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Wednesday, 24 October 1956

Mr DRURY (Ryan) .- I was rather surprised and disappointed to hear the honorable member for Bonython (Mr. Makin) making a personal attack on my colleague, the honorable member for Sturt (Mr. Wilson), and virtually accusing him of being insincere in relation to the matter of social services.

Mr Makin - I did not say that.

Mr SPEAKER - Order!

Mr DRURY - I understand the honorable member for Bonython to say that if it came to the point the honorable member for Sturt would refrain from voting on any legislation designed to improve the lot of the pensioners. Now, sir, I feel that such a statement is not only unfair but also inaccurate. During the years that I have been in this House, no one has been more assiduous or, I believe, more sincere, in his efforts to urge the Government to adopt measures for the benefit of pensioners and the other less fortunate sections of the community than has the honorable member for Sturt.

Government Supporters. - Hear, hear!

Mr DRURY - The exclamations of " Hear, hear! " from the Government benches merely serve to support my contention. Nothing is gained by a personal attack of the kind indulged in by the honorable member for Bonython, and I was personally very sorry to hear it. I believe that there is no more humanitarian person in this House than the honorable member for Sturt.

Now, Mr. Speaker, it would be rather difficult to deal piecemeal with the points put forward by the honorable member for Bonython, and I shall merely make reference to two or three of his major arguments. In the first place, he suggested that this bill provides concessions for the wealthier sections of the community. I do not believe that this is so. and I do not know of any substantial facts that bear out such a contention. The honorable member used, as the main fulcrum of his argument, Mr. Speaker, the particular clause of the bill relating to the increase in the maximum deductions, for income tax purposes, on account of superannuation and insurance payments. It is true that the maximum amount is proposed to be increased from £200 to £300, but I believe that the benefit therefrom will be derived not by a single small section of the community, but by a large number of persons. There is a vast middle-income group, which perhaps I should call the small businessman group, which comprises a great proportion of the overall population; the members of that group will be very pleased to avail themselves of this increased concession. The

Government has been urged to increase this benefit, not by the representatives of any one particular class of persons, but by many sections of the community. It is very pleasing to find that the Government has acceded to these requests.

The honorable member for Bonython said, in effect, Mr. Speaker, that this Government is really not interested in the plight of pensioners. Indeed, I think he said that 80 per cent, of the people derived no benefit from legislation of this kind. If one were prepared to take part in a detailed debate on the matter of social services benefits, and the record of this Government in the field of social services during the last seven years were compared with the record of the Chifley Government in the last seven years of its regime, it would be found that, even allowing for the variation in the cost of living, this Government has done substantially more for pensioners than the Labour government did.

Mr Ward - That is just rubbish! Of course, the honorable member knows that.


Mr DRURY - Not only has the total amount of pensions by this Government been greater than that paid by the Labour government, but the pension rate has been increased more times than it was during the period when Labour was in office. Nobody knows that better than the honorable member for East Sydney (Mr. Ward), who is chipping in merely for the sake of being heard.

The attack on the Government has not been supported in any way, either in regard to its social services record or its general humanitarian outlook. As the honorable member for Bonython made some special reference to hospitalization and medical services, may I contrast what this Government has done for the community in that field with what was done by the last Labour government. The Labour government made unsuccessful and abortive attempts to introduce a national health scheme. Under the present Government a most successful national health scheme has been implemented. It cannot be gainsaid that this scheme is benefiting a very substantial section of our people.

Mr SPEAKER - Order! The honorable member must get back to the bill. This is a measure to amend the law relating to income tax.

Mr DRURY - I beg your pardon, sir. I made reference to that only because of some remarks that were made by the preceding speaker. This rather technical and complex measure is designed to give effect to proposals that were outlined by the Treasurer (Sir Arthur Fadden) in his budget speech on 30th August. It goes some way to meet recommendations from various sections of the community, including one very well-informed section, representing the taxpayers of Australia as a general body. I refer to the delegates to the Federal Tax Conference that was held in Hobart in May of this year. I am pleased that the Treasurer has seen fit to go at least some way towards adopting some of the recommendations of that conference, because I believe that the report of the conference shows that the delegates went very fully into all aspects of taxation. I am dealing in particular, of course, with the aspects of taxation that are dealt with in the bill. An analysis of the recommendations of the conference and of the proposals contained in the bill will show, 1 think, that the Treasurer has given some consideration to those recommendations.

Over a period, the income tax laws of this country have been considerably simplified by this Government. That does not mean that they cannot be simplified still further. I believe that this measure will go some way towards a further simplification of our income tax laws and also towards the removal of anomalies. That point has already been made by my friend, the honorable member for Sturt (Mr. Wilson). Many valuable concessions in the income tax field have been granted by this Government in the last few years. It is very pleasing that, even at this time of inflation and rising costs, the Treasurer has been able in this measure to offer further concessions to the taxpayers. Despite what honorable members opposite have said, I believe that the measure will be welcomed generally in the community and that it will benefit a great number of people, directly and indirectly.

In view of the detailed, complex and technical nature of the bill, it is not possible for me in the time at my disposal to deal with all of the clauses, or even with all of the main clauses, but I shall refer to a few of the principal features. First, I congratulate the Treasurer on clause 4 (a), which provides for the exemption from income taxation of hospital benefits organizations and medical benefits organizations. I believe that this provision will be of great value to those organizations, which are rendering a very useful service, particularly to the family man. Speaking as a family man who knows something of the financial burden involved in the upkeep of a home and the education and maintenance of children, I feel that the Treasurer is on the right track in doing everything that he can to alleviate the financial difficulties of the family man. This is one way in which he has seen fit to do so. The bill provides for a refund of income tax as from 1952 to the various registered medical benefits organizations and hospital benefits organizations. I think that that is a worth-while provision.

Clause 4 (c) relates to the Fulbright scholarships, to which 1 want to make a passing reference. We read in the press these days quite a lot about the Fulbright scholarships and the exchanges of scholars, teachers and lecturers between this country and the United States of America. Those exchanges are of immense importance and of great value, doubtless to us and probably to the other country concerned. The Treasurer has explained that he has considered it necessary to make legislative provision for a matter which previously was taken for granted. The reciprocal arrangements in relation to the exemption of grants from income tax will be given legislative authority and, in that way, formal recognition will be given in this country to a provision in article 1 3 of the agreement which was taken for granted in each of the two countries. [ want to say something about clause 5, which must be considered in conjunction with clause 13. Clause 5 provides for the exemption from income taxation of the pay and allowances of members of the defence forces serving in certain areas. This is an important clause, because it will remove an existing anomaly. Honorable members will see that the clause provides that as from 1st July, 1955", naval personnel serving in certain areas referred to in the bill shall be exempted from income tax. That exemption, however, will continue only until the royal assent has been given to the bill. Then the exemption from income taxation granted to naval, air force and army personnel serving in those areas will cease and a special allowable deduction of £180 a year will be granted to them, putting them in the same category for taxation purposes as people living in zone A. I shall say something later about concessions to taxpayers in zone A.

Clause 7 is important, particularly for business men, because it provides for a system of balancing adjustments of depreciating assets. I should like to make a passing comment on clause 9, which must be considered in conjunction with clause 20. Clause 9 deals with expenses relating to the grant of patents, copyrights and designs, and clause 20 deals with allowances for depreciating assets, referring, in particular, to access roads for the timber industry. The clauses are complex, but I feel it is important that they be explained as fully as possible and understood as clearly as possible. Clause 9 proposes that a taxpayer shall be allowed to deduct for income tax purposes all expenditure incurred by him in obtaining the grant or renewal of a patent, registered design or copyright for use in the production of assessable income. It is complementary to that part of clause 20 which relates to the deduction of capital expenditure on industrial property in the form of patent rights, registered designs and copyrights.

In passing, Mr. Speaker, I should like to make some reference to a suggestion which I advanced in this House a considerable time ago in relation to patents, copyrights and designs. It was a suggestion which, I feel, is worthy of consideration by the Government. It may be remembered that I suggested the Government should consider granting prizes or awards for inventions in peace-time. I believe that a great deal could be achieved in industry and in many walks of life if more encouragement and greater incentives were given to people of an inventive turn of mind. I believe that people should be encouraged to think up new ideas and to patent them. 1 should be very pleased indeed if the Government gave some consideration to my suggestion that in peace-time it should do as it does in war-time - that is, grant special prizes or awards for worth-while inventions. Any inventions that would increase productivity, help to make industry more efficient or improve the national economy would be well worth while.

Gifts of £1 or more to certain very worthy institutions, which are set out in clause 11, are to be allowed as deductions.

These institutions include the Royal Australasian College of Surgeons, the Royal Australasian College of Physicians, and various colleges of nursing. I should very much like to see the list extended, and perhaps next year the Treasurer will find that possible. Organizations of a charitable and worth-while nature come readily to mind. One is the Boy Scouts movement, with which I am associated in Queensland, and another is the Girl Guides movement, a splendid organization, which should be encouraged in every possible way.

I suppose that every honorable member can readily think of other organizations and societies, and I can appreciate the perplexity of the Treasurer in deciding at budget time just which he will approve for the purpose of allowing deductions. I know that his own approach would be to extend the list if he possibly could, and I feel confident that when he believes the time is ripe he will do so. It is very proper that there should also be some recognition of the value of scientific and research work. I welcome the inclusion of the name of the Council for Christian Education in Government Schools in the list of organizations, donations to which are deductible for income tax purposes.

I want now to say something about zone allowances. This ties up with the very important problem of the need to decentralize our population. Every honorable member will agree, for I do not think that this is a party-political issue, that if we are to develop this country we must not only increase our population but also make the most of our resources, many of which are as yet untapped. Great areas of Australia are not adequately populated and developed. Some are not even partially developed. The Government is moving in the right direction in liberalizing zone allowances, the effect of which can be more readily followed by reference to the map which the Treasurer has issued in conjunction with this legislation. Briefly, zone A includes that section of Australia north of the tropic of Capricorn, with the exception of the more settled parts of coastal and central Queensland. It also includes the islands forming that part of Australia lying adjacent to the zone, and also the external territories of the Commonwealth. The previous concessional allowance for zone A was £120 a year. The bill increases the allowance to £180. The zone has been extended to include more of Western Australia, the whole of the Northern Territory and a portion of south-western Queensland which at present is in zone B. Al! of the people in the areas added to zone A will, of course, benefit from the new zone allowance. In zone B, which comprises the remainder of the country affected, the allowance has been increased from £20 to £30.

I have already referred to the effect of clause 5 on servicemen stationed in the Malayan area, and have pointed out the need to look at it in conjunction with clause 13. A serious anomaly has been remedied, and as soon as Royal Assent is given to the bill, certain personnel in Malaya wi!! be placed on the same footing as those in zone A and will receive a concessional allowance of £180 a year.

In granting increased zone allowances, the Government is recognizing the need for the decentralization of our population. Many industries could be, and should be, encouraged to move away from the metropolises. There is far too great a concentration of population and industry around our capital cities, and I am hopeful that zone allowances will assist in a positive way to distribute our population more evenly and help to develop our national resources. The increased zone allowances are, of course, also a recognition of the hardship, suffering and loneliness of the people outback. Those of us who are accustomed to all the amenities of city life, and who have not seen much of life outback, probably do not appreciate all that these people have to put up with in order to sustain life and play their part in the development of this continent. I am very pleased indeed thai the Government has recognized their value.

Clause 14 will do much to help business people by correcting an anomaly in relation to the payment of taxation by persona involved in bankruptcy proceedings. Under the bill, the amount paid by a taxpayer in respect of a debt incurred in one of the seven years preceding the year of income will be an allowable deduction " to the extent that it does not exceed so much of the debt as the Commissioner is satisfied was taken into account in ascertaining the amount of the loss ". Perhaps to one who is not familiar with the wording of the clause that is a little hard to understand, but it corrects an existing anomaly and, even though it is subject to two qualifications, is a step in the right direction. It will certainly be a help to business people who come up against financial difficulty.

In replying to the honorable member for Bonython (Mr. Makin), 1 have referred to clauses IS and 16. Clause 15 deals with the increased amount of life insurance and superannuation allowed for tax deduction purposes. Clause 16 relates to medical and hospital fund contributions. I should like to express my appreciation of the Treasurer's action in providing that payments to those funds shall now be allowed as a separate deduction. That will help a great many people in the community, especially the family man and the small businessman - the great middleincomeearning group who are struggling hard to pay off homes and educate families. The honorable member for Bonython does not think that the concessional allowances for education expenses are worth while, and argues that they will benefit only the wealthy section of the community. From my observations, that is not correct. Education expenses include university and college fees, and, in these days, such institutions are open to any one. A great number of Commonwealth scholarships are awarded annually, and there is no reason why any intelligent boy or girl, who is prepared to work hard, cannot go to the very top in the field of education. That process will be helped considerably by these increased concessional allowances. Payment of fares and provision of text books are an expenditure that weighs heavily on poor families whose children attend State schools, and the Government's, action in increasing the concessional allowance from £75 to £100 in respect of such expenditures will help a great many struggling family men. Three years ago the allowance was increased from £50 to £75. The Treasurer has shown throughout that he is a man who has a very ready and sympathetic understanding of the burdens that have to be borne by family men, and has approached the whole matter in a very broad, humane and practical way. It was the Treasurer who introduced the original £50 allowance in respect of educational expenses, who increased it from £50 to £75 in 1953, and who is now asking the Parliament to increase it again, from £75 fo £100.

It is no doubt a disappointment to many business people of all kinds that the Treasurer does not consider the time ripe for any further implementation of the recommendations of the Hulme Committee in respect of depreciation allowances. However, the question of these allowances is one that has to be considered in relation to the economy as a whole.

Mr SPEAKER - Order! The honorable member's time has expired.

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