FI1 3T TRANSCRIPT OF SPEECH BY THE PRIME MINISTER,
THE RT. HON. R. G. MENZIES IN BUDGET DEBATE ON
THURSDAY 25TH AUGUST. 1960
I was very interested in what I heard of the speech
of the honorable member for Wills ( Mr. Bryant), and I was glad
that he made a properly impassioned -ppe : l for instruction in
the country. If I may say so, Sir, he needs a little instruction
himself on the financial affairs of Australia. He took the
opportunity to say something that I did not expect ever to hear
from him, and that was the old bromide that if you can do it for
w. r, why cannot you do it for peace? If you can do it for
destruction, why. cannot you do it for instruction?
The honorable gentleman knows perfectly well that you
can do certain things for war, if you raise taxation to wartime
levels, if you control all investment, if you ration food
and supplies generally, and if you go back to all the. controls
that existed in Australia very properly, in the course of the
war. What he must go away and think about is rwhether he is
telling us, in this year of grace, that it is the policy of the
Australian Labour Party to secure enough power to do all those
things once more in time of peace, It is perfectly simple. It
is so simple that even the honorable member for Yarra ( Mr.
Cairns) ought to understand it. If you reproduce the conditions
and the powers, the circumstances and the authorities of war, of
course you can do it. But is the Leader of the Opposition
prepared at the next election or the one after or the one after
that as long as he is sitting there to go to the people and
ask them to authorize the Commonwealth Parliament to impose
income tax running up to 18s 6d. in the to control investment,
to control capital issues, to ration food and other coimmodities,
and to reinstitute all the controls of war? I am sure that he
knows, because he is an intelligent man, that unless he can
reproduce the conditions, he cannot reproduce the results.
Mr. Cairns:-Why do you not put up an intelligent argument?
MR. MENZIES: I uas under the impression that rwhat I had said
was quite intelligent, but I leave it to others to determine
whether it was. My main purpose in this debate, which i shall
not prolong very much
Mr. Hc. rold Holt: It is hardly a debate!
MIt. hiENZIES: I agree with that cojmment. My purpose is to say
something about what I understood to be the case of the Opposition.
I know that for unavoidable reasons, my friend the
Leader of the Opposition cannot be here tonight, but I think I
would be permitted to say that in the course of his speech,
twhich was as remarkable for its omissions for the matters it
dealt with, he seemed to me to put forward four proposals. It
was nothing like a positive speech from a Leader of the
Opposition. The first of his four proposals ras the admirable
suggestion: " Get rid of the Honzies' Government". All I can
say is that, if all the speeches made by Opposition members are
like his, the people will never get rid of the Menzies
Government, except by death. Mind you, that is not only a
probability but a certainty, in due course. In his second
proposal. he said, with a fidelity to his predecessor that I
could no6 but admirc, " We ought to h.. ve the Chifley Government
back again". I said to myself in the best Australian
vernacular, " Too right." The 6pposition is always living in
the past, never living in the present. That is what is-wrong
with the Australian Labour Party. It is practising a dead
philosophy with a dead collection of ideas.
Mr. Ilaylen: Do not repeat yourself,
Mi. MENZIES: That is all right I have to repeat everything
three times to you, for the most elementary reasons.
0 The third proposal I have heard it at least four
times-is that the right way to deal with the Budget in 1960 is
to alter the Constitution to give more powers of control to the
Commonwealth Parliament. Is that the best contribution that
honorable members opposite can make to a Budget debate?
Mr. Costa: It is the only sensible one!
MR. MENZIES: I am familiar with your views on that. I am also
familiar, as no doubt my friend is, with the long history of
proposals to alter the Constitution. But to come along to
people in 1960 and say, ih. n dealing with the Budget, that at
some time in the future a Ka-thleon Mavournoen promise the
Gonstitution ought to be altered
Mr. Haylen: Do not become sectarian!
MR. M , NZIES: If there was a Scottish proverb about MacTavish, I
would use it. In his fourth proposal, the Leader of the
Opposition said that we must defeat inflation. There I thought
he was on good ground, but he refrained from tolling us how he
would do it. To defeat inflation, to restrain it, to bring it
to a halt is the supreme task of this Parliament.
Mr. Pollard: You have been telling us that for ton long yoars.
MR. MENZIES: Now Roggieo
Mr. Pollard: You are now no further ahead than you woro when you
started.
MR. I. ENZIES: I apologize. Through you, Sir, I want to tell my
old and esteemed friend that I have listened to him with great
paticnce and great mystification fot 20 years.
How does the Opposition propose to defeat inflation?
4o are not told. This is the great task of this Budged, as it
is of all budgets, and it is a very difficult task requiring a
great deal of serious thought and a great deal of close study.
How do defeat inflation while maintaining development? These
are the central problems of our oconomy today. It is a very hard
task and a task that can be solved only with constructive ideas.
In order to deal with that real problem, let us forgot the
unrealities of the Opposition casa if I may so dignify it, and
look at comments of the professional expert critics. , Je
have heard some of them and read some of them, end I want to say
something about them. Having been left la-menting for an
Opposition case, I must cast my net wider and find out what the
critics aresaying elsewhere.'
First, they say that there are no signs of cuts in
Government spending. Those are the very words of one powerful
organ. Hure we have a blissful silence on the Opposition side of
the chamber, because I do not think that any Opposition member
would believe that if his views were put into operation, he
would not increase Governfment spending by millions, or scores of
millions, or indeed, in an exuberant moment, by hundreds of
. millions. The critics say that there are no signs of cuts in
Govrnment spending. I want to remind the House of the facts,
bcause -fa. cts have a lovely intractable quality about them.
-Mr. Cairns: Is that why-you avoid-thcm?
MR'. iENZIES:_-That is why I am about-to-refer to them. Tehonorable
member for Yarra has never had evun a nodding
acquaintance with a fact in his life.
Mr. Curtin: I Don't think you like him'
MR. i. ENZIES: I do not. I think he is deplorable, since you
ask me. I do not think you are very good, but I like you; that
is the difference.
Mr. Curtin: That will lose me votes at the next election.
MR. MENZIES: I hope so,
What are the facts? Expenditure of capital works and
services in this Budget is actually down on what it was last
year. It has fallen from œ 142,000,000 to œ 139,900,000. That
is not very much, you may say, but it is a fall. It is worth
remembering that at a time when the Commonwealth Government, in
order to help the States to carry out their vastly imoortant
duties in the public sector of capital investment, is doing more
for the States than has ever been done for them before, we have
in fact reduced expenditure on our own capital works and
services. As against that, our payments to the States have
risen by œ 29,000,000. Does any critic here or elsewhere say we
should not have done that?
Mr. Pollard; Only by
MR. MENZIES: I have heard you and many other people. I remember
everything you say with loving care, and I have heard you say
many times that the States ought to have more. Very well, the
payments to the States this year, under an agreement which they
all accepted with great satisfaction are up by œ 29,000,000. I
have mentioned those two matters.
Budget expenditure has risen by œ 89,700,000. Some one
says, " That is a tremondous increase. That shows you are not
controlling Commonwealth expenditure." I remind the committee
of the fact that this year allocations by the Australian Loan
Council for works and housing, every shilling of which will go
to the States, has risen by œ 10,000,000. Moreover, as a result
of the increases provided for in the Budget, expenditure on
social ervices and rupatriation benofits will rise by
œ 10100,000 I have already mentioned an increase of œ 29m. in
payments to the States. The increased cost of social services
at existing rates, apart from all changes proposed for this year,
will be œ 23,000,000. Does anybody suggest that provision should
not have been made for those payments? The increased cost of
repatriation benefits, apart from the increases provided for in
the Budget and to which I havu referred, will be œ 8,100,000.
Does anybod-suggest that we should repudiate our debt charges?
They have risen by œ 3500,000. In addition, according to our
estimato, which may turn out to be somewhat conservative,
expenditure on redemptions will rise by œ 2,600,000. All that
means that of this nominal increase of œ 89,000,000 to which I
have referred, the sum of œ 86,500,000 is in respect of items
which no one in the Parliament or outside it would challenge.
In other words, there has been an increase of œ 3,200,000, When
we set off against that the reduction in expenditure on capital
works, honorable members will see that the actual increase in
Commonwealth expenditure is quite nominal.
As responsible members in this Parliament we should ask
ourselves, " Has any body. any proposals to reduce any of these
items?" If he has, the Treasurer and, if I may say so, I will
be interested to hear them. But nobody has any proposal to offer.
There has boon no hint of one. Therefore, the first charge
against the Budget falls to the ground.
Next, it is said I know this is not what the
Opposition said that the Govarnment, by an ultra-cautious
approach, is retarding expansion. All I need say in reply to
that charge is that, on the facts, it is just silly. I have not
the time to quote all the figures; they are familiar to
honorable members from their reading of the documentso o have
had record housing, record employment, record production, record
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average earnings, record national development and record contributions
by the Commonwealth in the field of education.
Mr. Pollard: And record inflation.
MR. MENZIES: To say that we are retarding expansion is to nake
a statement which anybody who cares to go anywhere in Australia
and look about then will see is contradicted.
The third charge against the Governmnt is that we
have inflation. That is true. It is referred to by the
Opposition annually during the Budget debate. But I ha. ve never
known the Opposition to make a single proposal calculated to
retard it.
Mr. Cairns: You never deal with our case.
MR. MENZIES: How can I deal with a non-existent case? You
have no case. I am flattering you by even pretending to disnuss
it. I adrit, Mr. Chairman, that we have an inflationary movemont.
But we as the Government have a policy which has been stated and
been acted upon with precision. It is unfortunate that I should
have to repeat it. First, we adopted the principle that there
should be some sensible restraint not injustice in wage
costs. The Opposition has bitterly attacked us for that
approach. But the Commonwealth Conciliation and Arbitration
Commission has agree with us. Secondly, we sai. d we would remove
import licensing in j~ ubstance. We said that because we wanted
the ordinary man and woman in Australia, rich or poor, to be
able to have more goods and to buy more services so that the
inflationary pressures night be reduced. What does the
Opposition say about it? So far as I h. ve understood honorable
members opposite, they have been opposed to getting rid of
import licensing. I thought for a while that the reason why they
wanted import licensing rete. nod was that they regarded it as a
protective measure for industry.
Mr. Peters: Is that why the Govcrnent implemented it?
MR. MENZIES: I seen to recall that the honorable member has
spoken on that subject. There is nothing like dealing with the
facts of life. When import licensing goes, that is a fact of
life. Therefore, I should have expected the Opposition to say,
" Let us do something that will prevent Australian secondary
industry from being injured by the inflow of imports."
Mr. Peters: Huar, hear!
MR. MENZIES: I an very glad that my honorable friend should
say " Hoar, hear". But when ny colleague the Minister for Trade
( Mr. McEwen) introduced a bill to provide for urgent temporary
import duties so that local industries should not be damaged by
a flood of inports, the entire Opposition in this Parliament
perhaps inadvertently I do not know voted against it.
Mr. Reynolds: You get close to the truth sometimes.
MR. MENZIES: The honorable member ought to think about these
matters. The fact is that the Opposition voted against the
giving of power to impose temporary import duties to protect
Australian industries while the Tariff Board conducted its full
and final inquiry. Honorable members opposite may go away and
laugh that off at their leisure. The fact is that they wanted
import licensing, but when they could not got it they could not
have cared less about what happened to Australian manufacturing
industries. They have made that peifectly clear.
Our third item of policy was that we would support
measures designed to avoid excess bank and credit liquidity. I
do not know -hat is the attitude of the Opposition on this
matter. Everyone who have a rudimentary knowledge of how to
deal with inflationary process knows that the restraint of
credit is one of the great things that a central bank ought to
be engaged in. But we do not know what the Opposition thinks
about this matter.
Mr. Haylen: What about hire purchase?
MR. MENZIES: Honorable members opposite mumble about hire
purchase, but none of their colleagues in any State Labour
Governmont seems to do a thing about it. Fourthly and this
is the hub of the matter we said, " We will avoid deficit
finance in 1960-61." Ie sid that, many months back, and this
Budget is our performance of it. Does any responsible person
challenge the idea that we ought not to have a deficitthis year?
Is there a solitary sc-. l I use the words loosely on the
Opposition side who believes that we ought to be budgeting for
a deficit at a time of inflationary pressure? Is there a
single writer of any responsibility anywhere who says that we
should? Or course not, and, Sir, if nobody can challenge that
proposition, let the Opposition face up to it. How does it
propose to balance the Budget? Let us assume that it believes
that the Budget ought to be balanced and that we ought not to be
in deficit: How does it propose to do it? Not one word have
we heard from the Opposition
Mr. Bryant: Whose budget is it?
MR. MENZIES: It is ours.
Mr. Bryant: Well do something about it, then. ' Jo are barren of
ideas.
MR. MENZIES: The honorable member says that the Opposition is
barren of ideas. That is a perfect description of the
difference between these two parties. Does the Opposition say,
" Yes, we are going to balance the Budget by reducing expenditure"?
Certainly not because, on its own showing, it would
increase the Budget out of hand. On this great problem, the
problem that we have tackled in this Budget, the Labour Party
is futile and silent. Having mentioned these four points I just
say this, before I conclude: I am sure members opposite say
some of them have hinted at it that social services are
neglected Mr. Peters: So they are.
MR. MENZIES: Yes, I knew the honorable member would say that.
He is my over present help in time of trouble. I hope he never
leaves his seat. I could not live without him.
Mr. Clyde Cameron: Uhat about Lord Ward?
MiR. MENZIES: No, there is no risk of that, I hope. But, Sir,
think of it; pensions, medical benefits, hospital benefits,
child endowment all those things social services, about
which honorable members opposite talk ccasionally and
occasionally incessantly where we came in, just as they wont
out totalled œ 92n. and in this Budget totalled œ 330n.
Mro No wonder, with you in charge.
MR. MENZIES: I know I am going to have some clever fellow say,
" Yes, the value of money has fallen". Y; s, if we take either
the series index or the new consumer index figure which
has been evolved we find that there has been, over that period
of tine, an increase in the index figure from roughly 60 to
roughly 120. In other words, there is a change to that extent,
but that is only a faction of th-increase in social services
from œ 92n. to œ 330n. But having mentioned those global figures,
I
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lot me say this; honorable mombors opposite have boon fairly
silont on the change that is emerging in the nemoas tost for
property and income. I wonder if they thoroughly' realize that
this change in the moans tost will give some benefit, and in
many cases a large benefit to 120,000 people in this country:
and therefore, Sir, broadly the Budget is aptly fashioned and
stands, if not unassailed, at least unbroken by his arguments.
It is aptly fashioned to slow down and to arrest inflation and
to maintain development; those two things being things that
have to live togetho-r presenting the greatest possible
difficulties of adjustment; and, above all things, to provide
social justice for 10,000,000 people in what I believe is one
of the great countries of the world.