House of Representatives
30 August 1905

2nd Parliament · 2nd Session



Mr. Speaker took the Chair at 2.30 p.m., and read prayers.

PETITIONS.

Sir LANGDON BONYTHON presented five petitions from certain residents of South Australia, praying that stringent legislation be enacted to prohibit the importation and sale of opium for smoking purposes within the Commonwealth.

Mr. HUTCHISON presented seven similar petitions from residents of South Australia.

Mr. GLYNN presented four similar petitions from residents of South Australia.

Petitions received.

Mr. CHANTER. - Referring to the point of order taken by the honorable member for Kennedy yesterday, in regard to a petition presented by the honorable and learned member for Wannon, I should like to know, Mr. Speaker, if you have yet arrived at a decision in the matter-?

Mr. SPEAKER. - I said that I would look through the petition, and if I found that it was one which should not have been received, would report the fact to the

House. I have looked through it, but as I did not come to the conclusion that it should npt have been received, I have no report to make.

CONDUCT OF BUSINESS.

Mr. WILKS.- I wish to ask the Prime Minister a question in regard to the following paragraph, which has appeared in the Melbourne Age: -

The Federal. Labour Party is prepared to support the Prime Minister in anv measures he may see fit to take to secure speedier progress with legislation in the House of Representatives. If the Opposition resents the application of the new 11.30 p.m. closing timerule, members of the party are willing to assist the Government by providing relays to form a quorum during any all night sittings which may become necessary. Labour members f reely say that Mr. Deakin must be prepared to fight the organized obstruction of the Opposition without mercy for the rest of the session if he is to see legislation now in suspense passed into law. The policy of “ graceful concession “ must be frankly abandoned when dealing with the Cooks, Wilks, or Sydney Smiths.

Is there any foundation for the statement that the Prime Minister has made, or is making, such an arrangement with that section of his supporters, known as the Labour Party, who are acting as galley slaves to this Government, and who are so desirous of repressing the right of criticism and the free discussion of political measures ?

Mr. DEAKIN.- On behalf of the House, I take exception to the phrase which the honorable member has applied to a section of it, which is indefensible in regard to any party. The paragraph referred to was published without my knowledge, and the statement it contains is news. The honorable member for Corangamite has publicly alluded to possibilities of the same kind, but’ I do not attribute it to him. So far from desiring to take advantage of any arrangement to suppress criticism, I agreed with the honorable member for Dalley last evening that at10.45 p.m. I would accede to the request of a member of the Opposition, whom he named, that progress should be reported. I was, therefore, surprised when the honorable member for Darwin rose to speak, but when he informed methat he could not conclude his speech before 11. 30 p.m., felt that I could not refuse to him a courtesy which had already been promised to a memberof the Opposition.

Mr. WILSON. - The suggestion that I have given to the Age the information on which the paragraph referred to is based is without foundation. That journal is not in the habit of coming to me for information, nor would it be likely to publish any information that I might give to it. The remarks which I made recently outside were made on my own responsibility, and without consultation with any member on this side of the Chamber. I was not present on Friday last, when the Prime Minister made an announcement as to the future conduct of business, but I read in the press that he had said thathe intended to force members to sit late, and I replied that, if that was to be done, I would be prepared to meet force with force.

Mr. KING O’MALLEY.- If an understanding has been arrived at between the Prime Minister and the honorable member for Dalley, that a member of the Opposition should open the discussion on the Budget this afternoon, I am ready to give way.

Mr. DEAKIN. - The understanding was only in regard to the hour of adjournment last night.

page 1653

QUESTION

IMMIGRATION RESTRICTION ACT

Mr ROBINSON:
WANNON, VICTORIA

– Referring to the answer given by the Prime Minister yesterday that “ exemption certificates are not generally used in connexion with British subjects,” I would like him to state what steps must be taken, either in Australia or in Great Britain, by an employer who wishes to bring here labour under contract, or bv an employe who wishes to come here under contract? Where must such steps be taken?

Mr DEAKIN:
Minister for External Affairs · BALLAARAT, VICTORIA · Protectionist

– It was intimated, when the first case in connexion with the Act arose, that the proper course to follow in such instances would be to send the terms of the proposed contract to the Government, while the proper Department to address, either within Australia or from beyond the Commonwealth, would be the Department of External Affairs.

Mr WILSON:
CORANGAMITE, VICTORIA

– I learn from a paragraph in one of this morning’s newspapers that it is the intention of the authorities of the Church’ of England in South Australia to import a Bishop from England. I should like to know, for the information of the public, what proceedings must be taken by them to provide for his introduction?

Mr CONROY:
WERRIWA, NEW SOUTH WALES

– In view of the importance of this subject, I ask the Prime Minister if he is prepared to amend the Act, so as to make it clear that passports are not required by British subjects coming here, and that its provisions apply only to men coming out under contract to fill the places’ of others on strike.

Mr DEAKIN:

– Whenever the amendment of this or any other Act is intended, it will be a matter of Ministerial policy which will be duly communicated to the’ House.

page 1653

QUESTION

RUSSO-JAPANESE WAR

Mr CROUCH:
CORIO, VICTORIA

– Seeing the importance to us as a Pacific Power of the war in the East, I ask the Prime Minister if he is able to announce to the House the receipt of any’ official communication in regard to the declaration of peace between Japan and Russia, which is alleged to have been concluded?

Mr DEAKIN:
Protectionist

– There is no official information. If there were, it would have been my duty to convey it to the House. I am informed, however, that the assertion is made by the cable correspondents who serve almost the whole of the Australian press that peace has been officially declared. If that intelligence be true, and there is good reason to believe that it is, no more welcome news has reached this Commonwealth for many months past. The cessation of this sanguinary and costly war will be hailed with the greatest satisfaction by peoples all round the world, and nowhere will the restoration of friendly relations in the East, and the developments which we trust will follow the declaration of peace, be more hopefully hailed than in the Commonwealth.

page 1653

QUESTION

QUARANTINE AND LIGHT-HOUSES

Mr HUTCHISON:
HINDMARSH, SOUTH AUSTRALIA

– Have the Government considered the advisability of taking under the Constitution powers in regard to the control of quarantine, light-houses, &c. ? If so, do they propose to do this at an early date?

Mr DEAKIN:
Protectionist

– The matter is under consideration, and, if time will permit, will probably be submitted this session.

page 1653

QUESTION

EXPORT OF AUSTRALIAN HARVESTERS

Mr ROBINSON:

asked the Minister of Trade and Customs, upon notice -

Whether he will inform the House how many “Stripper Harvesters” of Australian origin have been exported from 1st July, 1904, to 1st August, 1905, and to what places?

Sir WILLIAM LYNE:
Minister for Trade and Customs · HUME, NEW SOUTH WALES · Protectionist

– In reply to the honorable and learned member I have to state: -

Number exported (1905), 252. Destination - Argentine, Algeria, Cape Colony, Italy, Tunis.

Prior to 1st January, 1905, no separate record was kept of the imports and exports of stripper harvesters as distinct from agricultural implements, therefore no particulars can be given for the year 1904.

page 1654

QUESTION

NEW SHORT SERVICE RIFLES

Mr CROUCH:

asked the Minister representing the Minister of Defence, upon notice -

  1. In the new short service rifles issued to the Light Horse, is it true that these have no “ cut off “ to the magazines ?
  2. Is it safe to issue rifles under such conditions ?
  3. Were these rifles sent in this condition by the British War Office ; and is it further true that no bayonets have been supplied with these rifles?
  4. What action does the Minister of Defence propose to take under the circumstances?
Mr EWING:
Vice-President of the Executive Council · RICHMOND, NEW SOUTH WALES · Protectionist

– I have been supplied with the following answers: -

  1. Yes. The Department in this are following the lead of the War Office. In the Imperial service the “ cut off “ is only provided for the short rifle for use by the Naval Force.
  2. The “cut off” is provided so as to temporarily convert the magazine rifle into a “ single loader,” and not for purposes of safety. 3. (a) Yes; the rifles were sent out from the War Office without “ cut offs.”

    1. No bayonets were ordered as it is proposed to make use of our large stock of triangular bayonets by having them locally converted into a “rapier” bayonet. Designs are now under consideration.
  3. It is proposed, for the present, to follow the Imperial practice.

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QUESTION

HORSHAM-WARRACKNABEAL TELEPHONE

Mr ROBINSON:

asked the PostmasterGeneral, upon notice -

  1. Whether he is aware that telephonic communication between Horsham and Warracknabeal was authorized some considerable time ago?

    1. When is such communication likely to be established ?
Mr AUSTIN CHAPMAN:

– The answers to the honorable member’s questions are as follow : -

  1. Yes.
  2. Communication by the condensor system was established on the 8th of July last, and reported to be satisfactory. Since then some difficulty has arisen, and it has been reported that conversations are not now practicable. The matter is receiving attention.

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QUESTION

DEPORTATION OF KANAKAS

Mr R EDWARDS:
OXLEY, QUEENSLAND · PROT; FT from 1913; ANTI-SOC from 1906; LP from 1910

asked the Prime Minister, upon notice -

  1. Whether his attention has been directed to a judgment recently delivered in Canada by Mr. Justice Anglin to the e’ffect that no British Colony could exercise extra-territorial rights with regard to the expatriation of aliens without direct authority from the Imperial Parliament?
  2. Will the Prime Minister take steps to’ ascertain if this is a correct inference to be drawn from Mr. Justice Anglin’s judgment?
  3. In case that it is so, would the Commonwealth legislation respecting the deportation of kanakas be indirectly influenced ?
Mr DEAKIN:
Protectionist

– The answers to the honorable member’s questions are as follow : -

  1. There are newspaper references to a judgment by Mr. Justice Anglin, who is a Judge of a Provincial Court, but no report of the judgment has yet been received, and I therefore cannot say what its effect is.

    1. The authorized report will probably be received in due course.
    2. In any case, the differences betwen the Constitution of the Dominion and that of the Commonwealth are so great that it does not follow that the Canadian decision would apply here-

page 1654

BUDGET

In Committee of Supply (Consideration resumed from 29th August, vide page 1625), on motion by Sir John Forrest -

That the item, “ President, ,£1,100,” be agreed to.

Mr KING O’MALLEY:
Darwin

– I am sorry that there should have been any misunderstanding with regard to my action in requesting an adjournment of the debate last night. I can assure honorable members that I did not speak to any one on the subject, except the honorable member for Dalley, to whom I intimated that I should like to speak to-day, if an opportunity presented itself. I did not consult the Prime Minister, or ask him to afford me any advantage over other honorable members. I take my chance just the same as any one else, and I hope I shall never ask for any privilege that I am not prepared to extend to others. I desire to congratulate the Treasurer on the manner in which he presented his first Budget. We have been accustomed to have the Budget presented by the right honorable member for Balaclava, who is regarded as a Treasurer quite out of the ordinary. Therefore, it is a great mistake to compare the Budget of any other Treasurer with those to which we have become accustomed. The right honorable member for Balaclava has been in the habit of presenting to us our financial affairs in wonderful detail, as well as in the aggregate, whilst the Treasurer has upon this occasion given us great aggregation. I like a man who sees hope in everything, and I detest those who look to the past, and worry themselves about what happened a thousand years ago. I am glad that the Treasurer has given a word of cheer to the whole financial world as to the position and prospects of Australia. The right honorable gentleman laid great stress upon the necessity for bringing more population into Australia. I would ask, however, whether it is desirable that we should have in this great country hopeless, starving, miserable millions, such as are to-day almost a curse to Europe and America. This is one of the great questions of the age. Before we bring’ more people from the older countries of the world to Australia, we should amend our land legislation. When there are fifteen or twenty people waiting to utilize one property, the’ property-holders exercise too much power. If, upon a small island, with a population of 10,000 or 15,000, the whole of the land were owned by two or three men, the land-holders would own the people just as completely as the slaveowners owned the niggers on the plantations before the great civil war of the United States. Coghlan, at page 1,017, says: -

It will be seen that the unemployed comprise a considerable section of the community. No information is available regarding the number in Queensland, but in the other five States of the Commonwealth there were 50,644 persons - 42,88a males, and 7,762 females, who had been unemployed for a week or more at the date of the Census. These figures represent 3”6 per cent, of the total number of workers, and are but little in excess of those for the same Colonies in 1891, when the total was 50,319, consisting of 43,497 males, and 6,822 females, the proportion of the total number of workers being 4*3 per cent. Although the number of the unemployed in X091, as stated above, was 50,644, it must not be considered that all these persons were without employment, as a fairly large proportion of them consisted of workers temporarily incapacitated through sickness or accident.

Should not our politicians see that the 50,000 people out of employment are provided for before we bring any more people here. That is my objection to further immigration at present. If we introduced large numbers ©f people here to crowd our cities, we should bring about conditions similar to those which now prevail in New York, London, Glasgow, Chicago, Liverpool, and other large cities. In a speech which he delivered at San Francisco on 3rd April, Rider Haggard said : -

We face yellow peril now. The crowding of slums of large cities breeds race suicide, and then Mongol hordes will sweep over us. The East has not the evils of the Occident.

I would urge that before we become charitable to people abroad, we should look to the interests of our people at home. I could take the Treasurer into many parts of the city of Melbourne, and show him hundreds of men and women who are virtually on the brink of starvation, who do not know where to obtain their next meal or their bed for the coming night. The Premier of Victoria, who, in my opinion, is the best Premier Victoria has ever had, and who is showing that he is endowed with brains and with profundity as well as rotundity, is doing everything possible to relieve the unfortunate unemployed. If it is desired to increase the population of Australia the Government should take possession of the large landed estates. I do not mean that the land should be confiscated, but that such legislation should be passed as would convince large land-holders that the property they hold was intended for the sustenance of human beings rather than of sheep. We should endeavour to induce the various States to pass such laws as would compel land-holders to utilize their properties to the fullest possible extent, or part with their holdings. I do not believe in confiscation, but, at the same time, I do not approve of land-holders exercising power to which they are not entitled. A great deal has been said on the question of raising revenue. It appears to me that under the party system of responsible government, too much power is wielded by Ministers, as compared with other members of the Legislature. In all questions relating to the finances brought before the House we have the benefit of the product of the brains of seven men, instead of the product of the brains of the whole of the members of Parliament. Surely seven men cannot, unless they include in their ranks a modern Napoleon or an Alexander Hamilton, possess more brains than the other members of this Parliament. The curse of responsible government is that Ministers bring down such a policy as their environment suggests, and, apparently, no one else is in our case in a position to propope any other means of raising revenue than, the Customs and Excise duties. The Treasurer says that the people of Queensland have in their pockets the money which has been lost by the Queensland Treasurer owing to the operation of the Federal Tariff. I can assure the right honorable gentleman that the people of Tasmania wish that they had in their pockets the money lost to the revenue. Suppose that Queensland or Tasmania had a number of factories employing 40,000 or 50,000 persons, the money paid to the operatives would be placed in circulation and contribute to the prosperity of the community, whereas the money saved under the conditions referred to by the Treasurer lies useless in the pockets of a few. Now, referring to Defence matters, it appears to me that we are spending altogether too much money. Our expenditure amounts to 6s. or 7s. per head of the population of the Commonwealth, and I would ask what we are frightened of? We are lighting phantoms. If, as some people fear, Japan has designs upon Australia, should not we, a mere handful of 3,000,000, be absolutely helpless against them? Yet

Ave are spending hundreds of thousands of pounds annually upon forts, military accoutrements, and useless trappings, to guard ourselves against invasion by a power which is now friendly to the nation to which we belong. In fact, only lately, Great Britain withdrew her fleet from the Eastern seas. Since France became the friend of England, the latter Power has withdrawn her fleet from the Eastern seas, being content to absolutely trust her ally Japan. Yet, day after day we hear, not alone military men in their gilt braid and spurs and their peacock feathers, but also members of Parliament and business men. talking about Japan conquering this country. In so speaking, they are actually inciting Japan to attempt the conquest of Australia, japan is the all v of this country, the ally of England, of France, and of Amenca, ‘and these nations are all trading with each other. They are selling their good.1* to each other. They are doing business of all descriptions with each other, and are not talking about attacking each other’s country.

Mr Mcwilliams:

– We shut out the Japanese.

Mr KING O’MALLEY:

– Nations can do as they choose in their own country. No white man can own a piece of land in Japan. I know of various companies which sought to establish themselves in that country, but they could only erect buildings and own property through the medium of Japanese. A nation within its own terri tory is a sovereign entity, and that entity can pass laws to suit itself. Japan has enacted legislation to suit her own people, and under those laws no white man can own property there.

Mr Wilson:

– He can go there as a visitor.

Mr KING O’MALLEY:

– The Japanese can come here as visitors. My objection is that we are spending enormous sums of money upon military defence - upon guns which will be obsolete within ten years.

Mr Kelly:

– The honorable member gets his boots cleaned every morning, and yet they are dirty before nightfall.

Mr KING O’MALLEY:

– The honorable member can get his boots cleaned three or four times a day, but a worker like myself cannot do so. I maintain that if we set out looking for trouble we shall find it. If the biggest prize-fighter in Melbourne were to walk down Bourke-street to-morrow with a chip on his shoulder, he would find somebody ready to knock it’ off. I am surprised that in Australia, which possesses greater resources than does any other country in the world, persons should be continually talking about its conquest by some foreign nation. I object to such statements, and I protest against the proposed expenditure upon defence.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Does the honorable member say that there is no need for us to make provision to defend ourselves ?

Mr KING O’MALLEY:

– There is not the slightest reason for so doing.

Mr Mcwilliams:

– I suppose that we are to: sponge upon England for all time?

Mr KING O’MALLEY:

– For thirty years in America I heard: the statement made that England intended to invade that- country. Every morning some newspaper would announce that the British fleet had been seen off Newfoundland, and that British troops might be landed upon American soil at any time. Naturally, the people were worked up to such a pitch that nearly every Yankee used to sleep upon his Winchester rifle. I object to the waste of money that is proposed upon the Defence Department. It is utter waste. Instead of spending that money in accoutrements and in nonsense that is really injurious to the Commonwealth, it should be spent upon the encouragement of closer settlement.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I thought that the honorable member believed in insurance.

Mr KING O’MALLEY:

– I believe in peace, in commerce, and in justice.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– And in insurance. Mr. KING O’MALLEY.- That is included in the matters I have mentioned. If the sum which it is proposed to expend upon defence were handed over to the States Treasurers for the purpose of enabling them to place people upon the land, the railways of the Commonwealth would pay. I say that we should pension off our military men. Let them come and dance with the young ladies of the town, and enjoy themselves. But we should waste no more of the taxpayers’ money upon these military phantoms, which are conjured up for the specific purpose of creating a scare which does not exist. Great Britain has confidently withdrawn her fleet from the Eastern seas - according to American newspapers - and is willing to trust Japan and France, her allies. America has not yet withdrawn her fleet from Manila, but now that peace has been concluded between Russia and Japan she will doubtless do so. I claim that it is not necessary to waste money upon the maintenance of an army in Australia.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Are the Americans going to blow up their ships?

Mr KING O’MALLEY:

– They are not going to blow anybody up, because there is no necessity for them to do so. I contend that we are mad upon the question of war in Australia. Ever since I landed here, some sixteen years ago, I have heard of nothing else. Some years ago I was in Tasmania when it was generally declared that a Russian fleet intended to effect a landing there. Now, the Russian fleet is at the bottom of the sea, and I would suggest to the Treasurer that we should limit the expenditure upon defence for a period of twenty years, and gradually retire our military officers.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Is the honorable member voicing the views of the caucus ?

Mr KING O’MALLEY:

– No; I am speaking entirely for myself. Everybody is aware that my honoured chief is very strong upon defence matters. In fact, he has gone a bit mad upon that . question, just as most honorable members have gone crazy upon the subject of war. The Treasurer has stated that the scheme for arming our Military Forces and equipping them with the most modern rifles - and it should be remembered that the most modern rifles now will be antiquated in a couple of years - will cost£520,000, or $2,600,000. I well remember when the old shot-gun was in use.

It had to give way to the Winchester rifle, which in its turn has ‘been superseded by improved weapons. I would not object, if it were necessary, to a proposal for the foundation of a navy, or - if honorable members thought it better - to entering into a contract with the British Government, under which a greater number of Imperial ships would be stationed here to defend Australia, should ft ever become necessary to do so. If honorable members think it incumbent upon them to waste money upon some kind of military or naval business, let them do as I have suggested. But I shall enter my protest against this expenditure, even if I am the only member of the Labour Party to do so. I now come to the question of the sugar bounties. Whilst I intend to vote’ for the Government proposal in this connexion, I shall do so very reluctantly, because I am satisfied that the bounty will not cease at the end of five or six years. No honorable member ever knew a man to relinquish a good thing.

Mr Kennedy:

– Would the honorable member do so?

Mr KING O’MALLEY:

– No, I never did. I have never known any man or woman to sacrifice a good thing. It is when they grow tired of bad things that they desire to get rid of them in order to obtain good things. The little State of Tasmania is called upon to contribute her proportion of the sugar bounty. There is no doubt that the Colonial Sugar Company will derive the most benefit from the Government policy in connexion with the sugar industry. The gentlemen who are interested in that company bloat about drawing-rooms,and enjoy themselves at the expense of the potato grower of Tasmania. With regard tothe sugar bounty, I know that some members of the Labour Party are in favour of it.

Mr McDonald:

– It is not a party question.

Mr KING O’MALLEY:

– I feel exceedingly doubtful as to the policy of the bounty, and if I finally made up my mind to vote for it, I should do so withvery great misgiving. I now come to the question of the Braddon blot. What is it? It is a sort of constitutional machine for the destruction of the rights, powers, and privileges of Commonwealth representatives in Parliament. Why do the States desire to continue the operation of a section in our Constitution which carries itsown. condemnation upon its face? Why did we federate? Why was the union formed? When a man enters into partnership with another individual he does so from a desire to better his financial position. The’ States having entered into a partnership, I contend that the strong should bear the burdens of the weak. I desire to be perfectly candid. Prior to Federation the States were a segregation of wrangling political nonentities. That condition of affairs has now passed . away, and we have become a great continental nation - a nation of partners and of friends. We have removed all the artificial barriers which existed between the States. That being the case, the Braddon blot should be removed from our Constitution, and the Treasurer of the Commonwealth should not be compelled, when he requires a certain amount of revenue to assist the necessitous States, to raise four times the sum that is requisite to give effect to his desire. Under existing conditions, the Commonwealth Treasurer is absolutely hobbled, handcuffed, and shackled. What would honorable members think if the Treasurer! of the United States were compelled to consult forty-eight States and two territories, or forty-six States and four territories, before he could advance j£i to assist Colorado, Nevada, or any other State of the American union? That is exactly the position in which the Braddon blot places this Parliament to-day. I claim that the whole of the Commonwealth revenue should be placed in one general fund, and that the necessitous States ought to receive advances from that fund, although not more than the amount to which they are legitimately entitled. There ought to be no such thing as an endeavour to make some States bankrupt. But that is the position in which the Braddon blot will place us. A broad-minded Treasurer like the right honorable member for Swan should have the courage to inaugurate a truly Australian policy, under which, instead of pouring millions into the coffers of a State that did not require the money, he would say, “ This revenue shall be distributed as the States need it for their development.” The money should be distributed proportionately, and on reasonable lines. I am opposed to the Braddon blot, because it is based on injustice. The Commonwealth will never be able to establish a system of old-age pensions, or to consider any financial proposal calculated to be really beneficial to the people of Australia, while the Braddon blot remains in the Constitution.

Mr Mcwilliams:

– It is the salvation of the smaller States.

Mr KING O’MALLEY:

– We hear again the voice of the provincialist. I regret that such a remark should have been made by the honorable member for Franklin, because he generally shows the possession -of a broad mind. But, after all, the influence of environment is remarkable. I am thankful that I was born in a great continent - that I breathed the air of the white mountains of New Hampshire arid Vermont. When one lives under such conditions, he has broader ideas than have others.

Mr Wilks:

– Why did the honorable member leave that country?

Mr KING O’MALLEY:

– Because of the Scriptural injunction to- go into the world and preach the gospel unto the heathen. I am also opposed to any extension of the bookkeeping period, for I regard it as another fraud on the Commonwealth. It served a useful purpose at the outset, because it induced some of the antiquated, fossilized relics of the dark ages who then occupied positions of prominence, and were frightened of their own shadows, to support the union. Something had to be done to encourage the States to come in, and the bookkeeping clause was devised to that end. I remember a time, in the history of Canada, when Sir John Macdonald would have been mobbed by the people if an opportunity had occurred; but the day came when Canada gloried in the movement in which that distinguished man took so prominent a part”. Every man who proposes something that is out of the beaten path - something to which the crowd is unaccustomed - is regarded as a faddist or a fool, and it is not until after his death that the people realize, as a rule, that he had brains. I come now to the question of the transfer of the States debts. I must confess that I was amazed to learn that the right honorable member for Balaclava was in favour of the Commonwealth taking over the whole of the debts of the States. I cannot help recalling to mind what was done by the Dominion of Canada in this direction. Why should the European holders of the bonds, stocks, and Treasury bills df the States, who invested their money on the strength of the guarantee of the various States, be allowed to come in, and obtain the guarantee of the Commonwealth that will put millions into their pockets, while, at the same time, they do nothing to enable the Commonwealth to meet future obligations? Let us consider the question for one moment. According to the Treasurer, the States debts now amount to ,£234,000,000, and of that amount no less a sum than £32,000,000 has been borrowed since the establishment of the Federation. If ever there were “ Jubilee plungers,” or bettors on the credit of the States, those who have been responsible for the public loans raised since the inauguration of the Federation may be justly described as such. And yet these men speak of the extravagance of the Commonwealth. As a matter of fact, the Commonwealth is only an infant in its swaddling clothes as compared with the States which have raised £32,000,000 within the last four years. States debts amounting to something like £23,000,000 will fall -due in the course of the next few years, and I absolutely agree with the suggestion made by Mr. Speaker, when a- member of the Federal Convention. I believe the Legislatures of the various. States should pass enabling Acts giving the Commonwealth power to negotiate for the redemption of their loans as they fall due. That power should be given to the Commonwealth without delay, so that the experience of Victoria some eighteen months ago, when she had to pay an enormous bonus in connexion with a conversion loan, may not be repeated.’ If the underwriters concerned had been Hottentots, or cannibals, they could not have attacked the people of Victoria more savagely than they did on that occasion. It is better to eat up a man, than to eat up all that he has, and yet that is what the financiers did in the case of Victoria. The power to negotiate for the redemption of State debts, as they fall due, should be extended to the Commonwealth, and as soon as that power has been vested in the Commonwealth Government, negotiations should be entered into with a view to give effect to it. Is there one State in the union which could ascertain to-morrow the names of the holders of its stocks ? With the exception of South Australia, there is not. Most of the States Treasurers of days’ gone by feared that they had not the ability to negotiate the necessary Loans, and they accordingly farmed out the work to banking companies in England. The banks in turn farmed it out to underwriters, who sold these stocks to various investors. The underwriters know who are the holders of the various stocks of the States, but, as I have said, the Treasurers of the States, with the exception of the Treasurer of South Australia, do not.

Mr Mcwilliams:

– Is that a matter of much moment?

Mr KING O’MALLEY:

– It is a matter of great importance, as I shall be able to show. If the honorable member were doing business with men all over Australia, would he not find himself in an awkward position, if he left the whole of the financial side of his business to be attended .to by a bank? What would be his position if, as his bills fell due, he was told by the bank, “ We cannot tell you who are the holders of your bills “ ? If he could see the holders of his bills and tell them personally of the security he was able to afford them, he would do much better than he would if he had to depend upon the intervention of a third party. To the everlasting credit of the right honorable member for Adelaide, be it said that, as Premier of South Australia, he intrusted the Agent-General with the work of inscribing the stock of the State - a work Hitherto done by the banks. When the Agent-General of South Australia sends out the warrants for the payment of interest on State loans, he is able to say who are the holders of the bonds and stock. Many of the one-time Treasurers df other States, who handed over the floating of loans to various banking institutions, have gone to their graves covered with honour as State financiers ; but if such a system can be described as financing, then it is the easiest thing in the world to become a financier. Let me give another illustration of the difficult position in which the States have been placed1 by the adoption of the practice to which I have referred. The Age and Argus are powerful, wellconducted journals, but if their proprietors farmed out their daily distribution and the collection of advertisements, they would be unable to ascertain what was the reason for any falling off.

Mr Mcwilliams:

– They do farm out their distribution, to a great extent.

Mr KING O’MALLEY:

– That is so; but they closely supervise the work. I know of a case in which the publishing department of one of the newspapers called for an explanation from a lady agent, because it appeared that the opposition paper was securing an increased1 circulation in the district in which she carried on business. In order to give the holders of States bonds confidence in the Commonwealth we should first of all carry the motion, of which I gave notice some time ago, prodding for the imposition of a direct unimproved land tax. I have carefully considered the matter, and have ascertained that we could, by this means, raise from at least 200,000 to 500,000 per annum. Before we talk of taking over the debts of the States, the interest on which, according to the Treasurer, exceeds the whole of the revenue of the Commonwealth, we ought to prove to investors in Great Britain and Europe that we have the means to meet Australian bonds and stocks as they fall due, if they are not prepared to enable us to float conversion loans. That means is to be found in the imposition of a direct unimproved land tax. I would exempt the small land-holder.

Mr Wilks:

– Why should he not bear his share?

Mr Johnson:

– If an exemption were proposed the scheme would be destroyed.

Mr KING O’MALLEY:

– I am a great believer in the system of small holdings. Have honorable members ever heard of a man who was willing to fight for his boardinghouse-keeper? Have honorable members ever heard of a man who would shoulder his rifle for the sake of defending his boardinghouse ? I do not think they have. But we all know that a. man will fight for his wife and children, and his own little home.

Mr Mcwilliams:

– I thought the honorable member wished to nationalize the land.

Mr KING O’MALLEY:

– So I do j, but the trouble is that I cannot induce honorable members to seriously consider the quesnon. Some honorable members accept an invitation to dinner at one of the big clubs, where they hear various statements made about the Labour Party, and thev come back with unfriendly feelings towards that party. As a matter of fact, the Labour Party is a thinking body - it does not think by proxy.

Mr Conroy:

– The honorable member is the only member of it who has been able to say a word wilh regard to the Budget statement.

Mr KING O’MALLEY:

– We propose to have a little to say on the Budget now. My suggestion is that the Commonwealth should impose a land tax and a heavy absentee tax on the incomes of the slanderers and defamers of their country’s name, who live in Europe, and to whom the Treasurer referred in his Budget speech. Ta following motion, of which I gave notice during the sittings of the first Parliament, contains my proposition : -

That in view of the facts -

That during many years the Governments of the several Australian States have been prodigal floaters of loans on the English money market, with the result that at present the six States are loaded with the dead weight of a foreign debt to the enormous amount of over £215, 000,000 - a sum which requires over ,£7,800,000 to meet the interest bill.

Our debt is now ,£234,000,000, and the interest on it over ,£8,000.000 a year.

  1. That no provision exists among the States (with the exception of South and Western Australia) for a practical sinking fund for the redemption of this huge debt.
  2. That it is absolutely necessary to establish a fund similar to that in existence in WesternAustralia in order to rehabilitate the credit of the States - most of the profits produced by this borrowed money having gravitated into the pockets of the large landed proprietors in the form of unearned increment, in consequence of the expenditure on public works. 4- That it is advisable, in the interests of the States and Commonwealth, that large estates should be cut up into small holdings for b’ond fide settlers on perpetual leases, thus preventing the emigration of our healthy, able-bodied young men to foreign countries, in consequence of their being unable to secure homes in the land of their birth.

This House is opinion that the Government should introduce a Bill for the purpose of imposing a graduated land and absentee tax, on the following unimproved capital value basis (no taxation being imposed on improvements, however costly) : - 1. (a) Land of the unimproved capital value of £2,000, or less, to be exempt from taxation.

  1. Land over the unimproved value of £2,000, and under £20,000, to pay £d. per £1.

    1. Land of the unimproved value of £20,000, and under £40,000, to pay jd. per £1. (d,) Land of the unimproved value of ,£40,000, and under ,£75,000, to pay id. per £1.
    2. Land of the unimproved value of £75,000, and under ,£100,000, to pay i£d. per £r. (/) Land of the unimproved value of ,£100,000, and under ,£150,000, to pay 1½d. per £1.
    3. Land of the unimproved value of £150,000, and under ,£200,000, to pay 2d. per £i. (//) Land of the unimproved value of ,£200,000, and under ,£250,000, to pay 3d. per £1.
    1. Land of the unimproved value of ,£250,000, and under ,£300,000, to pay 4d. per £1.
    2. Land of the unimproved value of £300,000, and tinder ,£350,000, to pay 5d. per ,£1. (&) Land of the unimproved value of £350,000, and under £400,000, to pay 5-^d. per £1.
  2. Land of the unimproved value of £400,000, and above, to pay 6d. per £t.

    1. Absentee landed proprietors to pay double the amount of the foregoing rates.
    2. A portion of the proceeds to be utilized for the purpose of establishing a system of national old-age pensions, and the balance to be placed in a reserve fund to partially redeem the several State loans as they fall due.
    3. That this motion, when carried, be an instruction to the Attorney-General to prepare the necessary measure- When this becomes law it will shift the incidence of cruel taxation from the backs of the small holders to that of the Monopolistic Boodle Bludgers who have turned the people’s heritage into a sheep-walk.

We can raise from £1, 200,000 to £1,500,000 annually, and I suggest that the Commonwealth should secure a piece of property in the heart of London, and on it erect a building which will cost in all between £200,000 and £300,000. At the present time, the Governments of the various States have offices for their Agents-General all over London - some of them near the Parliament Buildings at Westminster, away from the business centre of the city, where no one ever goes. The office of AgentGeneral should, in my opinion, be abolished, and general agents should be appointed in their stead. An Agent- General should be a thing of the past, because everything now is hard, progressive, cruel, murderous business. The Commonwealth could dig down deep, and have great basements, and subbasements, on its property, where the winegrowers of Australia could store their wine. Then in the building they could provide offices for the “ general agents of the six States, and on the top storey they could have a show room for the exhibition of the produce of the States, with the States’ tag on everything, the remaining space to be let. Unless a nation advertises today, just as individuals do, it must go to sleep, and become covered with blue mould ; and the best way in which we can effectively advertise is by making patent the substantial potentialities of Australia, by the means I suggest. In the Commonwealth building would be lifts or elevators to climb up or down, and there could be a restaurant in which nothing but Australian wine, and food prepared from Australian commodities, would be sold. If this seems too socialistic a proposal, the Government could lease the right to conduct such a restaurant, and persons would soon be found to tender for it. By renting the various rooms in the building, we should get an enormous income. If we borrowed £300,000 at 3 per cent., on interminable stocks or bonds - and stocks are better than bonds, because the latter have coupons attached which are a nuisance - we should have to pay £9,000 a year in interest, and a good landed investment in London is supposed to pay at least 7 per cent.

Mr Conroy:

– The man who could point out safe investments of that kind would make thousands.

Mr KING O’MALLEY:

– Seven per cent, can be obtained from investments in property in the heart of cities like London, New York, Chicago, and even Melbourne. Seven per cent, would give us a return of ,£21,000, while 6 per cent, would give a return of £18,000 a year. Out of that the municipal rates would have to be paid ; but it would be unnecessary to insure the building, because the Commonwealth is stronger than any insurance company. I wrote to the Under-Treasurers of the States, to ascertain what each State pays for rent in London, but the only reply I have yet received came from the Under-Treasurer in Tasmania, who said that that State pays £275. Of course, Tasmania is a small State, and if we estimate the average amount paid by the States at £5°° 01 £6o° each, or £3,000 in the aggregate, I do not think we shall be far wrong,. That at once meets half the interest charge. I would insist on the High Commissioner having absolute power in connexion with the inscribing of the stock issued, and would allow him to float his loan at any period when he was likely to get money cheaply. Having the stock on his books, the Commissioner would know by whom it was held, just as an insurance company knows who are ifs policy-holders, and could make it his business on occasions to see the larger holders, or to write to the smaller holders, offering them inducements to continue to hold the. stock in the event of our Joans falling due. At the present time, because of the stories in circulation about a certain institution, many persons are frightened; but their fear’svanish when one sees them, and tells them that things are all right. Unfortunately, the great multitude is carried away by clamour and rumour, and is ready to sell its stocks, or dispose of its investments, to save itself from what it thinks threatened disaster, but the rich man who keeps his fingers on the financial pulse of the world knows what is happening, and’ buys the stock, doubling the value of his investment in a few months. The Commonwealth should not delay to erect, in the heart of the city of London, a building which would be a monument to the business ability of the people of the country, and would enable their produce to be properly exhibited to the people of Europe. About every year or two there are celebrations of one kind or another in London, and the Commonwealth building’ would, on such occasions, be crowded with sightseers, who would gain a knowledge of what we have to offer to emigrants, and would spread the fame of our resources. I find from official records that the land of Australia is valued at £373,679,000, and the improvements on it at £375,515,000. The incomes drawn from investments by persons non-resident in Australia amount to £8,350,000, and £400,000 is spent annually by Australians residents in Europe. Of the first-mentioned amount, . £2,565,000, or nearly 4 per cent of the total incomes in the State, apart from the interest paid upon State debentures, is drawn from New South Wales ; £1,600,000, or 3 per cent. is drawn from Victoria; £1,100,000, or 5½ per cent., from Queensland; £375,000, or 2½ per cent, from South Australia; £2,300.000, or 13 per cent., from Western Australia ; £360,000, or4½ per cent., from Tasmania. The incomes drawn in the Commonwealth represent a total of £179,000,000, andthe incomes in New Zealand represent a total of£38,967,000. £8,750,000, or slightly over 5 per cent. of the total of the incomes derived from private concerns in the Commonwealth, is drawn by non-residents. These people, who enjoy all the. social advantages ofliving in the centres of art andculture, should, I think be made to specially pay the Commonwealth for policing their properties It is not fair to the residents of Australia, who rear their families in the country in which they make their income, that no distinction should be made in matters of taxation between them and persons who live in Europe. It is hard for an Australian Treasurer, owing to his environment, to present a policy which will have the effect of treading on the toes of absentees, but, I think, it is time that some action was taken in this direction. The Treasurer did not say one word with regard to the establishment of a Commonwealth Bank of issue and deposit. This is a very important matter. We are, to-day, living under a banking system that Sir Robert Peel gave to the world in 1844 or 1845. No improvements have been made during all the years that have elapsed, and it seems most remarkable that, whilst changes are being made in all other kinds of economic institutions, whilst wonderful improvements are being effected in the methods of the pro duction and distribution of wealth, and whilst the remotest nations of the earth are being brought into closer connexion by the magic touch of commerce, and whilst the whole industrial and commercial world is passing through a process of evolutionary transformation, no change should be made in the antiquated and obsolete system of currency, which has been in existence for the last sixty or seventy years. The currency being the very lifeblood that circulates through the veins of the nation, I was glad to hear the honorable member for Brisbane address the House on the subject of establishing Commonwealth currency, although I could not altogether appreciate some of the features of the system which the honorable member advocated. Under his proposal, the State would receive from the banks only one-third of the value of the notes issued to them in gold, and the banks would have to pay only 2 per cent. interest on the other two-thirds of the total face value of the notes. I understood, further, that the banks would be in a position to get back their gold upon returning the paper currency. I should think that a better return to the State would be secured if the banks were required to pay 2 per cent. interest on the full value of the note issue.

Mr Culpin:

– But the State would hold the banks’ gold to the extent of one-third of the value of the notes issued.

Mr KING O’MALLEY:

– Yes, but unfortunately the banks could get the gold back upon returning the notes, and I do not like giving anything back once I have got it. I do not think that any great profit is to be derived from the issue of paper money, but that system has great advantages, in so far as it engenders confidence in the State. Moreover, if a State bank of issue were established the power now enjoyed by a monopoly consisting of a few private bankers would be vested in the State. At present bankers frequentlyencourage booms by urging people to borrow money when it is plentiful, and they bring about the collapseof such booms by calling upon their debtors to pay them at a subsequent stage when money becomes scarce. If the State had the control of the issue of paper money it would refuse to increase its note circulation in order to assist a boom. If there were a prospect of a boom the State bank would commence to cancel its circulation, and this would have a discouraging effect upon those who were disposed to over-speculate. On the other hand, in times of great trouble, the State bank could increase its circulation, through the agency of the post-offices. It may be urged that no one would have confidence in a Government bank, but Coghlan points out that the States savings banks had a wonderful boom at the time of the bank crisis in 1893, because the people had confidence in them. If we had a Commonwealth bank of issue it would be able to do business with farmers and producers, who, however, would not be granted overdrafts unless they deposited securities in the forms of deeds, bills of lading, bills of exchange, bonds, or bills of sale. The result would ba that the State bank would encourage the small producer and the small business man. Unfortunately, the present banks of issue unconsciously help big men, who can come to them and borrow thousands upon “depositing their deeds. The enormous profits made by the Australian banks is at the expense of the whole people who have to pay the interest, discounts, and exchange. Both the borrowers and bank employes are sweated to fatten the shareholders, as shown by the following table from the Australasian Banking and Insurance Record of 20th January, 1905, from which I will read some figures: -

After all it is only that portion of the bank deposits represented by the savings of the workers, or the surplus accumulations of commercial and financial organizations, which is available for investment. The balance, which constitutes by far the larger part of the deposits, represents only an expansion of credit, and is never available for investment of any permanent character. It is a common blunder to regard bankdeposits as money in the banks, whereas they are principally composed of credits in a ledger. When a banker lends a customer £’10,000, he takes the customer’s promissory note, and credits his account -with the proceeds. The transaction in creases both tha deposits and loans bv £10,000, but does not adel anything to the money in the bank. Even when the customer operates by cheque on the credit it does not necessarily follow that the money in the bank is reduced, tor his cheques either go to the credit of other customers of the hank, or they find their way into other banks, and become an offset by similar transactions. This credit of £10,000 produced) by the banker discounting the promissory note of his customer, performs all the functions that actual money can perform, and practically adds £10,000 to the resources of the commercial community while it is extant. If the credit has been judiciously given, the note will be redeemed when due by the customer accumulating a sufficient credit balance in his bank account to redeem the note. The transaction will reduce the banks assets and deposits by £10,000, but it will not increase nor diminish the money in the bank. In only a small proportion of the financial transactions thus accomplished by credit will actual cash be demanded, and against this the banker must retain a certain percentage of his deposits in cash reserves. If the credit be foolishly given to a worthless speculator who cannot pay when the money is due, or make satisfactory arrangements, then the bank loses the amount, because its resources are reduced by £10,000, while its liabilities remain the same. In the difference between redeemable and irredeemable credit rests all the difference between good currency and bad currency, between good banking and bad banking, between good investment securities and bad investment securities. Thus . the increase of bank deposits is clue more to an expansion of credit than to an increase, of actual money in the banks, or of funds in search of investment. In like manner, when deposits decrease it is a contraction of credit, rather than the withdrawal of money from the banks. In 1893 there was far more money in the banks of Australia than in 1892. Yet the deposits were millions less on account of the contraction of credit primarily due to the crisis, the loans, and Other credit assets being relatively reduced. This borrowing, banking, and rate of exchange question need not frighten us. Many years ago the Baring Brothers loaned to the South American Republic because the rate of interest was much higher than in. America or Australia. When the rate of interest is higher in Australia than elsewhere, the financiers and capitalists will lend the people here money instead of buying foreign commercial bills, causing Jess, demand for bills, and therefore lowering the rates. If rates of interest are higher in other countries, there will be a greater demand for commercial bills or other exchanges on foreign countries with the object of getting the benefit of such high rates. If the interest rates for money are lower in other countries than here, Australian financiers Would borrow money in their markets, and loan it here, thus increasing Australian indebtedness to foreign countries, and on the falling due of these loans there would be an increased demand for exchange to pay them, resulting in higher rates. The fluctuation in the rate of exchange is due to many causes. If the value of the commodities exported’ by Australia greatly exceed the value of the commodities imported during a certain period, the large balance due to us from other countries would, if there were no other international transactions to offset them, cause the lowering of the price of exchange here for the reason that there would be less demand for remittances to foreign countries, since it is always the difference between the debits and credits that is remitted. On the other hand, if we owed foreign countries more than they owed us, exchange would be higher by reason of the increased demand for it.

Mr Henry Willis:

– Is the honorable member in favour of tha conversion of the States debts?

Mr KING O’MALLEY:

– I am in favour of the Commonwealth taking them over gradually. I claim that we should acquire power from the different States to go upon the money market, and to buy up these loans long before they become due.

Sir Philip Fysh:

– How can we do that ?

Mr KING O’MALLEY:

– We can do it when the stocks are being sold.

Sir Philip Fysh:

– Where shall we get the money?

Mr KING O’MALLEY:

– We can get it by imposing a land tax.

Sir Philip Fysh:

– Can we obtain £200.000,000 in that way ?

Mr KING O’MALLEY:

– No. There is not £200,000,000 falling due at the same time. As a matter of fact, we have /.’23, 000, 000 worth of loans maturing within the next five years. I believe that the Commonwealth should be given the power to at once commence negotiations in respect of those loans. I claim that if we imposed a land tax, and if we had £5,000,000 in the Commonwealth Treasury we should experience no difficulty in regard to renewing our loans.

Sir Philip Fysh:

– Does the honorable member favour the abolition of the State land taxes?

Mr KING O’MALLEY:

– I would like to see a uniform land tax imposed all over Australia. A tax of a penny in the pound would realize £1,500,000 a year. The bonds of the Commonwealth, backed by the States, are surely worth more than State bonds would be, unbacked by the Commonwealth. Ninety per cent, of the business of the world of to-day is openly done by credit, and the other 10 per cent, is transacted by other forms which are equivalent to credit.

Mr Conroy:

– How does the honorable member define “ credit “?

Mr KING O’MALLEY:

– I define it as confidence. Credit and confidence go hand in hand, and if we had a million pounds extra coming in annually, the people in England would have confidence in us. The lands of the Commonwealth are valued at ?373,000,000. That value has been imparted to them by the working people of this country. Let us impose a tax upon these lands, and show the English bondholders that we are able to pay off a portion of our indebtedness ; then we shall experience no difficulty whatever in gaining renewals to suit our own convenience.

Mr Conroy:

– If we passed a law raising the price of land tenfold, can the honorable member, as a sound protectionist, say how would it act, seeing that the money would still be kept in the country?

Mr KING O’MALLEY:

– I say that protection and a land tax go hand in hand.

Mr Conroy:

– That is to say, that all taxes are good.

Mr KING O’MALLEY:

– Every honorable member who has had any business experience must know that whenever he has had a mortgage upon his property, if he has offered to pay off a portion of it, he has experienced no trouble in procuring an extension. Our English bond-holders occupy a position precisely similar to that of mortgagees.

Mr Webster:

– The honorable member should not make a mistake. If our bondholders have a good investment, naturally thev will stick to it.

Mr KING O’MALLEY:

– Has the honorable member noticed that the bonds of one State in the Commonwealth, which mature in about four or five years, are now quoted at ?88 per ?100? I say that the Commonwealth could purchase those bonds and establish a sinking fund. If 1 per cent, were paid into a sinking fund, the Treasurer, through the High Commissioner, would be in a position - as that fund increased - to watch the state of the- money market, and to take advantage of it in the same way that any other purchaser does.

Mr Conroy:

– Is the Treasurer to engage in gambling?

Mr KING O’MALLEY:

– That would not be gambling. The States go into the open market and offer their stock for sale.

Mr Conroy:

– The Treasurer is to collect the funds of our citizens and wait for an opportunity to purchase State bonds.

Mr KING O’MALLEY:

– The Treasurer would receive a certain amount from land taxation each year. He would be paying off the States debts, and thus relieving them of a terrible burden. Everybody recognises that if the Braddon blot were removed from our Constitution, and the Commonwealth had ?2,000,000 or ?3,000,000 of a surplus above what is required to help the States, the Commonwealth Treasurer would be in a very different position from thatwhich he would occupy if he had to face a deficit each year. Credit is the most potent economic force of the age, and credit rests upon confidence. The whole financial fabric of the world to-day virtually rests upon credit. How much gold is there in circulation in England or Australia? We have not ?10,000,000 worth of notes, gold, and silver in circulation in the Commonwealth, and yet we are doing a business equal to ,?94,000,000 annually.

Mr Higgins:

– We have ,?22,000,000 of gold on deposit.

Mr KING O’MALLEY:

– I am speaking of the amount in circulation. How much gold is there in circulation in England? Mr. J. Wilson Harper, speaking of this aspect of the matter, says : -

Gold plays an important but subordinate part- The extensive use of credit bills, promissory notes, and bank notes, has far more to do with the maintenance of our monetary system. If it had to completely rest on gold it would soon crumble to dust.

According to Mr. Clare, the whole stock of legal tender does not exceed ?126,000,000. His remark has reference to the United Kingdom. He adds -

From half to two-thirds of this amount is in actual circulation among the public, ?50,000,000 or ?60,000,000 being available for banking purposes.

Mr. McLeod says

There are about ?110,000,000 in actual coin in the country, and credit to the amount of ?10,890,000,000 rests upon that.

Dean Farrar estimates the entire capital at ?12,000,000,000, and says that ?235,000,000 aire yearly invested and saved. Mr. Laver states that the chief London banks, exclusive of the Bank of England! hold cash in hand to the extent of £27,000,000, and that a debt of £227,000,000 rests upon that sum. The estimate made by the Committee ‘ of experts who recently issued their report on Indian currency is much less than those just cited ; but coming from such financial authorities, it may be accepted 00 the whole as most accurate. It is stated that -

In the United Kingdom the amount of gold and silver available for purposes of currency is uncertain, but the Mint estimate of the gold in circulation is ^91,000,000, of which the amount in banks, including that in the issue department of the Bank of England, and in other banks against which notes are issued, is stated to be ^25,000,000.

The report further explains that the gold held by the issue department of the Bank of England, and that held by -

The Scotch and Irish banks, in respect of notes issued beyond the authorized limits, cannot be looked upon as an integral portion of the currency, since it cannot be used at the same time with the notes that are issued against it. But the amount is included in the sum of ^91,000,000.

If that enormous volume of business . is done on a credit basis, of what are we afraid in Australia? Turning to Cog/dan, page 801, we find th% statement -

The savings banks are on a very different footing, being, to a greater or less extent, under State control, and otherwise safeguarded, so that they enjoy public confidence.

If the savings banks enjoy public confidence, because they are guaranteed bv the Government, would not the people Wave confidence in a Commonwealth bank of deposit and issue?

Mr Conroy:

– It would depend on the way in which it was conducted.

Mr KING O’MALLEY:

– Let me illustrate my point. When a city suddenly springs up for which an adequate water supply has not been provided, what is the first step taken by those in authority ? They fix upon a catchment area. Then they build a great dam- or reservoir into which the water is directed Mains are next laid from the reservoir to the city, storage basins being excavated along the line, and by means of service pipes the water is conveyed to every household, and the whole city is supplied. I hold that there is not a sovereign or a half-crown piece that was’ not dug out of the earth by some working man or working woman. There was no property in the Garden of Eden - there was not a dollar to lie found there ; and every pound that is necessary to pay off the national debt must be earned by the working men of Australia. If that be so, why should not the savings of the workers flow through the various post-office savings banks into a Commonwealth Government national bank, and be utilized for the benefit of the workers of Australia ? To-day the wealth of the world is flowing from the pockets of- the workers into those of great organizations of private gentlemen who boss the wealth of the earth. These gentlemen have made their wealth out of the labours of the workers of the world, and the Labour Party is determined to introduce a new system under which not a dollar will be taken from those gentlemen; but under which they will be unable to take a dollar that they do not earn.

Mr Kelly:

– Will members of Parliament secure a proper allowance under that system?

Mr KING O’MALLEY:

– I am glad that the honorable member has reminded me of that point. To the everlasting discredit of the Government and their predecessors, be it said, that the function for which they came into office - the function of feeding the people - has never been fulfilled. Honorable members are to-day receiving a starvation allowance - an allowance that is absolutely disgraceful. If we do not believe in the principle of payment of members, let us wipe it out ; but if we are to have payment of members, the allowance should be commensurate with the duties to be discharged. If honorable members received an allowance of £600 or £700 a year, it would be unnecessary for them to engage in private business. .1 hold that no man can conscientiously attend to his Parliamentary duties and at the same time control a private business. A member of Parliament must either resign his seat or let his business go. The Government should pay no regard to press criticism. Thank God, the newspapers do not run this Parliament; and if the Ministers are afraid to. tackle this question seriously - if, like other Governments, they are simply waiting for something to turn up - they will in time be turned down. I fought the last general election on the public statement that I favoured an allowance of £1,000 a year, and I hold that there is no justification for giving members of the Parliament only £400 per annum simply because the Com.stitution sets forth that such shall be tlie allowance “until the Parliament otherwise provides.” The right honorable member for East Sydney has often admitted that he made a great mistake when, as a member of the Federal Convention, he moved to amend the clause in the draft Constitution Bill providing that the allowance should be £500 per annum.

Mr Phillips:

– Then why does not the right honorable -member seek to rectify his mistake ?

Mr KING O’MALLEY:

– How could he possibly rectify it when his Government had only a majority of one? The Government have a substantial majority, and most honorable members of the Opposition would support a proposal by them to increase the present allowance. I am prepared to vote for an allowance of anything up to £600 a year.

Mr Kelly:

– Would the honorable member vote for nothing over that, amount ?

Mr KING O’MALLEY:

– I do not think it would be fair to ask for more. I appeal to the Government not to be scared by newspaper criticism, but to have the pluck to bring in a Bill providing for an increased allowance. In conclusion, . I have only to say that I thank the Treasurer for having administered a much deserved castigation to those treacherous men who were beggars when Australia found them, and who, having become millionaires, visit Europe from time to time, and denounce the land that made them. But let them go. Australia, with its mountains and its valleys, its hills and its dales, its rivers and its plains, its harbors, its villages and its cities, its lovely women, and its champion racehorses, still remains. Let these men go. Australia - with its music, sad and thrilling - with its cosy homes, its winters of mildness, and its summers of healthfulness; - where bloom and flourish the finest specimens and virtues of the British race, still remains.

Mr McCAY:
Corinella

– I do not know whether, after the poetical outburst of the honorable member who has just resumed his seat, the Committee will be willing to come down to the prosaic walks of life with which a Budget speech and a Budget debate are usually associated. But there are a few remarks which’ I should like to make, first, in connexion with the finances, and, secondly, in connexion with that portion of the expenditure of the Commonwealth which relates to our defences. So far as one can judge from the inquiries that could be made during the period which has elapsed since the delivery “of the Budget speech, a pronounced feeling of apprehension has been caused by the Treasurer’s remarks. The public mind is alarmed, and not without reason, at the general tone of the speech.

Sir John Forrest:

– Where is the public mind situated?

Mr McCAY:

– It is not situated solely in the right honorable gentleman.

Sir John Forrest:

– Does the honorable and learned member mean everywhere - all over Australia?

Mr McCAY:

– I mean everywhere, all over Australia ; with the exception, perhaps, of those realms in which the right honorable gentleman holds, or held, exclusive sway. I think that the public have reason for alarm in the attitude adopted by the right honorable gentleman, who is supposed to be the custodian of the finances of the Commonwealth, and to watch over its expenditure, so that no extravagance and no unnecessary outgoing of the public funds shall take place. But the right honorable gentleman told us, in effect, that in future the States must expect to get back not more than the statutory three-fourths of the net Commonwealth revenue to which they are entitled under the Constitution.

Sir John Forrest:

– My predecessor told them that at Hobart, in even plainer language than I used.

Mr McCAY:

– The right honorable member for Balaclava stated that the expenditure of the Commonwealth would inevitably grow until that result happened; but he did not announce the fact in tones of triumphant exultation.

Sir John Forrest:

– I did not say anymore than he did.

Mr McCAY:

– The right honorable gentleman said, in the tones of one who rejoiced in the fact, that the Commonwealth expenditure would be increased.

Sir John Forrest:

– Although the honorable and learned member sits in opposition to the Government, he need not be unfair. ‘

Mr McCAY:

– No ; and I have not been so.

Sir John Forrest:

– I think that the honorable and learned member is unfair.

Mr McCAY:

– The right honorable gentleman wishes to be both a member of the Government and a member of the Opposition, to direct the operations of both parties. If he succeeds in doing that, everything will go to his satisfaction. His attitude in regard to finance is well known. We have heard him say in this Chamber, when speaking of expenditure, “ Pooh, what is a million? “

Sir John Forrest:

– My reputation for economy and good management will stand against that of the honorable and learned member, if he has any.

Mr McCAY:

– I have always been compelled to practice economy.

Sir John Forrest:

– I mean as an administrator.

Mr McCAY:

– The spectacle of the right honorable gentleman claiming credit as an economical administrator is one to make both gods and men laugh.

Sir John Forrest:

– If the honorable and learned member goes to the State whose affairs I administered for so long he will ascertain what the people there think of me.

Mr McCAY:

– I remember hearing the right honorable gentleman say in this Chamber, when a question arose as to the anticipation of parliamentary appropriation, “ When I wanted a few hundred thousand pounds, I took the money, and spent it.” Economy ! There must be a special definition of the word in the political dictionary of Western Australia.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– There is no quicker way to become popular than to spend money.

Sir John Forrest:

– The honorable and learned member for Corinella has recently been to Western Australia, and should, therefore, know what I did there; and should be a good judge of my, actions.

Mr McCAY:

– I do not know if the right honorable gentleman proposes to allow me to say the few words I wish to say with a comparatively small number of interruptions. Notwithstanding his long parliamentary experience, no one is so impatient under the mildest criticism and the gentlest of suggestions as he is. He has not a reputation for economy.

Sir John Forrest:

– The honorable and learned member should give us facts, and not fiction.

Mr McCAY:

– I am trying to do so. The right honorable gentleman has not a reputation for being economical. He tells us that that reputation is entirely undeserved; that of all mortals he is distinguished for his economical aspirations, efforts, and results.

Mr Kelly:

– Is that why there were no defences in Western Australia?

Mr McCAY:

– That may be the reason why the Commonwealth is now paying so large a sum for the construction of new works and buildings in Western Australia. The right honorable gentleman is so economical that he left it to the Commonwealth to undertake this expenditure. No State in the Union is, rightly or wrongly, benefiting so much by the practice of charging new works and buildings to the Commonwealth on the population basis, as is the State of Western Australia.

Sir John Forrest:

– I deny that ; I take exception to that statement.

Mr McCAY:

– Apparently nothing I can say will satisfy the right honorable gentleman. When I said that he was not economical he complained ; and now that I am saying he was economical, and am pointing out these results of his economy, he is still complaining.

Sir John Forrest:

– The honorable and learned member says that Western Australia is gaining more advantage than any other State. Western Australia has to pay as well as to receive.

Mr McCAY:

– No doubt the right honorable gentleman refers to the special Tariff of that State.

Sir John Forrest:

– No. Western Australia pays a good deal towards the sugar bounties.

Mr McCAY:

– The State pays in accordance with its population; but it gets a bigger proportion of the general expenditure of the Commonwealth on works and buildings than does any other State.

Sir John Forrest:

– I question that.

Mr McCAY:

– The cost of the defences of Fremantle alone more than eat up Western Australia’s contribution to the £400,000 which is to be spent on new works and buildings.

Sir John Forrest:

– How much has already been spent at Fremantle?

Mr McCAY:

– Up to the present time a few thousand pounds. The right honorable gentleman, in the Estimates of which he has charge, has a little item of £45,000 or so. to be expended there. He tells us now that he does not think the Braddon provision should be extended when its operation has expired.

Sir John Forrest:

– When did I say that?

Mr McCAY:

– Apparently the right honorable gentleman forgets what he said in the Budget speech. It is not that he had so much to say in that speech that he need have forgotten what it contains, because one of the complaints I have to make is that he told us very little indeed about the position of the finances.

Sir John Forrest:

– I have before me a report of my speech.

Mr McCAY:

– I have not committed the speech to memory, so that I cannot quote the exact words ; but does the Treasurer deny that he indicated that he did not think the Braddon provision should be extended ?

The CHAIRMAN:

– The Treasurer will have an opportunity to reply later on to any statement made by the honorable and learned member, and that, I think, will be a better course for him to pursue than to reply now.

Sir John Forrest:

– Yes ; but when an ex-Minister criticises the Government’ he might be accurate in his statements.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The trouble is that he is too accurate.

Mr McCAY:

– Nothing I have said yet can be impugned on the ground of inaccuracy. I have endeavoured to do the right honorable gentleman the utmost justice. When be disputed the correctness of certain statements in regard to his conduct, I attributed to him an opposite line of conduct; but he still remained indignant, though one or other of my statements must have been correct. I am afraid it will be impossible for me to please him.

Sir John Forrest:

– I d’o not wish the honorable and learned member to please me; I only desire him to be just.

Mr McCAY:

– I am thankful to the right honorable gentleman for the privilege allowed me of speaking on the Budget, whether my remarks please him or not. I repeat what I said at the outset, that the whole tend’ency of his speech is a promise to the Commonwealth that more money is to be spent. Do not we remember the tones of regret with which he announced that he was spending merely £400,000 upon new works and buildings? I do not remember his exact words, but he said in effect - and perhaps he will break through his usual practice, and correct me if I am in error - - 1

Sir John Forrest:

– When the honorable and learned member proposes to criticise my conduct he should have the facts in his possession.

Mr McCAY:

– The right honorable gentleman pointed out that £400,000 was a small, almost a trifling, sum for this great Commonwealth to spend, even though it had to be obtained from revenue. That did not . strike me as the utterance of a gentleman of an economical turn of mind. It seemed to me rather the remark of one who, rightly and properly, no doubt, sees great opportunities of doing great good by the expenditure of great sums of money ; but who, not having great sums of money to spend, regrets, the loss of those great opportunities for doing great good. That is an excellent and praiseworthy frame of mind. But the taxpayers of Australia, who understand the burdens, and do not always immediately realize the benefits, of expenditure, do not regard the situation with the equanimity with which he regards it. I have no great fault to find with the Estimates, particularly as they have the advantage of being to a large extent those of the preceding Government, and therefore display on the whole Chat due regard for economy which the right honorable gentleman’s remarks do not seem to promise. It is true that they provide for a number of increases. There is, for example, an increase in connexion with defence expenditure. £51,000 more is to be voted for the naval subsidy. Last year, however, we paid only- three-fourths of the annual subsidy, so that the remaining one-fourth was returned to the States. Then there is an increase of about £25,000 to provide for sugar bounties, in connexion with a policy on which the Commonwealth deliberately embarked, for at any rate a limited period, and those who believe in that policy should be glad to see that the amount claimed is increasing, because that fact signifies that the area of the cane-fields cultivated by white labour is extending. There is an increase of £120,000 on last year’s works expenditure, of which some £50,000 is comprised in re-votes ; and there are a number of large works, like the proposed’ telephone line between Melbourne and Sydnev, to be undertaken.

Mr Poynton:

– Is not that work to be paid for on a population basis?

Mr McCAY:

– All new works are to be paid for on a population basis, and I think that before we agree to them we should have some reasonable assurance that they will be remunerative. Then there is an increase of some £40,000 in the proposals for expenditure on defence. That is largely owing to necessary expenditure in connexion with the proper equipment of the forces, as to which I propose to say a word or two later on. It may, however, fairly be stated that in the Estimates about to be submitted for consideration there is no reasonablesign of extravagance or increased extravagance on the part of the Commonwealth. I have already pointed out that, as these are largely - practically wholly - the Estimates of the preceding Government, the last Administration and the present one must share alike in the praise or blame that may be bestowed in that connexion. It is the next Estimates that we view with apprehension, because it may be that the right honorable member for Swan will still be Treasurer when the next Estimates are framed and introduced - that is, if he still remains in Australia, and does not join that party which has been so violently reprobated by the honorable member for Darwin this afternoon. In an utterance like the Budget speech of the Commonwealth, one may expect to hear from the Treasurer some definite proposals upon the great financial questions that are agitating the public mind, and I do not know whether I shall be fortunate enough on this occasion to secure the concurrence of the Treasurer, when I say that, unfortunately, he gave us no definite information on any subject.

Sir John Forrest:

– That is a matter of opinion, upon which the honorable member has a perfect right to express his view.

Mr McCAY:

– I think I may be permitted, without being egotistical, to congratulate myself upon having said something that the right honorable gentleman permits me to say. In his Budget speech, he spoke about the sugar bonus. He told us in general terms that the bonus was to be extended j but he did not state for what period, and he was equally silent upon one or two other important details. It may be that the right honorable gentleman’s association with the Prime Minister, who is frequently up in the clouds, has developed a little of the same nebulous state of mind in himself. He told us that we must increase our population. He gave us a glowing account of Australia, her resources, her wealth, her people, and her future, combined with the fact that we were not increasing our population, and he said that by assisting immigrants with cheap passages, advances from land banks, and grants of land from the States, we should be able to increase the number of useful inhabitants of Australia. He did not tell us how far, if at all, his arrangements with the States Governments had proceeded, or as to what negotiations, if any-

Sir John Forrest:

– How could I do that? What time had I to do that?

Mr McCAY:

– I do not suppose that the right honorable gentleman could have done so, for the very good reason that no negotiations had proceeded. A vague general statement such as he made, which has no practical work done in connexion with it, is not of very much use to the Commonwealth. When the right honorable gentleman did venture to express one or two opinions, and was asked whether he was announcing the Government policy, he said that the Government had not yet considered this or that subject. The complaint I have to make about his speech, rightly or wrongly, is of- a twofold character, that, in the first place, it- aroused alarm as to the probable future expenditure of the Commonwealth, more especially in connexion with the significant change which has occurred in the right honorable gentleman’s mind with regard to the Braddon section, and, in the second place, on those great questions of public policy, upon which the country is entitled to have definite information with regard to the attitude of the Government, no word was forthcoming.

Mr Poynton:

– Why did not the Government, with which the honorable and learned member was connected, tell us what they intended to do?

Mr McCAY:

– Because it was unfortunately cut short in the flower of its youth, just when it was about to submit a series of valuable proposals. We have our policy ready for future operations, and will unfold it when we have the opportunity we so much desired of asking the public to determine whether it is wholesome. The Treasurer also referred to the fact that Australia is being decried. We all agree upon that point, and, further, that it is being unjustly decried, but we must remember that we have given some foundation for the superstructure of decrial that has been built up. There is a little fire to cause the very large amount of smoke. Let us take the case, which occurred only the other day, of the groom who came from England to New South Wales. As, I understand the matter, that groom was engaged to comte from London to some inland part of New South Wales under contract to deliver horses.

Sir John Forrest:

– That was done under the Government with which the honorable and learned member was connected.

Mr McCAY:

– It was done by the AgentGeneral’ in London. The Act under which the certificate was issued was not introduced by the Government of which I was a member. I do not profess to know enough about the facts ito be able to say whether this man required an exemption certificate, but I contend that the contract labour section of the Act affords reasonable ground for any ordinary business man to assume that such a certificate was essential ito enable the man to proceed with the horses to his destination. At all events, if the business man concerned made a mistake, he erred on the side of safety in procuring a certificate.

Mr Poynton:

– Did not the honorable and learned member vote for that particular provision ?

Mr McCAY:

– I have no objection to the principle embodied in the section. It was adopted for two specific purposes, namely, to prevent men being brought into Australia under contract to work at less than the prevailing rates of wages, and under worse conditions than the ordinary - a most wholesome object - and to prevent employers from utilizing outside labour as a means of cowing their workmen with whom they might have a difference at a time of strike, or when a strike was impending. We may reasonably hope that, in view of the extension of legislation for conciliation and arbitration throughout the States, we shall not be much troubled with this form of industrial dispute in the future. At any rate, these were the main objects which the section was intended to serve, and I do not for a moment wish to prevent them from being maintained. I contend, however, that the section as it stands lends some colour - I do not say justly so - ito the representations of those who are evilly disposed to Australia, and affords them an opportunity of making statements which are very damaging to us. I never concurred with a great deal of the harsh criticism that was employed in connexion with the six hatters’ case, or with most of what was said in connexion with the Petriana case. I think that the great bulk of the criticism directed at our past legislation has been unjust and unwarranted, but there is just enough foundation for it to enable those who wish to do so to still build up a number of damaging allegations, and I should like ito see it made clear by legislation or administration that white people who want to come to work here under prevailing conditions, and who are not brought here in’ order to confer an advantage upon one of the parties to a dispute, shall be able to do so. This should be done, so that we may not continue to leave ourselves open to the charges which have been made, however” unjust and unfounded we may know them to be. I do not wish to see our legislation so modified as to prevent the great, important, and valuable objects to which I have referred from continuing to be carried into effect. It is largely a false impression that has been conveyed to the minds of the British public in connexion with that provision, an impression that Australia has passed class legislation instead of legislation for the good of the whole community. But legislation, such as the union trade mark provision, for instance, with all the implications that can be built upon it - as that provision stands, I think it is open to objection, but there are other implications that can be built upon it - afford just a sufficiency of foundation for the allegations made against us, to render them difficult to answer. These facts, together with the knowledge that the Treasurer and others are compelled, by the necessities of the political situation, possibly to subordinate their own individual views in matters of this kind, and to concur in the passing of legislation that they do not in their hearts approve of, render it difficult for those who have the welfare of Australia at heart, to do what ought to be done in order to keep the name of the Commonwealth in as good odour as we should like. I desire to say a word or two with regard to the bookkeeping period in reference to which the Treasurer is reported in Hansard, at page 1 2 13, as having said -

Unless some better arrangement can be made -

That is beautifully definite - a most important qualification. 1 certainly think that the only thing to do is to continue the bookkeeping period until the end of the operation of the Braddon clause-

The honorable member for Capricornia asked -

Do the Government intend to do that?

Then the Treasurer, with the caution that characterizes him, said -

I am not prepared to make a definite statement on that point.

He is not reported as having, said “nor any other,” but he might as well have said it.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– That is statesmanship.

Mr Page:

– It is like one of the statements of the right honorable member for East Sydney.

Mr McCAY:

– When honorable members have to resort to tu quo que argument they are hard put to it. We have already taken a step in the direction of what we might call the true finance of Federation by charging all our expenditure in connexion with works and buildings upon a population basis. That is a step of which I approve in spite of the temporary disadvantage that results to one or two States that are more- forward than others. I do not particularize the States for fear of interruption. I feel, however, that if the bookkeeping be continued either for the five years originally intended, or for a further term until the end of the period fixed for the operation of the Braddon section, or for any other period, and we make a sudden change at the end of that fixed term, from the bookkeeping to the other method, there will be great outcries. We have had a wholesome example of what can be done by proceeding gradually, instead of abruptly, in connexion with the Western Australian Special Tariff’. The Tariff has been diminished year by year by one-fifth, and will disappear next year. There has been no great complaint in that connexion. The fears that were at one time expressed, that the finances of Western Australia would suffer, have not been realized,, and it may be that the fact that the receipts have been greater than was anticipated has contributed to that result. In that case we have, bv the use of a sliding scale, largely diminished the objection that would attach to making a sudden change, and it seems to me that we might with advantage adopt a similar principle in connexion with the transition from the bookkeeping system to the more truly Federal system of finance. It is quite true that the circumstances of Western Australia are different in this respect - that the adoption of a system of expenditure upon a population basis would affect that State to its detriment, much more materially than it would any other State. I am inclined to think that the Treasurer did not overlook that fact when he declared that in his opinion the bookkeeping period should be extended for a number of years. In this connexion, I. think- and I “speak not merely from my own impressions, because I have the advantage of knowing the mind of the right honorable member for Balaclava upon the subject, and we all recognise that his opinion is worthy of every consideration - .that we should abolish the bookkeeping period gradually by adopting a sliding scale extending over five years. In view of the special circumstances of Western Australia, I should be quite satisfied - although she is getting advantages in other directions - to allow the sliding scale in her case to extend over a period of ten years. I feel convinced that some such method is the only one which will satisfy the public as a whole in exchanging the bookkeeping system for a -per capita method. We cannot remain upon the bookkeeping basis for ever. So long as that system continues it cannot be said that we are- truly federated. At the same time, we ought to make the change gradually, and, therefore, I suggest that we should adopt a five years’ sliding scale in the case of all the States except Western Australia, with a somewhat longer period in the case of that State. I should now like to say a word or two in reference to what is called the Braddon section of the Constitution. I do not know whether the Treasurer entertains the view, that that section should cease to operate at the period fixed for its expiry by the Constitution. As I have apparently misunderstood his remarks, I shall be glad to know his opinion upon the matter.

Sir John Forrest:

-. - The honorable and learned member will see my view of it by reference to page 12 17 of Hansard.

Mr McCAY:

– The Treasurer stated-

I do not see that much good can result to the States by extending the duration of the Braddon provision. It may restrict the spending powers Of this Parliament, but I cannot imagine that we shall do anything to injure the people of the States. They are our constituents, and to injure them would be to injure ourselves. This Parliament will neither injure nor ignore the people o.r the States-

That sentence means, if it means anything, that he is an advocate for not extending the Braddon section of the Constitution.

Mr Page:

– What else could it mean?

Mr McCAY:

– I do not know. When I said just now that the right honorable gentleman had expressed the opinion that the Braddon section should not be continued, he challenged the accuracy of my statement.

Sir John Forrest:

– I said - as will be seen by reference to the same page - that my judgment led me in the direction of desiring to return to -the States a fixed sum annually, and that, under such conditions, there would be no necessity for a continuance of the Braddon section.

Mr McCAY:

– That would be a most delightful system for the Commonwealth to adopt, but it would not be appreciated by the States Treasurers, because the population of Australia will grow - the Government anticipate that their policy will make it increase by leaps and bounds - whereas the Commonwealth contribution would remain the same.

Sir John Forrest:

– I said that a fixed sum might be returned to the States, subject to periodical adjustments.

Mr McCAY:

– I understood the right honorable gentleman to propose the Canadian practice. We must recollect, however, that when that system was adopted in Canada the revenue from the sources from which we derive ,£7,000,000 annually was something less than £1,000,000. That is a very different state .pf affairs from that which obtains in the Commonwealth. We could make an arrangement in regard to £1,000,000 that we could not make in regard to ,£7,000,000.

Sir John Forrest:

– To this day the Dominion Government returns so much per head to the Canadian provinces.

Mr McCAY:

– The right honorable gentleman wishes to do away with the Braddon section. But I would point out that, whatever authority may spend the public money, be it Commonwealth or State, the same citizens have to pay. That fact should be remembered. I say that the people of Australia rightly regard the Braddon section as a check upon Federal expenditure. Fancy this Parliament with the restriction imposed by that section, or some other equally powerful restriction, removed from our Constitution ! Fancy the saturnalia of Federal expenditure with the Treasurer as high priest ! Even he would forget to be economical under such circumstances.

Sir John Forrest:

– The honorable and learned member will represent me as a very extravagant individual presently.

Mr McCAY:

– The taxpayers of Australia say that there must be some check imposed upon Federal expenditure. If we took over all the transferred departments which have not yet been established - leaving out of consideration our special sources of expenditure, such as the sugar bounty, the iron bonus, old-age pensions, &c. - by being somewhat extravagant we could easily expend very close up to our one-fourth share of the Customs and excise receipts. Even the right honorable gentleman himself might find it comparatively easy to achieve that result. But if anything like the remaining three-quarters of the Customs and excise revenue were available to this. Parliament there would be, a temptation to spend which we might find irresistible. We all know that in the case of Parliaments with large sums at their disposal there is a very great disposition to spend money. The spending decisions of any Legislature are nearly always limited by its spending capacity. A Parliament which, throughout a long period - in the face of pressure brought to bear in favour of expending a little money here and a little there - would virtuously . resist the temptation, and return to the States sums which it is under no obligation to return, is such an anomaly in modern life that we need not seriously contemplate its continued existence. The fact that for some years past the Commonwealth has been doing -this is due to the circumstance that our actions have been scrutinized with great exactitude, and have had bestowed upon them greater attention that has ever before been bestowed upon the actions of any Parliament. Moreover, we were morally bound to return to the States as much as we could, owing to the fact that we had fixed a limit which our expenditure was not to exceed ; and in the early days of the Federation we felt it incumbent upon us to give a sufficient reason for every pound that we proposed to spend. But if we were released from the obligations imposed by the Braddon section, all the big schemes for spending hundreds of thousands of pounds in various directions

Mr Wilks:

– By way of bonuses.

Mr McCAY:

– I believe in bonuses, so that I cannot sympathize with the interjection of the honorable member. I repeat that under such circumstances there would be a temptation to spend money which this Parliament would find irresistible. There must be some check upon our powers of expenditure, and the people of Australia feel that the effect of the Braddon section has been a salutary one. The fact that we have kept within its limits is no reason for doing away with all restriction, so that we can exceed those limits. The taxpayers regard that’ section as one of their best safeguards against unnecessary Federal expenditure. There are legitimate objects upon which we could expend large sums of money if we wished to do so. In this connexion I may instance the question of old-age pensions. Before I vote for that proposal, I wish to see where the money necessary to give effect to it is to come from.

Sir John Forrest:

– I hope that the honorable and learned member does not infer from anything I have said that I wish to return to the States less than has been returned to them. I desire to give them as much as I can.

Mr McCAY:

– The right honorable gentleman means that he wishes to give them as much as he can spare, which is an utterly different thing.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Does not the honorable and learned’ member think that in regard to the iron bonus - apart from the merits of the question altogether - we might inquire where the money with which to pay it is to come from?

Mr McCAY:

– The Commonwealth will be in a position to pay that bonus out of its’ one-fourth of the Customs and Excise revenue. ‘We will not be required to spend; £300,000 in one year. The Treasurer has said that in regard to the transferred Departments we ought to adopt the’ system of crediting and debiting balances. At first sight it seems to be common sense that we should merely account for differences, instead of crediting and debiting the whole amount. There is no objection to that from a bookkeeping stand-point, nor is there from the stand-point of the taxpayers, if we did not expend more than we are entitled to. But if we are merely to credit and debit balances, it is only the interest on the balances which will have to be appropriated out of the one-fourth of the Customs and Excise revenue to which the Commonwealth is entitled. On the other hand, if we credited arid debited the totals, the matter would assume a very different complexion.

Sir John Forrest:

– The honorable and learned member would not impoverish the Commonwealth ?

Mr McCAY:

– I do not wish the Commonwealth to have to look around for ways in which to spend money. I do not desire it to have so much money to expend that it will require to look round for a means of investment. If we merely credit and debit balances in connexion with transferred properties - the States debts remaining with the States, as they appear likely to do for some time - we shall have those properties vested in a new trustee - the Commonwealth. They’ will still remain the property of the taxpayers; but we. shall have the States continuing to bear the interest upon the debts out of which those public properties were erected or acquired, out of their threefourths of the net Customs and Excise revenue, and the Commonwealth out of its one-fourth share of that revenue will be called upon to bear only the expense of the debited and credited balances. That position would affect the States finances. The States would nominally receive back their three-fourths of the Customs and Excise receipts ; but they would really be refunded the three-fourths of that revenue less these charges. Frankly, from the point of view of a member of this Parliament, and looking at the Commonwealth capacity and powers, I say that if I considered it fair to leave the interest charges with the States, and to debit and credit only the balances, it would be much more satisfactory to one’s own feeling to adopt that course. But it would not be justice.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Whichever method we adopt, the interest upon the transferred properties ought to come into our balancesheet.

Mr McCAY:

– The interest upon the balances would do so.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– But we are tight up against our limit now.

Mr McCAY:

– I think that the transferred properties are worth about £10, 000, 000, and that the balances represent about £1,000,000. Consequently, if we debit and credit balances only we shall have to pay out of our one-fourth of the Customs and Excise revenue interest upon £1,000,000; whereas, if we debit and credit totals, we shall have to pay interest upon £10,000,000. Which is the fairer method to adopt, seeing that the States retain the debts, and the liability to pay the interest upon the loans, which have, to a large extent, been used in creating the assets that we have taken over ?

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– If we use those properties, the interest upon them ought to come into our accounts.

Mr McCAY:

– I think so. It was the economical instinct of the Treasurer which prompted him to make the suggestion that he did.

Sir John Forrest:

– This House has to settle the matter.

Mr McCAY:

– But the Treasurer is trie leader of the House in regard to financial matters, and I wish to know where he is leading us.

Sir John Forrest:

– The honorable and learned member agrees with what I desire to do.

Mr McCAY:

– I do not.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The right honorable gentleman is leading us right into the Ministerial corner.

Mr McCAY:

– He certainly is not doing so, although he has gone there himself, leaving two or three of us behind. I cannot speak for some of my honorable friends on the direct Opposition benches; but the right honorable gentleman left the honorable member for Gippsland and one or two others behind as unnecessary encumbrances when he took the little journey to which I have referred.

Sir John Forrest:

-The honorable member has changed his seat in the House.

Mr McCAY:

– People usually do when they get kicked out of their seats. I left my seat on the Government side to make room for the right honorable gentleman.

Mr Page:

– Whom did the honorable and learned member kick out in order to get possession of the Government benches ?

Mr McCAY:

– I was sitting in direct opposition at the time of the overthrow of the Watson Government. There is only one other matter relating to the financial side of the Budget to which I desire to refer, and that is the question of the continuation of the sugar bounty. The bounty has undoubtedly done a great deal in the direction in which it was hoped that it would produce results. Four or five years ago the quantity of white-grown sugar produced in Australia was only one-fifth of that grown by black labour ; but the estimate for the coming year is that white-grown sugar will constitute one-half of the total production.

Mr Mahon:

– Has not the quantity of black-grown sugar also increased?

Mr McCAY:

– That is so; but I am speaking of the proportion of white-grown sugar to black-grown sugar. Three or four years ago the output of black-grown sugar was about five times as great as that grown by white labour.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The point is, that the quantity of white-grown sugar is increasing, while black-grown sugar isnot decreasing.

Mr McCAY:

– We have to remember that the estimate for the coming year is that the production of black-grown sugar will be only twice as great as that of the white-grown article. Previously, about 16 per cent. of the total production was white- grown, but now we have something like 33 per cent. of our sugar grown by white labour. The percentage shows an increase in favour of the white-grown article.

Sir JOHN FORREST:
SWAN, WESTERN AUSTRALIA · PROT; WAP from 1906; LP from 1910; NAT from 1917

– The estimate is about 40 per cent.

Mr McCAY:

– I am merely using approximate figures. We are now asked to renew the bounty. I am a protectionist, and I supported the granting of the bounty on protectionist principles, as well as on the ground that it would assist to secure a White Australia. There were other honorable members who, although free-traders, supported the proposal, because they believed that we ought to have a White Australia, and recognised that if we desired to bring about that result, we must be prepared to pay something for it. So far as one is able to judge from the facts, the bounty cannot be suddenly terminated, as now provided, on 1st January, 1907. Speaking as a Victorian,I say that there is no State in the Union which suffers more pecuniary disadvantage from the Commonwealth system of dealing with the sugar industry than does Victoria. Before Federation, Victoria had a revenue duty of £5 15s a ton on sugar, and there was only a margin of 5s. per . ton allowed by way of protection to the local refiner. Practically the Victorian duty on sugar was a revenue one. By losing a very considerable proportion of the revenue that she derived from that source, Victoria has been a financial sufferer, and has not received any corresponding direct financial gain. Still, she has no right to complain of that.

Mr Page:

– As the result of the present system, have not many Brisbane factories been closed ?

Mr McCAY:

– I have just said that Victoria has no right to complain, because the sugar bounty is part of the protectionist policy of Australia, of which policy Victoria provides a considerable number of advocates; and it may be that she obtains indirectly some benefit from the system of refining now being carried on otherwise than it would have been. Nevertheless, as a matter of pounds, shillings, and pence - as a matter affecting the public revenue - it cannot be denied that Victoria is paying fairly heavily in this direction.

Mr.McWilliams.- And the fruitgrowers of Victoria are paying fairly heavily for the system.

Mr McCAY:

– That is so. I am acquainted with a number of fruit-growers who live near me, and they may also be. affected to some extent by the present system It is clear, however, from the figures that have been quoted by the Treasurer, that the quantity of black-grown sugar is still far ahead of the white-grown article, and that if we suddenly terminates’ the bounty, much injury would be done to the Queensland sugar-growers. We should extend the bounty. I do not recollect whether the Treasurer mentioned the extension proposed by the Government.

Sir John Forrest:

– An extension of five years.

Mr McCAY:

– Human nature is human nature all the world over. That is so even of protectionist human nature, which is the purest form of which I know. If we extended the bounty as it stands for five years, it would be justly said at the end of that period, “ The’;<Parliament must not suddenly abolish it.” It seems to me that we must once more resort to the device of the sliding scale - a device which has always proved successful in connexion with the introduction of changes. I notice that the honorable member for South Sydney suggested yesterday that the bounty should be extended on a sliding scale, and I think I am able also to say that the right honorable member for Balaclava holds the same view. If we extend the bounty - not necessarily for five years ; I should be prepared to extend it for a further period, if that were essential - we must provide for its payment on a sliding scale, so that it will disappear automatically, instead of merely by the effluxion of time, or by the passing of an Act of Parliament. When a measure of that kind becomes necessary, the pressure that is brought to bear and the good case that can be made out for an extension make it exceedingly difficult to ‘say “No.” I again urge upon the Government that they should consider the advisableness “of bringing, not only the book-keeping period, but the system of granting the sugar bounty, to a termination by means of a sliding scale. If it be desired to continue the bounty for another year or two at the present rate, because the growers have been led to« justly hope for such an extension, let us enact that for two years it shall continue at the present rate, but shall then disappear by a sliding scale extending over five, or even seven years. If the bounty be diminished year by year, the force of the blow will not be felt, by any one as it would be if the whole system were suddenly abolished, f commend this suggestion to the serious con’sideration of the Government, believing that it will provide the most satisfactory solution of the difficulty. I desire now to say a few words on the question of the defence vote and our defence policy. As honorable members know, this is a subject in which I have taken a deep interest for a long time, and to which I have devoted as much attention as I could possibly give to it. I am very sorry to see that the Estimates for the current year, as submitted, are less - although it is only by a thousand or two - than were the Estimates for the last financial year.

Sir John Forrest:

– No alteration has been made in the Estimates as left by the honorable and learned member on retiring from office.

Mr McCAY:

– There is a considerable reduction.

Sir John Forrest:

– Only by way of economies.

Mr McCAY:

– Perhaps the right honorable gentleman does not know how the reduction has been effected.

Sir John Forrest:

– I shall be glad to know of anything of which the honorable and learned member may be pleased to inform me.

Mr.- McCAY.- The right honorable gentleman knows a great deal, but he does not very often favour the House with all that, he learns.

Sir John Forrest:

– I have already said that I shall be glad to hear what the honorable and learned member has to tell me on this point.

Mr McCAY:

– I shall tell the right honorable gentleman how the reduction in the Estimates, as I left them, compared with’ those now before us, has been arrived at. It has been achieved by two simple processes. There has been no alteration so far as I can see in a single proposed appropriation for stores, or in respect of one man in the force. The Defence Estimates, as I prepared them, made provision for 1,500 men more than were provided for in the Estimates of the previous year, at an increased cost of something like £6,000. This was possible only by the economies to which the right honorable gentleman has referred - by scrutinizing every item, from beginning to end, of the Defence Estimates, which is no light task, and by cutting offeven a £5 note where that saving could be effected. I personally went through every item in the Estimates of my Department, and the proposal for an increase of 1,500, to a large extent in the forces of Tasmania, was the result of an arrangement which I thought would be satisfactory to that State, after the difficulty of a year or two ago. But the Government, while professing to make this increase in the strength of the forces without increasing the Defence Estimates, have really effected the so-called economies by saying that the increase shall not take place “ until 1st January, 1906.”

Sir John Forrest:

– Does the honorable and learned member sav that we have done that ?

Mr McCAY:

– Tha incoming Government did that.

Mr Mcwilliams:

– And upset all the arrangements which had involved so much trouble.

Mr McCAY:

– That is so; the Government proposal really means that, instead of having these men on 1st January, 1906, we shall not obtain them until about 1st May, 1906. It will upset all the arrangements made in Tasmania, in respect of which there was special reason for fair consideration. The other means by which a saving has been effected, so far as I can make out, is this-

Sir John Forrest:

– How much will be saved in this way ?

Mr McCAY:

– When we are dealing with the Defence Estimates, I shall refer to that point.

Mr Wilks:

– Would the honorable and learned member speak of this as “ financial dodgery “ ?

Mr McCAY:

– I should not.

Sir John Forrest:

– Does this saving apply only to Tasmania?

Mr McCAY:

– To all the States. Wherever a proposed increase appears on the Estimates, we see a foot-note setting forth that it is to date from 1st January, 1906.

Sir John Forrest:

– Some weeks of the current financial year have already passed, and it seems that the Estimates will not. have been finally dealt with much before January next.

Mr McCAY:

– Then the right honorable gentleman will be able to do this year what the Defence Department did last year. In the month of February I had a chat with my colleague, the right honorable member for Balaclava, who was ‘then Treasurer; and we came to the conclusion that we could save £45,000 on the Defence expenditure. Having arrived at that decision, we promptly appropriated the £45,000 to make good arrears in the purchase of special warlike stores. But until these Estimates are at any rate authorized, the Department will not be able to move hand or foot in the direction of securing more men before 1st January next.

Sir John Forrest:

– In any event, we shall not have much time to get ready before that date.

Mr McCAY:

– It takes time to get recruits ready for the ranks. But the Governments could tell the State Commandants to make their arrangements now.

Sir John Forrest:

– We shall be able to get them ready by the 1st January.

Mr McCAY:

– When we begin to drill recruits for a partially-paid force, we must make arrangements to pay them in respect of drills.

Sir John Forrest:

– We shall be able to make a start on the 1st January.

Mr McCAY:

– I hold that the economy which the Government propose will be economy at the expense of the efficiency of the Australian forces.

Sir John Forrest:

– How could the late Government have paid these men from1st July, when the Estimates would not have been passed until some months later?

Mr McCAY:

– The increases would have dated from 1st July. Had there been no want df confidence motion moved against the late Government, I should have chanced the Estimates being passed, and-, as soon as the Budget had been brought in and discussed, would have ordered the Commandants to go ahead and enlist these additional men.

Mr Kennedy:

– Where would the responsibility of Parliament have come in?

Mr McCAY:

-Once the debate on the Budget has been concluded, there is considered to have been a general approval of the Estimates as a whole.

Mr Kennedy:

– Not necessarily.

Mr McCAY:

– I think one might very well suppose that that is so, in connexion with proposals for the raising of troops.

Mr Kennedy:

– We are now in the middle of the first half-year, and the Budget hasnot yet been approved.

Mr McCAY:

– I take it that, in spite of some of the long speeches that have been delivered, it will be approved before the 1st January next.

Mr Kennedy:

– It is suggested by the honorable and learned member that the Minister should commit the Commonwealth to certain expenditure, and then ask Parliament to ratify it.

Mr Storrer:

– There is apparently a desire to ruin the forces in Tasmania.

Mr McCAY:

– I can assure the honorable member that if the Estimates were passed as framed by me, they would go a long way to allay any cause of discontent in Tasmania. I make that statement with a full knowledge of the facts gained as the result of a visit thai I paid to, the State, and from personally meeting men of all ranks in the local forces. The other way in which the reduction has been made is this : Wherever an amount is set down for pay for attendance at drills, the estimated saving that will be occasioned by men not attending the drills which they must attend to entitle them to payment, is deducted, and, so far as I can ascertain, these estimated! savings have been increased.

Sir John Forrest:

– Very likely. I reduced the Estimates a little.

Mr McCAY:

– If the estimated savings have been increased, they have been unwisely increased, because the amount had already been reduced to the lowest margin proper.

Sir John Forrest:

– It was done by the Department.

Mr McCAY:

– Then it must have been done on pressure by the Treasurer.

Sir John Forrest:

– The reduction was desired by me.

Mr McCAY:

– It is desirable that the total estimate for the Defence expenditure should not much exceed the total actually expended during the year, because otherwise the calculations of the States Treasurers are thrown out.

Sir John Forrest:

– The honorable member’s present remarks do not suggest great extravagance on my part; they rather point to economy.

Mr McCAY:

– I have already explained that the Treasurer found these Estimates practically ready to his hand.

Sir John Forrest:

– But I have reduced them rather.

Mr McCAY:

– The right honorable gentleman has merely cut down necessary expenditure here and there beyond the limit of safety. We, on this side, can forego a reputation for economy of that kind. We do not desire that such economy shall be credited to us.

Sir John Forrest:

– At any rate, I am glad to hear that we have not increased the Estimates of the late Government.

Mr McCAY:

– I had to reduce the Defence Estimates very much below what I would have left them at, if I could have had my own way ; but that is the misfortune of every Defence Minister.

Mr Mcwilliams:

– Will these Estimates upset the arrangement made by the honorable and learned member?

Mr McCAY:

– Only until the 1st January. They will postpone it. By the time everything was in working order, the Estimates would have been pretty nearlythrough Committee; but this prevents the arrangement from being begun.

Sir John Forrest:

– I do not think so.

Mr McCAY:

– I can assure the right honorable gentleman, from the practical knowledge of the working of the Department which I possess, that it does.

Sir John Forrest:

– I disagree with the honorable and learned member.

Mr McCAY:

– That isa misfortune which I shall bear with such philosophy as I possess. I do not wish to discuss the details of the Defence Estimates to-day, but I desire to say a few words about what, in my opinion, the defence policy of Australia should be; to give reasons why a certain policy should be followed ; and to show how far Australia is carrying out that policy. I have no quarrel at all with those who urge that our main defence should be on the sea. I agree entirely that our real defence against the permanent occupation of our country by any enemy is the fact that we are a part of the British Empire, and are protected by the British Navy. If by some misfortune we became separated from the British Empire to-morrow, we should be the helpless prey of any of the great powers, supposing that we had no one to come to our assistance. That is certain and definite. Our securfty depends on the existence and central control of the Imperial Navy, and upon the fact that, with central control, the Imperial Navy can be moved as a whole, or in parts, to the points of danger, where its naval supremacy may be threatened. So long as its naval supremacy can be challenged, the challenge can be met only by that single control. The efforts of an Australian Navy, unless it were equal in strength to the navies of at least the second-rate naval powers of the world, would be no substantial protection to the Commonwealth, apart from the navy of the Empire. We in Australia, as a portion of the Empire, are bound to recognise our obligations to it in connexion with naval defence. We do so aif the present time by a contribution of some £200,000 per annum. Had we plenty of money, that would not be a contribution proportionate to the benefits we receive ; but it is a contribution roughly proportionate to our capacity to pay. There are other methods of expenditure, which are more urgent, not only from the Australian, but also from, the Imperial, point of view, to which we should therefore resort before increasing our Imperial contribution, always remembering that we are not paying our fair share. Australia, although in one sense a source of weakness because’ of her remoteness from the centre of the Empire, may be made a considerable source of strength to the Empire. We are set here in the South Pacific, and the events of the recent RussoJapanese war - I am sure that every one is glad to be able now to speak of it as recent - have shown that storm centres may arise in the Pacific just as they may arise in the Atlantic or in the North Sea. I am not going to discuss where the great war is to take place. There are different schools of thought on the subject; but it is clear, from what we have seen recently, and from the fact that foreign nations have acquired, and are acquiring, naval bases and fortified coaling, stations in the southern seas, that Australia is no longer remote from the theatre of the world’s wars, as we were half-a-century, or even a shorter period of time, ago. The increased rapidity of communication between distant countries which has come about by the use of fast steam vessels, has decreased our distance from the world’s centres ; but, in addition to that, as you, Mr. Chairman, pointed out recently in another debate, when we look at the map of the South Pacific, and see that we are within striking distance of the naval stations of various foreign powers, we must realize that Australia is no longer that outlying and, consequently, protected portion of the world that it once was. Our duty to the Empire is, in some respects, what the duty of the outpost of an army is, and demands that we should mate these advanced positions safe. We should be able to say to the mother land, “ On the high seas you must continue to be our defence for a considerable time to come, as you have been in the past, though our financial circumstances do not permit us to pay you in proportion to the benefits which we receive, nor do we think it strategically wise to substitute for the Imperial’ Navy an Australian sea-going navy under independent command. Still, so far as our shores are concerned, we are ready to protect our centres of commercial life.” In Australia these commercial centres are practically all on the sea coast, and, so far as commerce is concerned, the country is one huge littoral, having practically 110 interior, because almost the whole of its trade is carried on close to the coast. We should be able to say to the Empire, “ We will protect ourselves, so far as our commercial interests are con-v cerned” - and these are Australian chiefly, and only indirectly Imperial interests - “ and will provide what the Imperial and any other navy requires, secure naval bases to which it can resort whenever occasion demands.” No fleet is of any use, be it the greatest fleet in the world, unless it can found its operations on secure bases. If there is one lesson which recent naval wars have taught - the Spanish-American war and the just-ended Russo-Japanese war - ‘ it is that ‘fleets cannot operate unless they know that they have behind them bases to which they can retreat, and where they will be secure.’ We, in Australia, can make our naval bases secure. But we have not done so yet. So far as any blame is attachable to me for inaction in this matter during the short time I was in office, I am prepared to accept it. But we can do what I speak of. If any struggle, in which the Empire was engaged, was so great that British naval supremacy was seriously, threatened, the Australian Navy which every penny of the Commonwealth revenue could raise” and support, would not count very largely. It is only in the case of British naval supremacy being seriously threatened that our coasts would be likely to be denuded for a time of Imperial protection. That is a fact which we must always bear in mind, putting on one side a matter to which’ I shall now allude - the occasional raids that may be expected from escaping cruisers of the enemy. In the event of the whole of the British fleet being drawn away for a time to meet some great crisis, we must arrange to meet the possibility of an enemy’s cruisers coming along our shores and raiding our towns. But if the crisis is so great that the whole of the British fleet must be called away, to meet it, I am inclined to think that the whole of the enemy’s fleet will also be called away.

Mr Hutchison:

– An enemy’s vessels could not get enough coal to enable them to come here.

Mr McCAY:

– - Foreign powers are acquiring coaling ports in the South Pacific, and I can quite conceive of circumstances under which Australia’s best defence would be to convey in transports our land forces, and make descents upon certain harbors in the South Pacific, which occur to all, and which I need not mention now. Such circumstances would provide an occasion on which Australian troops might well operate beyond Australia, not for Imperial defence, but for purely Australian defence, and such occasions must be borne in mind. That is one of the reasons, though there are many others, why we must have what is called a field force in Australia. But I do not wish to anticipate. We must provide not only for the security of our naval bases, and for the protection of our centres of commercial life, but also for the security of coaling ports for trading ships, and ships of war. We must provide secure harbors of refuge for the shipping that may have temporarily to shelter there. All these things not only can, but should be done by Australia, so that she may do her share in Imperial defence. I press this point because sometimes at the other side of the world, in the old country, and even on )his side of the water, there are those who suggest that we s’hould do away with all these means of defence, and rely solely on the Imperial Navy. That is a mistake. To develop Australia as a part of the Empire, the public must have reasonable security, a reasonable belief that they are reasonably safe against attacks that may be reasonably apprehended. That is a duty which we can perform. What kind of attacks, I ask, are we likely to have to meet? As I have already said, invasion by a large army for the purpose of permanently occupying Australia I put aside, not as beyond the bounds of our possibility to conceive, but as beyond the bounds of our possibility to meet, apart from Imperial protection. Although we could give an enemy a prettylively time before he finally subdued Australia, he could take possession of our coastal settlements and could smash us up so far as our development was concerned. Still, I do not think anything of that kind is likely to occur ; although cur sole dependence against any such contingency is our Imperial connexion. Then we may have raids in greater or less strength, flying raids by sea attack only, or, what I venture to think is much more likely, flying raids by sea, accompanied by small land attacks. History has shown that in no cases have bombardments been anything to bother about; at any rate, not the short bombardments that an enemy’s cruisers could indulge in on Australian shores, because they could not afford to throw away their ammunition. But, further than that, the best provision we could have against the bombardment of most of our Australian ports would be good fire brigades. I would sooner have a series of good fire brigades than a strong military force at the time of a bombardment. I have noticed that fears have been expressed that an” enemy’s cruisers might lie off, say, Manly, and bombard the city of Sydney ; but, if I may be permitted to do so, I would advise the residents of Sydney not to sleep any the less soundly on account of that fear. All the damage that an enemy is likely to succeed in doing could be cheeked by the exertions of an efficient fire brigade, and very little compensation would have to be paid for chance loss incurred by the owners of private property. A bombardment by a hostile cruiser would not result in any harm worth speaking of. History tells us also that combined attacks on fortified ports by sea and land - by the front door and the back door- are the only effective operations. The honorable member for Wentworth expressed a fear lest an enemy’s cruisers might come along carrying torpedo boats, with the idea of making a raid at night by the means of the smaller vessels. He argued, therefore, that our fixed defences should be placed in a satisfactory state. I would go further than he does, and say that our harbor defences ought to be made satisfactory, and that at some of our harbors fixed defences alone are not sufficient. In Port Phillip, for instance, we must have some floating defences in addition to fixed defences. I do not suggest that the Cerberus should be re-armed, although ,£2,000 has been placed on the Estimates for that purpose. That sum Was included in the Estimates before I had left office pending certain investigation. Before I left office, I wrote a minute, stating that the investigation referred to had proved that the money should not be spent in that direction, but in some other manner.

Mr.- Page. - Would the honorable and learned member vote against that appropriation being made?

Mr McCAY:

– Certainly. In the event of no other honorable member taking action, I shall move that the item be struck out. We must have our land defences, in which I include movable land forces, whether, they be called field or garrison forces, as well as our fixed defences. Movable land forces would comprise infantry, mounted troops, field artillery, and various other corps, such as engineers, transport corps, army service corps, and so on. Fixed defences consist df big guns, and of quick-firing guns, the latter being required to meet torpedo attacks,, twelve-pounders being recognised as the proper class of guns to use for the purpose. The fixed defences would also include something that we have not yet properly provided, namely, a proper electric light equipment, including movable search-lights and fixed beams. All these things will have to be done before we shall have fulfilled that elementary duty to the Empire and to ourselves of which I spoke at an earlier stage. MajorGeneral Hutton when he was here two or three years ago propounded a scheme for the constitution of the best force for the purpose of defending the Commonwealth. I shall speak in round figures, because: I do not wish, to bother honorable members with details. He proposed that the land forces should- have a peace strength of 26,000 men, and a war strength of 40,000. The 40,000 men were to be used as garrison troops and field forces. A number of criticisms have been directed against field forces on the ground that they are intended to be used to take part in Imperial wars elsewhere. That is an entirely new idea, and nothing of the kind is contemplated. In 1894, the States Commandants, in conference, recommended that garrison and field forces should be maintained. As a matter of. fact, we have always had them, although they have not been so called. In 1901, the Commandants recommended the maintenance of field and garrison forces, and the Colonial Defence Committee has approved of the division into garrison and field forces. Although the Committee has been attacked by many persons, its opinion is worth a good deal. When he came here in 1902, Major-General Hutton advocated that we should have field and garrison forces, adopting a view that had been already approved assound. I think that all those who. expressed ‘this view w.ere right, and I believe I know the reasons that actuated, them. Although the States of Australia, are united in the Commonwealth, and although one of the avowed objects for which we were united was to perfect our defences, the fact of our political union does not alter the strategical considerations that have to be taken into account when arranging for the defence of Australia. We have an extensive coastline, our great cities are situated on the coast, and our population is small. Our great cities are situated at a considerable distance from each of her, and as any attack that we may reasonably apprehend will be sudden but not lasting in its character, we must maintain as near to the possible points of attack - leaving out of consideration many minor places that will have to take their chances without having any provision made for their defence-

Mr Carpenter:

– We shall need the transcontinental railway to enable us to do that.

Mr McCAY:

– That will affect only in degree and not in kind the point to which I am referring. We shall have to maintain comparatively near to our most vulnerable points forces sufficient, at. any rate, to repel a first attack,. After that we may rely upon reinforcements being despatched as the enemy’s attack is developed. An enemy can choose his own point of attack. We cannot know at what point he will approach us until he has actually arrived there. Then when he develops his attack reinforcements will be sent to the aid of the forces stationed at that particular spot. That is why we must maintain near to our main ports, our harbors, our coaling stations, and our commercial centres forces of garrison troops, and also forces of greater nobility wwhich cnn. be moved readily from spot to spot, and which may be fairly called field forces. It does not matter what name is applied to these forces. We may call them the first and second lines of defence, the A and B forces, or we may use the terms, employed in the wargame, of red troops and blue troops. But by: whatever names the forces mav be known, it is imperative that we should have the garrison forces in the immediate neighbourhood of our most vulnerable points, and also movable forces which can be transferred from point to point as occasion may require. That is why we need a much larger force than, in one sense, our population, would seem to demand. Some people say 40,000 soldiers, consisting of horse, foot, and artillery, would be more than sufficient to deal with any force they would be called upon to encounter. I entirely agree that we are not likely to have to meet 40,000 or even the half of that number of an enemy ; but it is because the enemy can attack us at whatever point he may choose, and because we shall have to meet him in equal or superior force at whatever point he may land that we require a comparatively large number of men. We are compelled, for strategical reasons, to maintain that force. Now, I wish to speak of that other branch of our defences to which the honorable member for Wentworth chiefly devoted his attention, namely, our fixed defences. Upon that subject the honorable member speaks with a great deal of weight, because I confess that I have always felt that if I could meet his criticisms I should be able to go a long way in the right direction. The honorable member makes speeches upon our defences that are entitled to consideration by any honorable member who is interested in the subject. It is quite true, as was mentioned by the honorable member for Darwin, that armaments are continually changing; but the honorable member drew from that fact the novel conclusion that we should not have any armament. With that view I do not agree. He wishes us to wait until we reach the final result of the development of modern weapons before we proceed to arm our forts. I can assure the honorable member that when that time arrives he will have no further interest in weapons of any kind. Armaments are continually changing. Since th:S Commonwealth came into existence the whole idea - in the Navy at any rate - with regard to the calibre of big guns has changed. The 6-inch gun was a few years ago the main weapon used in. naval .armament, and was also the chief gun of position. That idea has now been entirely changed, and the naval authorities are beginning to regard 6-inch guns as already belonging to the past. The armaments of our forts at present consist mainly of 6-inch guns.

Sir John Forrest:

– Those are the guns to be mounted at Fremantle.

Mr McCAY:

– There are to be two 7-5 guns and two 6-inch guns. It is perfectly right that we should have 6-inch guns in addition to others, and there is. a very good reason why 6-inch guns should be placed in position at Arthur’s Head, instead of 7”5 guns, because the fort is not big enough for weapons of the larger calibre. It is well understood that there must be a certain distance between the guns, and that the larger the guns the greater the space required. Ideas with regard to armament are continually changing, and if we were to keep on re-arming our Australian forts as developments occurred, to keep them up to date, probably reaching the stage at which we should require to purchase 12 -inch guns, we should have to spend about £200,000 per annum upon big guns alone. We cannot possibly afford to do that, and, moreover, it is not necessary for the reason that our Australian forts are less likely than are the forts in’ any other part of the Empire to have to engage in long encounters with a hostile squadron. Any engagements will probably be short and sharp, whether they, prove decisive or otherwise.

Mr Page:

– Surely the honorable and learned member does not mean that we should not have the best armaments.

Mr McCAY:

– Certainly not; but I contend that we cannot afford to spend, all our money upon armaments for our forts to the neglect of other necessities. We must keep on re-arming our forts all round our coasts as- opportunity offers. For instance, supposing we start at Fremantle, we shall eventually reach Sydney, and by the time we hae finished at Sydney we shall probably have to recommence at’ Fremantle. That is exactly what is being done. Fremantle is being armed with reasonably good guns, and the fort there will be, for its size, the best equipped in Australia. It is being armed with mark 7 6-inch guns, and the very best and latest mark of 7 “5 gun. My intention was that we should pass by Adelaide because it is an open question how far forts in St. Vincent’s Gulf are of any value. At any rate, 6-inch guns will do there, whilst they have only 6-inch guns in several other forts. The port that most requires an improvement in its defences is Melbourne, and after that has been attended to Sydney should be re-armed with bigger guns. We have one necessity at all our forts, namely, that the quick-firing armament against torpedo attack should be improved, and it is the duty of the Government to consider whether the necessary weapons should not be included in their purchase of special war-like stores. Major-General Hutton proposed to expend £525,000 in order to place the equipment of our forts upon a war footing. We thought at the time that that amount would cover everything. I wish that it would. Apart from anything mentioned in Major-General Hutton’s scheme, I have a little list here, comprising items which involve an expenditure of £800,000.

Sir John Forrest:

– Upon whose recommendation is that estimate based ?

Mr McCAY:

– I take the responsibility for these figures.

Sir John Forrest:

– They are not founded upon the opinions of any expert?

Mr McCAY:

– Oh, yes ; there are expert opinions behind them. But I am putting these figures forward as my own opinions at the present time. Major-General Hutton’s scheme involved an expenditure of £525,000. In 1903-4, £97,000 was spent under that scheme; in 1904-5, £.138,000; and for 1905-6, it is proposed to expend £154,000. But in 1904-5, in addition to the items appearing in Major-General Hutton’s scheme, £36,000 was expended upon things which were absolutely necessary, including £22,000 for material for small arms ammunition. Upon assuming office as Minister of Defence, I found that whilst we had a satisfactory reserve of small arm’s ammunition, and whilst, over a given period, we provided cordite for making good the ordinary consumption, we did not provide the shells in which to put the cordite, the caps to fire it, and the bullets. We therefore spent £22,000 upon those materials. We also expended £2,000 upon ammunition for the gun mounted at Hobart. Major-General Hutton’s scheme did not. include ammunition for all the field artillery, and a further sum of £7,000 was spent in that direction. Then there was an item of £5,000 for naval expenditure.

Mr Hutchison:

– Major-General Hutton does not seem to have been too capable.

Mr McCAY:

– He did not include everything in his scheme ; but it is only just to him to say that from a perusal of his reports one can discover what is wanted. He was a very capable man, and rendered great service to the Commonwealth. In spite of any differences that we may have had with him, there is no doubt that he started our defence system upon sound lines in many respects.

Mr Mcwilliams:

– He required just a little more tact. “

Mr McCAY:

– I am not going to say anything derogatory to him. In 1905-6, it is proposed to expend upon matters which are not included in Major-General Hutton’s scheme the sum of £27,000 ; most of it upon the two 7.5 guns at Fremantle, and the balance upon naval items. Honorable members will see that apart from the £525,000 involved in the late Commandant’s scheme, there was spent last year, and is included in these Estimates, a further sum of £63,000. In one of his reports Major-General Hutton pointed out that no provision had been made for the ammunition supply column, which will cost £40,000. That column is absolutely essential to any force which may take the field. Then there is a certain quantity of big-gun ammunition required which will cost £70,000. We also need storage accommodation for the stores which we are purchasing, and this will entail a further outlay of not less than £40,000. All these matters were pointed out by the late General Officer Commanding. Then if our forces take the field, we shall have to provide them with blankets and clothing, which will cost £250,000. That expenditure, however, can be deferred until the emergency arises. Then we must recollect that our big guns in fixed defences are not placed there for all time. They must be replaced from time to time with more modern weapons, just as a rifle needs to be replaced. Then we want a number of other things, such as torpedo-boats in Port Phillip, booms, &c. Our electric light equipment will cost £13,000 or £14,000. We wish to retain our submarine mines till we have secured efficient substitutes for them in the shape of booms and torpedo-boats which are thoroughly equipped. Inthis connexion I may mention that the British Admiralty intends to abandon the use of submarine mines, but not until it has replaced them by torpedoboats and booms. In order to re-arm the whole of our force with modern guns, we shall require to incur an expenditure of anything from £300,000 to £500,000, according to the extent to which we go. So that before we put Australia in the position of being able to discharge her duty to herself and the Empire - apart from the protection which is afforded by the Imperial Navy - we must spend some hundreds of thousands of pounds.

Mr Webster:

– At what does the honorable and learned member estimate the total expenditure ?

Mr McCAY:

– Leaving out of consideration the £250,000 for blankets and clothing, we should require to spend at least £600,000. Then, again, we need artillery ranges. Our field artillery will never be what it might be, with the men we have at our command, until we secure proper artillery ranges - ranges which extend, not over a couple of thousand’ yards, and upon which target practice may be had, but ranges over which (the artillerymen can manoeuvre. Artillery manoeuvring is just as essential nowadays as is artillery firing practice, and we measure artillery ranges, not by acres, but by square miles.

Mr Watson:

– In New South Wales recently the National Park was used for that purpose.

Sir John Forrest:

– At- the end of the current year we shall have spent a large sum upon special armament.

Mr McCAY:

– The £600,000 to which I have referred is exclusive of the expenditure outlined in the whole of Major-General Hutton’s scheme. If we spent every penny that is provided upon the current year’s Estimates, an expenditure of £136,000 would still be required to complete that scheme.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– If that amount were expended, would the items be non-recurring ones?

Mr McCAY:

– Not altogether. Some of those items will be continually recurring.

Sir John Forrest:

– We are getting what we require gradually.

Mr McCAY:

– I am not proposing that we should expend the whole of the money in one year and out of revenue. Of course, I recognise that any Minister assuming charge of the Defence Department at the time of the year that Senator Playford took office, must accept the Estimates of his predecessor. Consequently, if any blame is to be attached to the Defence Estimates, it is attachable to me, and not to my successor, because they are my Estimates rather than his. When I joined the Reid-McLean Administration, I was faced with the position that Major-General Hutton’s scheme was only half completed. As against that fact. there was an urgent necessity - it was a choice of evils, because we had not the money necessary to accomplish everything - for the instalment of the twelve-pounder quick-firing guns and the electric light at our forts, To effect these installations at all our forts would have cost about £70,000. We could not undertake that work at Sydney or Melbourne without doing similar work at Fremantle and Brisbane.

Mr Webster:

– The honorable and learned member means that it could not all be done at once.

Mr McCAY:

– It would require an expenditure of £70,000 to equip our forts with electric light and quick-firers.

Mr Webster:

– Why cannot we undertake ‘that work?

Mr McCAY:

– Simply because we cannot buy 30s. worth of material for £1.

Mr Webster:

– The honorable and learned member has stated that we could not undertake work at one place without carrying out similar work at others.

Mr McCAY:

– It is not impossible, but it is not desirable to do so. Further, we need to order guns in considerable numbers, because it takes as long to get two delivered as it does to obtain delivery of twenty, and a long period is usually occupied in securing their delivery. I repeat that when I assumed office the position in regard to Major-General Hutton’s scheme was that nothing had been completed by the votes of 1903-4 and 1904-5. The votes proposed .for the current year will, to a large extent, complete that scheme. For instance, the vote for accoutrements will complete the accoutrements for the field force upon a war establishment; that for saddles will complete the equipment of the light-horse upon a peace establishment; the vote for the field artillery will bring us within twelve of our total number of guns, and will complete the equipment of sixty out of seventy-two guns. In the same way, the vote for camp equipment will complete the equipment of the garrison force ; and that for medical equipment will complete the equipment of the field force upon a peace establishment. Every one of these votes will practically complete some work which was “already in progress. Now, if modern wars h’ave taught anything, it is that it is not the largest army, or that imbued with the greatest patriotism, which wins, but the army which contains the best leaders, and which is the best equipped in time of peace. Finding the equipment of our forces nowhere complete, I felt that it was mv business to get these things rounded off during the present year. I believe that we shall be far more likely to accomplish good in that way than by adopting any other method. That is why I preferred to undertake this work, instead of, for instance, mounting quick-firing guns to resist a torpedo attack. I did not want Australia to be cursed with a system of incompleteness by beginning a second work before the first had been finished. The provision made upon these Estimates will bring us to a point at which many of the proposals included in Major-General Hutton’s scheme are practically complete, so far as equipment is concerned. We have not the money to accomplish everything in one year. My idea was that we should be able to say, “ Now that this work is complete, we may turn our attention to another.”

Mr Austin Chapman:

– A great deal of that incompleteness is due to the omissions from Major-General Hutton’s report.

Mr McCAY:

– It is not owing to anything, except that we could spend only a certain sum in each year. In the first year we could not finish any of the works outlined, and in the second year we could not complete everything. The Treasurer seems to entertain the idea that there is some magic in increasing the number of rifles. I have no desire to see the members of rifle clubs hampered in any way, but I ask the Government not to be induced to purchase more rifles whilst they have not sufficient equipment for the number of men whom our present stock of rifles would supply. We have in the Commonwealth magazine rifles for every man in the Australian forces upon a war establishment. There are 40,000 troops in the Commonwealth upon a war footing, 9,000 of whom do not require rifles, and we have 35,000 magazine rifles available, including 5,000 of the new service short weapon, as to the superiority of which there appears to be some doubt, although the War Office is adopting them, and they have been given to our light horse. We have the rifles to equip the forces on a war footing ; but let us put them on a war footing in other respects before we think of buying stands of thousands of rifles. Let us have them all in time. Do you remember, Mr. Chairman, what Wolseley said of the American Civil War: that a completely equipped army corps of 35,000 men properly led could have won on either side. And yet we know that there were hundreds of thousands of men engaged in that war. We must have our forces completely equipped. A small completely equipped force is better than a large one incompletely equipped. To say, “ Here are 10,000 men and 10.000 rifles; fill your pockets, men, with ammunition, and God bless you,” would be to show an utterly mistaken conception of what is required. It is not from the possession of tens of thousands of trained halfequipped men that success will come; but rather from a thoroughly equipped force, whatever be its size. We have 40,000 men set up as the standard for the war strength of our garrison and field forces. Let us see that they are completely equipped before we do anything more.

Sir John Forrest:

– The men whom we sent to South Africa did not have much training.

Mr McCAY:

– Quite so, and it was the lack of training which caused them to be less valuable than they would otherwise have been.

Sir John Forrest:

– But still their services were valuable.

Mr McCAY:

– Undoubtedly. I am suggesting not that a man with a rifle is of no value, but that a completely equipped force is better than an ill-equipped one. It was those contingents which’ consisted of officers and men with little training that did harm to the name of Australia in South Africa, so far as the attacks upon it were justified. A disciplined, well-trained, wellequipped body of men, led by (trained leaders, can do far more than can a much’ larger body of untrained imperfectly equipped men. With a small number of well-equipped trained troops, I should be prepared to meet, without any fear, a large body of undisciplined unequipped men, and I urge the Government to carry out the suggestion I have made. The next step to take will be to secure quick-firing guns and search-lights for our fixed defences.

Mr Kelly:

– We certainly need cordite ammunition for the quick-firing guns.

Mr McCAY:

– When I took office as Minister of Defence, I found that guns had been ordered without ammunition. That is one reason why I had to spend £7,000 on ammunition for the field guns, and also £1,800 on ammunition, for the 6-inch gun for Hobart - although that gun was a transfer from South’ Australia. I ordered twenty-four field guns, as well as two or three big guns, and in each case I also ordered a proper complement of ammunition, so that when the guns arrived the ammunition should also be forthcoming. In estimating the price of a gun, it is necessary to include the cost of its proper complement of ammunition, and it is for this reason that I say that the twelve pounders will cost ,£2,000, instead of about £1,200 each. The proposed vote for special warlike stores was fixed at a certain amount. I need not say that the late Treasurer did not give me a free hand. I provided £180,000 for this purpose, and I trust that it will all be spent. If it is not expended on the items specified, I trust that the Treasurer, instead of seeking to actually save the money, will expend it on other stores - such, for example, as twelvepounders for our fixed . defences - that we can obtain from England. That would be. the right thing to do. It must be remembered that these items do not come under Major-General Hutton’s scheme. We also require a floating harbor defence in some of our ports. It may be that we shall require torpedo boats, as well as torpedoes to be fired from fixed positions on shore. We need booms, and possibly we may require submersibles or submarines, but I have very grave doubts on that point. I do not think- that submersibles or submarines would be desirable adjuncts to our defences. They can be used only against a fixed mark, and an enemy is unlikely to stay long enough at any one spot to afford us that fixed mark. I do not wish to discuss at the present time any of the details of the Estimates, although no doubt a number of questions will be raised at the proper time, and I hope then to be able to say something about them. I have endeavoured to explain to the Committee why I think that the proper development of Australian defence is in the direction of providing a thorough equipment for our land forces, whose war strength is, about 40,000 strong, and of thoroughly equipping our forts, with the addition of auxiliary’ floating harbor, defences. This is essential to enable Australia to discharge her duty to herself and her duty to the Empire of which I spoke earlier this afternoon. Desirable as it will be to have some vessels for the protection, at any rate, of our coastal trade in time of emergency - and I would remind honorable members that if the contingency comes, these vessels to be of any service must be placed under the orders of the officer commanding the Imperial Squadron - if we wish Australia to launch out on what is called an Australian Navy, we must first complete the work I have indicated. The inevitable dilemma on the horns of which the advocates of a partial Australian Navy find themselves is that that navy must, when the pinch comes, obey the orders of one central authority. .

Mr Webster:

– Would the honorable member advise that we should not tram our -men for the navy?

Mr McCAY:

– The present Estimates provide for an increase of nearly 30 per cent, in the naval forces - for an increase of 200 on 600 or 700 men. I certainly wish to see our Australian sailors trained, but I desire to warn the Committee, if I may be permitted to do so, that, in view of the scheme which is now being developed, there is a definite object to be attained, and that if we leave that scheme to start on another, we shall not be able to complete it within a reasonable time. We shall not be doing our duty by abandoning a scheme which we can complete within a reasonable time. When we have our naval bases, our coaling ports, our harbors of refuge, and our centres of commercial and industrial life quite safe, so that from those safe points our fleet, or the Imperial Squadron, may move out to strike the enemy, secure in the knowledge of a safe point of retreat if it be required, and that our coastal shipping and our oversea trading vessels will be safe in harbors where they may temporarily lie up in case a great emergency arises - and it would only be in time of great emergency that this condition of affairs would arise - it will be our duty to see how we can best develop a navy of our own. But until Australia chooses to maintain such a navy that it can meet other navies without Imperial assistance, I shall decline to support a proposal in that direction. I shall decline to do without the Imperial assistance and the assurance that is provided by our living under the Imperial flag. But our harbors and our coastal and sea-borne commerce, and the commerce approaching our shores are proper objects for Commonwealth protection, so far as seagoing ships, cruisers, and so forth can insure their protection. That is the object at which’ we should aim. I appeal, however, to the Committee not to leave one thing unfinished to begin another. The proper development is that which I have outlined. No nation ever developed into a great maritime power without first making herself safe on land - without making a secure launching point from which her naval power might proceed.

Mr Poynton:

– Is the honorable member going to make any suggestion as to ways and means?

Mr McCAY:

– I hold that we cannot do all this out of revenue, and I have strong objections to the Commonwealth becoming a borrowing community. I say frankly, however, that we need to get promptly into a proper position, so as to be able to develop Australian defence in the way that it ought to be. That cannot be done with the small sums that are available year by year for such a purpose. It seems to me, therefore, that the only way in which we can deal with the matter is to take the bull by the horns and to say clearly that we wish to secure a good start. We have not yet got it. Let us obtain the necessarymoney by the issue of, say, Treasury-bills, repayable in the course of five or ten years. I should certainly have this expenditure covered by the revenue of the next ten years at the outside. Let us acknowledge that there is a good deal that has to be done. I have not yet said much about the naval side of the question, but I do not wish it to be thought that I am hostile to the suggestion that we should have Australianowned ships or Australian sailors. As a matter of fact, I am not. I am simply urging that these proposals should not be taken out of their order.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Has the honorable and learned1 member made any financial forecast ?

Mr McCAY:

– Including the cost of supplies not yet ordered under Major-General Hutton’s scheme, the outlay will be about £800.000. I think it is desirable that we should say frankly, “ We will discount a bill for £800,000, or a smaller sum, if it be found possible. We will discount the bill, whatever it is, and pay back the money by instalments during the next eight or ten years.” We should then have our defences on a proper footing, and would be able to continue on ‘a less expenditure than would otherwise be necessary.

Mr Chanter:

– Could we not make this provision by retaining the whole of our one-fourth of Customs revenue?

Mr McCAY:

– No; I have the taxpayer in mind. If we expended the whole of that revenue the States would have to make good the difference by some other means.

Mr Chanter:

– The position would be the same if we borrowed the money.

Mr McCAY:

– But one may borrow £1 and repay it by ten instalments of 2 s. each.

Mr Hutchison:

– If life and property need this protection the people must pav for it.

Mr McCAY:

– I am merely expressing my view that the taxpayers of the Commonwealth cannot afford to at once incur this expenditure; they cannot afford to pay £400,000 this year, and another £400,000 next year for any such purpose as special warlike stores and guns.

Mr Webster:

– We might have secured these stores when we had a larger surplus to return to the States.

Mr McCAY:

– 4 then had no direct responsibility ; but I always bear in mind the fact that it is the taxpayers themselves who have to provide this money, and that the Treasurer does not obtain it from some mysterious unknown stream. We have to take the bull by the horns, and recognise that we must spend this substantial sum within the next year or two. The only suggestion that I have to make is that we should provide the money by means of short-dated Treasury-bills - or whatever particular form of obligation it is proposed to incur - and redeem them by annual instalments out of the Commonwealth revenue. I should not leave these annual instalments to the mercy of the annual Estimates, but at the same time as the money was provided would pass an Act appropriating revenue for this purpose for a given time.

Mr Henry Willis:

– The guns would have to be replaced before the whole of the money was repayable. The honorable and learned member himself made that admission.

Mr McCAY:

– It will be unnecessary to replace the guns more often than at intervals of eight or ten years. What I said was that if the idea were developed, we might have to make changes. I have spoken at much greater length than I had intended, but the subject of defence is one in which I take a deep interest. I have ventured to elaborate my views, realizing the seriousness of the situation to Australia, and I hope that what I have said may possibly be of some service to the Government of the day. and assist them to solve this very difficult problem.

Mr ROBINSON:
Wannon

– I wish to commence my remarks by expressing my sense of the value of the most excellent speech of the honorable and learned member for Corinella. What many of us have been waiting for a considerable time to hear has been a complete, connected, and consistent exposition of a defence policy for the Commonwealth. In the speech to which we have just listened, and which secured the rapt attention of honorable members, a vast amount of information was given to us. It is a speech which I think ought to be reprinted ; and I certainly hope that steps will be taken, either by the honorable member or by his friends, to see that copies pf it are circulated through the country press. _ In listening to the Budget which the right honorable the Treasurer delivered last week, I could not help thinking of a prediction made by the present Chief Justice of Australia, Sir Samuel Griffith, that the finance question is likely to be the rock upon which this Federation would find it very difficult not to split. The speech of the right honorable gentleman seems to me to indicate that we are in danger of getting upon the financial rocks; or, if we ourselves avoid that danger, certainly we are in danger of getting some of the States upon the rocks. I regret that the right honorable gentleman should have dealt in such a casual way with what seems to me the great safeguard of the States under our Constitution - what is known as the Braddon section ; and I gave expression to my astonishment by interjection when the Treasurer made his remarks.

Sir John Forrest:

– There are other ways to protect the States, apart from the Braddon section.

Mr ROBINSON:

– The right honorable gentleman is reported at page 1217 qf Hansard to have alluded to the matter as follows : -

I do not see that much good can result to the States by extending the duration of the Braddon provision.

Sir John Forrest:

– “To the States,” the honorable member sees.

Mr ROBINSON:

It may restrict the spending powers of this Parliament, but I cannot imagine that we shall do anything to injure the people of the States.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– How long has the Treasurer been of that opinion?

Mr ROBINSON:

– The interjection of the honorable member for Parramatta is most pertinent. How long has the right honorable gentleman been of that opinion?

Sir John Forrest:

– The sentence quoted by the honorable member follows after some other observations on the same subject.

Mr ROBINSON:

– I am quite aware that the Treasurer said that protection to the States might be secured by giving them a fixed sum ; but he also stated that in Canada, where that was done, the conditions were so different from those in Australia as to make the example of very little value to us.

Sir John Forrest:

– In regard to the amount paid, I meant.

Mr ROBINSON:

– The States of Australia have regarded, and still regard, the Braddon section as the only one which secures to them a sufficiency of revenue to meet their annual obligations, and it seems to me that any proposal which impairs that safeguard without replacing it by some equally valuable one is most dangerous.

Sir John Forrest:

– Hear, hear ! I agree with that.

Mr ROBINSON:

– We are faced by the fact that by the year 191 1 this Parliament, unless action be taken to the contrary, will, be in a position to distribute the whole of the revenue received from Customs and Excise absolutely as it pleases. It is, therefore,, imperative that those who desire the States of the Commonwealth to remain in a solvent, prosperous condition should see that steps are taken to safeguard their interests. There are three aspects of the Budget to which I wish to address myself. The first is the cost of Federation. Reference was made by the right honorable gentleman to the estimate of the cost of Federation given to the Adelaide Convention in 1897 by Mr. - now Sir Frederick - Holder, our present Speaker. The paper which was laid upon the table of the Convention, at his instance, estimated the total probable new Federal expenditure. We cannot look at that .estimate and compare it with the estimates of expenditure for the current year without noticing that there is a constant tendency to increase, and that we are faced by the prospect of a considerable rise in the cost of the Federal Departments. For example, I find that the estimate of the cost of the Legislature and the Executive was about. ^123,000. That sum has already been exceeded by about ^12,000 or £13, 000. There is no likelihood of the increase being reduced, but rather of its being increased. The estimate for the expenditure of the Home Affairs’ Department, with which was included the cost of a High Commissioner, was ;£i 8,000. I find that the Department of Home Affairs is estimated for the present year to cost £42,000, exclusive of any provision for the High Commissioner. In every other Department one finds similar increases in Federal expenditure. The prospect held out to those -who wish- to see economical government, and a large amount of money returned to the States, is not a very pleasing one. The matter is further complicated by the introduction of the very difficult sugar bounties question. In connexion with this question, the Treasurer made a most extraordinary statement in the course of his Budget speech. The right honorable gentleman gave an estimate as to the cost of Federation, and proved to his own satisfaction that it was last year £3 12, 000, the year before .£342,000, and that it would this year be less than £300,000. When one examines the whole of the figures, one is forced to the conclusion that those who put that sum down as the cost of Federation must make use of a system of arithmetic peculiar to themselves.

Sir John Forrest:

– From what page is the honorable and learned member quoting?

Mr ROBINSON:

– From page 1208 of Hansard. The right honorable gentleman estimates “ other “ expenditure this year at £296,961, and there is a further estimate of expenditure of £589,081, and he says this: -

The amounts included in the ^589,081 would have been expended if Federation had not been accomplished.

I deny that statement ‘as vigorously as it is possible to do, because I find that one item included’ in the amount is an expenditure in connexion with sugar rebates, amounting to £151, 670

Sir John Forrest:

– I clearly pointed that out.

Mr ROBINSON:

– That expenditure is a purely Commonwealth expenditure. If we take the State of Victoria for example by no possible means can it be shown that any portion of the sugar’ rebates would have had to be pai.d by Victoria, if it were not for the accomplishment of Federation. Before Federation, the revenue derived by Victoria from sugar amounted to £290,000 a vear. This year the revenue of Victoria from sugar will come down to £150,000. We shall thus have lost about 50 per cent, of our revenue from sugar, whilst wholesale and retail consumers of sugar in Victoria will not get that commodity at a fraction of a penny cheaper than they got it before Federation. As a result of . the policy adopted by the Federation, there has been no reduction in price, and the greater portion of the benefit derived from that policy is being reaped by one very wealthy company - a concern of a most profitable nature. In addition to the loss of revenue which we in Victoria suffer from the present sugar policy of the Commonwealth, our fruit-growing industry, which was a very flourishing and promising industry, is being slowly strangled by the operation of that policy.

Sir John Forrest:

– How will it be strangled ?

Mr ROBINSON:

– I propose to show the right honorable gentleman. In dealing with the fruit industry, I can claim to speak with some little knowledge, because two brothers of mine were deluded into going into this industry some years ago. I think I can say that they sank about £2,000 in the industry, and they have been verv glad to clear out of it at one-fifth of the amount which they put into it.

Sir John Forrest:

– There has always been a duty on sugar in Victoria.

Mr ROBINSON:

– I have had a statement prepared relating to the effects of the sugar policy of the Commonwealth, which has been checked by my relations, who have been engaged in the fruit industry, and also by the members of theGoulburn Valley Fruit-growers’ Association. The statements I propose to make on the subject have been confirmed by experts in the trade. These men, who are earning their living from the industry, of their own knowledge assert that these statements are accurate and well founded. The fruitgrowing and preserving industries are very large industries in Australia, and they would now be much larger only that, as I say, they are being strangled by the sugar policy adopted by the Commonwealth Parliament. I might here say that, although the fiscal question comes into the matter- to some extent, I am prepared to sink my freetrade views, and to give a reasonable amount of assistance to growers of sugar’ by white labour, in order to secure, if we can, the triumph of the policy of a White Australia. But I do say that the policy that we have adopted in the past is a policy involving the most extravagant waste of public money, and one which’ is throttling what ought to be a very flourishing indus try.

Mr Johnson:

– I said the same thing, and the honorable member for Moira denied it.

Mr ROBINSON:

– In dealing with1 this question of the effect of the sugar policy on the fruit-growing industry, honorable members should be informed that the whole of the fruit grown in an orchard is not used for fruit preserving or jam-making, and if we say that about one-half of it is so used, we shall be making a reasonable statement. I take the case of an orchard in which plums are grown. In the statement to which I have referred I find the following :-

Plums. - One acre is usually planted with 120 plum trees, the average produce of which is incases, equal to 60 lbs. The average yield per acre, therefore, is 7,200 lbs. of fruit, which, at £d. per lb., the average return during this season, would give £i$ per acre. To transfer this quantity of plums into jam, requires 7,200 lbs. of sugar, the duty on which, at £6 per ton, amounts to £% 5s. 8d.

Sir John Forrest:

– Why does not the honorable and learned member refer to the ;£3 Excise duty ?

Mr ROBINSON:

– Permit me to deal with this matter in my own way, and I shall come to the Excise duty afterwards. I am now dealing with the case of a man who. in the first instance, pays duty in Victoria, and showing that those who use colonial sugar do not thereby get an advantage of more than a few shillings, the reduction made on colonial sugar being just sufficient to prevent other sugar coming into the market. Some sugar has, of course, to come in, because the local production is not sufficient.

The duty on the sugar actually amounts in this case to 128 per cent, of the value of the fruit, and sometimes more than the value of the land with its improvements, on which the fruit is grown.

Peaches. - The usual number of trees per acre is 100, each yielding on an average 80 lbs. of fruit, or 8,000 lbs. per acre. The average price paid to the grower is £7 per ton, equal to £25 per acre. Stoning reduces the weight of the fruit by 10 per cent., i.e., 7,200 lbs. An equal quantity of sugar being required to convert this into jam, the duty in this case amounts to £19 5s. 8d., or to 77 per cent, of the value of the fruit.

Sir John Forrest:

– What was the tax before Federation?

Mr ROBINSON:

– Before Federation there was in Victoria a duty of £fi per ton on sugar from Queensland or any other part of the world, except beet sugar, and in respect of the sugar used by factories a rebate was granted.

Sir John Forrest:

– Where, then, is the injury?

Mr ROBINSON:

– I hope “the right honorable member will allow me to proceed in my own way, because I desire to show the difference between the two policies. I desire to show how, when the present policy comes to fruition, the whole of the damage will have been done ; that, while the people of Australia will not receive a copper in revenue, the Colonial Sugar Refining Company will be made a present of about 000,000. The statement continues -

Apricots. - 140 trees per acre, yielding 8,400 lbs. per acre. At the average value of £y per ton, the grower would receive £26 5s. per acre. Stoning reduces the weight to 7,500 lbs. An equal quantity of sugar is necessary to make into jam, the duty on which, at £b per ton, amounts to £20 5s., equal to 77 per cent, of the value of the fruit.

Quinces. - The yield averages 4 tons per acre, of an average value of £3 per ton. An equal quantity of sugar is required to convert these into jam, i.e., 4 tons of sugar. The duty, therefore, amounts to £24 per acre, equal to twice the value of the fruit.

To put these facts in another way : -

I repeat, for the purpose of allaying mls- apprehension, that it is” not the whole of the orchard that is used with the object of fruit preserving or jam-making. The Treasurer has pointed out that locally-grown sugar cultivated by black labour pays only £5 per ton to the revenue, sugar cultivated by white labour paying £1 per ton only, as against £6 per ton paid on imported sugar ; but the right honorable gentleman forgets that there are certain circumstances which must be taken into account. Prior to Federation, Queensland sugar was sold in Victoria at j£j$ per ton in bond; that is to say, it paid a duty of £,6 per ton, and was then sold at ^19 or ^20 per ton. The fruit-preservers and jam-makers in Victoria could buy Queensland sugar in bond at the price I have named. The import duty on sugar in Queensland was inoperative in that State, as a duty on wooF would be inoperative, seeing that far more is produced than is required fpr the local market. The whole of the sugar produced in Queensland was, therefore, sold at the world’s price, which was about ^13 per ton. At the present time a purchaser cannot obtain the Al sugar of the Colonial Sugar Refining Company much under £24 per ton, less a certain small discount, though it is only fair to say that there has been a rise in the price of sugar all over the world, partly owing to the denunciation of beet sugar bounties. Owing to the causes I have indicated, there was an increase in the world’s price of about ,£5 per ton ; and in Queensland, of course, every sugar-grower benefited, just as the wool-growers of Australia would benefit by an increase in the world’s price of wool. Before this rise took ,place, suga>r from China, the Mauritius, or any of the Eastern ports was landed in Melbourne at £13 2s. 6d. a ton, whereas now it is about £18 7s. 6d. per ton. The Ai sugar of the Colonial Sugar Refining Company was formerly £20 per ton in Melbourne, whereas now it has gone up to about £23 per ton. It is most astonishing that Queensland sugar has always been cheaper in Melbourne than in any other part of the world, and prior to the rise in price that sugar in bond in Melbourne was £6 per ton more than the imported sugar, whereas after the rise the difference between the two was only £3 14s. That shows that the whole of the duty has been, collected by the Colonial Sugar Refining Company ; but, in fairness to that company, it must be said that it did not raise the price to the extreme limit to which it could have been raised in competition. However, the reasons for that policy were given bv the chairman of directors of the company on the 28th October last - and those reasons are worth repeating - as follows : -

Unfortunately, we have not, except to a very moderate extent, been able to profit by the heavy advance in price, for the large production of sugar in Australia this season, unduly augmented by importations from various quarters, compels us to maintain our rates at a level which, while discouraging further importations, would insure the disposal of our supplies, and, as we have only recently raised our prices, last half-yearly accounts do not derive any benefit therefrom.

The “ moderate extent “ to which local sugar has so far benefited by the rise is, nevertheless, £2 171s. 6d. per ton.

Sir John Forrest:

– What dividend was declared ?

Mr ROBINSON:

– Last year I think a dividend of 15 per cent, was declared. This is a very well-managed company. The directors show only enough profit to pay good dividends,’ the balance being, expended in wiping off imaginary ‘depreciation and in ways of that kind - something like a company with which we are all familiar when we travel in the trams to Parliament House. The sugar industry flourished in Queensland when the price was £13 per ton, and the price is now £23 per ton. But out of that return, excise of .£3 per ton ‘has to be paid if the cane be grown by black labour, and £1 per ton if it be grown by white labour. Thus the net return to the producers, growers, and refiners, is about £7 to £9 per ton more than previously. If we take the lowest estimate, and say that the price is only £7 10s. higher, there were 150,000 tons produced last year, so that through the increased price caused by our present policy, and the rise in the world’s price, the industry is receiving over £r, 000, 000 more than the profit which used to be derived from the same quantity of sugar prior to Federation. That, of course, does not represent all the burden that is placed on the shoulders of the users of sugar. There is not only this £1,000,000 paid to the people engaged in the industry, but the Government collects about £530,000 in revenue, after allowing, of course, for rebate or bounty. The total sum collected from the people in respect of the sugar industry is nearly £1,600,000, and only one-third of that goes into the Treasury. According, to the Customs Tariff Act, when this policy in regard to sugar is completed, not only will the bonus arid the excise cease, but the present duty is to be maintained, and if 180,000 tons represents the consumption of Australia, this ‘company will be able to collect £5 or £6 a ton, or from £900,000 to £1,000,000 from the people, and the Treasury will not get a solitary sixpence of the amount. For some years past, the great bulk of the sugar :has been produced by black labour and the sugar-growers have received a very handsome bonus from the country. Prior to Federation, a large quantity of sugar was produced in New South Wales by white labour. Under the present policy, the sugar-growers in that State are very much better off than they used to be, since they get a bonus for doing something now which they used to do for nothing. They used to produce their sugar under a protection of £3 per ton. It “seems an extraordi-nary policy. It must not be forgotten that one very important item in the Tariff which keeps the sugar market in subjection to one company is the fact that the import duty is £10 a ton on beet sugar and £fi a ton on cane sugar. The result is that beet sugar cannot possibly be shipped to Australia. If beet sugar were subject to the same duty as cane sugar, there would be a very great possibility of a large quantity of the former being landed here. But under the present system the possibility of keeping the local company in check is annihilated by the difference in duty on the two kinds of sugar. As I have said, I am prepared to make a sacrifice for the purpose of allowing this policy to be carried out, and assisting to make it successful if we can. But at the same time, I do not wish to see the large and abundant revenue which the States used to collect from this source imperilled. If the policy of the first Federal Parliament be carried out to its extreme degree it will land us in the position that not a fraction will come to the revenue from sugar, because, not only the bounty, but the excise duty is to cease, and the people of the Commonwealth will pay an increased price for their sugar ‘by reason of the fact that one company controls the Australian market.

Mr Conroy:

– I beg to call attention to the state of the Committee. [Quorum formed.]

Mr ROBINSON:

– It means that the people of Australia will have to pay a very large tax to the persons engaged in this industry. It must not be forgotten that prior to Federation the sugar industry obtained a footing mainly on free-trade conditions, and that for all sugar exported from Queensland, the Colonial Sugar Refining Company had to accept the world’s price, then about £13 per ton, and now considerably higher. If we were to reverse our policy and go to extreme free-trade, the sugar-grower in Queensland would be better off than he was before Federadon was established. I do not ask honorable members to take that course, but I do suggest that there : is a remedy to be found whereby the States would receive some revenue from this source, and the interests of the States’ Treasurers would be considered. I think that by imposing an import duty of £5 or ^6 a ton on sugar, it is possible to levy an excise duty on sugar, allowing a difference of £2 between the import and excise duties in favour of sugar grown by white labour, and of £.1 only in favour of sugar grown . by black labour. That would be a sufficient sum to allow to the sugar-growers, because then they would be £2 per ton better off than they were outside Queensland prior to Federation.

Mr Groom:

– How about the internal market ?

Mr ROBINSON:

– I cannot give expert testimony as to the fact; but I believe that prior to Federation the Colonial Sugar Refining Company sold its sugar in Queensland at the same rate as it did in Victoria in bond.

Mr Groom:

– In fixing these prices, has the honorable and learned member taken into consideration the cost of production outside Queensland and in it?

Mr ROBINSON:

– No; what I :have taken into consideration is the undoubted fact that prior to Federation the Colonial ‘ Sugar Refining Company sold its sugar in bond in Melbourne at .£13 per ton. If we had complete free-trade established today, it would get a higher price than that. If sugar could be sold then at ^13 a ton, certainly it could be sold at a profit when they would get £^17 or ^18 per ton. I do not ask any honorable member to agree to a policy so radical as that. If we were to impose an excise duty of £4 per ton and an import duty of £6 per ton a very large revenue would be derived from sugar; the Commonwealth would be better off, the industry in Queensland would be very handsomely treated compared with its condition prior to Federation, and the whole of the Commonwealth would gain by such a policy. This proposal is, I think, some violation of my free-trade principles, but I recognise that the industry is in a peculiar position. We have ordered the sugargrowers to’ reconstruct their business on a White Australia basis,, and for that reason T think we should make a sacrifice of principle in the hope that we may bring that policy to a successful issue

Mr Conroy:

– Why should we pay to keep in cultivation some of the best land in Queensland?

Mr ROBINSON:

– I believe it is rich land; but in the interests of Queensland I am prepared to make this sacrifice, so that its sugar-growers shall be unable to say that they were unfairly treated by this Parliament. If the present system be continued as proposed by the Treasurer, I feel convinced, as the honorable member for Maranoa interjected, that at the end of five years, we shall be asked to renew the bounty for another term of five or ten years, and every time we take that course we shall be throwing away a large amount of revenue. If the people of Queensland were to get the revenue which they would get from sucha policy as I have indicated, they would not be in the position in which they now are as regards the Federal revenue generally. Queensland has been hit very severely by the Customs arrangements of the Federation. For a number of years past that State has not got back three-fourths of its contribution in Customs and Excise duties, and its Treasurers have been at their wits’ ends because the returns made to them by the Commonwealth Treasurer have not been so large as, previous to Federation, it was anticipated that they would be.

Mr Henry Willis:

– South Australia has suffered, too.

Mr ROBINSON:

– Yes ; but Queensland has suffered more than any other State in this matter. It is not, however, my intention to devote more time to the question now. I can only hope that steps will be taken by this Parliament to secure to the taxpayers of’ the States some of the reward which will otherwise go to a very large company, which is very skilfully managed, and well engineered, and an extremely profitable concern to those who have the good fortune to be shareholders in it. I wish next to deal with a matter which I consider still more serious - the taking over by the Commonwealth of the debts of the States. I must again express astonishment at the attitude of the Treasurer. 1 It is arguable whether the Braddon provision should be extended. That is a point on which I believe honorable members hold different opinions ; but in view of the earnest manner in which the present Treasurer and his chief supported the provision at a Conference of Treasurers held in 1904, I am filled with amazement at the casual and offhand manner in which he dealt with it in his Budget speech. Last year the Prime Minister, when at the head of a former Government, with the then Treasurer and the present Treasurer, attended a Conference of States Treasurers, at which proposals were made for the transfer of the debts of the States to the Commonwealth, the Government agreeing, upon certain conditions, to an extension of the Braddon provision, though, of course, they could not bind this Parliament. The Treasurer supported that position, and yet in his Budget speech he made a statement which indicated that he was not in favour of extending it.

My honorable friends in the Labour corner had a conference a short time ago, and passed a resolution affirming that the Braddon provision should1 be knocked on the head at the first opportunity, and the Treasurer therefore now sings the same tune. I congratulate them upon their victory, upon having added his scalp to the trophies at their belt; and I hope, for their sakes, that the right honorable gentleman will be found as docile in the future as he appears to be now. But unless the debts question is to be settled effectively before 1911, the outlook for the people of Australia will be serious. We in Victoria are better off than are the other States, because our burden of debt per head of population is less than theirs.

Mr Conroy:

– Including shire and municipal debts?

Mr ROBINSON:

– Even including them, Victoria’s burden of unproductive debt is lighter than that of any other State.

Mr Groom:

– Victoria, unlike Queensland, has not had a. large territory to develop.

Mr Tudor:

– Nor so much public land to sell.

Mr ROBINSON:

– I thank the honorable member for Yarra for the interjection. In the Victorian Year-Book for 1904 the Government Statist says that loans to the amount of nearly £60,000,000 have to be redeemed within the next ten years, and to the amount of £106,000,000 within the succeeding ten years. Unless the bulk of the Customs revenue is secured to the States, I do not think we can successfully negotiate for the redemption or extension of those loans.

Mr Spence:

– Let the people of Victoria put on a good land tax.

Mr ROBINSON:

– The amount of revenue to be derived from direct taxation is not illimitable, and if the honorable member were Treasurer he would find that he could not raise enough by that means to settle this question. Over £200,000,000 of the indebtedness of the States, interest and principal, is under their loan Acts chargeable on their public revenue ; and five-sixths of their loans were raised while their Customs and Excise revenue was entirely under their control, and the balance while the bulk of that revenue was still being returned to them by the Commonwealth. It therefore follows that if their returns of Customs and Excise revenue are diminished, or altogether cease, their position will be an unenviable one, because twothirds of their revenue is obtained from that source. It may or may not have been a desirable thing, but it is an undeniable fact, that since the inauguration of responsible government in Australia the great bulk of our .revenue has come from indirect taxation, and the loans which we have contracted have been practically charged on Customs and Excise receipts. Therefore, if the States are to meet their liabilities, the bulk of this revenue must be secured to them, [f in 1911 the Commonwealth, by reason of this “let-slide “‘policy of the Treasurer, has obtained absolute control of the Customs and Excise revenue, the position of the States will be very serious. The statement contained in a resolution passed by a Conference of State Premiers” in 1903 sums up the position more accurately than any words of mine would do -

That this Conference submits for the consideration of the Federal Government the following resolution : - “ Having regard to the fact that the debts of the various States were incurred upon the security of the revenues of the State, and as the greater part of the revenues has been transferred to the Commonwealth in Customs and Excise duties, and having regard to the fact that the permanent financial stability of the States must depend upon either (a) the continuance of the application of the principal part of those revenues to the payment of interest of the debts; or (b) the imposition of very largely increased direct taxation in various States, it is resolved that in order to secure to the several State Governments the guarantee contemplated by the Constitution the provisions of the Constitution with respect to taking over by the Commonwealth of the debts of the States, or a proportion thereof, should be brought into operation as soon as possible.”

Then they go on to say in words which, I think, no honorable member can successfully contest -

The experience of all constitutionally governed countries proves that an overflowing Treasury means a swelling expenditure. The only effective check upon an excessive expenditure of public money is the necessity of resting upon the spending body to provide ways and means by the imposition of additional charges upon the taxpayers. Where this necessity does not exist, or does not exist so far as the spending body is concerned, these manifold political forces tending to increase the public expenditure are left to work unchecked. To be effective the check must be direct and immediate, not indirect and merely consequential.

If the Treasurer’s policy of letting things slide is to be pursued, the Federal Government will, in 1911, find itself in uncontrolled possession of an. immense sum of money. There will be no obligation on their part to devise means to make charges on the taxpayers, and they will escape all punishment’ for their misdeeds, because the evil will have been done before retribution, at the hands of the people, can overtake them.

Sir John Forrest:

– We shall have taken over the debts before that time.

Mr ROBINSON:

– In that case the Braddon clause will not worry the States, because if the debts of the States are taken over the tendency to extravagance on the part of the Federal Government will be effectually checked.

Sir John Forrest:

– We shall assuredly have taken over the States’ debts before that period is reached.

Mr ROBINSON:

– I am very glad that ten days have brought about such a complete change in the views of the Treasurer.

Sir John Forrest:

– There has been no change. I have said that from the beginning.

Mr ROBINSON:

– I agree with the view taken, by the late Treasurer, and I believe also bv the right honorable gentleman now occupying that position, that some protection must be afforded to the Commonwealth, that is to say, when the Commonwealth is renewing a loan or floating a new loan, it must not be possible for a State Treasurer to spoil the market by rushing in and endeavouring to raise money. I believe that that is a sound proposition, and that steps should be taken to prevent any clashing of borrowing in. the London market. The States Treasurers should, as “far as possible, be limited to the local market for borrowing purposes, and the Commonwealth should have the sole power to borrow in London.

Sir John Forrest:

– We are becoming more in agreement every minute.

Mr ROBINSON:

– If the right honorable gentleman will only earn’ out the suggestion made at the Treasurers’ Conference in 1904, we shall be found working together, and the scalp which now adorns the belt of the honorable member for Bland will once more occupy its proper place. Threefourths of the Customs and Excise revenue is undoubtedly insufficient to pay the interest om the States’ debts. Therefore, the States’ Governments must make up the deficiency in some way or other. It has been suggested that the Federal Treasurer should hold a floating lien over the railway revenues of the States. But strong objection had been urged to that idea, and, I think, rightly so, because railway policy is a matter of internal development that we should leave entirely in the hands of the States’ Governments. Mr. Irvine, the late Premier of Victoria, has made what I conceive to be an excellent suggestion, namely, that each of the States should pass a special Act, appropriating revenue sufficient to meet any deficiency between the amount received from Customs duties and the sum necessary to pay the interest on their debts. He points out with considerable force that the only protection the bond-holder has at present is afforded by the special States’ Acts, which appropriate part of the States’ revenues towards the payment of the interest on the money borrowed. If the States give the Commonwealth a guarantee of a similar character, it should prove sufficient. The Constitution provides that the States must indemnify the Commonwealth for any debts that may be taken over, and Mr. Irvine, who is a well-known lawyer, holds the opinion that that provision could be enforced before the High Court, and that that tribunal could find an appropriate remedy, in the almost inconceivable event of a State failing to make good any deficiency. I also agree with the idea of the right honorable member for Balaclava that a sinking fund should be attached to every loan, whether it be floated in London or upon the local market. In this connexion we ought to consider the true indebtedness of Australia, and compare it with the indebtedness of the mother country. The true indebtedness of a country is to be measured by the amount of taxation the people are called upon to bear in order to pay the interest on their debts. In the event of a Government borrowing money and spending it upon a reproductive work, such as a railway, which returns a revenue sufficient, not only to meet the working expenses, but the interest on the debt, no burden is imposed upon the taxpayer; but if the work is not remunerative, and does not earn a sufficient amount to pay the interest the taxpayers have to make good the deficiency, and the debt thus becomes a real burden. The national debt of Great Britain has been incurred for the purpose of carrying on what are called unproductive enterprises - that is to ‘say, in the defence and extension of the Empire - and to this fact the Commonwealth and other portions of the Empire owe their existence to-day. It will hardly be believed by honorable members that, in spite of the fact I have mentioned, the unproductive debt of Australia constitutes a heavier charge upon its citizens than does the national debt of Great Britain, which has accumulated during 200 years of struggle for existence as a world power. By “ unproductive “ debt I mean debt for which the people are taxed in order to pay interest.Upon page 694, of Coghlan. I find that for the year ended 30th June, 1904, the sum of £8,996,000 was required to pay interest and charges upon the public debt of the States of the Commonwealth. Of that sum, a total of £5,240,000 was raised from the works in which that money had been invested - from railways, water supply”, harborand sewerage works, interest upon advances to settlers, local bodies, and from the land settlement policy. That is to say, that about £3,750,000 has to be raised by taxation “from the people of Australia in order to pay interest upon their indebtedness.

Mr Poynton:

-Dotheynot receive an indirect benefit?

Mr ROBINSON:

– I shall deal with that aspect of the matter presently. It seems to me that the method of charging everything to posterity is one which is fraught with considerable danger. We pay about £3,750,000 yearly in interest upon unproductive debt. In other words, comparing our national indebtedness with that of Great Britain, it is, roughly speaking, about £100,000,000. We have to pay interest upon that amount out of taxation alone.

Mr Poynton:

– We have an asset.

Mr ROBINSON:

– -The honorable member does not follow me. I am taking the asset at its value. Of the whole of the works uponwhichmoneyhasbeen expended in Australia, interest is earned only upon £5,240.000. The balance of the interest has to be raised by taxation. Consequently, if we compare our indebtedness with that of the United Kingdom, we find that the latter does not constitute as heavy burden upon the people of the mother country asour debt does upon the taxpayers of Australia, notwithstanding that there is an indirect advantage received in both cases. The indirect advantage received here is the stimulus which has been imparted to the enterprise of the country. Whether that has not been too dearly purchased is open to question. In Australia, our unproductive debt represents about £25 per head of our population - in Great Britain it is considerably less. There, I believe, it is about ;£i8 per head. The interest which has to be met by taxation in Australia represents about 18s. 6d. per head ; in Great Britain it does not exceed 9s. 6d. It will be seen, therefore, that from the point of view of indebtedness, we have a lot of leeway to make up. That is why I think that the States debts question is the most pressing which confronts the Australian people.

Sir John Forrest:

– But we cannot make the States anxious to transfer their debts.

Mr ROBINSON:

– The Treasurer must see that for the payment of interest upon their debts the States more than absorb all the revenue which they are likely to receive through the Customs. Consequently, they must rely upon the proceeds of direct taxation to pay interest upon future borrowings. That in itself will prove a very excellent check upon extravagant schemes for borrowing, either in Great Britain or elsewhere. In Great Britain, statesmanlike efforts are being made to extinguish the national indebtedness by the establishment of a sinking fund. The late Chancellor of the Exchequer, Mr. Ritchie, at the conclusion of the Boer War, provided that £27,000,000 per annum should be devoted to the redemption of the national debt. In the first year, £6,600,000 of that amount was expended in reducing the principal and the balance was devoted to paying the interest. Year after year a bigger proportion of that ,£27,000,000 will be. applied in redemption of the capital, and. consequently, a diminishing proportion will be required to pay interest. Mr. Ritchie calculates that if Great Britain has the good fortune to avoid being involved in war during the next fifty years, the whole of her indebtedness will be extinguished. At our present rate of progress in Australia we shall be doing very good work if we wipe out our national indebtedness in about a thousand years.

Mr Poynton:

– The honorable and learned member is assuming that our population will not increase.

Mr ROBINSON:

– T would ‘ point out to the honorable member that in other countries population grows Very much more rapidly than it does here.

Mr Poynton:

– Can the honorable and learned member name any country in which there is a greater growth?

Mr ROBINSON:

– There is a much quicker growth in Canada and the

United States. These facts are of sufficient importance to impress upon the Government the necessity of adopting a firm policy as regards taking over the States debts. Those debts ought to be taken over, and we ought to provide a sinking fund in connexion with their redemption, and to limit future borrowings as much as possible. In America the people of the States have deliberately set checks upon the power of Parliament to borrow money. I find, in connexion with one loan floated in Western Australia, a sinking fund of 3 per cent, was established. I scarcely think that our present Treasurer could have been responsible for that.

Sir John Forrest:

– I am absolutely responsible for it. There was a sinking fund of 1 per cent, attached to all our loans.

Mr ROBINSON:

– I congratulate the right honorable gentleman. If he will adopt the same course now, he will confer a lasting benefit upon the people of Australia. The sinking fund to which I refer is in the hands of trustees, who are outside of political control, and consequently it is of a far more satisfactory character than is the sinking fund of any other State. If the right honorable the Treasurer is responsible for the creation of that fund, he has something of which he may be proud. I wish now to say a word or two upon what has been called the detraction question. A good deal has been said about the detraction of Australia, especially in regard to the representations which have been made concerning the Immigration Restriction Act. I hold in my hand a copy of the debates which took place upon that measure in September and October, 1901. Judging by the speech which was delivered at that time by the honorable and learned member for Northern Melbourne, and the interjections of the honorable member for Bland, I conclude that the object of what is known as the contract labour provisions was of a two-fold character. The first object was to prevent men being imported into Australia during a strike, and the second was to prevent them being brought here under a misapprehension as to the wages conditions which’ obtained - upon the understanding that the wage was nominally small, whereas, in reality, it might be considerable. The object, in other words, was to prevent capitalists interfering in industrial strife, and to prevent men from being misled regarding the wages which were payable. With these objects - which are entirely worthy ones - I am thoroughly in accord. I cannot say, however, that the method of administration which is being adopted at present is a satisfactory way of. dealing with the question. To some extent both these objects have been met by the passing of the Conciliation and Arbitration Act. In Victoria the provisions of Wages Boards apply to over forty industries, while in New South Wales there is a Conciliation and Arbitration Act applying to every industry. I am informed that the present Government of Queensland have a Conciliation and Arbitration Bill on the stocks, and I think I may safely say that there is a reasonable prospect of any misapprehension as to wages in the bulk of the industries of the country being settled by some tribunal. It ..would, however, seem to be necessary to secure the second of the objects to which I have referred by giving any man’ who is brought here under contract the right to sue, as soon as he lands, for the prevailing rate of wages in the trade in. which he is engaged. Other action has been taken under this Act that must lead to a considerable degree of adverse comment in Great Britain and elsewhere. Take the case of the English groom, to which reference has been made to-day. So far as I understand the answers given by the Prime Minister to my questions - and I must confess that those answers were somewhat vague - exemption certificates are not usually issued in the case of Britishers, but are intended to be used in the case of foreigners who might be excluded from failing to pass the education test, or something of the sort. But we know that in the case immediately under notice a gentleman proposing to bring out certain horses from Suffolk required a groom to attend them on the voyage, and to accompany them to a station in New South Wales. The groom obtained an exemption certificate, but it is stated that the Agent-General acted wrongly in issuing that certificate. When I asked the Prime Minister, to-day what was the policy to be adopted in regard to white labour coming to Australia under contract, he said that the contract should be sent to the Department of External Affairs. The issuing of exemption certificates mav be a stupid policy, but it is far more expeditious than is that which the Prime Minister now suggests. If a man, requiring the services of an expert groom to travel with horses from a county in England to New South Wales, had to wait until the contract could be sent out to the Department of External Affairs, and returned to him, the groom’s chances of landing in the Commonwealth would be very remote indeed.

Mr Kennedy:

– Scores of men bringing horses to Australia are allowed to land here without any trouble.

Mr ROBINSON:

– But are they under contract ?

Mr Kennedy:

– They receive wages throughout the whole period of service.

Mr ROBINSON:

– If they are under contract, the employer commits a breach of the Act in landing them here.

Mr Kennedy:

– No.

Mr ROBINSON:

– It is all very well for the honorable member to deny my statement, but the Act cannot be misread. It provides that no man engaged under contract to do manual labour shall be allowed to land in the Commonwealth, except certain conditions are complied with. When I asked the Prime Minister to-day what were those conditions, he said that the contract must be transmitted to the Department of External Affairs.

Mr DAVID THOMSON:
CAPRICORNIA, QUEENSLAND · ALP

– The contract might be a verbal one.

Mr ROBINSON:

– In that event the provisions of the Act might be easily evaded. Let us take the case of several Britishers engaged in England to do other than skilled labour in Australia, and who have taken the precaution to obtain a written contract. What are they to do? The Prime Minister says that they must first send their contracts to the Department of External Affairs. If the Agent-General has been blamed for issuing exemption certificates in such cases, he certainly has been wrongly condemned. The issue of exemption certificates enables an intending immigrant to at once ascertain if he will ‘be allowed to land on reaching Australia. I think there also is a means of preserving the Act as it stands, and yet overcoming the difficulty in this respect. The object of the measure is to prevent men signing a contract to work in Australia while they are under la misapprehension as to the wages and conditions of labour prevailing here, and also to render it impossible for men to be brought here to defeat a, strike. The statisticians of New South Wales and Victoria issue handbooks in which they state the average rate of wages in every calling and trade in the Commonwealth. If honorable members turn to Coghlan they will find that he runs over the whole gamut of industry, and gives the average rate of wages in each State. The handbook as issued by the Victorian statistician furnishes the same information. These books ought to be in the possession of the High Commissioner, or our representative in England for the time being. It should be possible for any one who wishes to bring men to Australia, under contract for manual labour, to go to the representative of the Commonwealth in England who, on referring to these works, could at once determine whether the wages specified in the contract agreed with those ruling in the States. If they did, the necessary permit to land should be at once forthcoming. If that course were followed, I think that even the Labour Party, who hold very strong opinions on this question, could take no exception to it; but if we insist that in the case of men coming under contract to Australia, the contract shall, first of all, be scrutinized by the Department of External Affairs, we must of necessity achieve a reputation for wishing to keep white men out of the Commonwealth. The greater part of three months would be occupied in sending a contract from England to Australia, and receiving an answer.

Mr Poynton:

– Can an English lawyer practise on landing here?

Mr ROBINSON:

– He can. I am glad to say that a body of which I am the honorary secretary has passed resolutions, having the force of law, whereby any barrister or solicitor of England, Scotland, or Ireland can be admitted to the Victorian bar on paying the same fee as is required of Victorian barristers or solicitors seeking admittance to the English bar.

Mr Chanter:

– That does not apply to all the States?

Mr ROBINSON:

– I cannot speak for all the States, but I believe that English barristers and solicitors are admitted to practise in New South Wales.

Mr Conroy:

– That is so.

Mr ROBINSON:

– And also in Queensland, and in one of the other States.

Mr Poynton:

– If the honorable and learned member went to Western Australia he would find that the position was different.

Mr ROBINSON:

– I think the honorable member will ascertain on inquiry that the rule to which he refers has been modified.

Mr Spence:

– We shall have to import a number of British lawyers under contract.

Mr ROBINSON:

– I know that the honorable member is merely chaffing, but I should like him and his party to consider whether it would not be possible to so administer the Immigration Restriction Act that its objects might be achieved by the least objectionable means. With the objects they have in view I am in hearty sympathy ; but I cannot for a moment defend some of the acts that have been done in pursuance of that legislation. The same effects can be secured by a great deal less trouble, a great deal less annoyance, and without creating any unpleasantness .in any other part of the world. It can be secured without issuing exemption certificates or similar papers, which seem to brand ihe man as an undesirable immigrant from the start. I am glad that that matter has been referred to, because I think that the more certificates are issued the more like- 1’hood there is of coming to a decision whereby we shall be able to keep out men who may be brought here for improper purposes, and at the same time enable desirable immigrants to be brought to Australia in as large numbers as possible. I hope that the Government will restrain the impetuosity of the Treasurer, and that his policy of distributing millions to every one but the persons who should receive them will be checked. I hope also that some method will be adopted whereby the debt question as it affects the whole of the States will be settled on a basis satisfactory not only to the Governments of the States, but to the people of the whole Commonwealth.

Mr CONROY:
Werriwa

– I regret, that the Treasurer was not able to present a more satisfactory Budget to us, because it is manifest on an examination of it that the Commonwealth has come very near to the end of its tether, so far as funds are concerned. In the very near future only one or two courses will be open to us. Either we must stop introducing any fresh legislation whatever, or devise some system of direct taxation to raise the money that may be required. While I, for one, do not object to any method whereby part of the money shall be raised by direct taxation, I decline to assent to the principle that we should tax merely for the purpose of taxing. My desire is that every penny piece that is taken out of the pockets of the people should, as far as possible, go into the Treasury. I am bound to say that that is not the case under our present system. We are raising something like £8,700,000 in Customs and Excise duties. I am not going to refer to the amount of taxation raised in some of the States by direct taxation, because I have no doubt whatever that the sum so raised does not exceed that which is spent in public works, in making roads, and thereby improving property. Therefore that comes rather under the head of such taxation as pertains to municipalities. If we were to follow the system of taxation that is observed in England at the present time - that is to say if we were to maintain a proportion between direct and indirect taxation - nothing like £8,700,000 would Le raised through the Customs. But I regret to say that our method has been adopted with the consent of a great many of the party who if they really understood the meaning of the term labour, would be the very first to oppose it.

Mr Thomas:

– It was done with the consent of the people, unfortunately.

Mr CONROY:

– The honorable member is aware that all the members of the first Conservative Government of the Commonwealth were anxious to impose heavy duties, and they were permitted to do so, owing to the fact that a large proportion of members of the Labour Party did not understand the principle of finance which was being adopted, and absolutely allowed heavy burdens to be placed on the backs of those whom they represent. Those burdens will remain there, unless a greater number of that party come to their senses than is likely to be the case. I object to any man bearing any more taxation than is his fair share. When I find a man like the Treasurer, under a system that we call protective, paying, perhaps, less towards the revenue than another man with a family of half-a-dozen children, who is earning only a couple of pounds a week, I say that that is an unjust system. In my opinion, the fight against that system ought to be our principal task in the future. We ought to go before the electors prepared to reverse it, and to insist that not one penny piece shall be taken from the people more than is absolutely required, and that that amount shall be raised under a system that is equitable to all..

Mr Thomas:

– Would the honorable member advocate a Federal land tax?

Mr CONROY:

– There are only two forms of taxation - direct and indirect. In England 51 per cent of the taxation is raised by indirect means, and 49 per cent, is direct taxation. I am afraid that that proportion would be unjust in Australia. The discontent would be so great that it would not be advisable to introduce such a system here. There must be some proportion between the two systems. It is necessary that taxation should be raised for the preservation of law and order, and to enable the work of government to be carried on. In so far as it is necessary, we should all pay our share.

Mr Thomas:

– Under a land tax every one would pay his share.

Mr CONROY:

– Would the honorable member have only one form of taxation ?

Mr Thomas:

– I would, if I had my way.

Mr CONROY:

– I object to undue taxation on land-owners or people with large incomes, just as I object to it on the mass of the people. It is precisely because almost the whole of our revenue is now raised by one method of taxation that I object to it. If £8,700,000 is the amount that it is necessary for us to raise to carry on the government, and if we dealt with the matter as taxation is dealt with in England, we should raise about £[4,800,000 by Customs duties, and about £4,000,000 by direct taxation. For that class of men who, when the Tariff was introduced, did not care what happened as long as they felt that the burden did not fall on their own shoulders, I have no sympathy whatever. Four years ago, when the present Ministry and their followers were saying what a wonderful Tariff it was, and how . it was going to give employment here and there, honorable members on this side pointed out that that was exactly what it’ would not do, and that, on the contrary, it would prevent employment. I may refer to what I had to say on the subject myself, and I remember that I pointed out that the greatest defect of the Tariff, so far as consideration for the revenue of the various States was concerned, was that it was not so framed as to allow for the expansion or diminution for which a properly-framed Tariff would have allowed. If was not so framed as to afford a. kind of mark by which we might be enabled to judge of the prosperity or want of prosperity of the people of the various States. We have now absolute proof of that, and I regret to state that my remarks in that direction have been absolutely borne out. I think that, at the time, the present Treasurer rather agreed with me that the Tariff would not be an index of the progress of the people.

Mr Mauger:

– It is an index of their’ want of progress at present.

Mr CONROY:

– At the present time we have a large amount of taxation fastened upon the community under the operation of the Tariff, and as a result true progress has been prevented. What is still more serious, there is a deficiency in the revenue, which a Tariff pressing just as heavily on the people, but framed in another direction, might . have prevented. While imposing exactly the same burden on the people, we might have obtained a very much larger revenue by framing the Tariff in a different way.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– And had a great deal more destruction of industries.

Mr CONROY:

– 1 do not know what the honorable member means. Does the honorable member call a business which cannot stand on its own legs an industry?

Mr Mauger:

– Certainly.

Mr CONROY:

– Might I ask honorable; members opposite to say what is their test? Is it 5, 10, 15. 80, or 100 per. cent, of loss? Let us put it in the simplest way possible, to see whether the honorable member for Bourke is correct in his statement. He says now that if a man is doing work which is not in itself profitable he is still engaged in an industry.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I did not say that.

Mr CONROY:

– I asked the honorable member if, when a man’s work was done, it cost more to produce than it was worth, he was engaged in an industry, and the honorable member replied, “Yes.”

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– The honorable and learned member is re-stating the case in a different way.

Mr CONROY:

– I put it to honorable members opposite in this way : If a man does certain work, which costs him 49 and he gets 16s. for the result of his labour, is that an industry? I have only taken a difference of 4s. in the £1, which would be met by a 20 per cent, duty, whilst we know that the honorable member for Melbourne Ports over and over again called for a 30 per cent. duty.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– And was sorry he could not get a higher duty.

Mr CONROY:

– That ‘is quite true. The honorable member was sorry that he could not get a higher duty than 30 per cent. The honorable member contends that a man who produces 14s. worth of work should be able to make some one else pay j£i for it, and then he will be engaged in an industry. It is exactly the same thing to contend that a man in gaol who does 14s. worth of work, and whom it costs the State £1 to keep, is engaged in an industry. According to the honorable member for Melbourne Ports, the more people we have in gaol doing 14s. worth of work for which the State has to pay -£s, the bigger the industry. I have put the matter in this way in order that the honorable member for Melbourne Ports mav understand it, though I confess that I have no hope that the honorable member will understand it, because I remember that on one occasion he pointed out that if a farmer spent 1.5s. in putting in a crop, and did not get any harvest, he was 15s. better off than when he started. I remember that the honorable member also argued that if a man put in a crop at a cost of £1, and there was a return of 10s. from it, that made 30s. ; that there was 30s. worth of work done, and consequently the farmer was 30s. better off than when he started.

Mr Mauger:

– The honorable and learned member is dreaming.

Mr CONROY:

– Other honorable members believed that in such a case the farmer would have suffered a loss of 10s.

Mr Thomas:

– What was the honorable member’s argument about the glass bottle machine coming in free?

Mr CONROY:

– I believe that was one of those cases where’ it was contended that if there were a tax of 50 per cent., the man using it would have had to pay 50 per cent.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– The honorable and learned member forgets that the money remains in the country.

Mr CONROY:

– I am aware that honorable members opposite used that argument over and over again, until I showed them that they would be just as well off if they did not draw their pay because the money would still remain in the country. It then became plain to their bright intelligences that, after all, that was not a very sound argument to use, and we did not hear very much more of it. I may mention that when a duty was called for on sugar, honorable members opposite all said that the sugar industry was a magnificent industry. I believe that it is an industry, because it is a business that can stand on its own legs.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– The right honorable member for East Sydney thought that, and kept the duty on.

Mr CONROY:

– Surely the honorable member is not going to say that the right honorable member for East Sydney had anything to do with the Tariff.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I am speaking of New South’ Wales, and the right honorable gentleman’s efforts for the industry there.

Mr CONROY:

– The duty was cut down as much as possible in New South Wales, and but for the arrangements made for entering into the Federation it would have been cut down still further. I have never heard it alleged that every man who believes in free-trade necessarily believes in the total abolition of the Customs House any more than that every protectionist believes in the total prohibition of imports. If we use extreme language in the one case we must use it in the other; if we say that a free-trader means a man who would, abolish the Customs House, then we must say that a protectionist is one who would prohibit all exportation, because if we prohibit importation, we have nothing, to pay by way of exports. That, generally speaking, was my quarrel with honorable members on the Ministerial side in regard lo the sugar industry. Some of us believe this to be a true industry - that for every £1 spent in production, something of value will be returned. If the case be otherwise, somebody has to pay the difference, and it can only be paid by citizens engaged in productive industries. If we have socalled industries that cannot stand on their own legs, the bigger those industries are the worse it is for the community as a whole. Fortunately, the sugar industry is one which can absolutely rely on itself ; and yet what a miserable spectacle has been presented in this House in this connexion ! It has already been shown that the consumption of sugar in Australia amounts to something like 185,000 tons per annum; and an import duty of £6 per ton; has been imposed, evidently with the object of raising the price of the Australian product to that extent. I admit that there may be a difference in the price of, say, 2s. 6d., in order to prevent outside competition ; but the cost of carriage alone would have secured that end. Practically we have raised the aggregate price of sugar to the people of Australia by about £1,100,000.

Sir John Forrest:

– Was there not some duty imposed previously?

Mr CONROY:

– I am speaking about what might have been, had there been no Tariff. In Queensland, for instance, the duty was inoperative, and in Western Australia there was no duty.

Sir John Forrest:

– There was no duty in Western Australia for years.

Mr CONROY:

– In New South Wales, on the other hand, there was a duty of something like £3 per ton, and in Victoria a duty of £6. At any rate, it is clear that the effect of the Commonwealth duty will be to raise the cost of the sugar to the people as a whole by about £1,100,000. It was so clearly recognised that a large part of the duty ought to come back in the shape of revenue, that an excise duty was imposed which last year brought in, roughly, between £400,000 and £500,000. But even a certain amount of that return was lost, because we confused the matter by giving a bonus on sugar grown by white labour. No doubt we intended, as far as possible, to secure a White Australia; but, in passing, I must say that greater humbug, cant, and hypocrisy never were seen on the part of a Parliament than in this particular legislation. We have tried to persuade the whole of the people that this was wholly the legislation of the Commonwealth Parliament, whereas, .in fact, all of the States had previously passed laws restricting the immigration of aliens. Almost the whole of the States had. by 1898, so effectually made laws in this regard that from 1896 to 1901 only 700 aliens per annum found their way into the Commonwealth. The Commonwealth, with all its boasted legislation, did not prevent the alien influx, though this Parliament took credit for so doing. The view I have indicated could only be placed before electors who are ignorant of the facts, and I am bound to say that some of the legislators seem to be equally ignorant that restrictive legislation was years ago passed by the- States Parliaments.

Mr McDonald:

– In less than two years 2,000 Japanese came into Queensland.

Mr CONROY:

– Between 1896 and 1901 ?

Mr McDonald:

– I do not say that; but the honorable and learned member was speaking of a time prior to the Commonwealth legislation.

Mr CONROY:

– I think, as a matter of fact, that some 2,200 aliens came into Queensland, but of that number between 1,400 and 1,500 departed, and this brings the figures to what I stated in the first instance. When Queensland made a treaty with Japan, that State was much more alive to its duty than has been the Federal Parliament. I remember begging in this House that we should arrange for the exclusion of Japanese by a treaty with Japan ; and we know the letters which passed between the representative of Japan and our own Government. When I asked that this matter should be arranged in the fashion of statesmen, the honorable member for Bland interjected that perhaps I was afraid of war, and thought that we in Australia could not defend ourselves. What would the honorable member for Bland say to-day, when Japan has shown what it can do in a struggle with one of the mightiest nations in the world ?

Mr McDonald:

– Japan has backed down at the last moment.

Mr CONROY:

– If Japan has done so, it is more from a love of mercy than from any other motive; and I wish other nations had arrived at the same stage of civilization. In other countries, the men at the head of affairs know that not their lives, but the lives of those under them, are being sacrificed in time of war ; and the action of Japan is an example of sound consideration for those who fight the battle, and ought to be a lesson to European statesmen. The men at the head of affairs in Japan have taken part in the war, whereas in other countries the bulk of the statesmen manipulate affairs at such a distance that they could not be reached by the bullets of guns of the longest range. In my opinion it is not now even too late, to try to arrange a treaty with Japan ; and, whether we like it or not, we shall have to come to that step. We must learn to use the language of civilized nations when addressing the people of Japan, though, if we do use impertinent and boastful language, a great deal will be pardoned to us because of our ignorance, and our small size. But there are straining points after all, and to-day no one doubts that the very nation we chose to flaunt then could take possession of the northern part of Australia, and we should be absolutely helpless to defend it.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– What good would it be to them ?

Mr CONROY:

– It would be of great use to them, because a portion of that country is as rich as any part of Australia. It is not so suitable for a white population as for a population more inured to a tropical climate than we are.

Mr Tudor:

– Does the honorable and learned member say that Japan has a more tropical climate than Australia ?

Mr CONROY:

– No ; but I do say that the ethnological difference between the Japanese race and our own is so great that they seem to be better able to bear the conditions of a tropical climate than we are.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– What purpose could they put the country to if they took it for a few weeks?

Mr CONROY:

– They could make use of the country. The honorable member does not suppose that it is a desert.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– That pre-supposes the sweeping of the British Navy out of existence.

Sir John Forrest:

– Where would our navy be?

Mr CONROY:

– The Treasurer speaks of “ our navy “ after we clearly disregarded the very friendly warning from the British Government to arrange this business, as far as possible, by treaty. Was it not the height of stupidity and of ignorant arrogance to refuse to arrive at exactly the same result by treaty?

Mr Kennedy:

– Is the honorable and learned member in order, sir, in speaking disrespectfully of an Act of Parliament which he is not proposing to repeal or alter ?

The CHAIRMAN:

– The honorable and learned member is not in order in reflecting upon any action of this Parliament, and I trust that he will withdraw the expression he used. I would also ask honorable members to allow the honorable and learned member to continue his speech in his own way, and not to try to draw him off the thread of his argument by continuous interruptions.

Mr CONROY:

– I withdraw the expression. I am sorry that the honorable member for Moira thinks he was guilty of that ignorant arrogance, or arrogant ignorance; but I was referring to the .general tone of Parliament at that time.

Mr Kennedy:

– I object to the reflection upon Parliament.

Mr CONROY:

– The honorable member was one of those who voted in that way.

Mr Kennedy:

– That is why I object to the reflection upon Parliament.

Mr CONROY:

– The honorable member is not proud of his action, then. We absolutely declined to arrange a treaty. I suppose it is one of the few instances on record where a body of men who, when they could arrive at the same result in a courteous fashion, deliberately adopted the discourteous fashion.

Mr McDonald:

– Did any other Colony in the British Empire except Queensland do it?

Mr CONROY:

– No; and the fact that it did is a very high tribute to the members of its Parliament. By a treaty, Japan was willing to bind itself not to allow one of its citizens to come here, except with our approval, and we declined to entertain the courteous offer.

Mr McDonald:

– And the great bulk of them came into Queensland after the treaty was signed.

Mr CONROY:

– That is not correct.

Mr McDonald:

– It is. In the Queensland Parliament, we had a number of rows over the matter.

Mr CONROY:

– I took care to check the figures, and I think the honorable member will find that he is mistaken. Now that the little business with Russia is settled, if the Japanese statesmen should think it worth their while - and, for our own sakes, it must be hoped that they will not - they could compel us to do now what we declined to do then. Surely the honorable member for Moira does not think that Great Britain would interfere in a matter like this? We declined to listen even to the very strong suggestions courteously made by the Secretary of State for Colonial Affairs.

Mr Poynton:

– In framing the Immigration Restriction Act, we carried out the instructions of Mr. Chamberlain absolutely.

Mr CONROY:

– In one part of that measure we did. I certainly hoped that the Bill would not go through in that form, If a still more extraordinary clause had been inserted it would have had to’ be reserved for the Royal Assent by the GovernorGeneral, and then we should have had a measure drawn without any hurry-skurry, and representing the common sense mandate of the community, which was that, as far as possible, we were to preserve Australia for the people of our own Tace, but in doing so to come into conflict with other races as little as possible.

Sir John Forrest:

– Did not the honorable and learned member vote for total exclusion ?

Mr CONROY:

– I have just given the reason why I did.

Sir John Forrest:

– The honorable and learned member did not give that reason at the time?

Mr CONROY:

– I’ did. It would be far better for us to retrace our steps. It is very much more easy to amend an error in our own time and way than to wait until compulsion is placed upon us. We are apt to talk here in a very extraordinary way, indeed. At one moment men rise and say, “What do we care for England? Away with it.” If it makes a suggestion for the framing of a Navigation Bill, as it did, we will not listen to the advice. If it makes a suggestion for the framing of an Immigration Restriction Bill, as it did, we pay no attention. That is the way in which we treat suggestions from the statesmen of the old country. But the moment we are faced with trouble, by reason of our stupid folly, we turn round and say, “ We are safeguarded in our folly by the Fleet of Great Britain.” I do not care which way honorable members talk. If they say, “We will back up the British Fleet in everything they do,” I can understand that policy, but I do not understand the policy of condemning Great Britain for everything it does, and then turning round to whine and say, “ We must look to it to safeguard us in whatever we do.” Unfortunately, that is the position at which we have arrived. A time, however, may come when the statesmen of England will get very tired of that kind of thing, and think th’at we richly deserve one or two of the snubs we are bound otherwise to get. Does any one suppose for a moment that Australia would have talked to Germany about the Jaluit Group in the strain it did, or treat the representations of the Japanese Consul, when they were made, as it did, * had it not been for the fact that the power of England was behind us? We know that it could not have acted in that way, and as we are relying entirely on the protection of England, we should pay some heed to the representations made to us by the statesmen of that country. I should be very glad indeed, therefore, if the Ministry’ would face the situation, and prepare to arrange the treaty which was required by the Japanese Government. At the present time we do not stand in a very good position, so far as they are concerned, and it might be well for us to do what is desired before it is forced upon us. Of course, it may be that the Japanese nation, with its 44,000,000 of people, hardly takes the trouble to care what a small and remote country like Australia is doing. I have dwelt at some length upon this subject, because our legislation in regard to it seems altogether wrong, and I think that we should be prepared to recognise our position, and to act accordingly. In dealing with the sugar bounty, I shall point out the serious injury which its payment inflicts upon five States of the Commonwealth. As the honorable and learned member for Wannon showed, the bounty system places a very heavy tax on our orchardists, and the honorable member for South Sydney, who is largely interested in jam-making, has informed us that the heavy tax on sugar seriously injures that industry.

Mr Mauger:

– He is doing well.

Mr CONROY:

– That is not the question. We have to consider whether employment should be taken from thousands of people by the taxing of their raw material.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Employment has been taken from the boilermakers on the Yarra.

Mr CONROY:

– Does the honorable member therefore suggest that the farmers of the Commonwealth should not be considered? Let me give the Committee two instances of the serious injury done to industries bv the imposition, of a tax on their raw material. Mr. Chamberlain, in his intense desire to benefit the West Indian sugar-growers, and because the protectionist ideas which he has imbibed led him to think that it was not a good thing for England to get sugar cheaply by the operation of the French and German bounties, entered into negotiations which resulted in the stoppage of the importation of certain sugar, with the result that the price of sugar increased by £4 per ton. As a consequence, between 17,000 and 18,000 men connected with the confectionery trade, in which sugar is the raw material, lost their employment within twelve months, while the president of the Chamber of Manufacturers of Aerated Waters stated that that industry, in which 200.000 men were employed.’ had been almost totally ruined. Similar results, of course on a smaller scale, have followed in Australia through the action of the Commonwealth Parliament in putting a tax on sugar, which is the raw material of so many of our industries. But, altogether apart from the loss thus occasioned, the Commonwealth has to pay largely from the public funds for the maintenance of the bounty system, the cost of which next year will be increased °y 50,000. We are told that this arrangement was entered into to provide for a White Australia; but the Chinese Restriction Act was passed in New South Wales fifteen or twenty years before Federation, and almost all the States possessed similar legislation by 1898. There could be no more gross misuse of language than to pretend that there is any connexion between the sugar bounty and the maintenance of a White Australia. I will suppose, however, that what has been represented is absolutely the case. Men frequently tell us that the sugar lands are the richest in Australia, and we know .as a matter of fact that the land used for sugar-growing produces a rental varying from j£2 to £5 per annum. Will it be believed that the people of the Commonwealth who have to support themselves upon poorer tracts, are being required to contribute to keep in cultivation land so valuable that it is worth from £30 to £70 per acre? That, however, is what is absolutely being done. There is a confusion of language with regard, to this question that renders it almost hopeless to argue about it. What we have to determine is whether these rich and valuable lands shall be kept in cultivation by means of a bounty, and I say, apart from any question as to the employment of white or black labour, that we cannot escape the conclusion that the owners of these rich lands have no right whatever to any assistance from us. I am sorry that this argument has to be repeated so frequently in order to force it into the minds of honorable members. I think, Mr. Chairman, that we should have a fuller House. [Quorum formed.] I regret that the utter demoralization of honorable members on the Ministerial, benches should have necessitated my calling attention to the state of the House. I think that it is a monstrous thing that the Ministerial Party, which numbers forty-five, cannot keep sufficient members in the Chamber to maintain a quorum. The conditions under which the sugar industry is now being carried on are proving a serious hindrance to many other industries not yet fully developed in which sugar forms one of the principal raw materials, and I trust that honorable members will soon come to a reasonable frame of mind, and remove the present intolerable burden which the people of the Commonwealth are being called upon to bear for the benefit of a few planters and capitalists. Another matter to which the Treasurer referred demands our attention. All our public works are being constructed entirely out of revenue. While that principle is in many cases a sound one, and it may be specially desirable to follow it to a certain extent, owing to the fact that loan moneys have in the past been unwisely expended, we shall, by pushing it to an extreme, commit as grave an error as if we continued to spend loan moneys too lavishly. It is proposed to spend £30,000 upon the construction of a special telephone line between Sydney andi Melbourne, and it is anticipated that the revenue derived from, that addition to our telephone equipment will return something like 10 per cent, upon the outlay. It seems to me to be ridiculous to charge the whole of that expenditure to one year, and I can conceive of a number of works that would probably prove equally remunerative, which could fairly be paid for out of loans. We are making rather too great a call upon the revenue of any one year when we propose to construct such costly works out of revenue. If we pursue this policy too far, we shall be unable to proceed for twenty or thirty years with the construction of many desirable works which should be immediately put in hand. If we were about to build a railway - for example, the line projected from Kalgoorlie to Port Augusta - it is clear that we could not wait till we were able to construct it out of revenue. It is equally clear that the cost of many of our public works ought not to be debited to the single year in which they are carried’ out. It ought to be spread over a series of years. It may be that, in constructing the few public works which we have undertaken, out of revenue, we have acted wisely. But if we are to proceed with some absolutely necessary works which are connected with the departments under our control, it is obvious that in the near future we shall have to borrow. Unless the amount involved were very small, it would be ridiculous to borrow it within the Commonwealth, because by so doing we should merely produce a constriction in the money market which would re-act upon all the other producers in the community, and we certainly do not desire to achieve that result. During the course of his Budget speech the Treasurer made a most’ extraordinary statement. He d’eclared that since the establishment of Federation New South Wales had gained nearly £6,000,000. What he should have said was that since the inauguration of the Commonwealth that State had been taxed to the extent of an additional ,£5,900,000. The right honorable gentleman also stated that Queensland had Jost ,£2,000,000 during the same period. I admit that as the price of manufactures which, prior to Federation, Queensland was accustomed to obtain from New South Wales was enhanced by the operation of the Commonwealth Tariff, the people of the former State might very well be paying an extra amount of taxation without the money finding its way into the coffers of the Queensland Treasury.

Mr DAVID THOMSON:
CAPRICORNIA, QUEENSLAND · ALP

– Since the advent of Federation the Parliament of Queensland has been obliged to impose additional taxation.

Mr CONROY:

– When the Tariff was under consideration I pointed out exactly what would take place. The fact that a junior member of this House was able to foresee the result of its operation is in itself a double condemnation of the stupidity of the first Commonwealth Ministry and of their supporters.

Mr Austin Chapman:

– The honorable and learned member is too harsh.

Mr CONROY:

– How would the Minister like me to express it? I cannot say that they erred wilfully. I believe that they erred in honest ignorance, and consequently I have to say that their action was the result of stupidity.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– There is no other name for it.

Mr CONROY:

– At that time I went so far as to stake my reputation - as one who had some knowledge of political economy - on my prediction that the Tariff would fail in the very directions in which it has failed. Coming to the question of the deportation of kanakas, it seems highly probable - in the light of a decision by Mr. Justice Anglin, of Canada - that all our legislation in that respect must absolutely fail. Upon the third reading of the Pacific Island

Labourers Bill, and again when one of the Supply Bills was under consideration, I asserted that, in my opinion, that legislation would be ultra vires. I pointed out that, though we might put the kanakas on board a ship, with the idea of deporting them, the moment the captain got outside our territorial waters he would be holding those men as prisoners. Moreover, there was no need to make any such provision in regard to the deportation of kanakas, because they are a decaying race. That fact is clearer now than it was then.

Mr DAVID THOMSON:
CAPRICORNIA, QUEENSLAND · ALP

– Most of the kanakas desire to return to their islands, but cannot get back.

Mr CONROY:

– Those men were imported into Queensland upon the understanding that, at the expiration of a certain period, they would be returned to their homes. That arrangemenit should be respected in the case of those who wish to return. My remarks were directed towards those whom we propose to deport, irrespective of whether or not they desire to remain amongst us. To insist on removing those who were brought here unwillingly - irrespective of whether they liked it or not - would be manifestly unjust. If a thing is not morally right it cannot be politically right. In the history of all nations we find that any departure from that great principle has always been followed by disaster to those who inaugurated it. In dealing with a matter of this importance the Treasurer ought to have afforded us some explanation of what was likely to take place. I should like his attention for a moment.

Mr Watson:

– The honorable and’ learned member is filling in time very well.

Mr CONROY:

– Is not this a matter still requiring some consideration on our part?

Mr Watson:

– I should hope so; but I do not know why we should waste time now in considering it when the Bill will be submitted to us.

Mr CONROY:

– I wish the honorable member would not suggest that it is a waste of time to study the work of the Parliament or to indulge in just criticism of our own legislation. It is evident that there is some justification for a want of confidence in our legislation on the part of other nations. It does not seem as if the common sense of the people of Australia were uppermost, so far as our legislation is concerned.

Mr Carpenter:

– The honorable and learned member is again crying “ stinking fish.”

Mr CONROY:

– I am very sorry that the honorable member does not understand the difference between fair criticism and abuse.

Mr Carpenter:

– The honorable and learned member is decrying his own country.

Mr CONROY:

– I do not know whether the honorable member is a native of this country, but the bulk of the members of the Labour Party are not. It is a matter of no consequence whether he is or not, “but he has taken me to task for making statements regarding the country itself, when my criticism relates not to the country, but to the Legislature of the Commonwealth, and the want of knowledge which some of its members betray.

Mr Tudor:

– The honorable and learned member need not worry about that; no one else will.

Mr CONROY:

– I agree with the honorable member that I should “not worry. I have seen so many displays of a want of knowledge on the part of some honorable ^members that I ought to be satisfied that, unless I went around with the cane and recollected that, ‘ after all, many of them, so far as these matters are concerned, are as little boys at school, I could not hope to make any impression upon them. I am convinced from a knowledge of many of the honorable members of this House that it would be useless to explain the working of any legislation to them. If a severe schoolmaster who was in the habit of chastising boys for failing to comprehend a lesson after it had been explained three or four times to them, attended this House and saw how some honorable members were utterly unable to understand a matter that has been explained1 to them thirty or forty times, what punishment would he suggest ?

Mr Watson:

– If he had to listen to explanations of the kind to which we now have to submit, he would not think any other punishment necessary.

Mr CONROY:

– I do not ask the honorable member to listen to my explanation ; I only hope that he will be able to grasp it. Whether the people of other countries are rightly or wrongly imbued with the idea that we are not legislating on sound lines-

Mr King O’malley:

– That is our business.

Mr CONROY:

– But we cannot act altogether in defiance of the opinions of the rest of the world. If we wish to keep our place in the social life of the nations we are bound to pay at least some attention to their opinions. Who would have thought when we passed the Immigration Restriction Bill that its provisions would be applied to shipwrecked sailors? Many of the difficulties that have arisen under this measure have been due to defective administration.

Mr Mauger:

– What has that to do with the Budget?

Mr CONROY:

– It is a fit subject to be discussed at this stage.

Mr Mauger:

– It is played out.

Mr CONROY:

– Unfortunately, it is not.. While the memory of wrongs perpetrated under that Act remains, and opportunities offer to perpetrate other wrongs under it, no one can say that it is a subject with which we should not deal. I am referring particularly to the provision in the Immigration Restriction Act, under which certain aliens who were shipwrecked on our shores were not allowed to land.

Mr Watson:

– That myth was exploded long ago. Surely the honorable and learned member is not going to revive it.

Mr CONROY:

– I feel confident that if the Labour Government had been in office the Act would not have been administered as if men would deliberately court shipwreck in order to be allowed to land in Australia.

Mr Watson:

– That lie has been refuted a dozen times.

Mr CONROY:

– I regret to say that it has not. As a matter of fact, I saw a copy of a letter written by the Secretary of the Department of External Affairs “to the company acting as agents for the vessel to which I refer, in which it was stated that they were to exercise a special jurisdiction, so to speak, over the shipwrecked sailors.

Mr Watson:

– They were to be held responsible for their safekeeping, but subject to that condition they could land the sailors in Australia, and take them to any point they ‘pleased.

Mr CONROY:

– The Act was administered in connexion with that case as if men would deliberately choose to run the risks of shipwreck in order to evade its provisions.

Mr Watson:

– That statement is on a par with the general statement that has been made about the six potters.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– They do not like it.

Mr Watson:

– We do not like to hear lies about the six potters.

Mr CONROY:

– Is not the honorable member for Bland aware that the company was asked to take care that these shipwrecked sailors were not .allowed to remain in Australia. His silence gives consent. A more monstrous stretching of the law was never made. It was absolutely inhuman and disgraceful, and the work of the Administration in that respect was beneath contempt. I will go further, and say that when the Administration interfered under that very Act in order that halfadozen hatters should be blocked from landing for a time, it is no wonder that, considering that practically the same Administration holds office to-day, we should feel compelled to refer to the matter.

Sir John Forrest:

– The honorable and learned member is one of those who decry the country. He is one of the party that I referred to in my Budget speech.

Mr CONROY:

– I am stating what was absolutely done. I should like, to know why some of the very men who persist in retaining this legislation on the Commonwealth statute-book–

Sir John Forrest:

– Why did not the honorable and learned member try to get it repealed when his party was in office?

Mr CONROY:

– I was not in power; and if my voice had been of any influence, I should have urged that this was one of tlie. matters upon which it was absolutely necessary to legislate. I would sooner have gone down on this question than on anything else. I do not understand this warmth on the part of the members of the caucus party as to the effects of their own legislation. Why do they not get up to speak upon the Budget? Here is a great matter affecting the policy of the country, and they are so full of their own sense of want of knowledge that we have not heard a single word of criticism from them about it. They might be the most ignorant men alive, judging from the attitude they have taken up-

Mr Wilks:

– There is no “might” about it.

The CHAIRMAN:

– Order ! The honorable member must withdraw that.

Mr Wilks:

– Withdraw what?

The CHAIRMAN:

– The honorable and learned member for Werriwa said that certain members of this House “might” be the most ignorant men in the world, and the honorable member for Dalley said there is no “might” about it. He must withdraw that remark.

Mr Wilks:

– I want to know why the word “might” is considered disorderly?

The CHAIRMAN:

– I ask the honorable member to withdraw the remark.

Mr Wilks:

– I will not. I have said nothing that is disorderly. I cannot see that the word “might” is unparliamentary.

The CHAIRMAN:

– I point out to the honorable member that in the Standing Orders at page11 it is provided that order in debate shall be maintained; and it is also provided that when an honorable member is asked bv Mr. Speaker or by the Chairman to withdraw any statement, he shall do so. I consider that the honorable member for Dalley made a statement regarding honorable members of this House which reflects upon them, and I ask him to be good enough to withdraw it.

Mr Wilks:

– I did not say anything about the members of this House. I simply used the word “might.”

The CHAIRMAN:

– The word, in the connexion in which the honorable member used it, was, in my opinion, a reflectionupon honorable members ; and I ask him, as an old member of this House, with experience in a State Parliament, to obey the ruling of the Chair.

Mr Wilks:

– Since you, sir, have made such an appeal to me, I withdraw the remark, but I think we are becoming most supersensitive.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I rise to order. Do I understand that vou rule-

The CHAIRMAN:

– The honorable member must not discuss my ruling.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Most certainly I can.

The CHAIRMAN:

– The honorable and learned member for Werriwa will proceed.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– May I not dissent from a ruling? It is monstrous.

Mr CONROY:

– Judging from the silence of the members of the caucus party, they might be absolutely ignorant-

Mr Wilks:

– Is the honorable member in order in using the word “ might “ ? I have been placed in the ignominious position of being ruled out of order. Is the honorable member in order in using a word which you have ruled to be unparliamentary ? I want to have a fair deal in this matter.

The CHAIRMAN:

– In the connexion in which the honorable and learned member for Werriwa used the word, it is perfectly in order.

Mr CONROY:

– The members of the caucus party could, I say, be regarded as absolutely ignorant of all questions relating even to simple arithmetic, such as that two and two make four, judging from their silence. Perhaps the mass of the figures, which run in millions, perplexes them.

Mr Watson:

– No: what about the speech of the honorable member for Darwin ?

Mr CONROY:

– Of course, now that the honorable member for Darwin has been recognised as the financial authority of the caucus party-

Mr Watson:

– One at a time; we cannot produce all our authorities at once.

Mr CONROY:

– I confess that I listened with interest to the eloquent and touching part of his speech, when the honorable member referred to the meagre allowance made to him as a member of Parliament; but I did not altogether follow him in his financial statement. There was a part of it of which I thoroughly approve, and should like to try the experiment for myself. I refer to the passage in which he pointed out that borrowing money at 3 per cent., and lending it out at 7 per cent., would be a source of income. But he failed to point out, first, how we are to secure £6,000,000 at 3 per cent., and, secondly, how we are to lend out the money at 7 per cent. Probably it was my own fault that I failed to understand how the operation could be accomplished ; and while I give up any idea of putting the honorable member’s proposal into operation so far as millions are concerned. I should be very glad to avail myself of it in thousands, or even in hundreds, of pounds, if the honorable member were willing to advance the cash. All that it is necessary to do, it appears, in order to become rich, is to be furnished with a printing press and a bundle of old rags made up into good paper-

Mr Watson:

– That is nearly as good as the borrowing policy of the free-trade party in New South Wales.

Mr CONROY:

– Does the honorable member say that a policy of waste is a good thing for a country ?

Mr Watson:

– Does the honorable member say that the borrowing policy was not a policy of waste?

Mr CONROY:

– I wish I could say that I think the waste has been confined to one party, but it has been common to all parties. In the past, we have found those parties more inclined to economy who were on the side of free-trade, partly, I am afraid, from the simple fact that they were not able to obtain revenue to throw away.

Mr King O’Malley:

– Does the honorable and learned member think that an Australian building in London would be a waste of money ?

Mr CONROY:

– I presume that when a High Commissioner is appointed for the Commonwealth we shall have to find offices, and perhaps a residence for him. I see no provision in the Estimates for -any such expenditure. I shall, however, wait to debate that matter until the Bill for the appointment of the High Commissioner is before us. There are two other Bills before us to which I mav refer. The first is the Manufactures Encouragement Bill, and when I see that the Treasurer has made no provision whatever for the payment’ of bonuses under that Bill, it is clear that the right honorable gentleman does not expect that its provisions will be immediately brought into operation. I believe that in that view the Treasurer is perfectly correct.

Sir John Forrest:

– When you have a statutory provision, you do not require to repeat it on the Estimates.

Mr CONROY:

– But any expenditure under that measure must be provided for on the Estimates. If we are to accept Cogh! an ‘s figures, as soon as we begin to pay interest on the transferred properties, the whole of the revenue at the command of the Commonwealth Government will be absolutely swallowed up, and there will be none left for any of these administrative purposes. I have no hesitation in informing the people of Australia, so far as I can, that it is manifest that direct taxation will have to be resorted to unless a spirit nf economy is allowed to influence Commonwealth expenditure. I admit that some of the expenditure which must be met by the Commonwealth arises from the natural growth of population, and to that extent it has been quite unavoidable. But there are directions in which economy might be practised It is so perfectly clear to me that our expenditure has already exceeded the revenue which we can properly claim, that when the Manufactures Encouragement Bill comes before us again I shall feel bound to .move that none of the bonuses provided for under that measure shall be paid until the requisite sum has been raised by direct taxation. Then, with regard to the Commerce Bill, we are embarking on a. rather dangerous course of legislation in that connexion. I point out that the cost of administration of that measure will foe considerable, if it is to be administered in the way which has been suggested. When good wheat is worth 3s. 6d. per ‘bushel, I cannot see why we should prevent persons from exporting inferior wheat if they can get 2s. per bushel for it elsewhere.

Mr Watson:

– Has any one proposed to prevent them?

Mr Chanter:

– What objection can there be to branding it as inferior wheat?

Mr CONROY:

– It does not appear to me that there is any necessity to brand it at all. We haw only to let it go. I should have no objection to a refusal to put thu Government brand on it.

The CHAIRMAN:

– Order. The honorable and learned member must not discuss the details of that Bill.

Mr CONROY:

– I point out that as we are at present advised the cost of the administration of that measure would be so great that the Treasurer is bound to show where the money necessary for the purpose is to come from.

Mr Watson:

– I rise to a point of order. I wish to know whether it is in order to have a second reading debate on the Commerce Bill, the second reading of which has already been debated, or whether it is in order to refer in detail to any measures which have been before the House, and which are still under consideration ?

The CHAIRMAN:

– I called the honorable and learned member for Werriwa to order, and I understood that he was proposing to obey my direction. It is not in order for any honorable member to anticipate a debate set down for a particular day ; nor is it in order for him to refer to the details of measures that are not before the Committee.

Mr CONROY:

– I thoroughly understand the ruling, and considering that my references to these measures did not occupy more than about a minute, the honorable member for Bland would appear to be extremely sensitive on the subject. I always understood that the reason the caucus party would not accept any portfolio this time was because they were conscious that they had failed so lamentably, that they did not intend to expose themselves to the ridicule of the public on a second occasion.

The CHAIRMAN:

– The honorable and learned member is not in order.

Mr CONROY:

– I think I am entitled to discuss such questions in dealing with the Budget statement. After all, if Ministers can expect little consideration for their statements or their works, from honorable members on this side of the House, they have, at least, the gratitude and support of honorable members in the caucus corner. The Ministry have undertaken work which the twenty - eight members of the Labour Party find themselves unable to do, although I he supporters of the Ministry number only eighteen honorable members. A more miserable confession of incompetence was never made by any political party in the world. Although some of the Labour Party have had previous experience in office, they confess that they cannot find amongst themselves men capable of drafting, or even understanding, a single measure to submit to the House.

Mr Watson:

– This is another sample of opposition argument !

Mr CONROY:

– Will the honorable member for Bland explain how it was that his party of twenty-eight honorable members gave way to a party, of eighteen?

Mr Watson:

– It is no use making an explanation to a member of the density of the honorable and learned member for Werriwa.

Mr CONROY:

– -Why should, the Labour Party have stepped aside, except on the ground that they are incompetent? Although the measures that have been introduced have involved much litigation in the past, and will, probably, involve much litigation in the future, there is no provision made in the Estimates for the appointment of. additional Judges. I was distinctly opposed to the judiciary Bill, for the reason that in my opinion the law courts, as they then existed, were able to cope with all the business. But Parliament thought otherwise, and, that being so, I was prepared to agree to the appointment of ‘ five Judges, because I was firmly convinced that three would prove insufficient. As a matter of fact, when we were considering the clauses giving the High Court original jurisdiction, clauses against which I voted, because of the extra Judges bound to be required, I expressed the opinion that there would be required at least seven Judges to start with ; and now it is plain, from the number of cases set down in New South Wales and Victoria, that additional Judges are absolutely requisite if delays in appeals are not to be so great as to create the chao.tic state of the American Court.

Mr King O’malley:

– Does the honorable and learned member not think that the High Court has justified its existence?

Mr CONROY:

– I am not discussing that question. What we have to consider is whether there are sufficient Judges, and I unhesitatingly say there are not. It is far better that a Judge should be idle than that a suitor should be delayed in justice for even a single day. The Ministry will have to take this matter seriously into consideration, because, in my opinion, it is; one which calls for legislation, even this session. If the number of Judges was increased immediately, some time must elapse before the enlarged bench could get to work. We ought to appoint at least two additional Judges, though I am doubtful whether that would prove enough. As a rule, it is not popular to insist on the appointment of Judges. People have regard to the salaries which have to be paid, but not to the fact that if the salaries are not paid, the best men cannot be obtained for the position. At the present moment delay is taking place in the hearing of appeals, and the Government, in declining or omitting to provide additional Judges, are not placing the High Court in the position it ought to occupy. We have to bear the consequences of our legislation, and if we do not appoint additional Judges to interpret the law, and bring it. as it were, up-to-date, a still more serious state of affairs will arise. It ought to be the duty of every Parliament to see that there is a sufficient number of Judges, whether in the major or minor courts, to insure that there shall be no delay, which, as every one with a knowledge of the law is) aware, is the chief cause of expense. Another matter with which we are called upon to deal is that of preferential trade. Freetraders throughout Australia could not but welcome an extension of trade with the mother country if it means a removal of the duty. Such an extension would mean the market in that part of the Empire, if nothing more; and when the Prime Minister says at one moment that he is in favour of preferential trade, and the next moment declares for fiscal peace, a situation is created that would puzzle the. proverbial Dutchman. I do not understand his statements at all.If peace means anything, it means rest from conflict ; and when the honorable and learned member spoke of fiscal peace he certainly meant a rest from fiscal disturbance. But that could not be the case if we were to have preferential trade. I have never understood that a law was requisite to induce any man to indulge in preferential trade, when the preference was on his side. Nor is it necessary even now. It is the veriest humbug to pretend that a law is required to give effect to preferential trade when the preference is in our favour. Trade is only carried on now when it is in favour of the trader. If preference means anything, I suppose it means giving an advantage to one over another. We shall always take the advantage when it is on our side. Our efforts are invariably devoted towards seeing how we can get the preference in trade. If Mr. Chamberlain, who I believe is largely interested in a screw combine, would sell his screws to me 5 per centmore cheaply than to a foreigner on the Continent, he would give me a practical proof of his belief in preferential trade, of which I should only too gladly avail myself. It is true that at the next moment I might sell the goods to the foreigner, if he was willing to buy them. But what have we in Australia to offer in return ? If, of course, we could get as an exclusive market for our goods the 40,000,000 persons in Great Britain, no doubtevery one of us would welcome it. One does not need to be a free-trader or a protectionist to see the big advantage it would give us. But does any one honestly think that there would be such a general dementia amongst the people of England that they would be willing, in order to get 5 per cent. of their trade, to give up 90 per cent. ?

Mr Wilks:

– In England the genuine Labour Party are against preferential trade.

Mr CONROY:

- Mr. Chamberlain’s first attempts at regulating trade have proved so disastrous that, as I explained earlier in the evening, they drove between 17,000 and 18,000 out of employment in one trade, and nearly ruined the whole employment in another trade affecting 200,000 employes.

I can quite conceive that, under these circumstances, men who have had any knowledge of his efforts in the past are not likely to attach much credence to his opinions in the future. If the Prime Minister really believes in this doctrine, he need not go to England to indulge in it, because, as a farmer, I shall always be ready to exchange dry cows for milch cows, or lean porkers for fat porkers. I do not mind carrying on that system of preferential trade as long and as often as he is willing to indulge me.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Let the Treasurer show by his figures that the trade is following the flag.

Mr CONROY:

– We are all aware that, to a very large extent, trade does follow the flag, without any forcing. It is quite a natural growth, because men will rather trade with those with whom they have been accustomed to trade, and in whom they have confidence, than with men who are further away. So far from foreign trade being less beneficial to a country than other trade, it is sometimes the most profitable of all. If it were not for the extra profit to be derived therefrom men would not indulge in the foreign trade.

Mr Wilks:

– What does the honorable and learned member think about the contribution to the Navy?

Mr CONROY:

– I do not like to dwell very much on the question of defence. I view with a considerable amount of dismay thevery great tendency there is to increase our military vote. In view of some of our actions, and the great unwisdom, and certainly the great arrogance, with which we try to dictate to other nations what is to be clone, millions would not be too much to be spent on defence. But the question, so far as the great mass of the people is concerned, is. Would it not be far better to give up talking in an arrogant, unstatesmanlike way, and try to follow the paths which lead to peace? Then there would be no need for us to attempt to make the military display we seem bent upon doing. Wemust remember that the Commonwealth is asked to contribute £1,021,000 this year. If we do not mind we shall be paying too high a price for our insurance. The tax which the people are to be called upon to pay is far too high, and there is always a tendency on the part of military men to stretch the expenditure. I happen to be one of those who have never had a very great regard for the military spirit in men.

Mr Webster:

– And’ yet the honorable and learned member is said to possess thf» martial spirit.

Mr CONROY:

– I have always thought that it is a very inferior spirit. In the military service we sometimes meet with some very good men, but as a rule we cannot expect the best men to take to that life, because it does not lead to anything. Their greatest hope is to die gloriously. When a man has that particular bent of mind that he hopes to die gloriously, he cannot be expected to pay that attention to mundane affairs which he ought to do. Therefore, we cannot expect our best brained men to take to a military life. When so many other avenues of employment are open, it would be ridiculous to expect men to do so ; and even if they were very Brainy men, and possessed the martial spirit to a certain extent, they t would recognise that it could not lead to anything. Because, so far as Australia is concerned, there is little or no hope of advancement. Therefore, as a rule, the advice we get from military men is not likely to be very sound. All the improvements which have been made in munition and armament have almost, without exception, been due to civilians, and not to soldiers. If I wished to make an indictment against military men as a rule, I could not make a stronger one than that, because to my mind it absolutely disposes of all belief in their ideas. We cannot expect from men who have not been able to introduce any of the great improvements which have been made in munitions or armament any really sound ad’vice on matters like this. They, no doubt, possess a blind, dogged resoluteness which covers a multitude of sins ; but I hold that the man whose only virtue is that he is willing to let himself be shot down is not the best citizen, and that those who wish to see the military system perpetuated, are not the best advisers for the country. We should be very careful before accepting counsel from them. I would remind the Committee that much of the money spent on defence is, after all, merely money thrown away, and if the annual expenditure in this direction is to be very large our taxation will be so seriously increased that the poverty which ‘it will create will cause the death’ of more persons than would be killed by half-a-dozen years of protracted warfare. It is true that they would not be killed outright, and their deaths would therefore not excite so much sympathy as is occasioned by deaths on the field of battle, but the sum total of misery would be greater. We should consider this question from the point of view of the masses, who have to pay the taxes which we impose. ,£1,000,000 a year would furnish employment for 10,000 men at £100 each, and if the money was spent in inducing population to settle here, or in ways that would give us a fuller measure of prosperity, the community would soon be in a better position to resist aggression than it will be in by the adoption of the proposed system of defence. I admit that provision must be made for rifle corps, and it is perfectly clear that artillerymen and engineers cannot be trained in a single day, while untrained men cannotbe expected to do what trained men can do. But as the honorable member for Wentworth has pointed out, is it not clear that our first line of defence is the Navy of Great Britain? While it remains intact it is impossible for our land defences to be called on. Probably .£200, 000 or £300,000 could be saved in our defence expenditure. We should not embark on an extravagant outlay, which will result in the fostering of a spirit of militarism which cannot benefit the community. A few hundred men armed with rifles could prevent the landing of any naval force, and, if experience has proved anything, it is that, troops cannot.be landed except at a safe place. Half-a-dozen torpedoes would prevent vessels from entering Sydney Harbor. It is true that the city might be damaged by shell fire, but the damage so done would not be equal to the loss occasioned1 to the community by excessive taxation, because bv taxing production we hamper industry. The Commonwealth has increased the amount raised from Customs and Excise duties from £7,000,000 to ,£9,000,000, and still more is paid by the people than goes into the Treasury. Is it any wonder, then, that our progress has not been what might have been expected ? However, good seasons are apparently setting in again, and if they come Australia will go ahead, despite the hindrances to industry imposed by her Legislatures.

Mr CULPIN:
Brisbane

– I should like to refer to the remarks which have been made by certain speakers which seem to propose the establishing of a new industry. We have heard nothing to justify the assertion that borrowing is to be a new industry, though the honorable and learned member for Corinella seemed to favour borrowing, in order to put our defences on a proper and efficient footing. But whilst there has been no general statement in favour of borrowing, the desirability of that course has been suggested, and we may infer that loans will be raised when we come to deal a little more directly with the States debt question. The Queensland Government have devised means by which they can obtain money without any expense to the taxpayers, and make use of it in much the same manner as if it were actually borrowed. In connexion with the Treasury, they have a Department in which a large amount of money has accumulated, and they have recently devoted £400,000 of these funds to the purchase of their own debentures.

Mr Deakin:

– Is that in connexion with the Treasury note issue?

Mr CULPIN:

– Yes. The Queensland Government have £800,000 which has for some time been lying idle, but they are now making use of it from time to time. If the Treasurer of the Commonwealth could devise some similar scheme, we should not require to consider the question of borrowing money in the London market. The honorable member for Dalley interjected whilst I was speaking upon a subject allied to the topic I am now discussing, “ More shin plasters.” The honorable member had been “ stone-walling “ for some time prior to the period at which he made his interjection, and, as his condition must have been very painful, probably the application of a few shin plasters would have done him good. The Queensland Government are to be congratulated upon having carried out the scheme to which I have referred, and I should be glad to see the Commonwealth adopt some similar means of raising the money necessary to meet our immediate requirements.

Mr Crouch:

– Does not that amount to borrowing money ?

Mr CULPIN:

– No. If people come to you, and offer you money in exchange for a piece of paper, it is only reasonable that you should accept it. That is the course pursued in Queensland. I hope the Treasurer will give the . matter his most serious consideration. I thoroughly approve of the proposal to extend the sugar bonus for a further period of five years. The statement made by the Treasurer upon that subject was one of the most gratifying that could greet the ears of the representatives of Queensland. I believe, if the bonus is continued, the sugar industry will become more prosperous than ever, and that the production will increase to proportions hitherto unknown. I shall strongly oppose any proposal on the part of the Commonwealth to borrow money, and I believe that themembers of the party to which I belong will view it with equal disfavour. I trust that the improvements in the Defence Department will be of such a nature that we shall obtain something good in the way of defence. At the same time, I hope that the necessary funds will be obtainable without resort to borrowing.

Progress reported.

page 1713

ADJOURNMENT

Conduct of Business

Motion (by Mr. Deakin) proposed -

That the House do now adjourn.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I feel that I ought to offer my congratulations to the Government upon their new departure to-night. It is only a very small one, but it promises more as it grows, I presume. I hope that we shall benefit by the wealth of wisdom to which we have listened during the past few minutes.

Mr Watson:

– During the past few hours.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I venture to say that a series of speeches have been delivered from this side of the House to-night which will well repay anybody’s perusal in Hansard.

Honorable Members. - Oh, oh.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Honorable members may laugh, but I venture to think that it is a vacant laugh. At any rate, we had a deliverance upon defence questions to-night such as we have not listened to heretofore. For the first time we begin to understand what defence matters really, mean. We have had a speech from the Treasurer, supplemented by no statement from any other Minister, and therefore we have heard no deliverance of policy concerning any of the supreme matters which are engaging the attention of Australia at the present moment. Who knows anything about defence matters from anything which the Government have made known to the Committee during the course of this debate ? Who can say that we have learnt anything in reference to the transfer of the States debts from any statement which has been made by the Ministry during the Budget discussion ? Upon the other hand, speeches have been delivered from this side of the Chamber which merit a statement from the Government, both in regard to their defence policy and the question of taking over the States debts. Yet. this silence is apparently what the country is to be treated to, because those speeches have been delivered. I admit that during the past few weeks it has become almost a crime in this House to speak at all. * It seems to me that the way in which business is to be done now is by means of a Star Chamber. I think it is about time that we entered some protest against the manner in which business is being conducted in this House, and against the scandalous way in which honorable members are neglecting their duties.

Mr Carpenter:

– Against the scandalous way in which the honorable member is behaving.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– It is time that we protested against the way in which members of the Labour Party are constantly absent from the House. No doubt they are doing their business away somewhere out of sight - issuing their instructions to the Government in much the same fashion as the Czar issues his ukase to the people throughout the length and breadth of his dominions. Parliamentary government seems to be on the decline absolutely. And we are now told that we are obstructing business, and “ stone- walling.”

Mr Webster:

– Hear, hear.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– That interjection comes very aptly from an honorable member who used to drivel here for five hours at a stretch.

Mr Webster:

– I know-nothing about the game of “ stone- walling,” and I admit it!

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I venture to say that there has been nothing but legitimate debate during, the whole of this evening. A set of informing speeches has been delivered, for which, the House and the country will be the better. At any rate, they have been a valuable contribution to the solution of those great problems which are now causing deep anxiety throughout the length and breadth of Australia. I congratulate the Government upon having begun this penalizing process.

Mr WATSON:
Bland

– I must say that the indignation of the honorable member who has just resumed his seat is extremely amusing to most of us who have any memory of what has occurred in the

House during the past week or so. I say that since the House met, after the Ministry assumed office, we have had nothing but obstruction and stone-walling on the part of honorable members ‘on the Opposition side of the Chamber.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The honorable member might as well make that false statement as any other.

Mr SPEAKER:

– Order. I must ask the honorable member to withdraw that remark.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I withdraw it, and I will say that the statement of the honorable member is absolutely inaccurate.

Mr WATSON:

– Does the honorable member seek to impose upon those who are here the impression that a number of the speeches delivered from the Opposition side of the House have been anything but’ in the nature of stone-walling tactics? Has there been the slightest appearance of earnestness on the part of the greater number of those who have spoken ? Has there been anything but a deliberate attempt to stop the transaction of business, and to prevent this House and the Government from getting any credit for doing what: we are here to do?

Mr Conroy:

– That statement is absolutely untrue.

Mr SPEAKER:

– Will the honorable and learned member withdraw that statement ?

Mr Conroy:

– I suppose I must ; ‘ but the honorable member for Bland should not make statements of that character.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I rise to a point of order. Is the honorable member for Bland in order in charging members of the Opposition with deliberately obstructing the transaction of business?

Mr SPEAKER:

– If the honorable member holds the opinion ‘attributed to him, I think he was perfectly, in order in’ expressing it.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Do I understand you to rule that an honorable member may charge other honorable members with deliberately obstructing the progress of business ?

Mr SPEAKER:

– The honorable member for Parramatta must remember the speech which he has just delivered. He made certain remarks, to which any other honorable member is fully entitled- to reply ; and it seems to me “that the only possible way in which one could reply to them was either by admitting the charges which he made, or by contradicting them. The honorable member for Bland is contradicting them, in terms as parliamentary as he can possibly employ under the circumstances. He would not be in order in making the remark attributed to him, if it were not for the charges made by the honorable member for Parramatta.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– H do not think that you should reflect upon my remarks in that way.

Mr SPEAKER:

-I am not reflecting upon the honorable member’s remarks. They were in order, otherwise I should have called, his attention to the fact. But there are only two ways in which his speech can be replied to, namely, either by admitting the charges made, or bv contradicting them1. The honorable member for Bland has contradicted them.

Mr WATSON:

– Honorable members profess to be highly indignant at being charged with having adopted stone-walling tactics. I was not here last week, but I am free to stay away as I please when I do not wish to listen to the uninteresting drivel that proceeds from the Opposition.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The honorable member is a good judge of drivel.

Mr WATSON:

– I profess to be able to judge that which comes from the honorable member.

Mr Wilks:

– The honorable member will not gain anything by bullying.

Mr WATSON:

– I shall not submit to bullying on the part of the honorable member.

Mr Wilks:

– We shall see about that.

Mr WATSON:

– The honorable member will find that I am not to be bullied bv himself or the deputy leader of the Opposition.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Why cannot the honorable member allow the Government to reply ?

Mr WATSON:

– The honorable member saw fit to attack the party of which I am a member, and now his sense of fair play is such that he objects to my offering a reply ?

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Why should the honorable member rush in?

Mr WATSON:

– Why did the honorable member drag me into the discussion? As the honorable member persisted in referring to the Labour Party, I surely had a right to reply. Apart altogether from the position of the Government, every honorable member has an interest in seeing the busi- ness of the country conducted with sufficient expedition to insure the passing of at least some legislation.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The honorable member has never shown anything of the kind.

Mr WATSON:

– As one of those who supported a State Government of which the honorable member for Parramatta was a member, I often remained in the Chamber till the small hours of the morning to assist in keeping a quorum to enable business to be transacted.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Let us come back to the position of affairs last session.

Mr WATSON:

– The honorable member cannot point to any obstruction ‘on my part. I have the statement of one whose word he must accept - the statement of the leader of the Opposition - that he never received fairer treatment from an Opposition than that which my party had afforded him while he was in office.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I do not believe it.

Mr WATSON:

– I regret that the honorable member should be in such a frame of mind that he cannot believe-

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I simply mean to say that I think the honorable member is mistaken.

Mr WATSON:

– I repeat that the statement in question was made in the House by the right honorable member for East Sydney, and was repeated by him a few minutes later in another place. The honorable member may satisfy himself on that point at another time. The week before last there was distinct obstruction and stonewalling on the part of the Opposition.

Mr Kelly:

– By whom?

Mr WATSON:

– The honorable member for Wentworth was one who was guilty of these tactics.

Mr Kelly:

– I rise “to a point of order. Is the honorable member in order, Mr. Speaker, in saying that I stone-walled any measure? 1 have given no cause for such a statement.

Mr SPEAKER:

– There can be no doubt at all that the use of strong language on either side does not conduce to the conduct of the debate on proper lines, but rather tends to embitter the feelings of honorable members. At the same time, I have ruled, and still rule, that the honorable member for Bland is not out of order in making these remarks.

Mr Kelly:

– It only means that it will be necessary for me to reply.

Mr WATSON:

– I repeat that the remarks made by several honorable members on Thursday week and Friday week were palpably with the object of filling in time, Several of the speeches to which we have just listened have been of a similar kind.

Mr Wilks:

– On the Budget?

Mr WATSON:

– No. I can take no special exception to the speeches to which we have listened to-day ; but can any one say that the remarks of the honorable and learned member for Werriwa were made with an earnest desire to advance the discussion ?

Mr Conroy:

– I should hope they were.

Mr WATSON:

– If -that was their object they failed lamentably.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– That is a matter of opinion. It was a better speech than the honorable member could have made.

Mr WATSON:

– I have never pretended to be able to make a speech, so that I am not hurt by the honorable member’s suggestion.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– But the honorable member thinks he is able to criticise one.

Mr WATSON:

– I have sufficient experience of parliamentary procedure to be able at least to recognise when an honorable member is addressing himself to the subject at issue, and when he is simply filling in time. The object of the Opposition has been palpable to every sensible man in the House.

Mr Lonsdale:

– When the Labour Party were in Opposition, was there nothing palpable?

Mr WATSON:

– On one or two occasions there was something in the nature of stone- wal ling.

Mr Lonsdale:

– There was far more stone-walling than has been indulged in by the present Opposition.

Mr Wilks:

– What about the five hours’ speech made by the honorable member for Darling ?

Mr WATSON:

– The honorable member for Darling and one or two others confess that they are mere infants in the art of stone-walling as compared with the honorable member for Dalley and others who glory in the assertion that they can talk for hours without really saying anything.

Mr Kelly:

– No one has ever made such long speeches as the honorable member for Darling and one or two others have done.

Mr WATSON:

– The air was full of complaints as to the time occupied by the honorable member for Darling and one or two others in making speeches of the kind to which I have referred. The honorable member for Parramatta has alluded to the absence of the members of the Labour Party from the Chamber. It might have been as well for him, first of all, to account for the absence of the Opposition. Honorable members of the Opposition profess to have such an intense regard for the business of the country that it cannot be transacted in their absence, and yet, with the exception perhaps of three or four of their number, they are nearly always absent.

Mr Kelly:

– The honorable member has just been complaining that we are too much in evidence.

Mr WATSON:

– I say that we could probably do with the absence of a few more to the satisfaction of the country, but it is surely an extraordinary complaint on the part of those who are almost always absent that others are occasionally away from the Chamber. I do not regard myself as under any obligation to remain here and listen to speeches which are purely of an obstructive character. So far as the speech made by the honorable member for Corinella was concerned, I may say that I listened to a great portion of it with much pleasure. It was a speech addressed to the subject under discussion, and one to which no one could listen - even if one did not wholly agree with the conclusions expressed - without being extremely interested. I for one should be glad indeed to give every attention to any other speech of that character.

Mr Mcwilliams:

– No stone-walling took place last week on the Manufactures Encouragement Bill.

Mr WATSON:

– I was not here last week, but, judging from what I have read in Hansard, I am inclined1 to believe that the tactics adopted on a prior occasion were not departed from in the slightest degree.

Mr Mcwilliams:

– The honorable member should ask the Prime Minister.

Mr WATSON:

– Another statement is that the speeches made by the Opposition call for replies.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I did not say that.

Mr WATSON:

– We are frequently told by the Opposition that there is a conspiracy of silence on the other side of the House. I have a fairly clear recollection of what occurred when last year’s Estimates were under discussion, but I do not (remember that the late Government ireplied to every statement of the Opposition. I do not remember even the honorable and learned member for Corinella, who was then Minister of Defence, saying one word about the policy of the Government, nor can I recollect any member of the Government discussing any matter of policy which the Treasurer had put forward in his Budget statement. Now, the honorable member for Parramatta is consumed with anxiety to learn what is the Government policy on every imaginable subject. When the late Government was in office, however, he was as quiet as a dumb driven sheep.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Does the honorable member forget the amendment on the Estimates which . was submitted by the honorable and learned member for Indi, who was a member of the alliance ?

Mr WATSON:

– That has nothing to tlo with the attitude of the honorable member. He is now complaining that he can obtain no indication of the Government policy, although twelve months ago he was quite satisfied that the Government of which he was a supporter should make no such communication to the House.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The honorable member is making an incorrect statement.

Mr WATSON:

– I see no evidence of that. I should like the honorable member to show in what respect my statement is incorrect.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I assert that nearly . nil the members of the late Government spoke when last year’s Estimates were under consideration.

Mr WATSON:

Hansard does not show that they did.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– It does. The honorable member is mistaken.

Mr Wilks:

– The honorable member for Bland is “ belling the cat “ for the Government.

Mr WATSON:

– The honorable member is experienced in matters of that kind.

Mr Wilks:

– Even if the honorable member is prepared to stand godfather to the Government, there is no reason why he should act as stepmother to the rest of the House.

Mr WATSON:

– I am concerned, not with the disorderly interjections of an honorable member who is noted for his facility in “ stone-walling,” but with those of the deputy leader of the Opposition, who has deliberately accused the Labour Party of neglect of duty in remaining away from the House. As far as possible, I shall be always prepared to assist in keeping a quorum.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The point of my criticism is that the Labour Party remain out of the Chamber most of the day, and then come in and try to make us sit after the usual hour for adjourning.

Mr WATSON:

– It seems to me that if honorable members go beyond what is. reasonable criticism and discussion, with a view of arriving at the best results, we should be prepared to take steps to arrive at a proper conclusion. I am prepared, for one, to do all that is practicable to that end ; and I trust that a majority of honorable members will do the same, so that we may bring about such a result that at the end of the session we shall have something to show to the country as a consequence of our sitting so long.

Mr CONROY:
Werriwa

– I regret to hear the remarks or the honorable member for Bland. I have never heard him deliver such a statement as he has made to-night. I am sorry that his nervous system has broken down, and- 1 impute it entirely to excessive train travelling. Let us test the statement he has made. This is the second night of the Budget debate, and although something like a dozen members of the Opposition have spoken, no reply has been made on the part of the Government. The honorable member spoke of my speech of two hours as being in the nature of “ stonewalling.” When I wish to “stone-wall,” especially on a Budget, not two hours, but rather twenty, would be a fair allowance for me. I am very sorry that the honorable member for Bland should have departed from that usual good temper and affability that he displays, and should have made such strong accusations.

Mr WILKS:
Dalley

– I have never heard a man in parliamentary life play the scold as the honorable member for Bland has just done. . What is the true position of affairs? During the last two nights ten members, belonging to the various parties, have spoken in Committee on the Budget statement. To-night the debate was commenced by the honorable member for Darwin, a strong supporter of the honorable member for Bland. He spoke for an hour and a half. Does the honorable member call that stone-walling? The honorable member for Darwin was followed by the honorable and learned member for Corinella, whose speech on defence no honorable member who heard it would characterize as a stone-wall. Was the honorable and learned member for Wannon stone-walling, when dealing with the States debts question? Even the Prime Minister would not .cavil at his speech. So that apparently the honorable member for Bland levels all his charges at the honorable member for Werriwa; but he was followed by the honorable member for Brisbane, who dealt again with a subject on which he has only recently made a long speech.

Mr Watson:

– The honorable member for Brisbane spoke for only ten minutes.

Mr WILKS:

– Of course, the honorable member for Bland has nothing to say against one of his own supporters. Last night the first speaker was the honorable member for South Sydney, who occupied time mainly in dealing with the sugar bounty question, but was he stone-walling ?

Mr Watson:

– I have hot said so.

Mr WILKS:

– Is the honorable and learned member for Angas, who followed him, ever guilty of obstructive tactics ? He dealt seriously with some very important questions. I “will say nothing pf the speech of the honorable member for Lang, lest I offend the honorable member for Bland; but in making it the honorable member was only doing what he believed to be his duty to his constituents, and to the State which he represents. The next speaker was a Government supporter, the honorable and.,learned member for Northern Melbourne, and an ex-Minister of the Labour Government, who advocated the abolition of the Braddon provision. Was he stone-walling? Then followed the honorable member for Wentworth on defence. I can understand now who are inspiring the paragraphs . which have appeared in the newspapers this week’ and last week.

Mr KENNEDY:

-May I direct attention to the need for a .quorum?

A quorum not being present,

Mr. Speaker adjourned tac House at 11 41 p.m.

Cite as: Australia, House of Representatives, Debates, 30 August 1905, viewed 6 July 2017, <http://historichansard.net/hofreps/1905/19050830_reps_2_26/>.