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Tuesday, 27 April 1965

Senator BRANSON (Western Australia) . - This debate has proved to be quite interesting iffor no other reason than because the line taken by the Leader of the Opposition (Senator McKenna) and Senator Benn was quite different from that taken in the other place by the Leader of the Opposition (Mr. Calwell) and the Deputy Leader of the Opposition (Mr. Whitlam). Senator McKenna delivered a reasoned speech but his approach to the problem confronting us was not as critical as the Opposition's approach in the other place. In my opinion the foreign investment situation in relation to Australia has improved considerably in the past 24 hours. I should like to start on the note upon which Senator Laught closed. I refer to a statement published in the " Australian " today. I will not repeat it in full but will quote the following extracts which interested me -

The critical U.S. balance of payments deficit dropped sharply in the first quarter and it still is going down . . . The actual situation is even better than the preliminary estimate suggests

.   . The Government's flash reports show that the U.S. achieved a very large payments surplus in March immediately following huge deficits in January and February . . . The most heartening thing about the March upturn is that it is continuing and is expected to continue during the weeks ahead.

That augurs well for the atmosphere in which the Treasurer (Mr. Harold Holt) will present the Australian case. The situation in the U.S.A. has taken rather a dramatic turn for the better. I was interested yesterday to read this comment by Mr. David Rockefeller, President of the Chase Manhattan Bank - i hope there will be only a temporary slowdown and then a resurgence in a period not too far distant.

If the programme is, in fact, successful - and the first quarter suggests that it is - perhaps towards the end of the year there may be a relaxation of restrictions giving recognition to particular situations - and this is important - as in Australia.

In other words there is sympathy for Australia and I shall develop that theme later. Personally, I think we are jumping too many hurdles and crossing quite a number of bridges before we come to them. I do not believe that the United States will do anything to embarrass Australia financially. Strategically, we are very important to the U.S.A. and I do not think it would want to do anything to weaken us. Australia alone in the whole of Asia is populated by Europeans. Tactically and from a defence point of view we are essential to the United States in this part of the world, and I do not agree with the pessimists who overlook that factor.

In trade we are a very good customer and buy far more from the United States than we sell to that country. This was mentioned by the Prime Minister (Sir Robert Menzies) in his letters to President Johnson. The right honorable gentleman said that in 1962-63 we sent to the United States 362 million dollars more than we received from her. In 1963-64 that credit in favour of the United States rose to 441 million dollars. That is the sort of customer we are. In the half year to December 1964 there was a decline of 15 per cent. in our trade to the U.S.A. but America had a rise of 43 per cent. This trend makes Australia a very attractive customer to the United States and 1 am quite sure it does not want to harm us in any way through the measures it has had to take.

Reports in the Press today indicated that the U.S.A. was ready and willing to listen to Mr. Harold Holt and it was thought that he would receive a sympathetic hearing. I do not believe that President Johnson's decisions were directed against us. I appreciate why he did not specifically exclude Australia from those measures. I suppose that he had diplomatic reasons and did not want to offend others where investments were involved. But I am sure that the Treasurer will have no difficulty in convincing the Americans that we have a separate and different case to put forward and I have no doubt that our propositions will be favourably received. I began by saying that in my opinion the approach to this matter in the Senate by the Leader of the Opposition and Senator Benn was entirely different from that of their colleagues in another place. I could not understand the attitude in the other place to the use of foreign capital in Australia. The Australian Labour Party has said to the people of Australia, "We will develop Australia if given the opportunity and we do not necessarily welcome nor do we need outside assistance ". That seems to me to be like a farmer who decides he will develop a block of virgin land. He may have a heart like a lion and all the brawn in the world, but if he sets out alone to develop the land into a productive farm and equipped only with an axe, he will do the job but it will take his lifetime and the lifetime of his sons. That is what will happen if he undertakes the task without outside help. But if he goes to a bank or financial institution and borrows money, he can bring the farm into production and put it on an economic basis more quickly.

Australia as a nation is in a similar position. Certainly we can develop Australia ultimately with our own resources but we have not the time to follow that course. The sands of time are running out rapidly for Australia in relation to its development. Within the next few years - I would not like to say how many - our future and our destiny will be decided. We shall know then whether we are to be a race of free people controlling our own destiny or a nation under Communist Chinese control. The approach of the Australian Labour Party to our future, particularly in another place, is unrealistic. We have not the time to try out some Socialist experiment.

I personally welcome overseas investment and American capital. We must remember that the U.S.A. has never knocked back one penny of foreign investment. When Australia was founded, the United States had a population of some 7 million people. In the time it has taken us to grow to 12 million, the United States population has grown to 193 million. This was done through hard work. The Americans were prepared to take a chance. They had imaginative policies and a massive immigration programme and they accepted foreign capital wherever they could get it. They never knocked back a penny of foreign capital to develop the country's resources. If we only knew for certain that we had 1 00 years, 50 years or even 25 years to develop the northern part of Queensland, the Northern Territory, or the northern part of Western Australia, then I might listen to the argument of honorable senators opposite. But wc do it through our own resources.

Senator O'Byrne - We do not stay out of the wars.

Senator BRANSON - I say to you, Mr. President, and I say to the honorable senator who is interjecting at the moment, that we know and he knows as well as I do that no-one can give us that assurance that we have 25 years, 50 years or 100 years to develop this country.

Senator Cavanagh - It would take 500 years with the honorable senator's approach.

Senator BRANSON - That is how the honorable senator thinks, but the electors have not thought so for the past 16 years. Because the sands of time are running out and we have to develop rapidly, and because we cannot do this from within our own resources, we have to invite and woo risk capital from outside Australia. Where would our oil exploration activities be today if there were not overseas investors in oil here? 1 know what honorable senators opposite would do. They would have a massive campaign with a Government oil exploration scheme about as successful as the original one the rig from which was finally sold and used in Western Australia. It must be remembered that we on this side of the Senate - and I say this with great respect to my friends on the other side - approach these problems with an entirely different attitude from that of honorable senators opposite. That is why there is a Government and an Opposition - because we think differently. I have read the speeches of all the Opposition members in the other place who spoke on the subject we are discussing tonight.

Senator Ormonde - Has the honorable senator read the speech by the Minister for Trade and Industry?

Senator BRANSON - No. I did not read the Minister's speech; no more did the honorable senator.

In every speech by Opposition members in the other place there were the words " control ", " direction " and " planning " used by some of them ad infinitum. This is understandable because that is the proper approach of anyone who believes in the planned socialist state, which, of course, the Australian electors will not have a bar of. They have rejected it in six elections.

Senator O'Byrne - And look at the mess they are in.

Senator BRANSON - That is a stupid statement coming from a mature, sensible man as the honorable senator is. Australia and Australians have never been better off and the honorable senator knows it. Sometimes I wonder whether, perhaps, the honorable senator thinks .that is a bad thing. 1 do not. I think it is a good thing. As I said, Australians will not have a bar of this policy of planned socialism. They have rejected it over the last 16 years in no uncertain way.

The honorable member for Melbourne Ports (Mr. Crean) in another place even went so far as to say, and I quote from page 784 of " Hansard " of 8th April 1965, that Unilever (Aust.) Pty. Ltd. - this is a private company - had decided that in future it would manufacture soap, not in Melbourne but in Sydney, whilst the Melbourne side of its activities would manufacture food. He went on to say -

The Commonwealth Government apparently is doing nothing to stop this sort of thing.

He said that the Commonwealth was doing nothing to stop a factory in Melbourne deciding to manufacture soap in Sydney and foodstuffs in Melbourne.

Senator Cavanagh - The honorable senator is quoting him out of context.

Senator BRANSON - It is here. Senator Cavanagh can read it for himself. I am not quoting it out of context at all. It is in " Hansard " of 8th April and the honorable senator can read it. When the honorable member for Melbourne Ports said -

The Commonwealth Government apparently is doing nothing to stop this sort of thing- it is obvious to me from that statement that if Labour were in government it would control and direct where companies would operate. I have no doubt that the honorable member for Melbourne Ports would not be a backbencher in any government the Labour Party formed. I have no doubt he would be in the Ministry. I say in all seriousness to those people who are interested in commerce and manufacturing that they need to have a look at this situation because, in the words of the member for Melbourne Ports, a Commonwealth government should interfere and direct companies as to what they produce and where they produce it. I quoted his remarks from " Hansard " and I have given the date and the page.

I refuse to be scared or frightened by the exchange of letters between the Prime Minister and President Johnson because I do not honestly thing that the restrictive measures are directed against. Australia. I do not think this matter rates anywhere near as important as ,the events which are taking place to the north of us. I think that this matter has been taken out of its context and its order of priority and been blown up to something that is nowhere near as important as I hope time will prove. I. do not think it would matter a hoot if not one more dollar or one more pound sterling was invested in Australia if we only knew that we were safe for the next 50, 75 or 100 years. If we know that, we would have the time to go along quite slowly - and it would have to be slowly if we were going to develop from within our own resources - but I am sure there is not one honorable senator in this chamber who believes that we have the luxury of that amount of time. I do not believe it. We just cannot keep up our expansion, development and immigration programme from within our own financial resources. I am in complete agreement with the Treasurer because he said-

Senator Ormonde - The Treasurer does not agree with the honorable senator.

Senator BRANSON - I do not have to agree with the Treasurer on all things and Senator Ormonde knows that I do not. If I have an opinion of my own, I express it. I find myself in agreement with him on this matter. The Treasurer said -

Australia remains a largely underdeveloped and underpopulated continent. We do not have unlimited time in which we are left free to populate our country and exploit its resources.

This is what I am trying to substantiate in my argument.

We can speed these processes by the additional resources which come to us from overseas. Whatever risks we accept in encouraging this investment on however substantial a scale, they are of minor order when set against the risks we run if we fail to populate and develop our country as speedily as we can.

In other words, the Treasurer said what I have said: The sands of time are running out. We have a task to do. I think it is beyond our own resources to do it at the pace we want to do it. So, we have to seek some assistance. Despite all our critics, Australia as a nation is not doing too badly.

Senator Ormonde - At government level we could improve things.

Senator BRANSON - I remind Senator Ormonde that the overseas investor is not the big bad bogyman that the honorable senator would have us believe. That point is covered in " Hansard " of 8th April 1965 at page 779, where the Treasurer says - . it has been the Australian experience that the companies established here have ploughed back a very considerable proportion of their Australian earnings, and no group of investors has done this more than have investors from the United States.

Senator Bishop - Those are not the honorable senators words?

Senator BRANSON - No. I am in all agreement with this statement. I think it is correct. It continues -

Taking the inflow from 1947-48 to 1963-64 by domicile of investors, we find that the undistributed income is 41.2 per cent. in the case of the United States and Canada. That is quite thehighest percentage of any of the countries listed with us and it shows that a very considerable proportion of the profits earned in Australia are ploughed back, giving additional employment and added industrial strength to the whole economy.

Senator Cavanagh - They still take a lot out.

Senator BRANSON - Yes. But I am saying that these investors plough back 41.2 per cent. of their profits into expansion which has provided vast employment which both Senator Cavanagh and I would want to see.

Over the last 16 years, if we look at this matter without being biased - and I know that is practically impossible for a politician or a member of Parliament to do - we will see that we have been bringing to Australia some 150,000 migrants a year. In recent years the growth in our national income has been approximately 5 per cent. which is better than the growth in most countries of the world today. We have also established standards of living and standards of housing -

Senator HENTY (TASMANIA) - And of employment.

Senator BRANSON - Yes, I am coming to employment in a moment. We have established standards which are much better than those of most countries in the world today. They are a source of pride to every Australian and matters of envy to most people who live outside this country. At the same time as we are continuing our immigration policy, keeping full employment and lifting our national income by 5 per cent. each year we are facing up to the gigantic task of developing one of the largest tracts of country in the world. We are doing all this and, as the Minister for

Civil Aviation (Senator Henty) has reminded me, we have the lowest unemployment figure of any country in the world today. We really have no unemployment. In fact we have - I hate to use the term, but it has become customary and I know of no other suitable term - over-full employment in many industries in Australia today. This represents a mighty effort on the part of the Australian people. They are the ones who are doing it, but they can do it only if they are receiving wise and sound guidance from their Government. The Australian Labour Party put forward in another place the argument that we should cut down on private investment. This was advocated vehemently by some Opposition speakers. I ask them seriously - indirectly through their colleagues in this chamber - to say what activities they suggest we should cut down on if we are to cut down the amount of money which makes such things possible. Is the cut to be in the field of employment? I am sure no one would want that. Is it to be in the field of social services? I do not think anybody would want that. Is it to be in the field of development or of the national growth rate, which I mentioned earlier? Are we to halt investments such as those that are maturing at this moment in the iron ore industry in Western Australia? Are we to stop the activities of the oil companies that are exploring for oil? Oil imports represent one of the biggest drains on our resources of overseas funds. Are we to stop refining oil in Australia? Finally, are we to stop the inflow of capital which assists all these activities and permits us to retain the high standard of living which we are enjoying today?

I could not sit down without referring to what the Leader of the Opposition (Mr. Calwell) said in another place. I think the honorable member for Higinbotham (Mr. Chipp) summarised it very well when he said -

We got this pearl from the Leader of the Opposition: " We would direct " - that is a favourite word with him - " both foreign and local capital into the most productive of channels." Let the business community hear these words and understand what they mean. This is direct advocacy of the re-introduction of a capital issues control board, to tell people where they might invest their money and where they might not. The honorable gentleman then said, rather amusingly: "There is no need to go to the United States of America. We could probably raise ail the capital here ". He said: " We raise four-fifths of it here now. Why cannot we raise it all here?".

Mr. Chippwent on to say ;

But let me quote one example, oil - and one could quote many from the evidence which the Department of National Development, through the Bureau of Mineral Resources, recently gave at a Tariff Board inquiry on crude oil. It had this to say about Australia being self-sufficient in oil or petroleum products -

The minimum reserves required to support production are commonly regarded as equal to15 years production. If Australia is to become self-sufficient in oil, therefore, reserves of at least 2,000,000,000 barrels are required now and by 1970 about 3,000,000,000 barrels.

It went on to say later -

Assuming a future discovery cost of 10s. per barrel of reserves, the cost of finding our required reserves by 1970 should therefore be about ?1,500,000,000.

That is five years hence, and ?1,500,000,000 is a fantastic figure. 1 wonder whether the Leader of the Opposition does believe that that kind of money can be found in Australia in five years.

Senator Cavanagh - He may not accept the figures.

Senator BRANSON - He might not accept the figures, but I have quoted the source of these figures. This information was given in evidence by the Department of National Development, through the Commonwealth Bureau of Mineral Resources, before the Tariff Board. I do not know that I would doubt figures given by the Bureau of Mineral Resources. What reason would it have to put false figures to the Tariff Board? It would have none. On the figures I have quoted, we would need ?300 million a year over the five years for one project alone - oil exploration. I have not time to read from other publications in which we see quoted projects such as,Alcoa, ?150 million; Comalco, ?53 million; and the Gove mining organisation, ?100 million. I wonder whether anybody really seriously and honestly suggests that, with all our commitments and with all the factors involved in expanding a young and growing nation, this sort of money could be found in Australia. I cannot believe that it is available.

If we are to do these things in the time we have left in which to do them in Australia we have to borrow from overseas. As I said earlier, we must borrow like the farmer has to borrow to develop hisland. Without assistance, he can develop his land in his lifetime and his son's lifetime, but he can do it a darned sight quicker if he can get assistance. Of course the Australian economy has its problems, but so has the economy of every other country. That is why we are debating this subject tonight. America has her problems, Great Britain has her problems, and so have we. But let us remember that we have a very high rate of growth and expansion in this country and that we have maintained a standard of living that is the envy of most people in the rest of the world today. The Government has had some pretty savage critics who have accused us of having a stop and go policy I refer to critics both inside and outside the Parliament. I wonder whether they are perhaps disappointed and a little dejected because the economy is avoiding the disasters they have predicted.

Senator Bishop - The honorable senator is starting to worry now.

Senator BRANSON - It is only a matter of a few months ago, Senator Bishop -

Senator Aylett - You are gloomy now.

Senator BRANSON - The honorable senator was not here earlier, when I said that I am quite optimistic. It is only a few months ago that the Treasurer (Mr. Harold Holt) brought down a Budget that the Opposition said would be the worst Budget of all time. Look at the financial news in the newspapers today. Looking at the most recent figures, in respect of the last quarter, 1 am sure every fair minded person is utterly delighted to see that we were holding costs in this country. It is easy, sitting on the Opposition side of the Parliament, to criticise the people who hold our economy together and make Australia a good place to live in. Honorable senators opposite have no responsibility for the economy. It is the people sitting on the Government front benches who are charged with this duty. If honorable senators opposite were fair minded and would forget politics - I know that is hard to do - they would admit that the Government has done a good job. I am sure that when the Treasurer returns from America, as he will, I hope, shortly, he will have good news for us.

Senator Dittmer - You are hoping he will bring good news.

Senator BRANSON - I am sure he will have good news. The present indications are that this will be so. I am fortified in my optimism by what President Johnson said in his letter to the Prime Minister (Sir Robert Menzies). He said- -

In the present instance, we believe after careful review that our Balance of 'Payments programme is not likely to have a serious adverse effect on the Australian economy. . . We believe therefore that this programme will not impose undue strain on Australia. But it is always possible that specific action under a programme of this sort can have consequences for a friend that outweigh their value to the general programme.

It has been reported that the Americans are prepared to receive the Treasurer with sympathy and understanding. The President continued - 1 have asked the Secretary of the Treasury and the

Secretary of Commerce to give a careful hearing to Australia's view in any particular case which might be of this sort.

Honorable senators opposite who are attempting to interject would be squealing now if the Treasurer had not gone overseas. Urgency motions would have been raised in this House if he had not gone. I have said before that you cannot win against the Opposition. I appreciate that it is the task of the Opposition to keep the Government on its toes, but when honorable senators opposite interject they should not mind if I bite back. The Treasurer has gone to the United States as our capable representative. He has with him a team of people for whom I have great admiration and respect. I am sure he will put forward the best case possible. I am still optimistic that the American situation has taken a turn for the better, as evidenced by earlier statements I have made. I am sure that Australia will not suffer the dire effects that some people would have us believe are in store.

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