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Tuesday, 9 October 1973
Page: 1772


Mr HALLETT (Canning) - There are a number of Bills before the House at the moment but, summed up, their effect is to increase costs to the community throughout Australia. Although the honourable member for Blaxland (Mr Keating) may have said that the Government had a mandate not to increase personal taxation the Government increased taxes in general, not from the right-hand pocket of the taxpayer but from his left-hand pocket. The measures now before the House increase taxation payable by people now residing in this country. The honourable member for Blaxland mentioned also that the Government proposes to spend a considerable amount of money on education. But of course what he failed to mention was that the Government had taken from the States certain responsibilities in relation to some areas of education, that it had deducted from payments to the States the money which would have been involved and that it had added this amount to its own Budget. The honourable member mentioned also that the Government was pouring additional money into the field of housing. He is now leaving the chamber. Apparently he docs not want to listen.

The Government has done those things, but what is the net result of its actions? The Government has imposed extra taxes, as has been mentioned today, in relation to housing. The result of this is that there is a drastic shortage of builders in this country and there is a drastic shortage of bricks and so forth with which to build houses. In addition, the Government has turned around and increased costs to people seeking private dwellings through very savage increases in the rates of interest. On a $10,000 loan repayable over 30 years the increase in the rate of interest will amount to something like $2,500 - on one home. That increase is quite apart from the effects of the increased costs across the board. That action is what this Government terms as good economics. In my book it is bad economics to bring home owners in this country into the position in which we see them today.

The third point made by the honourable member for Blaxland related to the price of fuel which is the subject of this debate. He referred to the fact that through one source or another fuel is cheaper in the cities of Sydney and Melbourne. I cannot help mentioning again that many members on the other side of the House seem to think that this country starts and finishes in Sydney or Melbourne. As I said in this House a couple of weeks ago, a tanker can be brought into Melbourne or Sydney and distribute fuel in most centres somewhat more cheaply than would be the case if the Government accepted the responsibility of distributing the fuel requirements of users throughout the entire continent. That is the vast difference. What this nation wants is fuel depots right throughout the country to supply fuel when it is required. That is an entirely different exercise from just dumping fuel in the 2 large cities in this country, Sydney and Melbourne. It seems impossible for those honourable members on the other side of the House to get that message. There are industries throughout this country which make the wealth of this nation. In fact the Government is at the moment living on our current account which was put together by the previous Government from our production. As you well know, Mr Deputy Speaker, the previous Government had begun to pay our way in the current account in the middle of 1972. It is that money which is now carrying this Government through and it is through those services of which I have been speaking that the nation has been enabled to achieve that position. The money does not come from Sydney and Melbourne; it comes from throughout the nation.

Of the Bills now before the House I will speak mainly to those relating to fuel. These fuel Bills are important to this nation. They increase the cost of diesel and other types of fuel by 5c a gallon. This is a tremendous increase in costs as it affects industry and private users throughout the country. The Treasurer (Mr Crean) in his Budget Speech on 21 August mentioned that in a full year the increased fuel charges would give an amount of SI 57m revenue to the Government. That is quite a lot of money. To suggest that an increase in the price of fuel which will achieve that amount of money is not inflationary - in other words, it is not going to put up costs - is quite ridiculous. Of course it will put up costs. Road transport in this country is a very important industry. Other means of transport are limited. The areas in which railways operate for the transport of goods and the areas in which goods are carted even by air are limited. Although those industries will also be affected by these increased fuel charges, it is the road transport industry which in the main will be affected. The road transport industry is of considerable magnitude in this country.

This industry will also be affected by another measure which we expect the Government to introduce very shortly. I refer to the Bill to amend the Commonwealth Aid Roads Act which to some extent is coupled with these money Bills.

Spread over the last 5 years I think the previous Government made available to the various States a sum of SI, 252m. One would expect that with the substantial increases in fuel taxes and the increases in the amount of fuel being used throughout this country, the Government would have available to it substantial additional money for distribution to the various States for the purpose of building roads. The Commonwealth contribution to road construction throughout the nation amounts to about one-third only of the total expenditure. It will be interesting when that Bill comes before the House to see what amount of money is in fact made available to the States from this additional revenue because it was said on numerous occasions in this House when members of the present Government were in opposition that the full amount of revenue collected from these areas should in fact be made available for road construction purposes. I doubt very much whether that will be done because one speech made in this House this afternoon from the Government benches indicated that the reason for these taxes was for other things such as education, health, home building, etc. So, it has been indicated that the money raised from these taxes will be channelled into another area and not into that area which was suggested by the Government when it was in opposition. No doubt, that Bill will come before the House; I hope it will be in the near future. However, I think it is time that the Government spelled out its policy in relation to these matters because a lot of local authorities throughout Australia are anxious to know precisely what is the Government's policy in relation to the renewed Commonwealth roads legislation. These authorities must budget each year, just as this Government must budget each year for its works program.

An important angle relating to fuel generally and to the discussion now taking place is the supply of fuel in this nation. Previously, we had incentive programs to attract to this country people, industries and businesses with their know-how and capital in an endeavour to find fuel. But in recent times - in 1973 - the enthusiasm to drill for oil in this country seems to have waned. It is noticeable that on 10 October 1972, 18 wells were being drilled, 7 off-shore and 1 1 on-shore.


Mr O'Keefe - They should be putting them down like pins in a pincushion.


Mr HALLETT - I agree with my friend, the honourable member for Paterson. On 9 October 1973 - that is, today - we have only 12 wells being drilled, 6 off-shore and 6 onshore. In other words, we are going downhill fast when it comes to finding fuel in this country.

We also hear of meetings taking place in the world relating to fuel costs. Only this week there was a meeting in the Middle East, where about 80 per cent of the total oil reserves are held. I have no doubt that those countries will be seeking a substantial increase in the cost of fuels. If we in Australia do not increase our search for fuels and bring to the surface sufficient for our own needs, we will be subject to those negotiations and will be paying substantially more for fuel than otherwise would be the case. The Minister for Overseas Trade (Dr J. F. Cairns) who is sitting at the table interjected earlier to ask in what area the Government should cut back its expenditure if it were not to increase taxes under the measure that is now before us. Of course, honourable members opposite always mention social services, health and education programs. Nobody is suggesting that we should cut back those programs. However, there are areas which the Government should have left alone. For instance, the national pipeline has been mentioned. Private industry was willing and able to carry out this project and, in fact, has started the program of installing the necessary pipes for the distribution of natural gas. But the Government took over.


Dr J F Cairns - Would private expenditure be less inflationary than public expenditure?


Mr HALLETT - It is inflationary because the Government apparently is determined to take over from private enterprise and to tax the people or get the money from somewhere - we are not quite sure where all the money is going to come from; I wish the Government would tell us - and then spend it. I have never yet found government expenditure of this nation or of any other nation that is as economic as expenditure by private enterprise. This Government certainly would not be as economical as private enterprise. Can it be suggested that this Government could take over all the private enterprise in this country and be as efficient as private enterprise? It follows that if the Government starts taking over one area of private enterprise, it is going to take over the lot. Australia has some of the most efficient areas of private enterprise in the world. God help the day when this socialist Government takes over from those private enterprise organisations. I would challenge the Minister for Overseas Trade on this point. If he wants to cut back expenditure, he should start with government expenditure. Do not expect private enterprise, as the Government is doing with its monetary measures, its interest rates and so forth, to come to the party and try to cut back when the Government itself is not making any effort whatsoever to cut back on its program of expansion in endeavouring to take over private enterprise.

There are many examples I could give relating to the taxes we are now discussing, for that is what they are; they will place further burdens on the individuals and industries throughout this country. I should like to cite figures relating to a couple of these increases. The cost in a full year of the increase in duty on motor spirit alone will be SI 34.6m and the increase in duty on diesel fuel in a full year will raise SI 2.9m. They are substantial increases in anybody's language. It is not just upon the country people who use this fuel that the increased costs will fall, as one might think. Honourable members opposite seem to forget that we have to transport all the necessary foodstuffs to the millions of people who live in the cities of this country. A lot of this food must come many hundreds of miles and, obviously, when transport costs are increased, the cost to the consumer is increased by the time the food reaches its destination. As 1 have said before, transport costs are the biggest single factor in our cost structure and such costs are coupled with the increased fuel taxes we are discussing. Of course, the Government has a responsibility to carry out its mandate. Whether the people will be happy with the way that that mandate is carried out probably is another matter altogether. I cannot agree that an increase in fuel costs of 5 cents a gallon, plus additional increases of up to 1.7 cents a gallon for country areas over and above the amount of 3.3 cents a gallon which was contained in previous legislation, making a total increase in many country areas of nearly 7 cents a gallon, is justified. It is far too high a price for anybody to have to pay in increased costs in one year.

We notice these increased costs every day. Costs are moving up in every area. One has only to ask the housewife, who is the best economist in the country, to see the truth of this. The housewife has to make her dollars stretch each week to purchase the requirements of the family and the home and when housewives find that these costs are continually moving up, every day and every week, as they have been doing in more recent times, they will start to think about the policies which the Government is implementing. There has also been a rapid across the board increase in interest rates. I thought that the Government stood for a policy of low interest rates. However, the very reverse is the situation. Interest rates are the highest we have seen. Again, this increases the prices of goods right across the country. These are the things that the housewife is now finding out in her daily economics.

I feel that the Government could and should have cut its expenditure in this Budget. An increase in Government expenditure of 18.9 per cent is far too high in the inflationary situation in which we find ourselves today. In my book, these measures only tend to increase that inflationary situation and do not in any way assist the economy of this country.







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