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Thursday, 9 March 1961

Mr L R JOHNSON (Hughes) .- The honorable member for Barker (Mr. Forbes) concluded his address by referring to " this responsible Government ". Undoubtedly, it is responsible for the sorry state of affairs the country is facing at present. There can be no doubt that it is fair to say that the Government has lost the confidence of the Australian people. I believe it has also lost the confidence of the majority of the members of this House. It has been very interesting to sit in this chamber to-day and listen to supporters of the Government speaking, especially the members of the Australian Country Party who, in their own way, have indicated their disapproval of the Government and the sort of things that they would like to see done to prevent a continuation of the policies that have characterized this Government's activities.

For some considerable time, the Government has abdicated from the sphere of financial responsibility. It has preferred to deal with effects rather than causes. I believe that every honorable member is aghast at the way things have developed. There is an atmosphere of submission to the highest bidder in the country to-day. The people see the great benefits and persona! aggrandizement that comes from being an entrepreneur and a manipulator of money rather than some one who has some genuine record of worth in the country for the national benefit. That is the sort of thing that characterizes the present state of affairs. We have seen huge segments of our economy come under outside control, and the Government has lost interest in them.

There is a great resentment against the Government because of its failure to maintain economic stability. In recent weeks, this Government has set about creating unemployment artificially. The great ramifications of government which we have devised have become the monsters which, instead of serving our purposes, are now setting about consuming us. This country with great natural resourses so vast that unemployment seems impossible to contemplate is now becoming the subject of unemployment artificially created by this Government. It is incredible that business people in the community are unable to contemplate any economic stability which will enable them to expand their businesses.

There is great resentment .at the unemployment that has developed. Who knows what figure the army of unemployed has reached? Every honorable member can tell the House of factories closing down and the termination of building construction. The statistics are always dragging well behind, but no one will deny that the total of unemployed in Australia is well over 100,000 persons at present. Many unemployed workers will never register because the Commonwealth Employment Offices cannot satisfactorily cater for their particular type of employment.

There is great resentment against the Government because of the need for housing. We have lost our scale of values. Where is the attitude of first things first? This Government does not care that so many young Australians, and new Australians for that matter, have been denied the republicanism of an Australian fireside - the thing that has made this country so worthwhile in the past. To-day, thousands of young Australian families are separated and divided, living in shacks, garages and shanties.

Where can a young married couple borrow money at a reasonable rate of interest to buy a home? Is there any honorable member on the Government side who can say where young married couples can get finance to-day? We have deteriorated to a stage where the people's money is denied to the people themselves. If you are a great entrepreneur, a speculator involved in the manipulation of money, or are engaged in speculative building you can get money, but the ordinary tax-payer is unable to get finance for a house in this year of grace, 1961. Only on Monday morning before I came to Canberra, I interviewed a yow g man whose family of six children is divided in three different houses. That is the state of the nation to-day.

Of course, there is great resentment at the Government's failure to maintain a decent rate of national development and expansion. What is the Ministry of National Development doing? It is concerned with the atomic reactor and it is involved in the administration of the War Service Homes Division, but I have never heard the Minister for National Development (Senator Spooner) expound a well-devised national development programme which will ensure and guarantee the future of Australia.

Then, of course, there is great resentment at the way the balance of payments has deteriorated. To listen to the right honorable member for Cowper (Sir Earle Page) and others speaking to-day one would think that the balance of payments is not a matter of great moment. Of course it is. It has caused such great concern to the Government in recent months that the Government has brought down ill-considered economic measures. The Government has panicked and has caused a great loss of confidence to permeate throughout the Australian community. To-day's newspapers contain a report that an investment organization, the Hilton group, is about to withdraw from this sphere of activities. There has been a great loss of confidence and it is becoming apparent that the culmination of twelve years of Liberal Party-Country Party coalition governments is going to have disastrous consequences for the people. The chickens are coming home to roost at last.

Since the new session of the Parliament commenced this week. I have been interested to hear the new resolutions of the Government and the way in which it proposes to embark on new projects to patch up things that are basically wrong. Its approach is belated. The Government has reached a crisis and it is trying to invoke new ideas. Tt is introducing proposals which cannot possibly have any substantial impact on the situation. We have heard proposals about the development of roads in the Northern Territory. That sort of thing has been advocated by all sections of the community for a long time and by members of the Opposition. We have had to wait twelve years for supporters of the Government to advocate the development of the Northern Territory. Of course, there has been recent reference to the need to promote overseas sales. So quickly is the Government turning out new schemes and ideas and throwing away the old ones that the plan which the Acting Prime Minister introduced last night was not even properly developed. He was faltering and looking for the finished proposition from the members of his staff. The ink was not dry on the paper. The plan was not even printed. He was pulling a rabbit out of a hat, but he did not know whether it was black or white. He had not quite finished the controversy that he was having with the Treasurer and other members of the Government. Heaven knows what this scheme of providing export incentives to Australian firms is going to do! There is no question that companies set up by investment from overseas will benefit tremendously. I am not terribly enthusiastic about giving General Motors-Holden's Limited, for example, greater tax remissions than it has already. I am not interested in encouraging people to send so much meat overseas that there will be a great deficiency of meat in Australia and the Australian housewife will be faced, as she was a short time ago, with buying meat at a price well beyond her financial capacity. We get all these half-baked schemes.

There is a proposal to develop new port facilities. Opposition members have been contending for a long time that something should be done about this and the answer from the Government has always been that it is a State responsibility. Now it is shifting its ground. In 1961, faced with disaster, the Government is promising to put all these things into operation. Even encouragement for the tourist industry is proposed. For years people had been talking about the great tourist potential of Australia. The only ones who have denied it have been members of the Commonwealth Government. Now, they are at last going to look at this proposition.

The Government's proposals are not bad in themselves, but they are half-baked. They are not properly developed and it is obvious that they are not part of an integrated scheme designed to overcome the financial difficulties with which the country is at present confronted. Nor are they designed to ensure that Australia's great man-power and economic resources are directed in such a way as to bring the greatest possible benefit to the Australian people. The people who are benefiting as a consequence of the exploitation of Australian raw materials are in other parts of the world.

The Government's proposals are a hotchpotch. Australia needs an overall plan of the type we are told has been adopted in the planned economies of other countries. Unless we face up to this on an organized basis, we will go down the drain very quickly. Only last November the Government was suddenly confronted with the monstrosity of its own misdemeanours. Apparently, it had not realized what was happening with respect to overseas balances. It had not recognized that our overseas balances were being dissipated. Suddenly, in November, the Government started to face up to the position. A great crisis hit the country and measures were immediately introduced of a type which caused great havoc in the community. Why was it not possible for the Government to watch the trend and to provide some check over a period?

The discovery that Australia was spending a lot more than it earned and would become insolvent unless the trend was checked almost threw the Government into a panic. I am quite sure that it has regretted many of the things that it foolishly did in November. It has already corrected some, such as the higher rate of sales tax on motor vehicles. Only in February last year the Government decided that the answer to the problem of the inflationary trenah - the matter which the honorable member for Barker (Mr. Forbes) has been talking about - was to lift import restrictions. In this matter, the Government rejected the advice of its Treasury officials - its advisers, its experts. Certainly, it rejected the advice of the Opposition. Business organizations of all kinds, including banks, told the Government that to abandon import restrictions was a ridiculous thing to do in the circumstances, but it went ahead. The Treasurer considered that this was the means by which the Government would be able to come to grips with inflation. He thought that this was the answer - to bring in goods from low-cost countries such as Japan. He took the view that if they came into competition with Australian goods it would force down Australian prices. It would weed out inefficient industries and deal a great blow at inflation. Clearly, that has not been the case. The Government should now be able to observe that what it hoped to do by lifting import restrictions has not been achieved and that the objective could better have been attained if import restrictions had been retained. There is no doubt that the Government did have some need to look at the inflationary trend which the honorable member for Barker has been talking about. There has been a great rate of inflation in this country - almost an unprecedented rate. I was interested, a short time ago, to look at the monthly bulletin of statistics provided by the statistical office of the United Nations. It is very interesting to see how Australia compares with other countries with respect to inflation. The United Nations statistical office has taken a base unit of 100 for the year 1953. Since 1953 we find that the index of wholesale prices has risen to 105 in Canada and to 106 in the Federal Republic of West Germany. In Japan the figure has stayed at 100. The figure for New Zealand is 110, for the Union of South Africa 107, for the United Kingdom 103 and for the United States of America 109. To demonstrate that Australia does not shatter records only in the Olympic Games, the figure for Australia went to 116. The consumer index figures are similar to those for the wholesale price index. Again taking a base figure of 100 in the year 1953, the consumer index figure for the United States rose to 111, for Canada to 111, for Germany 114, for Japan 115 and for Australia to 121. Figures supplied by our Commonwealth Statistician indicate that there has been an increase in the price of all groups of commodities in the six capital cities of almost 25 per cent, since 1953. You cannot blame the Labour Government for that. I am talking about the period from 1953 to 1961 when the Australian consumer price index figure rose from a base of 100 to 122.5. That is a level of inflation that no other country has experienced. It has been tolerated, if not brought about, by a Government which was elected away back in 1949 on a platform of holding the trend of inflation. Of all the methods by which the Government could have sought to curb rising prices, the most dangerous, the most speculative, the most inefficient and the most ineffective was the lifting of import controls. Yet, despite all the warnings, the Government lifted the floodgate of imports control. Nothing was substituted in its place, not even a gradual dampening down of available credit for imports.

Import restrictions were lifted in February of last year and bank credit rose by £190,000,000. How can you justify this situation in which a complete vacuum was left and no exchange credit system was introduced? The whole situation was left to chance. So the great flood of imports has raced on unabated. It has left in its wake, unfortunately, a large number of victims - the early victims of what might well become a great national disaster. Some Australian manufacturers, unable to compete with low-cost countries, have already gone out of business.

We are faced with a very real problem. The value of exports is falling rapidly and the value of imports has been increasing rapidly. Let us look at the international reserve picture of a short time ago. By the end of December, 1960, our reserves had fallen to £376,000,000 from £547,000,000 twelve months earlier. That is something to be concerned about. Our reserves had fallen by £92,000,000 in the three months to the end of September, 1960. They fell by £44,000,000 in the three months to the end of December, 1960. They have fallen at a rate which has never been known in the history of Australia. When we look at our exports position we see what a great fall there has been. In the first half of 1960-61, our exports were worth £54,000,000 less than they were in the first half of the preceding year. Obviously, something has gone bad in the State of Denmark.

What is the imports situation? In the same period, imports rose rifle exports were falling at a dramatic rate. The value of imports was £108,000,000 higher in the first half of 1960-61 than it was in the first half of the preceding year. On top of that, and to make the position worse, there are all the invisible payments, such as the £7,000,000 for freight, insurance and things of that nature. These are circumstances with which the Government has never been prepared to grapple. It has always allowed Australia to be held to ransom by the conference shipping lines which have exploited us and made great profits from us. The Government has never interested itself in resurrecting the Commonwealth-owned line of ships and ensuring that it did a decent job for Australia.

Let us have a look at the imports situation. Of 26 major categories of imports, nearly all increased in value in 'the first half of 1960-61 compared with the corresponding period of the previous year. There were only a few exceptions. They included tea, which remained at the level of £7,000,000; tobacco, which went down by £2,000,000 to £6,000,000; and raw cotton, which remained at £3,000,000. Otherwise, the value of most of our imports moved in the way I have mentioned. Imports in the 23 other categories, the major categories, increased substantially. Those categories included iron and steel. Fancy Australia importing iron and steel! Our imports rose by 300 per cent., or by £24,000,000. It is difficult to understand that development.

Let us have a look at some of the figures of the Broken Hill Proprietary Company Limited. I have here a newspaper clipping which is headed - " B.H.P.'s best year: Profit jumps 36i per cent." It goes on to state -

Consolidated net profit rose a mighty 36.5 p.c. from £9.9 million to a record £13.5 million.

Why is it, in those circumstances, and since steel production is such a lucrative business, that we have found it necessary to import steel and to increase our exports to such an incredible extent? Clearly, if B.H.P. is not prepared to move into this field to a greater extent than at present, it is time that we established in this country a people's steel industry to ensure that we can balance our budget.

It is interesting to have a look at the timber industry. Fancy Australia importing timber and increasing its timber imports by £7,000,000 in the half-year that

I have mentioned! We have heard Tasmanian representatives in this Parliament, such as the honorable members for Wilmot (Mr. Duthie) and Bass (Mr. Barmrd), referring to this situation. They have told us that timber mills all over the country, and especially in Tasmania, are closing. Where is the organization in that respect? This Government obviously stands indicted and condemned for having allowed the position to get completely out of hand. On the one hand, timber mills in Australia are closing, and concurrently and, simultaneously we are bringing in an additional £7,000,000 worth of timber in a half-yearly period.

If we look at other industries we see the same kind of anomalies occurring. Imports of yarns, textiles and wearing apparel have increased substantially. My colleague, the honorable member for St. George (Mr. Clay), has often told the Government of the way to avoid this great increase of imports. The increase of vehicle imports is unnecessary, and given the time I could demonstrate how this Government, if it had the ability, could avoid such increases. There have been great increases in the imports of rubber. The Government has done nothing to develop the production of by-products of coal and nothing about the production of synthetic rubber. Our rubber imports are growing at a great rate. So, too, are our imports of paper and board, which have increased by about 40 per cent, in each case in the period to which I have referred. The value of imports for the first half of 1960-61 was £561,000,000. The value in the first half of the preceding year was £429,000,000, so that there has been an additional £132,000,000 worth of imports.

I do not know why the Government should continue to call itself a government. It has stood idly by and allowed that situation to develop. After it has developed, after the gates have been left open and the stock have got out, the Government begins to pitter-patter about with a few remedies of an infinitesimal value which are not applied in a proper, efficient or organized way in any event. It is quite clear that the Government has lost the confidence of the Australian people. In the first half of 1960-61 we have seen a decline of some of Australia's most im portant export industries compared with the corresponding period of the previous year. Exports of wool and sheepskins have fallen by £38,000,000, while exports of grains other than wheat have fallen by £5,000,000. Exports of meat have fallen by £19,000,000. No wonder the Australian Country Party is anxious to see something done about water conservation and the construction of roads in the north! Why have our exports of meat fallen by £19,000,000? How can the Government justify that situation while a third of the peoples of the world are starving? Exports of cheese, eggs, milk and cream also have fallen substantially. So, too, have exports of many other commodities, including fruit, the value of which has fallen by £2,000,000. The value of steel exports has fallen by £5,000,000.

That is the state of the nation, Mr. Speaker. Unfortunately, time will not allow me to indicate in more precise terms the manner in which the Government has betrayed the best interests of the people of Australia. There is no doubt that it has let us down very badly. We long to see an alternate attitude. We want to see installed in office a government which will be more than just a status quo government. We do not want a government which is just prepared to let things take their course. We want to see a planned economy. We need a Minister for National Development who will go into action and do more than look after the War Service Homes Division, which he does in a very unsatisfactory manner, anyway. We want to see great developmental projects in this country. The great deposits of raw materials lying in the ground must be exploited to full capacity. They must not be regarded as something to be exploited only by investors from overseas. They are the heritage and the birthright of the Australian people.

It is the responsibility of the Government to develop and exploit our resources and also to establish bodies such as the Snowy Mountains Hydro-Electric Authority. We want the Government to say, "Here is a great deposit of bauxite, of uranium, or of zirconium. We are going to organize its development in conjunction with the States and local government. We will set up a commission like the Snowy Mountains Authority. We will underwrite the scheme from Consolidated Revenue. We will say to 30,000 or 40,000 young Australians, Come to this great town we are building, where we have nice homes, good streets and decent schools for you'. We will underwrite this project, having regard to the undisclosed profits to be made from it." That is the kind of programme to which we must resort if we are to ensure that Australia is not to rely on raw materials and primary industries to the same degree in the future as it has in the past.

Mr. SPEAKER (Hon. John McLeay).Order!The honorable member's time has expired.

Debate (on motion by Mr. Pearce) adjourned.

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