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Tuesday, 30 October 1956

Mr WARD (East Sydney) .- The House and the people of Australia have just listened to an extraordinary speech. ] think they will agree with me that it was a speech unfitted for this occasion. If Australia were looking for a comedian the speech would have been very fitting, and the Prime Minister (Mr. Menzies) would have been fully qualified to make it. Anybody who has heard the Prime Minister to-day would imagine that the Australian economy, . after seven years of mismanagement by this Government, was in such a sound position that it did not require any defending. What is the situation? During the whole of the Prime Minister's speech the right honorable gentleman did not deal with the vexed questions of import controls and the effect that they are having on our economy. What has happened to our balance of payments problem, to which our attention has been so often directed? As a matter of fact, it is an important point to keep in mind that the Government-

Mr Peters - The Prime Minister is leaving the chamber. He is running away.

Mr WARD - lust as he always runs away from every issue. It is important to keep in mind that the Government intends to close the Parliament, at the end of this week, for five months so that the voice of the people in the Labour Opposition will be stilled at a time when, we are facing a critical situation in this country. The Government cannot escape that fact. Let us consider what' the Prime Minister had to say in reply to the Leader of the Opposition (Dr. Evatt), leaving out all the stale jokes that the Prime- Minister cracks from time to time. The Prime Minister said that the. Labour Opposition wanted a return to. wartime controls. That is untrue. There were many controls' which were found necessary in war-time that no Labour man would ever think of imposing in peace-time. But what we do ask is that some controls should be applied to those people who to-day are exploiting, the Australian community by making excess profits. It is. rather interesting to note that the Prime Minister tries to imply that the particular type of control for. which, the Labour Opposition is asking is. a control that will prove irksome to the worker.

I remember that the right honorable gentleman himself, in 1951, talked about excess profits. In comparison with what is being achieved to-day by these various monopolistic concerns, the profits of 1951' could' be regarded as being at a moderate level. In 1951 the Prime Minister was himself talking about imposing controls on excess profits and the Treasurer (Sir Arthur Fadden) was in agreement that there should be controls on excess profits, lt was only after they had fooled a section of the people into believing that they intended to take some effective action, and were returned at the head of a government, that they repudiated those speeches, just as they have repudiated many other promises to the Australian community. The Aus- tralian Labour party wants control of profiteering. We want control of profiteers, and we make no apology for asking for that control, to be imposed.

Let us examine the Prime Minister's speech. He talked about the relationshipof profits and dividends to the capital employed in the industry. The Labour party prefers to approach this question from, the: viewpoint of the profits made and the dividends paid' upon the actual" capital subscribed and invested', in the industry. aid' that is an. entirely different matter. Trie shareholders'' funds to which Government- supporters frequently refer include undistributed profits and watered capital accu mulated' by means- of bonus' shares for- which shareholders do not- contribute a penny, to that way, Government supporters keep the true picture from the Australian community. Why did not the; Prime Minister tell us whether he thought that General MotorsHolden's Limited had been unduly exploiting the Australian community? On one year's operation, that company- made a profit equivalent to. 550- per cent, on its ordinary capital. That fact was not mentioned in the Prime Minister's speech. It was referred to by the Leader of the Opposition, but not one word came in reply from the. Prime Minister.

Let us examine the question of whether this is a low-wage government. The Prime Minister said that it is, to the advantage of the workers to have their basic wage determined, not according to the needs of the worker, but according- to the capacity of industry to pay. If the workers were receiving a wage commensurate with the labour that they contributed to industry and commensurate with what the industry could afford to pay, it might be a horse of a different colour. But upon what evidence does the Commonwealth Arbitration Court determine the ability of an industry to pay' Can the wage that an industry can afford to pay be determined without taking into account the dividends that the industry can afford to pay? The Prime Minister said that the workers of Australia should be thankful to those great monopolies, irrespective of what profit they earned, because they provided employment for the workers. I submit to any honorable member who wants to approach this question fairly that if the profiteers were to disappear overnight, as long, as the workers remained in industry, we- would not notice the disappearance of a profiteer; but if the. worker, ceased to work in the factory and man- the machines the whole economy of the nation would come to a standstill. It is the workers in industry- who produce the wealth of a nation - the wealth that is of so much benefit to many sections of the community. Therefore, the Labour party makes no apology for attacking the Government on the present unsatisfactory state of affairs.

The Prime Minister actually spoke for nearly three quarters of an hour and did not blame the Communists for anything

It: must be. an historic occasion because, in the past, everything that happened in the country, was. due to the- Communists and their activities. But this time the Prime Minister has not submitted that as a defence. He has probably realized that that explanation has worn a little: threadbare; What is- the economic situation of- this nation? I have a copy of a- statement made by the Treasurer, who ought to know the state of affairs in Australia. Last year, we had. an adverse: trade balance, and- our overseas reserves, were reduced- by £73,000,000. They would have been reduced by an even greater figure had. the Government, not been able, to raise a-, number of loans overseas and attract the investment- of overseas capital in this country. If the Government had. not done that, we would, have been in a much more, serious position. But borrowing overseas, or inviting foreign investors to invest their capital, in- Australian industries, is, only a way of staving off the evil day; because, annual interest payments have to be made and dividends have, to go overseas to. foreign, shareholders. It is generally recognized that if foreign borrowings are carried too far they can result in serious difficulties and embarrassment for the people of this country.

What does the. Treasurer say is the present situation? The Leader of the Opposition presented an excellent case to show exactly what the situation was in Australia. But grave as the situation has been painted, it has not been, stated to be as grave as. the Treasurer himself has stated the position to be. The. Prime Minister declared not long ago that it was the. determination of the Government to. achieve. trade balance by 30th June of this year. There is no doubt in the world that honorable: members must- be. alarmed, at the. situation as now disclosed, by the Treasurer's statement. The Treasurer; whose- words are on record' in "Hansard", said that we need an- export income of £1,000,000,000 a.year: The sum of £1,000,000,000 a year is £227,000,000 more than we were able to obtain from our exports last year. The Treasurer also said that we must achieve our target in respect to imports. And the target is £650,000,000 per year, which is £169,0.00,000 less than we imported last year.

AU; those Australian industries: that are struggling to-day and' are having difficulties because' of a. shortage* of raw. materials and which have been- forced to dismiss hands, should recognize that they have not yet reached the end of the road because, according to the Treasurer, imports again must be cut to the extent of £169,000,000 a year.. The Treasurer also said that after exports- had been increased by £227,000,000 and imports reduced by £169,000,000, it would be necessary to have a steady flow of capital intake in both public and private accounts. Everybody is aware that the Government is- doing its best to secure overseas loans. The Labour party is opposed to that policy. We believe that overseas borrowing should be kept to a minimum and that the Government should only borrow in order to get essentials, for the. development of the country, which cannot be produced inside Australia. But the Government is not doing that. It is raising overseas loans and is using the proceeds of those borrowings, not to bring in essential goods, but to permit the importation of luxuries and newsprint to suit its political friends.

The Treasurer has admitted that there is a very important item in our national balance-sheet which is referred to as- " invisibles ": " Invisibles " include freight, dividends, interest, insurance, and' overseas commitments in respect of travel by Australians abroad. The Treasurer said -

It is hardly likely to be much less in the current year.

He knows that it will almost certainly be more because, already, the. overseas shipping combine, over which this Government- exercises no control whatever, has indicated that it will further increase freights. The Government has said that the only, determining factor as to what freights are. charged our export industries is what the trade will bear, meaning what the shipping combines can extract from the Australian community. Therefore, it is quite evident that this country is in a difficult situation.

It might be. that the Government has a plan which it has not announced to the community for the purpose of overcoming our balance of payments difficulties. But according to the " Review " for the AprilJune quarter, published in Victoria, the Institute of Public Affairs- is fully aware of the Government's plan. Let me tell the House what' the institute suggests is the only way to> overcome our- balance of payments problem. This is the unannounced policy of the Government. The "Review" had this to say -

Australia can no longer look to its traditional exports of primary products to pay for the imports required to support accepted standards of living, employment, rapid and large-scale development . . A reduction in Australian living standards, or in employment would of course lower the demand for imports.

Of course it would, and that is just what the Government proposes, lt is creating unemployment by restricting imports and putting on a bank credit squeeze. It is forcing people out of work so that they will be unable to continue imposing a strain on this country's imports.

Did any one ever hear a more ridiculous argument than was advanced by the Prime Minister (Mr. Menzies) and the Federal Treasurer (Sir Arthur Fadden) on the need to regulate the basic wage? As every one knows, for many years the basic wage has been adjusted quarterly. These adjustments have been calculated on the C series index figures. This index includes potatoes and onions but, according to the Prime Minister and the Treasurer, because the prices of these commodities have now reached " famine " heights, and the workers cannot buy them, they ought to be excluded from the regimen, and so have no effect on the basic wage, lt is indeed peculiar to use the expression " famine " when there has in fact been no famine in the production of these commodities. If one carried this ridiculous argument further one could say that if the prices of other items in the regimen were forced up so that the workers could not buy them, a reduction in the basic wage would be justified. That is the stupid argument that has been advanced by Government supporters.

What other methods has the Government adopted to deal with this important and serious balance of payments situation? According to the Prime Minister he has always hankered to build up an export trade in manufactured goods. He said -

But it is quite clear that we can enter the great markets that are waiting for us only if we can do so at competitive prices. " Competitive prices " means, of course, not lower profits but lower wages for the workers. That is how the Government hopes to build up our export income.

I turn now to the question of overseas borrowing. If the Treasurer cares to look up the statement by Dr. Coombs, the Governor of the Commonwealth Bank, he will agree that that gentleman has directed attention to the seriousness of the present policy of increasing our overseas indebtedness. The Treasurer admits that world trade is becoming more and more competitive and that, therefore, we cannot hope that higher prices for our commodities will get us out of our difficulties. To the contrary, internal inflationary tendencies which this Government, time after time, has undertaken to cure, are making it increasingly difficult for producers to export successfully. We shall not always be blessed with good seasons; we shall have droughts and floods, which will affect our primary production. The Government has been very fortunate. During its term of office Australia has enjoyed bountiful seasons and good markets overseas. That is the only reason why we did not reach this crisis in our economy some years ago.

I should like to make brief reference to immigration, in order to show honorable members what an illogical policy this peculiar Government is following. It tells us that we have to increase our export income either by getting higher prices - which it says are unobtainable - or by increasing production. But, if we increase our population, either by immigration or natural gain, without also expanding our export industries, we shall only accentuate the position. Therefore, immigration does not help us out of our present difficulties. The more immigrants that we have, without a corresponding increase in export production, the less production we shall have available for sale on the world market. In addition, the Government is following a policy of cutting down on Federal and State works. How can we hope for expanded industry, and production, if the Government curtails development?

As a result of this Government's mismanagement and bungling, our economy is crumbling, and falling to pieces. I invite honorable members to consider the state of our roads. Every honorable member knows that half an inch of rain on certain sections of the Hume Highway - the main road between Sydney and Melbourne - makes it impassable. The Government says, "We have not the funds or the resources ''. It proposes to make only £32,500,000 available to deal with a problem which the Minister for Shipping and Transport (Senator Paltridge) has said requires the expenditure of approximately £1,000,000,000. Dr. Coombs used a good argument when he said that £50,000,000 ought to be taken out of the defence vote and allocated to road construction and maintenance. Unless we have m efficient transport system, how can we ever have proper development?

As honorable members know, the Standing Orders preclude me from speaking for more rhan 25 minutes, so 1 shall be able to deal with only one or two more points. Let us examine what is happening to our economy. Public health is a very important matter. Dr. Lilley, the chairman of directors of the Royal Prince Alfred Hospital, declared, quite recently, that £100,000,000 was urgently required to meet the immediate needs of hospitals. He said that there was a big waiting list and that even some urgent cases could not be given a bed. The Commonwealth Minister for Health (Dr. Donald Cameron) appealed to the hospitals to hold tuberculosis patients until their complaint was no longer infectious. But, we find that, of 5,600 cases receiving the Commonwealth tuberculosis allowance, and deemed to bc infectious, 3,000 are not in hospital because there are not enough beds. Yet, we hear all this talk about unparalleled prosperity in the land! The Prime Minister, having spoken about our unparalleled prosperity, admitted that the Australian worker could not afford to buy potatoes and onions.

The Prime Minister promised, in his policy speech of 1955 -

A new housing agreement, with more money for the States at a favourable interest rate . . .

He then brought forward a new agreement which compelled the States to pay 4 per cent., instead of the existing rate of 3 per cent. That, of course, forced up rentals for government homes. Moreover, the Commonwealth has insisted that the States abolish the rental rebate system. This means that even workers on low incomes have to pay the full economic rental. As this is beyond the means of some of them, their single remaining chance to obtain a home has now gone. According to the Commonwealth Statistician, home construction is at the second lowest figure for the past six years. The number of commencements is the lowest for the past seven years. Despite all this, a Government senator said that the end of the housing shortage was in sight in Australia. In his 1955 budget speech, the Treasurer said -

Steadily but surely we are making up the leeway in social requirements, such as hospitals, schools and civic amenities.

In New South Wales alone, 24,800 garages and huts are being used for living purposes. There are 106,000 families sharing accommodation, and the police forces of the various States would advise the Government, if it cared to make the inquiry, that any one who wanted to sleep on a railway station would need to be there early to get a place to put his head. Our railway stations and parks to-day are filled with unfortunate people who have been abandoned by this Government.

Let me deal briefly with war service homes. If ever an obligation rested on any government to care for one section of the community in respect of homes, it is the obligation to ex-servicemen. The Government cannot argue that that responsibility belongs to the States. It is fairly and squarely the obligation of this Government. But it has not increased the allocation for war service homes for a number of years and applicants have to wait two years for finance, even after their applications for loans have been approved. That shows the sorry state of affairs that exists to-day.

This Government promised that it would arrest inflation. But to-day the £1, compared with its pre-war value, is worth only 6s. As the Leader of the Opposition said, one section of the community is hit harder than any other section - and that is the unfortunate pensioners. What does the Government do? When we press for some alleviation of their distress, the honorable member for Indi (Mr. Bostock) says, "We have gone to the end of the road in respect of what we can do financially to help this deserving section of the community ". This party is dissatisfied with the way affairs in this country have been run. We realize that we are poised on the brink of economic disaster and that once again only Labour can save the Australian community.

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