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Tuesday, 14 March 1961


Mr DEPUTY SPEAKER - Order! The honorable member for Parkes will withdraw that remark.


Mr Haylen - Yes, Sir, I withdraw it.


Mr REYNOLDS - I do not want to traverse the whole of the speech made by the honorable member for McPherson, but I must refer to one other thin» that he said. He referred to Queensland and its long-term Labour rule, and blamed the present difficulties of Queensland on past Labour governments, despite the fact that fifteen out of eighteen federal members from Queensland are on the Government side in this chamber. The honorable member for Macarthur (Mr. Jeff Bate) is trying to bait the people by taking 22 back-benchers to Queensland and the north of Australia to show them the prospects and potentialities there. So I suppose that after twelve years of mis-government by this Liberal-Country Party group honorable, gentlemen opposite will come up with propositions about the development of the north next year. That is typical of their lack of realism, because they probably will not be in office to implement any kind of proposal.

The honorable member for Henty (Mr. Fox) said that Australia's prosperity was unsurpassed by that of any other country. If he looks up some of the figures about productivity he will find that, compared to some other up-and-coming countries, Australia is not doing so well. I refer to the percentage increase in industrial production which is a pretty good indicator of the country's progress. From 1953 to 1958 the industrial production of Australia increased by 33 per cent. That is not too bad, but it is not as good as Government members would have us believe. The corresponding increase in West Germany was 52 per cent., in France 53 per cent., in Italy 43 per cent., in Japan 69 per cent., and in Russia 70 per cent. Those figures are some indication of the improvement made by other countries which are in competition with Australia. Except in respect of Australia, my figures are from the National Institute of Economics and Social Research, London. The figures for Australia are from the Australian and New Zealand Bank Index of Factory Production.

I shall cite only a few indicators of our so-called unsurpassed prosperity before I dip into the present situation regarding employment, housing and public utilities. The January bulletin published by the Treasury puts loan raisings by this Government in the first half of 1960-61 at £57,800,000. That indicates the amount of confidence that the Government has engendered in the Australian lending public! It was able to raise only £57,800,000 compared with £94,600,000 for the corresponding six months of the previous year. In its moments of calamity, this Government is frequently asking what the Australian Labour Party would do if it were in office. In the first place, the Labour Party would never have put itself in the position in which the Government now finds itself. That is clear from what Labour spokesmen said at the time import restrictions were removed and other parts of the Government's economic policy were initiated. In any case, the advice given to this Government over recent years has not been accepted or has been accepted too late to be of value in remedying the situation.

For a number of years, not only the members of this party but other responsible people in the community, including economists, have been pleading that the Government should establish some plan of national development - that there should be a co-ordinated, integrated plan of development. In 1954, and probably even before that, there was reference to the dangerous effects on the financial set-up of the advantageous position of notes and debentures as against shares. The Government was warned that the growth of hire-purchase companies and other financial institutions outside the banking system was in a large measure attributable to the fact that interest payments on loan raisings by way of debentures and notes were taxable deductions for the companies concerned whereas investments in shares were not. Now, seven years later, after typical procrastination the Government has been brought to its knees and forced to try to do something about it. Even now, it is backing and shifting on what it should do about the deductibility of interest paid on notes and debentures.

Time after time, the Labour Party has referred to the dangerous growth of monopolies and restrictive trade practices but still there is no legislation before the House on this subject. The Attorney-General has had to canvass the opinions of various State governments in order to get some kind of protection for the people against this parasitic growth that has contributed to the inflationary spiral over recent years. Government supporters have decried our plea for closer relations with our Asian neighbours. Even at question time to-day, the Government, by implication, decried our suggestion that we should recognize the most powerful Asian country of all - China. The Government is sending trade commissioners to al! parts of the world except to the most powerful nation in the whole of our Pacific area. Trade representation there is precluded by the fact that we do not even officially recognize China.

On this side of the House we do not necessarily support China's kind of government any more than we support the kind that Russia has or the kind that Chiang Kaishek provided for his people. Bui we accept the governments of those countries because they are the effective instruments of government. This Government, in its petty political way, denies our people the opportunity to trade with China except by sneaking to the back door when nobody is watching and shovelling in a million bushels of our surplus wheat or some wool. It will continue to play its little political game until it is given different orders from Washington.

The Government has resisted pleas from every section of the Australian community that it should regard education, particularly technical education, as a matter of national importance which is tied to the economy and to the welfare of the Australian people. The Government has resisted those pleas year in and year out, but I do not know whether the Australian people will give it many more months in which to resist them.

I was at a conference in Sydney last yea at which primary producers, industrialists, professional people, commercial people and every other section of the Australian economy was represented and that conference unanimously called upon the Federal Government to provide emergency aid for Australian education. The way has been shown by the United Kingdom and by Russia which recognize that their educational system is intimately connected with their economy. Now, President Kennedy has recognized the needs of education by providing, for the next three years, 2,200,000,000 dollars for education to supplement earlier allocations amounting to the equivalent of £A.450,000,000. He has done this in order to provide more qualified teachers and better school facilities to help America to compete in the world economic struggle as well as in the world social and philosophical struggle. There is a federal government that recognizes its responsibility and is doing something about it!

Government supporters applaud what West Germany has done. I have not been there, but I have talked to educators who have been there and who have had intimate contact with the education system. They all speak of the tremendous importance that West Germany places on technical education. It is pre-eminent in Germany. Scientific research and educational programmes are tied up with the stupendous development of West Germany since its defeat in World War II.

Government supporters ask what Labour would do if it were in office. Surely it is clear that a Labour government would take positive action. The things that the present Government has done belatedly should have been done long ago. The granting of tax concessions to exporters, now a Government proposal, was suggested at least two years ago by the Government's export promotion people. It has taken the Government all this time to consider the matter. To act belatedly is almost as bad as not acting at all. There is no co-ordinated plan for development. The Government paid no attention to our warnings about the kind of investment that was coming in from overseas. It now recognizes that a lot of this investment was inflationary, that it was not productive, and that it helped the land boom and saddled unfortunate people in municipal government with all sorts of burdens, and so saddled the taxpayers with tremendous rates.

The Government uncritically and unquestioningly accepts everything that comes its way, whether it is a dollar or any other kind of money. The purpose to which the money is directed does not seem to concern the Government, lt all seems like going the wrong way about trying to teach a young fellow to swim. You can go about the task methodically and follow a scientific routine, or you can push the young fellow into the middle of the pool and say, " Get out. If you do not you will drown." Then when he does not look like getting to shore you bring in some pumps and take away the excess liquidity. You suck the whole pool dry. It seems to me that that is the sort of thing the Government is doing with the Australian economy. You have thrown the Australian people, the manufacturers and employers into the middle of the pool and sard, "We have abolished all restrictions on imports. We have done away with all that sort of protection. Get yourselves out of your difficulties." When these people were trying desperately to get on to firm ground, the Government has clamped restrictions on them and has hit everybody. Talk about a free enterprise economy! Yet the honorable member for Mcpherson has told us that anybody who is deserving of bank credit can get it.

I know personally of young persons who have won ballots for land in Queensland to enable them to start beef production, but who could not get one penny from the Commonwealth Development Bank or from any government instrumentality. They were passed on to the pastoral companies which, to their credit, have helped as best they could. I know one young fellow, a close relation, in Queensland who rs trying his best to make use of land that he won in a ballot. He has been unable to get assistance, and his is a typical case. The periodical " Muster ", which deals with rural matters, has reported that because of the credit restrictions, farmers are unable to buy store cattle to replace fat cattle that they have sold. I know of many farmers who want to improve their pastures and they have been denied finance by the Commonwealth Development Bank and other instrumentalities, just as various timber interests and others have been denied bank advances. Yet this Government tries to convince the people that it has not done anything to the Australian economy, and that there is nothing wrong at all. The fact is that we have had a catastrophic fall in overseas balances to £299,000,000. We remember that only three or four years ago - in 1956-57 - our balances were as high as £567,000,000. If we go a comparatively few years further back we recall when our balances totalled over £800,000,000 but they have been dissipated. Soon we will have import controls again. Everybody is buying all sorts of things, essential and nonessential, just as they did in 1951-52. We squandered our reserves and then when we wanted essential goods to help in the development of Australia, they were not available to us.

Like the honorable member for St. George (Mr. Clay), I challenge the figures relating to unemployment that have been issued. I say quite seriously that I do not think they show the true position. My office is in the same building as a Commonwealth employment office. 1 see people sit there for hours. They do not get a chance to see the officer and they go away. 1 would say that on a conservative estimate one-third of those who call at the Kogarah employment office walk away without registering. They are not prepared to wait just to get the unemployment benefit. A single adult male is allowed £3 5s. a week and a female £2 12s. 6d. with an additional 12s. 6d. for a child. God help the big families. They do not get anything for tV second, third, fourth or subsequent children. The allowance has stayed at those levels for years. The employment officers are snowed under. From my observations, I would say they are all decent, capable people but with the best will in the world, they cannot help everybody. They cannot interview unemployed persons for longer than five minutes. Instead of getting out among industries to observe production and ascertain where workers are likely to be required, they can only register people as best they can. All other activities have gone by the board so far as I can see. It is typical of the Government that there has been no recruitment of employment officers to reinforce the staff of the Commonwealth Employment Service to meet the current situation. The same few people are trying desperately to cater for the growing numbers of unemployed.

Housing has been struck a sorry blow. Just when we seemed to be coping with the problem, the value of new buildings approved fell in December last by 28 per cent, compared with the figures for November. The value of new houses and flats, apart from other buildings, fell by 20 per cent. The value of all other new buildings approved for construction fell by 38 per cent. That decline must leave its mark on the community. Possibly there is no gross unemployment at present, but all the seeds have been sown and they will germinate in the next few months. Unhappily, there will be a substantial increase in unemployment. Last December, the number of houses under construction was the lowest in seven years. At the same time, those who attended the Citizenship Convention in Canberra were confronted with a plan to increase our quota of immigrants over the next five years. We had a fiveyear plan for immigration but no integrated plan to provide housing, education facilities or other amenities.

Under the credit squeeze, not only the persons who import non-essential goods are affected. Even the Acting Prime Minister (Mr. McEwen) has acknowledged this fact. The people who have to pay are the masses of the community. People whose jobs are hanging by a thread are dependent on the Government's economic measures to stop imports entering the country so that their jobs c°an be preserved. What a dilemma the Government is in. If it relaxes credit restrictions, imports will rise and it will be faced with the same old problem. If the Government retains the present credit restrictions, it stands a good chance of creating the unemployment about which Sir Douglas Copland and others have warned us. Unfortunately, all these things could very well happen.

I cannot speak about all the matters 1 wish to discuss, but I shall offer some positive suggestions. First, it is absolutely essential that selective import controls should be re-introduced. Secondly, we should step up our trade promotion programme. Appropriate measures would include taxation concessions to exporters. In that respect, the Government has done the right thing so far as it goes, but this is a long-term plan. The immediate objective is to stop the rot. We should help trade promotion by an extension of trade commissioner services particularly in Asia. We must also solve the political problem of what to do about recognition of China. We should go beyond the establishment of insurance facilities for our exporters. Like other countries, we should provide credit facilities in Asian countries which want to buy our goods. I have had representations made to me personally by a firm which makes high-class optical equipment. It can out-bid Germany, Japan and the United States of America in price and surpass the quality of goods from those countries. Some people from Pakistan have examined this industry and have been trained in it. Their only worry is that they might have trouble in raising sufficient credit to establish the business in their own country. In the first six months of this financial year, we are raking in £56,500,000 in customs duties. It would not be a bad idea to devote that revenue to a fund to help provide shortterm credit at reasonable interest rates to purchasers of our goods in Asian, countries. Once we get a foothold, our trade will grow.

I suggest also a full-blooded drive to encourage tourism. We should not humbug around with a vote of £200,000. If we are fair dinkum, let us get right into this field and try to help those people in our own country who are catering for potential tourists. Credit must be made available for those who produce in Australia goods that we are importing from overseas.







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