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Wednesday, 7 April 1971

Senator KENNELLY (Victoria) - I join honourable senators in congratulating Senator Kane for what we of the hard school refer to as breaking the ice. He will now find that things become easier. I support him in the matter that he has raised as a matter of urgency. The honourable senator referred to the grave deterioration as a result of inflation in the economic position of senior citizens. Surely one could nol fail to agree with those words. While the Minister for Health (Senator Greenwood) was speaking I went outside the chamber and obtained interesting figures which show that there has been a grave deterioration. In 1949 the age pension was 24 per cent of the average weekly earnings. In October 1970 the age pension was 16.9 per cent of average weekly earnings. I would say that a drop in pensions from 24 per cent to 16.9 per cent of average weekly earnings could rightly be described as a grave deterioration of the pos:tion of pensioners.

Although J agree wholeheartedly with the proposal Senator Kane has put before the Senate for consideration, I cannot agree altogether with some of the remarks he made. With modern finance and business practices today I admit that there are a number of small investors in a lot of industries, but when all is said and done, if one examines the position it is found that the people who gain the most are those who put in the major portion of the finances. Whether this position is right or wrong is a matter for debate. But the facts arc that, although the capital is spread to a very small degree, those who receive the greatest dividends are far removed from the small investors. I have often considered this position in relation to inflation.

The Minister endeavoured to paint a very glowing picture of the situation from 1950 to 1970. I am sorry to inform him that his concept of the situation does not agree with mine. I went to the Library and found thai in comparison with the 1950-51 figure the consumer price index rose by 112 per cent in the December quarter of 1970. The Minister has said that this is a very great triumph for the Government. What he calls a triumph and what 1 call a triumph are different matters.

I now refer to the subject of senior citizens. As stated in the House of Representatives Hansard of 31st March, the general Government expenditure on health and welfare expressed as a proportion of gross national product for the year 1968 - I take it they are the latest figures - is as follows: Europe-Denmark 20.48; Germany 17.95, Sweden 17.45, France 16.8. A number of other countries are listed but I do not want to take a quarter of an hour in reading them out. If one looks at the figure for the nation of which I and the Minister arc citizens, one finds that health and welfare expenditure represents the princely figure of 7.09 per cent of the gross national product. To my mind that bears out very greatly what Senator Kane has proposed in the terms of his motion.

My friend from Victoria, Senator Greenwood, has said that insurance premiums paid by a citizen are tax deductible. That is true. He mentioned that a person can receive a tax deduction for insurance premiums paid of as much as 51,200 a year. Lel me put the matter on the line. How many people classed as average wage earners could. expect to pay out SI, 200 a year in insurance premiums? A person earning an average wage, which I suppose is from $76 to $80 a week, or approximately §4,000 a year, would be a pretty good economist if he could spare 51,200 a year for the purpose of reducing his tax. So we ask ourselves: What are we to do? 1 do not exclude the possibility that a lot of the responsibility for the present inflationary situation rests on the shoulders of the people themselves. Having taken an interest in politics in this country for about 55 years, I am of the opinion that the greatest disaster which befell the Australian people was as a result pf the prices referendum in 1948. 1 do not say that we would hot have a mild inflationary situation even if the proposal had been carried at that time, but at least we would have been able to damp it down. But today the sky is the limit. If ever there is talk of increasing the salaries of senators, one is rather amused to see the headlines which appear in the Press, but the fact is that we suffer in the same way as does the ordinary citizen. When 1 look back over the years - the Minister can look back also - and think of the price of land, say. 20 years ago and compare it with the price of land today, 1 asked myself: What hope do the young people have? Honourable senators opposite cannot say that governments could not have prevented this position. Of course they could. The price of land was pegged in 1949. Governments of the same political colour as that which the Minister supports have lifted controls on land prices, and of course the price of land has just gone haywire.

I looked also at the question of loans today. I remember reading an interesting speech made some time ago by the then member for Balaclava, Mr Joske. If I remember correctly, he is now a judge of the Commonwealth Industrial Court. In his speech he took by way of example two persons who had £5.000 to invest in those days. One person put the money into a loan at 3i per cent interest. Mr Joske compared this with . the case of a person who put £5,000 into real estate. The result would astound honourable senators. I do not know whether government loans are being filled today but I have often wondered why it is that you cannot have a variation in interest rates. If a government wants to raise loan moneys for the progress of the nation at least the interest rales should be flexible.

I believe a lot more could be done by the Government. Firstly, a lot more could be done in relation to superannuation payments to Commonwealth employees or even in relation to superannuation of senators, because in a few weeks time I may be receiving a superannuation payment. 1 make no bones about the fact that I am concerned to see that superannuation payments made to people who have served in this chamber are brought up to date. But 1 am vitally interested in the superannuation payments made to Commonwealth employees. If my memory serves me correctly, some adjustments have been made to these payments but the adjustments have not kept pace with the decrease in the value of money. Unless the Government corrects the position, the standard of living of those who move on to superannuation payments must of necessity fall. 1 doubt whether the Minister meant this as he said it, but as I understood him, he said that this debate was delaying the passing of social services legislation. I think that at times wrong words are easily said. What the Minister said does not appear to convey what he may have meant to convey. I think he has used the wrong words. I think the Senate would be extremely wise if it carried more of these fine resolutions. Each of us could learn what the other's point of view is, irrespective of his political party. 1 have never thought that the Labor Party was other than the best. One would expect me to say that readily.

Senator Greenwood - You must have had some doubts on some occasions.

Senator KENNELLY - Perhaps we have made a few mistakes.I will not say how many. I will leave that subject. If this motion is carried, it will do good. It will say to the Government that the majority of the Senate wants the Government to do something more than just utter words. The Minister said that positive action will be taken. That will be most interesting. I hope we will be able to learn what the positive action is so we can say that Senator Kane has not stopped the passage of important legislation by introducing this matter, because some good will have come from it. When Senator Webster was speaking, Senator Byrne interjected and said that in the economy, as it is today, there has to be at least a small measure of inflation. Possibly that is so, but how long can this country suffer inflation when it continues to increase at an average of 3 per cent to 4 per cent a year?

Senator Webster - What is the situation overseas?

Senator KENNELLY - I am not worried about what is happening overseas. God forbid! I am worried only about what is happening here. We are not paid to govern overseas.

Senator Webster - Some people have to have widervision than that.

Senator KENNELLY - If you. want that wider vision and if you want to rectify the wrongs of the world, I leave them to you. I am more concerned with the wrongs here. I know that my time is almost up. I support very heartily the motion.

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