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Tuesday, 27 April 1965

Senator KENNELLY (Victoria) . - May I say at the outset that I greatly regret the opening remarks of Senator Cormack. I thought that the debate had been conducted at a pretty high level and I regret that a Victorian colleague should bring it down to the Russian-Chinese level. This point is always raised when the Government is in trouble. Senator Cormack surprised me as I thought he would be the last one to descend to that argument in order to bolster his case. I do not think that Senator O'Byrne, any member of this Parliament or anyone in this country would wish Australia to borrow from China or Russia, even if such a loan were available. I am not only surprised but hurt, knowing Senator Cormack as I do, to find that he would descend to that level.

Quite a number of remarkable statements have been made during this debate. As a rule we do hear remarkable statements - perhaps extravagant statements - when the Government finds itself in a predicament such as it is in on this occasion. One Government supporter when referring to immigration said that last year we brought into this country 150,000 immigrants. I ask him to examine the net figure and he will find that he is out by many thousands. I remember reading that about 140,000 people came here, but we are entitled to deduct from that figure the number of those who left Australia and the number of Australians returning from abroad who have been absent from this country for two years. It would be interesting to learn the net figure. Tomorrow, if I remember, I think I will put a question on the notice-paper so that we may learn what is the net figure. I should think that anybody who takes an interest in immigration would appreciate that the figure quoted by the honorable senator is very wide of the mark.

Senator Cormackseemed to me to complain about the Minister for Economic Affairs in Great Britain writing to hundreds of companies, bringing to their notice that they had undistributed profits in foreign interests and suggesting that in Britain's economic hour of trial they should bring those profits home. The honorable senator cannot altogether blame a government for requesting that that be done. If the Minister for Economic Affairs believes - no doubt he does - that the bringing home of undistributed profits will help to alleviate the economic plight that the present British Government has inherited from its predecessor, then unfortunately we will be affected. I, too, would prefer that not to happen. One would have thought that the economic advisers to this Government would have had sufficient knowledge of the economic situation in Great Britain to know that sooner or later steps would have to be taken to save the £1 sterling. I am somewhat at a loss to know why anybody should complain about the government of another nation taking steps which it believes to be in the best interests of the people that it has been elected to govern.

My friend opposite has stated, in effect, that the workers should not apply to the Commonwealth Conciliation and Arbitration Commission for a fair share of the profits that are derived from the goods that they make. For one, two or three years - I stand to be corrected if the period is longer - the Government had a hold on the cost structure of this nation.' Like others, I was very pleased that our cost structure remained comparatively stable for a period. It was not exactly stable, but was as stable as one could wish. However, in recent months it has not been stable. In the last quarter the cost of living in my own State of Victoria rose by half a crown. What does the Government expect the workers to do in the light of that fact? Does it expect them to be the only ones to tighten their belts? Are the workers not entitled to at least a fair share of the profit that is derived from their production? They will be lucky if they are granted a fair share, but surely there is no harm in their submitting a claim for it.

The Government cannot say that it has not been warned that sooner or later the effect of the importation of capital into Australia would have to be faced. This matter has been discussed at length in the Senate on at least three occasions. Figures released by the Commonwealth Statistician show that what he describes as investment income payable overseas by companies in Australia amounted to £97.6 million in 1962, to £127.8 million in 1963, and to £133.2 million in 1964. New direct investment in those years respectively amounted to £78 million, £126.1 million, and £131.7 million. It will be noted that in those years dividends paid overseas from investments in this country totalled £358.6 million as against new direct investments amounting to £335.8 million. In other words, there was a difference for those three years of £22.8 million. The bigger the industries in question grow and the more profits they make, the greater will be the extent to which they outstrip new investment. I say with great respect to Senator Cormack that this must affect our balance of payments situation. In the three years before President Johnson took action, the situation was affected to the extent of £22.8 million. To say that the repatriation of profits overseas has no direct effect is wrong.

Senator Cormackmentioned two British companies that are raising extra financein Australia. The same can be said of companies that have their headquarters in the United States. If these companies cannot get finance from the normal financial institutions of this country, they will pursue other means of getting it. For example, the General Motors Corporation has placed advertisements in the Press asking people to invest in that undertaking. Such an approach has two faults. First, it means that we do not get the investment capital that helps to correct our balance of payments situation. I am not blaming the Government for the position, but the facts are that ever since it came into office, there has been a difference of about £1,800 million between the value ofthe goods that we import and the value of the goods that we export. We have only been able to build up reserves of £700 million in London because of the investments that we have received from overseas. I think that we have borrowed about £800 million overseas, on which we pay £40 million a year in interest. I ask for leave to continue my remarks at a later stage.

Leave granted; debate adjourned.

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