only if -

  1. he has wilfully disobeyed or disregarded an order applicable to him as an officer and given by a person having authority to give the order;
  2. he has been negligent or careless in the discharge of his duties;
  3. he has been inefficient or incompetent by reason of causes within his own control;
  4. he has used intoxicating liquor or drugs to excess;
  5. he has been guilty of any disgraceful or improper conduct, whether as an officer or otherwise;
  6. he has committed a breach of the terms and conditions upon which he holds office;
  7. having made and subscribed an oath or affirmation under sub-section (1.) of section ninety of this Act, he has done or said anything in violation of that oath or affirmation; or
  8. he has, whether before or after becoming an officer, wilfully supplied to the Corporation, to an officer of the Corporation or to any other person acting on behalf of the Corporation incorrect or misleading information in connexion with his appointment to the Service.’.
Senator WILKINSON:
Western Australia

– I move:

I do not want to speak at length on this amendment. It explains itself, following on what I said during my speech on the second reading. It is obvious that the amended definition gives a much clearer meaning of disgraceful or improper conduct.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I shall deal with the amendment with some brevity. Clause 12 of the Bill follows fairly closely the provisions of the Public Service Act. It is envisaged that misconduct and improper conduct could go beyond dishonesty at the bank. In his private capacity an officer could do something which could have a direct bearing on his career as a bank officer holding a position of trust. I think that the clause deals with a view wider than that which the Opposition would accept. The right of appeal is provided. In all the circumstances, I believe that the Government’s proposal is a proper one. I would suggest that the simplest way would be to put the matter to the vote.

Amendment negatived.

Clause agreed to.

Clause 13. (1.) Section 108 of the Principal Act is amended by omitting sub-sections (1.) and (2.) and inserting in their stead the following sub-sections: (1.) Where, under section one hundred and six or sub-section (1.) of section one hundred and seven of this Act -

  1. an officer is retired, dismissed or transferred or has his salary reduced; or
  2. the Corporation determines that an officer be not granted, or be not granted until the expiration of a specified period, the whole or a part of an increase in salary, the officer may appeal to the Disciplinary Appeal Board. (2.) The regulations may prescribe the manner in which, and the lime within which, appeals may be made under this section and the manner in which the hearing of appeals so made shall be conducted and may include provision for or in relation to the summoning of witnesses, the production of documents, the taking of evidence on oath or affirmation and the administering of oaths or affirmations.’.
Senator WILKINSON:
Western Australia

– I move:

I do not think there is any need to explain what I mean by this. I have already given my reasons for seeking removal of the words ‘Disciplinary Appeal Board’ and the insertion of the words ‘Commonwealth Conciliation and Arbitration Commission’. I have no doubt the Minister now wants to say he is prepared to accept my proposal.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I am sorry that I cannot accept the honourable senator’s proposal, which seeks to omit one subclause and substitute another. It is fair to say, however, that the whole question of appeals from administrative decisions is being examined by an expert committee appointed by the Attorney-General (Mr Bowen). The Attorney-General recently appointed a committee comprising Mr Justice Kerr as Chairman, the SolicitorGeneral, and Professor Whitmore, to examine the whole question of appeals from administrative decisions under Commonwealth legislation. The committee’s principal term of reference is to consider the jurisdiction to be given to the proposed Commonwealth Superior Court to review administrative decisions. The Government considers that it would be inappropriate to amend an individual Act to change the tribunal appointed to hear appeals under that Act until the committee has completed its examination of the overall subject and furnished its report to the Government. When the report has been received and studied by the Government, consideration will then be given to what changes, if any, should be made to the appeal procedures in Commonwealth legislation generally. So that whilst. I am not prepared to accept the proposed amendment, I do indicate that this question is currently under review.

Amendment negatived.

Clause agreed to.

Clause 14 agreed to.

Title agreed to.

Bill reported without amendment: report adopted.

Third Reading

Bill (on motion by Senator Anderson) read a third time.

page 2367

RAW COTTON BOUNTY BILL 1968

Second Reading

Debate resumed from 14 November (vide page 1992), on motion by Senator Scott:

That the Bill be now read a second time.

Senator O’BYRNE:
Tasmania

– The Bill before the Senate seeks to amend the Raw Cotton Bounty Act which provided for the payment of a bounty on the production of raw cotton. The present provisions expire in February of next year. The purpose of the Bill is to alter the amount of bounty which at present is 16.125c per lb of cotton of the grade known as middling white and having a staple length of one inch. The original Act also provided for different rates for differing grades and staples. A limit of $4m was made available for expenditure by way of bounty under the overall scheme. The Act further provided that the bounty applied only to cotton sold in Australia. The Bill before us seeks to delete that provision.

The Government’s policy with relation to cotton has proved to be very successful. The development of this industry has been such that it can truly be called one of the dramatic events in the history of primary industry in Australia. Cotton production has a long history. Its development is a part of the history of the United States. Originally, cotton was available mainly from certain areas of the United States where cheap labour was available. Indeed, I suppose many of the present problems experienced in the United States can be traced back to the terms and conditions of employment in the cotton fields there in the early days when huge numbers of people were recruited from the under-privileged parts of the world to assist in the cotton industry. All this forms part of the drama of cotton growing.

Cotton has qualities that enable it to be manufactured into durable, light clothing. Its characteristics are such that people like wearing clothing made from cotton fabrics. It continues to be popular as a clothing fabric and for this reason the demand for cotton products continues. To give some idea of the development that has taken place in cotton production in Australia, I tell the. Senate that in 1964 bounty was paid on 11,700 bales of cotton. In the following year the bounty was paid on 46,000 bales. In 1966 it was paid on 93,000 bales. It was in this year that the Government realised that by paying a bounty of 16.125c per lb the limit of $4m a year would be exceeded. The legislation we are now considering ensures that the bounty is distributed to all growers in direct relation to the quantity and quality of cotton produced. Recent figures indicate that 140,000 bales of cotton will be produced in Australia this year. Of course, that figure is only speculative, but production is closely approaching meeting the demands of Australian industry.

The growth in cotton production has been rapid and dramatic in New South Wales in recent years. In 1962-63, 2,500 acres were under cotton in that State and there was a production of 3 million lb of unginned cotton, an average of 400 Jb to the acre. In the following year 8,500 acres were under cotton, an increase of over 300%, and production was 8 million lb. In 1964-65 the area under cotton more than doubled to 19,000 acres and production rose to 46 million lb. out of a total Australian production of 63 million lb. In the following year, 1965-66, the area under cotton in New South Wales increased from 19,000 to 33,000 acres, and the total production rose to 103 million lb. Those figures indicate that production improved from an average of 418 lb an acre in 1962-63 to 2,436 lb an acre in 1965-66, which is the last year that I have figures for. This expansion could hardly have been predicted under normal conditions. I think that we should pay a tribute to those who took the initiative and went out into the Namoi and Narrabri districts of New South Wales and developed the country to a stage where it is producing 75% of Australia’s cotton requirements. But this saga of progress is not complete as the growers in these districts appear to have the know-how and technique to increase further their yield per acre.

The Parliament and the nation are now confronted with the task of deciding what to do with this new and very valuable industry that is changing the whole pattern of a section of our textile trade. The fact that Australian cotton production is nearly able to meet the demands of our industry means that we will have to examine our imports of cotton products. Over the years we have had no alternative but to import large quantities of fabricated cotton goods but we are now at the stage where very serious consideration will have to be given to offering our cotton growers an incentive to improve their technique and expand their acreage to give us self-sufficiency. I have not given sufficient thought in depth to the problems that could confront us as a result of the profit from cotton growing in the Namoi and Narrabri districts leaving the country. I sincerely hope that a review is made of the amount of profit from this young industry, that may leave Australia in the future.

During the development period the progressive American farmers in the Namoi and Narrabri districts, showing good land husbandry, have been salting the proceeds of their increasing production back into the ground. There comes a time when this action pays off. Those who have invested in this industry, which has increased production so rapidly, will receive very high returns for their investment. I hope that the Government will watch this quite closely. I believe that only a reasonable proportion of the profits from investment in this enterprise should flow back to the United States of America. Although many Americans engaged in cotton growing will settle permanently in Australia and will retain their capital here, there will be a proportion of the American investment in this industry which will expect to take from Australia the highest yield possible. The very rapid increase in production of cotton in Australia has surprised most people and could lead to this very important factor being overlooked.

Some problems will eventually be posed for the Tariff Board in ensuing that more and more locally produced cotton is used in the local manufacture of cotton fabric. There is an expanding market for cotton fabrics in Australia as a result of our population growth. The fact that many people migrating to this country from Europe are coming to a warmer climate will also stimulate the demand for cotton fabrics. I believe that all factors affecting the cotton industry should be very closely watched in order to ensure that a sudden brake is not put on what is proving to be a viable industry. I believe that we have a big responsibility to ensure that there is an incentive to the growers to make Australia self sufficient. The Government proposes to phase out its assistance to the industry over the next 3 years.

Senator Scott:

– That is not in this Bill.

Senator O’BYRNE:

– This is an observation and I do not want to enlarge on it beyond saying that the new arrangement whereby the total payout to all of the producers throughout Australia will come from the $4m bounty limit will mean that every additional 1 lb of cotton will call for a bounty in a reducing ratio. The greater the production of cotton the less the bounty per lb will become. It is quite possible that if provision can be made for the absorption of increasing amounts of cotton within the country, and for that matter if suitable markets can be found outside, a bounty of S4m will be an incentive for people to remain in production although it will represent only a small amount per lb. During the course of the debate in another place care was taken not to spill over into other matters relating to the cotton industry, but 1 would just like to sound the warning that we must not kill industries which are able to increase their production to the extent to which the New South Wales cotton industry has been able to increase production. I mentioned at the outset that great credit is due to the people who have developed the irrigation method of cotton growing, and improvements in the form of harvesting and all the other things associated with the cotton industry. Having discovered and brought all of those factors together in a very successful industry, sentiment, pressures and other factors should not be brought to bear so as to denigrate or reduce the effectiveness of this great contribution that the people in New South Wales are making to the production of cotton in Australia.

The Bill itself is quite simple. It makes certain that there will be no sudden cutting 0K of the $4m which is available. The Bdi has given the industry a warning that it can expect, as its production per acre grows and as the total Australian production grows, that the rate of bounty per lb will be reduced. Yet there will be a phasing out period during which adjustments can be made. Finally, in stating that the Opposition gives support to this measure let me say that we feel that this is an industry which is worthy of Government support. It is fast reaching the stage where it can become selfsupporting. We hope that not only will the people who are engaged in the industry continue to prosper but also the Government will define a policy which will allow the Australian industry eventually to take its place as one of the substantial producers of cotton in this geographical area of South East Asia in which we live. We support the Bill.

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– I want to say just a few words in support of this measure. As has already been pointed out, it provides for an extension of the bounty to cotton which may have to be exported. The existing legislation provides for a bounty only on that cotton which is used by the Australian spinners. The expansion of the industry has been so dramatic and so rapid as to produce more cotton than the Australian spinners require and can use at present. This is something which nobody could have foreseen only 2 or 3 years ago. As has already been pointed out, this Bill has nothing to do with the phasing out of the bounty. 1 live in an area which has produced cotton in various forms on and off for about 45 years. In the 1920s it was dry land cotton which was hand picked, and for quite a number of years the Queensland Government gave a guaranteed price of, I think, about 5d per lb for seed cotton. This enabled the industry to carry on spasmodically in the Dawson and Callide valleys until the war. But after the war manual harvesting became impracticable and it. is only more recently, with the development of the mechanical harvester, irrigation and quick transport to the ginneries for treatment that cotton growing has become a practicable proposition.

Mechanically picked cotton has to be treated within about 24 hours. I am informed by the cotton growers that the irrigation of cotton is not just a matter of putting water on the plants as one does in many other cases. It is a very risky technique. The water has to be put on at exactly the right time and in the right amounts. The Namoi area has developed and shown what can be done in a region which has the climate, sufficient water and sufficient soil to produce cotton in a big way. The Ord River area is being designed to produce colton, and the latest scheme which has been opened at Emerald will have cotton as one of its economic bases. All of these things point to the fact that the industry will expand and that we have to find more markets. 1 was interested today to hear the report of Japanese buyers being here who would possibly take some of our surplus cotton. If we can make a dmi with them it will be a very good thing for the industry. 1 believe, too, that although our own spinners can take only a certain amount of cotton - we still import a very large percentage of our cotton textile goods - we could expand our industry and provide more work for our people. If we could show that cotton can be produced in bigger quantities and economically compared with world prices, some scheme could be evolved whereby our textile industry could be expanded to produce more cotton piece goods and so enable the spinners to produce more colton in that form. We have shown what can be done with the tobacco industry. I am not suggesting that this should be done with cotton, but that is one way in which the industry could be encouraged. Efficiency cannot be penalised. Even though the growers are getting a bounty, they have shown that they are mighty efficient, and we should not have to reach the stage in Australia, where conditions are so suitable for this industry, of making any move to limit production. I support the Bill and I hope that some means can be evolved over the next few years when this bounty is being phased out - it has been announced that this will be Government policy - to expand our local industry, to find overseas markets and to put the cotton industry on its feet, lt has already shown that it is adaptable to many different areas and will attract people into places where there are nol very many people at present. We should do all that we can to encourage it in every way.

Question resolved in the affirmative.

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

page 2370

LOAN (HOUSING) BILL (No. 2) 1968

Second Reading

Debate resumed from 14 November (vide page 1992), on motion by Senator Dame Annabelle Rankin:

That the Bill be now read it second time.

Senator POKE:
Tasmania

– The purpose of this Bill is to raise two loans overseas. The Government says that the purpose of the loans is to make advances to the States for housing. The Minister for Housing (Senator Dame Annabelle Rankin) said in her second reading speech:

The purpose of this Bill is to authorise the application of the proceeds of two loans recently arranged overseas for the purpose of making advances to the States for housing.

By these loans the Government proposes to borrow $126m, some from Germany and the balance from the United States of America. At this point I indicate on behalf of the Opposition that we do not agree with the Bill and that we will vote against it. The schedule to the Bill shows that 200 million Deutsche marks are to be borrowed in Germany and $US50m is to be borrowed in the United States of America. I think it would be safe to say that although we have been told that the money is being raised for housing, not one cent will be used for the construction of a home in Australia. I consider that that is fair comment. The Opposition feels that, in the main, this money is being raised to boost our overseas trade balances and it is for this reason that we cannot support the Bill. One wonders why, if it was impossible to raise this amount in Australia, the Government did not endeavour to make some arrangements to raise it in some other Commonwealth country. We believe that that would have been much better housekeeping than trying to raise the loan in Germany or in America. 1 have said already that we of the Opposition consider that none of this money will be used to finance the building of homes within the Commonwealth of Australia. Let us face the situation that we can produce in Australia the bricks, baths, sinks, iron, nails and everything else that is required to build a house from the foundation to the roof. If we can produce the materials in Australia, why is it that we cannot find the money within the Commonwealth countries? This is not a large sum. I suggest that the Government should tell us what rate of interest will be paid on these loans. As near as I have been able to ascertain the Australian Government will have to pay slightly in excess of 6£% interest. If we have to pay in the vicinity of 6£% interest on money borrowed for the purpose of making advances to the States for housing, by the time an additional 1% is added for administrative charges the rate payable when the money is made available for housing will be in the region of 7i%. Very few people in the Commonwealth will be able to afford to pay 7i% interest on money borrowed to build a home. But let us consider also the many people who will need a second mortgage. By the time these people have paid interest at the rale of 7£% on their first mortgage and interest of 10% or 12% on their second mortgage they will find home building to be a very costly business.

I believe that the Government has a responsibility to tell the Senate what rate of interest the States will be charged on the amount that goes to them. According to the Bill, this is the main purpose of raising the loans. I have calculated what it will cost a borrower by the time this money is farmed out from the Government to the various States, but I suggest that the Government should inform the Senate what the rate will be and what it will cost the borrower if the money goes through the channels that I would expect. I suggest that in no circumstances can the Government farm out this money at a rate which is favourable to a borrower and a home builder. I ask the Minister for Housing to clarify these points when she replies to the debate on the second reading. I sincerely hope that she does so. We of the Opposition can see no prospect of borrowers being able to pay the rate of interest that will be required. For the reasons which I have stated already and for other reasons which are inherent in the Bill the Opposition will oppose the measure when it comes to a vote. We do not intend to move an amendment to the Bill during the second reading stage, nor do we intend to move any amendments in the Committee stage. When we reach the stage of voting on the motion that the Bill be read a second time we propose to call for a division. After the division the passage of the Bill through the House probably will be facilitated. I think I have indicated our position, and I leave it at that.

Senator Dame ANNABELLE RANKIN:
Minister for Housing · Queensland · LP

[5.41] - in reply - I thank Senator Poke for his comments and should like to reply to one or two points that he raised. He referred to the rate of interest charged to the States by the Commonwealth on funds advanced for housing. I am sure he knows quite well that under the terms of the Commonwealth and State Housing Agreement the rate of interest charged by the Commonwealth to the States in respect of overseas loans raised for housing is 1 % below the long term bond rate, which at present is 4.4%. The rate of interest will remain unchanged.

The honourable senator inquired why we should borrow money overseas and, as I understood him, rather implied that although this money was being borrowed for housing it was not being used for housing. Of course that is an incorrect supposition. Unless the foreign currency proceeds of overseas loans are used for direct purchases overseas, as with our defence and aircraft requirements, they are added, in the first place, to Australia’s international reserves. This is done by selling foreign currency proceeds to the Reserve Bank which credits the Commonwealth with the equivalent in Australian currency. Until 1963-64 most loans raised overseas for purposes other than defence or aircraft purchases were allocated to the Commonwealth and State governments roughly in proportion to their share of the works and housing borrowing programmes approved by the Australian Loan Council. The States’ share was applied directly to their civil works expenditure and the Commonwealth’s share was used to finance advances to the States for housing purposes. As I mentioned earlier, these housing advances are made at a rate of interest 1% below the Australian bond rate. The Commonwealth has not used any of its share for the works and housing programme to finance its own civil works and thus has ensured that all borrowings are made available directly or indirectly to the States.

In 1966 the Commonwealth agreed with the States that, in view of the difficulties which were being experienced in raising loans in overseas markets and the heavy overseas Commonwealth and State Government maturities in the coming years, the Commonwealth should accept the responsibility of re-financing in Australia at the long term bond rate all State government debts maturing overseas in the next 3 years. The Commonwealth also said that it would accept the proceeds of any new overseas borrowings as well as of re-financing Joans for its own account. Since that time ali loans raised overseas have been in the name of the Commonwealth and except where they have been raised, as I mentioned earlier, for the purchase of civil aircraft, for defence requirements or for conversion purposes, the loan proceeds necessarily have been applied to the financing of housing advances to the States at concessional rates of interest. The authority for the appropriation of loan funds for the purpose of making these advances is provided by the various Loan (Housing) Acts. We had one before us in the Senate recently.

In general, when the Commonwealth borrows overseas it supplements the capital and the amount of its resources available in Australia. Consequently Australia is able to direct more resources towards investment, and it is our rather high level of investment that has determined the increasing high standard of living of our population, something which I believe all of us in Australia appreciate and recognise. Australia’s current high rate of housing construction, in relation to which I have given figures in this House recently, is an important avenue of investment. This would not have been possible if it were not for the large amounts of official capital, including overseas capital - surely this replies to Senator Poke’s commentswhich have become available in recent years. Because of this, the picture of housing in Australia is a good one. Because of this we see increases in the number of completions, commencements and approvals - in fact in all avenues of housing. We in Australia can look today at a record in housing of which, while not being complacent, we can feel justly proud. I believe that we are doing a great deal for the security of the families in this growing, developing nation. 1 regret that the Opposition feels it must oppose this Bill because I believe that this Bill is important in the field of housing.

Question put:

That the Bill be now read a second time.

The Senate divided. (The President - Senator Sir Alister McMullin)

AYES: 26

NOES: 22

Majority . . . . 4

AYES

NOES

Question resolved in the affirmative.

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

page 2372

LOANS (AUSTRALIAN NATIONAL AIRLINES COMMISSION) BILL J 968

Second Reading

Debate resumed from 14 November (vide page 1 993), on motion by Senator Anderson: Thai the Bill be now read a second time.

Senator DEVITT:
Tasmania

- Mr President, I understand that with the concurrence of the Minister handling this Bill it may be in order and would suit the convenience of the Senate if we dealt with it in conjunction with the Loan (Qantas Airways Ltd) Bill and the Airline Equipment (Loan Guarantee) Bill since all three Bills deal with the broad question of the replacement and purchase of aircraft.

The PRESIDENT:

– ls the Senate agreeable to that course being followed? There being no objection, that course will be adopted.

Senator DEVITT:

– I will deal firstly with the measure relating to the purchase of equipment for Qantas Airways Ltd. The Government proposes to borrow $US53m or SA47.3m, of which 80% will be borrowed through various agencies in the United States. This money will bs used to purchase four new Boeing 747 aircraft which are commonly known as jumbo jets. The Labor Party offers no objection to this proposition. It realises quite well the necessity to enable our international airline to compete for business on world air routes and to be able to operate with the most modern equipment available. Fairly recently I had the opportunity to sample the standard of service provided by Qantas. [ was quite happy with the general level and standard of service. It was my view that the service compared quite favourably with anything else offering throughout the world, according to my experience.

Senator Cormack:

– Comparable with what?

Senator DEVITT:

– The service was comparable with that provided by other airlines in the world which operate on international routes. The Bill is necessary to back the borrowing of this money overseas. The Labor Party bases its concurrence in the proposition on the fact that these aircraft will be necessary in the next couple of years. The repayment of this money will be the responsibility of Qantas itself. The only reservation 1 have about the proposition relates to the fact that I believe we are moving into a completely new era in international commercial airline operations; we are coming into the era when aircraft will be flying at twice the speed of sound and even beyond. In the light of experience in the purchase and operation of modern airliners, one wonders whether developments will not catch up with us and rapidly pass us by. One wonders whether we will be operating aircraft at subsonic speeds when in fact the practice throughout the world will be to use aircraft capable of supersonic speeds.

However, so far as the loan itself is concerned, Qantas will be earning revenue by its operations in various countries and there can be no real objection to borrowing this money overseas, particularly when the sum is of such magnitude. The finance sought, as I said, represents 80% of the total estimated cost of SUS137.5m. These funds will be used to buy four aircraft together with the equipment necessary, such as spares, to operate and service them. With the reservation that history is moving very rapidly in relation to the operation of air services throughout the world, the Opposition supports the proposition that the Australian Government borrow these funds. The Minister for Supply (Senator Anderson) made clear in his second reading speech that the loan will be repaid over a period of 7 years. lt is not necessary for me to canvass these matters.

Referring now to the Loans (Australian National Airlines Commission) Bill, this relates to the purchase of an additional Boeing 727 by the Australian National Airlines Commission for use by Trans-Australia Airlines. The amount involved is 54.2m and the Opposition believes, Mr President, that it should not be necessary for the Australian Government to go overseas to borrow this money. The Bill proposes that we borrow 9.9m Swiss francs, which is the equivalent of §A2m, from the Union Bank of Switzerland, and an amount equivalent to $A2.2m in the United States. This money is to purchase a fifth Boeing 727 jet aircraft. The Labor Party is very concerned that it is necessary for small amounts of money such as this to be borrowed overseas. It ought to be possible for us to finance such purchases from revenue and from our reserves. Australia should not have to go round the world to borrow from two countries sufficient money to buy one aircraft. This seems to have been the practice followed since Australia has been in need of aircraft. Notwithstanding that it has been the practice followed in the past, we of the Labor Party believe it is wrong that we still have to go overseas to borrow money at the interest rate quoted, plus the service charge, which from memory, puts the interest rate on this loan at something over 7%. It is wrong that we should have to do this when, as the Treasurer (Mr McMahon) has pointed out, we have reserves of at least $l,000m.

Equipment of the airlines raises the general question of the adequacy of the aircraft available to TAA. My attention was drawn to a report circulated subsequent to the annual report of the Australian National Airlines Commission pointing out a number of factors in greater detail than was available to us in the Commission’s report. If honourable senators were to study the report I have referred to I believe they would find that it points to some very grave deficiencies in the operation of Australia’s domestic airlines system. I have spoken about this on previous occasions and have referred to the inadequacy of aircraft available to TAA.

Sitting suspended from 6 to 8 p.m. (General Business taking precedence of Government Business.) [Quorum formed.]

page 2373

ORDER OF BUSINESS

Motion (by Senator Anderson) agreed to:

That consideration of General Business bc postponed until after consideration of Government business, Order of the Day No. 24.

page 2374

NEW AND PERMANENT PARLIAMENT HOUSE SITE

Debate resumed from 22 October (vide page 1477), on motion by Senator Anderson:

That the Senate, having considered Message No. 78 of the House of Representatives, concurs in the Proposal by the House that the matter of alternative sites for the New and Permanent Parliament House, on Capital Hill or the Camp Hill area, be referred to the Joint Select Committee on the New and Permanent Parliament House for report and that the Committte be requested to submit its report within three months.

That the foregoing resolution be forwarded to the House of Representatives by Message.

Senator MURPHY:
New South WalesLeader of the Opposition

– This matter of a new and permanent Parliament House site is being dealt with by a free vote. It concerns the motion which has been moved by Senator Anderson. Honourable senators will recall the lengthy discussion we had on this matter, punctuated by a considerable number of points of order. Finally the motion came to be considered. 1 then indicated that I would move an amendment which might make clear, if agreed to, that the Senate was not departing from what it had previously decided but had agreed to the use of the Joint Committee on the New and Permanent Parliament House as a means of informing primarily the House of Representatives, but no doubt the Senate also, of the views of that Committee on the respective merits of the Capital Hill and Camp Hill sites. The matter arose because the House of Representatives did not make up its mind as between the two sites and desired to use the Committee in order to inform itself. I move the following amendment to Senator Anderson’s motion:

Before the word ‘concurs’, insert - without prejudice to its resolution of 22nd August 1968, “that the Senate is of the opinion that the new and permanent Parliament House should be situated on Capital Hill”.’

If my amendment is accepted, the motion will then read:

That the Senate having considered Message No. 78 of the House of Representatives, without prejudice to its resolution of the 22nd August 1968, that the Senate is of the opinion that the new and permanent Parliament House should be situated on Capita) Hill’, concurs–

Senator Anderson:

– After the word concurs’ the balance of my motion follows. Is that correct?

Senator MURPHY:

– Yes. My proposed amendment ought to allay the fears of any senator that the Senate would in any way by agreeing to my proposal depart from its previous decision. It goes beyond the question of the construction of Standing Orders or of one motion as against the other, because if my proposal is accepted it will mean that we have incorporated in the motion that we are acting without prejudice to what we have previously decided. I would think that we would be then following a course which is not only desirable but almost mandatory on the Senate in order to observe due courtesy towards the House of Representatives. I ask the Senate to accept my amendment. If it is accepted, I ask honourable senators then to support the motion moved by Senator Anderson. I said before - andI do not think it can be said too often, because we do not often get an opportunity to say it - that it is open to every honourable senator - certainly every senator of the Opposition - to vote exactly as he wishes. No Party decision is to be made on this matter. No Party obligation is involved. It is a matter entirely for the individual conscience of each senator.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I will address myself only to the proposed amendment. The situation is that the Senate on 22nd August carried a resolution in favour of the Capital Hill site for the new and permanent parliament house. Whatever may be the consequences of referring to a committee the question of the Camp Hill site, the Senate will always have to face up to the resolution it carried in favour of Capital Hill. For that reason it seems to me that there is no problem about the amendment proposed by Senator Murphy. In the first place T moved that the Senate, having considered Message No. 78 of the House of Representatives, concurs in the proposal by the House that the matter of alternative sites for the new and permanent parliament house, on Capital Hill or Camp Hill, should be referred to the Joint Select Committee on the New and Permanent Parliament House for report and that it be requested to submit its report within 3 months.

It seems to me that because the Senate has carried a resolution overwhelmingly I could accept this amendment. My original motion will remain and, as I understand it, the amendment will simply add: ‘Without prejudice to the resolution of 22nd August’. This still enables the matter to go on to the Joint Select Committee for consideration and establishes the point that we have expressed a view by resolution. Whatever the consequences, if a variation was in contemplation it would have to come back to this place. For that reason, I am prepared to accept this amendment as a preface to the motion I moved.

Question resolved in the affirmative.

Original question, as amended, resolved in the affirmative.

page 2375

ORDER OF BUSINESS

Motion (by Senator Anderson) agreed to:

That consideration of General Business be further postponed until after consideration of Government Business, Orders of the Day Nos 11, 5, 6 and 7.

page 2375

BANKRUPTCY BILL 1968

Second Reading

Debate resumed from 19 November (vide page 2108), on motion by Senator Wright:

That the Bill be now read a second time.

Senator COHEN:
Victoria

– This is a simple Bill. It involves three minor amendments to the Bankruptcy Act 1966, which honourable senators will recall was the result of a very comprehensive review of the bankruptcy law. Since the Act came into force in 1 966 a number of minor machinery questions have arisen for which some kind of amendment seems to be required. This Bill makes the amendments in a manner that is completely acceptable to the Opposition. The first amendment, which is contained in clause 3, relates to the deposit that must be lodged by a creditor when presenting a bankruptcy petition. Section 48 of the Act provides that the deposit may be used for certain specified purposes. There are some things that are thought not to be covered, namely, expenses incurred by an official receiver before the first meeting of creditors. The amendment contained in clause 3, which I shall not canvass in detail, makes sense of this and puts the Act into a more sensible form.

The next amendment is contained in clause 4. It involves a new provision in relation to the consolidation of proceedings in partnership actions. I do not think it is necessary to take the time of the Senate to canvass the precise nature of the amendment which, although of a minor character, is aimed at facilitating procedural questions when both partners are bankrupt.

The final amendments, which are contained in clauses 5 and 6. relate to the public examination of the bankrupt in country areas or districts a little remote from the Registrar in Bankruptcy. The Bill proposes that in certain circumstances a public examination in a country district may be conducted before the local magistrate, subject to the Registrar thinking it a fit case. This amendment is to be welcomed because it will save a lot of expense in cases that do not warrant a great deal of expense.

Expense is one of the great problems in litigation generally, and not least in bankruptcy matters, in which sometimes a debtor’s very small estate has to be used for the satisfaction of a large number of creditors. It is common sense that as much expense as possible should be saved in the administrative proceedings that precede the sequestration of the bankrupt’s estate or in matters before the Bankruptcy Court that may be involved subsequent to sequestration in the administration of the estate. We believe that this is a very sensible provision. It does away with the expense of having the Registrar travel to a country district to conduct a public examination or of having a person involved in bankruptcy proceedings travel to a place where the Registrar in Bankruptcy resides. For these reasons, and without desiring to delay the Senate any further, I indicate that the Opposition supports the Bill.

Question resolved in the affirmative.

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

page 2375

LOANS (AUSTRALIAN NATIONAL AIRLINES COMMISSION) BILL 1968

Second Reading

Debate resumed (vide page 2373), on motion by Senator Anderson:

That the Bill be now read a second time.

Senator DEVITT:
Tasmania

– As the Senate realises, we are discussing the Loan (Qantas Airways Ltd) Bill which provides for the purchase of four Boeing 747 aircraft, or jumbo jets as they are known, by Qantas; the Loans (Australian National Airlines Commission) Bill which provides for the purchase of an additional Boeing 727 jet airliner in the United States of America and the financial arrangements consequent upon that purchase; and the Airline Equipment (Loan Guarantee) Bill which affords to Ansett Transport Industries Ltd, or to Ansett-ANA, a loan guarantee proposition in accordance with the rationalisation scheme which provides that the aircraft purchased by Trans- Australia Airlines will be matched by similar purchase by AnsettANA. Before the suspension of the sitting I was dealing with the problem - it is a pretty obvious problem to most people in Australia of the inadequacy of the aircraft available to Trans-Australia Airlines to enable it to carry out its commitments to the public. The airline is in its 22nd year of operation. It ought to be obvious to any. body concerned with business management and operations of this kind that a business undertaking which has been able to sustain itself, in the light of the competition that is offering within the framework of the rationalisation scheme, for a period in excess of 21 years ought to be given an opportunity to do its best; not for itself but for the country and its people. 1 put to the Senate in as clear terms as I possibly can that under the provisions of the rationalisation scheme as we know it at present, this airline is not able to do its best, is not able to purchase the airline equipment that it wants to purchase to service the requirements of the country and, in fact, is tied to the lowest common denominator. On previous occasions I have referred to this matter. The development of the country’s airline system is not based upon the performance of the better operator. In fact it is tied to the performance of the operator which does not come up to the standard of performance as TransAustralia Airlines.

Senator Cormack:

– The honourable senator says that it does not come up to the same standard of performance. He cannot make a statement like that without supporting it.

Senator DEVITT:

– I will support it in clear and unmistakable terms. I am putting the proposition that Trans-Australia Airlines is able to attract between 4% and 5% more patronage than its competitor.

Senator Cormack:

– On the trunk routes.

Senator DEVITT:

– Yes, on the trunk routes. I am talking principally about the trunk routes because these are the routes upon which this airline requires additional aircraft. I refer to page 3 of TAA’s special annual report which followed the 23rd annual report tabled recently in the Senate. The special report, as I shall call it, referred to certain things which were troubling TAA. Before proceeding with those things I want to refer to the question of fleet reequipment. This is a matter about which we are concerned at present. The special report states:

Considerable initial progress has been made with TAA’s Operation Streamline which involved reducing aircraft types from 16 to 4, and the number of different power plants from 15 to 3, by 1972. These were the Boeing 727 and Douglas DC9, both using Pratt and Whitney JT8D engines, the Fokker Friendship with Rolls-Royce Dart propeller turbines and the De Havilland Canada Twin Otter with Canadian Pratt and Whitney PT6 propeller-turbines.

During the course of question time in the Senate today reference was made to the fact that the airlines at present are considering the introduction to their fleets of the F28 Fokker turbo-prop aircraft, which is a version subsequent to the F27. The F28 is a jet airliner. The airlines are considering the purchase and introduction to their fleets of this type of aircraft to replace the Vicount which is now being phased out. I am concerned about this trend. I am concerned about the fact that .while no mention is made of it in the report of the Australian National Airlines Commission, consideration is being given to the use, not of four but of five aircraft types.

I agree that this is a good thing because it will provide some of the more remote airports with a service which is superior to that being provided by the Viscount now. The alternative, as I have mentioned on a number of occasions here,- is to revert to the use of the F27 Fokker Friendship aircraft which is smaller, slower and, 1 suggest, less efficient in its general .operation than is the Viscount. The prospect for the people in these areas is a service inferior to that being provided at present. To me this is unacceptable and it is unacceptable to the people for whom the service is being provided. Unless the Department of Civil Aviation and the Government can do something to lengthen and strengthen the runways at the more remote airports to enable

DC9 aircraft to use the runways, the alternative is to look seriously at the possibility of acquiring a jet airliner which will give equal or better service than that being provided at present. I suggest that less than that is unacceptable to the people of Australia. No mention is made of that in terms of loans, notwithstanding the fact that the airlines are considering this proposition. lt is rather disturbing to note the comments made by TAA in relation to the Electra aircraft. I think the Electra is a very fine aircraft. I have flown in Electras for quite a number of years. In terms of modern concepts of air travel the Electra is now an outmoded aircraft. Despite the fact that for some reason or other the Australian National Airlines Commission wishes to replace this aircraft with a more modern and more economic aircraft in operation and this is an assessment made by an airline, let us bear in mind, that is now in its 22nd consecutive year of operation - it is not able to do so. This is attributable to the concept of rationalisation. The special report states:

However, the potential gains to the travelling public is efficiency and cost reduction thai will stem from Operation Streamline. . . .

This is the concept of the four distinct types of aircraft: . . will remain seriously limited until the complex and technically obsolescent Lockheed Electras can be retired from the fleet. They have already been iri TAA’s service for 10 years.

Senator Cormack:

– Their capital cost has been wiped off.

Senator DEVITT:

– I am not concerned about their capital cost at this moment in this context.

Senator Sim:

– What are you concerned about?

Senator DEVITT:

– If you will allow me to make my speech I am quite sure the Senate will allow you an opportunity later. The report continues:

The Commission’s original programme has now been revised so as to set back to 1970 the Electra retirement, and replacement of their capacity by DC9 jets.

Retention of the Commission’s three Lockheed Electras in operation beyond 1970 necessitates expenditure to the order of $200,000 in reworking these aircraft, in order to meet the already published directive of the Director-General of Civil Aviation. In addition very heavy costs for complete Overhauls will also be incurred on the Electras if their operation is extended beyond 1970 and when coupled with the fact that by 1970 the market for secondhand turbo-prop aircraft such as the Electra will be flooded, because major operators throughout the world have already placed massive orders for jet aircraft as replacements, the Commission believes that any decision to further extend the life of this aircraft is economically and operationally unsupportable.

Surely, in a country like Australia, in this modern day and age, when a company in the airline business with the experience that Trans-Australia Airlines has in the operation of aircraft in Australia indicates to this extent its unhappiness with a system which requires that it shall retain in its fleet aircraft which are known to be obsolescent and economically difficult to continue to operate, then the pursuit of this idea is completely wrong.

Yet we find that Trans- Australia Airlines, which, as 1 said, is doing quite substantially more business than its competitor, is not able to equip itself with sufficient aircraft to enable it to give the type of service which it wants to provide to the public and which in fact ought to be given to the public. The Opposition is not against this proposal but, when we are being required to back with legislative action the borrowing of money to enable TAA’s competitor to acquire a type of aircraft similar to that operated by TAA we seriously believe that the time must surely have arrived when we ought to be able to have a look at the operating costs and balance sheets of Ansett Transport Industries Ltd in order to assess the financial viability of this organisation so that, as a responsible Parliament in this country, we can say whether we ought in fact to give backing to an airline whose balance sheets, financial operations and so on are not known to us and are not likely to be known to us.

I have a copy of the report which was put out by Ansett Transport Industries Ltd for the year 1968. It takes into its balance sheet certain aspects of its airline operations in this country but gives none of the specific details which would enable us to make the sort of assessment of the financial and economic viability of this organisation that would permit us to take the action which we are proposing to take to back a loan raising by this company for further airline equipment to operate its services in this country. To me, it does not seem to be unreasonable, if we are prepared to back this organisation to the tune of $4.3m - I believe that is the figure - to be told what the balance sheet of this particular phase of the operations of Ansett Transport Industries Ltd reveals. We ought to see it laid before us so that we can make a proper assessment as to whether it is a goer - whether it is an economic proposition.

Senator Sim:

– It seems to be a goer.

Senator DEVITT:

– It cannot help but be a goer, surely. If you tie its competitor down in the way you have tied TAA down, how in blazes can it be anything else but a goer? The position at the moment is that TAA can have a seating capacity only for a certain limited amount. If it gets bookings in excess of that limited amount - and it is limited by the airline equipment which it has - the only thing it can do is pass over the surplus booking to its competitor. What sort of a system is this? It does not do anything to give any encouragement or incentive to TAA to improve its service to the people of this country. Nor does it give the sort of encouragement that it ought to give to the competitors of TAA to ensure that they, too, provide a better standard of service to the people of this country. This is the thing that I am interested in. It is of no use Senator Sim trying to interject. He can have a go later on if he likes. I am not going to answer him because I want to make my speech. He can make his in due course. If he can justify a system which requires that the better performer shall be pulled down to the level of the poorer performer, then he can get up and do that in due time. But for the moment, I ask him to let me go on.

At the moment, I do not know whether Ansett Transport Industries ought to be required to purchase 2 or 3 more aircraft. We cannot decide that unless we can have a look at the balance sheet. That is the fly in the ointment. That is the nigger in the woodpile. Ansett Transport Industries is calling the tune.

Senator Byrne:

– What do you mean by your amendment when you say that the amount ought to be raised out of revenue? Do you mean the revenue of the airline company, or do you mean Consolidated Revenue?

Senator DEVITT:

– I mean that it should be raised out of the Consolidated Revenue of this country. Why go to Switzerland and borrow 9 million Swiss francs? Why go to the United States of America and borrow something else? The point I was trying to make is that it ought to be possible for us as a responsible Parliament in this country to assist Ansett Transport Industries to buy an additional aircraft. I know that right at this moment TAA cannot meet its obligation to provide sufficient seating capacity for the people who want to fly with that airline. It is no incentive to that airline to be tied down to the lower performance of its competitor. I shall continue to make this point whenever I rise to address myself to anything which affects the airline industry of this country.

We are asked to back a proposition whereby we will buy one Boeing 727. We have still got a DC9 to go on to the Australian routes in August next year. That will complete the orders for aircraft that have been placed up to date. I ani informed that the airline system of Australia works at a higher level of booking than any other airline system in the world, lt works on a capacity of about 70%.

Senator Byrne:

– Is it necessarily a good thing to work to the highest attainable capacity?

Senator DEVITT:

– No. I do not think it is. I do not think it is good because it is not providing the sort of service the people want. That is the point I am trying to make. But this seems to be a sort of norm. The level that is aimed at by whoever is responsible for this sort df thing seems to be a loading capacity of 70%. As I say, it is the highest in the world. This seems to indicate to me that the scheduling of flights and so on is pitched at the highest traffic offering and caters for nobody else. I do not think that is a matter for congratulation.

Senator Webster:

– It is fair to say that private enterprise aims at the greatest efficiency.

Senator DEVITT:

– When you strangle or emasculate your competitor who is doing 4% or 5% more business than you do by ensuring that he has not the means to give you any solid competition, is that a good thing? Quite frankly, I cannot see it. As I indicated earlier, so far as borrowing by Qantas Airways Ltd is concerned, the Labor Party agrees with the proposition. Because of the peculiar system operating in Australia the Government is underwriting a loan by Ansett Transport Industries Ltd. The Opposition has no objection to this course being followed because all that is happening is that the Government is facilitating the raising of a loan by a company which might otherwise have difficulty in doing so. But we oppose the borrowing of $4. 3m from various countries for the purchase of Boeing 727 aircraft for TAA. We believe that it is not a reasonable proposition to go into hock all around the world to provide ourselves with necessary means of transport. I move an amendment to the motion for the second reading of the Loans (Australian National Airlines Commission) Bill in the following terms:

At end of motion add: but, whilst not opposing the purchase of new aircraft by the Australian National Airlines Commission, the Senate is of the opinion that the financing of the purchase of the aircraft should be met from revenue and not from loans raised overseas’.

The ACTING DEPUTY PRESIDENT (Senator Ridley) - Is the amendment seconded?

Senator O’BYRNE:
TASMANIA · ALP

– I second the amendment and reserve the right to make my remarks at a later stage.

Senator PROWSE:
Western Australia

– The Opposition has carried on with its usual criticism of Australia’s two-airline policy. We have heard this criticism before. I understand that the Opposition does not oppose these three Bills, although it has moved an amendment to the motion that the Loans (Australian National Airlines Commission) Bill be now read a second time. I am very surprised that the Australian Labor Party objects to the borrowing of money overseas for this purpose. Often honourable senators on the opposite side of the chamber have been very critical of the fact that the inflow of capital from abroad is being invested in and is buying out Australian industries. There has also been criticism to a modified extent from this side of the chamber. But here we have a situation where it is recognised that Australia’s capacity to invest in her development at a satisfactory rate is limited by the money available for investment. Australians are in fact investing or ploughing back into industry 25% of the gross national product. That is one of the highest rates of reinvestment in the world. But it is still insufficient and we have to find 10% of our requirements abroad. There are two ways in which we can obtain this money; either by an inflow of capital for investment purposes or borrowing by a government instrumentality. On a previous occasion in this chamber I expressed the opinion that as a result of the experiences of the 1930s we had gone too far in pursuing a policy of not borrowing as much money from abroad as we should, having regard to the two alternatives of government investment or foreign investment from abroad.

Senator Cant:

– What about increased exports?

Senator PROWSE:

– -That flows from right investments. I believe that we will increase our exports if we are able to maintain a satisfactory rate of investment. It is obvious that if the terms of the amendment to the motion were brought into effect and the financing of the purchase of aircraft was met from revenue and not from loans raised overseas it would mean increased taxation or diversion of taxation for this purpose. It would also mean that the availability of money for private investment in this country was reduced by that amount.

Senator Cormack:

– Or public investment.

Senator PROWSE:

– Yes, public or private investment in the Australian economy. Here we have a clearly defined and justifiable borrowing at a known rate of interest which I believe will cost the country less than some of the private rates paid on overseas investments. I strongly oppose the amendment to the motion and express my surprise at the shortsightedness of the Opposition in moving it.

Senator GREENWOOD:
Victoria

-I rise to support the motion and to oppose the amendment. The Senator is discussing three Bills concurrently. My remarks are directed to the Airline Equipment (Loan Guarantee) Bill, which relates to a guarantee by the Commonwealth of a loan secured by Ansett Transport Industries Ltd, and the Loans (Australian National Airlines Commission) Bill, which provides for certain moneys to be borrowed by the Commonwealth for use by the Australian National Airlines Commission. The first Bill is necessary because Ansett Transport Industries Ltd desires to purchase a fifth Boeing aircraft. Under the terms of a policy which has been laid down and followed over many years, the Commonwealth will guarantee any loan secured by that company for the purpose of purchasing aircraft, the purchase of which has been approved by the Commonwealth. It therefore follows that the Australian National Airlines Commission - Trans-Australia Airlines - will adopt the same policy as Ansett Transport Industries Ltd and acquire a further aircraft because one airline is not granted permission to acquire further aircraft unless the other airline also has permission.

It is necessary that moneys be borrowed to enable the purchase of the aircraft which TAA requires. This is all part and parcel of a two-airline policy, which is Australia’s distinctive contribution to the airline policies of the world. It has been recognised that Australia’s policy is unique. It has been suggested that Australia’s policy is the envy of other countries which wish that they could have the sort of rationalisation that we have. The aircraft industry is essentially a costly industry and to be able to rationalise it in terms of what Australia can afford and can provide is a very significant contribution-

Senator Devitt:

– What would you do about it if TAA said it could run more aircraft?

Senator GREENWOOD:

– With all respect to the honourable senator, it does not matter what TAA thinks or says it can do. The policy which has been adopted in this country is a policy that is part of a conscious and deliberate act by the Government and is part of the philosophy of the Government. As distinct from those who would have one airline, and one airline only, providing a service, and who would have had one airline except that the Constitution prevented it, the Government believes that people should have a choice.

Senator Byrne:

– Does the honourable senator think that they should have the choice of more than two airlines?

Senator GREENWOOD:

– I appreciate that there are many viewpoints competing to be heard. My concern is to assert that this is part of the two-airline policy. I appreciate that once one concedes an element of choice and asserts that choice as provided by the two airline policy - Senator Gair and Senator Byrne suggest, one may have a further choice - there is always the question of how far one can take this element of choice when set against the economies and finances of the industry.

Senator Byrne:

– Is that not a matter for the competitor who elects to come in.

Senator GREENWOOD:

– I hear from those erstwhile members of the Australian Labor Party, who once upon a time supported the socialisation platform of the Aus: tralian Labor Party, that they are now asserting the benefits of free trade and private enterprise. There is always the problem that, if we give an absolute licence to private enterprise in circumstances where public safety is involved and where the economics are so enormous, there may not be regard for the service which is to be provided and we lose as a result of giving unrestricted licence. The Government has had to make its choice and it has chosen in terms of a two airline policy which has been operating now for over 15- years. I would have thought that in terms of the service which has been provided Australia has much to be proud of. These Bills come before the Senate simply because in the natural course of progress the airlines desire to have a fifth Boeing aircraft.

I do not desire to involve myself in the investigations which Senator’ Devitt invited by considering whether or hot the aircraft are required or are to be preferred as against other aircraft, but I understood him to say that he felt there was no objection to be raised to the purchase of the fifth Boeing. For the purpose of indicating a facet of this two airline policy I refer to what was said on the occasion when the Airlines Agreement Bill was before this Parliament in October 1961. I refer in -particular to the speech of Mr Townley, the Minister representing the Minister for’ Civil Aviation, in the House of Representatives, when moving the second reading of. that Bill! He said:

The Government’s two airline policy requires a situation in which the airlines operate fleets which are comparable in quality and capacity. Secondly, the fleets must be operated under regulated competition which avoids overlapping of services and wasteful competition with due regard to the interests of the public and a proper relation between earnings and overall costs. Thirdly, the two airlines should, as far as practicable, enjoy comparable cost structures. .

Senator Gair:

– We could do with another airline.

Senator GREENWOOD:

– I think the statement I have read neatly epitomises the policy which this Government has followed.

If Senator Gair is prepared to get up and support the case for a third airline then I would be interested to hear him talk about it in terms of the cost and economics of the situation. It is all very well to say that there ought to be a third airline, but what has to be considered is whether or not the Australian economy and the existing airlines can satisfactorily accept a third airline, and conceivably a fourth or fifth - because once we accept a third then we cannot limit other people coming in also - as against all the qualities and benefits which our existing airline system provides.

Senator Webster:

– Is it not a fact that today even some of the commuter airlines which recently have gone into the business of their own free will are now in some financial difficulty?

Senator GREENWOOD:

– I accept what Senator Webster says without any appreciation myself of the situation, but certainly there is this facility within the States for any airline to establish itself, and that is something upon which the Commonwealth has absolutely no power to regulate or to prevent. I have referred to the statement made by Mr Townley because it indicates that we have a two airline policy, one of the facets of which is that each airline should have a comparable cost structure. This policy is to be found expressed in the provisions of the Act. The Airlines Agreement Act of 1952- 1961 contains a Schedule which represents the agreement which was made between the airlines. Clause 10 of that agreement provides: (1.) The Commonwealth will not exercise any of its powers under or by virtue of an Act, including a power to make regulations, so as to discriminate against the Company. (2.) The Commonwealth will during the continuance of this agreement accord to the Company substantially equal treatment with the Commission in relation to the grant of import licences and the allocation of airport facilities.

Of course, the Commission and the company which are referred to in that clause are the Australian National Airlines Commission, which is colloquially represented by Trans-Australia Airlines, and Ansett Transport Industries Ltd, which is represented by Ansett-ANA. lt is apparent that there was to be substantially equal treatment.

When one considers the Australian National Airlines Act one finds similarly in built protection to prevent discrimination.

Section 37 of that Act provides:

The Commission shall pay all rates, taxes and charges . . . imposed by or under any law of the Commonwealth and such other rates, taxes or charges as the Minister specifies.

The Commission referred to in that section is the Australian National Airlines Commission. There would be no point in having that provision in the Act unless it was to make quite clear that the Commission was not to be given favoured treatment. I feel there are developing as part of this two airline policy - which I think is the Government’s very justifiable contribution to the political philosophy of this country - some departures from this equality of treatment. The equality of treatment is basic to the operation of the two airline policy. One aspect upon which I think there is a departure is in the relative cost of money to each organisation. They have to borrow. They have to obtain funds and the charges and the interest which they have to pay ought to be fairly comparable. There is also, as far as TAA is concerned, the advantage to it in the use which it is able to make of the employees superannuation trust funds. There is no comparable body of funds available to Ansett-ANA and, of course, all the money it seeks to get it must obtain on the loan market or from whatever source is available.

Senator Sim:

– The amount is now $20m a year.

Senator GREENWOOD:

– I hear from Senator Sim that the figure is $20m a year and I hope that he will elaborate on this in due course because I feel it is important for us to recognise that the two airline policy - if it is to continue - requires comparable treatment of the two airlines. When one applies this principle to the two Bills which I have mentioned it is useful to refer to what the Minister said in his second reading speech. He said that TAA will be in the same position as the Commonwealth Government in respect of the money which the Commonwealth Government borrows for the purpose of financing the purchase by TAA of its fifth Boeing aircraft. The Minister said:

The Commonwealth will be the borrower in the first place, and the full proceeds will be made available to TAA on terms and conditions to be determined by the Treasurer pursuant to clause 7 of the Bill.

Clause 7 of the Bill so indicates. The Minister went on to say:

These terms and conditions will be the same as those under which the Commonwealth itself borrows the money.

But when one looks at the Act one sees that one of the terms under which the Commonwealth borrows the money is contained in clause 4 of the schedule. It states:

The payments of interest and premium, if any, and the repayments of principal and the commitment fee will be free of all present or future taxes imposed by the Commonwealth or by any taxing authority thereof or therein, except to the extent that the right to receive payments comes to be beneficially owned by any person residing in or ordinarily a resident of Australia or the Territory of Papua or the Territory of New Guinea.

What that means, in short, is that the Commonwealth will1 not impose the normal withholding tax which it imposes upon money paid in Australia and receivable by somebody outside Australia. In other words, the interest which is received by the persons from whom the Commonwealth is borrowing money will not be subject to any withholding tax and the lender will receive payment in full. When one considers the position with regard to Ansett Transport Industries Ltd, it is apparent that it will have to pay on the money which it is borrowing from the American ImportExport Bank a 10% withholding tax. What the Commonwealth is doing with regard to the loan for Ansett-ANA is to guarantee its repayment and to guarantee that the interest will be paid, but Ansett-ANA still has to pay the withholding tax because of the agreement which has been made. The agreement which it makes with the lender requires that the borrower, Ansett-ANA, will make up and pay to the lender any tax which is deducted from the amount which is received by the lender from Australia.

Senator O’Byrne:

– Does the AuditorGeneral ever look at these affairs?

Senator GREENWOOD:

– I regret that Senator O’Byrne does not appear to follow what I am saying. The simple point which arises out of this is that TAA is receiving, in effect, a sum of money with which to buy a fifth Boeing aircraft, in respect of a substantial proportion of which supply of money it has to pay no interest. On the other hand, Ansett-ANA is receiving a guarantee of money with which it will buy a fifth Boeing aircraft, in respect of which it has to pay a certain sum by way of interest and withholding tax. 1 suggest that in that very fact there is discrimination.

Senator Devitt:

– How are we to know whether what we are told by Ansett is true? We will have no statement from him. We are being asked to back a loan and yet we know nothing about his financial arrangements.

Senator GREENWOOD:

– Senator Devitt has asked a question and, if given an opportunity, I shall answer him. He suggests that whether or not Ansett has to pay anything depends on an examination of his books and records which we do not see, but I say that that is quite irrelevant. If honourable senators will bear with me, one has only to look at the agreement under which the money is borrowed, lt is by that agreement, as with any contract, that the liability is determined. If honourable senators look at the agreement, which is contained in the Bill’s now before the Senate, they will appreciate that what I am saying stares at them unmistakably just for the sake of their looking.

When one considers what the position is with regard to the differentiation between TAA’s position and Ansett-ANA’s position one finds firstly that there is a difference in interest and charges on the loans of approximately $38,549. I do not intend to detail how these amounts are made up, but if any honourable senator is interested 1 suggest that he look at the Hansard report of the debate in the House of Representatives where the amounts are stated in detail. The effect is that Ansett-ANA will’ have to pay more than $38,000, an amount which will not have to be paid by TAA. In addition there is a second amount of $15,000 a year for a chattel mortgage registration fee, an amount which Ansett-ANA has to pay but TAA does not have to pay. Thirdly, there is an amount of approximately $75,000 in withholding tax, to which I have already referred, which TAA does not have to pay but which Ansett-ANA has to pay.

My sole point in raising these matters is to emphasise that there is occurring a discrimination which is contrary to the professed policy which this Government has laid down and which it purports to be fol<lowing. My remarks serve additionally the purpose of answering the point which Senator Devitt has sought to make, that in some way TAA is in a stronger and superior position and can compete with its rivals in a superior manner, that therefore it ought to be given that monopoly which 23 years ago the Australian Labor Party sought to give to the National airline.

Senator Devitt:

– I did not say ‘monopoly’.

Senator GREENWOOD:

– If the honourable senator did not say that precisely I have misinterpreted his remarks, but that is the sense in which I understood him to be making the statement. I hope that the Minister will have regard to what I believe are the obvious facts which have been disclosed in these financial considerations. 1 think it is only fair that while the Government professes to have a two-airline policy in which there are comparable cost structures, it should adhere to that policy. I cannot see that there is any unfairness in what is being done in this case once that premise is accepted, lt is a competitive industry in terms of obtaining the money which is available, and I should have thought, so far as Ansett-ANA is concerned, that it should not be prejudiced simply by the fact that TAA is able to rely on the Government and Government revenues to obtain the finance it requires. 1 think there is no doubt that the purchase of a fifth Boeing aircraft by each of the major airlines, and the prospective purchase of further aircraft, is testimony to the progressive ability of the two-airline policy which provides a choice, which the existence of just one airline would not provide, to cope with the needs of the Australian public. I feel that if the two-airline policy is to serve the people in the way that it has in the past, and if it is to continue to be useful in Australia’s situation, it requires that the basic conditions upon which it was formulated be preserved. It was for that purpose and that purpose alone that I drew attention to these facts. I hope that consideration will be given to them by the Minister.

Senator CORMACK:
Victoria

– I looked at the amendment moved by Senator Devitt and I thought that at this stage we were addressing ourselves to that amendment. The honourable senator claimed that the Opposition was not opposing the pur chase by the Australian National Airlines Commission of new aircraft. I must say that it is a charming way to support the purchase of new aircraft when the Opposition moves: the Senate is of the opinion that the financing of the purchase of the aircraft should be met from revenue and not from loans raised overseas.

I thought that was the subject matter of the debate.

Senator Cant:

– Why not bring Senator Greenwood back onto the track.

Senator CORMACK:

– I am addressing myself to the mover of the amendment and strictly to the amendment - not to Senator Greenwood. I am aware that the three Bills - the Airline Equipment (Loan Guarantee) Bill, the Loans (Australian National Airlines Commission) Bill and the Loan (Qantas Airways Ltd) Bill - are being discussed together. Senator Devitt moved the amendment and I assume in the polity of the Senate that we, in terms of the Senate procedures, address ourselves to the amendment that has been formally moved by him. If I am wrong in my assumption I would be grateful for your advice, Mr Acting Deputy President, and subsequently for your direction. However, addressing myself to the amendment in the strict terms and with the formalism which I believe the Senate will acknowledge in me, I must make some reference to a snivelling remark made by Senator Devitt.

Senator Devitt:

– What sort of remark?

Senator CORMACK:

– Snivelling. The snivelling remark was: Why should the airlines be concerned in filling the seats of the aircraft? That is what he said, but what is meant by this talk of filling the aircraft seats to 70% of their capacity? As the honourable senator was reared in Tasmania where there is a socialised method of running a transport system, where railways run up from Hobart to Launceston and back again with no seats filled, I assume that he considers that to be an ideal system of transportation.

Senator Devitt:

– When did I say that?

Senator CORMACK:

– You said it in your speech.

Senator Devitt:

– Mr Acting Deputy President, I ask Senator Cormack to spell that out because I did not say that. If he cannot spell it out I ask him to withdraw. It is so ridiculous.

The ACTING DEPUTY PRESIDENT (Senator Ridley) - Senator Devitt, if you claim to have been misquoted by Senator Cormack you may ask for leave to contradict his remarks after he has concluded his speech.

Senator CORMACK:

– 1 do not wish to embarrass you, Mr Acting Deputy President. If Senator Devitt is claiming that I misrepresented him the only thing on which he can base his claim is that I used the word snivelling’. I withdraw that word unreservedly. When speaking to his amendment he claimed that there was no reason to take a level of 70% of seats filled as the equation by which you measure the efficiency of airline operations. I make this clear because it was the gravamen of his speech. I went on to say that his claim might be explained by his experience in Tasmania where they run a train from Hobart to Launceston that has no seats filled but they run the thing up and down anyway.

One point overlooked completely by Opposition senators is that you do not enter into an airline operation until you can fill a certain number of seats. You raise the finance necessary to purchase aircraft on the basis of t he assessment of the number of seats that you can fill. That aspect has never been mentioned by any honourable senator at any stage in this debate. If you want to raise money to purchase aircraft you have to demonstrate to those people from whom you seek to raise the money that you can fill so many seats per flight. That is the measuring stick you use when you seek to borrow money to purchase aircraft. It does not matter whether Trans-Australia Airlines, Ansett-ANA or Qantas Airways Ltd is involved, if you are in the airline operation business you borrow money on the basis of your ability to repay it, and you repay it on the basis of the number of seats you can sell.

Three elements are involved in this. Firstly, there is TAA which operates on high revenue producing trunk routes; secondly, there is Ansett-ANA which operates on high revenue producing trunk routes and feeder services, and thirdly, there is Qantas which operates on international routes. I repeat that you borrow money to purchase aircraft on the basis of the capacity of the aircraft operating over the route selected for it. The same thing applies to ships. Ships operate on the basis of voyages; aircraft operate on the basis of the seats you can sell or the cargo hatches you can fill. You base your funding operations on the capacity of the airline, whether it be TAA, Ansett-ANA or Qantas. That is the basis on which you get your aircraft. If you wish to buy a cheap, slow, non-competitive aircraft you can buy it on the world’s markets at a far lower price than that at which you can buy the aircraft which Senator Devitt complains is necessary for Australia. Let me give an illustration. General Dynamics Corporation produced the Convair 880.

Senator Devitt:

– The Fill too.

Senator CORMACK:

– 1 am talking about the Convair 880. If you wish I will talk about the aircraft which the British Aircraft . Corporation cannot sell.

Senator Poyser:

– I thought you were sticking to the amendment?

Senator CORMACK:

– I have been sidetracked but I will come back to it in a proper and pertinent way in a moment. The Convair 880 was being sold to world airlines on 5% deposit, with an American crew thrown in, on the basis of 70% of the seats being sold. Do you want that kind of aircraft and that kind of operation? That is what Senator Devitt is arguing. If you want an aircraft which cannot fill its seats and give the economy and characteristics required to carry out an efficient operation you buy the United Kingdom aircraft. You might be able to get that cheaper. The airline business is a competitive business which finally gets itself down to a question of finance. If you want to get an economic aircraft you have to pay for it.

Having said that, I now turn to the argument advanced by Senator Prowse. You can have one of two things: You can have either a low grade airline system or a high grade airline system in Australia. If you want to have a high grade air transport system in Australia you have to pay for the aircraft which will give it to you. If you want to have low grade air transport system in Australia you can have that too.

Senator Devitt:

– I hope you were not a navigator if you got yourself lost as you are now.

Senator CORMACK:

– I would be much happier to go through the muck with a DC3 than to accept some of the things you are suggesting. The demand of the electorate in Australia is for a fast, efficient, safe, high grade aircraft on Australian trunk and feeder routes. We have to pay for those aircraft. Where do we obtain the necessary resources? This is the essence of Senator Devitt’s proposal that the purchase of the aircraft should be financed from revenue and not from loans raised overseas. How do you finance the purchase of aircraft? You can finance them in four ways. Firstly, you can impose an increased charge on the people of Australia. The Senate cannot do that constitutionally but it can request the House of Representatives to impose a charge on the people by way of increased taxation. Secondly, you can increase the fares that the Australian electorate is charged to travel on these aircraft. Thirdly, you can impose increased charges for the use of navigational facilities. Fourthly, you can make funding arrangements to borrow money based upon the transport capacity of the aircraft you intend to buy.

Senator Devitt:

– Do you not think the financial institutions would accept Government backing in a transaction like this?

Senator CORMACK:

– Then you should propose an amendment requesting the House of Representatives to increase taxation on the people of Australia to a level commensurate with the sum of money required to pay for the aircraft. That is the only alternative. As I have said, an honourable senator who proposes an amendment on the lines of Senator Devitt’s amendment has three courses open to him. Firstly, he can move to request the House of Representatives to increase taxation in Australia in order to raise sufficient public funds. The Opposition will not do that.

Senator Byrne:

– Can the honourable senator see any merit at all in charging it to revenue?

Senator CORMACK:

– Charging what? Whose revenue? Does the honourable senator mean the general revenue? I think that is crazy. The next thing the honourable senator will be asking the Government to do is to charge the cost of equipping Commonwealth Railways and the Australian National Line to the revenue, and so on. The airline system has to pay its own way and revenue has to be derived from it. I am not prepared - nor, I am sure, are any honourable senators sitting to your right, Madam Acting Deputy President - to have Australian taxpayers gouged in order to support airline systems. For 70 years Australian taxpayers have been gouged to support railway’ systems supported by subsidies and not operated on a profit and loss basis. The ‘railways’ were reduced to the stage, that they drove passengers away. We have been faced in Australia with a system of protected shipping and Australian travellers, in shoals, have deserted the ships. Finally, Australian travellers took to airlines because they obtained effective, efficient, speedy and comfortable travel with no Government direction as to how they should travel. The airline system is ‘based upon its capacity to show a profit. If it cannot show a profit then we should discard the airline system. So far as I am concerned, our airline system has to be based on efficient business management and this must rest on profit and loss. Money for that system has to be borrowed at the common market and not taken out of the general profit and loss account.

Senator WOOD:
Queensland

– I think honourable senators should be doubly grateful to Senator Greenwood who drew to our attention a weakness in the agreement and the arrangements and ideas which the Government has had in connection with the two-airline policy. There is no question that the basis of the original idea was to see that both airlines operated on an equal basis. The point that Senator Greenwood brought forward tonight is that in respect of financing the purchase of aircraft, the Government airline, Trans-Australia Airlines, has a distinct advantage over AnsettANA. It appears that this comes back to the fact that Ansett-ANA has to pay withholding tax, in respect of repayments of the loans, which TAA does not have to pay.

I think this shows up a weakness in the present arrangements. The points Senator Greenwood brought forward should be looked at by the Government. If the Government says that it wants both TAA and Ansett-ANA to operate on an equal basis it should see that this matter is adjusted in order that the original intention of the Government - and it appears to be its present intention - is carried out. This appears to be a very strong defect and gives an advantage to one airline. If the Government is consistent in its desire to follow the two-airline policy and to allow the two airlines to operate on an equal basis, then it has a duty to see that this serious defect is rectified. If it does not, then it is unfair to one airline.

Senator Gair:

– But the Government can borrow on a better basis and on better conditions than Ansett-ANA.

Senator WOOD:

– That is the basis of this matter. Under those circumstances, I think the Government should rectify the position in order to be consistent in what it says about its desire to maintain the present twoairline system. I think honourable senators owe a debt of gratitude to Senator Greenwood for bringing forward this very important point in this debate.

Senator CANT:
Western Australia

– At the outset of my remarks may I congratulate Senator Devitt on being able to stir the possum to the extent that Government senators have had to put up consecutive speakers in order to try to defend the Government’s two airline policy which discriminates against Trans-Australia Airlines, the national airline.

Senator Sim:

– What about the facts that Senator Greenwood recited?

Senator CANT:

– Senator Greenwood was completely confused. He was unfamiliar with the argument he presented. I would recommend to Senator Greenwood that he look at the decisions of the Rationalisation Committee before he speaks about the twoairline policy in Australia. The decisions of that Committee have favoured Ansett in every instance. I ask any honourable senator on the Government side to stand and deny that statement. I have not risen, Madam Acting Deputy President, in order to be critical of either Trans- Australia Airlines or Ansett-ANA. I fly with both airlines. I get good service from both of them. However, I am critical of the Government’s twoairline policy. If I may be excused for using such language, Madam Acting Deputy President, I think the Government’s twoairline policy stinks.

The Senate is dealing with three Bills at the moment. The Opposition is not opposed to the Loan (Qantas Airways Ltd) Bill or the Airline Equipment (Loan Guarantee) Bill. The latter Bill provides for a guarantee for a loan for Ansett-ANA in connection with the purchase of more aircraft. However, so far as TAA is concerned, the Opposition says that the money for the purchase of its new aircraft should come from Consolidated Revenue and not by way of a loan upon which we have to pay interest. This is the basis of the amendment moved on behalf of the Opposition.

We frequently sit in our places in this chamber and hear honourable senators on the Government side speak about free enterprise. How free is enterprise in Australia’s airline system? Will some honourable senator on the Government side stand and tell me how free this system is when one airline is restricted to the interstate routes while the other airline has a monopoly on intrastate routes? There is only one airline outside the ambit of Ansett Transport Industries Ltd and that is EastWest Airlines Ltd in New South Wales. Ansett Transport Industries is now making a bid for the final 29.5% of shares in MacRobertson Miller Airlines Ltd in Western Australia. Ansett Transport Industries presently holds 70.5% of shares in that organisation and now wants the remainder. When Ansett bought the monopoly in MacRobertson Miller Airlines, he promised to put jet aircraft or turbo-prop aircraft on the run but they are not operating yet and they will not be operating for a while. Ansett knows that they will not be operating on those routes until such time as the Department of Civil Aviation is able to provide the facilities to accommodate them.

Senator Sim:

– And until such time as the aircraft are available.

Senator CANT:

– If Ansett does not have the money to buy the aircraft he should not be in the business.

Senator Sim:

– What aircraft does the honourable senator recommend?

Senator CANT:

– I am not operating the airline. I do not know what the traffic will bear. It is up to the airlines to decide what aircraft they will purchase. Perhaps they want to continue using the F27. Perhaps they want the F28. The airlines can make their own decisions in accordance with the facilities that the Department of Civil Aviation is prepared to provide. For honourable senators to stand here and propagate a free enterprise economy when one airline is being strangled and the other has a monopoly of all flow-on traffic, is to deny the very principles that bring them into this place. Is this free enterprise?

Senator Greenwood:

– What about the rationalisation tribunal that does permit both airlines to have a fair share of the traffic.

Senator CANT:

– I have already said, in the absence of the honourable senator, that he speaks from ignorance in propagating a -two airline policy without having examined the facts of the two airline policy and without having considered one decision of the Rationalisation Committee. When the honourable senator has considered -the decisions pf the Rationalisation Committee he can speak with some knowledge of the subject, but up to date he has not been qualified to speak of the rationalisation provisions of the Airlines Agreement that are strangling TAA today.

Senator Greenwood referred to clause 10 of the Agreement. It is rather interesting to study that clause, which provides, in part:

  1. – (1.) The Commonwealth will not exercise any of its powers under or by virtue of an Act, including a power to make regulations, so as to discriminate against the Company.

That is agreed. But does it say anything about discrimination against the national airline? Not one word. The provision is set doen to protect the company against the national airline. The Agreement has only one purpose, and that is to protect the company against the national airline. Our major concern about the company - to refer to Ansett-ANA as it is referred to in the Agreement - is contained in clause 4 (d) of the Airline Equipment (Loan Guarantee) Bill, which states: undertakings to the satisfaction of the Treasurer are given that, for so long as the loan or any interest on the loan remains unpaid, officers employed in the Commonwealth Service will have full access at all reasonable times to the financial accounts of Ansett Transport Industries Limited and Ansett Transport Industries (Operations) Proprietary Limited-

The complaint of the Opposition with respect to that provision is that information is available to the Government irrespective of whether the Government exercises its rights under that provision. Such a provision is contained in every Act relating to an agreement to guarantee loans to Ansett-AN A. At present Ansett-ANA has a loan under guarantee by the Commonwealth Government so that access to the books of the two companies referred to in clause 4 (d) is provided for by virtue of the Loan Guarantee Act. When we provide a guarantee for a loan to Ansett Transport Industries Ltd we do not know just what we are guaranteeing. Are we guaranteeing a television station? Are we guaranteeing a motor body building works? Are we guaranteeing a group of motels and hotels? Are we guaranteeing a tourist resort? Are we guaranteeing tourist buses, or are we guaranteeing an airline? Information is available to the Government from the books of Ansett-ANA at a time when that organisation takes advantage of a Government guarantee for a loan, and it should be made public to the Senate, because the privileges and benefits that are given to Ansett-ANA are enormous. They are not worthy to be called part of the system of free enterprise. This Parliament should know exactly what it is guaranteeing.

Senator Webster:

– Ansett has never once missed on a repayment of a loan from the Commonwealth.

Senator CANT:

– Neither have the Chinese in respect of the under-priced wheat that the Government sells them despite the fact that honourable senators- opposite cast aspersions on the Chinese in respect of wheat sales agreements. Questions, about this matter have been asked in the Senate. That is no answer. We are asked to provide a guarantee for a loan to purchase aircraft equipment. We want to know whether we are guaranteeing that dr guaranteeing masts for a television station. The Senate is placed in the position that it docs not know exactly what it is guaranteeing. My Party has decided not to oppose the granting of a guarantee for the loan, but if I had my way I would not guarantee a loan for Ansett until the facts were laid before the Senate.

Senator Greenwood said a lot about the cost of money. I do not want to enter into a discussion on international taxation agreements but I do want to say that there is a difference between Ansett’s going on to the world market to borrow money as a free enterprise borrowing company and its going on to the market to borrow under guarantee by the Commonwealth Government. In this way Ansett is able to borrow at the same rates as are available to TAA, on a government to government basis even though it is not a government to government loan. Ansett is given that advantage because the Commonwealth Government guarantees the loan. It is quite wrong to say that Ansett has to pay more for the money he borrows. Over a period of years he has paid more for the money that he has borrowed because he has refused to take up the guarantees that the Commonwealth Government provided for him. Why? Because at that time he did not want the Commonwealth Government to examine his books while he was repaying the loan and any interest on the loan, lt is nonsense to say that Ansett has access only to dear money. That is not true. If he takes advantage of the guaranteed loans he has access to money as cheaply as it is available to TAA. lt is not appropriate to examine the two airline policy in the context of this legislation. However, we impress upon the Government that we are not fooled by what is said by honourable senators opposite. We are well aware of the position that is operating in Australia. We are well aware of the number of times that Ansett-ANA has been given access to profitable routes that have been operated by TAA. We are well aware of the times that TAA has applied for permission to operate routes that are currently being operated by AnsettANA and has been refused. We are well aware of the position with respect to air cargo transport - that TAA is denied access to air cargo transport on equal terms with Ansett-ANA. All these things are set out in reports of the Department of Civil Aviation which publishes the decisions of the Rationalisation Committee. At this stage we say that we should be given more information before we are committed to guaranteeing loans for Ansett Transport Industries Ltd. We aver that the loan, which is a miserable amount of money, should not be borrowed overseas with respect to TAA. We should not have to pay interest when sufficient overseas balances are available to meet the need.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– Here tonight we are confronted with three Bills. We are debating them concurrently. An amendment has been moved in relation to one of them. Therefore, if I may say so, the debate has become rather difficult to follow. With the indulgence of the Chair the debate has ranged over quite a wide canvas. But, be that as it may, I think 1 should try to deal with some of the items raised in some degree of isolation. I will deal first with the amendment, which seeks to add the following words at the end of the motion for the second reading of the Loan (Australian National Airlines Commission) Bill:

  1. . but, whilst noi opposing the purchase of new aircraft by the Austraiian National Airlines Commission, the Senate is of the opinion that the financing of the purchase of the aircraft should be met from revenue and nol from loans raited overseas.

As 1 look al that amendment I note certain arguments that have been put in relation to it. I do not think we can consider this matter in isolation. Because this is one particular loan, the Opposition says: This is a very modest amount: it should be met from revenue’. But the fact is that we have always found money for this purpose from loan raisings. We have found it from loan raisings as a matter of policy. That has proved a very practical and logical method in the past and there is no need to change that policy.

There is a fundamental principle that, if a person is in a revenue or income producing business and he can borrow money on reasonably favourable terms, then he borrows it and makes his business and the money he borrows work to pay the interest, on the money he borrows. I remember reading many years ago a story about some obscure city in America. The civic fathers decided that they would never borrow any money; that they would pay as they went; that if they could not afford to pay for something out of revenue they would not have it. The story was quite a colourful one. The climax of it was that the cities all around this city were borrowing money and using the money they borrowed to make more money. They were all living in prosperity and had all the amenities that were reasonably available to a civilised community. But the city which determined, on the basis of the philosophy of its civic fathers, that it would have only what it could pay for out of revenue was still in the backwoods. I am speaking in the broad now. The concept is that, provided a person can borrow money on advantageous terms, it is a self-feeding system which will enable him to make the money he borrows earn money for him. The basic principle is that the terms and conditions on which he borrows must be reasonable and equitable.

If we are to say that we will pay for these purchases out of revenue, to the extent that we use revenue we will have to have more taxation or less availability of funds for ordinary government services, or we will have to use a form of internal fiduciary issue. In these circumstances, that is not a valid course when one has a good business which can prosper on borrowed money if it is run properly. That is a fundamental principle. It is for that reason that the Government will follow the practice that it has followed before. It will borrow the money on reasonably good conditions and with a guarantee by the Government. So the Government will resist the amendment. But I am bound to say that the passing of the amendment would not prevent the passage of the Bill.

Another interesting point that was discussed was related to withholding tax. Some reference was made to this by both Senator Greenwood and Senator Wood. One point about withholding tax is that, in the ultimate, whether the loan secured from the ExportImport Bank by Ansett Transport Industries Ltd is subject to interest withholding tax or not is a matter for determination by the Commissioner of Taxation.

Senator Marriott:

– The Government guarantees the loan.

Senator ANDERSON:

– Yes, but the decision has to be made by the Commissioner of Taxation. The decision has to be made on the merits of the case. If the decision were in favour of Ansett Transport Industries Ltd - that is to say, if the company avoided the payment of withholding tax - the average cost to the company of financing the purchase of a Boeing 727 would be one-tenth of 1% less than that to Trans-Australia Airlines. On the other hand, if the company became subject to withholding tax - that is to say, if it had to pay the withholding tax on the Export-Import Bank loan - the cost of this finance would be somewhat less than two tenths of 1 % higher than that of TAA. I bring that out although the matter still has to be determined by the Commissioner of Taxation. According to the way it was determined, it would be onetenth of 1% advantageous or two-tenths of 1% disadvantageous.

Senator Devitt:

– That applies only when the company borrows overseas, does it not?

Senator ANDERSON:

– I am speaking of this in relation to this case. Senator Cant used an argument that was used by Senator Devitt. The basis of it was: ‘We do not know what Ansett Transport Industries Ltd is doing with the money it borrows. We do not know whether it goes into aircraft or into some other purpose associated with the multiplicity of business interests of this organisation*. The loans to TAA and Qantas Airways Ltd being approved by these Bills and the loans to Ansett Transport Industries Ltd being guaranteed are required to be used solely for financing the purchase of the aircraft described in the loan agreements.

Senator Devitt:

– Who checks it?

Senator ANDERSON:

– If that is the law we can assume that that is what will happen. I hope that the honourable senator is not suggesting that, if this is required, by some Nelson’s eye or other device-

Senator Devitt:

– I am not suggesting anything. 1 am asking who determines this matter.

Senator ANDERSON:

– I would have thought that it ‘ would be determined in the Treasury. The situation is that as the loan is required one of the conditions on which it is made available is that it is used for the categorical purpose for which it is raised.

Senator Devitt:

– I am not doubting that.

Senator ANDERSON:

– I know that the honourable senator is not doubting that. It is a statement of fact which has been given to me by my advisers.

Senator Devitt:

– Why cannot the Parliament have a look at it?

Senator ANDERSON:

– What does the honourable senator want the Parliament to look at? I am telling him that this is a condition of the loan. If he does not accept that-

Senator Devitt:

– Why cannot we look at it in a balance sheet as in the case of any of the other affairs of the country?

Senator ANDERSON:

– The honourable senator is trying to twist the point now. I am telling him that a condition of the loan is that it has to be used for this purpose. One does not have to look at a balance sheet’ to work that out. It is an established practice and an established fact. I hope the honourable senator accepts it as such.

Senator Devitt:

– I am sorry, but I would like to .know how we can look at it.

Senator ANDERSON:

– The honourable senator can look at it through the Public Accounts Committee or any way he likes, but the fact is that it is there. He may use the forms of the House to establish it if he does not accept it as a fact. I am merely telling him that that is the situation. I propose to give some general information in relation to the matter. Then we can vote on the motion for the second reading and proceed to deal with the other Bills. At November 1969 TAA and Ansett-ANA each have six DC9 and five Boeing 727 aircraft. The fifth Boeing 727 is the subject of the two Bills under discussion. It should be remembered that TAA and Ansett-ANA have agreed to the following additions to their main fleets: Six DC9 and one Boeing 727 aircraft between March 1970 and June 1972. Each airline has agreed to the progressive retirement of the existing units of its fleet. This programme has been worked out as part of the two-airline policy. That policy was debated at length tonight. The debate became a little difficult to follow and somewhat rugged because of the interjections. I have no doubt that the provision of appropriate finance for each airline is based upon the two-airline policy. My second reading speech made it clear that the aircraft are required because of the terrific expansion in the long distance routes. I think Senator Cormack made the point that the airlines base their requirements on the anticipation of work load. A lot has been said about our two-airline policy, rationalisation and other matters. Currently those matters are under review by the Government. In any plan of things there can be areas where the scheme operates more effectively than in other areas.

Senator Devitt:

– When has the scheme been reviewed?

Senator ANDERSON:

– It is constantly under review. From time to time things which need to be examined emerge. I would say that the system serves Australia well. It has produced competition which is healthy, and good for Australia. Both TAA and Ansett-ANA should be given the necessary financial support to enable them to purchase modern aircraft. In that way they can provide service which is unique having regard to the size of our continent, our need for aviation facilities and our limited population. I think we can pass this legislation with some degree of confidence that it will help in the further progress and development of both the two-airline policy and the aviation industry.

Question put:

That the words proposed to be added (Senator Devitt’s amendment) be added.

The Senate divided. (The President - Senator Sir Alister McMullin)

AYES: 23

NOES: 27

Majority

AYES

NOES

Question so resolved in the negative.

Original question resolved in the affirmative.

Bill read a second time. .

In Committee

The Bill.

Senator MURPHY:
New South WalesLeader of the Opposition

– I should like to ask some questions on the Schedules to the Bill. Could the Minister tell me how much in all will be paid to the Union Bank of Switzerland and for what services in connection with this loan it will be paid? 1 refer next to Article X of the Second Schedule. 1 refer in particular to that portion which relates to the use . of aircraft. Why is it that this provision has been agreed to by the Federal Government? The provision reads:

The borrower-

That is Australia - represents and warrants that the Aircraft will be used by the Commission principally on routes of the Borrower between termini in Australia and that all other items of Equipment will be used by the Commission principally in Australia.

Why should the sovereign Government of Austrafia allow itself to be restricted in this way? We are borrowing money to acquire aircraft. They are our aircraft. We are paying the interest and commitment fees, and we are going to repay the principal. Why are we being tied down as to the manner in which these aircraft will be used? For instance, why could not we, if we wanted to, interchange this aircraft with aircraft that we might use with Qantas Airways Ltd? Why do we allow ourselves to be confined in this way by people who are not really in any risk as to the repayment of their money? Why do wc allow this kind of restriction in the use of aircraft to be applied to this country?

Senator Little:

– Because we cannot get the money anywhere else.

Senator MURPHY:

– lt is not a tremendous amount of money.

Senator Little:

– We could not borrow it from General de Gaulle.

Senator MURPHY:

– We do not know. It is a serious matter when a country such as Australia, with its own national airline, is allowing itself to be tied down in the use of aircraft. As far as I know, this will apply permanently. I should like to ask another question. It is in paragraph H of the same Schedule and relates to future employment. The provision reads:

The borrower-

That is Australia - covenants that during the period of two years after August IS 1968 h will not employ or enter into any understanding to employ any person:

  1. who was a director, officer or employee of Eximbank at any time during the period of one year prior to the said date; or (2) who is a director, officer or employee of Eximbank at tha time of such employment or understanding to employ, unless in either case such employment is approved in writing by Eximbank after full disclosure to it of all facts in connection therewith which it deems to be relevant.

It seems to me that two considerations arise here. Why again does this sovereign nation tie itself down so that it cannot employ such persons? After all, we are not the same as some private person or company. This sovereign nation is debarred from employing persons except after full disclosure of all the facts in connection therewith to the Eximbank, and then only after approval in writing of the Eximbank is received.

The next consideration that arises is: Is this reciprocal? Why is there no provision relating to the other side so that they are not to employ persons who have been engaged here in connection with these transactions? I do not put this inadvisedly and my concern relates not only to this matter but also certainly to the other matter. I should like to know what endeavours have been made to see that persons who were concerned on behalf of Australia in these transactions of borrowing with overseas companies, particularly so far as relates to the moneys borrowed from the Morgan Guarantee Trust Companies, have not become employed or engaged by or members of these particular organisations.

Senator Greenwood:

– Surely they are very difficult questions to answer without notice, at the present time.

Senator MURPHY:

– The Bills have been presented here and I have no doubt that the Minister representing the Treasurer (Senator Anderson) will do his best to answer them. He is putting the position to us. There is another question I should like to ask. It relates to Article XIII, which deals with marine transportation and insurance. The provision about which I am concerned reads:

All items of Equipment, the purchase of which is to be finaced in whole or in part under the Credit and which have been or shall be exported from the United States by ocean vessels, must have been or shall be transported from the United States in vessels of United States registry, as required by Public Resolution No. 17 of the 73rd Congress of the United States, except to the extent that a waiver of such requirement is obtained from the United States Maritime Administration. In the event that a waiver is obtained, the cost of ocean freight for shipments on vessels of other than United States registry shall not be eligible for financing hereunder.

Has the Government made any attempt to obtain any similar protection for Australian vessels? Why does it enter into such an arrangement? Why does it not, as a sovereign nation, insist upon a prior waiver of any such requirement so that these obnoxious provisions do not appear in an agreement that we are asked to approve? Why should not the Australian Government transport its aircraft in such vessels as it thinks fit instead of being required to transport them in United States vessels?

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I shall refer first to Article XIII which relates to marine transport and insurance. The short answer that I have been given is that only those parts of the equipment which are to be shipped become subject to this provision. The provision is required by a resolution of the United States Congress and applies to all borrowers from the ExportImport Bank. This is one of the conditions of the loan.

Senator Murphy:

– lt is pretty hot, is it not?

Senator ANDERSON:

– The fact is that it is a condition imposed by the lender and is acceptable to the borrower. Senator Murphy also referred to future employment. Article X prevents the Commonwealth from employing Eximbank officials for 2 years, is a standard provision in all Export-Import Bank agreements. The provision allows employment within 2 years if the Eximbank is given the full facts and approves. The provision is apparently a safeguard that the Eximbank is required to place in its agreements with a view to making clear that there is no arrangement of loans by Bank employees for borrowers who are at the time prospective employers.

Senator Murphy:

asked a question regarding use of aircraft. As I understand the position, this condition was acceptable to the borrower. After all, Trans-Australian Airlines operates wholly on Australian routes. This condition is acceptable to TAA. Senator Murphy also asked about payments to the Union Bank of Switzerland.

He wanted to know how much was to be paid and for what purposes. An amount of 148,500 Swiss francs is to be paid as a placement fee, which corresponds to the underwriting fee in a public loan. It is payment for arranging for funds to be available. That is all the information 1 can supply at the moment. I suggest to Senator Murphy that he now carry on with other matters to which he wishes to refer. If I am unable to supply an answer to any query at this stage I will follow the matter up and ensure that Senator Murphy is provided with an answer in due course.

Senator MURPHY:
Leader of the Opposition · New South Wales

– The answer given by the Minister to my question regarding the Union Bank of Switzerland does not altogether satisfy me. I have no doubt that the Minister has endeavoured to explain the matter to me. It may be that no real explanation can be given. It hardly seems that the Union Bank of Switzerland is underwriting the loan. It is the lender. Is this not just a simple way of taking more money out of Australia? In its letter to the Commonwealth of Australia the Union Bank of Switzerland stated:

We are prepared to grant’ to you a loan of Swiss Francs 9,900,000 - on the terms and conditions set forth in the Loan Agreement, dated September 19, 1968, between you and ourselves.

The drawdown of the loan shall be on the Take Down Date designated by you persuant to Article I of the Loan Agreement.

We will receive, for our services rendered in connection with the granting of this loan, a commission of li% … of the principal amount of the loan. This commission will be due for payment on the Take Down Date of the loan, together with the amount of the commitment fee to be paid pursuant to Article I of the Loan Agreement.

What services has the Bank performed? It lends the money and in return receives the principal, the interest and a commitment fee. In addition it wants a commission of H% for the services it- has performed.

Senator Anderson:

– If you do not want it you do not take it.

Senator MURPHY:

– Why is it that we are paying that commission? Are we also paying a similar amount in respect of the rest of the money we are borrowing or is this a special rake-off for the Union Bank of Switzerland? I have mentioned marine transportation, which appears in Article XIII of the Second Schedule. I would also like to refer to insurance premiums, which are mentioned in paragraph B, which states:

Premiums for Insurance against marine and transit hazards on any items of equipment financed under the Credit will be eligible to be financed under this Credit only wilh respect to those policies of insurance which are payable in United States dollars and are placed in the United States market.

It does not appear that any resolution to the United States Congress is mentioned here, as there was in relation to marine transportation. Why should Australia enter into an agreement one of the clauses of which seems to be designed to advance the interests of the United States insurance corporations? One would think that Australia should be able to carry its own insurance or should be at liberty to insure the items under reasonable terms. Why should the Commonwealth enter into an arrangement which fosters the interests of United States insurance companies? Has the Government really addressed itself to these matters and borne in mind either competing private interests in Australia or the general interests of the Government to secure a kind of agreement which would not be made with a private company?

The’ Australian Government should not allow this country to be treated as if it were an ordinary private borrower. Australia is a sovereign country. Surely it should not allow itself to be treated in this way. We are dealing with an agency of the United States. There are all sorts of arrangements with the United States that deal with matters far more important than this one. Why should Australia be allowed to be degraded to the position of a private borrower?

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I think the first ingredient that should be taken into consideration here is that if somebody has something to lend and seeks to impose conditions, those conditions are subject to negotiation. This should be quite simple to Senator Murphy, who has been trained in the legal profession. The prospective borrower can negotiate in an endeavour to vary those conditions and if they are too onerous he can say: ‘I am not prepared to borrow because I do not like the conditions’, lt is as simple as that. Senator Murphy referred to the payment of a placement fee. It appears that the lenders have said: Tn addition to other things, we insist upon a placement fee’. Unless the borrower can show that it is not equitable or appropriate to impose a placement fee, he is eventually confronted with .a situation where he has either to accept the loan and pay the placement fee or reject the loan.

It could be argued that it is not reasonable to impose a condition that policies of insurance be payable in US dollars and be placed in the US market, but ultimately one comes back to the position that the lender says that unless this condition is complied with the money will not be lent.

Senator Byrne:

– This could be a condition imposed not merely on an anxious borrower but on a desperate borrower. Is Australia a desperate borrower?

Senator ANDERSON:

– I am assuming that it is a willing but not anxious borrower. The fact is that Australia is taking up a loan which it would not take up if it thought that the conditions were not fair and reasonable. Having set sail to take up the loan it may be proper to raise some queries about it. But this is the real test of it, is it not?

Senator Gair:

– Are we so desperate that we would accept those conditions?

Senator ANDERSON:

- Senator Murphy has made a point that they are severe conditions, but this is a debatable point. The truth is that it has been considered that the conditions are not too unreasonable. The normal thing in all big borrowings is that there is a placement fee. This provision has been written into the agreement. As Senator Murphy suggests, it has been superimposed.

Senator Byrne:

– Does the reason lie in the fact that we had to pay in dollars and had to get them from a dollar lending institution?

Senator ANDERSON:

– I do not think so. I think this is just a part of the terms and conditions of sale. Our people have looked at it.

Senator Byrne:

– Had we to go to the Export-Import Bank because it was a dollar loan and therefore our field of borrowing was limited?

Senator ANDERSON:

– The answer to that is that this was considered the most reasonable place to find the finance on the finance market. That is the test that we go on. It is the most reasonable source of finance, accepting that those conditions are applicable. The loan applies to goods purchased in the United States. Consistent with this, Article XIII, paragraph B, provides that only when premiums are payable in the United States can they be financed by means of this credit. As to why it should be payable in United States dollars, I point out that a similar provision appeared in the agreement approved by the Australian National Airlines Commission Equipment Act 1967. The proceeds of the insurance must be payable in United States dollars to ensure that funds are available in the currency required for purchase of replacement aircraft or repayment of a loan in the event of loss.

Senator Murphy:

– Why must it be placed in the United States market?

Senator ANDERSON:

– Because the United States authorities have said so. Nothing in the agreement prevents premiums being paid in any currency, including Australian dollars, as long as the proceeds are payable in United States dollars. Trans-Australia Airlines may therefore enter into contracts with insurance firms outside the United States.

Senator Murphy:

– It say that the policies must be placed in the United States market.

Senator ANDERSON:

– Only if we want to borrow the money for the premiums. We are getting involved and if there are any other elements in question I undertake to have further explanation provided for honourable senators.

Senator CAVANAGH:
South Australia

– The Minister has undertaken to get further information, but I think it should be forthcoming before we pass this Bill. Senator Murphy has brought up some very pertinent points. There seems to be a sellout of many principles by the Australian Government possibly, as Senator Byrne suggested, as a matter of desperation. Perhaps we were a desperate borrower. But should we be desperate over the borrowing of some S5.9m?

Senator Anderson:

– Who said we are desperate?

Senator CAVANAGH:

– It is the only explanation we can get as to why there is such a sacrifice. The normal lender seeks security and some guarantee as to capability of repayment. In respect of these two loans we go further than (hat. We cannot employ certain personnel. It is provided in the Schedule that we must convey equipment in United States ships and we cannot use any other shipping line if we so desire. We must have our insurance _ under United States guarantee.

Senator Murphy:

– If we use any of the money for insurance.

Senator CAVANAGH:

– If we use any of the money we must do that. Therefore, we have not the freedom which we would have if we were borrowing from a normal lender: He would require only that we have security and that we have capability of. repayment. Other than that, on what .we do repay there is some profit which we guarantee the United States as a result of the use of its facilities and this is essential under this agreement for the purpose of the loan. Senator Murphy asked whether this was right and the Minister said that if there were further particulars he would supply the answers on some future occasion.

Senator Anderson:

– I said that if there were any answer beyond the explanation I had already given I would be happy to give it.

Senator CAVANAGH:

– That is so but, the only information that the Minister has given is that this was an essential condition of the loan. Senator Byrne asked whether we were so desperate that we had to sell ourselves and submit to these conditions to get $5.9m for the purchase of aircraft. We do not think those conditions should have been placed on the loan. Senator Murphy believes that the Government should have another look at the whole question of this loan. I would like to know whether there are some influences at work in relation to this loan. I would also like to know why we are committed to support American shipping and American insurance for the purpose of borrowing $5.9m. There is a rumour that Sir Robert Menzies is not unconnected with the Morgan Guaranty Trust Coy of New York which is handling part of the arrangements for this loan, but whether or not he has some connection with it, I think, is well worth looking into. How much are we committed? We are selling our rights under this agreement for the purpose of getting $5. 9m, which is not beyond the capacity of this Commonwealth to supply. We are agreed - I think the speeches of Government supporters admitted this - that the airlines policy is carried out with the assistance of foreign loans. We say that the Australian taxpayer should not have to finance these. Should the Australian taxpayer forfeit the right to other business which goes with the carrying on of airlines and with borrowing? We are selling out to American interests - possible because of political influence - on this occasion for the purpose of borrowing a sum which it is quite within the capabilities of this Commonwealth to provide.

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I want to say just one thing in the hope that we may secure the passage of this legislation. Those two provisions have been in all the loans we have received from the Export-Import Bank since the first loan for Qantas Empire Airways Ltd in 1960 which was raised at 51%.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

Bill (on motion by Senator Anderson) read a third time.

page 2395

ADJOURNMENT

Postal Department - Electoral - Planting of Native Trees in Canberra - Bureau of Mineral Resources

The PRESIDENT:

– Order! In conformity with the sessional order relating to the adjournment of the Senate, 1 formally put the question:

That the Senate do now adjourn.

Senator WILKINSON:
Western Australia

– As an ex-employee of the Postmaster-General’s Department I want to take the opportunity to express some concern at what I consider to be unfortunate developments which have taken place in the telecommunication field. I hope that the Minister for Housing (Senator Dame Annabelle Rankin), who represents the Postmaster-General (Mr Hulme) in this chamber, will convey my thoughts to the Minister. It is rather surprising that so much has happened today. This afternoon’s copy of the Sydney ‘Sun’ carries a news item which comes from Canberra and which States that many people have queried their new telephone bills. The report states that there has been an upsurge in the number of telephone subscribers questioning their bills since the introduction of subscriber trunk dialling. The report adds that all claim that they have been overcharged. Honourable senator will recall that last year in the debate on the Estimates I mentioned my concern at the way in which subscriber trunk dialling was being introduced wholesale in Australia and I asked who actually wanted it. Senator Morris asked: ‘Do you not think it is a good idea?’ Because it happens to be handy for members of Parliament to be able to dial their constituencies and it is handy to honourable senators to be able to call their home State and to get on with their business very rapidly, this does not necessarily mean that it is a good thing. I was disturbed about the way that it was being introduced wholesale without there being a significant demand for it by the public. The reaction which we now get is much as I anticipated.

I should like to refer also to today’s ‘West Australian’ in which there is a report of an interview with the Director of Posts and Telegraphs in Western Australia, Mr White. Under the heading ‘Waiting for a Phone* the report states that fourteen of the metropolitan area’s thirty-two telephone exchanges are closed because they cannot provide one new telephone line to the areas they serve. The word ‘closed’ appears in quotation marks. This does not mean that the exchanges are not operating; it means that they cannot take any additional subscribers. This is due to the tremendous development that is taking place in Western Australia. In that State there are now 3,932 deferred applications. In this respect Western Australia is second to New South Wales which has a larger number of deferred applications. This shows two things that are disturbing.

I pass on now to the situation in Western Australia where the Post Office is amalgamating exchanges. Apparently this is now the trend throughout the Commonwealth. I assume that the intention is to operate at a more efficient level of cost, but so far as I am concerned this system does not provide a more efficient service. On 28th October the same Director of Posts and Telegraphs, Mr White, wrote to the Secretary of the Postal Telecommunication* Technicians Association and stated that there would be a change in the operation of a number of exchanges, that they would be amalgamated and that the amalgamation would take effect from 31st October. Three days notice was given of a tremendous change that would occur in the operation of these exchanges in Western Australia. Those mentioned by Mr White were Quairading, Southern Cross and Victoria Park exchanges, all of which are quite large exchanges. I find on investigation that this so concerned the Association that it immediately asked for a stay of proceedings so that it could interview Mr White. The request was granted and on 7th November the Postal Telecommunications Technicians Association flew to Western Australia its Federal Assistant Secretary and Treasurer, Mr McMahon, who led a deputation which was met by the Director of Posts and Telegraphs, the Assistant Director of Engineering, the Superintendent in charge of Administration, the Superintendent of Personnel and the Establishments Officer. That shows how important the Department considered this conference to be.

As a result of the conference Mr White wrote to the Association on 8th November and said that in future the Department would give 3 months’ notice of any impending amalgamations. He said also that on that occasion the Department would extend the time for the amalgamation to take place. He said that action with regard to Quairading, Southern Cross and Victoria Park would be postponed for 2 months to allow the Association to present views for consideration as to why the amalgamation should not take place. Tt seems to be simple enough to say that some exchanges are to be brought together and amalgamated to achieve a more efficient operation so far as costs are concerned, but it does not lend itself to greater efficiency in the operation of the telephone services. I can refer only to the position in Western Australia where an exchange like Tuart Hill, which is a crossbar exchange, has a grade 2 supervising technician in charge of it. That means that it has at least 4,000 subscribers connected to it. But this exchange is being amalgamated with the one at Mount Hawthorn, so there will be nobody at Tuart Hill exchange.

We find also that Scarborough, Ascot, Palmyra, Applecross, Maddington,

Wembley, Manning, Bassendean, Hilton as well as Southern Cross and Quairading, are all going to be affected in the same way. What will be the result of this? Some amalgamations have already taken place and we have found a downgrading of the service. We have found also that the normal acceptable rate of fault has been doubled because there are not the personnel on hand to attend to the exchanges. This situation applies equally to crossbar and step by step exchanges, although the’ step by step exchanges are more vulnerable to faults. The modern exchange uses the crossbar system, but this system is not in use right throughout Australia. I contend that we are making a mistake in replacing personnel at these exchanges and in amalgamating them with larger exchanges.

Let us consider what will happen in Fremantle. Fremantle will look after Spearwood and Hilton, which will give Fremantle 25,000 to 30,000 subscribers. But there will be no personnel at these other exchanges. This will cause a tremendous amount of difficulty because we are not ready for this type of changeover. Another thing which is disturbing the Postal Telecommunications Technicians Association is that there are plenty of men qualified as senior technicians but they are not being appointed to positions and many have been waiting for a couple of years. They are not getting the advances in promotion that they should get and which they would have got had the exchanges not been amalgamated. In the recent notes of the Association there is evidence that the situation is even worse in Queensland. The Association’s journal is extremely critical of the Department’s past and present attitude with regard to technician staffing. The journal states, with regard to Queensland:

Two hundred and twenty technicians are at present qualified as senior technicians and are unable to receive appointments because of the lack of permanent senior technician positions.

This is, I believe, an extremely serious trend that we are seeing in the Post Office at the present time. I request Senator Dame Annabelle Rankin, who represents in this place the Postmaster-General, to bring this matter to his attention. It is disturbing not only the people concerned in Western Australia. I have been in touch with the Federal office of the Association and have been informed that these conditions operate throughout Australia and are downgrading the service to the public.

I refer again to the three points I have raised. The first relates to increased charges as a result of the subscriber trunk dialling system, the second relates to the lag in telephone connections and the third relates to the amalgamation of exchanges. We are now reaching the stage at which we will wake up to find a very much higher incidence of faults. That is not what the public wants. I ask the Postmaster-General to consider the matters I have raised.

Senator MULVIHILL:
New South Wales

– During the debate on the estimates for the Department of the Interior I raised two matters, one relating to the provision of absentee voting facilities in the Richmond electorate in New South Wales and the other relating to that portion of the annual report of the National Capital Development Commission which deals with the type of native trees to be planted in Belconnen and other sections of the Australian Capital Territory. 1 am mindful of the considerable detail that officers of the Department of the Interior have furnished to me, and with the concurrence of honourable senators I incorporate in Hansard a letter dated 26th November 1968 addressed to me by the Minister for the Interior (Mr Nixon) and a list of native plants and trees that have been planted in Belconnen.

Minister for the Interior, Parliament House, Canberra, A.C.T. 2600 26 November 1968 Dear Senator Mulvihill,

I refer to the debate in the Senate on 7 October 1968 on the Department of Interior Estimates of Expenditure for 1968-69 in which you were reported to have stated:

After every Commonwealth election there are many complaints about the apparent lack of planning at the Tweed Heads polling booths. As most honourable senators know - and I think Senator Gair particularly would be aware of what happens in Queensland - a high number of absentee votes are recorded. At the last Federal election there were from 1,200 to 1,400 absentee votes at Tweed Heads. The complaint is that supplies of the absentee voting blanks run out early in the day. People become very sensitive about having to wait in a queue for a long time in order to vote. I suggest that the Divisional Returning Officer for Richmond look into this matter.’

I have had the matter investigated and the Divisional Returning Officer for the Division of Richmond has advised in the following terms:

To my knowledge the polling place at Tweed Heads or any other polling place within the Tweed Subdivision has never been required to obtain further Absent ballot-papers or Absent Vote Declaration envelopes at a Commonwealth Election.

The Assistant Returning Officer at Tweed Heads polling place has presided in this area for many years and is a most conscientious officer in whom I have every confidence as being capable of planning very satisfactory polling arrangements.

To substantiate my statement on the plentiful supply of ballot-papers I offer the following statistics for your perusal.

In addition to the above ballot-papers a further supply of printed Absent House of Representatives ballot-papers (25 for each Division) is issued to Tweed Heads polling place to assist in the prevention of delays.

The staffing of the polling place was seven tables in 1964 and since that election it has been increased to nine tables soI believe adequate staff has been provided.’

The Chief Electoral Officer has reported that there does not appear to have been any shortage of ballot-papers at the Tweed Heads polling place in recent years but it is just possible that your complaint could relate to the State elections held on 24 February1968.

Yours sincerely, (Sgd) PETER NIXON

Senator LITTLE:
Victoria

– Being a newer member of the Senate, on 23rd October last in my enthusiasm I proposed to ask a question without notice of the Minister representing the Minister for Trade and Industry. I listened to your good counsel, Mr President, that any question which required information of a statistical nature should be placed on notice to give the Minister a better chance to answer it. On your advice I placed the following question on the notice paper:

  1. What is the amount of tariff protection on money value basis afforded individual secondary industries in Australia?
  2. What is the estimated total tariff protection money value afforded all Australian secondary industry?

I agreed with you that the information I sought at the behest of people in the State that 1 represent in the Senate was of a highly statistical nature and I thought it was much fairer to give the Minister an opportunity to reply by giving notice of the question. Today I received a reply from the Minister for Trade and Industry (Mr McEwen). He must have either a computer or an old-fashioned crystal ball because he seemed to know why I wanted this information. He did not reply to the question. This is what he said: lt is not practicable and can be misleading to try and measure the effects of tariff protection in this way. The purpose of the Tariff is to encourage the development of worthwhile Australian industries. The effect it has in this way on Australia’s economic development and employment opportunities cannot be measured in money terms.

I am at a complete loss to understand this homily which the Minister, after one month of deep consideration, has produced in answer to a question seeking specific information on behalf of electors in the State of Victoria. If this question had been asked without notice it may have been unfair to the Minister; so I gave notice and that is the answer I received. If anyone can make sense out of it - even the Minister concerned - I would appreciate its being explained to me so that I can explain it to the constituents who want the information. I do not know why they should be read a homily in the terms of the reply that I received when all they want are the precise figures involved in this matter.

If we place questions on the notice paper to be fair to the Minister, I think that the Minister at least should be fair to the Senate, to honourable senators and to the electors they represent and should produce the information that is sought, not a homily of this character that presupposes the reasons for which the information was sought and then states that the presupposed reasons are not practical and therefore an answer will not be supplied. If anyone can place any other interpretation on this I will listen, because I am a patient man. This House should not adjourn until such time as I am given a reasonable reply to the question I asked on notice over a month ago. The information I received today is an insult to the intelligence of this Senate.

Senator GEORGES:
Queensland

– ‘During the debate on the estimates for the Department of National Development I asked the following questions:

How much research is being carried out by the Bureau of Mineral Resources on leases controlled by private firms? How much is the Bureau receiving in return for supplying expert advice. How often do our surveyors and explorers find mineral deposits? How often is that information passed on to private enterprise for exploitation? What does the Bureau receive in return?

I have since received a rather comprehensive reply from the Minister for Customs and Excise (Senator Scott), who represents in this place the Minister for National Development (Mr Fairbairn). With the concurrence of honourable senators T incorporate the information in Hansard.

The Bureau of Mineral Resources does not carry out prospecting operations on mineral leases controlled by private firms. It is not a prospecting organisation and its fundamental role in mineral exploration is the provision of basic data through geological, geophysical and other surveys. From this basic data theories are developed concerning the origin of and the processes that have affected the condition and arrangement of materials through geological times. The data provide the basis for elaborating facts and deducing theories or concrete guides as to what useful minerals might be found and with which rocks and structures they are likely to be associated. Regional geological and geophysical mapping tends to outline areas which have the best prospects for further mineral discoveries. This enables individuals or companies to direct their search to the most promising areas and permits more effective exploration of the ore deposits through a better understanding of the geological factors that control their deposition.

The mineral exploration companies draw heavily on the Bureau’s published and unpublished data in planning and executing their exploration programmes. The Bureau also conducts experimental surveys with new techniques or in the application of established techniques to a new range of conditions. During 1968 the Bureau’s regional geological and geophysical surveys in Australia and its

Territories will cover several areas totalling approximately450,000 square miles, many of which embrace mineral fields which are being actively prospected by private firms. It would be a task of great magnitude to attempt to define the numerous mineral leases or other mineral tenements included in these areas.

During the course of itsregional surveys the Bureau’s officers do from time to time discover mineral deposits, but such discoveries are coincidental to the true purpose of the surveys. Special efforts are made to ensure that these discoveries are announced in such a way that the results are available simultaneously to the Mineral Industry as a whole and the full investigation of the deposits is left to the mineral exploration companies. If the Bureau should discover a mineral deposit on a tenement held by an exploration company there is no provision for any payment to the Commonwealth by the tenement holder. If a mineral discovery is made on lands reserved to the Crown the Government may invite tenders for the right to test, develop and exploit the deposit. This was done in the case of the Woodcutters prospect near Rum Jungle, Northern Territory, which was discovered by a Bureau party while making details surveys on behalf of the Australian Atomic Energy Commission.

The reply of the Minister for National Development to question upon notice No. 600 on page 2393 of the House of Representatives Hansard of 24th October 1968, has some relevance to this matter. The reply of the Minister for Education and Science to question upon notice No. 122 in the Senate Hansard of 14th August 1968 has some relevance to the mention of Mr Newnham’s statement on the number of geologists graduating in recent years. This answer indicates that 171 persons graduated in geology in 1967 against the figure of 91 quoted by Mr Newnham.

The Commonwealth Government has already introduced a system of controls covering the export of uranium from Australia to ensure that adequate supplies are retained in this country. Insofar as uranium exploration funds provided to the Bureau of Mineral Resources by this Commission are concerned, no work is carried out by Bureau on private leases.

Senator BYRNE:
Queensland

– 1 think that the matter raised by my colleague, Senator Little, is of some considerable importance to the Senate. The questions to which he has referred were not directed to the Minister in this place in his own capacity but in his capacity as the representative of the Minister for Trade and Industry (Mr McEwen).I doubt whether a Minister in this Senate answering a question that came within the ambit of his own portfolio would have ventured to give the kind of answer that came finally from a Minister in another place. That is why I think this is of serious significance. It is certainly not the province of a Minister, in replying to a question directed to a Minister in this chamber, to try to interpret the motives which inspired the senator to ask the question. Senator Little asked this question for a purpose that is not altogether discoverable but obviously it was in the interests of his electors and for good and sufficient reasons. In the last sentence of the prepared reply the Minister for Trade and Industry said:

The effect it has in this way on Australia’s economic development and employment opportunities cannot be measured in money terms.

That may well have been the proposition that Senator Little wanted to establish but he could discover it only by ascertaining the moneyvalue of the tariff protection and whether that, related to and equated with the economic advantages, made it in or out of proportion. But it is not for the Minister to try to discover what case an honourable senator is trying to make and to give him an answer accordingly.If that were the case there would be a frustration of the traditional practice of directing questions to Ministers.

I think that the Senate tonight, in a rather formal manner, should note with some concern that an answer of this kind has been presented by a Minister in the House of Representatives through a Minister sitting in this place. We can only trust that in future senators will be supplied with information, if it is available, in the terms of the question and not in the terms of the interpretation which the Minister may choose to put on the motives which, in the imagination of the Minister, may have prompted the honourable senator to ask the question. I am sure such an answer wouldnot have been forthcoming from a Minister sitting in this place.

Senator Dame ANNABELLE RANKIN:
Minister for Housing · Queensland · LP

[10.49] - I have noted with interest the three points Senator Wilkinson raised, his explanation concerning them and his concern about them.I shall place those matters before my colleague, the Postmaster-General (Mr Hulme). whom I represent in this place.

Question resolved in the affirmative.

Senate adjourned at 10.50 p.m.

Cite as: Australia, Senate, Debates, 26 November 1968, viewed 22 October 2017, <http://historichansard.net/senate/1968/19681126_senate_26_s39/>.

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