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Tuesday, 29 November 1960

Mr HALBERT (Moore) .- As I knew I was to speak to-night, I listened to every word spoken in this debate by Opposition members, hoping to hear some constructive criticism and to learn the reasons that made them oppose the measures against inflation now adopted by the Government. For the sake of the record, I mention that I listened to the honorable members for Melbourne Ports (Mr. Crean), Macquarie (Mr. Luchetti), Barton (Mr. Reynolds) and Fremantle (Mr. Beazley). I am amazed at the complete lack of constructive thought by Opposition members. The importance of these measures cannot be over-emphasized when one studies the facts and figures given by the Treasurer (Mr. Harold Holt) and other Government supporters. These show the enormous impact of the motor vehicle industry on the Australian economy.

Members of the public hearing the rather empty and meaningless tirades of Opposition members must be completely confused, but their state of confusion is no less than the state of confusion of Opposition members. For the sake of useful exercise, I would like to give some of the complete contradictions in the speeches of Opposition members. Throughout this session, honorable members opposite have condemned the high profits of the manufacturing industries; yet at the same time they condemned the lifting of import restrictions, though this action provided real competition for those who allegedly made high profits. Opposition members have particularly condemned the motor vehicle industry for making high profits; yet now they maintain that this industry will be more or less ruined as a result of this additional tax. Whilst condemning the high profits, they have praised the ability of the industry to maintain low-cost production. These are continual contradictions. They have suggested that motor car sales will be materially affected; yet they ask what the Government will do with the extra revenue obtained from the sales tax. They demand that the Government maintain economic stability; yet they condemn every action taken by the Government to achieve this purpose. They have continually condemned the Government for not controlling inflation; yet they advocate every action that is likely to increase inflation.

To-day, we have been told by Opposition members that these measures will create lack of confidence which will affect overseas investments; yet during the short period that I have been a member of the Parliament I have heard Opposition members bitterly oppose the investment in Australia of overseas capital. Opposition members refer to the tragic effect that increased sales tax will have on the motor vehicle industry, but at the same time say that action on these lines should have been taken eight or nine months ago. They make the charge that the Government is discriminating against this huge industry and then suggest that the economy can be dampened down by controlling the import of a few pounds worth of honey or tinned chicken. I think it was the honorable member for Melbourne Ports who gave the figures and said that imports amounted to something like £212,000,000. Then he suggested that the Government, instead of trying to dampen down the inflationary effect of this enormous expenditure, should control the import of honey and tinned chicken. I think that can be described, in our Australian vernacular, as a honey of a remark.

The honorable member for Macquarie made a feature of the fact that this action has been taken three months after the introduction of the Budget. He said that this made the Budget a meaningless document. I am sure that any one stopping to consider the position for a moment would realize the enormous ramifications of the Budget and would know that months of work go into its preparation. Compared to the Budget, these adjustments in the economy are modest. His was a stupid statement to make, and it is difficult to understand his assertion that these adjustments mean that the Budget has been a waste of time. The honorable member for Barton said that a car purchased for £1,000 would include in the price sales tax of £400. I am sure that he would not mean to exaggerate deliberately.

Mr Forbes - He told a lie.

Mr HALBERT - Well, it was a mistake, I am sure. The additional tax on a motor car selling for £997, including sales tax, would be £64 and the total sales tax would be £254, not £400. This is quite a lot to pay, of course, but we must keep to the facts. In a fairly long tirade, he suggested that many people selling motor vehicles would go out of business. He described very graphically all the money that had been spent on displays and sales efforts and said all that would be wasted. The fact is that the additional sales tax will mean an overall increase of only about 6i per cent, in the price of a motor car. On making a check in connexion with one imported motor car, I discovered that this measure will mean an overall increase of only 3 per cent, in price. I am certain that if competition becomes keener and if, as members of the Labour Party would have us believe, the manufacturers of motor vehicles are making huge profits, the overall price increase will be kept at only 6i per cent, and this measure will not have the tragic results which honorable members opposite prophesy. It is only natural that sales will be dampened, and we of the Government parties certainly hope that this measure will have that effect.

When replying to the claim by the honorable member for Moreton (Mr. Killen) that this measure would not result in unemployment in the industry, the honorable member for Fremantle overlooked a number of pertinent facts. For instance, he did not seem to appreciate that a decline in the sales of imported vehicles would not affect the Australian manufacturers. It is well known that some motor car manufacturers in Australia have not been able to keep up with the orders placed with them. It was reported recently that they needed 5,000 more employees. If they are short of employees now, it is reasonable to argue that a drop in the number of orders will not lead to any great unemployment.

The important point to me as a representative of a rural area is the tremendous adverse impact of inflation upon our primary industries. It is essential that serious measures be adopted to curb the menace. If the attitude of the Labour Party were genuine, honorable members opposite would be arguing that the steps the Government proposes taking are not strong enough. They would not be decrying this proposal. I submit that, despite the slight cost involved to the individual, whatever temporary inconvenience may be felt, and whatever temporary drop there may be in the profits of the manufacturers, the result will be worth while. After all, I think it is generally agreed that no government measures such as this can be invoked without some slight adverse effect upon somebody.

Members of the Labour Party have shed crocodile tears about the plight of primary producers on many occasions, but I am confident that the primary producers will be only too happy to submit to slightly higher charges for the few motor vehicles they require if that will mean some diminution of the tremendous impact inflation is having upon their livelihood. I am certain that they would much prefer to have available ready supplies of steel, wire, machinery and all those things which are of far more importance to their industry than an increase of a mere 6i per cent, in the overall price of a motor car.

I was almost amused to-day when one speaker opposite spent some time explaining how essential motor cars are to the Australian people.

Mr Curtin - What do you mean by " almost amused "? Were you fully amused, or were you amused at all?

Mr HALBERT - Just partially amused.

Mr Curtin - How do you get partially amused?

Mr HALBERT - The honorable member always amuses me. The amusement I experienced this afternoon was prompted by one honorable member's obvious ignorance of the fact that this Liberal-Country Party Government realizes that in an agricultural country such as this a motor vehicle is of great importance. T could have been no more amused if the honorable member had said that bread arid butter are essential on the family table. When it is realized that the average number of motor vehicles in Australia is one to every four people, I do not think there can be any complaint at the Government's adopting measures calculated to steady the purchase of private motor vehicles with a view to bringing some balance to the economy. With our increasing population, this country is crying out for development. Continually we read in the press and hear from speakers - many of them on the Opposition side- of the need for developing and populating the great open spaces of the north. The honorable member for Fremantle knows how important it is that water be provided for the development of large areas of Western Australia. One does not need to be an economist to realize that we cannot have this essential development while enormous sums are being spent on such consumer goods as motor cars. This Government has a responsibility to dampen down expenditure on non-essentials, or on those essentials of which we now have ample for the time being* and to encourage expenditure on the erection of schools, hospitals and universities, and the establishment of such agricultural industries as will lead to an increase in our export income. After all, the finance for all necessary capital development can come only from the savings of the people and at least portion of their incomes should be expended in this way. We must all appreciate that we cannot have our cake and eat it too, but it would seem that with the boom conditions we are experiencing to-day a large number of Australians really believe that we can.

The Minister for Trade (Mr. McEwen) said that our economy is balancing on a razor's edge. That statement has been ridiculed by members of the Opposition whose understanding of economics is so slight that they cannot appreciate the subtlety of the Minister's metaphor. Let me give a simpler example in the hope that- honorable members opposite will appreciate the position. Australia's economy can b~& likened to a person balancing tin a tightrope. I suppose most honorable" members have been to a circus at some time iri- their" live* arid have come to appreciate that' it requires great" skill to' Keep one's balance on" a tightrope. Just as skill is required to keep balance tin a tightrope, so is it required to kee"p balance in our economy: Perhaps I earl give an illustratien of what balance means In trie matter of economic thinking the Labour Party would not be able to balance on a 2-ft. scaffolding board, which is the type of platform it has been falling off. The Opposition has made repeated jibes about "put and take " which illustrate its complete misunderstanding of the situation. I borrow from the Treasurer (Mr. Harold Holt) an example which he gave about steering a ship. Most honorable members have been on the bridge of a ship and watched the captain set a course. It has been suggested that the captain could steer the ship by tying the steering wheel in one position and need not worry further; but anybody who has watched a steersman handling a ship will admit that he must continually turn the wheel one way or the other although, at the same time, he maintains a true course. We, as a Government, are still maintaining a true course although steering adjustments have to be made from time to time. That is the action of statesmanship.

Mr Reynolds - Mr. Deputy Speaker, I wish to make a personal explanation. The honorable member for Moore (Mr. Halbert) misunderstood, I believe honestly, what I said about a car costing £1,000. He apparently interpreted that figure as being the total price of the car, including sales tax; and I think he said that on that price the sales tax would be substantially less than £400. Obviously it would be less, if the total price of the car was £1,000; but I referred to a car priced at £1,000, with sales tax to be added, and I said that the tax added £400 to the price.

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