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Tuesday, 14 May 1957

Mr CLAREY (Bendigo) .- The Opposition feels that the attitude of the Government in consistently opposing the reintroduction of automatic adjustment of wages might well be considered by this House in view of the serious effect that it is having upon the workers in the community. The Government has expressed this attitude on three occasions during the last few years. It did so, first, in the Commonwealth Court of Conciliation and Arbitration in 1953; it next did so in 1956; and it again did so during the recent proceedings before the Commonwealth Arbitration Commission. On that occasion the Government expressed not only its opposition to the re-insertion in federal awards of clauses providing for adjustment, but also its opposition to any form of wage adjustment. I desire to place before the House some reasons to support my contention that this attitude of the Government should be abandoned and that a different policy should be adopted.

I point out to honorable members that automatic adjustment of wages first began to operate under federal awards granted by the late Mr. Justice Powers in 1922, for certain specific reasons. There had been a period of inflation from 1917 to 1921, which had forced prices very high. Wages had not kept pace with prices, with the result that the standard of living of the workers had declined seriously. In 1922, the principle of automatic adjustment of wages by means of quarterly variations of awards, in accordance with the rise or fall of prices during the preceding quarter, was adopted. The court considered that it was desirable, in the interests of industrial peace, that the wage fixed by it should, as nearly as possible, be a static wage and have an unvarying purchasing power. The adoption of this system came about very largely as the result of a wave of industrial unrest which had seriously shaken the Australian economy between 1918 and 1921. Almost every industry in the Commonwealth had been the subject of such unrest because of the falling value of wages. An earnest attempt, therefore, was made by the Commonwealth Court of Conciliation and Arbitration to prevent such unrest, by the adoption of a system of automatic adjustments. That system operated from 1922 to 1953, a period of 31 years which included good years, bad years, war years, years of depression and years of expansion, so that one could say that, in those 31 years, the whole system of wage adjustment had had a trial under varying circumstances, all of which had had some effect upon the economic life of Australia.

So far, the only reason given by the Minister for Labour and National Service (Mr. Harold Holt), who speaks for the Government in this matter, for the abandonment of quarterly adjustments, has been that wage adjustment is not a satisfactory way of dealing with wages. To use his expression, as far as I can remember it, he said that when the court fixes an economic wage there is no guarantee that the wage so fixed can be adjusted, with safety to the economy, as prices rise.

Mr HAROLD HOLT (HIGGINS, VICTORIA) - The honorable gentleman is not purporting to quote me. is he?

Mr CLAREY - Apparently, it could be adjusted if prices fell, because wages would then come down.

Mr McMahon - I rise to order. The honorable member for Bendigo is purporting to quote the Minister for Labour and National Service. I should like to make it quite clear, Mr. Speaker, that it is improper, under the Standing Orders, to quote a person incorrectly, or to purport to do so.

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