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Wednesday, 13 September 1972
Page: 745

The PRESIDENT - Before I call Senator Carrick to ask the next question, I must make it clear to the honourable senator that I have an uneasy feeling that perhaps I was unjust to him yesterday. If in fact this did occur, I wish to express my personal regrets to the honourable senator. I now call Senator Carrick.

Senator CARRICK (NEW SOUTH WALES) - Thank you, Sir. My question is directed to the Minister representing the Treasurer. I ask: Is the Minister aware of a reported statement to the Securities Institute of Australia . by the Labor Party's so-called shadow Treasurer, Mr Crean, to the effect that it would better for people to get 2 per cent or 3 per cent return on funds rather than 5 per cent or 6 per cent? Would not such a policy have a disastrous effect upon all persons who depend upon superannuation, insurance or other modest investments for their source of income? Would it not dry up the flow of investment funds within the country and so stop growth and create widespread unemployment? Is the Minister aware that 'Webster's Dictionary' defines the word 'shadow' variously as: 'Having form without substance', and 'an imaginary or delusive vision'?

Senator COTTON - I am grateful for the definition of 'shadow' from 'Webster's Dictionary' because I have often thought to myself when I have heard references to the observations of a shadow Minister, in a shadow fashion, that on most occasions they were something which had been conjured up in the darkness without any light at all. In regard to interest rates and the speech to the Securities Institute of Australia by Mr Crean, I did not read the full text of what Mr Crean said although I have read some of the comments which have appeared in the Press about this matter. Quite apart from the honourable senator's question, I was interested in the observation that there should be a reduction in interest rates.

This is a country with a notably high savings record. I think that Australia is regarded as the second highest savings country in the world. A tremendous amount of the development of Australia is financed out of savings which are the forgoing of today's benefits for something later in the form of life assurance, savings, or whatever we may call them. What one gets in interest rates is the price for forbearance, for doing without or for saving. To reduce interest rates arbitrarily in that style, to me, would not be wise. Without doubt it would depress the saving rate, it would depress the habit of thrift and it must have an effect on superannuation and a consequential effect on people's earnings. So, it seems to me to be fundamentally a most unwise proposition to come from somebody who purports to be a possible Treasurer.

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