Senate
6 October 1977

30th Parliament · 2nd Session

  1. Senate
  2. 30th Parliament
  3. 1977

The PRESIDENT (Senator the Hon. Condor Laucke) took the chair at 1 1 a.m., and read prayers.

page 1143

QUESTION

QUESTIONS WITHOUT NOTICE

page 1143

QUESTION

SMALL BUSINESSES: INABILITY TO OBTAIN BANK FINANCE

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-My question, which is directed to the Minister for Industry and Commerce, relates to a question which was asked by my colleague, Senator McLaren, yesterday. I ask the Minister: Will he agree that the most pressing problem affecting small businesses today is their inability to obtain finance through the banks with the result that they must approach non-bank financial institutions to obtain funds and thus are burdened with interest rates for such finance which are up to 70 per cent higher than bank rates? In the light of the fact that 12,000 small businesses are failing annually, can the Minister advise what have been the achievements to date of the Small Business Unit which was set up in his Department and which is referred to on page 27 of the White Paper on Manufacturing Industry?

Senator COTTON:
Minister for Industry and Commerce · NEW SOUTH WALES · LP

-No doubt obtaining finance is a problem for small businesses. I think small businesses have a more difficult job in obtaining finance than large corporations. Small businesses claim to have great difficulty in getting finance from the banks. When the banks are asked questions about this- and they have been- they deny that this is the fact. They say it is not true. They produce evidence to prove that it is not true. A lot of work has been done on this aspect. It is not just an isolated matter. Nonetheless I have had the view that it is more difficult for sole traders and small business corporations to obtain finance than it is for large corporations. It is a view I still hold. Accordingly I have been working quite steadily to try to get a resolution of this problem. I believe that I am getting close to it. When I get to the point that I can speak positively about this matter I certainly will do so.

For many reasons, I do understand the problems. I came out of the small business world myself. I am familiar with the problems. I am full of understanding and sympathy for small businesses. A lot of their problems came out of the very recessed position of earlier years. I think we all know that. Their problems also came out of the difficulties they had in loss of competitive efficiency. I think we all know that. The Department has helped them a great deal with the provision of advice, booklets and counselling. It has helped them in various areas because of its ability to provide extra knowledge. The Department recently appointed its Director of the Bureau of Industry Economics, Professor Brian Johns. I think most people agree that he is one of the Australian experts on the small business world. He has done a lot of work recently which I think will be of great value to the small business world. I do not think I can say a great deal more than that except that I really do not think that some of the assumptions that are made by the honourable senator about interest rate charge increases are very accurate. If the honourable senator has specific cases of that happening in the normal banking structure I would like to have them. I shall certainly direct the attention of myself, the Department and the Government to such instances.

page 1143

QUESTION

WOMEN’S REFUGES AND HEALTH CENTRES

Senator BAUME:
NEW SOUTH WALES

– Is the Minister for Social Security in a position to comment on the criticisms made by the Archbishop of Sydney, Sir Marcus Loane, on the funding and operation of women ‘s refuges and health centres in Sydney?

Senator GUILFOYLE:
Minister for Social Security · VICTORIA · LP

– I am aware that my colleague, the Minister for Health, had drawn to his attention the reported criticism of the Archbishop of Sydney regarding the funding of women’s refuges. I asked him for his response to the remarks that had been reported. The Minister for Health said that in considering this reported criticism by the Anglican Archbishop it is important to distinguish between the services which are provided by the women’s refuges and the individual philosophies of some groups which support the need for such centres. There can be no doubt that the philosophies of some of the centres and of some of the publications issued at some of the centres are contrary to the attitudes and philosophies of this Government. However, that does not appear to be sufficient justification for disregarding the services which are provided to women in crisis and emergency situations.

Basically, the centres have received financial support in recognition of an assertion that the existing system of health care is not entirely adequate to meet all the special health care needs of women. Furthermore, the rate at which the centres are being utilised by women seems to provide clear confirmation of the need. The Minister for Health stresses that the centres operate in general under the supervision of the State health authorities through which Commonwealth funds are channelled. Of course, the State governments in most instances also contribute funds to them. It is important to note that Commonwealth assistance for the centres has been based on the acceptance of the need for them both by the present and former State governments of New South Wales. If any specific allegations concerning the misuse of public moneys were made, the Minister for Health would be pleased to have any investigation made that might seem appropriate. But he stresses that the services which have been provided are meeting a need that appears not to be covered in any other way by any other service.

page 1144

QUESTION

FEDERAL INTERVENTION IN VICTORIAN POWER DISPUTE

Senator BUTTON:
VICTORIA

-I direct a question to the Minister representing the Minister for Employment and Industrial Relations. I refer to an interview on the AM program this morning with the Minister for Employment and Industrial Relations, Mr Street, when he was asked a number of questions relating to the power industry dispute in Victoria. In the course of that interview the Minister was asked:

How will Federal Government intervention in the case before the Full Bench of the Conciliation and Arbitration Commission assist with the settlement of this dispute?

The Minister replied:

It will make clear to the community the Government’s attitude in this matter.

I draw the attention of the Minister to the fact that there is a distinction between political attitudinising and effective government action. I ask the Minister: What is the answer to the question which was addressed to Mr Street, namely, how will the Government’s intervention assist in the settlement of this dispute?

Senator DURACK:
Attorney-General · WESTERN AUSTRALIA · LP

-This dispute arises under Federal jurisdiction. It is a Federal award. The matter has come before the Federal Conciliation and Arbitration Commission. It is a dispute of great magnitude and great concern not only in Victoria. Clearly, the effects of the dispute are spreading beyond Victoria. Therefore, it is a matter of national significance. I would have thought that anyone but Senator Button would have seen clearly the responsibility of the Federal Government in this matter and the need for it to intervene, to take an active interest in the dispute and to give support to the Victorian Government in the actions it is taking.

Senator BUTTON:

-Mr President, I wish to direct a supplementary question to the Minister. What is the purpose of the Federal Government’s intervention in settling this dispute?

Senator DURACK:

-Mr President, it is clear that Senator Button is the only person in this chamber and in this country who cannot see the purpose by now.

page 1144

QUESTION

EDUCATION FUNDING

Senator LAJOVIC:
NEW SOUTH WALES

-I ask the Minister for Education: Has the Minister’s attention been drawn to a column in yesterday’s Sydney Daily Mirror by a State political reporter, Dennis Ringrose, entitled ‘Education a Poor Relation?”? Does Mr Ringrose say in his report that ‘Education is fast becoming the poor relation of the Wran Government’s many financial responsibilities’? Will the Minister give the Senate his views on the very real threat which cutbacks in the Wran Government’s spending on education pose for the children of New South Wales?

The PRESIDENT:

– I take it that the question is seeking not an opinion but facts by way of information. I call on the Minister to answer the question.

Senator CARRICK:
Minister Assisting the Prime Minister in Federal Affairs · NEW SOUTH WALES · LP

– I have in front of me a copy of the report. The Senate will have noted in the past that the Labor Opposition was very irritated when Government Ministers were unable to say that they had seen items in the Press. I have seen this item and am able to respond to it. It is an item which is headed ‘Education a Poor Relation?’, and suggests that the Wran Government is making it a poor relation. The simple fact is that the decisions of the Wran Government are decisions that it must make itself politically, in terms of value judgments as to how high or otherwise it regards education in its spectrum. It has the money to increase the programs of education if it so desires. If it elects not to do so, it must take that responsibility. For example, the Wran Government recently has issued a capital works program increasing the money for capital works by 18 per cent compared to the previous year. Therefore, in very real terms, it is showing its ability to increase the allocation for capital works. My understanding is that education represents, in capital works, only some 8 per cent and, therefore, is a poor relation in every sense. I remind the Senate that the Wran Government was elected on the promise that it would employ all unemployed teachers. I think honourable senators will find from newspaper reports that it has failed to do so. I simply indicate that all proof by way of surplus budgets and money available is before the people to show that if the Wran

Government wants to face up to education it can do so. If it does not, it demonstrates what a low priority it holds for education.

page 1145

QUESTION

EDUCATION FUNDING

Senator WRIEDT:
TASMANIA

– My question is directed to the Minister for Education and relates to the question he has just attempted to answer. I ask: Is it not true that not only New South Wales but also every State of the Commonwealth is finding it increasingly difficult to meet the commitments of State governments because of the reduction in the increase of Commonwealth finance for all State governments, including New South Wales? Is it not a fact that the Schools Commission itself in respect of education alone has indicated that it will not be possible for State governmnents to maintain the level of commitment to education as they have done in the past? I ask the Minister: Is it not also true that total payments to New South Wales in this Budget will increase by a percentage of 12.8, compared to only 6.2 per cent last year under the first Budget of the Liberal Government and compared to 33 per cent in the last Budget of the Labor Government? Is he asserting that with the continual decline in payments to the States under the new federalism policy of this Government, those State governments can maintain the services without that additional finance?

Senator CARRICK:
LP

-Everything that Senator Wriedt has alleged is, of course, against the evidence before the people of Australia and this Senate.

Senator Wriedt:

– Those figures are from the Budget Papers. Why do you not ask Mr Lynch about them?

Senator CARRICK:

-I do not mind if Senator Wriedt wants to interject. He can continue to his heart’s content. His track record on this matter is not all that good. The simple fact is that what he is trying to say is that the States cannot perform because they do not have the money. I say to him that the overwhelming evidence is that if all States in the first year of the Fraser Government could balance their Budgets and cut taxes then they had more money than necessary to carry out education programs. That is in negation of what Senator Wriedt was trying to say. Equally, I think that four State budgets have been brought down this year and all States have substantially balanced their budgets and all have cut taxes further. So it is quite clearly demonstrable that they have not only the money but also the surplus capacity to perform if they want to do so. How Senator Wriedt could so misrepresent what the Schools Commission has said defies my understanding. I can only think, with the best of good will, that he has read the report superficially and reached conclusions which are utterly wrong. The Schools Commission did not reach a conclusion at all that the States would not be able to meet their commitments. It said that the evidence of the past was that the States would be able not only to maintain their efforts but also to improve them, as they had done in the past; but it felt it could not use that as a basis for reaching conclusions in the future. In fact it was wrong because the basis for the future proved it wrong.

I want to remind Senator Wriedt and the Senate of what the Schools Commission said. It said that quite above being able to maintain their effort, which was what the Schools Commission had hoped, the States had been able to improve their efforts and, as a result, not only would they reach the Schools Commission targets but also they would surpass them years ahead. The Schools Commission said that in the first year of the Fraser Government the States were able to increase by one per cent the percentage that education occupied of total State budgets, and that meant literally tens of millions of dollars more for education. What Senator Wriedt has said is simply not true and is in defiance of the facts. The money that has been available to the States, both by their own efforts and by Federal funding, and also to local government, has been sufficient to enable them to perform in the way that both their own budgets and the Schools Commission have been able to reveal.

Senator WRIEDT:

-I ask a supplementary question of the Minister for Education. It is important to note that Senator Carrick never picks up the Schools Commission’s reports and quotes from them. It is all off the top of his head. I will quote from paragraph 3.12 at page 10 of the Commission’s report and ask the Minister whether or not it is true. The Commission stated:

The Commission accepts the financial implications of the scheme for 1978 but is concerned at its future implications if there is to be insufficient growth in total funds.

Does the Minister not read that as indicating that the Commission is concerned with the insufficiency of total funds?

Senator Sir Magnus Cormack:

- Mr President, I raise a point of order. The Standing Orders are quite clear on this matter. I say with great respect to you, Sir, that at the present moment Question Time has ceased to be a time when questions without notice are asked, and questions are being debated in the form of asking the questions or responding to them.

Senator Wriedt:

-If I may speak to the point of order, Mr President, I accept the point of order made by Senator Sir Magnus Cormack, but I put this to you: What brings this situation about at Question Time? A whole series of Dorothy Dixers are served up to Government Ministers for no purpose other than to gain a little bit of political capital at Question Time. If Government Ministers imagine that that procedure is going to be allowed to continue without the Opposition responding in the same way they have another think coming.

The PRESIDENT:

-Standing Orders clearly provide that debate should not occur at Question Time. I ask Senator Carrick to bear that in mind.

Senator CARRICK:

-I respond to the Dorothy Dixer asked of me by Senator Wriedt. He said that I will not quote from the Schools Commission report. I now quote from that report:

States have continued to improve their own allocations for recurrent purposes in recent years . . .

In other words, the Schools Commission report said what I said it said- that the States have gone beyond their maintenance of effort. They have improved their efforts beyond maintenance of effort and have been able to do so because of the availability of funding to them from general revenue grants. Therefore what Senator Wriedt said, Dorothy Dix or otherwise, is utterly wrong.

page 1146

QUESTION

HOBART BRIDGE

Senator WRIGHT:
TASMANIA

-I direct a question to the Minister representing the Minister for Transport. In recent days I have indicated an interest in the cost to the Commonwealth of the reconstruction of the Hoban bridge and the associated services. Has the Minister been able to get together those figures for the information of the Senate?

Senator CARRICK:
LP

-Senator Wright was good enough to indicate to me that, as the reopening of the bridge is imminent and as it is a matter of public importance, this information ought to be made available. The information in itself is available in some detail in Budget Paper No. 7, particularly on pages 74 and 75, but I indicate that the Commonwealth Government agreed to reimburse the State for the full amounts of expenditure incurred by it and its authorities, subject of course to their being relevant. That included expenditure on not only the restoration of the bridge but also a number of other functions. For the information of honourable senators I shall read the running total so far of the State expenditure eligible for reimbursement. It reads: Restoration of the Tasman Bridge, $16.5 12m; widening of the bridge, $5. 183m; temporary bridge, $3.966m; government services on the eastern shore, $ 1.469m; roads, $9.496m; other transport services and facilities, $6.3 1 lm; others, $5 13,000. That makes a total so far from the State of $43,450,000. The payments by the Commonwealth to the State, including an estimate for this year, amount to $43,800,000. 1 seek leave to have the table incorporated in Hansard. In so doing I ask that my own addition and extension of the columns be included in the table.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

The table read as follows-

TABLE 53-GRANTS FOR TASMAN BRIDGE DISASTER

($ thousands)

  1. Comprises capital expenditure on ferry and bus terminals, the operating costs of landing barges provided by the Defence Force and assistance for the operation of ferry and additional bus services.
  2. Includes assistance for original investigations of proposal for second bridge across the Derwent River and other miscellaneous items, including emergency expenditures.
  3. Differs from State expenditure because of ‘leads and lags’ and unavoidable estimating errors involved in payment arrangements.

page 1147

QUESTION

SOLAR ENERGY

Senator KEEFFE:
QUEENSLAND

-I direct a question to the Minister for Science. His previous replies to questions on this subject have been rather confusing, so I am trying to get some additional information. Did the Minister state in his answer to Senate question on notice No. 860:

Solar energy research being carried out in Australia is clearly of concern to me and other Ministers.

If so, how does the Minister explain his answer to Senate question on notice No. 678? There he stated in reply to a question dealing with the manufacture and installation of solar hot water heaters which have been developed by the Commonwealth Scientific and Industrial Research Organisation:

This is not a question which falls within my specific responsibility.

Senator WEBSTER:
Minister for Science · VICTORIA · NCP/NP

– I assure honourable senators that the question is very confusing to me. I am unable to recall the precise details of question on notice No. 860. 1 regret that I am unable to recall the details of question on notice No. 678. 1 do recall a question being asked at an Estimates Committee meeting relating to solar hot water heaters. It was raised by an honourable senator from the Northern Territory. I regret that I am unable to add to the information that has been given at the moment.

page 1147

QUESTION

ENERGY PROGRAM IN THE UNITED KINGDOM

Senator THOMAS:
WESTERN AUSTRALIA · LP

– I direct a question to the Minister representing the Minister for National Resources or the Minister representing the Minister for Foreign Affairs. Is the Minister aware of the resolution relating to an expanding energy program in the United Kingdom which was recently passed by the United Kingdom Trade Union Congress? Can the Minister inform the Senate of the details of that decision?

Senator WITHERS:
Minister for Administrative Services · WESTERN AUSTRALIA · LP

– Honourable senators may know that at a meeting of the United Kingdom Trade Union Congress on 8 September of this year the following resolution was passed:

Congress supports the balanced development of the country s energy resources, including coal, gas and nuclear, but is concerned at the increasing rate of consumption of the currently limited stock of the world’s energy resources. While welcoming the current efforts of the Government to devise an overall energy strategy, Congress is nevertheless concerned by the failure of the Secretary of State for Energy to tell the British people of the grave energy problems which both Britain and Europe face in the clearly foreseeable future. Congress instructs the General Council to press the Government to formulate a plan for energy which will not leave us dependent upon as yet unproved or undeveloped sources of energy beyond the 1980 ‘s and which will ensure that the urgent decisions which need to be taken to avoid any threat to economic expansion and standards of living are no longer unnecessarily delayed. This should include the following objectives:

To promote an effective energy conservation program. All Government policy statements and consultative documents should contain details of their energy demands and how these fit in with the overall energy strategy.

To maximise the contribution of an expanded and socially acceptable nuclear program which is consistent with the maintenance of a safe environment in terms of solving problems of health and security which may arise.

Senator Georges:

– They are just a bunch of Pommie stirrers.

Senator WITHERS:

-I hope Senator Georges’ brethren in the United Kingdom will take that remark to hean. I think Mr Grassby will have something to say about it. In view of the criticism levelled recently I am surprised that Senator Mulvihill does not take exception. The resolution continues:

  1. Congress supports the construction of a full scale demonstration fast breeder reactor and further declares its support for the development of reprocessing facilities at wind scale, both as an integral part of our own nuclear program and as a significant export of advanced technology, provided that major decisions in the nuclear program are the subject of realistic and informed research and debate on all the issues.
  2. Much greater investment in research programs so that other sources of non-nuclear energy (solar, tidal, wind, et cetera) can be developed.
  3. To secure the prudent use of this country’s vitally important and substantial stocks of coal.
  4. To provide full opportunities for British industry in both the domestic and overseas markets.
  5. To plan prices so as to allocate consumption in line with the agreed aims and intentions of the energy policy rather than as a short-term expedient.
  6. To ensure that the British Gas Corporation and the British National Oil Corporation have effective control over the overall depletion rate of North Sea oil and gas reserves.

I must say that the enlightened attitude of the United Kingdom Trade Union Congress stands in stark contrast to that adopted by their socialist brothers in this country.

Senator Button:

– They have a Labor Government.

Senator WITHERS:

-As Senator Button reminds me, there is a Labor Government in the United Kingdom- a government which, as I understand it, is expanding its nuclear power stations. It believes in the use of nuclear energy. Again that stands in stark contrast to their socialist brethren in this country. I once thought that the socialist parties of the world believed in some sort of brotherhood of man. It is rather interesting that all their socialist brethren east of the Iron

Curtain are very keen on the production, implementation and use of nuclear power. So are their socialist brethren in the United Kingdom.

Senator Georges:

-They are right, are they?

Senator Walsh:

– You, Court, and the commissars in the Kremlin.

Senator WITHERS:

-Senator Georges and Senator Walsh are now saying that their socialist brethren overseas are all wrong. I would have thought that what it does point out is that when their socialist brethren overseas have enough intelligence to come to government they make the right decisions. In view of the decisions that the socialists made on nuclear energy in this country it is no wonder they are in opposition here.

Senator Cavanagh:

- Mr President, I take a point of order. I ask the Minister to table the document concerning the meeting of the United Kingdom Trade Union Congress from which he read, for the purpose of showing the source of his information.

Senator WITHERS:

-I will table it willingly. I have just given it to Hansard for incorporation, but on the understanding that it goes to Hansard so that it can reproduce properly what I have said, I am quite delighted to table it. Would Senator Cavanagh like to see it?

Senator Cavanagh:

– I will see it later.

page 1148

QUESTION

FEDERAL INTERVENTION IN VICTORIAN POWER DISPUTE

Senator BISHOP:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Employment and Industrial Relations. It follows upon the answer he gave to Senator Button a few moments ago. My question is intended to get the Government in the Senate, if possible, to clarify why it has decided to intervene before the Full Bench of the Australian Conciliation and Arbitration Commission in respect of the Victorian State Electricity Commission strike. I also draw to the Minister’s attention the fact- no doubt he is aware of it from this morning’s newspapersthat despite the general concern expressed by the Australian newspapers today there is also a sharpened reaction to any form of brinkmanship by the Government. Can the Minister advise the Senate whether the Victorian Government requested the Federal Government to intervene? In respect of its intervention, is the Government to take a line which would help the conciliatory procedures of the Arbitration Commission in all its activities, or is its intervention intended merely as a stiffening of an attitude towards the very serious dispute that may become worse unless the matters are arbitrated and agreed to by the respective parties? As the Government has announced what it intends to do in view of the general gravity of the situation, can the Minister reassure the Senate that the Government’s intervention, in fact, is a conciliatory move and not, as some newspapers are suggesting, a tough move to prevent what might be a reasonable settlement of the dispute?

Senator DURACK:
LP

– This question is rather strange in view of the attitude which the union leadership has adopted in regard to this dispute because it has been a defiant and an intransigent attitude which has led to the sorry state in Victoria at the present time. However, it has always been the Government’s policy to support the conciliation procedures of the Arbitration Commission. I have no doubt whatsoever that the Government will be playing its role in the Commission with a view to endeavouring to settle the dispute. That is why we have the Conciliation and Arbitration Commission. At the same time, the Government has to face the facts of the situation as they are. It has to face the facts that large claims and demands are being made well beyond the indexation policies and guidelines that have been laid down. Naturally, there are many considerations which the Government has to take into account in intervention in a decision of this kind. However, in view of the great interest that has been shown by honourable senators in this matter I will refer the question to the Minister for Employment and Industrial Relations and ask him whether he would be prepared to clarify the matter even further for members of the Opposition.

Senator BISHOP:

-Mr President, I have a supplementary question. There is one aspect to which the Minister did not refer. I asked him whether the intervention was at the request of the Victorian Government or the action of the Federal Government itself.

Senator DURACK:

-I will refer that to the Minister for Employment and Industrial Relations.

page 1148

QUESTION

HOBART-SYDNEY AIR SERVICE

Senator TOWNLEY:
TASMANIA

– I preface my question to the Minister representing the Minister for Transport by saying that no doubt the Minister has seen that soon Air Express is to start a direct Hobart to Sydney and return air freight service. I believe that will start within the next few weeks. In view of the current increase in air passenger numbers, which I think are running at a 9 per cent or 10 per cent increase annually, will the

Minister ask the airlines to examine the possibility of direct Hobart to Sydney and Sydney to Hobart passenger nights? Will he also ask that the cost of such flights be based upon direct distance and flying time rather than the addition of simply the cost of the Hobart to Melbourne plus the Melbourne to Sydney segments as is presently the case? Many people at the moment not only have to travel through Melbourne Airport when they do not want to, but also are charged extra for doing it.

Senator CARRICK:
LP

– I have seen reports of the new air freight service to Tasmania. I am aware of Senator Townley ‘s continued interest in providing an effective and cheap passenger service to and from Tasmania and directly from Hobart. I will direct the questions to the Minister for Transport and ask him to give them consideration and to convey them to the airlines to ascertain whether the suggestion in them can be accepted.

page 1149

QUESTION

AUSTRALIAN WOOL CORPORATION

Senator GIETZELT:
NEW SOUTH WALES

– My question is directed to the Minister for Industry and Commerce in both his capacity as Minister representing the Acting Treasurer and as Minister representing the Minister for Primary Industry. I ask him: Is it a fact that the Australian Wool Corporation is currently experiencing difficulty in funding the wool support scheme? Have steps been taken to augment the Corporation’s funds by approaching the private banks for carry-on finance?

Senator COTTON:
LP

-I think that the Australian Wool Corporation has been buying in quite a lot of wool. I would be very surprised indeed if it is having difficulty in funding its position. It has never had difficulty in the past. I will be with members of the Corporation tonight and I shall ask them directly.

page 1149

QUESTION

TORNADO DAMAGE IN MILDURA

Senator TEHAN:
VICTORIA · NCP

– My question is directed to the Minister for Science. I refer to the tragic losses suffered by Mildura district fruitgrowers in Tuesday’s tornado. Can the Minister say whether the Bureau of Meteorology has facilities to forecast tornados? If not, are any studies being made towards advancing forecasting technology so that localised warnings of destructive storms can be given?

Senator WEBSTER:
NCP/NP

– I recognise the honourable senator’s interest in the latest disaster that has taken place within his State. He will be interested to know that a meteorologist from the Bureau of Meteorology is currently on the spot carrying out an analysis of the storm damage to ascertain the path taken by the tornado and to arrive at an estimate of the wind speeds that were involved. That will assist in understanding these storms which are extremely difficult to predict. There is little precision in predictions because of the very nature of the storms’ localised action, their short life span and their very erratic movements. I understand that in the United States in the Mississippi Valley, an area which is particularly prone to severe storms of this kind, because of the dense population in that area and perhaps because that country has more funds than we have, the meteorological authorities are able to operate a very sophisticated system of weather radars and other ground observation stations supported by photographs from geostationary satellites which they have. In Australia severe storms are reported infrequently but are thought to occur over a very wide area, and because of our comparatively sparse population it is impossible to establish in Australia the system that operates in the United States.

In Mildura a weather observation station is operated by the Bureau of Meteorology. It gives surface observations and the radar installation gives some indication of the upper wind effects. This information is used by the Victorian Regional Forecasting Office in Melbourne to prepare forecasts for the area, and whilst the occurrence of thunderstorms can be predicted with some confidence- and they were forecast in the 11.15 a.m. issue of the Mallee forecast on 4 October- it is impossible to predict the exact location, the time of occurrence and the severity of local severe storms. It will be of interest to the Senate to know that my Department is proposing to send an officer of the Bureau to the United States to attend a conference later this month on severe local storms, and the knowledge he gains from this visit will be valuable in adding to our understanding of this type of storm.

page 1149

QUESTION

POVERTY IN AUSTRALIA

Senator GRIMES:
NEW SOUTH WALES

-Has the Minister for Social Security seen the figures on the poverty line which were released yesterday, I understand, by Professor Henderson, and in particular the claim that many large families are now falling even further below the poverty line, although the breadwinner is an income earner, and also that large families with children are badly affected? I further ask: Does the Minister have any details of these figures? If the figures are factual, will the Government consider making supplementary payments under the special benefits scheme for the few families experiencing this difficulty, even though the breadwinner is earning an income?

Senator GUILFOYLE:
LP

– The figures referred to by the honourable senator have not been drawn to my attention. I will ensure that an analysis of any new figures produced by Professor Henderson is made and make suitable comment after that consideration. With regard to supplementary payments, the special benefit has never been used as an income supplement for wage earning families but I will give consideration to the matter that has been raised after any investigation of Professor Henderson’s figures has been undertaken.

page 1150

QUESTION

DISCRIMINATION AGAINST ABORIGINES

Senator MISSEN:
VICTORIA

– My question is addressed to the Minister representing the Minister for Aboriginal Affairs. I refer to the report in the Melbourne Age of 26 September 1977 which details the problems being experienced by Aborigines in Queensland, including infringements of basic human rights. Is it true, as alleged in the report, that the Queensland Government is ignoring Federal laws, specifically the Aboriginal and Torres Strait Islanders (Queensland Discriminatory Laws) Act of 1975? Is it also true, as alleged, that it is almost impossible at present for the Aboriginal Legal Service to represent all defendants? Can the Minister assure the Senate that action will be taken to ensure that contravention of Federal laws by the Queensland Government does not continue and that discrimination against Aborigines ceases?

Senator GUILFOYLE:
LP

– I understand from the Minister for Aboriginal Affairs that the Aboriginal and Torres Strait Islanders (Queensland Discriminatory Laws) Act 1975 was enacted to override certain provisions of the laws of Queensland that discriminate against Aboriginal and Torres Strait Islanders. Specifically, the Queensland Aborigines Act 1971-1975 and the Torres Strait Islanders Act 1971-1975 and associated regulations limit the rights and freedoms of Aboriginal and Torres Strait Islanders in Queensland in comparison with those enjoyed by other Australian citizens. These Acts are due to expire shortly and the Queensland Government has established an Aboriginal and Islander Commission to advise it on a number of matters, including what legislation might replace the Acts. The Minister for Aboriginal Affairs is currently conducting correspondence with the Queensland Minister for Aboriginal and Islander Advancement and Fisheries, Mr Wharton, in relation to the discriminatory aspects of Queensland legislation. In particular, the Minister for Aboriginal Affairs has offered to co-operate with the Queensland Minister in the work of the Commission. The Aboriginal and Torres Strait Islanders Legal Service, Queensland, can be consulted by any Aboriginal or Torres Strait Islander who wishes to inquire about his rights or take legal action to enforce his rights under the Aboriginal and Torres Strait Islanders (Queensland Discriminatory Laws) Act. In fact, in two instances where the Service entered defences based on the Act, the prosecutions were withdrawn. With regard to Aboriginal legal aid, the Minister advises that in no year since the establishment of the Aboriginal Legal Service have funds been sufficient to provide representation for all Aboriginals in all courts. The Service therefore provides free legal aid to Aboriginals in selected civil and court proceedings according to its own priorities and within the limits of its Budget allocations.

page 1150

QUESTION

ABORIGINAL LAND RIGHTS

Senator COLEMAN:
WESTERN AUSTRALIA

– I direct a question to the Minister representing the Minister for Aboriginal Affairs. Did the Minister for Aboriginal Affairs, in discussions with the Pitjantjatjara Council at Amata on 3 August, undertake to contact the Premiers of Western Australia and South Australia and invite them to join him in passing legislation to provide for uniform land rights? Has the Minister honoured this undertaking? What reply, if any, has been received from the Premiers? Has the Western Australian Premier, or any person representing his Government, indicated an unwillingness to proceed with land rights legislation which provides mineral rights and royalties for Aboriginals?

Senator GUILFOYLE:
LP

-I am not able to provide information on the several questions that have been raised by Senator Coleman. I will refer them to the Minister for Aboriginal Affairs and see that Senator Coleman is advised accordingly.

page 1150

QUESTION

PENSION INCREASES

Senator CHANEY:
WESTERN AUSTRALIA

– I address my question to the Minister for Social Security. I refer to a report in the Sydney Daily Mirror newspaper of yesterday that the Federal Government plans to scrap its legislation linking pensions to the consumer price index. The article goes on, quite correctly in my view, to say that this development is a major achievement of the Government and one of its proudest reforms. Is there any truth in the report that the Government is planning to scrap the legislation?

Senator GUILFOYLE:
LP

– That newspaper article is without any foundation whatsoever. The Government has a policy to increase pensions and benefits each six months in accordance with the movement in the consumer price index. That policy was put in legislative form and the Government will uphold that legislation. The rise that will fall due at the first pay period in November is the third occasion on which such a six-monthly rise has been given. I assure the honourable senator and the people of Australia that the Government has no intention whatsoever to withdraw from its own policy and its own legislation. Each six months increases in pensions will be made in accordance with upward movements in the Consumer Price Index.

page 1151

QUESTION

DISCRIMINATION AGAINST ABORIGINES

Senator CAVANAGH:

– I direct a question to the Minister for Social Security following the answer given to Senator Missen about observance of law by the Queensland Government. Is not the proposal of the Federal Government, which is entering into agreement with Aboriginal communities to pay a wage which is less than the award wage, in contravention of the Aboriginal and Torres Strait Islanders (Queensland Discriminatory Laws) Act which states that an Aboriginal employed on a settlement must get the same wages as he would get if he were doing the same work off a settlement? Is not the employment scheme in breach of the Federal Act? Is not the Minister in making the arrangement to introduce the scheme at Hopevale in Queensland conspiring with someone at the settlement for the purpose of breaching Commonwealth law? Does not the agreement include a provision that no social security payments will be made to anyone on the settlement? Is this blanket decision in breach of the decision given by the judicial authority in the Karen Green case?

Senator GUILFOYLE:
LP

– The proposals that have been introduced by the Government to provide employment opportunities for Aborigines in no way breach the matters that have been referred to by Senator Cavanagh in the question. For some time several Ministers of this Government have been in consultation with Aboriginal communities to enable work programs to be introduced by the communities and to give the opportunity for Aborigines to work in their own communities. The arrangements were made voluntarily with the Aboriginal communities. There is a voluntary system of employment for Aborigines who live within those communities. Individual Aboriginal communities, including those in the pilot scheme, have actively sought a program of this kind from the Government. It was as a result of the initiative of the communities that we were able to introduce some of these pilot schemes. It has been suggested by some people that these would be in contravention of the United Nations anti-slavery provisions. A whole range of assertions has been made. All of our advice is that the schemes do not contravene any of the United Nations provisions nor do they contravene any of our own provisions with regard to unemployment benefits. If individual Aborigines wish to avail themselves of unemployment benefits, they may do so by seeking work outside of these communities, but if they wish to be part of the schemes that have been introduced at the initiative of Aboriginal communities they may do so. I think that we should accept that this is an opportunity to provide the dignity of work for Aborigines and to provide a scheme that is to the benefit of Aborigines.

Senator CAVANAGH:

– I wish to ask a supplementary question. In view of the Minister’s reply, will she refer my question as to the legality of the Department’s action to the AttorneyGeneral for advice?

Senator GUILFOYLE:

– I will certainly draw to the attention of the Minister for Aboriginal Affairs, the Minister for Employment and Industrial Relations and the Attorney-General to the question that has been raised. The Attorney- General’s Department has already given advice with regard to the claimed contravention of the United Nations anti-slavery provisions. Any other matters that have been raised to which attention may not have been given will be referred to the Attorney-General. I can assure the Senate that these programs were embarked upon after very considerable negotiation and a great deal of response from the Aborigines themselves. It is one way in which they are able to provide work programs. As communities, they have sought this opportunity. We were happy to cooperate with them.

page 1151

QUESTION

LOCAL GOVERNMENT GRANTS

Senator MESSNER:
SOUTH AUSTRALIA

-I direct a question to the Minister assisting the Prime Minister in Federal Affairs. Has the Minister been informed by the New South Wales Minister for Local Government of the distribution of Federal funds to New South Wales local councils as determined by the New South Wales Local Government Grants Commission? Has the Minister certified that New South Wales determinations are in accordance with relevant Commonwealth legislation? Can the Minister inform the Senate of the overall picture for local government grants to New South Wales for supplementary revenue in the context of the Government’s commitment to the new federalism?

Senator Mulvihill:

-Do you visualise moving to New South Wales, Senator?

Senator CARRICK:
LP

-Both Senator Mulvihill and I would appreciate the desire of those from interstate to move to New South Wales. It is true that the New South Wales Government sent to the Commonwealth Government its recommendations from its State Grants Commission. That constitutes now the last of the six States to have done so. The procedure is that when this is sent to the Government, the Minister concerned- in this case myself- should provide a certificate to the Treasurer and to the Prime Minister that the recommendation is in accordance with the Act. I have done so in this case, as in the other cases. I am hopeful that in all these cases senators get from the Department of the Prime Minister and Cabinet the information on the day that it is announced. If that is not so, I would be happy if they would tell me. The aim is that the announcement should be a joint one both at the State and Commonwealth level at the same time and that Federal senators and Ministers should have the information at that time. If that is not working, I would be happy to know.

The fact is that this now constitutes the second year of this program. As Senator Messner will know, in the last year of the Whitlam Government’s program, an amount of $79.9m was allocated. This year, $165.3m will be provided. Over a period of two years that is more than double the amount previously provided. Therefore, the effect has been a very considerable one upon local government finances. The Commonwealth Government has been in receipt of many messages from local government bodies commending it upon this program. Specifically, New South Wales will receive an increase of 17.65 per cent this time. That is an increase of over $9m -

Senator Cavanagh:

– You have sung that song before. Get a new record.

Senator Withers:

– It is a great record. It is one of the top of the pops.

Senator CARRICK:

– Yes, when it is top of the pops it is worth replaying. I am grateful for the interjection of both the Leader of the Government in the Senate and Senator Cavanagh. Here is a real success story being acknowledged by local government and State governments alike. It is worth keeping in mind that when the moneys available to the States and local government are being assessed they should be taken together because they are part of the 52 per cent of all public finance that is now spent by State and local government.

page 1152

QUESTION

PUBLIC OPINION POLLS

Senator WRIEDT:

– My question is directed to the Minister for Education. I ask: In view of the fact that public opinion surveys in New South Wales show support for the Australian Labor Party at 59 per cent -

Senator Webster:

– Ha!

Senator WRIEDT:

-Senator Webster might not laugh about that for too much longer. In view of the fact that the surveys show support for the Australian Labor Party at 59 per cent, is the worn-out record that we have just heard from Senator Carrick, which was referred to as one of the tops of the pops, now regarded by New South Welshmen as one of the drops from the pops and are they not sick and tired of hearing that record over and over again?

Senator CARRICK:
LP

-Is it not interesting that Senator Wriedt, in endeavouring to make his point, hides the gallup poll record, the public opinion poll record, of what people think of the Federal Labor Party in Australia? I simply say that if that is the bench-mark, perhaps he has the answer himself, because if he seeks to apply it that way then there must be a contra-coup bouncing back against the Federal Labor Party. Apparently, the people of Australia do not think a great deal of the Federal Labor Party. The people to judge this matter are those primarily who are from local government. The Federal body of the Local Government Association and all the State bodies of the Local Government Association have expressed the view that this is the most significant reform that has occurred in local government financing. That ought to be the best of the public opinion polls in that regard.

page 1152

QUESTION

BRUCELLOSIS ERADICATION

Senator ARCHER:
TASMANIA

– I direct a question to the Minister representing the Minister for Primary Industry. The first edition of the National Farmer newspaper reported that Australia’s brucellosis eradication campaign may be brought to a halt by meatworkers banning the handling of reactor cattle because of disease considerations. In view of the essential and vital progress of the campaign, will the Minister consider including another alternative to the program by allowing compensation to be paid to owners of infected cattle who have the cattle destroyed on their own properties, if there is any possibility of a problem that may retard the already lagging campaign?

Senator COTTON:
LP

– I have some information on this matter and it may well be that I will have extra information available later which might be helpful. There have been some agreements reached in the past between State governments and sections of the Australian Meat Industry Employees Union regarding the slaughter of brucellosis reactors. In recognition of the human health risks involved these agreements have provided for reactors to be slaughtered and processed at a slower rate and for the workers to be issued with special protective clothing. Because these provisions add to costs, some abattoirs have been loath to handle brucellosis reactor cattle. I think we are all aware of this. The arrangements between the Commonwealth and the States for payment of compensation to producers for the slaughter of reactors provide for destruction to occur on properties where in the opinion of the State Chief Veterinary Officer this is the most efficient and economic course of action. Substantial numbers of reactors have been disposed of in this way in more remote areas. The practice could be extended if it becomes infeasible to slaughter reactors in abattoirs.

page 1153

QUESTION

REPATRIATION AND ARTIFICIAL LIMB AND APPLIANCE CENTRE

Senator PRIMMER:
VICTORIA

-Is the Minister representing the Minister for Veterans’ Affairs aware that due to staff ceilings at the Repatriation and Artificial Limb and Appliance Centre in South Melbourne people requiring artificial limb fittings are being forced to wait up to two months for appointments? Will the Minister ask his colleague to take the steps necessary to overcome this delay.

Senator DURACK:
LP

– I have been asked and have answered a number of questions about the impact of staff ceilings in the Department of Veterans’ Affairs which was formerly under my control. It was a matter in which I took a great deal of interest when I was Minister for Veterans’ Affairs. I have been pleased to be able to assure the Senate, and indeed anyone else who has asked me about this problem, that although there have been difficulties from time to time in certain areas of the Department as a result of staff ceilings, the Department has been able to overcome those difficulties, by transferring staff from one area to another. Certainly up to the time that I ceased to be the Minister for Veterans’ Affairs, as far as I was aware no real difficulties were being experienced in that Department as a result of staff ceilings. Senator Primmer asked a specific question in regard to the RALAC at Melbourne. I will pass on the question to the Minister for Veterans’ Affairs for an up to date answer on the situation.

page 1153

QUESTION

UNION ELECTION: IRREGULARITIES

Senator WALTERS:
TASMANIA

-My question is also directed to the Attorney-General in his capacity as Minister representing the Minister for Employment and Industrial Relations. Can he say when the result of the Industrial Registrar’s investigation into the irregularities of the last election of the Amalgamated Metal Workers and Shipwrights Union will be made known so that the Government can take any action which may be necessary?

Senator DURACK:
LP

– The investigation into the irregularities of the Amalgamated Metal Workers and Shipwrights Union election referred to by Senator Walters was carried out by what was then the Arbitration Inspectorate of the Department of Employment and Industrial Relations. As a result of that investigation, the union is in the process of conducting a fresh election for the office of federal national organiser. In South Australia the federal executive of the union has taken a decision to conduct a new election for the office of State secretary. The latter election is scheduled to take place immediately after completion of the ballot for national organiser, which closes on 1 7 October.

page 1153

QUESTION

MIGRANT EDUCATION SERVICES

Senator SIBRAA:
NEW SOUTH WALES

– My question is directed to the Minister for Education and arises out of questions asked previously by Senator Wriedt and Senator Lajovic concerning education in New South Wales. Is it a fact that to date the New South Wales Government has failed to obtain full funds for the adult education migrant service for which the Federal Government has been responsible since 1947? Is it also true that migrant education services are so overloaded in New South Wales that they cannot be advertised and that the Federal Government has rejected a request for funds for teaching equipment for the services? Is it also true that the Federal Government has rejected a request from the New South Wales State Multicultural Centre for an immediate $2m for language programs for primary and secondary schools in New South Wales?

Senator CARRICK:
LP

– The first question asked by Senator Sibraa draws the answer: No, it is not a fact. The fact is that the Commonwealth Government has provided funds for migrant adult services fully equal to those provided in the previous year. Indeed, the honourable senator should know if he has read his Budget Papers that we have also proposed to increase the living allowance for adult migrants as from November. So there has been an increase generally in the program. In more recent times, particularly in the last year, a number of refugees has come to this country from places such as Lebanon, South America, Vietnam, and Timor, to name four, and the demand for adult migrant educationEnglish language education- has increased beyond the normal trend in previous years. That is now causing the Government to examine what can be done. The Commonwealth Government is very conscious that it has before it a newly emerging phenomenon. It is very conscious of the need for the English language to be brought to such migrants, and I have the program under close review. As to the question on the multicultural approach, I am not aware of any such rejection. I will look at the matter and give the honourable senator a reply.

page 1154

QUESTION

QUESTION TIME

Senator MULVIHILL:
New South Wales

– by leave- Mr President, I wish to make a statement on Question Time procedures. I know that the practice of asking supplementary questions is a recent one, and one which I appreciate and use myself. However, with all due respect, I believe that the system we follow means that senators in the centre of the chamber seem to come off worst. I know that you have a difficult job in going from one flank to the other, Mr President, but over the weekend I should like you to consider some method of ensuring that the same people are not always at the end of the queue. I appreciate the difficulty of your job, Mr President, and I know that the honourable senators who do not get an opportunity to ask a question one day often get an opportunity to do so the next day, but the people in the centre ranks always seem to come off worst. I am not saying this as a specific or personal criticism of you. I am merely saying that I believe that, in the light of the play, you should revise the by-laws.

The PRESIDENT:

– I thank Senator Mulvihill for his comments. He has referred to a matter which worries me a lot. It is so that today I did not give Senator Colston the call to enable him to ask a question. He had no such opportunity yesterday; nor did Senator Ryan. Only 23 questions were asked during Question Time today. That is way down on the number normally asked. I endeavour to ensure that an honourable senator who fails to get the call one day gets the call the next day. I keep records in this regard. Senator Coleman has not had a question all the week. I gave her the call today. So far as it is within my power to do so, I strive to be fair and impartial to all honourable senators. Senator Mulvihill has asked two questions this week. They were both twenty-seventh on the list.

Senator Mulvihill:

– At the end of the queue.

The PRESIDENT:

- Senator Mulvihill has been at the end of the queue on both occasions. I can assure honourable senators that I am doing my utmost to ensure that as many questions as possible are asked. Again I stress that Question Time is a time for seeking information from Ministers on subjects within their portfolios. If those questions were couched in terms directly relating to the points on which information is sought and if the replies were given in the same manner we would be able to meet to a greater degree the endeavours of honourable senators to put questions to Ministers.

page 1154

FEDERAL INTERVENTION IN VICTORIAN POWER DISPUTE

Senator DURACK (Western AustraliaAttorneyGeneral) by leave- Senator Button and Senator Bishop asked questions of me earlier today about the reasons for the Government’s intervention in the Full Bench hearing of the Conciliation and Arbitration Commission of the Victorian power dispute. In view of the importance of the matter I obtained an answer from the Minister for Employment and Industrial Relations (Mr Street). I thought that the Senate would like to have the Minister’s own words on the subject instead of my own. The answer to the question that Senator Bishop asked of me about the request from the Victorian Government is that the intervention was at the request of the Victorian Government but the Federal Government had intended to intervene in any event. As to the more general questions that were asked the Government’s action is in line with the normal procedures available for the prevention and settlement of industrial disputes under the Conciliation and Arbitration Act. As this dispute has developed increasing national significance, the Government believes that it has a real responsiblity to make its intervention in the public interest in order to bring about a speedy settlement of the dispute.

page 1154

COMMONWEALTH SCIENTIFIC AND INDUSTRIAL RESEARCH ORGANISATION

Senator WITHERS:
Western AustraliaMinister for Administrative Services · LP

– On behalf of the Prime Minister and for the information of honourable senators, I present the report of the independent inquiry into the Commonwealth Scientific and Industrial Research Organisation. The Government is considering the report and expects to make a decision on it shortly.

page 1155

REDISTRIBUTION OF ELECTORAL DIVISIONS IN TASMANIA

Senator WITHERS:
Western AustraliaLeader of the Government in the Senate · LP

- Mr President, to suit the convenience of a number of my Tasmanian colleagues, I move:

Senator WRIEDT:
Leader of the Opposition · Tasmania

- Mr President, I understood the Leader of the Government (Senator Withers) to say that the postponement was to suit the convenience of some Tasmanian senators. I am not quite clear why this action is being sought. I presume there is some valid reason for it. I was under the impression that the Government was aware that the Opposition would not be opposing the redistribution in Tasmania. Will the Leader of the Government explain why he wishes this matter to be deferred?

Senator WITHERS (Western AustraliaLeader of the Government in the Senate)- by leave- With respect, I think that that is a matter between my Tasmanian colleagues and myself.

Senator Georges:

– No, it is our concern also.

Senator WITHERS:

-Senator, the Government’s intention is quite clear. The Government has moved this motion with the support of the Opposition. For all you know -

Senator Georges:

– Do you have a division in your ranks?

Senator WITHERS:

-Mr President, I really wish Senator Georges would not be a Queensland stirrer. I had better not use other words. I suppose it is not racist to call Senator Georges a Queensland stirrer.

Senator Georges- Yes, it is, according to Bjelke-Petersen.

Senator WITHERS:

-I am sorry. If it is, I withdraw it. But there are matters between my colleagues and me and it does not suit their convenience to talk on the matter today. To suit their convenience, I thought it ought to be postponed until Tuesday. It was a matter of courtesy to some of my own colleagues.

Question resolved in the affirmative.

page 1155

STANDING COMMITTEE ON FINANCE AND GOVERNMENT OPERATIONS

Senator LEWIS:
Victoria

-by leave-On behalf of Senator Rae I move:

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-Mr President, the subject of the motion moved by Senator Lewis was considered at a meeting of the Federal Parliamentary Labor Party yesterday. The Opposition offers no objection to the motion.

Senator CAVANAGH:
South Australia

– What are the terms of reference and the powers of this Committee. Is it to look into the whole operations of the Government’s finances? Is it to report where there has been an abuse of the use of government finances? I have been concerned with the question for some time. In the near future I will bring it up in the Senate. In my contention, the Department of Aboriginal Affairs was completely robbed of $27,000 by a land investor in South Australia. The matter has to be debated in this chamber because of the absence, to my knowledge, of any investigating committee that can look into the facts of the question. It will be the subject of future discussion in the Senate. If it was in the power of this Committee, I think it could well look at such matters where there has been abuse.

Senator LEWIS:
Victoria

– in reply- I can only suggest that if the honourable senator wishes to refer that matter to the Committee he take the appropriate steps to do so. The matter that is before the Senate relates to investigations by the Committee into Commonwealth statutory authorities and other bodies which the Commonwealth owns or controls rather than government operations direct.

Question resolved in the affirmative.

page 1156

LOAN BILL 1977

Second Reading

Debate resumed from 5 October on motion by Senator Cotton:

That the Bill be now read a second time.

Senator WRIEDT:
Leader of the Opposition · Tasmania

– We have before us what is now a familiar Bill to most of us, the Loan Bill. It is a Bill that has been described traditionally over the years as a machinery Bill. It has come before the Parliament on many occasions. It enables the government of the day to effect certain transfers or debit what is known as the Loan Fund of the Commonwealth accounts for purposes of defence expenditure without increasing overall those defence appropriations rather than deducting that expenditure from the Consolidated Revenue Fund. This is a legal requirement upon all governments. Until 1975 there never seemed to be any argument about it. It was accepted that in order to enable the government of the day to fulfil the constitutional requirements upon it this method of accounting should be adopted, and it was recognised as such. In 1975 everything changed. When the Bill was introduced in that year it was used by the then Opposition in the Senate for delaying purposes. For more than two months the Government of the day was required to provide information on a whole range of matters, some of which appeared to be legitimate questions concerning government policy at the time and the financial position of the Government of the day. Others appeared to be not so relevant, just part of a delaying tactic by the then Opposition. Those of us who were in the Senate then recall that two sets of questions were asked of the Government. The first one, I think, was of 14 questions, and the subsequent one was of considerably more questions. The information was provided.

Senator Devitt:

– I remember that there was a total of 16 pages at the finish of that exercise.

Senator WRIEDT:

-Yes. The debate itself ranged over quite a period and many hours were spent on it. The first point I make is that the Bill we have before us now is essentially the same Bill as the Loan Bill 1975. There is one difference which I will come to shortly. When Senator Cotton, who was representing the shadow Treasurer at the time, spoke during the second reading debate on that Bill on 10 September, he made some observations. One of the questions asked at the time was why the Bill had been introduced at that particular time. Subsequently the information was provided to the effect that over the years the Bill had been introduced into the Parliament at various times of the year and as Senator Cotton on 10 September 1975 said:

Therefore, one can see that this type of legislation is irregular both as to amount and timing.

He went on to say:

As I have mentioned previously, the second reading speech was not terribly satisfactory. It is a very short Bill; it contains only five clauses, two of which are of any consequence, the others being of little consequence.

I would assume that as the Bill before us contains only five clauses which are constructed almost identically to the clauses in the 1975 Bill, the words of Senator Cotton in 1975 are equally applicable in respect of this Bill. We do not take the view that the explanation for the Bill is inadequate because we accept that this drafting style has been used for Loan Bills over the years but in view of the fact that the precedent of the Parliament demanding all this additional information has been set I presume that from here on as far ahead as we can see the additional information is now going to be sought and it is certainly going to be sought this year. In speaking on the 1975 Bill Senator Cotton went on to say:

As far as I can see, both the Bill and the second reading speech were treated by the Government with a mechanical approach.

That, of course, was a direct criticism of the government of the day. Senator Cotton was then saying that the government of the day was not treating seriously the matters that were covered by this Bill and that it was just a mechanical Bill. Let us have a look at the second reading speech this year and we will see that the Treasurer (Mr Lynch) is also treating this Bill in exactly the same way. He does not use the word ‘mechanical’ but in the second reading speech he said:

The simplest and traditional means of providing appropriate legislative authority is a Loan Bill of the type I am now presenting.

So it is a simple and traditional Bill this time, but it was not in 1975 according to the same people. The Treasurer went on in his second reading speech on the Loan Bill 1 977 to say:

It will simply allow reallocations between the Consolidated Revenue Fund and the Loan Fund of defence expenditures to be made during the remainder of the financial year . . .

That is exactly what was said in 1975 but it was not accepted as such in 1975. It was traditional type legislation and the opposition of the day used its numbers here in this Senate to delay what in fact was an established procedure of government accounting. I can well recall the great concern of the government of the day over the failure of the Senate to pass this Bill. It was the first real shot in what was to come and that was the eventual failure of the Senate to pass Supply. As the Senate knows, this Bill cannot be brought into operation by the Treasurer until such time as it is passed through the Parliament and proclaimed. Therefore in 1975 very significant amounts of money continued to be debited to the Consolidated Revenue Fund when in fact the Loan Fund should have been used for this purpose, but because of the playing of politics at that time with a fundamental weapon of government, whether it is a Labor government or a Liberal government, that right was taken away. I can well recall saying at the time that no Opposition had the right to deny the government reasonable time for the passage of the Bill. This, of course, does not preclude an Op- position from seeking the information which I h ave indicated earlier will be sought and which was sought in 1975. So that is the scenario of the legislation before us.

It is interesting to see this Bill introduced by the very people who would not allow passage of a similar Bill in the Senate in 1975. They now present the Bill in almost identical terms and for their own convenience no doubt expect the Opposition to pass the Bill. Of course, the Opposition is not in a position not to pass the Bill. It would not be so irresponsible as not to pass it if it were in such a position. On the same day Senator Cotton said:

I do not think that was satisfactory . . .

That is, the so-called mechanical approach- . . from the point of view of both the Senate and the amount of money that is involved. Nowhere in the second reading speech was any case made out for urgency in financing the size of deficit in respect of which this Bill is pan of the general program.

I suggest that very much the same position applies now as applied then. There is always a degree of uncertainty about the financing of deficits. We all know that. We know that a government cannot say precisely how it will finance its deficit at the end of the financial year. In fact, Senator Cotton made that point. He said:

How is this to be financed overall?

He was referring to the deficit-

Let us consider the strains this may put on the system and the dangers it may place on the financial solvency of Australia. All of us should be concerned and apprehensive about this situation.

The position today is that the deficit is very little different from what it was then, if it is considered in terms of overall government expenditure. Again we have a quote from 1975 which, I put to the Senate, is equally applicable to the present situation. It is for that reason that the Opposition will be seeking additional information. I suggest that the situation may be much worse. Senator Cotton made the comment during his remarks in the second reading debate:

The situation may improve but, on the other hand, it may worsen.

That comment is equally applicable to the position now. Having established the uncertainty of the situation in which we now find ourselves in respect of this Loan Bill, the Opposition, although not opposing the Bill, indicates that it finds it necessary to seek the sort of information that was sought in 1975 in a very similar economic situation. Possibly it is worse but I will come to that in a moment. There is no question that this Government is making very large borrowings overseas at the present time for the purpose of financing its deficit. We cannot dissociate this Bill from that program. Earlier I made reference -

Senator Sir Magnus Cormack:

– We could be borrowing moneys to finance balance of payments.

Senator WRIEDT:

-Senator Cormack is quite right that these borrowings could be for a number of purposes. No one would argue with that. The question is whether or not the financial position of the Government in 1975 is analagous to the present position. As I have just indicated, I will come to that in a moment. I said earlier that in one respect the Loan Bill of 1975 was different from the present Bill. If we look at the Loan Bill of 1975 and the Loan Bill of 1977 we find that they are almost identical except in paragraph 3 where, in 1975, no maximum amount was spelled out in the Bill. This year, of course, there is a maximum amount of $1.1 billion. It was argued by the Treasurer at the time that the Opposition of the day was very upset by the fact that the Government was putting forward a Loan Bill in which no maximum amount was specified. That might have been a reasonable proposition but if one reads the 1975 Bill one will find that the government of the day was in fact saying that the Treasurer could raise moneys borrowed under this section but which would not exceed what he considered to be the greatest amount by which the moneys lawfully available for expenditure from the Consolidated Revenue Fund in that financial year were likely to be less than the amount of the expenditure authorised to be made from that Fund in that financial year. That government was saying in effect was that even though no amount was specified there are legal constraints upon the Government which would apply under any loan Bill such as the one we are considering. Similar Bills are passed each year. That was not acceptable to the Opposition of the day. It thought there was something sinister about it.

In 1976, after the change of government, the legislation did not come in as one Bill. It came in as two Bills. The first Bill, which is now the Loan Act of 1976, specified an amount not exceeding $700m. That was fair enough. That was consistent with what the Opposition had said the previous year. But the interesting point is that the second loan Bill- and this is the first time this had been done since 1931; in fact I think it has happened only twice since Federation- specified no maximum amount at all. The wording of that Bill was almost identical with that of the Bill that was introduced in 1975. The explanation by Mr Lynch, the Treasurer, at that time was interesting. He made no bones about it. In speaking to that Bill, he said:

The eventual size of the residual deficiency in the Consolidated Revenue Fund will depend upon the effects of future events on all receipts and expenditures of that Fund. For this reason the Bill does not specify an upper numerical limit to the amount which may be borrowed. Instead, authority is provided for the Treasurer to borrow such amounts as he considers to be the likely maximum necessary to avoid a deficit in the Consolidated Revenue Fund.

In other words he was using exactly the same arguments in 1976 in respect of the second loan Bill as the Labor Treasurer used in respect of the Loan Bill in 1975. Of course when the Labor Treasurer used that wording for his Bill we were told there was something sinister; there was something wrong; the Labor Party was up to something. Mr Lynch, the Treasurer, in 1976 turned around and used exactly the same wording in his Bill. The reason was that it was written by the same people in the Treasury.

I mention this because it explodes once again one of the absurd actions that was taken in 1975 to try to bring about this atmosphere of something sinister. After this Government came to office it turned around in its own first Budget and used exactly the same clause, or as near to it as does not matter anyway, as the previous Government had used in the Loan Bill in 1975. This year we have a reversion to what appears to have been the more standard type of presentation of this Bill over the years.

It would be idle to suggest that this Bill is not associated with massive overseas loan borrowings by this Government. On 27 September-that is only a week ago- Mr Eric Robinson, the Acting Treasurer, put out the following Press statement:

The Acting Treasurer, Mr Robinson, announced today that, under arrangements that had just been completed or were now firmly in train, an amount of $850m was expected to be available to supplement Australia’s international reserves during the next few weeks.

The fourth paragraph of the statement reads:

These arrangements involve the extension of, and are additional to, the ongoing program of Commonwealth borrowings, also in the order of $8S0m, which the Treasurer had announced in his Press statement of 25 August . . .

In fact without knowing specifically just how much overseas borrowings this country has at present, it is obvious that they are at least $1.7 billion. We will not repay them all that easily. Some of the loans referred to in this Press release go through to the mid-1980s at rates of interest of 5.77 per cent. The repayments will be a sizable drain on our funds.

The Government has itself in a real mess. It has very deep problems. It has different sorts of problems from what the Labor Government had m 1975. As we pointed out at the time we were not involving ourselves in overseas borrowings simply for the purpose of financing our deficit. In fact it was well known that that was not the intention of our loan program, apart from normal loans which we would borrow on the world market. This Government is in a desperate position. It is borrowing massive amounts of money to maintain the value of the Australian dollar, fearful of the fact that it may have to take certain other action in the very near future when it will have the worst of both worlds. We do not need to spell out what that is all about. The Government is getting itself into a deeper and deeper morass of problems as time goes by. Words have been spoken in this chamber this week- questions have been asked-about the integrity and reliability of some of the people with whom this Government is dealing overseas. It has been said that the institutions involved have been the subject of inquiry within their own countries by their equivalents of our Reserve Bank concerning the legality of some of their operations. I do not want to go through that again, but these are the people with whom this Government is dealing now. We were told that the Government deals only with reputable people. I hope that proves to be the case.

To complete my comments I restate that this Bill comes to the Senate in almost identical circumstances to the Loans Bill of 1975. I have pointed out how the present Treasurer saw fit at that time, with his colleagues of the day, to disrupt and interrupt what was an accepted normal accounting process of any government. This was deliberately done in order to frustrate the government of the day. One can appreciate no doubt how the Treasurer would feel if he was to know that the Bill we have before us now was to be held up for two or three months. We know the sorts of problems that that action would create for him. We accept that need for the legislation. We point out that the maximum amount being sought under the Bill is in excess of $ 1 billion. This was a horrendous figure two years ago. It was terrible then to imagine that a government could get itself into such a mess that it would want to borrow several hundred million dollars. After nearly two years in office this Government now finds itself with deeper problems than existed in 1975. Despite all those factors, we will not oppose the legislation. I indicate that I will be seeking information from the Minister for Industry and Commerce during the Committee stage.

Senator COTTON:
New South WalesMinister for Industry and Commerce · LP

– in reply- The Bill is clearly understood by Senator Wriedt. It has a background in the Budget situation. The deficit estimated for 1977-78 is $2,217m. Underlying this is a prospective deficit of the Consolidated Revenue Fund estimated to be $90 lm after allowing for the charging of $868m to the Loan Fund in respect of grants to the States for capital assistance and for housing assistance. Senator Wriedt knows, and we all know, that the prospective CRF deficit must be met. In practice he knows, and we know, that this is done by transferring some Defence expenditure from the Consolidated Revenue Fund to the Loan Fund where the finance is obtained from borrowings. We need legislative authority now as in the past to authorise the relevant borrowings. The purpose of this Bill, therefore, is to authorise borrowings in order that Defence expenditure may be met from the Loan Fund rather than from the Consolidated Revenue Fund. We therefore do not have a deficit in the CRF which needs to be in a balanced state. As Senator Wriedt has stated, it is the simplest and most traditional method of meeting a prospective deficit from the Consolidated Revenue Fund. The process has been used by both Liberal and Labor governments. As the borrowings are necessary for defence purposes, no Loan Council approvals are necessary. It does not authorise any defence expenditure additional to the expenditure included in the Budget. There is a limit on the amount of defence expenditure charged to the $1,1 00m, but allowing for a margin of safety. The form of borrowing may be by the issue of securities to the public or the Reserve Bank of Australia or by its investment of trust fund balance in such securities.

In regard to timing, the position really is that the Bill is introduced at this time to enable the maximum benefit to be gained from it. The Bill authorises the transfer of defence expenditure from the Consolidated Revenue Fund to the Loan Fund only in respect of expenditure incurred after the Loan Bill is passed. It is normal for it to be introduced about this time. Senator Wriedt referred to the events of 1975 in which both he and I were involved. I can well understand what he has to say about these matters. If I remember correctly, about 10 questions were asked in one instalment. After a response was given to those questions, 1 8 or perhaps 14 further questions were then answered. I think that the answers provided in that situation clarified the matter considerably. I remember observing at the time that I thought the Senate was an institution that could pay more attention to economic matter:), particularly in the long term, and how a government’s funding and public financing was achieved. That was a view I held when I came to the Senate. It was a view I held at the time I spoke. It is a view I still hold. I believe that the Senate is a very valuable place to think about these things and to develop a state of greater understanding. I think that the questions asked provided the opportunity to do that and that the exercise was valuable. A situation of greater knowledge was achieved. I think that the questions were well answered. If I remember correctly, I complimented Senator Wriedt on the courtesy he showed in providing those answers. I also complimented the Treasury in being factual and accurate. I hope that that is on the record. That is what I remember of the position.

Let us look at what happened at the time because much has been said about that event. Perhaps it is easy to forget some of the events at that time. These questions were raised and the concern was expressed at the time when it was clearly evident that the Government’s Budget strategy and deficit were going to blow out completely. Senator Wriedt may know this; he may not know this. All I say to him is that when the Liberal and National Country parties were in Opposition, we constructed our own Budget in July. We had it ready waiting for the Budget of the then government to be brought down in the middle of August. I think that I am on the record -at least I hope I am- as stating when the then Government’s Budget was brought down that it would fail, that the deficit would blow right out and that the strategy was wrong. I said that if changes could be made, the Opposition would try to accommodate itself to them. But we could see a situation in which the deficit would end up at about twice the amount that was budgeted for by the Government at the time. That was one of the principal reasons for our concern.

When we became the government at the choice of the people in December, it was perfectly clear that what we suspected was true. We set out to reign in expenditure that had blown out very heavily. We had to do this. We felt that a check was therefore needed. We had great concern about the position. We believed that the figures we recieved once we became the government demonstrated that our concern was fully justified. I ask honourable senators to look at the position so far as we were concerned. This Government has held its deficits very close to their announced positions. They have changed very little. So the problem is not the same sort of problem which existed under the previous Government. It is a different problem. One or two things might be said about what was the problem of the Australian Labor Party in government. I have my own views on the problems of the Labor Party and its exercises in the loan market at that time. I have never ventilated them very greatly. I have not thought it was profitable to do so. I have a view of what the Labor Party strategy was. I have a view of what it was trying to do and it is not the view expressed by Senator Wriedt. I will be happy to announce it sometime when we have more time.

But I would like to make a couple of observations about this. If questions are to be raised, I imagine they will come at the Committee stage. We will certainly do what we can to help. Honourable senators opposite may be sure of that. But before I conclude my remarks at the second reading stage, this debate allows me to raise this question of Australia’s position at this time. We hear a lot about doom and disaster. We hear a lot about everything going down the drain. I want to comment on the figures that were published in the newspaper today in respect of company profitability and sales throughout Australia for the year ended 1976-77 as against the year 1975-76. The figures demonstrate pretty clearly that sales are rising across the board. Figures are given for the following categories: Retailers, service industries, food and agriculture, property and construction, money handlers, consumer goods makers, major manufacturers, diversified activities, extractive industries, automotive industry and clothing and textiles. There has been a substantial increase in profit and increase in sales.

Senator McLaren:

– John Martin does not say that in today’s newspapers.

Senator COTTON:

– I am not able to help the honourable senator with his individual shopping problem. But I say that across the Australian corporate scene there has been a big increase in profitability. The figures provide a plus and positive position. The figures we had in the Australian scene for the financial year ending June 1975 demonstrated to us, on our calculations, that the corporate scene in Australia was in almost a total loss phase. Submissions made to the reaction committee on the Green Paper on the manufacturing industry demonstrated that that was the fact. From a total corporate loss phase situation in June 1975 we have now moved into a situation two years after of a very big expansion in profits. Mr President, I seek leave to incorporate in Hansard the figures for the profits breakup.

The PRESIDENT:

-Is leave granted? There being no objection, leave is granted.

The table read as follows-

PROFITS BREAK UP

Senator COTTON:

-That is the situation as I see it. We could have a very long debate on the economy. That does not present any great problem. We have had a series of speeches on the Budget dealing with the economy. It will always be true in a parliamentary assembly or in the Senate that people will have great and divergent views on how to run things. There is no doubt about that. In the Australian Parliament and community there are probably at least 95,000 people who are potentially better treasurers than any treasurer in office at any time. That is a fact of life. We just live with that. Therefore, from the point of view of the Government I simply say this: It took over a situation. It believed that what it said at the time about what would happen was correct. It was happening. The Government had to move very quickly and dramatically to reign in the extravagant expenditures of the then government. We have done so. The Australian scene has improved very considerably, except in one respect. That is in relation to employment which has a very heavy follow-on position from the loss of competitiveness, the 25 per cent tariff change, the general structure of Australia and lack of growth in the time of the Labor Government. That will take time to rectify. I am trying to be objective about the scene. I am delighted to learn that the Australian Labor Party will not oppose the Bill. I think that it is very wise to take that course of action. However, the Opposition proposes to ask some questions. I suggest, therefore, that when the second reading stage is passed we might have those questions.

Question resolved in the affirmative.

Bill read a second time.

In Committee

The Bill.

Senator WRIEDT:
Leader of the Opposition · Tasmania

– I have given to the Minister for Industry and Commerce (Senator Cotton) a list of questions on this Bill in respect of which the Opposition seeks information. Before I speak about the questions, perhaps there is one thing that ought to be remembered when we are discussing all these matters connected with the deficit. During the course of the Minister’s second reading speech he made the comment that, of course, deficits vary widely from month to month. We all know that. They do so under all governments. But, of course, it is incorrect to suggest that this occurred only in the 1975-76 financial year.

Senator Cotton:

– I did not suggest that; I suggested the incorrectness of the deficit.

Senator WRIEDT:

-I am sorry. I thought the Minister said that the deficit blew out. That was the term -

Senator Cotton:

– Read the Hansard record.

Senator WRIEDT:

-Let us just make the position quite clear. We agree that criticism of governments because of the fluctuations of deficits is not in any way a criticism of the government themselves but rather it is the nature of the system. The questions which I have put to the Minister are similar to those which were asked by the Opposition in 1975. 1 seek leave to have a list of those 16 questions incorporated in Hansard.

The CHAIRMAN (Senator DrakeBrockman) Is leave granted? There being no objection, leave is granted.

The questions read as follows-

DETAILS OF MONETARY IMPACT OF THE BUDGET

What was the total of unused cash balance at 30 June 1977?

How were subscriptions to the last loan derived:

trading banks

Government itself

institutions under 30/20 rule

open public subscriptions?

How does the Government propose to fund or finance the deficit for the coming year now estimated at $2,2 1 7m?

The balance and details of the various areas outlined below would be a valuable help in analysing this position:

Net drawings under overseas credit arrangements.

b ) Net proceeds of other overseas borrowings.

Net proceeds of bond sales to non-bank public.

Net changes in Treasury Notes on issue:

to non-bank public

to banking system

Net proceeds bond sales to banking system.

f) Use of Reserve bank cash balance.

At what stage of 1976 was the equivalent bill or bills introduced; what amount was finally transferred under the procedures outlined in those bills and what was the surplus or deficiency?

Why is this borrowing being authorised outside the ambit of the Loan Council?

What is the reason for the urgency of this bill; why should it be passed before the Appropriation Acts for 1977-78?

For 1976-77, what was the amount of defence expenditure transferred from the Consolidated Revenue Fund to the Loan Fund; what were the other net transactions of the Loan Fund and net transactions of the Trust Fund?

What are the specific authorities under which expenditures have been charged to the Loan Fund from 1 976-77?

Under what authorities can Trust Fund monies be used in the Loan Fund?

Can monies currently in the Loan Fund, and which were raised for other purposes, be drawn on to meet defence expenditures?

–

What is the Loan Council program for 1977-78?

Are there any resolutions of the Loan Council relating to defence loans?

What credits are, or would be, available in the Loan Fund which can be used for defence puposes?

To what extent do the July loan proceeds relate to long-term borrowings and short term monies?

How much long and short term monies were obtained from banks and other institutions?

Does the Government confirm the overall target for the rate of growth in the volume of money (M3) announced in the Budget Speech?

If the overall target has been varied, what is the up-to-date figure?

To what extent will overseas borrowings be used to finance the deficit?

In view of the fact that the Government has raised approximately $2,900m in overseas and domestic borrowings so far this financial year, why does the Government need further loan raisings to finance the deficit?

If the Government proposes to finance the deficit from the domestic market, what will be the position if the domestic market cannot finance that deficit?

Senator WRIEDT:

-I am pleased to note that the Minister has indicated that in 197S he made the point that it was important for the Parliament to have this information and that he was still of that opinion. I am glad to hear him say that because, after the Labor Government had supplied the first series of answers to the questions sought by Senator Cotton in 1975, he said:

A lot of the information which would allow a proper debate and understanding ought to be provided to the Senate. It will be valuable to all of us if it were so provided.

I think that was quite a sound statement and I am glad to know that the Minister is still of that opinion. These questions, of course, involve matters concerning the Government’s current financial position, the prospects for the remainder of the financial year and its intentions in respect of a whole series of matters. The questions I have posed are very similar to the questions which were put to the Government in 1975. 1 trust that the Minister- I am sure he will make personal endeavours- will show the Senate the same courtesy as the Government of the day did in 1975 by providing additional and, I think, adequate answers to the questions that were posed. Again I refer to the procedure that we adopted in 1975. When these questions were put to me in this chamber I indicated that the proper course was for the answers to be obtained so that we could debate these matters properly, as Senator Cotton himself indicated. The Minister might like now to move that the Committee report progress so that there can be a proper debate in this chamber on the matters that have been raised.

Senator COTTON:
New South WalesMinister for Industry and Commerce · LP

– I have examined the 16 questions which the Leader of the Opposition (Senator Wriedt) was good enough to pass to me. Clearly, I could answer some of the questions but, equally, there are a number of questions which need to be researched in a little more detail so that more accurate answers may be provided so that the Senate itself may be thoroughly and properly informed. Accordingly, it is my wish that this debate be adjourned so that the officials of the Treasury can respond to these questions with answers which will illuminate the scene and will satisfy the queries of the Senate and the Opposition. In the process, of course, I hope that it will continue to lead to a further understanding of public finance both by the Senate and by the community. One point has been clear to me over the years. In attempting to understand public finances and to understand how governments must operate, there is an immense gap in knowledge and a total lack of understanding over a wide area, particularly by some of those people who parade as experts. We are all conscious of this.

I believe, as I said earlier, that the Senate is a very good institution in which some of these matters can be examined and discussed in the hope that we will learn more, that the Government will be a better government in the process and that gradually the community will understand these matters. Some of the comments made by people who parade as experts in the Senate- we usually are subjected to this twice a day- will be cleared up. We will find the truth about these issues and that will be very useful. Accordingly, I seek leave to continue my remarks at a later stage.

Leave granted; progress reported. Sitting suspended from 12.S6 to 2.15 p.m.

page 1163

CUSTOMS TARIFF (COAL EXPORT DUTY) AMENDMENT BILL 1977

Second Readings

Debate resumed from 5 October on motion by Senator Durack:

That the Bills be now read a second time.

Senator MULVIHILL:
New South Wales

– When the Government brought down its Budget, the coal export duty was one of the proposals at which the Opposition took umbrage. This is a universal question and relates to how much industry should pay towards the upkeep of the country. That is the lowest common denominator which can be reached, and I think it is well exemplified in relation to coal. I can recall that in earlier debates on this question fledgling senators argued about Utah Development Company and others and the contribution they made to a State. I want to deal with this matter in the broadest possible dimensions. I think everybody knows that as far as fuel is concerned, whatever our differences on uranium might be, it can be said that in the next decade coal will be king. However, that does raise a lot of problems. Any views I have on this question were reinforced last week during the sitting of the Senate Standing Committee on Science and the Environment when we heard evidence from people in the coal industry who are regarded as being responsible in the area of research as well as other facets of the industry. I say that because the capacity of an industry to pay has been argued as being a trade union or an arbitration truism. In the evidence heard by the Committee relating to the responsibility of an industry in respect of research, it was apparent that two of the greatest beneficiaries of the reduced duty on high quality coal are Clutha Development Pty Ltd and Utah. I like to regard myself as an internationalist, but at the same time as an Australian I believe that any organisation which is going to get on the gravy train has certain responsibilities.

It could be that the Minister for Science (Senator Webster), who is looking after this Bill, will be able to provide some more specific information than is contained in this pocket handkerchief sized second reading speech on what the Government regards as a fair profit. I do not regard the word ‘profit’ as repugnant, but in that respect I recall an occasion in the United States of America when the then Attorney-General, Robert Kennedy, took on Bethlehem Steel on the matter of prices. Kennedy and his brother, the President of the United States, said that the company’s profits were excessive and they produced before a Senate committee a table which showed that the extra wages for the steel workers and coal miners of the United States would come to about $1 lm or a little more but the price hike- that is an American term- would mean that Bethlehem Steel would get back $17m. It is that sort of thing which motivates me to ask: What is a fair profit? Taking that to the second stage, there has been a tendency for the Government to talk about socialist governments frightening away industry. I put it to the Senate that the internal situation indicates that coal is king. That has been said by coal experts and by members of the Miners Federation. As an aside, I point out that the coal industry has been relatively free of industrial stoppages, and in using the word ‘stoppages’ I am not ignoring Queensland. I am sure Senator Collard would know that the last mine disaster did not reflect very well on the Queensland Mines Department and the fact that its code was a little slack. Whether it be in Kentucky in the United States or Queensland in Australia, in order to entice industry, including coal operators, sometimes there is a tendency to go a little soft on the safety regulations and then there is a mine disaster.

The point I am developing is that the Government has decided to reduce this imposition but the previous Government felt that the industry was a bountiful one and should make a worthwhile contribution to the country. I want to deal with this matter in its broadest dimensions. During the hearings of the committee of which Senator Jessop and I are members, evidence was given that Clutha makes no contribution to Australian research and Utah makes a small contribution. In the Queensland context, the conservationists are arguing for more national parks in

Queensland. However, the nigger in the woodpile is that Clutha has some bauxite deposits and is not prepared to surrender them, and the overall question which has to be considered is whether the developmental aspects of the job balance out the conservation aspects. The previous Whitlam Labor Government did not tell Utah or Clutha that they could not operate in Australia but it did say that they were well able to pay the impositions made by the Government. I make that point because anybody who studies Newsweek and Time and looks at the batting record of both those companies, not merely in the United States but in all Latin American countries, would know that they live with all sorts of governments. Whether it be Peru, Uruguay, Colombia or Paraguay, the governments are military juntas and are very tough in the taxes they impose on overseas investors and overseas companies, yet those companies live with it.

I respectfully suggest that if one looks at the balance sheets of Clutha and Utah and sees the money that has been remitted to the United States, it will be accepted that they can well afford to carry those taxes. I agree that there are some industries which could be on a line ball. I can think of one now, and if the Minister for Industry and Commerce (Senator Cotton) were here in place of Senator Webster I would probably raise it with him. I will not raise it with Senator Webster because the industry I am thinking of will become the future responsibility of Senator Cotton and its economic operation is on a knife’s edge. I defy anybody to refute my assertion that every operator in the coal industry is doing well. I had the opportunity as a member of a four-man Labor Party delegation to visit Japan where we met members of the Liberal Party, the two socialist parties, parties to the left of that, and the party which I suppose is the equivalent of Don Chipp ‘s party, the Clean Government Party. All of those parties accepted the proposition of sane nationalism.

It has been admitted that when the late Rex Connor insisted that Australia go on to the open market to get coal contracts in Japan, it was quite wrong when the Japanese steel companies- the epitome of private enterprise where everybody does their own thing- aided and abetted by the Japanese Government, picked us off one by one, playing Queensland collieries against New South Wales collieries. Conversely, if Utah and Clutha come into this country they have to accept the rules of our game, which are not as oppressive economically as those of the Latin American countries. I had occasion to talk to members of two big industrial corporations in Japan and they told me, as I expected they would, of some things they did not like about the Australian trade union movement. I answered them by asking how they lived with Peru, with Colombia and Brazil. They replied that those countries had a commodity to sell and there was a good market. If it is good enough in those cases, it is good enough here.

I do not know how this Government works. I do not know whether Clutha and Utah came along and bleated, but I am going to insist that some of those rajahs of the American capitalist system from Clutha and Utah be asked to testify before the Senate Standing Committee on Science and the Environment. Senator Webster is frowning, but I say to him that if we are to give those companies a reduction in their taxation, and that is what it amounts to, I want to know why they do not give an equivalent sum of money to coal research in Australia. I am the last person to pitch for an accolade from the Country Party, but I do know that from time to time the graziers as a group have levied themselves in order to combat the danger of synthetics to the wool industry. I suppose I could say to Senator Scott that the trade union movement does the same thing at times and levies for a fund for a particular purpose.

I am simply saying that I have the big leaguers in the coal industry as the target in my sights. I see no reason why the Government has to give them these tax reductions. It may be argued that we should adopt a bipartisan attitude towards the motor car industry. We know how difficult it is in the motor car industry. We can have private views about having a multitude of car manufacturers. But it is a different ball game with the coal industry. Not one colliery is not in the black- and that is not a pun. There is no question about that. One may take the attitude that what is good for the coal owners is good for Australia. I think Senator Scott knows the State of New South Wales as well as I do. When I drive to Country Party electorates to do work for my party I sometimes have to go through the electorate of Hunter. I have read the history of the mining industry way back to the 1 850s.

I again refer to the evidence taken by the Senate Standing Committee on Science and the Environment. I asked certain witnesses why, with modern technology, one could not pump out some of the mines that were flooded to combat fires that came about through following stupid practices. They said that it would cost too much. On the one hand the coal owners say that the States have to give them a dream run as far as taxation is concerned and they do not put enough back into the industry. Conversely it could be argued that if Clutha and Utah want to mine the excellent coal deposits that they have they should be able to pay taxes on that mining.

I will await with extreme interest Senator Webster’s explanation to me on that point. I hope he will give me one. He might even produce some tabulated document which compares the Whitlam Government’s tax levy and the Fraser Government’s tax concessions with the expanded profit rate of Utah and Clutha. None of the lesser companies is really foundering. I know from my whetted appetite on this subject that many plans are projected. Getting away from party politics, there are industries that have to be treated, as it were, in cotton wool. I am talking about the manufacturing industries. But the coal industry is not in that category. As a matter of fact, the best barometer of the needs of the nation is our manpower policy. I know from evidence given by witnesses whom I probed very deeply that there is a question mark about whether the work force in Wollongong, Cessnock, Kurri and all the other coalmining areas can provide the coal miners of the future. I am not running away with the idea of mechanising mines. As a matter of fact, whatever may be said about this subject and whatever may be the political philosophy of the leaders of the miners, there was a time, as honourable senators would know, when it was regarded as a cardinal sin from a safety point of view to interfere with coal pillars. This is where the capitalist jargon about what is right is always right comes in. We were told that the miners were villains by objecting to the coal pillars being removed. Of course, I concede the point, as does the Miners Federation, that with modern technology one is able to go back and extract those pillars and thereby get a better yield.

Let me talk in a personal vein. I have some coal in one of my hands from a jamming accident that occurred when I was shovelling coal into a locomotive fire box. I said to one of these experts that at least with Newcastle coal one knew that one would get proper combustion and that one would have a good trip in one of the P class locomotives of the 1950s. Senator Collard is smiling. I do not know whether, being a diesel man, he ever used Weston coal from New South Wales. To show how one’s views can change from time to time, I point out that a socialist Minister for Mines in New South Wales was told by his advisers- ‘experts’- in the period between 1959 and 1962 that it would be cheaper to close down the Weston mines and to pay the miners their current rates of pay because there were no markets for Weston coal. As honourable senators know, there is a high slag content in it. But now we are being told that it is heresy to say that. It is now being said that it is rubbish to say that and that one can use all of the Weston coal.

I am trying to project the idea that coal is king. The collieries in the west of New South Wales were once battling. So was Collie in Western Australia. I am looking for an indication from Senator Walters about the position in St Helens in Tasmania. I do not know whether there are now any prospects there. There has been an upsurge in the industry. I say brutally about it that it is an industry that has a vision splendour in front of it for the next 10 years and nobody has convinced me as to why it cannot meet the duties presently imposed. One should go beyond examining what the Whitlam Government did in Australia and analyse the situation in all the Latin American countries. In fact, if any honourable senator were to go into the Parliamentary Library and look at the current issue of the London Economist he will find that there have been troubles in Colombia. The whole situation is one of legitimate militancy. I know that Senator Wright would regard that as a perverted term. Legitimate militancy is all right if it is aimed at getting a fair share of the cake. It might be argued that the Miners Federation has never been backward in its own right, but it has earned what it has achieved. Earlier today Senator Wriedt talked about events of 1975. I wonder whether anyone has ever looked back at the events of 1929 and the actions of coal baron Brown. No wonder the Miners Federation was irritated. I am not going to speak about the dead, but there was a situation at that time when people onthe Arbitration Court took, to say the east, a very strange stance on the issue of wage justice for members of the Miners Federation.

In introducing the present Budget the Government cannot have it both ways. It is arguing that it is trying to stimulate industry. That is all right. But the fact of the matter, with due respect to the Fraser Government and the Labor Government, is that with the world wide energy crisis it has been quite obvious that coal has been coming back into its own. I make this point as a conservationist: Obviously the recipients of coal as a fuel are prepared to spend more money on certain measures to control pollution. I am mindful of the very turbulent situation in the Middle East and the fact that our Bass Strait supplies may be running down. I know that my learned colleague from Queensland, Senator Georges, will deal intimately with the Queensland situation. In view of this Government’s cosy attitude about

Indonesia it ought to get a dividend on the joint oil operations. Be that as it may, I wind up on this point: I believe that the coal industry is a viable industry. It always has been. As a matter of fact it was a post-war Labor government that grasped the nettle and established a coal board that provided stability in the industry.

I say very resolutely that if the coal barons are prepared to accede to the demands of the military juntas in South America that they pay an adequate amount of money for the coal they mine they should be required to do the same here. As a matter of fact, I offer to Senator Wright and Senator Webster some very good reading on this subject. They should study the situation of the Pittsburg coal miners of 1890. Honourable senators may have even seen a film starring Sean Connery about the Molly Maguires. In those days one migrant group was pitted against another. That is not done now. The coal barons try to pit the Queenslanders against the New South Welshmen. As I have said, the coal barons are using this industry simply as a pork barrel exercise to subsidise weir overseas operations. I will await with interest Senator Webster’s assurances on this subject. I ask him: Did either of those firms ever say that if the rates that we imposed were to have remained they would have left the coal fields? I think the answer is in the negative. I will leave it at that.

Senator COLLARD:
Queensland

-Like Senator Mulvihill, I cut my teeth on steam engines. I ended up as a diesel man, but I certainly did my apprenticeship in the north west of Queensland on coal burners and we did not have the privilege of using good Newcastle coal. Unfortunately the costs were against our using the best. Our best coal was from Blair Athol. It was used mainly on the Garretts and the CI 9s, which were the heaviest engines that we had, and we, working on other steam locomotives, had to take what was left. It was one of my boasts that the men in the Queensland railways were the only men in the world who could run a locomotive and get steam using blue metal.

Be that as it may, the purpose of this legislation is to reduce the export duty on high quality coking coal from $4.50 to $3.50 a tonne and on other coking coal from $1.50 to $1 a tonne. If I might say so, it is not before time. The sooner we get rid of this obnoxious tax the better the industry will be and the better we will all be.

I say to Senator Mulvihill that unfortunately the whole of the industry is not as successful as some of the ones that come to mind. There are mines in central Queensland that are not making good money, especially those associated with underground operations in the Bowen Basin. There are mines there which, while losing money on their underground operations, are fortunate enough to have open cut operations and so can pick up some money there. But there is a problem peculiar to the mines in the Bowen Basin. I have discussed this with the Minister for Science (Senator Webster) and the Commonwealth Scientific and Industrial Research Organisation is looking at it. It is a problem with outbursts. Almost without warning there called outbursts, mainly off the face but sometimes from the ceiling. The mines there are doing a lot of research into this problem. It occurs mainly at depths below 600 feet. Some of the mines that have not yet got to that depth are sitting back and waiting to see what the other mines come up with. People from the CSIRO have been there. I have been underground there but Senator Webster has not. We are both trying to get underground again to have a look at the problem. Fortunately, some of the Minister’s CSIRO staff have been there. Hopefully we will be able to do something to make these mines safer and more profitable. I remind Senator Mulvihill that in this Budget a levy will be imposed- I suppose, not before time- to assist with coal research and such problems as these.

Senator Georges:

– Why do you not stick with the present one?

Senator COLLARD:

– The money collected by way of levy is to go into coal research. The obnoxious thing we are getting rid of- it was introduced by Senator Georges’ Government- is a tax on success. The coal exporters of Australia, including those in Queensland, my home State, compete on world markets. They compete against all comers. It is something to be said for the expertise of the management and the staff that they do so successfully in such a competitive market. As I have said, unfortunately when the mines started to become quite successful the Australian Labor Party, in accordance with its usual philosophy being that it is sinful to be successful, imposed this coal export levy. The company that comes to mind more than others- there have been two attacks on it recently; one by the Rockhampton Trades and Labor Council and the other by a hopeful Senate candidate in that area- is the Utah Development Company with its mines in Central Queensland. The Utah company was prepared to put risk capital into Queensland at a time when Australian investors were not. To this point in time it has built two townships of over 7,000 people. It has provided some of the most modern port facilities in the world. Indeed, I think Hay Point would now be one of the biggest coal exporting ports in the world. At one stage, with two ship loaders being used 57,000 tonnes of coal were loaded in an eight-hour shift.

The company has provided rail facilities, as I have mentioned provisionally, at no cost to the Queensland taxpayer. We have one of the most successful and most modern rail operations in the world, thanks to the overseas money that has come in. The Utah company provided the infrastructure. That is no mean feat when opening up completely new mines. Having done all this, having provided jobs and proved so successful through its expertise and the expertise of its staff which is almost 100 per cent Australian, the company was hit by the Whitiam Government with this tax on success. The company’s profit for last financial year was $ 139.97m. It paid tax of $ 103.75m. Royalties paid to the Queensland Government which at present stand at $ 1.20 per tonne, amounted to $18.95m. The amount paid to the Queensland Government by way of rail freight was $56.07m. The total paid to both State and Commonwealth governments was $20 1.31m. On top of that, the company is providing steaming coal. There is a seam of steaming coal on top of the coking coal at Blackwater. Utah is providing that coal very cheaply by arrangements made with the Queensland Government when it got the contract. Utah is providing that steaming coal to the Gladstone power house at such a low rate that it will be of eventual benefit to all people in Queensland.

We would never have received these benefits if this company had not been as successful as it is. Why the Opposition has to have these hangups about any company being successful, I do not know. This company’s success can be nothing but of benefit to the people of Australia.

Senator Mulvihill:

– And to itself.

Senator COLLARD:

-Obviously to itself, Senator. But it put the money up and good luck to it if through its expertise and good management it is able to make a profit. This year we are forgoing approximately $30m in the coal export levy. Of that amount, 46 per cent will come back to us in company tax- a sum of about $ 13.8m. I think it cost Utah about $36m to $40m for the infrastructure for the first mine. To build Norwich Park at today’s prices would cost about $2 50m. That sort of money can only be obtained through a successful operation.

When I spoke on this subject last year, I said that a socialist was an unsuccessful person whose last chance to get something was a chance to get a bit of yours. This is undoubtedly the philosophy of our friends opposite as they go about their company bashing. They seek to bash down any successful company that shows a good profit in its balance sheet. I cannot let the opportunity go without mentioning the dispute involving the Seamen’s Union of Australia and Utah. The union is trying to bash one of the most successful companies and harm a lot of jobs and many Australian workers. The Utah Development Company charters quite a few boats which are manned mainly by Spanish crews who work under the Industrial Transport Federation Award. In fact they have always been better off than those award provisions provide. But as a result of bans and submissions by the Seamen’s Union of Australia the Utah Development Company agreed to a rearrangement of terms and conditions.

Senator Mulvihill:

– Is that not an admission of guilt when they boost the rates?

Senator COLLARD:

– They agreed to a rearrangement of terms and conditions such that union members now receive the wages set under the International Transport Federation Award and better conditions. I must point out that at no time did these seamen complain about their wages and conditions. As a matter of fact, when the Seamen’s Union of Australia bought into this subject a telegram was sent from the overseas union asking the Seamen’s Union of Australia to desist and saying that the men were quite satisfied with their wages and conditions.

So we have this problem now that the Seamen’s Union is using guerrilla tactics at Hay Point. It is causing a loss of stability and loss of ability of Australia to meet its contracts. Ships are being diverted rather than coming to the Australian ports to load coal. We have the very real problem that if perchance, by some misfortune, the Seamen’s Union were to win this dispute we could not economically compete because of the increased freight rates on the European market. Thus many contracts would be lost to us with a resultant loss of jobs to the Australian workforce. We have a typical case of union leaders pricing their men out of the market. They have destroyed the Australian coastal shipping trade and it looks as though they are trying to destroy the whole of the snipping trade in and out of Australia. This is in conformity with what we have seen in the last few weeks as mentioned constantly in this Senate. I refer to the fact that the leaders of the Builders Labourers Federation and the leaders of those concerned with the generation of power in the Latrobe Valley have set out to destroy our way of life. They are using the innocent men and women of the union. They are using the families of Australia to destroy our way of life and try to put on our society their own version of how we should be living.

At Hay Point good union members only want to be about their work. They are quite content with the conditions that they arranged with the Utah Development Co. If the Seamen’s Union is allowed to win, these men would have to be stood down. Many of my colleagues in the railways ultimately would have to be stood down or sent elsewhere for jobs. As soon as the stockpiles were sufficient the miners in the hinterland also would have to be stood down- all to appease the insatiable appetite of these union leaders. These men at Hay Point are now operating under very subtle pressures to try to make them feel that they are the pariahs of the union movement; yet they are operating under the terms and conditions they have arranged. At one stage the Mackay branch of the Federated Engine Drivers and Firemen’s Association even tried to initiate a kangaroo court to take the Hay Point delegate’s union membership from him. Fortunately, that move failed; but we have what appears to be a concerted effort within the union movement by only certain sections and certain leaders to destroy our way of life and to use the men and women of Australia to do it. In summing up, I would say it is a pity there are not more companies in Australia that are successful as Utah. If there were, maybe we might be able, even then, to pay less personal income tax.

Senator GEORGES:
Queensland

– We have had intruded into this debate the dispute which rages in Queensland between the Seamen’s Union of Australia and Utah Development Co. The remarks that Senator Collard made cannot go unanswered. He stated that Utah had chartered vessels and he admitted that they are manned by Spanish crews. My information is that Utah bought eight bulk carriers for iron ore, coal and oil trade. When it bought those ships they were flying British, Swedish and Norwegian flags and employed their crews under proper award conditions. Utah sacked the crews and registered the ships under flags of convenience- I think in Liberia. Cheap labour Spanish crews were recruited. That flies in the face of what Senator Collard said. There is no doubt that Utah bought the vessels. There is no doubt that Utah owns the vessels. Their is no doubt that Utah took them out of the registry of recognised mercantile nations and registered them under the flag of Liberia for the express purpose of employing low wage crews. Incidentally, they happened to be Spanish. They could have been Greek; they could have been South East Asian crews; they could have been South Korean crews. The point I am making is that Utah used a flag of convenience to employ cheap crews. It did that deliberately. It is of no use Utah spending millions and millions of dollars, as it is, on public relations in Australia saying that it is backing Australia. It is of no use its spending all that money, which is more than the Queensland Government receives in royalties, when the truth is that it deliberately converted its ships to a flag of convenience in order to exploit cheap labour.

So much for Utah and its sincerity. So much for Utah and its actions against the Seamen’s Union in Queensland. It has taken out writs against the union to extract damages from the Seamen’s Union and in some way to disadvantage the union and intimidate it to accept conditions that Utah is trying to impose. In Queensland at the present time over a hundred seamen are unemployed. In spite of all the things that Mr Bjelke-Petersen likes to announce from time to time, the Seamen’s Union has taken a restrained position. Union members have picketed Utah offices. They stand peacefully on the footpath and they picket Utah offices. They distribute pamphlets in the Brisbane City Square. If Senator Collard were to spend some time there, perhaps he would receive one of the pamphlets and read it. I will not impose upon the Senate and ask for leave to incorporate one of the pamphlets in Hansard. I will give him one of them later. In fact, I will give him quite a number of pamphlets. He will see that what the Seamen’s Union is insisting on is the right for Australian crews, in part, to man vessels which carry Australian exports. This is nothing new. The United States of America insisits on it and writes it into its contracts.

Senator Mulvihill:

– Under the Jones Act.

Senator GEORGES:

-I do not know which Act it is, but I accept the information.

The PRESIDENT:

– Order ! I let Senator Collard stray a bit from the Bill. I think I have given Senator Georges sufficient time to reply to Senator Collard ‘s comments. Now I would like him to come back to the Bill.

Senator GEORGES:

-I will relate to the Bill. The Bill is reducing further an excise levy on coal and, in so doing, it considerably advantages a company such as Utah in Queensland. It increases the company’s margin of profitability. The profit was substantial last year. It will be even more substantial this year. I think Utah’s profit after tax was $137m, of which it expatriated $110m. I now bring into this argument the fact that Utah, having this extra advantage which the Government is now giving it, can afford to employ Australian crews on some of its vessels. The Seamen’s Union is not arguing for full Australian crews on all the ships or, for that matter, part Australian crews on all of them. The proposition that the Seamen’s Union is puttingI think that under this legislation it will be able to afford it-is the 40:40:20 principle, which is a proposition supported in part by a United Nations Agency, the International Labour Organisation. Where there is trade between two nations in a commodity produced in one nation, the principle says that it is reasonable enough to expect that vessels should be manned to the extent of 40 per cent by crew from the country in which the country originated, to the extent of 40 per cent by crew from the nation receiving the goods and to the extent of 20 per cent by crew from any other area so as not to exclude entirely Spaniards, Greeks or people from other maritime nations.

Senator Wright:

– On what rates and conditions?

Senator GEORGES:

-On the rates and conditions laid down by the ILO. I admit that we would have to look at the crewing requirements of the Seamen’s Union. In that area there may be grounds for criticism. Of course, that is another argument. My argument is that companies such as Utah making such a substantial profit and likely to gain a further profit from this legislation should be prepared to accept a reasonable proposition put by the Seamen’s Union. Senator Collard spoke of company bashing. We have heard so often the other term of ‘union bashing’. What is happening in Queensland at present is that this coal company, which advantages itself from this legislation is one of the companies which is taking a militant, active and oppressive attitude or action against the Seamen s Union, and quite wrongly so. In fairness to Utah it could be said that it would take another view if it were not for the position which the Queensland Government is taking. It says to Utah: ‘You come to an arrangement with the Seamen’s Union and we will Eft freight rates’. That is the statement of Mr Bjelke-Petersen. So the company, even though it might intend to do otherwise or might like to do otherwise, is placed in a position of being intimidated by the Queensland Government in this way and it has continued to take the stand it has taken in direct opposition to a reasonable request.

What is wrong with an excise on coal- which is what this legislation provides for- applied nationally in the national interest? What is wrong with an excise which gathers centrally a reserve fund to be used for the benefit of the nation as a whole? If the National Country Party, which Senator Collard represents, were to put an argument in favour of a subsidy in respect of agricultural products- rightly so in some areasthen a way to provide such a subsidy would be by imposing an excise or a tax upon an area which could properly afford it, and that is in the area of mining especially coal mining. If the National Country Party were to argue that a tariff should be imposed against goods from overseas, which in effect is a tax on those goods, which places an extra charge upon the rural community and the community should receive a subsidy I would go along with that proposal as well because we need to run the economy in a balanced way. If we receive from one area a substantial profit then we should be able to move some money to an area which is not so profitable. Surely the party which Senator Collard represents would not disagree with that.

If any companies within the coal mining industry are disadvantaged by this tax then there are certain exemption provisions that can be applied. But in a short space of time Utah was able to make a profit exceeding the profit of Broken Hill Pty Co. Ltd, which reached its level of profitability after almost half a century. Admittedly there was an investment and admittedly Utah is possibly the best of the mining companies. It is the best from my experience. Its operation is clean, effective and disciplined unlike the operations of other companies particularly in the Moura area. Okay, Utah is efficient and it has invested a considerable amount of money but it is receiving a substantial profit. We are saying that some of that profit should flow back to the national interest and this is exactly the purpose of this excise and it should not be denied to the people in the way that Senator Collard has suggested it. In another way this tax prevents what is happening in Australia- competition between one State and another State to obtain a market. If you have a State like Queensland which is led by a person who seems to believe that any company, especially international companies, has the right to fleece this land or to extract at a low cost highly profitable commodities then -

Senator Baume:

– They do not fleece the land.

Senator GEORGES:

– It is a mixed metaphore, simile, call it what you will. In any case, you know what I mean. What they are doing is overexploiting the land, denuding the land of its riches, to the disadvantage of Australia. What does this sort of tax do? It enables the nation to extract and to build up money; to build up a reserve. It enables the nation to stabilise the industry from State to State. It prevents one State under-selling another State just as the State of Queensland has under-sold the State of New South Wales. If it is necessary to maintain deep mines then it may be necessary to tax open cut and easy mines. This sort of tax properly directed and properly applied can do exactly that. If Queensland is not prepared to impose the royalties which it ought to impose on the exploitation of its coal then the national government should do so as it was doing under this legislation. It is regrettable that the Government is progressively removing this excise. Some of the benefits from mining in a particular area should flow back to the area concerned. It is all very well for Senator Collard to say that these companies build up infrastructures. They do. They are building up communities- self-contained communities which they overlord in a way which I find abhorrent.

Senator Mulvihill:

– The company-town concept.

Senator GEORGES:

– Yes, and the closedtown concept. If you go to the Comalco deposits without making prior arrangements and you are not a member of parliament you are likely to find yourself stranded at the airport with no means of transport. If you go to the Mary Kathleen mining area you will find that you cannot live in the township without permission and sometimes the people who live there are forbidden to have people stay with them without the company’s permission. That is the sort of thing we are building up all over the place in Queensland with these sorts of infrastructures. Let me put it to honourable senators that the riches taken from an area and the profits made in that particular area should flow back in part to that area. I will give the Senate a classical example. At Mount Morgan billions of dollars were made and all that is left behind is a shell of a town. The mine is now closed and not only do the old houses and an old community remain but as one worker told me there are also the graves of those who died of miners-typhus. That was Mount Morgan.

Senator Sheil:

-You got BP and the Walter and Eliza Hall Institute.

Senator GEORGES:

-Accepted, but where did the millions go? They went to the Middle East, did they not?

Senator Sheil:

-And to BP.

Senator GEORGES:

-Did they not go into the Middle East to exploit the oils of the Middle East?

Senator Sheil:

– Of course, some of it.

Senator GEORGES:

-Not some of it, practically all of it and a small amount went to the worthy organisation of which you spoke. That was a sort of conscience payment on behalf of the mighty and the rich that overexploit, take too much and leave little behind. The Utah Foundation is an example of a public relations exercise to satisfy the conscience of those who take far too much, too often, out of this country. We strongly object to the removal or the phasing out of this excise. We believe that eventually to protect the economy of this country the Government will find it necessary to reimpose taxes of this sort upon the mineral resources that flow out of this country. It should at least in the interests of Australia take a fair share from the rich resources extracted in this country. There is still a tax on oil and this will continue because the Government believes- there seems to be a contradiction here- that the windfall profits from lifting the price of oil to the parity price on overseas oil should not go entirely to the companies concerned. If that principle still applies in respect of oil why should it not be applied in respect of coal?

Senator Wright:

-What tax is there on oil?

Senator GEORGES:

-There is still a levy per barrel on oil, if I recall correctly.

Senator Wright:

– That is not the question.

Senator GEORGES:

-I do not know exactly. I have made the general statement. I will check it at the first opportunity.

Senator Collard:

– You have made many general statements.

Senator GEORGES:

– On this occasion I have made many general statements. If I were to pay exact attention to my notes I would be accused of reading my speech. Nevertheless, I have given as much information in a general way as many Ministers give in this place when they are asked unexpected questions. Their information perhaps is as good as the information I have just given to Senator Wright. It is not quite complete but basically correct. There is a levy. We will talk about that at a later stage. With those few remarks, perhaps I have gone too long after 3 o’clock. The Opposition rejects the proposition and believes that the Government eventually will have to accept our position.

Senator WEBSTER:
Minister for Science · Victoria · NCP/NP

– The Senate has been debating cognately two Bills, the Customs Tariff (Coal Export Duty) Amendment Bill 1977 and the Excise Tariff Amendment Bill 1977. I thank honourable senators who took part in the debate for their contributions. I consider the three speeches that we have heard generally quite excellent in their indication to the Senate of the attitudes of the honourable senators and of the parties represented in this place. The debate has been confined basically to one Bill. Apparently that was the situation in another place where the facts relating to the reduction in the duty have been the main area of debate. The Government, in the Budget Speech of 1976-77, indicated its attitude towards the existing duty introduced by the Labor Government. In relation to the coal export duty, the Treasurer (Mr Lynch) said on page 32 of the Budget Speech:

The Government has always regarded this as an entirely inappropriate form of tax.

The quality of deposits varies markedly, but within and between the two categories which are subject to duty the effects of the duty fall in a quite haphazard manner.

Marginal fields pay the same rate of duty as economically more profitable fields, or in some cases, more.

The imposition of this duty has had the undesirable effects both on existing producers and on potential developments.

It is the intention of the Government to remove this particular levy, but for budgetary reasons which will, I think, be obvious it is not possible to reduce it at one stroke.

It will however be reduced immediately, in what the Government regards as the first step towards completely phasing out this particular tax within three years.

The Government is taking these steps towards phasing out this levy to encourage the healthy development of the industry.

The attitude of the Opposition was reiterated by Mr Keating in another place when he spoke recently on this Bill and said:

I also make it clear that the Opposition was of the view that the present coal export duty levy was indiscriminate in its application. I stated then:

Whilst the present levy was indiscriminate and unfair in operating across the board on all coal company profits, the industry is healthy enough to sustain a selective tax to increase the return to the Australian people’.

In spite of Senator Georges ‘ comments, I felt that Senator Mulvihill may have accepted Mr Keating ‘s view that it was an indiscriminate tax which had been introduced by the Labor Government and may be as well for this type of tax to be reduced. It is worth making the point that this amendment to the present customs tariff coal export duty is the second reduction in the duty. In this year’s Budget the Treasurer has again reaffirmed the Government’s intention to remove the remaining duty next year. The Government believes that this promise of removal, which it has been able to carry out, is a major factor in making possible the development of new coal projects in Australia. I doubt that anyone would disagree with that. Senator

Mulvihill was quite correct in saying that today there appears to be a healthy atmosphere within the coal fields and in the developments of coal resources in this country. He made the point that the importance of coal will be established in the next decade. That was not the situation two years ago. I think perhaps the Opposition will recognise that at this time. It is obvious that the direct use of coal, the use of coal in synthetics and the use of coal in conversion to liquid fuels will do as Senator Mulvihill indicated. It will be one of the most important minerals to Australia in the forthcoming years.

Senator Mulvihill argued about a relationship between fair profit and what might be the Government’s take. It has always interested me during the time that I have been a senator that the Labor Party- perhaps we may term it the socialist party- has always attempted to argue whenever it has seen profit being made. It has always appeared to me to be a most peculiar attitude. It is not really an attitude which is held by the socialists themselves. I have never met a socialist who is not anxious to ensure that he himself retains the greatest profit out of any type of work that he may be undertaking. Nor have I found it in the trade union movement.

Senator Georges:

– What are you talking about?

Senator WEBSTER:

– I hear a moan from Senator Georges but we have heard the various comments by trade unions. The Australian Council of Trade Unions in Victoria is a great example. The President of the ACTU is an example. We have heard calls from the trade unions for disclosure of accounts, for assessments of profitability and for profit levels to be make known. Yet a company group such as ACTU Stores will never disclose its profit. It will never print its balance sheet for the use of the public. It eels that it is competent for it to keep to itself the profits that it is making. Under the present laws regarding proprietary companies that is quite possible.

Senator Button:

– Why do you not get back to science and science fiction?

Senator WEBSTER:

-Senator Button who is well aware of some of the activities in Victoria at the present time, attempts to break in. I hold the view that I would encourage greatly the maximum of profit by endeavour to any particular person or any particular group. Senator Collard made this point. Why cannot the socialists accept it? From its disclosed profit of $ 130m, which has been audited and looked at closely by the Taxation Office, the Utah company last year paid $110m to Senator Mulvihill, to me and to the whole Australian community. This was for the general use of the community. It was made possible because of the high profit the company had been able to make. That point is overlooked, I can say only that the point obviously is going home quite hard to those who had not thought about it. They are agreeing that it is necessary that we should encourage profit in this community. That was the attitude adopted belatedly by the Labor Party in its last year of office. But it had chased organisations and people away from this country. Companies were under great stress during the Labor Party’s term of office.

Senator Mulvihill and Senator Georges pointed out how well the Utah company had managed its affairs in Queensland. That point was generally accepted by all who spoke in the debate. It must be remembered that the thrust of his Government’s action in this respect is not towards an excise; it is towards an export duty which will fall purely on the export of coal. That duty in 1975-76 produced $11 1.6m. In 1976-77, it produced $ 1 2 1 .3m. It is estimated in this financial year that the duty will return to the community $93m. There has been a decrease of approximately $28.3 in those years. The revenue forgone is about $24m.

If I understand Senator Mulvihill ‘s comments correctly, he asked whether I might be able to produce figures that could compare the effect of this duty and the final return to the community. I am not able to do so. The figures would be estimates for such things as payroll tax, the tax in relation to the build-up of a wage and salary bill and the take of the Government by way of taxation when duties are being applied on an industry in this way. Obviously, where higher profits are available to a company, we can be assured that the Taxation Office will be looking at the true effective profitability. We are ensuring that we are partners positively in any development to the greatest extent that we possibly can. A company tax of 46 per cent in the first instance illustrates my point. I think that situation is accepted by the Opposition as well as by the Government. It is one to be commended. I make that point on company tax because I think Senator Mulvihill missed it. Whilst he is frowning at this stage, I recognise that that is an important point which should be made. Senator Collard was the second of those who spoke who had been involved in utilising coal in their early working life. Senator Mulvihill and Senator Collard were engine drivers in their early life. It is a compliment to them that they are now representatives in- the Senate. I compliment them for their undertaking.

Senator Georges:

– Oh!

Senator WEBSTER:

-Senator Georges complains again. I think he wants me to bring to light again his management of the turtle industry. I do not intend to do so even though Senator Georges feels it may have been of great credit to him. Senator Collard nearly used the same words that I would use in relation to the harm that is being done to this country because of the influence of some trade unionists. He directed his attention to what is happening to Utah and its attempts to export for the benefit of this country. It can be said that some unions are blackmailing our society at present. It is essential that this Government in the near future moves to rid our society of these people who are saboteurs of our economy. I hope that the Government will do that.

Senator Georges defended the actions of the unions in relation to the Utah development and spoke of the influence of Spanish crews and other overseas crews. In a rather peculiar way, Senator Georges attempted to say that the unions are endeavouring to use more Australian labor to counterbalance the influences of cheap labour in overseas countries. That is what I understood from his general comments. I noticed that he mentioned Spanish crews and those people overseas who were cheaply paid and then referred to our attempts to utilise Australian crews on our runs. That is what the argument in Queensland at present is about. When the Labor Party was in power- Senator Georges was a supporter of that Government- it did not recognise the need for the sustenance of the Australian work force and support of Australian industries. Those who smile in the Opposition today welcomed the announcement by their Leader, Mr Whitlam, and the others who were with him, that tariffs were to be cut by 25 per cent right across the board. That action had the most disastrous effect that any proposal in this country in the last 10 years has had. What the Labor Party did at that time is exactly what Senator Georges says he hopes will not occur now. He does not want us to hand our business to countries which are involved in providing cheap labour. That is what was done by the Labor Government. Its actions sent the footwear industry over to the Near East. The electronics industry went overseas. Indeed, 30,000 jobs were lost to the community. That is exactly what the Labor Opposition is saying we should do now. The double standards adopted by those who sit opposite are a great disaster. They should think before they leap.

I welcome one aspect which concerns my portfolio. I refer to the announcement of the Treasurer in his Budget Speech that it is the

Government’s intention, with effect from Budget night, to introduce a charge of 5c per ton on coal to set up a research project. I am informed that arrangements to do this are already in train. I support to the hilt the concept that it is absolutely necessary that this country take a great interest, as it is at present, in this matter. There has certainly been a generation of interest in coal research in the last 12 months. That is most essential considering the coal- that important asset- that we have in this country. Again, I thank the honourable senators who have spoken in this debate for the quality of their speeches.

Question resolved in the affirmative.

Bills read a second time.

In Committee

The Bills.

Senator MULVIHILL:
New South Wales

- Mr Temporary Chairman, I bow to your tremendous knowledge of Standing Orders. With due respect to the Minister for Science (Senator Webster), he omitted to answer one aspect of my comments. I asked whether he could give us any figures comparing relative coal tax impositions and excise duties by Australia and Latin American governments. I do not know whether his advisers have the information.

Senator Webster:

– Latin America?

Senator MULVIHILL:

– Yes. It is a matter about which I was curious. Has the Minister any information?

Senator WRIGHT:
Tasmania

-While the Minister for Science (Senator Webster) may be attending to that request, I would like to know from the Minister in due course an assessment of State royalties on this industry and their impact as compared with the export duties that are the subject of these Bills. I regret that pervading Senator Georges’ speech were references to excise. The Commonwealth tax that is the subject of these Bills is an export levy and is classified in Government papers as I understand it as a customs duty.

Senator Georges:

– Well, I am sorry.

Senator WRIGHT:

-I mention that only to clarify what otherwise might be confusion in the record. But I go to the point of substance. I have heard it said that the objection to this export duty is that it falls upon the just and the unjust alike, upon the pure and the not so pure alike. I can understand that. But do I understand that State royalties have that same incidence? I want to know whether there is any opinion within the Government yet as to whether State royalties are in reality excise duties- exactions imposed upon the production of goods? If so, insofar as we lift export duties, are State royalties increased? The two things must be considered together in any rational system of government. The ultimate reconciliation may come by accepting a conclusion that although we have traditionally throughout the century accepted the description of royalties, in truth that exaction is an excise. I offer no opinion but I ask whether the Government has any opinion on the matter. From inquiries which I made some nine months ago I doubt whether there is any settled opinion accepted. I just raise the point. If there is no opinion on the matter, I would like to be advised m due course as to what the Attorney-General’s view is on that point.

Senator WEBSTER:
Minister for Science · Victoria · NCP/NP

– I am unable to supply an answer to the question raised by Senator Mulvihill. My advisers do not have that information with them. But they will attempt to find out the levies in Latin American countries and have assured me that they will supply that information directly to the honourable senator. In respect to Senator Wright’s question, I am advised that the levy which is imposed by the States could be determined as an excise. I stand subject to correction on that point. But my advice is that it is very difficult to state what the exact figure is because it is basically set as a variable percentage based on the export price. For instance, the figure may become 10 per cent of the f.o.r. price which is then lowered if there is adequate profit from the rail profit that is disclosed. Underground mining attracts a lower incidence of tax. I am advised that it is difficult to obtain this figure. I have asked the officers to note the exact wording of the honourable senator’s question and we will attempt to get a direct answer for him.

Senator GEORGES:
Queensland

– I thank Senator Wright for correcting my misuse of the word ‘excise’. I take the point that he has made. As it stands, it is a duty because it is imposed upon goods which are being exported whereas excise, I take it, is an internal tax. Is that correct, Senator Wright?

Senator Wright:

– Yes.

Senator GEORGES:

-The next question Senator Wright asked interested me very much. If, as the Minister says, the royalties could be termed to be an excise, where does the responsibility lie to gather that tax? Perhaps Senator Wright could tell us a bit more about where he was leading there. Does he say that if, as the Minister admits, it is an excise, is it a Commonwealth responsibility to gather in that tax?

Senator Wright:

-The usual procedure I prefer is to go step by step.

Senator GEORGES:

-I hope the honourable senator does not take too long to take the next step because it is an interesting path that he follows.

Senator WEBSTER:
Minister for Science · Victoria · NCP/NP

-I hope I used sufficient words to say that it could appear similar to an excise tax. The fact is that a State collects royalties. That is the term applied to tax. The difference between an excise- an export duty- and a royalty is something for definition as to the way the tax is actually applied. My attention is directed to a comment here which states that should the State governments seek to take advantage of this to increase their own royalties, the Government will have to review its position. That comment was made in the House of Representatives on 16 August. I think that may answer some of the points raised by honourable senators, subject to a re-reading of the general points they have made. I thank honourable senators for their comments.

Bills agreed to.

Bills reported without requests; report adopted.

Third Readings

Bills (on motion by Senator Webster) read a third time.

page 1174

QUESTION

BUDGET PAPERS 1977-78

Debate resumed from 5 October on motion by Senator Cotton:

That the Senate take note of the papers.

Upon which Senator Wriedt had moved by way of an amendment:

At end of motion add ‘, but the Senate is of the opinion that the Budget:

will intensify and prolong the recession;

b ) will increase unemployment;

will have little impact on inflation;

will make regressive changes in the tax system; and

will reduce living standards’.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-The Senate is debating the Budget Papers that were presented to the Parliament in August 1977 and introduced into this House by Senator Cotton, the Minister for Industry and Commerce, in his capacity as Minister representing the Treasurer. My colleague, Senator Wriedt, the Leader of the Opposition, has moved an amendment to the motion that the Senate take note of the papers to add the words: but the Senate is of the opinion that the Budget:

  1. a ) will intensify and prolong the recession;
  2. will increase unemployment;
  3. c) will have little impact on inflation;
  4. ) will make regressive changes in the tax system; and
  5. will reduce living standards.

It is in support of the amendment that has been moved by the Leader of the Opposition in the Senate, Senator Wriedt, that I address my remarks this afternoon. At a time when Australia is most in need of a constructive forward looking recovery policy which recognises and reacts to the problems facing Australia, the Fraser Government has chosen to opt out of a possible recovery process, to mark time and in traditional conservative fashion to await some godsend from abroad or perhaps from above. That conclusion is beyond doubt when we examine the Fraser-Lynch Budget for 1977-78.

We must bear in mind that the Budget supposedly represents the considered policy program of the Government for the coming 12 months- for the financial year 1977-78. We have heard on many occasions this Government’s expressed concern for and recognition of the problems of inflation and unemployment. On these issues the latest Budget is phrased in terms which are now so familiar to all of us. The Budget Papers talk of the ‘Government’s first goal’- I emphasise those words- being ‘the maintenance of the underlying trend to lower inflation’. It is stated that unemployment is ‘a matter of grave concern’. The Government, through the Budget, promises to give ‘a lead to the community by addressing itself directly and realistically to the problem’. The Budget fails on all of these counts. It lacks any sort of comprehensive strategy and effectively neutralises any previous strategies that were put forward by the Fraser Government.

Close analysis of the strategy contained in the Budget reveals a number of points about which there can be little doubt. Firstly, the Government has acknowledged that Australia is destined to suffer further economic and cultural stagnation, higher unemployment and no significant reduction in the rate of inflation, notwithstanding what the Prime Minister, Mr Fraser, himself may have said in recent times. Secondly, not only does the Government acknowledge this fate of our nation but also it is willing, apparently, to accept it and assist it by failing to take the necessary steps that are so obviously needed. Despite world trends, the Prime Minister and his Ministers are continuing to insist that the public sector of the community has no stimulatory role in the recovery process because, in persisting with its obsession to cut government spending at a time when government spending is most needed in certain sections of the economic community, the Government continues to demonstrate that it has failed to learn from the many mistakes it has made in office.

Thirdly, the Government has ignored overseas developments- in particular, the slackening off of world recovery, the increasing trend towards reflationary policies and, most importantly, the emergence of growing structural unemployment problems. The evidence that is available from overseas economies which are further along the road to recovery than Australia ‘s economy is that the level of unemployment is not falling as economic activity picks up. Yet, the Fraser Government persists with policies which, far from recognising and seeking to avoid the growing structural unemployment problem, are actually designed to increase the number of people who are thrown out of work and the number of young people, in particular, who are in search of a job for the first time in their lives. Moreover, the Government has patently lost direction and that is now obvious to its own supporters. It now lacks any identifiable strategy for economic recovery. The Budget is, in effect, an admission of defeat by the Liberal-National Country Party coalition. It is rather ironic that in this sort of economic environment the Government has the audacity to be talking about, contemplating, suggesting or floating the rumour that a Federal election will be held in the near future. As a consequence, the Government has panicked by introducing inconsistent policies and jumping from one policy to another in the post-Budget period.

I should now like to deal with each of the points I have mentioned in turn. There can now be little doubt that economic conditions are destined to worsen under this Government’s present policies. Despite Mr Fraser’s specious claim that inflation has now fallen to 9.2 per cent- a claim that he based on a price indicator that is not even included in the Government’s own Budget Papers- the Treasury has quietly warned that inflation will in fact worsen towards the end of 1977, due largely to the flow-on effects of actions that have been taken by the Government itself. The recently published Reserve Bank report, which the Government chooses to downgrade or conveniently ignore because the report does not serve its own political purpose, forecasts that prices will rise a further 1 1 per cent to 12 per cent this financial year.

So far as the unemployment front is concerned, the best that the Treasury can manage in the Budget Papers is the hope that there will be little change in the level of unemployment in the period to June 1978. But most other forecasters are more honest in their predictions. They are forecasting a rise from the 350,000 people at present out of work to more than 420,000 unemployed by early next year, after the school leavers have hit the labour market for the first time. For instance, the confidential Reserve Bank forecast that was published last week predicts that unemployment will reach 6.1 per cent by the end of March next year compared to the 5.3 per cent of the work force currently unemployed. Meanwhile, the country’s external position remains extremely unstable. Our international reserves have been falling at an alarming rate during September, thereby reflecting large-scale capital outflow in anticipation of a further devaluation of the Australian dollar. The Government, by virtue of its previous halfhearted and inconsistent stand on the exchange rate, has lost all credibility with the business sector of the community. The Government recently announced its intention to borrow abroad but, in failing to positively state its intention to maintain the Australian dollar’s current level, speculation in the business community about a devaluation still continues, notwithstanding anything that may be said by anyone in this Parliament. The Government cannot stop the business sector of the community speculating and expressing concern at the present economic environment.

Senator THOMAS:
WESTERN AUSTRALIA · LP

– Or the Labor Party.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-We are only repeating that which is going on in the business sector of the community. My friend Senator Thomas from Western Australia should go to the great commercial cities of Sydney and Melbourne at some time and listen to some of the business speculation that is going on. He will find that we are only mirroring the concern that is being expressed by the business sector of the community. It should be noted that devaluation expectations usually reflect one of two thingseither an underlying imbalance on the trade account or expectations that a country’s economic and inflationary performance in relation to its trading partners perhaps might worsen. There can be little doubt that under the present Government’s policies the latter is the case. The business community, through its persistent outflow of private capital, is publicly making known its gloomy expectations for the Australian economy under the policies of the present Government.

The Lynch Budget-the Budget that was introduced by this Government as recently as August-has done nothing to alleviate those fears. It is noteworthy that the recent burst of speculative capital outflow occurred after the Budget was announced. The Budget was brought down in this Parliament in mid-August and the speculation and the outflow of capital occurred in the month of September about a fortnight after the Budget had been presented to this Parliament. Due to the Government’s bungling of the exchange rate and its failure to reduce both inflation and inflationary expectations the economy is now locked into a high interest rate position. The Reserve Bank itself has acknowledged that:

In the current context of a weak balance of payments and a high rate of inflation there will be upward pressures on private short-term interest rates.

This will have consequences for the whole financial environment and is directly contrary to the Government’s promise of lower interest rates- an undertaking that was made or implied earlier this year. Indeed, the Prime Minister continues to allude to further interest rate reductions. It is certainly an undertaking that he will have difficulty keeping, given current inflationary conditions, exchange rates speculation and the Government’s need to finance its ongoing deficit this year.

Senator Wright:

– What are the obstacles against reducing interest, having regard to the New York and London rates?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-The obstacles obviously are the policies of the present Government. The present Government is completely incapable of effectively handling the nation’s affairs. Promises that interest rates would fall encouraged investors to take up government debt earlier this year, and it is highly doubtful that those investors will be fooled a second time. That the Government has chosen to accept and indeed perpetuate high inflation, high and rising unemployment, and uncertainty in the exchange and money markets, is abundantly clear. The Budget does nothing to alleviate any of those problems. On the contrary, I suggest that it positively accentuates them.

By insisting that the government sector should have no stimulatory role in the recovery process, the Fraser Government is actively causing higher unemployment in the country. Its claim that government expenditure will crowd out private investment has been shown to be incorrect. The fact is that private investment did not respond to the Government’s so-called investment-led recovery strategy. There is clearly a need for and room for government expenditure to provide some stimulus, and until demand on the part of the Australian community picks up, until the public is encouraged to spend, the much needed private investment for which the Government is waiting will not eventuate. One might ask rhetorically: Why should business invest in new plant and machinery and new production efforts when it can see no evidence of growing demand occurring for the product that it manufactures under the existing economic policies of this Government and when its existing capital equipment is only about 80 per cent utilised? The Government’s investment-led recovery sought to stimulate investment via the wrong means, by providing investment allowances and by reducing industry’s costs through cuts in real wages.

I suggest, and the Labor Party believes, that the Government has misread the needs of business. Business confidence needs a boost and most, if not all, businessmen to whom I have spoken in recent times will affirm that. With real wages being progressively reduced, and they are being progressively reduced, and with a very high personal savings ratio occurring, and one only has to consider the deposits in the banking sector of the community to realise that, I suggest that there can be no hope of private consumption providing the boost to demand that is so needed. Any stimulus via the export sector is dependent on the faltering pace of world recovery. Therefore the only sector that is able to provide the needed stimulus to economic recovery is the government sector of the economy. But in the 1 976-77 Budget the Fraser Government failed to provide that boost. Indeed, its very policies dampened down that boost. It cut real spending by about one per cent, and unfortunately this year it has again failed to learn from its mistakes of the past.

Senator Wright:

– But one of the greatest deterrents is the heavy load of taxation that you socialists put on to pay your way. What incentive is there to invest while you have to pay that rate of tax?

Senator DOUGLAS McCLELLANDSenator Wright is talking about rates of taxation and things of that nature. The Government is supposed to have done something about taxation in this Budget, and I will be making some detailed comments on that later on. But it has also imposed very heavy additional taxation by way of the increase of 11c a gallon in the price of petrol, and that will add considerably to the inflationary crisis. It has failed to learn from its mistakes. Real expenditure has again failed to rise. The Government has refused to admit, and

Senator Wright still refuses to admit, that there has been a mistake and that appropriate stimulatory government action needs to be taken. When the Government closes the public sector of the community and does not build the bridges, the roads, the dams, the railway lines and the rolling stock, all those things that are so badly needed in this country and all of which go to stimulate the private sector of the community, the great industrial cities such as Newcastle and Wollongong virtually come to a standstill. There is to be a byelection in the electorate of Cunningham and I challenge Senator Wright to go to Wollongong and espouse in that electorate the sorts of things that he espouses in this Senate. He will find that there will be a swing against the Government not of 10 per cent but of 18 per cent or 20 per cent.

From Senator Wright’s utterances in this Parliament, and he is a representative of the Government, it is obvious that the Government has failed to understand its mistakes and, by a continuation of its policies, it is effectively encouraging continued recession and unemployment. The Government has refused to take a warning from overseas experiences, and there is a need for government action in that area and on the emerging structural unemployment problems. It is clear that the Government is quite willing to see the unemployment problem in Australia worsen and the level of economic activity thereby remain depressed. The Australian people were told by this Government that as inflation was brought down so too would unemployment fall. The Prime Minister, using an implicit price indicator, has said that inflation is now down to 9.2 per cent. We do not accept that. The Budget Papers do not accept that. If what the Prime Minister has said is correct, one would expect the rate of unemployment to be falling at the same time. But it is very substantially on the increase, and it is quite clear that this Government is quite willing to see the unemployment problem in Australia worsen and the level of economic activity remain depressed.

The Fraser Government opted for new tax arrangements which were estimated to reduce government revenues by about $400m in the coming year. Given the Government’s insistence on reducing the size of the Budget deficit, the decision effectively reduced the level of government expenditure which could have been used either directly to stimulate economic activity or specifically to aid and assist the unemployed. The Government’s record in the areas of unemployment assistance and retraining is frankly appalling. In the 1975-76 Budget the Labor Government allocated about $754 a head to assist the unemployed by way of retraining and structural adjustment assistance schemes. We were doing everything within our power to ameliorate the unemployment problems that were occurring as a result of the world wide economic recession.

Senator Archer:

– World wide?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-Of course they were world wide, and Senator Archer knows they were. When his Party was in opposition it was not prepared to accept that they were world wide and now it is caught with its own propaganda. The assistance figure fell to $239 a head in 1976-77 and has risen only marginally to $257 this year.

Senator Messner:

– What about revaluation?

Senator DOUGLAS McCLELLANDSomeone interjected: ‘What about devaluation?’ The Government put the dollar on a floating basis, and there is continued speculation as a result of the capital outflow that is occurring in this country, and, in business circles there is again consistent talk about devaluation. I was talking about the level of assistance to unemployed people. In the last Budget of the Labor Government the assistance was $754 a head. In this Government’s Budget in 1976-77 the amount fell to $239 a head and has risen only marginally to $257 this year.

Senator Wright:

– Per head of what?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-Per head of unemployed in the community. Nothing has been done by way of the establishment of structural adjustment schemes. Very little has been done so far as the establishment of retraining schemes is concerned. There has been no revival of the Regional Employment Development scheme. Nothing has been done to reestablish the Australian Assistance Plan.

Senator Wright:

– Who abolished the Regional Employment Development scheme?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– It was still in existence when we left office. If the honourable senator looks at the 1975-76 Budget he will see that about $250m in round figures was still being allotted by Labor for that purpose. If honourable senators opposite do not do anything about the re-establishment of a scheme of that nature between now and the next election they will really be in great electoral difficulties. They should go round some of the electorates and some of the country towns in New South Wales, which is something about which I am sure Senator Baume would be aware, and see some of the social problems that are occurring and ask the local government authorities what they would like about the re-establishment of the Regional Employment Development scheme.

The Government has deliberately cut its revenues by $400m and simultaneously redistributed income to the high income earners, which is a clear indication of the Government’s social priorities. Its claims that these tax cuts will boost consumer demand are being shown to be fallacious. The marginal propensity of high income earners to save and the erosive effects of the high petrol prices on any gains accruing to the low and middle income earners will effectively ensure, as I said earlier, that there is no boost to consumption on the part of the ordinary wage and salary earner this financial year.

Meanwhile the inflationary problem persists. The 35 per cent increase in unemployment since this Government came to office- that is what it is- has had minimal impact in bringing down the rate of inflation; yet the 1977-78 Budget- this Budget- will actively generate a further inflationary spiral. The decisions relating to the pricing of petroleum products- the 1 1 cents a gallon increase in the price of petrol to which I referred earlier- will have a direct impact on the consumer price index in the December quarter and doubtless an indirect impact in subsequent quarters. Moreover, the Government’s weak, indecisive stand on the exchange rate seems likely to result in a further devaluation of the dollar, adding still further to the inflationary impetus next year.

My third assertion was that the Government had begun to panic. It has lacked a clear economic strategy for the past year. The growing number of policy reversals over recent monthsindeed, since the introduction of the Budget in August- is ample evidence of that fact. One need only refer to such actions as the last minute decision that was taken to introduce tax cuts in the Budget, despite the ambiguity of the Budget. A Minister- I think it was the Prime Minister- had then to come out and give a guarantee that no one would be worse off as a result of the tax cuts that were announced in the Budget. As was stressed earlier, the Budget was supposed to be a document which was the outcome of months of thoughtful economic preparation.

There was also the decision to raise company taxes to 46 per cent in order to take account of recent and prospective increases in corporate profitability’. That is clear evidence of the Government’s inconsistency. Although most observers have acknowledged the failure of the investment-led recovery, as was promised by the

Government when it assumed office, the Government still continues to claim adherence to this strategy, its aim being to restore profits to about 16 per cent of the gross national product. The Government has now decided to tax the rising company profits that have resulted from its policy and thereby will wipe out any of the supposed advantages accruing from it. Despite that, Senator Wright had something to say earlier about the taxation policies of the Labor Government.

There has been a series of post-Budget policy reversals which certainly must leave no doubt that the Government has lost direction in its economic management. These reversals were carried out by a government that came to power on the undertaking that it would provide sound economic management. Since the Budget was introduced only two months ago we have witnessed a number of policy reversals and upheavals. There was the Government’s belated attempt to patch up its new taxation system. There was a statement one day by the Treasurer, there was another statement another day by the Minister representing the Treasurer and then there was yet another statement on yet another day by the Prime Minister himself. There was the Government’s revision of the tax averaging provisions for farmers. There was the post-Budget decision to assist the beef industry. There were contradictory reports on the future of the resources tax that was mentioned in the Budget Papers. Of course, there also has been continuing uncertainty about interest rates and exchange rates.

Without doubt the most revealing indicator of the Fraser Government’s concern about its ecomomic performances is the obvious obsession of the Prime Minister with the holding of an election after only two years in office.

Senator THOMAS:
WESTERN AUSTRALIA · LP

– Whose speculation is that?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-That is everyone’s speculation and the Government does not seem to be prepared to put that speculation to rest. As a result even its strongest supportersthe editorial writers of the great metropolitan dailies- have been expressing concern about the Government’s failure to put that speculation at rest and thereby offset the further uncertainty, confusion and doubt in the business sector of the community. We all remember that the Government came to office in 1975 with a clear mandate in the House of Representatives and a clear mandate in the Senate. It was said by the Government at the time that it needed three years in which to handle the situation. If an early election is contemplated there can be only one motive behind the Government’s stategy. Under the economic policies that are being pursued by this Government the unemployment situation is going to worsen, economic uncertainty is going to continue, the inflation rate is not going to fall, interest rates will remain high and the deficit will be higher. It is therefore now or never so far as the Prime Minister is concerned.

The Government is completely lacking in any public credibility. It is regarded as arrogant, elitist and incompetent. Its Ministers feel that they are born to rule. The public now believes otherwise. The Government has run out of steam. It certainly has run out of electoral support. I suggest that that will be shown in the byelection for the Cunningham electorate on Saturday, 15 October. Wollongong, which is situated in that electorate, is one of the great provincial cities that have been very severely hit and terribly depressed by the economic policies being pursued by this Government. The Government is quickly running out of electoral support, as will be shown by the people in the Cunningham by-election on Saturday, 15 October. I have much pleasure in supporting the amendment moved by the Leader of the Opposition, Senator Wriedt.

Senator BAUME:
New South Wales

– The Senate is debating a motion that the Senate take note of the Budget Papers. The Senate has had the pleasure of listening to Senator Douglas McClelland expounding eloquently on the reasons why an election should not be held. I can well understand why no member of the Australian Labor Party wants an election to be held. I can understand why they do not ever want elections to be held. I do not know whether there is any truth to the speculation which they have been fuelling so carefully, but I say to them that we on this side can all understand their desire that there should be no election for as long as possible because they know they could not win it. They know the people would not have them on in a fright.

The Senate has been discussing an important and constructive budget; a budget that has brought into being some new tax reforms, long sought and long awaited by the Australian people; a budget that provides a framework for the continued attack upon inflation which, according to an indicator mentioned by Senator Douglas McClelland a moment a go, now stands somewhere below 10 per cent and, on his figure, actually at 9.2 per cent.

Senator Messner:

– What was it in 1975?

Senator BAUME:

– I take the point from my colleague, Senator Messner, that in 1975 inflation was 17 per cent. We are looking at figures now below 10 per cent solely as the result of careful financial management, careful husbanding of the resources of this country.

I remind the Senate that in this country 120,000 new jobs have been created since this Government came to office. They are jobs that did not exist before. In fact the work force in Australia is growing. If we look at the number of people registered for employment in December 1975 and add to that the number of people who were unemployed but who received assistance through the Regional Employment Development scheme, we find that the figure was in excess of 360,000. The unemployment figure as at August 1977, though still unsatisfactory, is down to 324,000. There has been an improvement in the unemployment situation though not only through the creation of new jobs. It is incredible to me that someone of the experience of Senator Douglas McClelland, a man who was a Minister in the Labor Government, a man who did so much to help put Australia where we found it in December 1975, a man who helped to create the conditions of economic disarray fails to acknowledge the nature of unemployment today. He fails to acknowledge that in the unemployment situation in this country there is a marked preponderance of untrained youth, of young people leaving our schools with no skills that they can sell on the market. It is this group of people particularly who are providing us with problems in the unemployment area. It is this Government that has moved systematically and vigorously into the area of assisting with job creation for young people.

We have avoided all the draconian measures that were so freely promised before the Budget was brought down. I wonder why people kept spreading rumours. I wonder why they thought the $16 a day subsidy for private hospital cover was going to go. None of these things have come to pass. Instead, we have set a blueprint which will carry on our fight against inflation. We have brought in tax reform. We have started the inevitable move towards world price parity for oil. We have heard nothing from people like Senator Douglas McClelland as to what alternative policy we should operate there. Perhaps they would like us to wait until 1981 and move directly to world parity in one step. Perhaps that is the solution they would recommend for Australia. It is clearly a responsible step that we have taken.

Further, this Government has stood by the Australian dollar in recent weeks in the face of one of the most disgraceful speculative attacks ever mounted by any Opposition in any Parliament. The Australian dollar is sound and safe. This Government’s action has been decisive and effective. To the extent which the Australian Labor Party and its friends continue to speculate against the dollar they in fact speculate against this country and they speculate against its economic future.

In the time available to me in this debate I wish to talk about a particular interest I have in liberalism in the western suburbs of Sydney and to respond to some attacks made on me personally in another place last night by the honourable member for Prospect, Mr Klugman. There is strong support for the Liberal Party and for liberalism in the western suburbs of Sydney. There is a large number of people who support what we stand for and who support the work we are doing in the western suburbs. The western suburbs of Sydney are part of my electorate. I have as much right in that area and as much right in any of those places as Mr Klugman or any other member of Parliament. If I move into those areas to work, I do so as of right. The fact that I have worked actively in the western suburbs is something which the honourable member for Prospect will have to accept and to learn to live with. He finds it uncomfortable. He will continue to find it uncomfortable because there are large numbers of people in the electorate of Prospect who come to me for their representations, who come to me for help. They are unwilling to go to a member whom they find remote, both geographically and personally, and whom they find ineffective when they approach him.

After some episodes in the last three weeks, I have a better appreciation of why I receive so many approaches from people in the western suburbs of Sydney in the electorate of Prospect. During this period we have been organising and carrying out effectively a visit by the Prime Minister (Mr Malcolm Fraser) to Club Marconi, an excellent club at Bossley Park in the western suburbs and in the western end of the electorate of Prospect. It is amazing that this visit has provoked from the honourable member for Prospect several outbursts in the Parliament which are not true, which are most damaging and which are most unfair. I regretfully feel it necessary to intervene in this debate to set the record straight and to identify the flagrant untruths by the honourable member for Prospect and to do justice to many loyal friends in the area, to my friends in the Club Marconi and to the Club itself.

The circumstances of the Prime Minister’s visit to the Club Marconi are very simple. I have been a member of this Club for some time. Many honourable senators in this chamber will know that the Club has attached to it what is possibly the best club soccer team in this nation, a team which I hope will in the next couple of weeks bring home the Challenge Cup which it is so close to winning. As a member of Club Marconi I have made it my business to visit the Club regularly. It is conveniently situated in the heart of the area I visit and work in. When I visit the Club I maintain close contacts with the directors, the president and the office bearers of the Club. It was during visits to Club Marconi that the president and his office bearers raised with me on a number of occasions their concern that no Liberal leader and no Liberal Prime Minister had previously been able to visit Club Marconi. They put the very reasonable view that this Club, which is an important and very significant centre for the Italian-Australian community in the western suburbs, was a place that deserved a visit from a Prime Minister of Australia.

Not only because I am a member of Club Marconi but also because I thought the point the Club was putting was impeccable, I approached the Prime Minister by letter of 7 March this year suggesting that he should make available some time to visit Club Marconi as a guest. On 12 August I was given a firm date. It was indicated that the Prime Minister would be able to make himself available to visit the western suburbs on 23 September. Immediately I set in train the activation of the long-standing invitation from Club Marconi. The Club was delighted to accept and act upon the invitation which it had suggested to me. The arrangements for the visit were confirmed by telephone on 16 August with the President of the Club, Mr Angelo Bagatella, a very prominent and responsible member of the communty

The visit by Mr and Mrs Fraser took place on 23 September. It is necessary to inform the Senate of the three activities in which the Prime Minister engaged when he was at Bossley Park. He arrived at Club Marconi and attended a function for Liberal Party workers in the western suburbs for approximately 45 minutes. At this function there were no speeches. There was no political rally. The Prime Minister merely made it his business to move around and say ‘Hello’ and to be introduced to the people who had gathered. Following this there was a dinner organised by the directors of the club which lasted, I suppose, an hour and a half.

Following this the Prime Minister moved among the members of the Club through the Club premises until about 10.30 in the evening, a period of some further hour and a half.

During all this time at the Club there were no political speeches. There was no attempt to talk politics. This was an effort by the Prime Minister to meet and listen to the people of the far western suburbs of Sydney. That is what he did. The only speech I can remember was a speech of welcome from the President of the Club at dinner and a brief response of thanks from the Prime Minister. During the time the Prime Minister was there all he did was say ‘Hello’, listen and take part in the Club’s activities. The Prime Minister played bocce, which I am sure other honourable senators will know all about if they move among the Italian community. He played barille, which is a rather more difficult sport in which to engage. He drank a fair number of glasses of ale with the people he met.

The honourable member for Prospect took exception to this visit. In fact, he saw it appropriate on 2 1 September, before the visit, to speak on the adjournment debate complaining about the visit and saying that it had been organised by the Prospect Electoral Conference of the Liberal Party and alleging that the President of that Conference was a con man. One can understand why the honourable member for Prospect does not like the Conference of the Liberal Party. It is too effective in cutting back his margin- so effective in fact that when he rose on the adjournment last night he described his seat as a swinging seat. It was not a swinging seat a few years ago. It is a swinging seat following his occupancy.

The honourable member took exception to a whole series of things. He told a number of untruths about the visit which must be set straight because they are quite unfair and improper. He alleged that the visit to Club Marconi was an electioneering stunt. It was set up months ago and it was conducted in a low key manner quite unlike an election rally. Secondly, he alleged that I approached Club Marconi to seek the visit. That is untrue, as I have explained. The honourable member alleged that I asked Club Marconi to let us have Liberal supporters in the Club at a discount price of $2 a head. That is quite untrue. Club Marconi indicated to us that we could have Liberal supporters there provided there were no political speeches, which suited us. It suggested that a charge of $2 a head would cover its costs. Just to set the honourable member for Prospect straight, I have been in touch with Club Marconi today. It assures me that it made a handsome profit by charging $2 a head for the drinks and savouries which it supplied. If the honourable member for Prospect intends to use his adjournment speech last night for distribution in the electorate and if he wishes to have in it allegations that we talked the Club Marconi into some subsidised arrangement, he will be spreading a falsehood. I want him to know that because we will watch to see what he does with the material which he put down last night. The honourable member further alleged that, contrary to arrangements with Club Marconi that six people might sit down to dinner, we turned up with 60 people. He said: a party of 60 turned up for a free feed. These were the hangers-on of the Prime Minister.

Senator Lajovic:

– They were editors of different Italian papers.

Senator BAUME:

– My colleague, Senator Lajovic, who was present at Club Marconi, points out so correctly that the majority of the people who sat down to dinner were the directors of Club Marconi, their wives and guests of the Club. The majority of people were there by invitation of Club Marconi itself. The editors of the Italian Press were there, the Prime Minister’s party was there, and I had a party of people there. The interesting thing is that the honourable member for Prospect has deliberately misrepresented what went on. The reason he has done this is the fact that the function was so successful that he cannot get over the fact that SOO people turned up as Liberals to meet the Prime Minister. After a successful dinner the Prime Minister moved through the club premises for several hours amid friends from the Italian community. Someone, either the honourable member for Prospect himself or someone giving him information, has chosen to misrepresent the facts. At the very least, the honourable member for Prospect has brought into the Parliament material which is not true and which he has not bothered to check. I can understand the problems which the honourable member for Prospect faces- new boundaries, a new electorate, new preselection. I am sure he will have the vote of the new mayor of Fairfield, and I wish him luck; but he should be careful if he hopes to misrepresent as he has done the proper activities of the Prime Minister of Australia moving among his community.

When I opened, I said that the western suburbs of Sydney is a great Liberal area. It might be worth while to set down just how many Liberals live there. For a start, I place on record that my election to the Senate in 1 974 depended upon the Liberal vote in Labor seats in the western suburbs of Sydney. The margin was close. There are large numbers of people in the western suburbs who will not vote for the socialists. Of the six seats that surround Club Marconi, some of which were mentioned by the honourable member for Prospect last night- the seats of Chifley, Macquarie, Macarthur, Parramatta, Prospect and Werriwa-the Liberal Party holds three. There are 205,466 people who voted Liberal at the last election, and in none of those seats did the Liberal Party get less than 37 per cent of the vote. In fact, in most of them its vote was well above that. The only accurate thing that Mr Klugman said last night was that I organised the Prime Minister’s visit to the western suburbs. I certainly did organise it and I will certainly continue to work in the western suburbs. I will continue to visit the area. I will continue to work for the citizens who need decent representation. They need something better than they have been getting. I will continue to bring significant government figures into the electorate simply so they can get to know the area better.

Can anyone seriously say that it is to the disadvantage of the western suburbs if the Prime Minister visits and sees the area? Of course it is not. It can only be to the advantage of the area if he comes to understand first hand some of the things which have been concerning us.

The people in the western suburbs desire an active, interested and concerned representative, and if they cannot get it from the ones they have got they will continue to look to their senators. As a senator interested in the western suburbs I will continue to take Ministers there whenever I can. I will continue to visit Club Marconi; I will do it proudly. I am quite disgusted by the flagrant untruths spread last night on the adjournment debate by a member in another place- for what purpose one can only guess.

Senator SIBRAA:
New South Wales

-I rise in this Budget debate to support the amendment that has been moved by the Leader of the Opposition in the Senate, Senator Wriedt, which reads:

At end of motion add ‘, but the Senate is of the opinion that the Budget:

will intensify and prolong the recession;

will increase unemployment;

will have little impact on inflation;

will make regressive changes in the tax system; and

will reduce living standards’.

Before I deal with the Budget I point out that I do not know of the events about which Senator Baume has just been talking, but he did mention the fact that there are six electorates surrounding the Club Marconi that he was talking about. Three of those seats are at present held by the Liberal Party. He also mentioned the fact that the seat of Prospect was considered to be a marginal seat.

Senator Baume:

– By the member.

Senator SIBRAA:

– Yes, and he also implied that the honourable member for Prospect, Dr Klugman, might be in danger of holding the seat in an election or in danger of holding it in a preselection. All I can say to Senator Baume is that I confidently expect, also as a senator from New South Wales, that after the next election all of those six seats will be held by the Labor Party and that there will be a very large swing in the seat of Prospect towards the Australian Labor Party.

The Budget that we are debating at the moment is already thoroughly discredited, and one of the main reasons that it is thoroughly discredited is because of the actions of the Prime Minister (Mr Malcolm Fraser). He has been going backwards and forwards across this country raising speculation about whether there will in fact be an election. I just put it to the Senate: How can there be any sense of business certainty at all with everybody speculating daily as to whether there will be an election? This is a Budget that has already been rejected by a wide section of the Australian community, by large sections of business, by large sections of the trade union movement and in the media. I think the most recent example of the extent of the rejection of this Budget was the results of the elections that have been held in South Australia and also in New South Wales. The electors have preferred the practical approach of the ALP. They supported Labor candidates in the State election in South Australia and in the local government elections in New South Wales. I live in the electorate of Mackellar. It is a safe Liberal seat. There are six Liberal seats surrounding the area in which I live. It is a little bit like the situation about which Senator Baume has just been talking.

Senator Baume:

– Which six?

Senator SIBRAA:

-They are Mackellar, Warringah, Bradfield, Bennelong, Berowra and North Sydney. At the last Senate election I was elected by only a very narrow margin and perhaps I could say that that was because of the 200,000-odd people in those North Shore safe Liberal electorates who voted for the Labor Party. In the local government elections in the electorate of Mackellar two councils were involvedthe Warringah Shire Council and the Manly Municipal Council. In the elections for both of those councils for the first time Labor Party people have been elected to the councils on the official ALP ticket. We now have two official Labor aldermen on the Warringah Shire Council and two on the Manly Municipal Council. This happened in spite of a very strong attack against the endorsed Labor candidates by the honourable member for Mackellar, Mr Wentworth, who in the adjournment debate in the other place on the Thursday night before the local government elections were held called the Labor Party candidates, amongst other things ‘fifth column candidates’ and asked all people who lived in the Warringah Shire and the Manly municipal area to put the Labor candidates last on the ballot paper.

Senator Grimes:

– It is all right if he does it; we are not allowed to do it.

Senator SIBRAA:

-That is right. What hap.pened was that in two ridings in the Warringah hire Council the people did not put the Labor candidates last; in fact they placed them in a position so that they topped the poll to give us that representation to which I have referred.

Getting back to the Budget, I shall deal with some of the Press comment and some of the scathing criticism that has been made by the Press about this Budget. I refer to two items that appeared in the Australian Financial Review. I do not think anybody would say that the Australian Financial Review leans towards the Labor Party. I will quote its comments in two of its editorials. One read: the Lynch Budget for 1977 is a dangerous document. It cannot be dignified with the description of being an economic policy, because in its own terms it is not

In a later editorial, also in a most damning indictment, it described the Budget as being ‘a shabby confidence trick unworthy of any serious government’.

So much for Press reaction to the Budget. Let us look at it in detail. The Budget’s central features will mean increased unemployment because of the continued cuts in public expenditure. It will mean increased inflation. One of the things that has been mentioned is the increase in the price of petrol, as was pointed out by Senator Douglas McClelland. The Budget will also increase the burden of personal taxation for just about all Australians This emerges, despite the smokescreen that has been put up by the Treasurer -

Senator TEHAN:
VICTORIA · NCP

– That is not true.

Senator SIBRAA:

– Well, for all but some of the wealthiest Australians.

Senator TEHAN:
VICTORIA · NCP

-What about the 225,000 people who do not pay taxes at all under this Budget?

Senator SIBRAA:

– I made a statement. I said that the Budget will increase the burden of personal taxation on all but the wealthiest of Australians, and I will get around to explaining that. This emerges, despite the smokescreen that has been put up by the Treasurer (Mr Lynch), despite the confusion that has been engendered by the conflicting statements issued by the Prime Minister and the Treasurer, and despite the backing and filling over issues such as tax averaging for primary producers. I believe that this Budget will further reduce business confidence. It does nothing to encourage investment. It does not stimulate consumer spending. It destroys any chance of economic recovery in the foreseeable future. Its overall impact will mean reduced living standards, a higher cost of living, greater taxation and less services and facilities for most Australians.

But most importantly, the Budget means more unemployment which is currently running at a rate of 5y2 per cent of the work force and, according to Professor Warren Hogan of the Sydney University, who I believe is the senior economic adviser to the Government, the rate will possibly reach 8 per cent early in 1978. Of the unemployed, approximately 40 per cent are young people seeking work, and this is a great tragedy. Possibly early in 1978, 100,000 or more school leavers will be added to the unemployment rolls, and this does not of course, take into account those young people leaving school who, because they cannot get work, will return to school. It also does not deal with the particular problem of the number of young people in this community who have been forced to take jobs that they do not want and that they have not been trained to do. In bare numbers, on the statistics approximately 430,000 Australians may be out of work by March 1978, which is a post-war record. Of course these bare statistics do not tell the story about the number of people who would have been without work for some period during the previous 12 months.

I saw some statistics the other day which lead me to believe that by March 1978, if we take into account the previous 12 months, there will probably be in excess of 800,000 Australians who at one time or another were out of work in that period. Already under this Government 90,000

Australians have been added to the unemployment rolls. Senator Baume said that 120,000 additional jobs were provided. If those 120,000 jobs have been provided and filled there have still been an additional 90,000 people who have been placed on the unemployment rolls. There will certainly be more joining them. These bare statistics do not take into account the number of married women who would like to work but who are not registered and those people who have left school, been unable to find employment, and gone back to school.

Senator Baume mentioned inflation. Inflation remains high and will continue to run at a rate of 10 per cent to 1 1 per cent. The Budget Papers concede this fact and this can only be an admission of failure. I was very interested to see that Senator Baume used figures that Mr Fraser has been using recently to prove that the rate of inflation is, in fact, a single figure. He did not use the consumer price index figures which would have proved that it is, in fact, in double figures. If this Government has been able to do one thing successfully, it has been to confuse the people of Australia as to the true situation concerning inflation by using so many different indices.

Senator Walters:

-Will you use the CPI figures?

Senator SIBRAA:

– I made a prediction that it will run at the rate of 10 per cent to 1 1 per cent in the new year.

Senator Walters:

-What is the CPI figure now?

Senator SIBRAA:

-I believe that the CPI figure at the moment is in excess of 10 per cent. I am making the point that different scales are being used deliberately to try to prove that the inflation rate is under 10 per cent.

Senator Walters:

– What was it when we came in; what was it when you lost power?

Senator SIBRAA:

– I realise that the inflation rate has gone down but what about the unemployment figure?

Senator Walters:

– You are the only member of the Labor Party who admits it.

Senator SIBRAA:

– I am saying that the inflation rate has gone down marginally. I am also saying- I do not know whether Senator Walters is listening- that unemployment figures have increased by 90,000. The Government’s economic adviser has said that the unemployment rate in March 1978 could reach 8 per cent, which I think will be a tragedy. It is unresting to note that the CPI increases for every six-month period under this Government have been higher than under the last six months of the Labor Government, yet we have seen economic lunacy, such as massive devaluations, unrealistically high interest rates and increased charges. Again I mention petrol. Of course, all these things will contribute to a higher rate of inflation. While we are on the subject of inflation, the underlying rate of inflation has increased by nearly 50 per cent in the last six months. If one looks at things like foodstuffs, Medibank and transport costs, one will arrive at this figure. This is at a time of a fall in real wages. The President of the Conciliation and Arbitration Commission, Sir John Moore, demonstrated the falsity of the Treasurer’s claims that real wages have risen when he stated at the last national wage decision that real wages have declined since May /June 1976, using the consumer price index as the statistical base. That is not what I have said; it is something that Sir John Moore said. So much for the Treasurer’s credibility, which is about as rubbery as his Budget figures.

Let us look at some of the other things the Budget does not do. It provides no stimulus for the construction industry. It provides no funds for local employment programs. This Government will not re-introduce the Regional Employment Development scheme. I know all that has been said about the RED scheme but last weekend, as part of my duties, I was in the Lyne electorate in New South Wales where 2,000 people currently are registered as unemployed at the Taree Commonwealth Employment Service office. This is in a small country area. When people took me around the area they pointed out with pride the things that were done under the RED scheme introduced by the Labor Government. In this Budget funds for apprenticeship training have been reduced by nine per cent or $1.6m. There is no manpower policy under development or consideration anywhere in the Budget. This Government has no long term economic planning strategy and the Budget will in no way create jobs or stimulate economic activity.

In the field of social security unemployment benefits now will be paid fortnightly in arrears. This will mean greater hardship for the unemployed but also it will create greater hardship for the staff of the already overloaded Department. There will be a greater backlog to be dealt with in the future. There are already signs emerging that there will be a reneging on promises for aged persons’ accommodation as there appears to be no intention in this Budget to provide the promised $225m over three years. To do this would require $130m in next year’s Budget alone just to make up the short-fall. There is no lone fathers’ benefit, despite the Prime Minister’s promises to introduce it. There is no increase in the unemployment benefit for those under 1 8 years of age. This still remains at S36 per week. Funds for pre-schools have been cut by $6m. Funds for education have fallen by one per cent in real terms whereas under Labor they grew annually by 39 per cent. Most student allowances will not be increased. Funds for business colleges have been abandoned at the same time as the Government is transferring $2m to the wealthier schools in this country.

There has been a decrease in expenditure on health of 9 per cent in real terms. We have seen community health funds slashed by 15.3 per cent. This will strike at the most vital services in the community health field. One of the areas that concerns me greatly is the field of urban and regional development. The area improvement program has been abolished. Growth centre funds have been cut back to $5m for AlburyWodonga and $3m for Bathurst-Orange and Macarthur. While this might look impressive really it is just administration costs. The $5m for Albury-Wodonga and $3m for Bathurst-Orange and Macarthur will be required just to keep these schemes ticking over, as it were. The national sewerage program has been abolished and urban rehabilitation funds have been reduced. In the rural area, on which I wish to spend some brief time, the promise for the Rural Bank has still not come about. We were presented with this Budget as a package Budget, a Budget for which there could not be any alterations. But because of the tremendous protests that were made by the rural communities throughout Australia what have we seen? We have seen a mini-Budget within a matter of weeks of the main Budget being brought down.

I want to spend some time on the plight of sport in Australia. We saw in this Budget an allocation of $lm and a subsequent setting up, as a result of an announcement made in the Budget, of the Sports Advisory Council. I think this Sim is too little, too late. At the opening of a fund raising function to send our team to the Moscow Olympics- I think it was in Melbourne- the Minister for Environment, Housing and Community Development (Mr Newman) said:

Government assistance will reinforce the principle of selfhelp.

Those days are gone. I would like to quote from an editorial in the Daily Telegraph dated 9 August. The editorial, entitled ‘Sport Spoils’, said:

Those proud days when Australians won sporting gold medals as if by right are sadly gone- we have been left trailing behind countries which pour massive government funds into the pursuit of athletic success.

The decline in our sporting standards was driven home with stunning force at the last Olympic Games.

And in other sports there are few Australian teams or individuals who rank among the world ‘s best.

Poor facilities and lack of money to keep up with latest training methods or finance tough international competition is the major cause of this decline.

The editorial goes on to say:

It has been shown by other countries that government aid is the only way to international sports success, which, despite the fulminations of those who deplore the trend to science and professionalism, counts for a lot in today’s status-happy world.

The editorial goes on to point to the performance of our team at the Montreal Olympics where we received the lowest tally of medals since Berlin in 1936. This is not criticism of the individual athletes as far as I am concerned; but it is criticism of Federal government policies.

Let us look at the Budget appropriations. Under the Labor Government in 1974, an amount of $1.1 5m was set aside for sporting facilities. In 1 975, $2.65m was set aside for sporting facilities. Yet this Government has decided to cut back on this expenditure. I personally do not consider that the two figures that I mentioned were sufficient allocations for sport. I think that, if we compare the situation here with that which exists in comparable countries like Canada and the United Kingdom, we will see part of the problem that we face. A recent article in the Sydney Sun entitled ‘Aussie Flop on Sport Aid’ stated:

Canada will spend $22m of Government money on sport in the next 12 months while Australia will have practically nothing.

Canada heavily backed its sports to prepare for a good showing in the Montreal Olympics.

After the Games the Government set up a committee to appraise the efforts made and results achieved by various sports.

It then resolved that the $ 17m available for the Games be maintained the following year.

Sports which showed they had put previous Government aid to good use will have their payments increased at the expense of the failures.

In Australia, sport assistance from the Federal Government has almost vanished.

Let us look now at the United Kingdom. Another article in the Sydney Sun entitled ‘UK Games Investment’ states:

Britain’s government-run sports council announced last night it would provide half the estimated £5m sterling ($7,900,000 Australian) needed to build a new national athletics and cycling stadium at Sandwell, in the West Midlands.

That is not a particularly large area. This Budget shows the Government’s lack of interest in sport and recreation. Apparently life was not meant to be easy or enjoyable.

When we compare our facilities and our degree of professionalism with what happens in the United States and in Western and Eastern Europe we come off very badly. I know people will say that in the communist countries the athletes are state professionals. In the United States and Western Europe, talented athletes are enjoying university scholarships, special jobs in private enterprise or special positions in the armed forces. That does not happen here. This is not the full story either. That is not the only reason for success. I think we have to look at the performance that was put up in the last Olympics by the East Germans. The population in the German Democratic Republic is small by comparison with a number of countries in Europe and especially even in Eastern Europe where all people live under a similar social system. East Germany has first class facilities. It has a first class physical education program for all children. That and expert coaching are the reasons for its success.

Dealing with the matter of facilities the Australian Sports Institute Study Group said recently when talking about Australian sport facilities:

It is a well documented fact that Australia is desperately short of sports facilities of international standard. In fact, it seems incredible that Australia has acquired international prestige as a sporting nation when one examines the training facilities and circumstances presently available for sportsmen and sportswomen.

First class sporting facilities are necessary for many reasons. They allow sportsmen and sportswomen to reach their optimum performance levels, they provide venues for international and national championships and other important events, they allow competitors to prepare themselves adequately prior to national/international competition, they encourage participation in spoiling activities generally and they provide a suitable venue for sporting activity at regional and local community level.

To highlight the lack of specialist sporting facilities in Australia one only has to examine what facilities each State can presently offer. There is no indoor athletic track, cycling track or heated swimming pool of international standard in Australia. There are only four outdoor synthetic athletic tracks available to our athletes, just as there are no special indoor facilities for our gymnasts, weightlifters, fencers and others.

The Australian Sports Institute Study Group certainly brought home the lack of facilities that exists in this country. I suppose this raises the question: What has to be done for sport in this community? In the Sydney Daily Telegraph of Monday, 14 February 1977, as part of an article entitled ‘Sport gets pushed to the back’ the Canberra columnist wrote:

Restoration, of the National Sports Institute, scrapped soon after the Liberals came to power in Canberra, is really the only answer to the problem.

It will co-ordinate Australia’s drive in amateur sport, particularly athletics and swimming, providing national training programs with modern equipment.

It will also eventually help sponsor local tournaments and meetings and provide finance to send national teams overseas.

All of which costs money.

I know that, whenever this subject is raised, people say straight away: Where will the money come from?

Recently the Confederation of Australian Sport pointed out in a submission to the Government that the Federal Government had allocated $32m directly to the creative arts this financial year and only $356,000 directly to recreation and sport. That was before the grant of the additional $lm. The Confederation went on:

Sport contributed about $100m a year to government revenue. The Treasury received $3Sm a year from sales tax on sporting equipment alone.

I would think that that answers the question: Where will the money for sport come from?

I could go on ad infinitum about what I consider is wrong with this Budget. I believe it is severely contractionary. It will result in less services and a more difficult life for most Australians, though not all, and not those with special interests that are supported by this Government. Looking at the Budget as a whole and seeing what should be done, I refer to a proposal that was put out recently entitled: ‘A Proposal to Get Australia Working Again’. It was issued by the Leader of the Australian Parliamentary Labor Party, Gough Whitlam, and Bill Hayden, the spokesman on economic management. It suggested that to stimulate confidence and promote economic activity the Government should lower interest rates, forgo increased taxation, protect the currency against devaluation in the future, and, most importantly, create new jobs by allocating additional funds for capital works, by encouraging local government advancement programs and by providing funds for apprenticeship and job training. The outlay for these proposed programs is in the vicinity of $800m for a full year. Some $250m of this figure would be saved in unemployment benefits and raised in income taxes. A Labor Budget would create jobs, generate carefully fostered growth and help to restore a healthy business community in this country. I support the amendment moved by the Leader of the Opposition, Senator Wriedt.

Senator TEHAN:
VICTORIA · NCP

– I rise to support the Budget. Whilst the Budget debate in this place, in common with the first reading of a money Bill, allows for a wide ranging discussion of a variety of subjects, I propose to confine most of what I have to say to the Budget. I think perhaps it is timely that I do so not only because the amendment moved by the Leader of the Opposition (Senator Wriedt) claims that the Government seeks to make regressive changes in the tax system but also because Senator Sibraa, who has just resumed his seat, made the same mistake. I thought it would be clear to anyone who examined the Budget Papers that this Budget introduces the greatest tax reforms since Federation. It is timely for us to examine those reforms. In the course of my remarks I hope to reiterate some of the things that the Treasurer (Mr Lynch) said so that the Australian public will be under no illusion about the great value of these reforms. We have heard from a number of Opposition speakers in the debate. Whilst they have been critical of the Government and some of the intiatives in the Budget, they have failed to suggest any strategy which would be available as an alternative to the matters which they have criticised.

Of course, the people of Australia still remember the alarming escalation of wages and prices during the three years of the Labor Government which climaxed in an inflation rate of some 1 7 per cent per annum. Our Government has made it quite clear since coming to office in 1 975 that its overall strategy and number one priority is to reduce this rate of inflation. Indications are that inflation is now running at slightly under 10 per cent per annum, so it can be claimed fairly by our Government that despite the great problems caused by inflation which confronted it at the time of its election in December 1975, substantial progress has been made in reducing the rate of inflation to a more realistic level. The way is now open to economic recovery with greater incentive for entrepreneurs to risk capital, thus expanding the economy and creating more employment opportunities.

I suggest that the Government is to be congratulated on the reduction of its deficit. I propose to deal with three reductions in the early part of this speech- the reduction in inflation, the reduction of the deficit and the reduction in taxation. They are three of the great achievements of this Government. As I say, the Government is to be congratulated on the reduction of the deficit. This will enable a consolidation of the economy and it will also enable us to build upon the foundations which were so successfully laid in last year’s Budget. The Treasurer and the Government are to be congratulated also on the accuracy of the forecasting of the deficit, both in respect to revenue and expenditure. Both revenue and expenditure were very much in line with the original estimate. The Budget is designed to further reduce the deficit to $2,2 17m, a reduction of $523m on the figure for last year. After allowing for overseas transactions, the domestic deficit is estimated at $ 1,347m in 1977-78. That is almost $650m less than the figure for the previous year. It is worthy of note that the Government hopes to finance this deficit solely from loans raised within Australia without creating additional paper money in contradistinction to the wildcat finance schemes and borrowings witnessed during the term of the previous Government.

I turn now to consider the specific initiatives introduced in the Budget. The first of these, as I have already outlined, is taxation reform. The Treasurer rightly declared in his Budget Speech that the new tax arrangements were the most revolutionary changes yet made to Australia’s system of income tax. Despite the assertions of Opposition supporters, every taxpayer in Australia will benefit to some degree from these reforms. I repeat that every taxpayer in Australia who earned during this financial year the same amount as he earned last financial year will pay less tax. I defy members of the Opposition to dispute that proposition. I now deal with the taxation rates as they have been announced by the Treasurer. The first thing to note is that the rates are greatly simplified. There are now, in effect, four sections. The taxpayer earning up to $3,750 a year pays no tax. This is important to bear in mind when looking at the taxation rates beyond that amount. As my colleague. Senator Messner, pointed out in his speech last night this effectively reduces the taxation rate up to $16,000 a year which is set at 32c in the dollar when we allow for the fact that the first $3,750 of income is not subject to tax. Of course, overall an income up to $ 16,000 is taxed at a lower effective rate than the 32c in the dollar.

The second taxation scale is applied to incomes between $3,750 a year and $16,000 a year. Taxation is payable at a standard rate of 32c in the dollar. That applies to all incomes over $3,750 a year. This, of course, is the only taxation which is payable on incomes up to $16,000 a year. Over and above that amount, and up to an income of $32,000 a year, the taxpayer will pay additional tax of 1 4c in the dollar for that pan of the income between $16,000 and $32,000. Incomes above $32,000 a year will attract a further tax of 28c in the dollar above the 32c tax base. So on that portion of income over $32,000, these taxpayers will pay taxation at the rate of 60c in the dollar. One of the great problems with the previous scale of taxation or structure of the taxation system was that people at all tax levels lacked incentive. They lacked the incentive to work harder because of the vicious incidence of the taxation scale on the extra income earned. The grab of the taxman took from extra income and destroyed the incentive to earn or produce more. This is a matter which has worried the Government. It is vital in order to get the economy moving again that people must have the incentive to work. People were refusing to work overtime because it was just not worth it. It was costing them too much in tax.

In the last Budget the Government introduced tax indexation. That was a very significant reform which did something to cushion the effect of the problem I have been discussing. It meant that where a taxpayer received a rise in salary, that rise was indexed to the tax rate of the salary that he was getting immediately before the rise. But the reduced taxes introduced by this Budget give a very substantial relief to taxpayers across the whole range of incomes. Just as the family allowances introduced by the Budget last year were designed to assist people on low incomes, so in this Budget, by reason of the taxation exemption to $3,750 a year for a single taxpayer or in the case of a taxpayer with a dependent spouse, a taxation exemption to $5,480, some 225,000 Australians now paying tax, many of them being pensioners and young people, under our scheme will pay no tax at all. Yet we have Opposition senators coming into the Senate chamber and having the hide to suggest that this Budget will make regressive changes in the tax system. Surely those 225,000 taxpayers who are no longer paying tax will not agree with that proposition.

To further illustrate the point, if it needs further illustration, a taxpayer now earning, say, between $8,000 a year and $12,000 a year, which is a range fairly common today, can work overtime without becoming involved in paying a higher rate of tax. This is because there is a substantial margin for overtime payments, having regard to the fact that the taxation rate does not increase beyond 32c in the dollar until a ceiling of $16,000 is reached. Then, of course, the additional tax payable applies only to income above that figure. The effect of these substantial cuts in income tax will certainly give a substantial fillip to the economy. We find that the record of

Labor in government, as I have already indicated, was one of massive Budget deficits with an unprecedented 89 per cent increase in personal income tax revenue during its first two years of office. The Labor Government failed to acknowledge the need for tax reform by refusing to introduce tax indexation, even though it was recommended by the Matthews committee which was set up by the Labor Prime Minister. The tax reduction, of course, restores to the individual incentive for initiative and enterprise.

Before concluding my remarks about the taxation scene, I refer briefly to the position in relation to the averaging of income for primary producers. The reforms of the Hayden Budget attacked averaging by imposing an extra tax of $50m on farmers. In other words, the farmers who were subject to the averaging system lost taxation concessions of $50m. Our Government has taken steps not only to restore the pre- Hayden position but also to give substantial further assistance to farmers by abolishing the $16,000 ceiling and introducing a provision to enable farmers on falling incomes to pay tax at the lower rate of income, be it income applicable for the income earned that year or the income averaged over a five-year period. So, all primary producers now benefit from averaging and pay tax on actual income or average income earned over five years, whichever happens to be the lesser. The primary producers now have the best of two worlds.

I should like to make a few comments now about education. The Budget provides for Commonwealth expenditure of $2,371m on education for 1977-78. This is $21 lm or 10 per cent more than last year. Some criticism has been levelled at the Government because of its guidelines to the Schools Commission. It must be remembered that government schools in the States are funded in the ratio of 85 per cent by the States and only 15 per cent by the Commonwealth. It must be remembered also that funds for education flow to the States in a two-fold stream. The first is specific purpose grants under the Budget and the second is financial assistance grants under the tax sharing arrangements. In this context, I point out that this year under the tax sharing arrangements the States will receive $4,336m. That is an increase of more than $600m over 1976-77 and at least $100m more than the estimated entitlement to the States under the uniform taxation formula. The States at last are realising what a great boon the federalism policy of this Government is and how much it means to them in additional revenue. The allocation this year represents an increase of nearly 17 per cent over the last financial year. Relating it back to the context of education, to which I am addressing myself, it gives the States further capacity to increase their spending on schools if they so desire. Indeed one might comment that the situation of the States in balancing budgets and using available Commonwealth funds under the Commonwealth tax sharing arrangements is, I think, proof of the efficacy of the Government’s policy in this regard.

While commenting on the Government’s federalism policy, I might also mention the position in relation to personal income tax sharing in the case of local government. Here again, there has been a substantial increase in funds provided. In my own State of Victoria there will be an increase of $6.7m over and above the amount received last year. This is an increase of almost 19 per cent. Victoria will receive a total sum of $42.3m from the total allocation of $ 165.3m made available by the Commonwealth Government to local government throughout Australia this year. The favourable reaction of municipalities throughout my State, following the recent announcement of the amounts payable to each municipality under this legislation, is a clear indication that this aspect of the Government’s federalism policy is giving eminent satisfaction to the local government recipients of the revenue.

I note, with some regret, that there is no provision in the Budget relating to the alteration in the rates of Federal estate duty, nor has any further step been taken to abolish it altogether. The Victorian Government announced in its recent budget that probate duty in Victoria will be abolished from 1 January next in the case of estates passing to children. In its budget last year the Victorian Government effected a reform which meant that probate duty would not be paid on an estate passing between spouses. Because the amount of State probate duty paid is a deduction from the final balance before Federal duty is calculated, the benefits given by State governments such as Queensland and Victoriaprobate duty has already been completely abolished in Queensland and substantial total exemptions have been granted in Victoriadisadvantage the estates of people who were domiciled in those States. The estates of persons who were domiciled in those two States are disadvantaged so far as Federal estate duty is concerned when compared with the estate of a person who was domiciled in a State where exemptions do not exist. In other words, more Federal estate duty is paid on Queensland and Victorian estates. This is an anomaly that could and should be rectified. Furthermore, as has been pointed out on a number of occasions, the proportion of total Federal revenue derived from Federal estate duty has been declining. In the years 1974-75 and 1975-76 it was below 0.50 per cent and the estimate for the year 1976-77 is, I am informed, 0.33 per cent. The cost, of course, of collecting this tax is significantly higher than that of collecting income tax and other Federal revenues. A strong case can be made to abolish estate duty and, even pending abolition, I think a case can be made for the Government to set up a special committee to ensure that where an exemption from a tax or duty is given by a State legislature the person receiving the benefit is entitled to receive it in full, without being penalised by paying extra revenue in the Federal sphere. There are several other anomalies in this regard in relation to exemptions from payroll tax in State areas where, by reason of an exemption from payroll tax, the taxpayer pays more income tax so that the benefit given by the State is not fully effective.

Another area about which I wish to make some comments is the new arrangement announced in the Budget Speech for the pricing and taxation of crude oil produced from presently known Australian fields. The price in Australia is less than half the price in countries like Japan, France and Italy. Further, our Government has faced the realities of the situation caused by the quadrupling of international oil prices in 1973-74 which forced home to the world the key role which oil plays in transport and as an energy source. Because it is inevitable that demand will overtake supply in the foreseeable future- it is worth noting that President Carter’s forecast is somewhere in the mid 1980s- it is essential that government approaches the problem realistically so that steps can be taken to mitigate the effects of dearer oil. Oil supplies 45 per cent of the world’s energy needs and 47 per cent of Australia’s energy needs. It will remain, for some time, the most important energy source in Australia. Our central energy policy objectives are threefold: Firstly, we must encourage oil exploration and development; secondly, we must encourage greater economies of energy use and encourage people to use other fuels in preference to oil; and, thirdly, we must foster a more intensive search for alternatives to oil. Each of these objectives requires the price to be increased.

The previous Government announced- we have maintained it- a policy of applying import parity prices to oil discovered after 14 September 1975. The Treasurer (Mr Lynch) dealt with the position in detail in his Budget Speech. I propose to confine what I have to say to the problems which the announced policies will mean for people living outside the great capital cities of Australia. Undoubtedly, the new fuel excise and crude oil prices will create great hardship for country business people and primary producers throughout Australia. It will have a cumulative effect because apart from the direct cost to an individual for his fuel, travel, tractor work and other essential services on a farm property, there will be the indirect costs which higher transport charges will have on the whole range of essential goods and services which country people may require from time to time. Prior to 1972 our Government had a form of price equalisation which guaranteed no greater price for people in remote areas than 3.3c above what was paid in city areas. That was abolished by the Whitlam Government because it considered the scheme unnecessary. The reintroduction of some form of price equalisation to enable people in country areas to carry on their farming enterprises satisfactorily, and indeed to survive in today’s climate, is absolutely essential. I trust that our Government will appreciate the great hardship which is being caused to people in country areas by the recent increases in fuel prices and will take some action to see that country people are not disadvantaged by the increases.

The Budget also announced the intention of the Government to establish a rural bank, and that is good news for the primary producers of Australia. Apparently Senator Sibraa has some doubts as to whether the Government is going to redeem that promise, but I can assure mm that the Government will redeem its promise. The Prime Minister (Mr Malcolm Fraser), the Minister for Primary Industry (Mr Sinclair) and the Treasurer have all said that the legislation will be introduced during this session of the Parliament. For too long people in the primary production area have had to struggle against flood, fire, famine and high interest rates without the assistance of long term finance and repayment of principal. The provision of finance to assist the beef industry which has been announced since the Budget was brought down is timely and will do something to assist this important industry, which as we all know is experiencing one of its most troubled and difficult periods in the history of Australia.

The on-going finance provided by the Budget in respect of superphosphate and nitrogenous fertilisers will be welcomed by farmers throughout Australia, as will the provision of $6.5m to cover underwriting commitments to the dairying industry. The underwriting commitment is of vital importance, particularly in the States of Victoria and Tasmania, and has been of great assistance to the dairying industry in those two States. The Minister has announced that the underwriting arrangement for butter, cheese, skim milk powder and casein will be continued for the 1977-78 season. The sum of $47m provided by the Commonwealth under the rural adjustment scheme will also be of assistance to farmers, providing as it does a comprehensive package for debt reconstruction, farm build-up, farm improvement, rehabilitation assistance, household support and carry-on assistance. The income equalisation deposits scheme introduced in the previous Budget has proved to be a very successful initiative and will continue. The matters I have mentioned, together with the averaging scheme, will be of great assistance to primary producers in cushioning the effect of the wide variations in income from year to year that are occasioned by seasonal conditions.

I turn briefly to look at the position in relation to social welfare, which forms such a significant part of government expenditure. Here we find that there is a rise of 12.2 per cent to give a total allocation of $6, 345m, or an increase of $689m over the expenditure in 1976-77. It is noted that family allowances, a very valuable initiative introduced in the previous Budget, are paid universally and without a means test and amount this year to $ 1,049m. There has been an extension of the terms of eligibility for the handicapped child’s allowance to allow further assistance to low income families with the custody, care and control of substantially handicapped children. Those are just a few of the initiatives and the good things which are contained in this Budget. They will enable the Government to lead the people of Australia to a successful era, following on the disastrous three years of Labor Government.

In conclusion, I want to make a brief reference to some of the problems of the River Murray, the greatest internal waterway we have in Australia, which is of considerable significance to the States of Victoria, New South Wales and South Australia. I was fortunate during the recess to see at first hand some of the problems of the river during a two-day tour from Albury to Mildura with other members of parliament. We had the privilege of having the Minister for National Resources (Mr Anthony) with us for the two days. The tour was certainly interesting and educational and highlighted the very wide range of problems confronting the electors in the areas in the three States through which the Murray passes. First of all, the River Murray Commission is a statutory authority on which are represented the three States I have mentioned as well as the Commonwealth. I am sure there is a need to update and review the Commission’s statutory charter to give it some further authority and power to deal with the problems which inevitably arise from time to time along the river. The Murray Valley Development League, which is a voluntary organisation comprising representatives of organisations from the three States, has worked assiduously and tirelessly to bring the problems which arise in relation to the river before the government. It would appear to be the logical organisation to co-ordinate and spearhead a united approach to the governments concerned on the problems which the organisation knows so well. The Murray Valley Development League also has affiliations with municipalities and other bodies bordering the river and in effect acts as a co-ordinating body for a large number of interested organisations and persons in relation to the problems of the river.

This organisation is well worthy of the support of the Government, and I trust that the Minister for Environment, Housing and Community Development (Mr Newman), under whose ministry it operates, having seen the wonderful work which the League does and the problems which confront the organisations and persons in areas bordering the river, will recommend the reintroduction of the grant which was taken away in the previous Budget and has not been restored in this Budget. Such a grant would enable the League to continue its work. The principal priority of the League is the quality of water in the River Murray system, followed by a maximisation of regulated quantities. In addition, the League has worked for the enlargement of the powers and responsibilities of the River Murray Commission, to which I have already adverted. I might say that both the Federal and State governments have indicated that that question will receive early attention. I think there is also some indication in what has been said by the States and the Commonwealth that it will be favourable attention.

I want to make brief reference to the other problems confronting the landholders adjacent to the river. Some of those problems will be compounded by the release of additional water from the Dartmouth Dam in Victoria, which is nearing completion. The land immediately below Albury has particular problems in that regard, the seriousness of which is readily apparent upon physical inspection. There is no doubt that the impact of the additional water from the Dartmouth Dam into the Murray system will have to be watched closely and some action will have to be taken to cushion the effect of the extra water going into the river. One of the great problems is that the river is a natural stream, but because of the dams, the construction work, the irrigation work, all the things that have happened on the river over the centuries, it has more or less become a drain for artificial purposes and not a natural water course. The River Murray Action Group, which is an association of land holders occupying the riverfront rural land on both sides of the River Murray between the Hume Weir and Yarrawonga, made an excellent and comprehensive submission to the Minister covering all aspects of the problem.

The problems of the Barmah choke in the Barmah-Nathalia area also will be affected by the Dartmouth project. The Barmah and Milawa forests, which are on each side of the river, occupy some 60,000 hectares between Tocumwal, Barmah and Echuca. It is vitally important to the future of those forests that the summer flow be regulated to prevent flooding. If there were an excessive flow from the river through the sending down of extra water for irrigation purposes the red gum forests would be destroyed. Very valuable timber is produced on both sides of the river for building purposes. Between Echuca and Mildura and m the Swan Hill area the salinity content of the Murray River and the drainage problems that aggravate the salinity situation are matters of great importance to the future of the area. A great deal of wealth is produced in the irrigation areas that border the Murray River, particularly from vegetable growing, vine growing, fruit growing and dairying. It would be a tragedy for Australia if the salinity problem that has become far more manifest in recent years were not grappled with and solved. Time does not permit me to deal with the problems in any detail. Indeed, I have instanced only a few of the problems that are current along this great waterway, which is vital to the future of Australia. I am pleased that the Minister was able to spend two days looking at the problems of this vital waterway. It is trite to say that the Murray River is important to the future of the nation. I am hopeful that as a result of the very large number of submissions made to the Minister we will see some Government action being taken to grapple with the various problems.

I have been pleased to take part in this debate. I commend the Budget to the Senate as a worthwhile document and as a document which will build onto the solid foundation which was laid by last year’s Budget. With the implementation of” the provisions contained in this Budget, particularly the tax cuts, which is something to which I must return, the people of Australia will see an era of prosperity in the years that lie ahead.

Senator McLAREN:
South Australia

– The Senate is debating the motion that the Senate take note of the Budget Papers, to which the Leader of the Opposition in the Senate (Senator Wriedt) has moved the following amendment:

At end of motion add ‘, but the Senate is of the opinion that the Budget:

will intensify and prolong the recession;

will increase unemployment;

will have little impact on inflation;

d ) will make regressive changes in the tax system; and

will reduce living standards’.

My colleagues who have spoken before me about the Budget Papers have pointed out in some detail why that amendment was moved and have been able to show to the Senate the reasons why the Opposition feels that each of the categories listed in the amendment is necessary. Let us take them in sequence. The Opposition claims, firstly, that the Budget will intensify and prolong the recession. We know that that is exactly what is happening. On each day that has gone by since the introduction of the Budget the unemployment figures have increased and more and more people have found themselves out of a job. Paragraph (b) of the Opposition’s amendment also comes into this aspect. It claims that the Budget will increase unemployment. Of course, when one analyses the Budget figures, as I will be doing shortly, and looks at where this Government has cut down on expenditure one sees that the Budget can do nothing else but put people out of work.

The Opposition says that the Budget will have little impact on inflation. It means by that that the Budget will not reduce the rate of inflation. The Budget figures themselves prove, as I will point out when I refer to the increase in the fuel tax, that the Budget is in effect going to increase the rate of inflation because of the added cost the increased fuel tax will place on every commodity that is used by every citizen in this country. We go on to say that the Budget will reduce living standards. We know that that is true because as people find it harder and harder to find employment their living standards drop. People who are out of work and who have to live on social services find it very difficult to meet their commitments. We are faced with a great problem.

I listened to Senator Scott speak to the Budget Papers. In doing so- I think it might have been yesterday- he made great play about how the Government had reduced the deficit by something like $500m. Of course, it is well known that any housewife can reduce her household expenditure by cutting off many of the essential services that she is providing for her husband and children. Any housewife can do that by making them go without the essentials of life. That is the very way in which this Government has been able to reduce its deficit. It is not providing to the people who live in the community the services to which they are entitled and of which they became appreciative when the Australian Labor Party came to office and increased expenditure on them. Because we increased expenditure on those services we are being continually described as spendthrifts. We spent the money in areas of great need. I will refer to that later. I will point to specific areas of successive Budgets that have been put down in this place, particularly the area of education. In doing so I will give the lie to Senator Carrick ‘s repeated assertion in this Parliament that the Labor Government in fact reduced expenditure on education. He is playing on the use of a complete misnomer when he says all the time that we decreased expenditure on education. In fact, as the Budget figures prove, we made massive increases in education expenditure. We had to do that because the philosophy of previous Liberal governments had been that there should not be any education for the masses and that education should be only for the wealthy section of this community. By educating the masses one would be putting them on a parity with the people who can afford to send their children to private schools and afford to spend money on buying them books so that they can study at home. The working man’s family could not afford to do that.

Senator Baume:

– You are 100 years out of date.

Senator McLAREN:

-I will prove to Senator Baume by referring to the Budget figures that we had to provide massive increases in expenditure to bring education standards up to what the people of this country require, in particular the people in the lower standard of living group. As I have said, any person can reduce a deficit or reduce his budget expenditure by not providing essential services for his or her family. The very way in which this Government has reduced this Budget deficit has brought great hardship and suffering upon the children of working class families. The Government has little to crow about when it says that it has reduced the Budget deficit. Of course, the way in which it is doing so is by cutting down on its expenditure on all the essential services of this country.

Senator Baume:

– It is cutting taxes, too.

Senator McLAREN:

- Senator Baume said that the Government is cutting taxes. I heard Senator Tehan say a while ago that the Government had done a wonderful thing for the family man by increasing the family allowance. Let me tell Senator Baume that great hardship is being caused to a large number of people in this community because of the way in which the Government did that. The Government certainly increased the family allowance, but a husband cannot now claim a rebate in his taxation return for his dependent children. How does that affect a man who is separated from his wife or is divorced and has a maintenance order against him under which he has to provide so much for his wife and children? How does he get on? The very effect of the measure that the Government has brought in has been an increase in the maintenance payment to a mother and her children and a decrease in the wherewithal of the father himself to live. People come into my office daily with their income tax assessments to ask what can be done about this matter.

Senator Baume:

– That is a good point. You are quite right.

Senator McLAREN:

– What do these people have to do? I have explained to them that they will have to go back to their lawyers and spend money going back to the courts and seeking a decrease in the maintenance orders that they have had awarded against them. Will the Government help these people? Many of them are in poor circumstances because of having to keep two homes, as the saying goes. Will the Government provide financial assistance to these people to enable them to initiate a legal action m the courts and to go there and have their maintenance orders decreased? I will be very interested to hear the views of future speakers on that. I think Senator Baume has already spoken in this debate. He said that my point is a good one. No doubt he has had people in his office with the same complaints. I will be very interested to see whether the Government is going to assist these people to make an approach to have their maintenance orders reduced because they are suffering hardship.

Yesterday we saw lone fathers, some of whom have to stay home to look after small children, in front of Parliament House seeking some assistance. They are people who need some assistance. What has this Government done to assist those people? I can remember the Minister for Social Security (Senator Guilfoyle), when in Opposition, sitting where Senator Mulvihill now sits and repeatedly asking the Labor Government why we did not do something for the single parent, particularly the lone father. Now that she is in a position where she can do something, what is she doing? She has forgotten all about it. If it was good enought to make claims on a Labor Government to bring in some financial measures to assist lone fathers surely it is good enough for her to do something now because it is within her power. Surely, when she made the claims that we ought to be doing something about the situation she did some research as to the needs of these people. Why does she not now bring in some measures? Honourable senators opposite are in government. They have brought in two Budgets. Yet there is no mention of lone fathers in those Budgets; there is not a penny for those lone fathers. So there again we find honourable senators opposite, when in Opposition, calling on the Labor Government to do things and when they find themselves in a position to do something they neglect the very thing they criticised us for not doing.

I think it was Senator Baume who made some claims- I was not in the chamber to hear him but I was listening to him over the broadcasting systemthat the Liberal Party had him open an office or had him go into certain Labor areas to improve the Liberal vote. He said how he was able to do this. Then he made great play of the wonderful result his Government got in the 1975 general election. I should like to remind him of the percentage of votes the Liberal and National Country parties did get and the number of seats they got with that vote under the old system of election. In the 1975 election the Australian Labor Party polled 3,313,004 votes, or 42.8 per cent, and we won 36 seats. The Liberal Party polled 3,248,136 votes, or 42 per cent, that is, 0.8 per cent of the votes less than the Labor Party got, but the Liberals won 68 seats. That is 32 seats more than the Labor Party yet they claim a great victory. Let us look at the National Country Party. It polled 853,943 votes- 1 1 per cent of the vote- and got 23 seats. So there you have the democratic system.

Yet the other day in the other place the Deputy Prime Minister (Mr Anthony) when talking on an electoral matter cried crocodile tears about the terrible deal the National Country Party is getting under the new boundaries. He criticised his coalition partners for the terrible thing they had done to the National Country Party. Now the National Country Party has to go out and fight on its merits to gain support. It has been so used to coming into this place and holding the balance of power over the Liberals, holding the balance of power in the Cabinet, and saying: ‘If you do not do this, we will not support you. Then you will be out of government’. So the National Country Party gets 1 1 per cent of the votes but wins 23 seats, whilst we get 42.8 per cent and only 36 seats. So, comparing the figures, we find that the Labor Party polled nearly four times the number of votes of the National Country Party, yet we got only 13 more seats. Still National Country Party members cry crocodile tears that under the new legislation they have been given a raw deal. They are criticising their coalition partners because they refuse to amend the Electoral Act passed at a joint sitting of the Parliament which allowed only a 10 per cent tolerance in electorates. They want the tolerance put back to 20 per cent to keep them in office forever.

It is very funny that in this Parliament the National Country Party criticises the Liberals because they will not do certain things to that Party’s advantage; but when we look at what is going on in Queensland now what do we find? We find Mr Bjelke-Petersen talking on the radio yesterday. What was he doing to the Liberals? He was really working them over, telling the Country Party candidates to stand in every seat and to play his theme song, the Bjelke-Petersen Blues, I think it is called. He told those candidates to tell the people that they could not trust the Liberals who were opposing the Country Party in various seats and that the Liberals had to be defeated. Yet we have the coalition parties here saying that they are the people who can run the country. When they get back into their own little corners they fight like a cat and a dog shut up in a pen together. They cannot agree.

Senator Withers:

– Like the Labor Caucus.

Senator McLAREN:

– There is one thing that can be said about the Labor Party and that is that whilst we were never in government on many occasions, at least we governed in our own right. We do not have to put up with hangers-on to support us in government. Since I have been in this Parliament- for six years- and for many years before I came to this Parliament, the Liberal Party could not govern without the support of the Country Party. It got to the stage that even with the support of the Country Party the Liberal Party could not govern without those five Democratic Labor Party rebels who used to sit in this place. Of course the Liberal and Country parties led those DLP members up the garden path in 1975. They promised the world if they would help throw us out of office. But what happened? We saw the demise of all five of those members. They are all gone. They are finished. What a wonderful thing for this country! At least I give the Liberal Party this credit: It fooled the Democratic Labor Party and the country is now rid of the detrimental influence that those five fellows had on this country.

Senator Withers:

– And the Labor Party’s influence, too.

Senator McLAREN:

-Senator Withers will know that I pointed out here yesterday how we lost our influence in this Parliament.

Senator Withers:

– Through the ballot box.

Senator McLAREN:

– No, it was not through the ballot box after the 1974 election. It was through actions taken by a Liberal Premier in New South Wales and a Country Party Premier in Queensland who is now seeking re-election. It was the dastardly undemocratic action of those two Premiers that cost the Labor Party the numbers in this House and allowed you to refuse a Budget. If those two men had acted in a democratic fashion, you would not have been able to pull the trick you pulled and on the second occasion force the Labor Government out of office and force them to go to the people. However, you can gloat over the fact that you have the numbers in here and you can gloat over the fact that you have 68 members of the Liberal Party in the other place and 23 members of the Country Party. But the people are going to be able to judge you because when you were in government year in, year out for 23 years there were no guidelines for the people voting for the first time to allow them to compare a Labor government with a Liberal-National Country Party coalition. Now they have that situation. They had a Labor Government from 1972 to 1975 and they have had a Liberal-National Country Party government from 1975 to 1977. If we read the barometers correctly and if we can believe all the chit chat thrown around by various Ministers, unless those Ministers have been misinformed by their parties, there will be another election before Christmas and the people of Australia will be able to make a comparison: three years of Labor and two governmentsone of 17 months and another of about 18 months- compared with two years of LiberalNational Country Party government. I am sure that when the results go up on the tally board after the next election is held there will be a great difference. There will be no massive majority for the Liberals.

As I pointed out here yesterday, if honourable senators opposite lose government we will revert to the situation we were in when in office: the Liberal and National Country parties having the numbers here because we cannot get the numbers here. Then the country will be faced with a government frustrated by parties which will not admit that the people want a change. Senator Withers was on record- I referred to this yesterday- as saying that immediately after the 1 972 election the coalition parties set out to bring about the downfall of the Labor Government. They never even waited to see whether we could govern. Of course they would not allow us to govern. On every measure we brought up they were able to use some device in this chamber to prevent us from governing the country in the way in which it ought to be governed, in the way in which the electors wanted us to govern because of the policy we put to them. They did everything in their power to prevent us doing so.

Let us return to the Budget about which honourable senators opposite are making the claim that it is a wonderful Budget and that it has received the plaudits of practically every person in the community. I refer to an editorial in the National Times of 22-27 August, printed a few days after the Budget was brought down. In its analysis of the Budget it states:

With unemployment at 340,000 and climbing, Mr Fraser has chosen to provide tax concessions mainly to those with incomes over $12,000 a year while offering practically nothing to the jobless.

Now what do we hear? A few moments ago we heard Senator Tehan telling us what a great thing this Budget is doing by way of tax concessions. Senator Withers may try to wind me up, but I do not need any winding up. I have plenty of material with which to annoy him. He does not like it when somebody on this side of the chamber points out all the things the Government is doing to deprive the community of the essentials of life. All he wants to do is fool the people like he did in the election campaign of 1975 when he was playing the fairy godfather. The National Times is a creditable newspaper. Its articles are well researched. No doubt it had quite a lot of research done on the Budget. As I have pointed out, it states that the Government introduced taxation concessions for people on $ 12,000 a year and over. Of course we know that most of the work force in this country gets very little more than half that amount.

Sitting suspended from 5.46 to 8 p.m.

Debate interrupted.

page 1195

ESTIMATES COMMITTEES

Motion (by Senator Withers)- by leaveagreed to:

That the resolution of the Senate of 25 August 1 977 relating to the consideration of particulars of proposed expenditure 1977-78 by Estimates Committees be varied so that, unless otherwise ordered, Estimates Committees report to the Senate on or before Thursday, 13 October 1977.

page 1195

QUESTION

COCOS (KEELING) ISLANDS

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-On behalf of the Australian Labor Party I propose to move the Notice of Motion in my name that was placed on the Notice Paper on 9 March 1977 and which was on the Notice Paper for the previous Parliament when it was prorogued before Her Majesty the Queen opened this Parliament. I move:

That the Senate is of the opinion that the Government should, as a matter or urgency, make a statement to the Parliament on its policy concerning the Cocos (Keeling) Islands.

I say at the outset that having moved that motion I fully realise that since the motion was placed on the Notice Paper last March, during the recent parliamentary recess, namely about the middle of June of this year, a Press statement was issued by the Minister for Administrative Services (Senator Withers) setting out what the Government policy is so far as the future of the Cocos (Keeling) Islands is concerned. We of the Labor Party, despite the fact that that Press statement was made by the Minister, believe that this matter is of such importance that a ministerial statement should be made in the Parliament so that there can be full and ample debate on the matter of policy as determined by the Government.

It is not my intention to speak at length on this matter this evening because honourable senators will be aware that I and a number of my colleagues have from time to time, both while the Labor Government was in office and since the Labor Party has been in opposition, raised the problems of the Cocos (Keeling) Islands and the problems of the people of the Cocos Islands. Honourable senators will know that members of the Opposition have been concerned about the plight of the Cocos Malay population for a considerable time. I think we demonstrated during the course of our period in government that we were determined to end the state of feudalism that operates on Cocos by taking what we regarded to be positive initiatives that were attempted to be implemented by the Labor Government. I use the phrase ‘attempted to be implemented by the Labor Government’ advisedly because whilst we were able to do some things in an administrative capacity there were other matters that required parliamentary approval and because of the jamming of legislation at that time in 1975 by the Opposition when the government of the day did not have the numbers, in order to get action taken immediately or reasonably early we were forced to do things by the introduction of regulations rather than by legislation. In that regard although the Labor Government’s initiatives were thwarted by the Liberal-Country Party Opposition of the day we have not given up the fight for the rights and self-determination of the people of Cocos.

As I said earlier, I have spoken many times from this side of the Senate on the plight of the people of Cocos. I have questioned the Minister for Administrative Services, the Minister who is responsible to the Parliament for the Island Territories, pressing for changes that have been requested by the United Nations Committee of Twenty-four. I have raised the matter in Senate Estimates Committees in relation to aspects of compulsory education for children under 14 years of age and the replacement of plastic token currency with official Australian currency. I have raised the question of the introduction of just working conditions and wages in line with the International Labour Organisation conventions that Australia has ratified and I have raised the introduction of an effective form of local government and self-determination. In this I have been joined by my colleagues in the Federal Parliamentary Labor Party.

The Minister for Administrative Services as far back as April 1976, in response to a question from me shortly after he had visited the Cocos Islands, said on 27 April 1976 in the Senate:

I said whilst I was at both Christmas Island and Cocos Islands that I had gone there to look, to listen and to learn and that as a result of what I learned I would be making certain submissions to Cabinet. I said that when the decisions on those submissions were made by Cabinet an announcement would be made in the normal course. I do not think that a ministerial statement is necessarily the right way of doing this because there is a wide range of issues that would require separate and distinct Cabinet decisions.

The statement was made by the Minister for Administrative Services in the Senate as long ago as 27 April 1976- about five months after the present Government came into office. In the meantime I have placed on the Notice Paper questions concerning the proposed replacement of plastic token currency; questions on the introduction of a form of compulsory education; questions relating to the Cocos community fund; questions regarding the establishment of a form of local government in the area; and questions concerning health and hygiene so far as the Cocos Malay people are concerned. Eventually, shortly after the Parliament had gone into recess this year, namely on 16 June 1977, the Minister made a Press statement setting out the Government’s policy with regard to the Cocos (Keeling) Islands. During the course of that Press statement the Minister said:

The broad details of Australia’s Cocos policy are as follows: a representative form of local government for the Cocos community to be established with the ultimate aim being the creation of a fully elected body; arrangements to be made allowing a transfer to the Cocos community of the village area ofHome Island; the replacement of token money by Australian currency; establishment of a new form of fund to assist the financing of community activities’, there should be freedom of movement and communication within the Territory; the improvement of education and health facilities and general upgrading of living standards; the framing and implementation of laws which could be clearly applied and enforced, taking into account local institutions and customs; the progressive introduction of a wages economy appropriate to Cocos conditions; appropriate means by which Australian citizenship can be provided to residents of the Territory who wish to take up Australian citizenship; the provision of financial assistance to Cocos Malays who wish to move from Cocos to Australia; and the ownership by the Australian Government of all land on which its facilities are located.

I applaud the fact that the Government made that determination and that statement of policy although it was made by way of a Press statement. The statement of policy, as enunciated in the Minister’s Press release of 15 June, is practically on all fours with the statement of the Labor Government’s policy, as announced by me in the Senate on 10 September 1975 by way of a ministerial statement, when the Labor Government was in office and when I was the Minister responsible to the Parliament for the administration of the Cocos (Keeling) Islands. In my ministerial statement to the Parliament on 10 September 1975 I mentioned that the Government was seeking at that time the ownership of a suitably agreed area of land on Home Island to be vested in the Home Island community as a corporate entity. This would help to establish the community’s own identity separate from that of the Clunies Ross estate. I proposed also that a local government type of authority be established with l egal and formal status to manage and control the affairs of the community- this authority would comprise only members elected for a specific period and would have powers which reflected the wishes of the community; all future Australian Government contracts involving the

Clunies Ross estate provide for direct payment of appropriate sums of money in Australian currency to the Cocos community; a separate Cocos community fund be established for this purpose to be administered by and for the sole benefit of the community; the use of token money eventually be discontinued and replaced by Australian currency, taking into account the complexities involved; provision be made to issue local ordinances and establish better facilities for the administration of justice; health and education services be extended; rates of pay and employment conditions on Cocos aligned progressively with Australian practice and International Labour Organisation conventions; provisions be introduced to permit freedom of movement for members of the Cocos community and provision for granting Australian citizenship to Cocos Islanders born there before 1955 who did not apply for citizenship in the prescribed time with a view to making it easier for the citizens of Cocos to take out such citizenship if they wished to do so.

After comparing my ministerial statement in the Parliament on 10 September 1975 with the Minister’s Press statement of June 1977, it appears to me that at long last there is what might be termed a bipartisan policy between the Government and the Labor Party on the future of the Cocos (Keeling) Islands. Certainly it has taken the present Government some time to catch up with what the Labor Government set out to do in 1975. Having said that, I suggest that the Parliament is entitled to know now what the Government has actually done about initiating the stated details of its Cocos policy, as outlined in the Minister’s Press statement to which I have already alluded. A working party paper was prepared by the Secretariat of the United Nations General Assembly for the special committee on the situation with regard to the implementation of the declaration on the granting of independence to colonial countries and peoples in respect of the Cocos (Keeling) Islands. That paper is dated 2 1 June 1977. There are a number of matters set out in that working paper which was prepared for the information of the United Nations.

After reading the Minister’s Press release of June this year, I believe that certain things have to be stated for the benefit of the Australian community and for the benefit of the people of the Cocos-Malay community, the great bulk of whom are Australian citizens. For instance, one should ask what arrangements have been made to allow a transfer to the Cocos community of the village area of Home Island. If no arrangements have been made, what arrangements will be made? There is a commonality of policy between what the Minister for Administrative Services said in his Press statement of June 1977 and the Labor Government’s declaration of policy by way of a ministerial statement in September 1975. What steps are being taken by the present Government to establish a representative form of local government for the Cocos community whose ultimate aim would be the creation of a fully elected body? In September 1975 I announced to this Parliament that an interim local government organisation was being established by the Labor Government. That was announced in September 1975. That interim local government organisation was just starting to get off the ground when the Labor Government was dismissed from office two months later.

When one reads the report of the working party of the United Nations General Assembly on that aspect, one sees that mention was made of this particular aspect, the interim advisory council. Paragraph 13 of the working party paper states:

An Interim Advisory Council, established in September 1 975 to hold consultations with the community and to advise the Administrator, was to be replaced by a fully elected Council as soon as the necessary arrangements could be made. John Clunies Ross, the present owner of the islands, assumed control of the Clunies Ross estate some 27 years ago. He has objected to the establishment of the Council and has requested that it be disbanded.

If I might interpolate, this is in a paper dated 2 1 June this year. The paper continues:

The Council met three times in 1975- from September 1975 when it was established-and not at all in 1976.

Suddenly, in June, we are told, by way of a Press statement, that the Government is prepared to set out to achieve some form of local government in the Cocos-Malay community. That is just another aspect of the situation.

Senator Sir Magnus Cormack:

– What are you trying to tell us?

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– I am trying to suggest that it is about time a ministerial statement was made on this subject.

Senator Sir Magnus Cormack:

– You would have obtained that by asking one question instead of all this repetition.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-The Opposition has asked this question from time to time and it has been told, as I have tried to explain and as I thought I read clearly, that the Council met three times in 1975 and not at all in 1976.

Senator Sir Magnus Cormack:

– But everything you have said could have been put in one sentence.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

– Well it has not been put in one sentence. If the honourable senator wants to speak at some other time or on the adjournment debate, he is welcome to do so. I am entitled to debate this matter on behalf of the Labor Party and I intend to do so, irrespective of what you say or how you want me to say it. I remind Senator Cormack that while he might think he is still the President of the Senate, he is merely a backbencher in this place at the present time. The Parliament is entitled to know something about the type of funding activities that might be contemplated by the Government. When it was in government the Labor Party established a fund. It is still being operated but we are told by the Minister that another form of fund is to be established. Some $27,000 was in the fund at December 1976. We are told that another form of fund is to be established. We do not know what the new form of fund will be. We do not know why it is to be established. The original fund was established for the benefit of the Cocos community and at present has some $27,000 or $28,000 in it.

We are entitled to know what steps the Government has taken to ensure freedom of movement and communications within the territory and to improve education, health facilities and general living standards. In the most recent report of the Administrator of the Cocos Islands, under the heading ‘Wages’, we can see that the general living and working conditions have not changed at all. I think it is a matter of public comment that the Administrator mentioned that the plastic token by which the Cocos-Malay community is paid is worth about 40c of the Australian dollar. We want to know what the Government has done by funding and by other means to assist the islanders who wish to resettle in Australia. We believe it is time the Government made a statement on what should be done to replace the present form of currency that is used on the Cocos Islands with Australian currency. Plastic currency was used when we were in office. My colleague, the then Treasurer, Mr Hayden, issued an instruction to Mr Clunies Ross at the time that the use of plastic currency on that island was to cease. That sort of currency is still in existence. We believe a statement in relation to the timetabling of the abolition of the use of that currency should be set out.

I said as far back as August 1976 in this place that no other part of the world has changed as little as the Cocos (Keeling) Islands. I think, despite what was said by the Minister in his Press statement of June 1977, exactly the same is true today, more than a year later. Of course one has to refer only to the paper that was prepared by the United Nations General Assembly. I have already referred to paragraph 13 relating to local government. I refer now to the subject of business enterprises which is dealt with in pragaraph 30 of that paper in these terms:

Under arrangements initiated in 1975, the terms of such contracts provide that a proportion of the contract payment shall be paid into a Cocos Community Fund under the control of, and for use by, the islander community.

Now the Government tells us that it wants to change that form of funding. Paragraph 35 which deals with Australian currency states:

Although Australian currency is legal tender in the Territory, within the Home Island community, tokens (rupiahs) are used in transactions and for payment of wages. The tokens are not used by the islanders as a means of exchange in financial transactions outside the community. The estate converts tokens on demand to Australian currency. The estate at present values one rupiah at SAO. 40. Limited banking’ facilities are provided for Home Islanders by the Clunies Ross Estate.

With regard to social conditions, under the heading ‘Labour’, paragraph 37 reads:

To date, Australia has not made any declaration to the International Labour Organisation (ILO) in respect of the Cocos (Keeling) Islands on the conventions which it has ratified. A major difficulty has been the inability to give a guarantee of a practical compliance with the terms of the convention which each member of the ILO must supply. The administering Power acknowledges that some changes in community arrangements must take place before several conventions can be declared applicable.

Paragraph 39 of the United Nations statements provides under the heading ‘Educational Conditions’:

Attendance at the school on Home Island is not compulsory, but a child must attend regularly once enrolled. At 30 June 1976, 67 children were attending the school. Sixteen children were enrolled at the school on West Island.

We of the Labor movement when in government set out to change what we regarded to be the medieval way of life of these people despite the fact that they are few in number and are not a powerful lobbying group with any great or, indeed, any political sway. Whilst we are delighted to know that the Minister made a Press statement in June 1977 when the Parliament was not sitting setting out what the Government now believes to be its policy, a policy which appears prima facie to be bipartisan and consonant with the policy which we were attempting to initiate in 1975 when we left office, we still believe that the Government should be saying something in this Parliament about the proposed timetabling. We believe that Australia cannot afford the luxury of waiting for the many problems that exist there to settle themselves. As certain as night follows day that will not happen. Therefore, even though I place the motion on the Notice Paper as long ago as 9 March 1977, because the problems that exist in the Cocos (Keeling) Islands today are as apposite as they were when we left office in November 1975 and as they were when I gave notice of this motion, I now move:

That the Senate is of the opinion that the Government should, as a matter of urgency, make a statement to the Parliament on its policy concerning the Cocos (Keeling) Islands.

Debate (on motion by Senator Withers) adjourned.

page 1199

SENATE STANDING COMMITTEE ON SCIENCE AND THE ENVIRONMENT

Debate resumed from 25 August 1977 on motion by Senator Jessop:

That the Senate take note of the report.

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

-My colleague, Senator Mulvihill, was given leave to continue his remarks when the debate on this report was adjourned after it was presented to the Parliament on 25 August last. The matter relates to a report of the Senate Standing Committee on Science and the Environment and it is a review of the report of the Senate Select Committee on Air Pollution. If my recollection is correct, the Senate Select Committee was appointed in 1970 or 1971. A number of distinguished members were on that Senate Select Committee.

Senator Georges:

– Do not forget to mention me, will you?

Senator DOUGLAS McCLELLANDSenator Georges was a very distinguished member. The Senate Standing Committee on Science and the Environment made a very important detailed and interesting review of the report of the Senate Select Committee. We heard a detailed statement by the Chairman, Senator Jessop, on the matter. My colleague, Senator Mulvihill, was about to contribute substantially to that debate. I notice that Senator Mulvihill is now in the Senate. I yield to him.

Senator MULVIHILL:
New South Wales

– Not having copious notes, I must enter this debate on the burst. The broad thrust of the report that the Chairman of the Senate Standing Committee on Science and the Environment brought down can be compared with studying from a Mount Olympus type vantage point what has happened in regard to water pollution and air pollution. I do not think there is an honourable senator present in the chamber who has not served on a Senate committee from which indepth reports have surfaced. As a matter of fact, each time that the Senate Standing Committee on Science and the Environment has dealt with the Department of Environment, Housing and Community Development generally there has been some reference to the funding by the Australian Government of certain pollution monitoring appliances. However, when we look back at the vision contained in the reports of the Senate Select Committee on Air Pollution and the Senate Select Committee on Water Pollution, we see that notwithstanding the cross-fertilisation of parliamentarians who served on the committees, those committees believed in more Canberra participation than has occurred. I believe that we did alert the nation to the need for more effective control whether it be in respect of air pollution or water pollution. I know that my colleague, Senator Georges, had some very strong views about his State of Queensland. I will come back to deal with that matter in a moment.

But to all intents and purposes, what Senator Jessop in particular raised was the need to see the ideals that we visualised in the distance and how far we can go towards realising those ideals. The difficulty of the whole system was that the States belatedly realised their responsibility. It was only through reports such as this report that they were forced to bring in legislation to control such pollution. There are gaps in the legislation. I will cite one example and refer to Queensland. I was in Brisbane some time ago. I could not help but notice what was referred to as the best possible standards in relation to the cement industry- the high up-take chimneys. The standards were not as good as the standards imposed in New South Wales. I apply a very simple test to gauge the effectiveness of the standards. The people in the electorate of Macarthur growing stone fruit for home consumption do not get that silica dust on the outside of the fruit that collects on the fruit grown in some of the suburbs in Brisbane where I do not believe that the pollution control standards are as high. I raised this matter during the hearings of Senate Estimates Committee. I was told that whilst the Federal Government provides the funds for certain monitoring of the atmosphere, it is the State governments that actually administer the relevant legislation and apply the penalties where there is any wrong doing.

I was a member of a socialist delegation from this country that went to Japan not so long ago. We saw in Osaka and other cities certain highly sophisticated appliances. But I suppose that if we are realistic about air and water standards, the fact of the matter is that when it comes to rather hard economic situations bold leadership is needed. Perhaps it is necessary to go in boots and all in regard to environmental standards. I would be the last person to adopt a policy of appeasement in relation to pollution But I wish to illustrate a point more in the Japanese context than in the Australian context. We saw this highly sophisticated equipment in operation. The operator had a big console in front of him. He was looking at indicators that flashed red when a certain pollution reading was attained. But when we suggested to these people that perhaps they had reached the pollution saturation point and it may be better to shift the additional industry elsewhere, we noticed that a rather non-commital stance was adopted. It appeared to me that the situation was akin to the old chicken and the egg situation. The Japanese were prepared to bring in the industry and hope that they would be able to compress the existing pollution. I think this is accepted.

Certainly, Japan does not have a monopoly on this kind of difficulty. Sydney can experience this at times, as can San Francisco. But the main purpose of the observations made by the Chairman of the Senate Standing Committee on Science and the Environment was that we must have constantly a greater degree of co-ordination. I make a comparison between the standards applied in Brisbane and in Sydney in the cement industry. This position is not new. Anyone on our committee who has studied the various forms of pollution would know that there was a tremendous sort of industrial roulette between the various States in North America. For a while the same position applied in Australia. If one State became too hard as regards pollution controls, the threat would be: ‘We will take our industry elsewhere’. I think that for quite a while the American State of Pennyslvania found itself held at gunpoint virtually when it tried to get tough in this area. Of course, as the minimum pollution standards were raised to some extent and made more ironclad the position levelled out.

I can well recall the Tasmanian senator Peter Rae and his comments in respect to the report of the Water Pollution Committee. We noticed the position between governments of different political complexions- particularly Tasmania and Western Australia. There is no doubt at that time that some industries were prepared to do the right thing. But of course, even then, those industries may have been paying $100,000 for pollution devices while their competitors were not. This is the real crux of the situation in regard to what might be referred to as a legitimate tax deduction for a big organisation with civic pride. In comparison, I know, as I am sure Senator Missen knows, about the rural industries at Orbiston and the question of the paper mills. The plain fact of the matter is that the Senate Standing Committee on Science and the Environment was hampered in the taking of evidence because a regular controversy was going on. In fact, I think it finished in litigation in which the Melbourne and Metropolitan Board of Works was cited in relation to the question of who was polluting Lake Coleman. Lake Coleman is or was renowned for ideal trout fishing. I do not think the trout are there at all now or, if they are, they are present in very limited numbers. Our dilemma was whether or not we should endeavour to hear witnesses on the subject and pre-empt certain legal action in the courts of Victoria.

On the other hand, there is this problem upon which the Jessop report came out loud and clear. There is still a sort of reluctance on the part of some firms- they may be called multinational firms. For example, perhaps Britain and Canada have acted earlier in the field to combat certain forms of enviromental dangers and hazards. We find that firms establishing in those countries will do more to control pollution than they will in Australia. I can think of one firm in Britain which I think had a major plant in Lincolnshire. It was a copybook plant. All the standards were met to the full. I was there about five years ago. However, the same firm had a subsidiary company in Australia which, to say the least, was not pulling its weight in respect of the pollution problem. There are other examples of that. People such as myself have a certain concept of centralist government. It is not that we want to ride roughshod over the rights of people. But I believe that if the employer in the cement industry in BrisbaneI will use this example again- felt that his competitors had to meet a standard that approximated the standard in New South Wales and possibly South Australia, he would do so.

I know the argument is advanced that we will always reach the cut-off point. At what stage would we endanger the financial viability of the company concerned? At what stage would it mean that the company must reduce its work force? I think that there is one way in which we can approach this problem. Earlier today we were talking about coal being king in the next 10 years. Of course, it will cause some pollution. But I think it is accepted that the research over the last 10 years has been tremendous. A great deal has been done to reduce some of the previous environmental hazards associated with the use of coal.

Senator Sir Magnus Cormack:

– What about the ozone layer in relation to coal? Let us hear about that?

Senator MULVIHILL:

– I would be in a much better position to answer the honourable senator’s interjection if I could get better answers to my questions on this matter from the Minister for the Environment, Housing and Community Development (Mr Newman). I am awaiting answers to my questions. I never believe in entering an argument with only half my ammunition, particularly when I cross swords with the honourable senator. When I receive a few further responses to my questions, I will come back at the honourable senator like General Sheridan to whom I referred the other day. As I say, the idea of taking stock of the reports of various Senate committees is good. There are always gaps in reports. Personally, I feel that at times thrustful chairmanship by the responsible Commonwealth Minister does a lot of good. For a long time there was inactivity between the States and the Minister responsible for environment in a host of fields. In most of those fields, something has been done now. But if some States do not want to do anything about the pollution problem, they have the tendency to refer it to a subcommittee of Ministers. Often in the process, a State Minister moves from the environment portfolio or a State government changes its political complexion. Of course, we also get these changes in Canberra. We could be on the verge of another change in the not too distant future.

I believe that the idea of examining reports is very valuable. I think it is tremendously heartening to read various articles. I know that there is hardly a forest or conservation journal that has not referred to the monumental report that was produced in relation to woodchips. Of course, the moment we deal with any of these problemswhether it be woodchips or our next reference which concerns industrial research- we get back to the nitty-gritty of what we are doing about the vexed questions of water and air. I suppose imitation is the most sincere form of flattery. I think that when the Leader of the Government (Senator Withers) and his colleagues brought down the reports dealing with uranium it was remarkable. Amongst them was a statement of the view of the Deputy Prime Minister (Mr Anthony) in which he said: ‘For once and all we are going to clean up the Finniss River.’ I think Senator Sir Magnus Cormack would be well aware that I have hammered this subject and have blown my trumpet about the Finniss River and about how irresponsible we were in 1970 when the Atomic Energy Commission allowed the impregnation of the river with tailings which, again, made it desolate. I found myself standing shoulder to shoulder with Northern Territory cattlemenCountry Party members too- when we exposed this action in Darwin. It was one of those occasions when it was a great day. We exposed that situation. I think if all Senate committees had victories similar to that, the authorities would be alerted to problems that existed. It is not my desire to labour this point. I believe it is a quarterly or half yearly stocktaking which should be undertaken. There is nothing worse than a committee bringing down a report and feeling it has reached the millenium but then forgetting about it. I think that Senator Sir Magnus Cormack would know that from his own considerable military experience- I think it also applies in peacetime- that after high level bombing the ground forces have to be sent in to mop up. The same situation applies with the reports that have been brought down. Senators may start referring to next year’s Estimates and may ask Ministers what action they have or have not taken. It is amazing how that spurs them on. I simply say in conclusion that this watchdog role of committees was epitomised by the report that Senator Jessop and his colleagues presented. I think it has certainly vindicated the early pioneer work carried out into air pollution by illustrious senators such as the senator on my right, Senator Georges.

Senator GEORGES:
Queensland

– I take the opportunity to add to the remarks of Senator Mulvihill and to express my satisfaction with the report which was brought down by the Senate Standing Committee on Science and Environment about the very serious matter of air pollution. Our biosphere is approximately four miles, if it is taken vertically. If we were to measure four miles horizontally it would be about as far as Parliament House is from Civic. It is an atmosphere without which we cannot exist but it not such a great volume of air. We are doing much towards destroying it and any inquiry which is undertaken by the Senate, even though that inquiry may take place only every three years, is a worthwhile inquiry. I seek leave to continue my remarks.

Leave granted; debate adjourned.

page 1201

JOINT COMMITTEE ON PUBLIC WORKS

Debate resumed from 23 March 1977 on motion by Senator Roberson

That the Senate take note of the report.

Senator GEORGES:
Queensland

– The matter before the Senate is the report of the Public Works Committee tabled in the Senate on 23 March this year. Although there are a number of things I would like to say about this report I yield to Senator Kilgariff who, I know, is anxious to speak.

Senator KILGARIFF:
Northern Territory

– I thank Senator Georges. On 23 March I tabled the Fortieth General Report of the Parliamentary Standing Committee on Public Works. Honourable senators will know that six references were made to the Committee during 1976, including one reference which was subsequently rescinded. The Committee met on 13 occasions in 1976. These meetings were held to take evidence at public hearings, to carry out inspections and to undertake private deliberations. Meetings took place in Canberra on nine occasions, in Sydney on three occasions and in Melbourne on one occasion.

The various projects that were examined by the Committee are dealt with in Appendix A and Appendix B of the report. They included the development of a Navy supply centre and Army workshop facility at the defence establishment at Zetland in New South Wales; sleeping accommodation for the Women’s Royal Australian Army Corps at Puckapunyal in Victoria; the consolidation into Bankstown of the Bankstown and Lidcombe government aircraft plants; modernisation of facilities, stage 2, H.M.A. Naval Dockyard at Williamstown in Victoria, the primary school at Katherine South in the Northern Territory; the Supreme Court at Alice Springs in the Northern Territory; the central hospital services complex, stage 1, at Canberra in the ACT; the sewerage system at Katherine in the Northern Territory; the road to East Alligator River area in the Northern Territory and so on.

The report was also tabled in another place by Mr Kelly, the Chairman of the Committee. The report indicated that when reviewing the summary there was a noticeable time gap between the Department of Construction ‘s estimated date for the completion of the work and the date the work was actually completed. The average delay was nearly two years and was applicable to works both in the Northern Territory and elsewhere. It would be useful to have some response from the Government on the cause of these delays. It will also be noted that there has been an escalation in costs. However, as the note at the end of the summary points out, the Department of Construction has made no provision for the escalation of building costs, in accordance with Treasury policy.

The situation as outlined in this report is that the Public Works Committee was concerned that the average delay was some two years. During that two years, because of inflation and so on, there was a tremendous escalation of costs. The Committee was concerned that when taking evidence in the first place the cost of a project was said to be some $5m, for instance, but by the time it was actually completed the cost could have escalated to some $10m or $15m, as occurred in many instances. It was felt that a false impression was created in that while it was indicated that a project was going to cost $Sm no effort was made to anticipate what the cost of the project would be in one or two years’ time. That point has been pursued by the Public Works Committee and I expect that it will be further debated next week when the reports of the various Estimates Committees are tabled.

At the time this report was tabled in the House of Representatives and the criticism made by the Chairman, the Minister for Construction (Mr McLeay) answered the criticism on the two-year delay and indicated that there were many reasons why there should be an escalation in costs, one of which of course is inflation, and why there should be an extension of time. In many cases the extension of time has been due to the fact that the client department had made additions and amendments to the actual plan. In addition, during the relevant periods there had been strikes, shortages of material and so on. I believe that the reasons given by the Minister for Construction were sufficient to answer the criticism contained in the report.

Senator ROBERTSON:
Northern Territory

– My remarks will be brief, but I should like to make a few comments because of the implications for the Northern Territory. I have not had the advantage of Senator Kilgariff, who has been on the Public Works Committee, but I should like to join with him in drawing attention to the fact that there have been delays and the delays have been important for the people of the Northern Territory. The buildings and the roads that are being put down as a result of these investigations are an integral part of our system. The delays seem to occur in two major areas. The first is in the area of cutbacks in government expenditure. Works which have been recommended by the Public Works Committee have not gone ahead because finance was not available due to government expenditure cutbacks. The second reason I see is that there have been deferrals of some of the programs. Deferment is a technique that I have referred to previously in this place; a device for putting over to a later year some of the work which should be done in the current financial year.

A third area relates to the fact that reports have not been acted on. I draw attention to one in particular of which I have some knowledge, the primary school at Katherine South. At present Katherine South classes meet in old tin sheds at the agricultural showgrounds and have done so for a couple of years. That is not the fault of the Public Works Committee, it is the fault of money not being available. There is a great need for a school at Katherine South. It will meet a need in the community in the Katherine area and will be an integral part of the education system. I draw attention to another delay in work on the Kormilda College. The Kormilda College extensions were due to be finished in April 1975, according to the report. My colleague and I attended the opening of those extensions some two weeks ago. They were two years late. The Palmerston road, of course, is a hardy perennial in the Public Works Committee and perhaps some decision can be made on it in the near future. It has been looked at a number of times over the past few years, and some sort of road, although not necessarily the Palmerston arterial, is necessary to the Territory. I hope to see decisions made in these areas. The only other comment I should like to make at this stage is to draw attention to the cutbacks in government expenditure which have caused many of these programs to be deferred, and to the deferrals themselves, which have caused the projects to be put back further. In conclusion, I should like to commend the Public Works Committee for the amount of time it spends in the Northern Territory and for the quality of the reports which it brings down.

Question resolved in the affirmative.

page 1203

APPOINTMENT OF MR JUSTICE R. W. FOX AS AMBASSADOR-AT-LARGE

Ministerial Statement

Senator WITHERS:
Western AustraliaMinister for Administrative Services · LP

– by leave- In making this statement, I hope the Senate will understand that where I use the personal pronoun I am speaking on behalf of the Prime Minister (Mr Malcolm Fraser).

I wish to inform the House that the Government has decided to appoint Mr Justice Fox as Ambassador-at-Large for a period of 12 months. Mr Justice Fox’s primary role will be to represent Australia overseas in international endeavours to secure a strengthened nuclear non-proliferation regime. He will represent the Government at international forums and in other initiatives dealing with nuclear non-proliferation and nuclear safeguards.

Mr Justice Fox was the Presiding Commissioner of the Ranger Uranium Environmental Inquiry established by the previous Government. After the Inquiry completed its final report in May 1977, Mr Justice Fox, on my request, pursued inquiries overseas relating to nuclear non-proliferation and safeguards. He has recently returned from this overseas visit during which he consulted more than 200 peoplerepresenting overseas agencies and individual interests-in various countries, amongst others the European Economic Community countries, Sweden, Austria, Brazil, the United States, Canada and Japan, regarding safeguards against nuclear weapons proliferation and has reported to me on those discussions.

I regard Mr Justice Fox’s advice as important in enabling the Government to pursue the most effective policy against the spread of nuclear weapons, which is a matter of great international concern, and the most effective arrangements to remove the international instability associated with the spread of sensitive nuclear technology. It is clear from what he has told me that there is developing a greater international awareness of the importance of preventing proliferation of nuclear weapons. There are many international initiatives being developed in which Australia must be prepared to play its part. One of the most important is the International Nuclear Fuel Cycle Evaluation which is being undertaken on the initiative of the President of the United States. It will evaluate all parts of the present nuclear fuel cycle with the aim of strengthening technology against diversion of nuclear materials to weapons use. It will also examine how the nuclear power industry might best be structured to procure this result and to operate in the safest possible manner.

Mr Justice Fox as AmbassadorAtLarge will be leading the Australian delegation to the opening meeting in Washington on 1 9 and 20 October of the International Fuel Cycle Evaluation. Mr Justice Fox’s leadership will ensure that Australia will contribute to the international fuel cycle evaluation to the maximum extent that its international position and technical expertise in nuclear matters will permit. He will also give policy advice to the Government respecting bilateral safeguards agreements and on the nonproliferation aspects of commercial contracts for the sale of uranium.

Mr Justice Fox, with his background and experience in this field-so well demonstrated by the breadth and quality of the reports of the Ranger Uranium Environmental Inquiry- has indicated that he is prepared to accept this task, a task which is most important for Australia. The appointment demonstrates the tremendous concern which the Government has for problems relating to nuclear weapons proliferation and its determination to do everything possible to ensure the safest possible safeguards arrangements around the world. The Government greatly appreciates the Judge being able to make himself available for this most important international endeavour and is grateful to His Honour for accepting this appointment.

In accordance with past practice where members of the judiciary have been appointed to executive offices- for example, the appointment of Mr Justice A. E. Woodward, when a judge of the Australian Industrial Court, to be DirectorGeneral of Security, Sir Owen Dixon, then a Justice of the High Court, to be Australian Minister to the United States and Sir John Latham, while Chief Justice of the High Court, to be Australian Minister to Japan- the Government proposes to introduce legislation to enable Mr Justice Fox to retain his judicial status and the rights which attach to that status while Ambassador-at-Large. The Government also proposes to introduce legislation to increase the number of judges of the Australian Capital Territory Supreme Court from three to four to allow the Court to operate as necessary at its present strength during the period of Mr Justice Fox’s appointment as Ambassador-at-Large. His Honour has advised me that, particularly having regard to the administrative nature of his duties as Chief Justice and indeed the doubt that this assignment will be completed within a year, he proposes to resign as Chief Justice.

Senator WITHERS:

-I move:

That the Senate take note of the statement.

Debate (on motion by Senator Wriedt) adjourned.

page 1204

QUESTION

JOINT COMMITTEE ON PUBLIC ACCOUNTS

Debate resumed from 24 March 1977 on motion by Senator Baume:

That the Senate take note of the report.

Senator GEORGES:
Queensland

-In speaking to this motion I say that I appreciate the great difficulty that the Joint Committee of Pubuc Accounts must have had with this reference. I commend it for bringing down a fairly detailed report on a very complex matter. However, I cannot allow the report to be brought before the Senate without making one or two comments on it. The report concerns certain events that took place in the Department of Aboriginal Affairs during the time when Mr Gordon Bryant was the Minister for Aboriginal Affairs and, as one of the members of the Australian Labor Party’s subcommittee on Aboriginal affairs, I became very involved at that time in certain activities of the Department. The Public Accounts Committee, following a report of the Auditor-General, undertook an investigation that in large measure referred to certain activities that were carried out in the Torres Strait Islands by a concern called Applied Ecology.

I refer to paragraph 21 of the report in Chapter 2 at page 9, which reads:

When the inquiry opened there seemed to be a difference of opinion as to who took the initiative in persuading the Auditor-General that he should carry out an investigation into the financial administration of the Department. It was stated in the departmental submission that is was not the Department’s understanding that the examination had resulted from a request by the then Minister as had been stated publicly (allegedly by Mr Bryant according to newspaper reports of 6 and 7 March 1974.) The submission went on to state that the initiative in having the intensive investigation carried out, leading to the presentation of the Auditor-General ‘s report, was taken by the Permanent Head (Mr Dexter). It was claimed in the submission that Mr Dexter had called on the Auditor-General on 7 September 1973 of his own volition and expressed his deep concern about the financial administration of the Department.

The Minister at that time, Mr Gordon Bryant, contests that and I am in a position to support him. Mr Gordon Bryant had become very much concerned with certain aspects of the Department’s activities and he took certain steps. One of those steps was to appoint me, together with Mr Ray Thorburn, who was then a member of the House of Representatives, to the Board of the companies concerned, the main one being Applied Ecology. I do not want to go back over this matter. I think honourable senators have heard enough about it. We had a fairly wide ranging debate on it, which led to quite a deal of recrimination. I became a Director of this Board and at its first meeting I became concerned about certain things. On 23 August 1973- that is, before the date of 7 September 1973 that is stated in the paragraph of the report to which I have referred-I wrote the following letter to the Attorney-General:

Mr dear AttorneyGeneral,

Recently I was asked by the Minister for Aboriginal Affairs, the Hon. Gordon Bryant, to become a director of the Applied Ecology company and two associated companies.

I had previously expressed concern to the Minister about the formation of these companies, their structure and their proposed funding by the Government. I had also expressed concern about the management and operational methods used in the turtle farming project but I decided that I could best serve the interests of the Government by accepting the directorship and by giving advice and assistance to correct the grave errors which were apparent to me.

The letter continues:

As a Director of the company, at its first meeting I became alarmed at the articles of association and began to question my own position on the Board and the position of other Directors. I would appreciate your advice not only as to the position of the companies but also my own position as Director. There have also been brought to my notice allegations of misuse of public money and I would like to discuss these allegations confidentially with you.

That was on 23 August 1973. Subsequently I had an interview with the then Attorney-General. Also present was Mr Harders of the AttorneyGeneral’s Department. If I recall correctly he was the head of the Department. In the discussion that followed it was considered that it was not a matter for the Attorney-General to investigate, that if the allegations were serious enough it was a matter perhaps for the Commonwealth Police, but that surely it must in the first place be a matter for the Auditor-General. It was in that way that the investigation by the AuditorGeneral was commenced. That resulted from a letter that I wrote on 23 August 1 973.

It seems apparent to me that Mr Dexter became aware of this communication and the subsequent meeting and then took quick action to bring the matter before the Auditor-General. I have said some hard things about Mr Dexter. I do not intend to go over that area of the past, but I shall make a mild comment at this stage. If I had not written that letter and if the matter had not been brought before the Attorney-General’s Department, which subsequently referred it to the Auditor-General, I doubt whether Mr Dexter would have taken the initiative. But at all times the then Minister was aware of the correspondence that I had written to the Attorney-General. So let me make it clear to the Senate that it was this initiative that brought about the inquiry which subsequently brought down the recommendations with which we are all familiar.

Let me turn quickly to another matter. The Committee- perhaps it was as much because of my lack of initiative as for any other reason- did not see any need to call me before it. Perhaps I did not press it because by that time I had perhaps become frustrated after a long period of some 14 months in endeavouring to bring to the notice of the Parliament the distortions which had occurred in the Department of Aboriginal Affairs and in particular in the Torres Strait. I spent some 14 months of my time as a director of a company endeavouring to bring some sort of order into a concern which had been promoted beyond reason, if I may put it in that way, as was subsequently proven by the Auditor-General and I think supported by this report brought down by the Public Accounts Committee. The report states that I had been elected as chairman and that some 14 months later I had resigned. Perhaps an inference could be taken by those who read the report.

Senator Messner:

– Could you give us a reference, Senator?

Senator GEORGES:

-Yes, I will in a moment. In any case, it merely indicates that I became chairman of the Committee and some 14 months later resigned from the Committee. The report says that there was a period, a vacuum, in which the operation and activities of Applied Ecology suffered. At this stage I merely want to place on the record the reasons why I resigned. I found it impossible to continue as chairman for a variety of reasons. It seemed to me always to be a difficult position to be in to be a member of this Parliament and a chairman of a company which was funded by the Government to carry out certain work. I was put there as chairman in a sort of caretaker position. I was running into difficulties with the Minister for Aboriginal Affairs at the time- my colleague Senator Cavanagh. The position became untenable. But it is necessary for me to say that during the period of my chairmanship the company’s financial arrangements were brought under control. The extravagances of which the company had been guilty under the directorship of Dr Bustard had been corrected.

I want to read from the minutes of the first annual general meeting of Applied Ecology which was held at Parliament House, Canberra, on Tuesday, 24 September 1974. It was held here for the convenience of members of Parliament. I shall read out the vote of thanks to the retiring chairman of directors. I resisted the request to remain on the board. The vote of thanks needs to be placed on the record because recently there has been some criticism involving me and certain decisions that I made. I believe there is a move to allocate some blame to me which in some way will explain the continuing failure of the project. My belief is, and has been from the very commencement, that the whole project of farming fauna, especially turtles, was ill-conceived and likely to fail and that the many millions of dollars that have been poured into the project will be wasted. Honourable senators will note in the recent Budget Papers that the allocation of funds for the project is continuing. But it is now being said that the fact that nothing really has been achieved can be attributed to certain decisions taken by me while I was chairman. One of those decisions was to release the many hundreds of ailing turtles that were being held in the most unsanitary and, if one might use the expression, most inhuman conditions in turtle farms in the Torres Strait. In any case, I read into the record the motion moved by the new chairman of Applied Ecology, Mr Smart, and seconded by Mr Furzer, a new director. It reads:

VOTE OF THANKS TO RETIRING CHAIRMAN OF DIRECTORS

Following proposal by Mr Smart and seconding by Mr Furzer a vote of thanks was passed to the retiring Chairman of Directors, Senator G. Georges. Mr Smart referred to the Senator’s excellent work and personal sacrifices on behalf of the Company, especially during the re-structuring phase, and said that the Directors and shareholders were particularly grateful to the Senator for the present good position and standing of the Company.

I feel that ought to go into the record. Another matter is referred to in the recommendations at the end of this report. This is the last comment I wish to make because I do not want to open up the whole of the debate on this sorry matter. I just refer to one of the recommendations which says that any company which is set up in this way should be under the supervision of the AuditorGeneral at all times.

Senator Messner:

– On which page is that, Senator?

Senator GEORGES:

– It is the recommendation in paragraph 67 1 on page 258. It reads:

The Committee is concerned that the operations of projects such as the turtle and crocodile farms were conducted so as to remove them from the scrutiny of the AuditorGeneral’s Office. The Committee is strongly of the view that all Government-owned companies should be subject to the scrutiny of the Auditor-General. The Committee is also of the opinion that consideration should be given by the appropriate authority to the question of a possible conflict of interest developing for officers of departments who are appointed directors of such companies.

Of course in this particular case that would include members of Parliament. I expressed my concern early in the piece to the AttorneyGeneral of the time. I was also concerned that there was no proper supervision of such projects by the Auditor-General. I trust that the Committee will see that this recommendation in particular is carried out in future by a variety of companies, in particular those which have been set up by the Department of Aboriginal Affairs. I strongly support this recommendation. But to bear out just how strongly Mr Thorburn, Mr Neill and I considered this proposition, without the advice of the Public Accounts Committee, I refer the Senate to resolution 2F of the board of directors meeting on 12 October 1973. It was resolved early in the piece that the shareholders of the company be asked to agree that the AuditorGeneral be given permission, subject to the approval of the appointed auditors, to have access to the books and documents relating to the operation of the company since its establishment. That was a decision we took without the benefit of the advice of the Public Accounts Committee back on 12 October 1973. Any person responsible to this Parliament, especially someone elected to this Parliament, who becomes involved in this area must see immediately the need for the Auditor-General to have such access not only for the protection of the operation but also for his own protection.

Senator Wright:

-Why does government money when placed in the capital of a government company escape the scrutiny of the Auditor-General?

Senator GEORGES:

-Up to that stage it had not been under the scrutiny of the AuditorGeneral. If it had been, the errors that developed might not have developed. The AuditorGeneral’s report laid some of the responsibility on the Australian National University and in particular it placed responsibility on the Department. The first Auditor-General’s report strongly emphasised this. The Public Accounts Committee is to be commended for bringing down its recommendation.

Senator Wright:

– But why at the present time is it thought that those moneys escape the scrutiny of the Auditor-General? What excuse has he for not reporting on these matters?

Senator GEORGES:

-By establishing companies of this sort the Department took away from the normal scrutiny of the Auditor-General expenditure of certain moneys. We wrote a letter to the appointed auditors of this company. It might be interesting to read the response from the auditors. We wrote to them on 26 November 1973 regarding access to company records by the Auditor-General. The auditors were Nixon and Partners, Arthur Young and Co., chartered accountants with offices in all States and in London- a very reputable firm. We informed the auditors of the resolution and they said to us:

Dear Sir,

Re: Access to Company Records by Auditor-General

We thank you for your letter of 2 1 st November, 1 973 and note that the shareholders of Applied Ecology Pty Limited have resolved that the Auditor-General be given permission, subject to the approval of the appointed auditors, to have access to the books and documents relating to the operation of the company since establishment.

May we first express our surprise that the permission to the Auditor-General depends on our approval. If this requirement is just a courtesy paid to us we acknowledge it with due thanks.

On the other hand the members might have made this permission subject to our approval for some specific, although unspecified, reason and in case this is the situation we will give a qualified approval for the following reasons: -

Articles of Association usually places the responsibility of keeping the books and records on the directors and specifies that inspection of these records is not open to a member (not being a director) except as conferred by statute or authorised by the directors or by the company in general meeting.

Provided your articles contain similar provisions to table A’ it would seem to us that the company in general meeting or the directors may allow any member to inspect them.

With my lack of accountancy knowledge and with my lay experience, it seems to me that by setting up these companies under these sorts of provisions the responsibility of supervision has b een taken away from the Auditor-General and can be given back to him only by some resolution. What the Public Accounts Committee is saying is that that ought not to be so. That is exactly what I am saying- it ought not to be so. I think Senator Wright is implying the same thing.

Senator Wright:

– I am expressing surprise that anybody can excuse the Auditor-General from scrutiny of public money even when it is converted into shares. I would like you to show me what justification there is in the Audit Act for that excuse.

Senator GEORGES:

– I am afraid Senator Wright will have to ask the Auditor-General that. On my cursory reading of the Public Accounts Committee report- Senator Messner might be able to advise us on this- the Committee actually did that. I said at the time that the setting up of this three-tiered structure of companies to receive large amounts of money from a department was very questionable. Our Acting Chairman was a member of the Public Accounts Committee. I do not doubt that he is of the same opinion. It seems to me that after all this time we have reached the conclusion that the setting up of companies of this sort is to be viewed with some concern and caution, especially if large funds are provided. The Department of Aboriginal Affairs is funded to the extent of some $ 1 30m a year. If in the early stages it was not properly equipped to handle that sort of money in a normal departmental way, perhaps it ought not to have been allowed to set up companies to disburse this money.

Another thing appears in this sort of operation when a company is given $ 1 m in a year. I am not just using that figure as an exaggeration. That is the amount of money that was provided to Applied Ecology in one year. Large amounts of that money were then deposited in banks in interest bearing deposits. At the end of that year the budgetary requirements of the company for the next year were asked for and the company, in spite of having substantial funds deposited in banks, made an application for further funds based on a previous allocation. It seems to me that rather than the Auditor-General being separated from this scrutiny he ought to be looking at such matters much closer than he would look at normal departmental activity.

Perhaps I have gone round and round in expressing my concern. I said three things. The first was that in fairness to the Minister at the time, Mr Gordan Bryant, it was his initiative indirectly, and I think I have proven so, that set the AuditorGeneral into operation. In some way I have tried to justify my own role by reading the resolution from the minutes of Applied Ecology, and I have brought up this very important matter of the supervision of the money of companies or foundations of this sort. There was a conflict between the head of the Department and the Minister which broke out into this rather shabby public exhibition where we had for the first time a Minister appearing before the Public Accounts Committee in direct conflict and contradiction with the head of the Department. It was not a happy episode for the Minister at the time. I have a great sympathy for the Minister or for any other Minister who is likely to find himself in that situation. Ministers of government expect to have complete loyalty from the heads of their department. They do not expect to be frustrated. They do not expect non-co-operation.

In fairness to Mr Dexter, he was caught in a situation of serving two masters- the Council for Aboriginal Affairs of which he was a member and also the Minister. He played one against the other. In so doing he found himself in a position of conflict with the Minister who must accept full responsibility with the Parliament. If there is an implied criticism of Mr Bryant here, I think it is an unjust one. The Public Accounts Committee, of course, would not be aware of how the situation developed. It is very difficult, after accumulating such a mass of conflicting facts and such a dialogue of error, to be able to come down with a report which would really give full justice to the innocent. I believe Gordon Bryant was a very sympathetic Minister and I think the report accepts that.

Senator Baume:

– Does the report acknowledge it?

Senator GEORGES:

– It acknowledges it. I think also that in an area of grave neglect, he was perhaps over-sympathetic. That, of course, is understandable. He has been accused by the head of his own Department of lack of cooperation and consultation. In my experience that is not true. He used his own colleagues within his own Party, by way of a committee, and involved them in the everyday and week to week decisions he arrived at. He had a very substantial responsiblity to carry out the policy of previous government and of the Labor Government to correct the deprivation suffered by the Aboriginal people. Following previous Ministers he endeavoured, with substantial funds which were given by government, to correct the situation quickly. In endeavouring to correct the situation quickly perhaps he may have fallen into error. I do not think he did. When one endeavours to do things so quickly there are always those who will come to see just how much they can gain for themselves. There is no doubt that certain people ripped off the system. In particular, there were whites who ripped off the system. The money was readily available. Consultancy was over-used. Moneys were recommended to people who were not properly equipped to use those moneys. They fell into error and more damage than good was done.

If honourable senators have the time to read the report I ask them to pick up those criticisms and recommendations of the Committee. I ask them to recollect that other Ministers had difficulty with the Council of Aboriginal Affairs. In particular, I recall that Mr Wentworth, who endeavoured to do in his own way what Gordon Bryant subsequently endeavoured to do, had difficulties with the Council. I think the previous Minister, Mr Howson, found the same difficulties. Gordon Bryant certainly found those difficulties. There is one common denominator in all this. One must say that that common denominator was Mr Dexter. I commend the Public Accounts Committee for the long inquiry which extended across a couple of Parliaments. The character of the Committee changed; the membership of the Committee also changed. It must be very difficult for a committee with a changing character to carry out a long investigation of this sort. What this investigation reveals and what it recommends are sufficient to justify the work of the Committe. I commend the Committee for it.

Senator MESSNER:
South Australia

- Mr Acting Deputy President, I feel totally inadequate in standing to speak on this report in view of the fact that you are in the chair having occupied the chairmanship of the Joint Committee on Public Accounts for so many years during this inquiry. The Minister for Social

Security (Senator Guilfoyle) is present in the chamber as well.

Mr ACTING DEPUTY PRESIDENT:

– The Minister was also a distinguished member of the Committee.

Senator MESSNER:

– She was also a member of the Committee. I am afraid I became a member of the Committee at the final stages without having had the benefit of hearing the evidence at first hand. Nevertheless, I think that only highlights the tremendous difficulties the Committee had in forming its opinions of the report.

I want to comment on a couple of matters mentioned by Senator Georges and to make the point, which emerged by way of interjection from Senator Baume, that the Committee report does comment upon the good intentions of Mr Bryant in undertaking his activities as Minister. I believe that Senator Georges has made that point quite clear. The other issue concerns a matter which Senator Georges also raised. It is the key recommendation of the report and it was made quite clear in the statement of Senator Baume when he laid the report on the table. Item 8 on page 7 of that tabling statement reads:

The Committee is strongly of the view that all Government owned companies should be subject to the scrutiny of the Auditor-General.

Senator Georges made that point extremely clear and I believe it is a point for the Government to undertake and examine very quickly. Senator Georges made the point that Applied Ecology Pty Ltd was, in fact, not subject to the AuditorGeneral and employed private auditors to investigate its affairs. I can understand that that firm of private auditors, which was appointed by the Directors and shareholders of the company and, in this case, the Government, saw its duty as being determined by the articles of association of Applied Ecology Pty Ltd. Consequently, it did not read its duty to extend beyond the examination of the affairs of the company itself. In other words, the source of funds was not a question which would have exercised the auditors’ minds. That stems from the fact that Applied Ecology Pty Ltd was a body corporate, incorporated with a separate legal status and acting as a foreign company, I believe in Queensland. Naturally, therefore, there would not have been any legal requirement for the Government to appoint the Auditor-General to examine its affairs. On the other hand, the Government could have done that instead of appointing an independent firm of auditors to do that. I do not express that as a firm opinion but it seems to me that that could have been possible in the circumstances. Nevertheless, it did not occur in that particular case.

That, then, raises the question of whether or not it would be a good future practice for the Government to adopt, when it undertakes investments in private companies, to appoint the Auditor-General as the auditor of that company rather than a firm of independent auditors. That may be the simple way of getting around what may be a legal difficulty, to which, I think, my learned colleague from Tasmania has referred. I certainly am in no position to comment on the legal position in respect of the Auditor-General ‘s responsibilities. Suffice it to say that the Public Accounts Committee report was a long and difficult exercise and I believe the Senate has received it in the spirit in which the report has been prepared, one of construction rather than destruction.

Question resolved in the affirmative.

page 1209

SENATE STANDING COMMITTEE ON CONSTITUTIONAL AND LEGAL AFFAIRS ON OUTSTANDING REFERENCES

Debate resumed from 20 April 1977 on motion by Senator Missen:

That the Senate take note of the report

Senator DEVITT:
Tasmania

-I do not wish to speak very long on this matter. My principal reason for rising is to afford an opportunity to the Chairman of the Senate Standing Committee on Constitutional and Legal Affairs to bring the Senate up to date with the latest developments in regard to the activities of that Committee. I point out that, when I took the adjournment of the debate on this report on the day of its tabling, 20 April last, I did so on the basis of my understanding that it was a matter of considerable importance and one which the Senate, if it so wished, should have an opportunity at some stage to debate. I expressed the view here the other day that we are prone to move a motion to take note of virtually every paper that is presented. Some papers are not of very great importance at all; others are of quite considerable importance. I think they all get put into a common pool, as it were, and the significance of some of the more important reports which are produced tend to be lost or not to be elevated to the measure of importance which I think they deserve. 1 believe that the Senate ought to be informed on this Committee’s activities. It is a committee which has a continuing function. It surely is not sufficient for this Committee or any other committee of the Senate to accept a reference to carry out its functions of examining a particular matter placed before it, tabling a report and then nothing further being heard of the matter. Unfortunately that tends to be one of the deficiencies, as I see it, of one of the committees with which the Senate is jointly associated with the House of Representatives. I was recently at a meeting of the Joint Standing Committee on the Australian Capital Territory. The deficiency in the procedures followed by the Committee was highlighted when the Committee desired to institute some follow-up action in regard to a report which it had furnished to both Houses of Parliament. It was a very important reference. A lot of time was spent on it. I guess that a lot of money was spent on it also. One of the deficiencies in the procedures of that Committee is that after accepting its reference, carrying out its inquiries into the subject matter and tabling its report, the matter ends. That ought not to be the end of the matter. It ought virtually to be the commencement of it. The tabling of the report is the stage at which the Parliament becomes aware of what the Committee has done.

I think we all acknowledge and accept that in the last decade in this Parliament the committee system has developed. This is particularly so in the Senate. The committee system has developed to a stage where the Senate can justify its existence. Formerly in my view there were some very serious doubts whether the Senate- I know that this is arguable and that we can get debate going very quickly on the subject- was performing the sort of function which accorded with what its significance in the parliamentary system was represented to be. We developed the committee system. It is a very good one. I think the Australian community must be very grateful for what has been done by the various committees that have been established. Tremendously important subjects have been canvassed. Some extremely valuable reports and recommendations have been put to the Parliament

I have been very happy in my life in this Parliament, which is drawing to a close fairly shortly, to have participated in the work of many of these committees. I have always felt that somehow or other I have been able to justify my presence here through the interest I have been able to show and the small contribution I have been able to make. We make corporate sorts of judgments in these committees. They tend to transcend party lines so often. An individual member is able to make his own contribution, based upon his own judgment and his own experience in the past, to add to the value of these committees.

I return to the remarks I made earlier in relation to the need to follow up the reports which various committees make to the Parliament. We are dealing at the moment with the Senate Standing Committee on Constitutional and Legal Affairs which has a number of references before it. I think it is appropriate that an opportunity should be taken from time to time for it and other committees of its kind to acquaint the Senate with what is happening, to highlight if necessary any deficiencies in the system and to make recommendations for improvements in procedures for carrying out the various recommendations which the Committee has made from time to time.

I certainly hope that Senator Missen, who I understand is to follow me, will highlight one deficiency which came to light recently in relation to the publication of Australian Law Reform Commission reports. That Commission has been set up, as the name suggests, to collate information in regard to law reform and to put it into some readable and available form for people who are interested in this area of human activity. I was very unhappy recently to find that there was some difficulty in the printing of certain of the Law Reform Commission reports due to lack of funds. That may have been overcome. There may also be, of course, some problems in relation to the availability of sufficient staff to enable compilation of these reports, the collection of them from all round Australia and their documentation in a readable, readily accessible and available form. Perhaps I should content myself with saying that. I am pleased, as I said earlier, that the procedure we follow here enables the Parliament as it ought and as it is proper to be informed of what committees are doing and to enable every member in this chamber if he or she feels that there is some area in which he or she can highlight a deficiency or in fact make some suggestion to add to the strength of the work of the committee to do so. I will content myself with those comments and look forward to whatever contribution the Chairman of the Committee Senator Missen may make.

Senator MISSEN:
Victoria

– I am indebted to my colleague, Senator Devitt, for the opportunity to speak. I do not propose to canvass the other references which the Senate Standing Committee on Constitutional and Legal Affairs has at present but to content myself with this report and the items in it, one of which has some updated information which I think should be made available to the Senate. When this report was put down in the Senate on 20 April this year I commented on the various matters that the report covered. Some of them, such as the number of annual reports that the Committee had studied and other matters in regard to the Trade Practices Commission, do not call for any further comment at this stage. Two matters arose out of the investigation by the Committee of the annual report of the Australian Law Reform Commission under Mr Justice Kirby. One matter which arose from the annual report of 1976 was the problems associated with the implementation of law reform. The Senate subsequently made a reference to the committee covering that item. That matter is under the immediate examination of the Committee.

The second matter referred to in Mr Justice Kirby ‘s annual report was the preparation of an Australasian digest of proposals for law reform. This is a matter that I think ought to be drawn to the attention of the Senate tonight. The annual report of the Australian Law Reform Commission detailed a history of a particular aim, namely, to collate throughout Australia the various items of law reform over a period. A great deal of work done goes unrecognised. There is also some duplication through the country. This country is not so rich in brains and ideas that it can afford to ignore and not bring to notice those ideas as they come forward. Some of them are made in comments by judges. Others are made in learned articles. Still others are to be found possibly in statements made in the Parliament. They might indicate reforms that ought to be kept closely under attention.

The matter goes back to about 1970 when this proposal for a digest on law reform was advanced. I will not detail the early history of it but in February 1970 the Standing Committee of Attorneys-General wanted to establish this official list of work being done on law reform. After the establishment of the Australian Law Reform Commission the same Standing Committee of Attorneys-General in 1976 made the Commission responsible for this compilation and distribution of the official list of information about activities of law reform agencies. That list was to date from 1 January 1976. The work was undertaken by the Law Reform Commission. Quite a considerable amount of work has been done in getting the material together. The annual report to which I have referred pointed out that there had been before that no organised national attempt to collect these ideas. It was stated that a more wasteful use of highly paid legal talent could not be imagined or a system better designed to promote lawyers’ indifference to the inequities and injustices of the legal system could scarcely be designed. These points have been made many times over.

The progress on the digest proceeded until in the annual report of 1976 Mr Justice Kirby pointed out that the great bulk of the work on it had been completed and the manuscript was then awaiting publication. That was where difficulty came about. It did not appear to be a manuscript which it would be economic or profitable to print privately. Great difficulty was encountered in trying to find someone who would publish it. The Senate Standing Committee on Constitutional and Legal Affairs wrote to Mr Justice Kirby. On 1 March 1977 he informed us that the digest had not yet been published. The manuscript had been then standing for the better part of a year and only needed certain work before it could be published finally. The problem was finance. The Committee in this report finally recommended that if the Commission was unable to find a publisher for the digest, the Government should provide the Commission with funds sufficient to enable it to publish the digest and update it at regular intervals. It is important that it should be not only produced once but also revised constantly so that it is useful to all people.

I think it is significant for the Senate to realise that since that report has been made, a clear arrangement has been made for the publishing of this digest. The Australian Government Publishing Service has now agreed to publish the digest, although the Law Reform Commission has had to provide part of the funds from its own budget. That is clearly going to be done. Unfortunately, there is another side to the picture. The Law

Reform Commission had requested the Public Service Board to allocate two more staff positions to the Commission in order to produce the digest speedily. It is important that the digest should be published at an early date and be worked on regularly. Unfortunately, the Public Service Board has rejected this request. When one bears in mind that since this request four different additional matters have been referred to the Australian Law Reform Commission for its intensive investigation, one will appreciate that unfortunately the digest has had to be given a much lower priority than the Commission would like. The Commission now anticipates the publication date will be August 1978. That is it will be the best part of nine months from now before it is seen. When one bears in mind also that the work has been practically finished for already a year or more, I think that this is regrettable. I hope the Public Service Board might reconsider this matter so that, having overcome what appeared to be the main problem of having the digest published, having the Australian Government Publishing Service agree to this, we can ensure that it is published and kept up to date, and therefore achieve the real benefit of having a digest for the whole of Australia.

I think that they are the only matters I wanted to bring before the Senate. I believe that they are important and I hope that the Government and the Public Service Board will take note of these matters so that we can gain the most benefit from this Australasian digest.

Question resolved in the affirmative.

Senate adjourned at 9.55 p.m.

page 1212

ANSWERS TO QUESTIONS

The following answers to questions were circulated:

Television: NSW Country Centres (Question No. 438)

Senator Button:

asked the Minister representing the Minister for Post and Telecommunications, upon notice, on 30 March 1977:

  1. 1 ) What television transmitter and translator sites does the national television service share with stations operated by Country Television Services, Orange, and Television New England Ltd, Tamworth.
  2. Who originally established these shared facilities and at what cost.
  3. Of the sites originally established by either of the two commercial operators, how many were later acquired by the Postmaster-General’s Department (and now operated by Telecom Australia).
  4. How much were the commercial operators paid for each of the facilities acquired by the Postmaster-General’s Department.
  5. How much has the Postmaster-General’s Department and Telecom Australia paid out since to upgrade and maintain the facilities including access roads and mains power feeds.
  6. How much were the commercial operators charged for each shared site in 1976.
  7. What does it cost Telecom Australia to maintain (a) main transmitter sites and ( b ) translator sites.
Senator Carrick:
LP

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

  1. The national television service shares the following transmitter and translator sites with Country Television Services Ltd, Orange and Television New England Ltd, Tamworth.

Television New England Ltd- Mt Dowe transmitting site, Middle Brother transmitting site, Armidale translator site, Glen Innes translator site, Gloucester translator site, Inverell translator site, Walcha translator site.

Country Television Services Ltd- Mt Cenn Cruaich transmitting site, Cobar translator site, Kandos translator site, Mudgee translator site, Nardoo translator site, Nyngan translator site, Lithgow translator site, Portland translator site.

  1. –

At Lithgow, the national television service leases the building from Country Television Services Ltd for $400 p.a. while other facilities at the site are not shared.

  1. Certain facilities at 1 1 locations were originally established by the commercial stations and, in accordance with usual practice, were later acquired by the national television service.
  1. Repairs and maintenance expenditure is not recorded separately for individual items.
  2. Television New England Ltd:
  1. Site maintenance expenditure is not recorded separately for transmitter or translator sites. Expenditure during 1976-77 on repairs and maintenance of sites, associated buildings and masts for the National Broadcasting Service was $324,000.

Apprenticeships: Australia Post and Telecom Australia (Question No. 697)

Senator Colston:
QUEENSLAND

asked the Minister representing the Minister for Post and Telecommunications, upon notice, on 28 April 1977:

  1. 1 ) In what trades have apprentices been employed in (a) Telecom Australia, and (b) Australia Post, since 1 July 1970.
  2. By Branch, for each year from 1970 to 1976, what was (a) the total number of apprentices employed and (b) the total number of first-year apprentices engaged for (i) Telecom Australia, and (ii) Australia Post.
  3. In 1977, what is (a) the total number of apprentices employed and (b) the total number of apprentices engaged in each Branch of the Department for (i) Telecom Australia, and (ii) Australia Post.
Senator Carrick:
LP

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

  1. 1 ) From 1 July 1970 to 30 June 1975 the employing authority was the Australian Post Office. Since 1 July 1975 Telecom Australia and Australia Post have existed as separate authorities and employers.

Apprentices have been employed in the following trades by the Australian Post Office and/or Telecom Australia and Australia Post from 1 July 1970:

Blacksmith

Bodymaker

Carpenter

Cook

Cycle Mechanic

Diesel Mechanic

Electrical Fitter

Electrical Fitter and Mechanic

Electroplater

Fitter

Fitter (Diesel)

Fitter and Turner

French Polisher

Instrument Maker

Locksmith

Motor Mechanic

Painter

Panelbeater

Painter and Signwriter

Plumber

Refrigeration Mechanic

Sheet Metal Worker

Signwriter

Spraypainter

Structural Steel Tradesman

Telecommunications Tradesman

Upholsterer

Watch and Clock Maker

Welder

Wood Machinist

  1. and (3) This information is not available by Branch. The statistics are recorded as at June of each year for apprentices employed and over financial years for first year engagements.

Council of Egg Marketing Authorities (Question No. 1112)

Senator Colston:

asked the Minister representing the Minister for Primary Industry on 16 August 1977:

With regard to the Council of Egg Marketing Authorities:

how many meetings of the Council have been held in the past five years;

For each meeting in (a):

What was the venue;

How many delegates attended;

C) What expenses were incurred by delegates in:

fares,

accommodation;

meals, and

other;

What other expenses were incurred by the Council of Egg Marketing Authorities; and

What other expenses were incurred by any other government department or authority and what are the details.

Senator Cotton:
LP

– The Minister for Primary Industry has provided the following answers to the honourable senator’s question:

  1. and (b) The following information has been provided by the Council of Egg Marketing Authorities of Australia, the Australian Egg Board and the Department of Primary Industry.

Civil Rights of Slovene and Croatian Minorities in Austria (Question No. 1136)

Senator Mulvihill:

asked the Minister representing the Minister for Foreign Affairs, upon notice, on 16 August 1 977:

Will the Minister advise what action has been taken following presentation of a petition to the Senate on 25 May 1977 (Hansard, page 1332) concerning the civil rights of Slovenes and Croatians in Austria.

Senator Withers:
LP

– The Acting Foreign Minister has provided the following answer to the honourable senator’s question:

It will be recalled from the Foreign Minister’s reply to Question No. 1 1 3 (Hansard, pages 549-50 ) that direct diplomatic negotiation is the preferred manner for solution of disputes under the State Treaty for the Re-establishment of an Independent Democratic Austria, to which Australia is a signatory (Australian Treaty Series 1961 No. 14). With this consideration in mind, and since the question of the status of the Slovene and Croatian minorities has not been proposed for inscription on the agenda of any UN body this year, action by the Australian Government along the lines sought in the petition presented by the honourable senator would not be appropriate at this time.

Vietnamese Refugees (Question No. 1225)

Senator Devitt:

asked the Minister representing the Minister for Immigration and Ethnic Affairs, upon notice, on 1 8 August 1 977:

  1. 1 ) What is the present status of Vietnamese refugees who recently arrived illegally in Australia.
  2. What is the Government’s attitude to these people.
  3. Have they been, or will they be, given Australian citizenship.
  4. If they are to remain in Australia, where will they be accommodated, and what action will be taken to assimilate them into the Australian community.
  5. 5 ) What are the sources of income of these people.
  6. What is the Government’s attitude towards the offers made by State Governments and community organisations to provide accommodation and sustenance for these refugees.
  7. Is there a likelihood of a continued substantial influx of refugees from Vietnam.
  8. What is the Government’s attitude to people from other countries who enter Australia under similar circumstances.
Senator Guilfoyle:
LP

-The Minister for Immigration and Ethnic Affairs has provided the following answer to the honourable senator’s question:

  1. 1) The group of 47 Vietnamese refugees who arrived on 12 July 1977 have been issued with temporary entry permits valid to 22 November 1 977.
  2. The Government’s attitude, having established that the people concerned are genuine refugees, is expressed through Australia’s international obligations as a party to the 1951 Geneva Convention on the Status of Refugees. Those in this group seeking permanent residence are being considered in line with this approach.
  3. Australian citizenship is normally available to permanent residents of Australia after residence of at least 3 years if they apply and satisfy the requirements of the Citizenship Act.
  4. The 47 arrivals were initially offered accommodation at the Commonwealth Hostel at Graylands, Western Australia. Two of the group are receiving hospital treatment and one is staying privately with a friend. Those in the hostel are receiving English instruction and orientation and, as required, will be assisted in finding other accommodation and employment.
  5. Refugees receive special Social Security benefits until family breadwinners obtain employment.
  6. The Government is appreciative of the assistance provided by State Governments and by voluntary agencies through their involvement in reception arrangements. It also acknowledges the offer made by the Tasmanian Government to accept a group of refugees in that State. Possibilities for resettling refugees in Tasmania have been discussed by Commonwealth and Tasmanian Government officers.
  7. Australia is committed to the acceptance of a regular flow of refugees from Vietnam. Cambodia and Laos commensurate with our capacity to absorb them. Officers of my Department currently in Thailand are making arrangements for regular movement commencing in mid-October.
  8. Australia’s involvement in the acceptance of genuine refugees is not limited on the basis of nationality or race. A distinction should be drawn, however, between refugees and those who, not being refugees, seek to evade normal entry requirements.

Australian Film Commission: Sir Garfield Barwick (Question No. 1226)

Senator Douglas McClelland:
NEW SOUTH WALES · ALP

asked the Minister representing the Minister Assisting the Prime Minister in the Arts, upon notice, on 1 7 August 1977:

What are the full circumstances of the equity investment by the Australian Film Commission of $73,710 to Sir Garfield Barwick for the production of a documentary film entitled The Reef, (Senate Hansard, 3 June 1977, p. 2083).

Senator Withers:
LP

– The Minister Assisting the Prime Minister in the Arts has provided the following answer to the honourable senator’s question:

Sir Garfield Barwick originally approached the Australian Film Development Corporation on behalf of the Australian Conservation Foundation in August 1974, at a time when the honourable senator was the Minister responsible for the Corporation. Acting as a member of the Foundation, Sir Garfield sought financial assistance for a project intended to further the aims of the Foundation- that is, a documentary to be produced by Mr John Heyer and introduced by His Royal Highness, the Duke of Edinburgh, on the subject of the Great Barrier Reef.

Following his original application, Sir Garfield authorised Mr Heyer to take over negotiations with the Commission on the basis of a revised application.

At the outset, Sir Garfield clearly indicated his intentions to act in the interests of the Foundation (of which he had been President) by assisting in raising funds from both private and public sectors, in addition to a direct contribution from the Foundation, in order to have the film made. The Australian Film Commission, successor to the Australian Film Development Corporation, finally approved an investment in this project in August 1976 after having assessed its merits as a commercial proposition. The Producer by then had assumed carriage of negotiations with the Commission. The sole beneficiaries of any funds received from the film are to be the Producer, the Australian Film Commission and the Australian Conservation Foundation.

Tertiary Education Commission and Schools Commission: Funding (Question No. 1245)

Senator Mcintosh:
WESTERN AUSTRALIA

asked the Minister for Education, upon notice, on 23 August 1977:

  1. 1 ) What indexes, projected or actual, have been applied to (a) base capital and (b) base recurrent programs for 1977-78 in each sector of the Tertiary Education Commission and each program of the Schools Commission, to arrive at the estimated total of $75 million provided for cost supplementation of grants made by these bodies in the financial year 1977-78 (Financial Tables in Budget Statement No. 3-Estimates of Outlays 1977-78).
  2. How will the $75 million estimate be apportioned among capital and recurrent programs of each sector of the Tertiary Education Commission and the Schools Commission.
Senator Carrick:
LP

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

  1. The 1977-78 Budget includes $75m for cost supplementation of the programs of the Education Commissions. For the most part the budgetary provision in 1977-78 relates to the second half of the 1977 calendar year programs of the Education Commissions. Both capital and recurrent components of grants to be provided under the 1977 programs of the Education Commissions will be subject to cost supplementation but from 1978 supplementation will be limited to increases in respect of the wages and salaries components of recurrent grants only.

The Budget estimate of $75 million is based largely on forecast movements in costs in 1 977 in respect of the relevant categories of recurrent and capital expenditure. The particular forecasts concerned are based on a number of assumptions and, in line with usual practice, are not detailed in the Budget documents. They are, however, broadly consistent with the prospective movements in prices and wages, which are described in more detail than in the past, in Statement No. 2 attached to this year’s Budget Speech (see in particular pages 36-37).

  1. As indicated in answer to part (1), both capital and recurrent grants under the 1977 programs of the Tertiary Education Commission and the Schools Commission will be supplemented for price and wage increases in 1977-78. The precise amount of supplementation will be determined on the basis of expenditures and actual movements in indexes which have been developed by the Commissions.

Public Broadcasting Licences (Question No. 1262)

Senator Button:

asked the Minister representing the Minister for Post and Telecommunications, upon notice, on 25 August 1977:

  1. 1 ) Has the Minister received any requests to provide public broadcasting licences; if so, what requests have been received.
  2. Does the Minister intend to call for applications for public broadcasting licences; if so, when.
  3. What procedures must be followed by applicants for public broadcasting licences.
  4. When will the Broadcasting Tribunal conduct hearings on applications for public broadcasting licences.
Senator Carrick:
LP

– The Minister for Post and Telecommunications has provided the following answers to the honourable senator’s question:

  1. 1 ) Some requests are directed to me and some to my Department. An up-dated list of requests received is as follows:
  1. The availability of frequencies for public broadcasting stations depends, to a considerable degree, on plans for the development of VHF-FM broadcasting. It is expected that the Government will announce its policy for such development in the near future. Applications for some public broadcasting station licences will be invited shortly thereafter.
  2. The procedures set down in the Broadcasting and Television Act, 1942.
  3. Within a month or two of its receipt of applications referred to in (2) above.

Citizen Band Radio: Interference with Television Reception

Senator Carrick:
LP

- Senator Archer asked the Minister representing the Minister for Post and Telecommunications the following question, without notice, on 6 September 1977:

The interference caused to television reception in many places through citizen band radio has now become so prevalent that some television stations have begun broadcasting instructions to viewers on how to combat the problem. Does the Minister agree that it should be the responsibility of the citizen band radio users? Will the Minister take up the matter with his colleague with a view to having the problem rectified by those responsible for causing it?

The Minister for Post and Telecommunications has provided the following answer to the honourable senator’s question:

Yes, in fact the operating conditions for Citizens Radio Service stations provide that adequate measures shall be taken to minimise the risk of interference to other services and that any station causing interference shall cease transmissions until effective corrective action has been taken.

Cite as: Australia, Senate, Debates, 6 October 1977, viewed 22 October 2017, <http://historichansard.net/senate/1977/19771006_senate_30_s74/>.

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