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Tuesday, 18 September 1973
Page: 1171


Mr RIORDAN (Phillip) - The Opposition this afternoon has made it clear beyond any doubt that it is truly here as the captive and the puppet of big business. The voice of its members is not a voice which has expressed a concern for the Australian people. They have not been concerned about the price exploitation which is occurring. Rather have they been concerned to protect profit maximisation. Country Party members in this Parliament speak against any form of price control as being iniquitous. Yet we know that for years Country Party members have supported and acknowledged that prices on a wide range of primary products have been fixed. For example, the prices for sugar, milk, butter, cheese, flour, bread and eggs have all been fixed, and controlled prices still apply. Country Party members say that to fix prices is wrong and that such action will result in all sorts of economic difficulties.

The Leader of the Opposition (Mr Snedden) has based a great deal of his opposition on the fact, as he has alleged, that the Prime Minister (Mr Whitlam) was rolled by Caucus, to use his unique phrase. That statement is just incorrect. The Leader of the Opposition has been misinformed. He has a most unreliable informant. He should check his facts more carefully. The Prime Minister did not argue against a prices referendum. The basic fact stated by the Leader of the Opposition is not correct. The Prime Minister made it clear in his second reading speech that, if the Australian Parliament, is given the power and authority to regulate and to control prices, his Government will use such powers responsibly and selectively as one of the elements in an anti-inflationary strategy. The strategy proposed by the Opposition it not easy to understand and to comprehend. It certainly is easier to understand than is the same policy that we have heard for 20 years proclaimed by big business interests in this country and elsewhere. They propose an incomes-prices freeze. It is not clear how such a freeze would be enforced, particularly as this Parliament has no power to adopt such a course and the Opposition opposes the Parliament acquiring such power.

The Government is committed to the maximum utilisation of the nation's resources so that all of its people can enjoy a higher standard of living and a better life style. The Australian Labor Party has constantly rejected the mechanism of creating a pool of unemployed as a means of achieving stabilised prices. Such an approach in our view is socially unacceptable. The concept that certain groups can be called upon to be the sacrificial lambs in the name of economic stability is repugnant to decent social ethics. Those who suffer under the unemployment pool concept are the migrants and the low income earners. The concept of deliberately creating unemployment as an economic weapon is as callous and as cynical as one can imagine. It ignores basic human values. An unemployment pool may not be a freeze but it is certainly pretty cool for those who find themselves in it.

The Liberals have shown in the past that their basic weapon against inflation is to create these pools of unemployment. By a series of actions, they managed to achieve an economic recession and galloping price inflation at the same time - a rare economic achievement. Their prices-incomes policy which they practised regularly in non-election years was to eliminate the income of some and to allow prices to find their own level. If they get their way again, they will do exactly the same thing. With added power, they may make it worse.

What this Government seeks to do is to acquire the capacity to regulate prices. The Opposition adopts the false premise that wages and salaries are the prime cause of price increases. This is ludicrous and quite incorrect. This premise has been rejected by the Commonwealth Conciliation and Arbitration Commission on several occasions. The prices which are currently affecting the consumer price index and which reflect the level of price increases are overwhelmingly related to commodities which are not significantly affected by wage and salary increases. The prices of meat and potatoes have been determined almost exclusively by supply-demand considerations and not by wages. The price of land in our capital cities has spiralled without justification. The Australian Parliament is the only democratic body in the industrially developed world which does not have power to regulate prices. This is a situation which is inconsistent with the will of the Australian people. The Australian people wish this Parliament to have this power. This Bill is designed to allow them to express their view and to make the decision. The Opposition seeks to prevent the people from having a say on this matter.

Of course, it is significant that the Opposition is opposed not only to the referendum seeking to grant that power but also to the measure which will allow the Australian people to vote on this important question. The interests of consumers are not being protected in the current economy. The Australian people are clearly being exploited. Basic foods are rapidly becoming a luxury for many low income families. The aged, sick and infirm who rely on social welfare payments are being denied the right to eat the food of their choice. They are being forced to change their diet habits in order that a few may grow rich. Young married couples are being forced to wait longer for a home because of the land price spiral. Some may well never get a home. Land prices in Sydney have reached a scandalous stage. Those who have locked up large areas of land for speculative purposes are sucking the economic lifeblood out of many young Australians. Nobody can claim that housing is a luxury. It is a basic necessity of life.

Those who see the cure for all of our economic ills in an incomes-prices freeze are badly informed. Those who believe that there is a special magic in a policy of incomesprices policy should make a definitive statement about what they mean, and how they propose to introduce such a freeze. The socalled freeze argument assumes that all wages and prices are currently in their correct juxtaposition within the total economic structure. This assertion is simply untrue. The prices of land and many food items are artificially high. Wages have been adjusted regularly by the Conciliation and Arbitration Commission after prices have risen. Action has been taken by the unions to restore the purchasing power of wages and salaries. There has not been a case in which it can be shown legitimately that wages have been fixed in anticipation of a price rise. At the present time, wages and salaries together with social service payments are being squeezed by increased living costs. Whilst wages are controlled through the arbitration tribunals in all of the States, a fact conveniently overlooked by the Opposition, there is-


Mr Graham - Minimum wages.


Mr RIORDAN - Oh! My friend from North Sydney wants to talk about minimum wages. In very many cases, as I will show him in a moment, the minimum wage is in fact the maximum wage even though the law provides that it is the minimum wage. I can come to that and show the honourable member that in just a minute. Whilst these wages are clearly controlled in all the Australian States by arbitration tribunals and whilst they are controlled here by the Australian Arbitration Commission, there is no regulation of essential goods and services and their prices. The so-called freeze also ignores the fact that wages for particular industries are fixed at different times. A freeze imposed tonight would mean that those who received increases today would have an artificial advantage over those who are due to receive an increase tomorrow. This is what occurred in the United States of America.

Let me take the honourable member for North Sydney to the point that he made concerning the question of a minimum wage and a maximum wage. The arbitration tribunals of this country recognise that the minimum rates set in some industries are the maximum rates. That is why the arbitration tribunals in fixing wage rates, having regard to comparative wage rates, differentiate between what they call minimum rates awards and actual rates awards. The differentiation is clear. In fact, in my view the great majority of incomes are controlled now. Those who receive wages and salaries are controlled in some form or another. A most significant section of our work force is currently receiving a minimum or basic award wage only. Let me tell honourable members who they are. Twenty per cent of all wage and salary earners are to be found in public employment of one form or another. Those employed by the Australian Government, the State governments, the statutory authorities, and the local government bodies represent 20 per cent of all those employed in this country. Those employed outside the huge metropolitan areas of Sydney and Melbourne have either significantly lower over award payments or no over award payments at all. They represent 56 per cent of the Australian work force.

So we can see clearly that more than half of those in the Australian work force in fact have their wages controlled by awards of the Commonwealth Conciliation and Arbitration Commission. Let us consider those who receive over award payments. How do they get them? Do they simply say. 'We are going to take same more money; we have put up the price of our labour'? Of course they do not. They have to bargain with an employer who has to agree, otherwise they do not receive such a payment Once prices are subject to regulation, there obviously will be a reluctance by employers to agree to over award payments because they will realise that they cannot simply pass on the increased cost to the consumer. So honourable members can see that by the mere introduction of prices regulation machinery there will be an immediate effect on wages. Obviously, there will be a return to the Conciliation and Arbitration Commission for the fixation of the total wages paid. The Commission will be better equipped in the light of the experience of the last decade to fix wages and salaries on a fair and equitable basis.

The so-called freeze ignores what is to happen to benefits of increased productivity. Presumably, during the period of the freeze, all of this would go into the pockets of the investor and none into the pockets of the employees. Once prices are subject to regulation there will at least be a chance of controlling the price-wage increase cycle. The average worker derives nothing from the exercise of gaining a wage increase which is followed immediately by a price increase, followed by a further wage increase, another price increase and so on. In fact, many workers finish up worse off as a result of this circular exercise. The exercise has gained little or nothing for the average Australian worker. The fact that prices have been allowed to set the pace has created great hardship for those who rely on welfare payments and fixed incomes.

There is another area of financial reward which has been ignored by the Opposition, and quite predictably so. Many of the senior executives of our industries have enormous fringe benefits which have a very significant monetary value. These usually are not subject to taxation. They are available only to the privileged few who earn high salaries. I refer to the charging of rents below par for company owned houses in which they live; generous expense accounts which are made available; extravagant superannuation schemes which are for the privileged few; the business trips to Honolulu and elsewhere on which the family is taken along and which consists of one 10-minute interview - the total cost is on the house; the payment of school fees for children under company executive scholarship schemes; and the provision of motor cars and the payment of running costs. All of these benefits are taken out of the profit of the companies and are not taxable.

Do those benefits come under the Opposition's freeze? Will they be allowed to breeze along on these extravagant benefits while the low wage worker finds it hard to buy a pound of sausages? That is the sort of thing we meant when we said that meat is getting too dear for the average worker. What do members of the Opposition say? They say: 'Let them eat fish'. They are the modern-day Marie Antoinettes. There has been no suggestion as to how those benefits are to be controlled or regulated. The control of prices will of itself, of course, control some incomes. The Opposition has proved by its past policies that it is the architect of disaster. The Leader of the Opposition (Mr Snedden) seeks to place the blame for inflation on its chief victims. He asks the Australian people to place the blame for high prices on those who cannot afford to pay them. The argument of the Opposition must be amongst the most contradictory in parliamentary history. For 23 years members of the Opposition, when in government, argued against any form of economic control. Having gained the economic advantage for the investor they now seek to argue about a freeze.

This is a time when profits are at a record level. Let me briefly refer to the alleged gap between the Prime Minister (Mr Whitlam) and the President of the Australian Council of Trade Unions. This, of course, is absolute rubbish - pure speculation. The President of the ACTU was reported this morning as having said that he did not make a promise and was not going to hand over a promise that wage increases would not be sought. Obviously, no representative of the trade union movement would buy a pig in a poke. No responsible leader can give a blank cheque. What he said was that once price control was introduced we would be 'in a different ball park'. The report goes on to state:

Following the introduction of price control we would have a different position and would co-operate with the Government for maximum possible growth', he said.

That is what Mr Hawke said and, of course, that has been ignored. The proposal which is before this House is for the Australian people to have a say. Price control is worth a fair trial and I believe that the very existence of power to control prices could well dampen down the rate of price increases. There is only one issue before this House arising from this Bill: Should the Australian people have a voice? Should they be allowed to say whether or not this Parliament should have the power to control prices? I support the Bill and commend it to honourable members.







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