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Thursday, 7 October 1971
Page: 2046

Mr TURNER (Bradfield) - The matter before the Committee is whether it should vote a sum well in excess of $30m to enable the Department of the Treasury to carry on its administration during the current year. Before turning to some matters that I feel deserve mention I am constrained to refer to one or two speeches that have been made by honourable members earlier in the course of this debate. First I would like to refer to some remarks made by the honourable member for North Sydney (Mr Graham) particularly because he referred not only to me but also to my friend, the honourable member for Isaacs (Mr Hamer), in regard to some things that we had said in the course of an earlier debate. The honourable member referred to our suggestion that a House of Representatives estimates committee should be set up to scrutinise the Estimates in a way that they can not be examined in a committee of the whole as this is. The honourable member argued that the Joint Committee of Public Accounts was adequate to deal with any matters that might otherwise come before an estimates committee if the House thought fit to set one up.

In these 2 arguments he said, first of all, that under its charter the Public Accounts Committee can do whatever an estimates committee might do. Secondly, he said that if the House were to set up a further committee in addition to those that we already have it would impose too great a strain on the resources of this place and the resources of the Public Service. So far as the Parliament is concerned I understand that the Public Accounts Committee consists of 10 members, 7 from the House of Representatives and 3 from the Senate.. If another Committee were set up with a similar membership we would be very lacking in capacity if we could not provide the necessary number of members. As far as the Public Service is concerned, this would impose further strain on it, but I would suggest to my honourable friend that the time of public servants could be saved if they were not required to wait for long periods until the committees were ready for them but were given due warning when they were expected to appear. I am not saying that this would not impose additional burdens upon the Public Service but these should not be insupportable.

I would mention that in the United Kingdom - we claim to model ourselves on the Parliament of Westminister which of course we do not - not only is there a Public Accounts Committee but also an Estimates Committee. That Parliament seems to think that the 2 functions arc not one but separate functions. That Parliament has, of course, a number of other committees but it also has many more members. I will not go into this now. What are the functions of these committees? Why are they different? The principal function of the Public Accounts Committee is to ensure that when Parliament votes a specific sum of money for a particular purpose the Public Service does in fact use that money for that purpose and no other. This is the principal function of the Public Accounts Committee. But I suggest that an estimates committee would look at the various amounts of money proposed to be spent on particular objectives and would seek information as to what were the policies behind those proposed expenditures. To my mind this is a separate question altogether and one of tremendous importance to us. Here we are voting more than $34m to the Treasury. For what purpose is the money to be spent? We would like to know. We have listed item after item but we might like to scrutinise the officers and say: 'Why are you spending this amount of money on this item? What is it for? What are the policies that lie behind it'? We would be wiser men if we knew. As it is we have no machinery to enable us to know. I will leave this matter but I repeat that - and in this I have been ably supported by my friend the honourable member for Isaacs - 1 believe there is a need for an estimates committee of this House.

I would like to refer to one other matter raised in the course of debate. This was raised by the honourable member for Adelaide (Mr Hurford) and was supported by the honourable member for Berowra (Mr Hughes). Both honourable members felt that as it is a long time since the report of the Ligertwood Committee was presented the time has come for another comprehensive report on the taxation system because many people have been avoiding taxation and a number of loopholes ought to be closed. Specific reference was made, perhaps by both honourable members but certainly by the honourable member for Berowra, to the possibility of imposing a capital gains tax. Certainly one of the honourable members was dubious as to whether he was for it or against it, but both believed that this matter should be investigated. I do not have as many doubts as they have. A Canadian royal commission looked into this matter.

We have had creeping inflation for years. Now we have galloping inflation. I do not know what happens next. Perhaps we will go over Niagara Falls next. In a period of inflation so many people find it much more profitable to buy something and sell it at a profit later than to invest in the ordinary way and depend upon the dividends they may receive from the investment. I think this is thoroughly bad. It means that speculators and smart-Alicks are profiting and they are profiting at the expense of people who are not as smart as they are. Some may say: Let the smart people profit. I do not say this at all. I say that those who gain from inflation should compensate those who suffer from it. We have a case of Robin Hood in reverse - inflation robs the poor in order to give to the rich. Therefore I think this matter of a capital gains tax needs careful consideration.

I had hoped to speak on other matters but I was diverted by my honourable friends on both sides of this House. I had hoped to say something about a matter affecting the Treasury in particular - a matter of great importance and principle. I refer to the question of Federal and State relations. There are many clever people in the Treasury. We are voting money for their salaries. For years the economy of this country has been bedevilled by failure to arrive at any principles that would regulate Federal and State financial relations. We have had Premiers conferences beginning with recriminations and ending in buck passing. We have a formula which is no sooner agreed upon than it has to be cast aside, whether because of inflation or because of pressures from particular Premiers. And always you have the additives. When there is a formula additional sums have to be added for political reasons or for some other reason which may be good or bad. The real issue is: What are the subject matters, having regard to their inherent characteristics, that can best be handled nationally and those that can be handled locally? This is the real issue.

It is in the interests of the people and not of particular politicians or bureaucracies to require joint action. Having determined these matters how do we arrive at allocation of resources with due regard to local and national responsibilities? There have been great changes in the interpretation of the Constitution since, shall I say, 1901. It is not that the Constitution has changed so much but it is the interpretation of the High Court of Australia that has changed. Indeed we never know until we go to the High Court what the Constitution means. In the old days, of course, the Roman baruspex would have looked into the entrails of birds to discover the answer. Now we go to the High Court to discover the answer which is as much veiled from the common eyes as the message of the entrails of birds was in earlier times. We find we have one economy which needs unitary management. We find that now we have tax powers that we did not know we had. Since the concrete pipes case we may well have power in regard to trade practices, company law, overseas companies and the securities industry that we never knew we had before.

I have not sufficient time in this debate to deal with this matter. However, I had intended to suggest that we must first determine what we should do now that we have these known powers. Secondly, we have to determine how we are to allocate resources between the Commonwealth and State governments. Unfortunately my friends have drawn me aside from my main purpose. I have tried to debate this matter instead of making a read speech and I have fallen into the trap of not saying what I had proposed to say. Perhaps I shall have an opportunity on another occasion.

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