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Tuesday, 2 May 1961

Mr DUTHIE (Wilmot) .- I wish to make a few general remarks on the bill without going into all the minute detail which has been very well covered by speakers on both sides. As we all agree on the bill there is no need to get hot under the collar about it. However, this is a most remarkable measure introduced in a most remarkable situation, because we have the spectacle of a private enterprise government, so-called, introducing a socialist measure. Tt has been remarkable to listen to members on the other side of the House trying to justify the measure within the framework of their political philosophy. Three members of the Government parties could not stomach this bill for the very reason that it is contrary to their political philosophy, lt will be interesting to see how those three members vote if the House divides on the bill later. I am referring to the honorable member for Bradfield (Mr. Turner), who spoke last Thursday, the honorable member for Mitchell (Mr. Wheeler) and the honorable member for Moreton (Mr. Killen). Those three members were quite definite that they would not have a bar of the bill because of its socialist tendencies, but all the other members on the Government side have stood behind the Treasurer (Mr. Harold Holt), patted him on the back and told him that he has done a great job in bringing down the measure.

The honorable member for Higinbotham (Mr. Chipp) chided us for our belief in socialism. Does the honorable member not realize that this bill is a great big chunk of socialism? Yet he is attacking socialism here for all he is worth. If honorable members opposite intend to attack socialism I should like them to be consistent. This Government's policy is riddled with socialism. The Government is responsible for the introduction of many socialistic measures since it has been in office. There is evidence of socialism right throughout the country because, as I have said before, capitalism on its own cannot run any country, and never has been able to do so.

Mr Anderson - Do you not believe in free enterprise?

Mr DUTHIE - Honorable members opposite are always talking about freedom. I call them freedom fighters, but with a small " f ". They get round at election times saying they are against any interference with the rights of the individual. We are sick and tired of hearing this kind of talk over the last twenty years. What are honorable gentlemen opposite like, in practice? They are often better socialists than we are. It is a pity that the people outside do not wake up to honorable gentlemen opposite, who do not act as they talk. This measure is a good example of that.

Among the many examples of socialism which are accepted by honorable gentlemen opposite as normal are egg-marketing boards, wheat boards, barley boards, dried fruits boards, the dairy industry equalization scheme, the move for a reserve floor price for wool within the auction system, the apple and pear marketing boards, publicly owned electricity supplies, road systems, railways and the Postmaster-General's Department, our defence services, social services, health services, public hospitals, marine boards, housing schemes directed by co-operatives, and the war service homes scheme, which is a Commonwealth responsibility.

There is Treasury control of the economy. We have never had more vicious economic control than we now have under this socalled free enterprise government. The Government's credit squeeze is as vicious as anything, that has obtained since the great economic depression, and it is producing results just as bad as the depression produced.

The Government prates about being a free enterprise government that believes in individual freedom. What sort of freedom is the Government giving to people? There are 100,000 men and women out of work. That is the kind of freedom that the Government believes in. That policy is a vicious interference with the freedom of the individual. It believes in freedom to collect the dole of £6 2s. 6d. a week. Honorable members opposite are interjecting now. They do not like to hear the truth. You gentlemen on the Government side are complete hypocrites when you talk about freedom. You want the freedom of dole queues. You prate about the evils of socialism, although you are the best socialists this country has seen for years, and you are doing it all under the guise of free enterprise. You are freedom fighters, all right - freedom fighters of clay. You are limiting freedom all round Australia, and you have the nerve to criticize us for our belief in socialism.

Mr J R Fraser - They are just undercover socialists, that is all they are.

Mr DUTHIE - Yes, and well down, too. The Reserve Bank is a completely socialist institution, and the Government has strengthened it since it came into office. The honorable member for Higinbotham got all worked up during the debate, and his words have led me to deal with nationalization and socialization. The Government proposes to socialize assurance companies and superannuation schemes, in effect, by forcing them, by a very clever trick, in the form of tax concessions, to invest 30 per cent, of their funds in government securities.

Mr Cleaver - But you are supporting the legislation.

Mr DUTHIE - I know, but we believe in handling the matter another way. We believe in going further than this. But you are the people who talk about governments keeping their hands off the rights of the individual, and of letting people have complete freedom, yet you are bringing in a bill like this to restrict freedom. You are actually trying to bribe insurance companies into lending money to the Government, because that is all this proposed tax concession really is. The honorable member for Moreton was right in what he said about it to-day.

There are pages and pages of this bill. The number of words in the bill is staggering. There is also a 34 page document which the Treasurer had to issue to explain the bill to us, so involved and complex is it. After the draftsmen have burned the midnight oil to prepare this bill, after all the speeches have ended in this place and another place, and after the bill becomes law, what then? In spite of the fanfare of trumpets, the life assurance companies and the superannuation funds may still refuse to invest one extra penny in government securities. I wonder what the results of the bill will be in actual investments, because these organizations can still refuse, and in their present mood I think many of them will refuse, to invest in government securities. It seems to me that this bill and all it involves - all these words and the long explanation, are like using a bull-dozer to move a matchbox or, to employ another analogy, let me say that the birth pangs of the bill may be long and painful, yet the child may be stunted, weak and anaemic.

The Government backed down on this legislation. Originally it was to be a coldblooded provision for a 30 per cent, forced loan from insurance companies and superannuation funds. But there was so much criticism of the Government by life assurance companies that the Government backed down and produced instead this measure with its conciliatory provision of a tax concession for assurance companies and superannuation funds which invest 30 per cent, of their funds in Commonwealth securities. In other words, those big firms and superannuation funds are offered a bunch of carrots on the end of a stick, as it were, to persuade them to invest in government securities. There are to be tax rebates in respect of investments in government securities. The Government has watered down the bill, which is no longer in the form in which it was first proposed.

We on this side of the House agree that the insurance companies and the superannuation funds in Australia have become great vested interests. They have been very backward in helping the wider activities of the national government, and have come to regard the national interest almost as being something in another world. Indeed, investment has got right out of balance in this country. Australia's national needs have often been by-passed by investment made purely in order to get higher and ever higher rates of interest. These investments have not taken account of the national interest. We believe that, in that respect, this bill is a move in the right direction. We believe that a re-direction of investment is urgently necessary in Australia, and in that respect, this bill has brought the whole matter to a head.

There has been much talk about fringe banking institutions. These were hardly heard of a few years ago. Fringe banking is actually by-passing Treasury direction. Here again, we have a big slab of socialism. The Treasurer says, " We have stated a financial and economic policy for Australia ". But we have this fringe banking by-passing the Treasurer's direction and the control of the Reserve Bank of Australia and actually forcing the Government into measures of this kind in order to get control of the country's finances again. Yet we are told that private enterprise must be left alone. On this point, the Government and its supporters have shown themselves to be hypocrites.

The private banks have established hirepurchase branches and thereby encouraged the development of a huge secondary banking system in this country - a development which has reached serious proportions. The banks have their representatives in hirepurchase companies, land-trust companies and insurance companies, and this great subsidiary banking system is almost completely beyond the control of governments, either State or Federal. We on this side of the House believe that this Government has handled the problem with kid gloves over the last few years and is not prepared to grapple with this secondary banking system that is by-passing the direction of the Reserve Bank and the Treasury.

This measure is a sort of belated effort by the Government to tackle inflation, which is the Achilles heel of this coalition Administration. It has allowed the fringe banking empire to grow unchecked until it has become a threat to the Commonwealth's whole financial structure. Even in this measure, the Government is handling the problem with kid gloves, because, as I said before, Mr. Speaker, the insurance companies and the superannuation funds need not invest Id. in Commonwealth securities even when this bill becomes law. If they say that they do not want to make such investments, the Government cannot force them. It has offered additional tax rebates in respect of investments in government securities, but this bill will not require such investments to be made. As a result, the passage of this measure could be a waste of time and could bring back only a very small trickle of investment in government securities, although we need so much investment in these securities in order to undertake housing and national development programmes.

For these reasons, I consider that this bill does not measure up to what is required. It represents only a flash in the pan and, as I have said, amounts to handling inflation with kid gloves. In every respect, this Administration is a government of fits and starts and half measures. It never takes hold of a problem with both hands and fights it to a finish. That is one of our criticisms of the Government's economic measures, of which this bill represents a part. So we support the bill, but only because it is a step in the right direction, for it represents a move to get these big financial empires to invest some of their money in Commonwealth securities and in the national interest.

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