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Thursday, 1 September 1960

Mr WHITTORN (Balaclava) .- Mr. Temporary Chairman,I should like, first, to pay tribute to my predecessor as member for Balaclava in this place - Mr. P. E. Joske, Q.C., who is now Mr. Justice Joske of the Commonwealth Industrial Court. He occupied for nine years the seat from which I am speaking this evening, and he was recognized on both sides of the chamber as a man of integrity with whom it was easy to co-operate, and as a thinker. I believe that the Parliament sustained a great loss when he left it to undertake other duties. He is loved for the work that he did not only in his electorate but also in the Parliament itself.

I should like to place on record, too, my appreciation of and thanks for the way in which honorable members on both sides have welcomed me to this Parliament. Not only my colleagues on this side of the chamber but also many Opposition members have seen fit to ensure that everything possible was done to enable me to become familiar with the procedure and the landmarks, as it were, of the Parliament.

I should also like briefly to congratulate the honorable member for Bendigo (Mr. Beaton) on winning the by-election for the Bendigo seat recently. Since that byelection was held on the same day as was that at which I was elected to the Parliament, obviously he and I will have quite a lot in common. However, our respective political philosophies are an exception to the things that we have in common. I congratulate the honorable member upon his maiden speech, which was made earlier this evening. No doubt he sweated it out as I have been doing over the last half-day.

I now turn to the Budget, Mr. Temporary Chairman. Over the past two weeks, many statements have been made about the Budget for 1960-61 not only in the Parliament but also by the Australian newspapers, which have thoughtfully considered the plans behind the Budget and the implications it has for the well-being of the country over the next twelve months. Never before in my memory has there been such unanimity of opinion or conjecture among thinking people about a Budget. However, such people consider that this is an ideal Budget which will surely have the intended effect of steadying the inflationary pressures which are evident in our economy.

Each of us surely concedes that over the past decade, and even prior to it, Australia has experienced the greatest commercial, economic and industrial expansion that it has ever known. To-day, we are among the first ten trading nations, and at the same time we are a great manufacturing country. It is my belief that not only the traders but also the workers have gained tremendous benefits from this expansion. Never let it be said that the workers have gained nothing from this expansion. Figures have been cited in this place which prove to me, though I am not an economist, that the workers have gained immeasurable advantages from the administration of this Liberal Party-Australian Country Party Government over the past decade. These benefits can continue provided the Government and the Parliament play their part and continue to guide the destiny of the nation as they have guided it over the past eleven years.

This Budget shows that the Government has planned its programme for the next twelve months in such a way as to ease inflationary pressures. However, these pressures have existed to some degree throughout the fifteen years since the end of World War II. They were probably brought about initially by shortages in the immediate post-war period and by the tremendous demand for our primary products not only iri Australia but also in other countries which recognize their own need for the goods that we can produce. In addition, the decision to encourage immigration to Australia gave the country a tremendous fillip. Our absorption of immigrants has been one of the highlights of the western world. It is my belief - perhaps it is an erroneous belief - that every time a migrant arrives in Melbourne, Sydney or Perth this country has to expend at least £5,000 of its wealth in order to get that migrant started within our community. That £5,000- if that is the correct figure - has to come from the people who are already here. However, the migrants have proved of tremendous advantage, not only to the wellbeing of Australia but also to our future prosperity.

The injection of these factors into our way of life produced the effect which has been seen over the years, but fortunately we still have time to steady the inflationary trends. I believe that the immigration programme particularly has had a major influence on our overall growth which, together with the additional needs brought about by a higher standard of living, has caused an unprecedented industrial and economic growth which is without parallel in the twentieth century.

During the last ten years we have seen highs and lows in our economy, but the pattern generally has been a steady rise in prosperity which has been shared by the workers to an ever-increasing extent. If Australia is to maintain, and increase, its present high level of prosperity, the greatest possible measure of co-operation must exist between governments, management and trade unions, which must be wholehearted, continuous and national. Never let it be said that the workers do not want to cooperate. As most honorable members know, I have worked in factories for many years. I have spoken to thousands of workers in those factories and they believe, as I do, that the more they put into the work they do in the factories the more benefits they will derive for themselves, their families, their children and the future of this country. Ninety-five per cent, of the workers in factories believe that, and they have no desire for extra pounds in their pay envelopes provided the standard of living they now enjoy continues for the next five, ten, fifteen, twenty or 50 years. It is only by such wholehearted co-operation that we can expect that highly remunerative and constant employment for the workers which will enable management to plan its development and budget for its own future.

The various and regular pressures for increases in wages, a reduction in working hours, longer holiday periods and additional superannuation - in fact, any pressure which causes increased costs, causes management to be timid in forecasting for the future. If this Parliament cannot forecast for the next twelve months, how can the managers of firms be expected to forecast for the future? In many cases it is impossible for management to budget for greater development within its own enterprise because of these pressures, such as the pressure for higher wages, which regularly come before the community. This timidity can apply to all sections of industry.

It is very significant that after the Treasurer's Budget speech General MotorsHolden's Limited stated that it is planning a tremendous expansion of production which will mean that more local work will be available for Australians. It means work not only in the factories the company proposes to build, and on the equipment that will be installed in those factories, but also in the factories in which that equipment is made. I believe that the employees of General Motors-Holden's " dips their lids " to the management of that company for the proposed expenditure of £15,000,000 on expansion in the next three years.

As has been mentioned by members on both sides of the chamber, this is a technical age and we must behave as technical people. The far-reaching developments which are taking place in every department of the modern industrial world call for expert consideration by those in high places. To my mind, never was there a greater need for united, spirited and expert attention to bs given to each new development as it emerges. The changes are so far-reaching and frequent that this expert attention is a prerequisite to the solution of the problems they create. lt is fairly evident that the leaders of many of Australia's great trade unions are becoming more aware of the possibilities of this new technological age. This also applies to the leaders of industry. I believe that in future the younger leaders of each group will co-operate to a much greater extent than hitherto, in order to ensure continuity in Australia's progress. This need for co-operation in every sense becomes more significant when the leaders of industry and honorable members on. both sides of this chamber have shown that they realized the need for what has been termed an export explosion. Honorable members know that the inaugural meeting of the National Export Convention was held in Canberra during May of this year, and over the next few years it will be my personal purpose to stimulate a consciousness of the urgent necessity for a rapid expansion of exports. A careful study of the figures that have been mentioned in this chamber will surely cause far more sober thinking than hitherto. The leaders of industry and of the trade unions must agree that only their mutual co-operation will achieve the desired results. A much higher volume of exports not only will tend to increase efficiency in our productive enterprises, but also will ensure that our capital investment is used to better advantage, enable the Australian worker to have regular and more continuous employment, and also enable Australia to finance its additional import requirements.

A further factor is the growing industrial strength of the countries behind the iron curtain. We all know that they have grown industrially over the past ten to twenty years, and the time is ripe for them to export their products to all the underdeveloped countries. The signs that they will do that are surely evident. The strength of those countries, particularly in manufactured goods, is such that they are looking for foreign markets of high volume. At the same time, it is generally conceded that, behind the iron curtain, decisions will be made to obtain these markets at any cost. So the inference must be that their ventures will be political rather than economic. Therefore, the need for us to plan for and achieve this export drive, and to make the markets opened regular and continuous outlets for Australian goods, is so much the greater.

Much has been done in this respect and the Minister for Trade (Mr. McEwen) is to be congratulated on his untiring efforts and the results achieved over the last twelve months - in fact, over the past five years - in increasing Australia's exports. Much has been said about the Japanese Trade Agreement, but an impartial observer would surely give credit to the Minister for his skilful handling of this agreement and the attendant results. All honorable members know that secondary products are coming into Australia from Japan, and we have heard the clamour from various quarters for this flow of goods to be stopped. However, the results have shown that Japan now purchases 17 per cent, of our primary products, and is purchasing an everincreasing amount. It is paradoxically true that the more we widen the range of our manufactured products, and so theoretically narrow the scope for imports of finished goods, the greater becomes the need for imports. It is also true that Australia is a high cost country, and it is generally conceded that in respect of goods which have a high labour content, particularly manufactured goods, we cannot compete with some other countries. Other great manufacturing countries are facing similar problems, particularly the United States of America, where, I believe, inflationary trends are still evident. These trends overseas should provide an opportunity for Australia to increase its exports, provided stability is achieved in its own economy.

In the United States of America, under the Eisenhower regime, there has been a retardation of economic expansion. The presidential elections in that country later this year could have a real effect not only on Australia but also on all other countries. Whichever presidential candidate is successful, he will want to prove his worth over the next four years, and he will try to do so, not in Europe, but in the under-developed countries. Whichever candidate is elected will ease some of the internal economic restraint that has been imposed within the United States under President Eisenhower. Mr. Kennedy would do more in the way of lifting these economic restraints than Mr. Nixon would, but, whoever is elected, inflationary trends must still be at work which will considerably affect the Western world, providing Australia with an opportunity, if it can steady the inflationary trendshere, to increase its exports. It is very necessary, therefore, for Australia to resist cost pressures of all kinds. If it can do so, it will be able to export greater quantities of manufactured goods, and its primary products will find it easier to retain their markets overseas.

Wc must expect to pay for our imports, to an increasing extent, with the proceeds from our manufactured, goods, as the United States has had to do, rather than with additional proceeds that may be obtained from our more uncertain pastoral and farm products. I use the word " uncertain " in the literal sense, because it is widely realized that prices of pastoral products rise or fall according to the economic situation throughout the world.

I believe that we should have a good look at certain cost components, particularly in relation to secondary products specifically manufactured for export. Many speakers in this debate have discussed the pay-roll tax. I agree that this tax should continue to be imposed during the coming year, but in the case of secondary products manufactured for export I feel that we should consider reducing the rate of this tax or entirely exempting the industries concerned from its operation. This would not affect the 1960-61 Budget to any great extent. The importance of the pay-roll tax in future Budgets' should not be overlooked. It could be a means of maintaining the incentive for manufacturers to try to reduce their costs.

Another important cost component is represented by power charges. This is particularly true in the case of secondary industries, in which power costs are steadily rising. In practically all secondary industries there is a constant demand for more and more power. Power supply authorities might be persuaded to reduce charges for power, in, the form of either electricity or gas, used specifically for the manufacture of exportable products.

Many other factors are involved in the question of reduction of costs, and the Minister for Trade has said that management was entitled to expect much more co-operation from governments in its efforts to reduce costs. It is my fervent hope that representatives of manufacturing interests and of the trade unions will spread the gospel of our urgent need to reduce costs, and1 will bring forward suggestions for ways in which to increase our exports of manufactured goods. There are three sections of the community closely connected with manufacturing industries. The first is the Government, the second is management and the third is the workers. I believe the Government is very receptive of suggestions by management, by trade unions or by individual workers, and that it will carefully consider any such suggestions designed to ensure continuity of our present rate of progress. The Minister for Trade is playing an important part by arranging overseas trade missions, but much more must be done during the next five years. The National Export Convention has stated that within that period we must increase the value of our exported goods by £250,000,000. Honorable members on both sides of the Parliament realize how difficult a task it will be.

I come now to refer to certain individual items in the' Budget. Company tax has been increased by 6d. in the £1, and the Treasurer (Mr. Harold Holt) has re-imposed the 5 per cent, remission of individual income tax which was allowed last year. Certain concessions have been provided with relation to pensions and other social services. The main objective, of course, is to produce a cash surplus of £15,000,000. In other word's, the Budget represents a planned attempt to steady inflation. The Budget provisions do not represent really severe corrective measures, but they will have a steadying effect on the present inflationary trends.

To my mind, the most important measures that have been instituted to correct the situation are credit control and import control. These controls can be exercised by relatively simple processes, and their effect will be of a general character. In other word's, the Budget provisions will not operate harshly on any section of the community, but the Government will have full charge of the situation by means of its control of credit and by means of the provision for the Tariff Board to impose- emergency tariffs if these are recommended by a deputy chairman of the board within 30 days of application for such tariffs. A manufacturer may feel reasonably secure in the knowledge that if his industry is exposed to unfair competition from imported good's, he may apply for emergency tariffs, and a deputy chairman of the Tariff Board may recommend such tariffs within 30 days. This provision may also operate to prevent any tendency on the part of importers to order heavily certain products which might be considered likely to be subject to emergency tariffs.

Our future lies in our ability to reduce costs. This does not mean that the worker will have to work harder or that he will have to accept lower wages. It means that the Government, the leaders of industry, primary and secondary, the workers and the trade unions must find means of reducing costs of production on all sides. This is the only way in which we can ensure continued prosperity. The Prime Minister (Mr. Menzies) has been telling us this for some time.

It is also very necessary for us to export greater quantities of manufactured goods. I believe that in the next twelve months we will see these problems being tackled courageously. We have heard in this Parliament talk of calamity, but I see no signs of calamity in this country. Opposition members have spoken of gloom, but I can see very little signs of gloom in the country, either among the workers or among the leaders of industry. When I go to Melbourne I see large factories and other buildings being erected. When I go to Sydney I see the same sign of prosperity. In every city, capital or provincial, one sees expansion proceeding on all sides. I have only one comment to make concerning the speeches made in this debate by Opposition members. I refer them to the remarks recently made by the Premier of New South Wales, and reported in the newspapers this week. From these remarks it would appear that Mr. Heffron and the members of his government are living in a different country from the members on the Opposition side of this Parliament.

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