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Wednesday, 19 April 1972
Page: 1252

Senator LITTLE (Victoria) - The Democratic Labor Party supports the Bill. We are particularly pleased that the Government, in making the adjustments on this occasion, has seen fit to give some attention to the means test category of pensioners and to put them back in their rightful position. As we have stated during debates on successive budgets, they should not have been placed at a disadvantage when the pension increases that have taken place in recent times are taken into consideration. I must comment that it seems remarkable that the suggestions which we put and which were unacceptable to the Government only last August, after there has been a period of restriction of the economy which caused unemployment figures to rise and which created a sense of instability throughout the whole of industry, are suddenly acceptable and the economy has suddenly become flush enough for the Government to be able to afford to do the things that we suggested were within the compass of the national expenditure last August.

There must have been a realisation by the Government that the economy was not developing in the way in which it should under the restrictions. Perhaps some of the other steps that the Government took to control inflation, such as a reduction in interest rates, may be proving more effective than trying to impoverish and draw back the whole of the economy as a restrictive measure. I would confidently predict that if the Government pursued a policy of bringing Australian interest rates more into line with those of countries with similar economies the Government would find that still more of the problems of inflation would be gradually brought under control. As I have said to the Government time and again - we think it has been shown by the trend that the economy has taken - one of the major causes of inflation was the medicine that the Government was pouring into the economy. It was increasing costs by increasing interest rates. That idea is supported only by particular schools of economists and certainly not by all economists. It can never be shown that the practical effect of increasing interest rates has been to bring back under control an economy which is suffering from an inflationary spiral. Increasing interest rates merely adds to costs and impoverishes organisations that have debited finances. I refer to local government organisations whose main source of expenditure is the interest that they have to pay on the loans which have accrued and which have to be renewed because the organisations have not the money to repay them. The loans have to be renewed at double interest rates.

Having said that and having indicated our general approval of the Bill,I must say the only other thoughts that our Party would have are that perhaps the manner of the introduction of the Bill is further proof that ultimately some government with the wisdom to accept the Democratic Labor Party's advice will set up an independent tribunal to decide these matters, will accept the recommendations when the independent tribunal makes them and will see that it is able to finance what is reasonable to give our pensioners a proper standard of living. Then we will not have a political football thrown into the ring very suddenly and with little time to see whether it is a football that we can kick around. I feel that if ever there was proof that pensions can become a political football, it is when whe have to consider Bills of this character in the circumstances in which we are considering this Bill tonight. We will do everything possible to see that it has a speedy passage through the Senate.

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