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Wednesday, 15 March 1961

Mr STEWART (Lang) .- There is no doubt that the majority of the people of Australia support the want of confidence motion which has been moved by the Leader of the Opposition (Mr. Calwell). During the ten and a half years of this Government's reign, all sections of the community have voiced their criticism of its economic policy, but the criticism has never been so widespread or as prolonged as that which has been levelled at the Government since its most recent economic proposals were announced last November. There is good reason for most of the criticism, and the Labour Opposition would have been remiss in its duty if it had not proposed the motion which the House is now discussing.

The honorable member for Corangamite (Mr. Mackinnon) gave reasons for certain actions of the Government, but during the whole of his speech he gave the impression of a man who was speaking simply because he thought that he should speak and not because he had a firm belief in the statements that he uttered. It was very interesting, for instance, to hear him proclaim the fact that perhaps one of the reasons why imports have continued at such a high level is that importers, because of the fear that import restrictions will toe reimposed, have decided to 'buy far more good's overseas than they actually require in order, as he states, to have a high quota on which to base their claims for import licences should restrictions be reimposed in the future. That is exactly what the Labour Party has been stating. We have said that the people for whom this Government stands - the industrialists, the manufacturers and the vested interests in the community - 'have not been prepared to do for the country what most people believe to be the correct thing.

If, as the honorable member for Corangamite has suggested, these importers and retail houses have decided to spend millions of pounds overseas on imports because they want to be in a good position if restrictions are re-introduced, then their action is unpatriotic and unprincipled. Unless that section of the community is prepared to put its needs and its requirements on a comparable level with every other section of the community, and place the future of this nation1, its development, and the welfare of its people above all else, the re-introduction of controls will be imperative.

We of the Labour Party are not the only ones who believe that selective import controls should be imposed. For instance, Mr. Staniforth Ricketson, chairman of directors of Haliburton Investments (Australia) Limited, after referring to what he believed to be the unjustified proposal for the devaluation of the Australian £1, said this during his address to the tenth annual meeting of the company -

A more probable course would appear to be some re-imposition of import controls if the influx of goods continues for some months at recent levels. This would help in replenishing Australia's international reserves and would enable some relaxation of credit restrictions.

Mr Griffiths - Who said that?

Mr STEWART - That statement was made by Mr. Staniforth Ricketson who, I think the House will agree, can hardly be regarded as a supporter of the Labour Party. The Labour Party's view is also shared by the Associated Chambers of Manufactures of Australia. Time and again during the last few weeks Mr. R. W. C. Anderson, the federal director, has had something to say about this matter. In the " Canberra Letter " - the organization's publication - dated 2nd March, 1961, Mr. Anderson devoted a good deal of space to stressing the fact that selective import restrictions should be imposed. He then said - *

We could save £100,000,000 a year by reducing imports of consumer goods which are now running at a rate well in excess of £200,000,000 a year. Nobody (repeat nobody) would be adversely affected by this kind of import control.

There is no doubt that most of the goods that are being imported can be, and have been, manufactured in Australia. One reason why imports have continued at such a high level since restrictions were lifted in February last year is that the importers and retail houses have exercised no discretion. And some of the things which are being brought into this country are manufactured here and have been manufactured here for many years, but the height of ridiculousness is reached when we realize that frozen iceblocks, meat pies, orange juice, tinned ham and tinned chicken, as well as many other things mentioned during this debate by various speakers on the other side of the House, are being imported. I suggest that Cabinet should look at some of the goods which are being purchased by government departments from overseas and which can be readily manufactured in Australia. I suggest that we are importing for government use, such things as guns, shells, ammunition, cordage, webbing and safety equipment such as parachutes, underwater equipment and dinghys. All those things have been and still are being manufactured in Australia.

If we are going to lift our overseas reserves, one way in which to do so is by seeing that the Government makes some attempt to ensure that its departments do not purchase from overseas goods that can be manufactured in Australia and which have been and are being manufactured here. Some of the things which I have just mentioned are of vital defence importance, and, while I do not want to hark back to 1942 and 1943, it is clear in our memories of that time that our defence industries were very much below the standard at which they should have been. Yet the Government which was responsible for that position is making the same mistake as it made then by allowing important manufacturing industries, which can be useful in time of war or stress, to be put out of business by the importation of goods.

Surely, if we are to maintain secondary industry in Australia, we should see that these industries, which can be of benefit to us in time of conflict, are among those that are supported. The stop-and-go policy of this Government over the last ten years has been the main reason for the drastic economic safeguards and changes which were introduced by the Government last November. It is not necessary for me to go back any further than the announcements made in November last to point to the fact that this Government lacks courage and is a government of indecision, which has no idea at all of the needs for the development of Australia.

Industry has not been given an opportunity to develop on a sound basis since this Government came into office, because it has repeatedly changed its economic plans. We have only to look at the plans announced last November. One of four points was the introduction of the 10 per cent, increase of sales tax on motor vehicles. Another was the plan to compel insurance companies and superannuation funds to invest 30 per cent, of their funds in Commonwealth loans. The third point was the credit squeeze, which is still with us, while the fourth point was the deductibility of interest payments for income tax purposes. If we look at each one of those points we find that, after a very short period of time, because of pressure applied to the Government by the motor industry, the sales tax on motor vehicles was reduced from 40 per cent, to 30 per cent. I do not maintain that the sales tax should have 'been increased in the first place, but the Government, after due consideration - as it said - bad decided that that was one of the things essential to be done. But with a little bit of pressure from the motor industry, and with perhaps some actions being taken by the motor industry, which were not absolutely essential at that time, the Government went into a panic and the Prime Minister (Mr. Menzies), prior to his departure for overseas, announced that sales tax would be returned to 30 per cent.

The next point was that 30 per cent, of insurance company and superannuation funds had to be invested in Commonwealth loans. We find that the Government is still shilly-shallying on this question. Pressure has been applied to the Government by the superannuation funds, insurance companies and Various other private instrumentalities, and the Government cannot make up its mind whether to compel them to put into Commonwealth loans 30 per cent, of their funds in accordance with its announcement in November last.

The fourth point is that of deductibility of interest payments for income tax purposes. The Government is still discussing the question and its proposals are still under consideration. The Government does not know what it is going to do about that point at all. Three out of the four points announced by the Government in November have been altered or are to be altered and, consequently, it is quite apparent that this Government is prepared to give way to pressure which comes from those people whom it represents in this Parliament. If the pressure comes from any of the workers for increased wages, better amenities or increased social services, we find that the Government can always muster sufficient strength to stand up to that pressure. Yet in the case of the people who support the Government it is prepared, even to the detriment of the employment situation in Australia and the future of this country, to give way to those who pressurize it.

The main reasons for the introduction of the Government's economic proposals in November was that our overseas reserves were falling to a dangerous level. I know that statement is contrary to the opinion which has just been expressed by the honorable member for Corangamite (Mr. Mackinnon), who says it was our internal inflation which caused the Government to take those measures. But in truth and fact the reason why the Government took those actions was that our overseas reserves Were falling. The Government took action by a backdoor method and was not prepared to say: " You people who have been bringing in too many luxury and unnecessary goods will be stopped from doing that. We will put on selective import controls." Instead of doing that, the Government decided to put on the credit squeeze which has not been effective to any great extent at all, as our overseas reserves fell last month by between £13,000,000 and £15,000,000 and, in the previous month, by about the same amount.

The credit squeeze has made no difference at all to the volume of imports, but it has made a great deal of difference to the people in Australia who have faced unemployment and dismissals in various industries throughout the length and breadth of the country. While the Government, perhaps, looks forward to the day when it will have a pool of unemployed, we, on the Labour Party side, say that one thing which we do not want to see is any person in Australia, willing and capable of working, without a job. Irrespective of the fact that we would have to impose import restrictions ot preserve our position I believe that the interests of our Australian people are sacrosanct and should be preserved at every opportunity.

I suggest that the imposition of selective import controls would cause no excessive hardship to anybody. During the eight or nine years when they were imposed there were very few average people - and they are the people whom the Australian Labour Party represents, in the main - forced to go without any goods that they desired. If they could not get the imported article they were certainly able, in most instances, to get one made in Australia; and most of them are quite prepared and much prefer to buy Australian manufactured goods. I believe that one of the reasons for the influx of excessive imports is the fact that they are brought in, in many instances, from cheap labour markets. They come into

Australia at certain prices and the importer and retailer then make an excessive markup for profit. Those goods are then sold at a price not far below the price of Australian manufactured goods. But the price at which they are sold is little below the price of the Australian manufactured goods because of the excessive mark-up for profit by the importer and the retailer. I would like to see a survey undertaken by the Department of Trade to ascertain how many imported goods are being sold in Australia at an excessive amount of profit. 1 am confident that the results of such a survey would amaze most of the people of Australia, and certainly most honorable members on the Government side of the House. Many of the retail stores have failed to play their part in overcoming the economic difficulties besetting Australia at the moment, and it is time this Government realized that until it has the courage to show some decisiveness they will continue to use every device at their disposal to prevent it from doing what it realizes must be done and what we of the Labour Party know is urgently needed if the position is to be rectified.

Yesterday, the honorable member for Parkes (Mr. Haylen) asked the Treasurer a question about a loan of £1,000,000 made by the Commonwealth Superannuation Board to David Jones Limited. When answering that question, the Treasurer gave a far from satisfactory explanation, and I should like to deal with that subject again because I feel there are many points about that transaction that should be brought to the light of day. As I have stated already, the Government has found it necessary to impose credit restrictions because of the excessive purchases of imports and excessive spending in the community. Excessive purchases of imports have adversely affected the liquidity of such firms as David Jones Limited. The Government now proposes to bring down legislation designed to compel insurance companies and the trustees of superannuation funds to invest in Commonwealth loans. Credit restrictions have caused widespread unemployment throughout Australia. Yet, in the face of all these facts, we find a statutory body of the Commonwealth making £1,000,000 available to a retail house whose liquidity undoubtedly has been adversely affected because it has purchased excessive amounts of consumer goods from overseas! Amongst other things, the Government's economic policy has resulted in reducing to a minimum loans to State governments and local governing bodies for essential public works, and at this time when local governing bodies are unable to construct roads, carry out sewerage work or lay down kerbing and guttering, we see a Commonwealth statutory body lending £1,000,000 to a firm such as David Jones Limited!

I remind honorable members that just prior to the imposition of stricter import controls a few years ago, it was rumoured that the very firm which is now receiving a loan of £1,000,000 from the Commonwealth Superannuation Board was given prior warning of the Government's intention to impose those stricter import controls and so was able to enjoy an advantage over its competitors in the import field. The same set of circumstances would seem to be present in this instance, for David Jones Limited has been granted a loan of £1,000,000 from Commonwealth superannuation funds at a time prior to the introduction of legislation requiring insurance companies and the holders of certain other funds to invest a percentage of their moneys in Commonwealth loans.

Mr Haworth - The Government has no control over that, and you know it. The Government cannot tell the trustees of that fund what they shall do with the money in the fund.

Mr STEWART - That is what the Treasurer said yesterday - the Government has no control over what shall be done with superannuation moneys. The point I emphasize is that the Commonwealth Superannuation Board is a statutory body appointed by this Government and, in view of the restrictions being imposed in Australia at the present time, it is completely and utterly stupid and laughable to allow any Commonwealth funds to go into private industry. The Government seeks to wash its hands of the matter by saying it has no control over superannuation funds. The Government should have told the board not to make the loan.

Mr Haworth - Would you suggest that the Government should raid the superannuation fund and use the money for its own purposes?

Mr STEWART - I am not making any such suggestion; the Government already proposes doing that for it announced as far back as last November that it proposed compelling insurance companies and the trustees of superannuation funds to invest 30 per cent, of their moneys in Commonwealth loans. 1 repeat that the Commonwealth Superannuation Board is a statutory body and, if the Government expects private industry to do certain things an example should be set by these statutory bodies. If any of these statutory bodies have surplus Hinds, those moneys should be used for the development of Australia and to ensure i: economic future of the nation instead of being made available to a private retail house which, I suggest, will use those moneys to build a large store either in Adelaide or in some other city of the Commonwealth.

Many speakers on the Government side have suggested that during this debate the Labour Party has offered no constructive suggestion for remedying the position in which our economy has been placed. For the benefit of such honorable members, I direct attention to the policy speech of the Labour Party as delivered by the former leader of the party, Dr. Evatt, on Wednesday, 9th November, 1955. Now that the Government has decided upon an all-out drive to increase exports, it is appropriate for me to read the following extract from that policy speech: -

Negative action on the balance of payments position can help to prevent actual insolvency in the short run. But positive action to encourage exports is essential to regain the position Australia occupied in overseas markets during the Labour Government. That will be the keynote of Labour's overseas policy. Exports must be increased; existing markets expanded; new export markets sought out.

Until very recently, and then only under constant pressure, practically no campaign to sell was conducted in relation to our exports. Labour will create a special Ministry of Exports to devote itself to this vital task. We will tolerate no inhibition which might prevent Australia from associating itself with Britain, Canada and New Zealand in seeking trade relations with all countries, not only in wool but in all exports, both primary and secondary.

I emphasize that the Labour Party made that statement in 1955. That action was urgently needed then, but it is more urgently needed now, and at long last the

Government has decided to do something about our export position.

In the few moments left to me, I should like to refer to the fact that the nonproduction of oil in Australia is costing us in the vicinity of £125,000,000 a year. Some attempts are being made to discover oil here now, but, in all, only four drills are sinking bores at the present time. If the Government were really sincere in its desire to find oil in Australia - and most of the experts believe that it is here to be found - the Government would make an all-out drive to discover oil, for the discovery of oil would have a terrific beneficial effect upon our overseas trade balances. As I have said, it is costing us in the vicinity of £125,000,000 a year to import the oil we need. Recently, the Government announced that it proposed to spend a little over £1,000,000 this year on subsidies for oil search, but I point out that Pakistan, a country whose standards could not possibly be compared with ours, will be spending £13,500,000 for this purpose. We should be making an all-out drive now to discover oil here, and I would suggest that if and when oil is found, the Government should have the controlling interest in it.

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