2nd Parliament · 3rd Session
Mr. Speaker took the chair at 10.30 a.m.
LIEUTENANT A J. RUSSELL.
Mr. HUTCHISON asked the Minister representing the Minister of Defence, upon notice -
a. Is there a different code of honour in the Commonwealth Forces for commissioned officers and for non-commissioned officers?
Mr. DEAKIN. - The answers to the honorable member’s questions are as follow : -
Conduct to the prejudice of good order and military discipline in that, on the 24th February,1906, although repeatedly called upon, and, after promising to do so, he failed to account for, or produce, the sum of £10 18s. gd., the property of the officer commanding the nth Australian.- Infantry Regiment, which failure - necessitated action being taken in the Police Court, Perth, in order to recover same, such - recovery being obtained in consequence of an order of the Court, mnde on the 7th March, 1906.
He was found guilty, and sentenced to be discharged with ignominy.
With regard to Lieutenant A. J. Russell, of the Western Australian Infantry Regiment - a cutting from the Sunday Timet, of Western Australia, commenting on the expulsion of Mr. Russell from the Perth Stock Exchange was brought under the notice of the Minister, who referred it to the Commandant of Western Australia.
The Commandant, in reply, stated that he had been watching the case very closely, and had been informed that Mr. Russell has instituted proceedings against the Sunday Times, and recommended that no action be taken until such time as the Court has given judgment.
Mr. Hutchison. - He was expelled from the Stock Exchange.
Mr. DEAKIN. - I understand that that was in consequence of a statement published in the newspaper against whose proprietors he is bringing a, libel action.
asked the Postmaster-General, upon notice -
Whether he will supplement, the information already given as to the loss in each State on the adoption of penny postage, by a statement showing the number of letters, in each case, to which the loss applies?
– Yes ; the information will be furnished on Tuesday next.
– I move -
That, until otherwise ordered, the Order of the House giving precedence to General Business on each Thursday until half-past six o’clock be suspended, and that Government Business shall have precedence on each day of sitting.
There are but a few weeks left in which to transact a great deal of important business, and while many questions of magnitude are raised bv the notices on the business-paper in the names of private members, if our time is insufficient for the transaction of Government business it must be impossible to dispose effectively of their business. They are, therefore, not being asked to sacrifice real opportunities. If we are to do the work which remains to be clone this session, and go to the country as early as is desired there remains but a very short time in which to do it.
– If an opportunity to deal with private members’ business presents itself, will the honorable and learned gentleman allow us to take advantage of it?
– Of course.
.- At this stage of the session the proposal of the Government is a perfectly justifiable one, especially in view of the lamentable condition of the artisans in the foundries of Victoria. The Attorney-General about Christmas time drew a most affecting picture of the miserable state of the firesides of Victoria for want of a relief which would be afforded after the reports of the Tariff Commission were piesented. ^1 understand that those reports are now to hand, and, no doubt, one of the objects of the motion is to allow the Government to deal with these cases of harrowing distress.
– I have on the notice-paper a very important motion, affecting a very large section of the community, but I recognise that the Tariff proposals of the Government, which affect an even larger section, are of more, pressing importance. As the Prime Minister has said that he will, if possible, give honorable members an opportunity to deal with their business, I am only too willing to support the motion.
.- Whilst agreeing with, the Prime Minister in the desire for the expedition of business, I think that consideration might be given to the fact that some private members have ver y important motions on the business - paper already partly dealt with or altogether untouched. I have set down for the 30th August a motion dealing with reciprocal trade relations with New Zealand, having surrendered my right to proceed with it earlier in the session to allow honorable members to visit Queenscliff on . the occasion of the sending of the first message by wireless telegraphy from the mainland to Tasmania.
– Other honorable members did the same.
– I admit that. While recognising the reasonableness of the Government proposals, I ask the Prime Minister whether if at any time during the remainder of the session an opportunity presents itself to proceed with private business in Government time, he will allow us to take advantage of it?
.- I intend to oppose proposals such as this so long as the Government allow honorable members to occupy three or four hours in speaking on the business brought before us.
– The honorable member for Darwin, for instance, took three or four hours to deliver himself in regard to the Budget.
– I am not responsible for any conduct but my own; but I feel that if honorable members curtailed their remarks we couldget through the business on the notice-paper within a month.
– I have a motion om the business paper which, if not dealt with this session, cannot have any effect for the next three years, since it relates to the holding of general elections. I wish to provide that every person on the roll of electors shall be compelled to accept the full responsibilities of citizenship by casting his vote on the occasion of Parliamentary elections, and if the motion is not carried into effect this session so. as to apply to the next general elections it will not be applicable until three years later,. My own speeches in this Chamber will be very brief and to the point, and I hope that if an opportunity occurs to allow this very important matter to be dealt with the Prime Minister will allow us to take advantage of it.
– I have some very important motions on the business paper, but am even more anxious than is the leader of the Opposition to proceed with Tariff reforms. It is a matter of very great regret to me that not a line of the evidence submitted to the Tariff Commission has been made available to honorable members.
– Whom does the honorable member blame for that?
– The members of the Tariff Commission. That evidence should have been sent to honorable members as it was given, instead of being filtered through the newspapers. I have not known a Commission to act as this Commission has done. The result of its arrangements will be that we shall get a whole pile of evidence at one time, and shall have a great mass of details put before us which it will be impossible to go through.
– This is a protectionist speaking ! He wants an excuse for not dealing with the matter now.
– I am speaking, not in mv owji interest, but in that of those situated like the honorable member.
– I am prepared to deal with the subject at once, but the honorable member is trying to shirk the settlement of the Question, though he has continually been saying that it is necessary to have it dealt with.
– The evidence ought to be in the hands of honorable members, so that we can form an opinion upon it apart from . the recommendations embodied in the reports of the Commissioners. As it is, we are in possession of nothing.
– The honorable member has read the newspaper reports.
– It is assistance, not evidence, that his friends want.
– I desire that thematter may be settled in such a way that it will not be re-opened for a considerable time. If it is only patched up by the removal of so-called anomalies, it will soon be re-opened.
– The honorable memberdoes not wish it to lie settled before thegeneral elections.
M!r. MAUGER.- I wish it to be settled’ as soon as the honorable member does.
.- I, too, have an important _motion on thebusiness paper - I believe the most important there. It deals with the taking over by the Commonwealth of the Northern Territory of South Australia, and I hope that the House will come to some decision! in regard to it. I trust that the Ministry, who I believe are in earnest, will attempt to arrive at a settlement between South Australia and the Commonwealth on the subject.
– How would the appointment of a Royal Commission suit the honorable member?
– That, in my opinion,, would delay matters. A big effort has. been made in South Australia to prevent the Commonwealth from obtaining control” of the Northern Territory, and if. the matter is allowed to rest, steps may be taken by a section of the politicians of that State which will prevent the Commonwealth from doing anything in regard to it for a long time to come. I believe that, inthe interests of the State and . of the Commonwealth, the Territory should be. under our control. Hence I am anxious that, notwithstanding the pressure of business before us, we should have an opportunity to come to some decision - to make some offer. At present we are standing off from each other.
.- If the motion be agreed to, it will prevent the House from proceeding any further with private member’s’ business. I have some little interest in this matter, because I have obtained permission to introduce a Bill to amend the Public Service Act in a somewhat important particular. I understand that members of the Opposition have some objection to my dealing with the sub- ject, and I should be very glad if the Government would take it in hand.
Question resolved in the affirmative.
Debate resumed from 9th August (vide page 2631), on motion by Sir John Forrest -
That the itenf? “’ President, £1 , 100” be agreed to.
.- Last night I was endeavouring to show how the principle applied by the Minister of Wax to Great Britain’s second line of defence might be applied with equal reason to -that of the Cornmonwealth. There was nothing new in the proposition, but I think I should be able to show that the risk to Australia, if ever her second line of defence is called into requisition, will be much more considerable than has been enerally apprehended. There is very little danger at any time for the next decade or so of the Imperial command of the seas being absolutely lost, but it is possible that a combination of the whole of the naval powers of Europe against Great Britain might compel the latter to so concentrate her forces in a particular place, as to render it necessary for her to temporarily surrender her control of the eastern seas. It is by no means certain that in such an event the Asiatic powers that might be involved would trouble Australia. There are other points of the Empire in the eastern seas that might be more vulnerable and of greater importance from a military point of view, especially whan one considers that control of the eastern seas by such powers would be only temporarv. and that as soon as the menace to England by the European Powers had been removed, she would once more assert her supremacy in the East. Therefore, an Asiatic power might not care to embark upon . 1 large expedition with the object of” territorial occupation so far from her base. We must, however, be prepared for all eventualities, and, therefore, I would suggest that what is needed as a second line of defence is the skeleton of a vast citizen force - a skeleton which, in the event of an outbreak of war, could be rapidly clothed with flesh and blood. I should like to quote from a French technical paper called Armee et Marine, which expresses itself as follows: -
Le detroit de Malacca, passage si fréquenté, porte des mers d’Extreme-Orient, est un des points strategiques les plus importants du monde. Sur ses bords, Singapore est devenu depuis longtemps” un port commercial et un entrep6t de premiere importance. L’Angleterre va l’eriger en station navale, point d’appui de la flotte et grand dep6t de charbon pour la marine.
II etait encore depourvu de docks pour les reparations des grands croiseurs et des cuirasses; on va les lui donner.
L’agrandissement des docks de Singapore va donner une valeur toute nouvelle a ce port splendide qui pourrait reunir toutes les flottes britanniques. II etait deja le point de rendezvous oil les chefs des escadres angiaises de Chine, d’Australie et d’Extreme-Orient se plaisaient a concerter leurs plans devolutions et de manoeuvres. Desormais, port ‘de guerre de premier ordre, flanquant le passage le plus commode et le plus frequente entre l’Oc£an Indien et les mers de l’Asie Orientale, ce point va devenir un centre strategique incomparable et dont l’importance depassera celle de Gibraltar.
Pour qui cherche a penetrer les desseins de l’amiraute britannique, il est curieux de noter que ce renforcement de puissance coincide avec le renouvellement du traite d’alliance anglojaponais et l’entente cordiale de la France et de l’Angleterre.
La Grande-Bretagne, libre d’intervenir partout, se reserve de pouvoir sans danger concentrer ailleurs tous ses efforts.
I think that this clear testimony to the value of Singapore from a military point of view indicates that in the event of the control of the eastern seas being temporarily surrendered by Great Britain, Australia might still remain immune, because of the greater opportunities open elsewhere to the enemy. If we neglect our first line of defence upon which our security will depend, we shall expose ourselves to undue risk. If, on the other hand, we endeavour, in addition, to maintain- a large standing army, our Treasury will soon be exhausted. Therefore, I suggest that we should not relax our efforts to bring about a proper system of naval co-operation between the various portions of the Empire. So far as the second line of defence is concerned - the provision of an army to repel invasion - I suggest that only such parts of that organisation as cannot, be readily brought into existence should be kept in a state of preparedness. This organisation would include the staff, the administration, the military stores, the higher officers, and a pattern force, upon which others could be modelled. All these things could be provided for without incurring exceptional expense, and we should be able to put the flesh on the skeleton when a time of crisis arrived, and turn out the rank and file in a thoroughlv efficient state. There is one side of our land defences with which I have not yet dealt. I refer to the coastal defence force. At the present time, practically the whole of our defence forces might be included in that definition. These forces must always- be ready, because coastal defence is complementary to sea power, and is liable to be put to the test even while command of the seas is still held. The honorable and learned member for Northern Melbourne, perhaps in his anxiety to follow the opinions of his political patron, the honorable member for Bland, fell into a curious error. At page 2431 of Hansard he is reported as having stated -
With an islan-1 continent the first thing to be looked for is coastal defence. Notwithstanding all the rifles, guns, and forts, nothing compares in importance with coastal defence.
The honorable member seems to have forgotten that forts and guns are usually regarded as forming an essential part of coastal defence. A very distinguished writer on these matters, who perhaps has done more than any other man to advance sea power - I refer to Captain A. P. Mahan - says - “ The best protection against an enemy’s fire,” said Farragut, “ is a well-directed fire from our own guns.” Analogically, the best defence for one’s own shores is to harass and threaten seriously those of the opponent ; but this best defence cannot be employed to the utmost, if the inferior, passive defence of fortification has been neglected. The fencer who wears also a breastplate may be looser in his guard. Seaports cannot strike beyond the range of their guns; but if the great commercial ports and naval stations can strike effectively so far, the fleet can launch into the deep rejoicing, knowing that its home interests behind the buckler of the fixed defences are safe till it returns.
If, therefore, in maritime war, you wish permanent defences for your coasts, rely exclusively upon stationary works, if the conditions admit, not upon floating batteries which have the weaknesses of ships. If you wish offensive war carried on vigorously upon the seas, rely exclusively upon ships that have the qualities of ships and not of floating batteries.
So much for this curious misconception of the honorable and . learned member. I should like to ask honorable members who are interested in this matter what particular purpose torpedo vessels would serve in connexion with our coastal defence ? Such vessels would be smaller than those which the Naval Director, in his last report, has shown to be too small for work’ upon the rough coast line of Australia. Thev would be infinitelv smaller than any hostile vessel that would come to these waters. They are designed particularly for attack upon dark nights and in thick weather, and they were tried during the late war between Russia and Japan, with the most disappointing results. Such vessels would not have the effect of frightening any invading ship away from our coast. If they met a raider, their position would be reminiscent of the charge of the Watch in Much Ado About Nothing.
– Is the honorable member referring to the ships in connexion with which we pay the naval subsidy ?
– No, I am referring to Captain Creswell’s proposed torpedo vessels.
– The ships in regard to which we pay a subsidy are stated by the Admiralty to be of’ very little value - most of them should be on the scrap heap.
– The honorable member is evidently under a misconception, because at present the vessels for which we are paying as drill ships are of the very newestdesign.
– The Powerful is of old design.
– We are not paying for the Powerful.
– Yes, we are.
– I am speaking of the arrangement that certain vessels should be kept here.
– Including an armoured cruiser, and there is no armoured cruiser on the Australian station.
– The honorable member ought to know that the Powerful has recently been altered, and that she* is now practically an armoured cruiser.
– She is net, nor anything approaching it.
– The honorable member is relying upon an old definition of the term “ armoured cruiser.”
– Is it not a fact that most of the vessels for which we have been paying are now upon the scrap heap?
– I can only answer one interjection at a time. The honorable member for Bland in speaking the other dav appeared to take it for granted that these ships were withdrawn from Australian waters in order that our coast line might be open to attack.
– I did not sav thev were withdrawn in order to accomplish that. I said that they were withdrawn.
– It may cause the honorable member great surprise to learn that the reason why these vessels leave us is that they may the better discover any ship which may be contemplating an attack upon it-
– I have heard of that, and I have also heard something about a person looking for a needle in a haystack.
– The honorable member has a good deal to learn in this connexion.
– Unfortunately, the honorable member himself thinks he has not.
– I should like to know what instructions would be given to the Australian torpedo flotilla in case of the outbreak of hostilities. Certapnly, they ought to partake of the nature of the advice which was given by Dogberry to the watch in the third act of Much Ado About Nothing. There, Dogberry, addressing the commander of the watch, says -
You are thought here to be the most senseless and fit man for the constable of the watch ; therefore, bear you the lantern. This is your charge : You shall comprehend all vagrom men ; you are to bid any man stand, in the Prince’s name.
Thereupon, the second man of the watch inquires -
How if he will not stand ?
To which Dogberry replies -
Why then, take no note of him, but let him go; and presently call the rest of the watch together, and thank God you are rid of a knave.
That would necessarily be the attitude adopted by the Australian torpedo flotilla so far as raiders are concerned. They should bid the enemy stand in the Prince’s name, and if he will not stand, they should let him go, and thank God that t’hey are rid of a knave. That is about as much as our mosquito fleet could achieve in time of war. I should like to ascertain from the Treasurer whether any provision has been made in the Estimates for ‘giving effect to the recommendations of the Imperial Defence Committee so far as our coastal forts are concerned ?
– No provision has been made.
– I do not know what are the recommendations of that body, because, so far, they have not been made public. But I think it is certain to recommend the conversion of our slow hydro-pneumatic ordnance to a quick-firing gun, probably a mark 7 6-inch gun. That conversion will involve a certain capital outla.v, although it will eventually result in lightening the burdens of the taxpayer. I am sorry that no provision has been made in that direction. Am I right in assuming that the Minister will provide for it in a special Bill?
– I cannot say at present.
– It is quite possible that the Committee will recommend the abolition of the submarine mine establishment, for the purpose of bringing all the ports of the Empire into line in this regard. That recommendation would not imply that the submarine mine is not an. efficient weapon, because, as a matter of fact, the German Government have recently been increasing their submarine mine strength. But the reason which will probably be urged for its abolition is that the British authorities have* not confidence in the control bv shore authorities of submarine mines. The same consideration must necessarily apply to torpedo flotillas under local control in harbors. If the Imperial Admiral upon the station does not understand the discipline of such flotillas, there is no doubt that he would much rather dispense with their services entirely, because thev would be a source of danger to himself, as well as to the enemy. I hope that the Treasurer will carefully consider this aspect of the question. I do not desire to delay the Committee at any greater length. I merely wish to say that honorable members must recognise the new position of the Commonwealth, so far as her defence problem is concerned. The rise of the great powers in the East makes it imperative that the naval strength of the Empire shall increase proportionately with that of Europe and Asia combined. Therefore, we should do our best bv manly co-operation with . the other sections of the Empire to maintain a. common Imperial Navv which will be strong enough to meet all possible dangers, from whatever part of the world they may come.
.- I am one of those who recognise-
– I think that we oughtto have a quorum present. [Quorum formed.]
– I recognise the very intelligent interest which the honorable member for Wentworth has exhibited in the questionof national defence. With reference to the preceding speech which was delivered last night bv the honorable member for Gwydir, I feel very grateful to you, sir, for having called on the honorable member instead of upon myself - following the established rule of alternating the speakers from different sides of the House, which is a very proper rule - because he has provided us with the missing Jink in the practical politics of Australia to-day. The Treasurer proudly boasted that there were no political skeletons in the cupboard of the Ministry, but I know of half-a-dozen, and one of them -is this question of, a Federal progressive land tax. It is .rather surprising - in view of the important bearings of such a proposition, and the demand which has been made upon the Government by the .great body of their nominal supporters in the Labour corner - that the Treasurer in his exhaustive survey of the affairs of Australia - and incidentally I must give him credit for the great industry which he displayed in the Budget recently presented to us - did not even mention this matter. In passing, I wish to recognise in the fullest possible way the ample information which has been given by the Treasurer in connexion with the public finances. At the same time, we must not forget the great debt of obligation which we owe to the right honorable member for Balaclava in this connexion. Unfortunately his health precludes his attendance regularly in this House. But I look upon the labours of that eminent statesman in laying the foundations of a proper system for the exhibition of the financial affairs of Australia as services which ought long to be remembered. He has formulated a plan which I am glad to see the Treasurer has faithfully observed. In my opinion, nothing could exceed the completeness of the information which the right honorable member for Balaclava, as Treasurer, gave to us in years gone by in his Budget statements. In .this connexion I wish also to express - and I think I may express it on behalf of honorable members upon both sides of the Chamber - mv sense of obligation to the permanent officials of the Treasury Department. Nobody knows better than does the Treasurer how invaluable are the labours of these officers in connexion with this great question of Australian finance. Reverting to the speech of the honorable member for Gwydir, I should like to say that in the most exhaustive and thorough way he has revealed to us the result of the caucus deliberations upon the vexed question of a Federal progressive land tax. Of course, we are not privileged to send reporters to the meetings of that body-
– The right honorable member does not invite us to the meetings of his party.
– We have very seldom the slightest chance of learning the nature of the deliberations of the caucus, and I do not think that we have even yet discovered where it meets. That is still a matter of profound speculation. But wherever it may meet, we are sometimes indebted to an unusually verdant member of the party for a limelight exhibition of the effect of the proceedings which are elaborated in the hidden recess where the caucus assembles. The honorable member for Gwydir disclosed the policy of the Labour Party in reference to the imposition of a progressive land tax with a thoroughness and enthusiasm which left nothing to be desired. I am glad to see that he has recovered from his great effort, and is looking excellently well. I should like to express my acknowledgments to him for the thorough and earnest way in which he expounded the views of the Labour and Socialistic Party upon the question of a Federal land tax. In the first place, setting aside the policy which is in view, ray matured opinion is that the project of making use of the powers of the Federal Parliament to impose direct taxation in order to burst up big estates amounts to a deliberate attempt to outrage the fundamental principles of the Federal Constitution.
– I may be wrong, but I am simply claiming my right to express my own opinions on the subject.
– One might as well claim that the adoption of the policy of protection is an outrage of the principles of the Constitution.
– I am not expressing the views of the honorable member; I am simply endeavouring to express my own views on this question.
– Are thev authenticated?
– We listened to the honorable member last night when, for, about three hours, he perspired tears, not of blood, but of bathos, and surely he will permit me to briefly1 express my views. I do not know what order the honorable member observes in the caucus, but he ought to behave himself better when he is in the Chamber. I wish to briefly explain my reasons for taking the view of this question that I have just enunciated. The lands of the States are left under the sovereign control of each of them. The electors of Victoria, New South Wales, Queensland, South Australia, Western Australia, and Tasmania are not enabled by the Federal Constitution to exercise the slightest control over the respective policies of those respective States. Victoria has sovereign control over its land problems, and so with New South Wales and the remaining States. Each State has complete control and sovereignty over all questions affecting land settlement and’ the ownership of the land. On the principle that the Federal Constitution vests in the Parliament of the Commonwealth, only that power which is expressly given, and that all that is not so given is left to the States, this Legislature has nothing to do with the lands of Australia, save in regard to the imposition of direct taxation. The object of the proposals of the Labour Party is not to fill the Treasury with revenue in some emergency, because at this very moment, when a ‘ progressive land tax is being advocated, the Federal Government are proposing to give away revenue to the extent of ,£200,000 per annum - a sacrifice for which no one has asked. That being so, there is no pretence of an emergency in relation to the Federal Treasury. The endeavour to make use of the power given to the Commonwealth, Parliament to impose taxation for revenue purposes, in order to do something that has everything to do with the land, policies of the States, and nothing to do with the raising of revenue is a direct attempt to twist our powers under the Constitution - to invade the rights of the States in one of the most vital problems in Australian politics to-day. If we took over the burden of the management of the lands of Australia, the case would be different, but in an arena where none of the anxieties of land problems haw to be dealt with, we are assuming to interfere in a vital way with the administration of the lands of the States. Each State to-day is perfectly free to pass any system of progressive land taxation that it pleases. In considering such questions, the people of one State have not the slightest right to interfere with the decisions of another. What right would the people of New South Wales or Victoria; have to interfere with the views of the people of
Queensland as to the way in which the land policy of that State should ‘be settled? And so with all the States. When the Conciliation and Arbitration Bill was before Parliament, the Prime Minister - who, whether his opinion was right or wrong, deserves a large degree of credit for his action - viewed an amendment with reference to the application of the Bill to States railwayservants as an infringement of States, rights. Greatly to the regret of a largenumber of honorable members who voted for that amendment, he took the view that he could not honorably remain in office, having regard to that outrage on the principles of the Constitution, and the consequent aggression on the rights of the States. Within a few short years, however, we find him lending hi,s support to a project of this’ kind which would seriously interfere with the sovereign rights of the States in a matter of infinitely more vital concern. I am. sure that the Treasurer will not even, because of his official position, pretend to sympathize with such an outrage on theConstitution. He is man enough to says that he would not do so.
– I have expressed! myself clearly on the subject.
– The right honorable: gentleman, in a most straightforward and prompt manner, expressed his views in the direction I have indicated.
– But Iia did not base his objection on constitutional grounds.
– No. I do not think that he has studied the constitutional aspect of the question ; but he based his objections on. verv broad grounds of principle and ex- pediency, which are quite sufficient. In these circumstances, therefore, we have thePrime Minister of the Commonwealth obeying the mandate of the leader of the Labour Party - saying “ Yes, Mr. Watson,”“ on the question of a Federal land tax - whilst we have the Treasurer, the custodian of the finances of the Commonwealth, scouting the project as one that is inadvisable, to say the least.
– What is the Minister of Trade and Customs doing?
-Who knows what he is. doing? Everything he does that is worth anything is precisely that of which no oneknows anything ; it is all underground work. I approach now the consideration of a principle which has been laid down by the honorable member for Gwydir. The honorable member drew a picture which somesimple person in the- gallery might have- thought was wrung from a bleeding, lacerated heart, but which we, knowing, him, recognise as_ simply one of his amateurish efforts at rhetorical effect. He attempted to draw a picture - which was painful enough to move even one of these massive pillars in the House - of the horrible sufferings of the Australian artisan because at present he has not a farm. It is the artisans who, according , to “the honorable member, are to go on the farms to be opened up to Australian industry. The honorable member, in drawing his touching picture about the inalienable right of the States to the ownership of land, should have remembered that he was twisting the Constitution! and proposing to put it to an unworthy use. In England, in days of old, the sovereign was the owner of the land, and so, in one sense, the State - not the Federal Parliament, but each of the States - is the owner of the land within its boundaries. But when an owner- of land sells that land to an individual, and takes money for it, and then talks of his inalienable right to occupy that land - he is a rogue, or else holds the view - an honorable view it may be - that the proceeding itself was one that was attended with some fraud or inequity. The position in this democratic country which has unlocked the lands, and which, under a democratic system of manhood suffrage, has sold it. is different from that which may be said to have existed in older countries. The position of the Australian democracy in reference to the land is that that land was vested in it by the Crown, and that it sold it and-
– Got the money.
– And got the money. When the honorable member for Gwydir says that, in spite of that transaction, the State still has a right to the land, and should take it by, means of bursting up big estates-
– I did not say anything of the kind.
– The honorable member went as nearly as he could to making such a statement.
– The right honorable member should not attribute to me statements that I have not made.
– I can never thoroughly appreciate the views of the honorable member, because he cannot express himself clearly.
– It is the right honorable member’s denseness that makes him unable to appreciate my views.
– What I was able to gather from the remarks of the honorable member was that-
– Better judges than the right honorable member have said-
– Order !
– I think that the honorable member ought to take punishment better. We all have to take it in turn.
– The right honorable member leaves the Chamber when another honorable member proceeds to criticise him.
– I have had to take a fair amount of punishment in my time.
– The right honorable member takes very little in this Chamber.
– The honorable member spoke of the inalienable right of the people to the land. I recognise that, in the sense that no man has a stronger belief than I have in the principle of breaking up big estates. So far from having any’ conservative view on this subject, I hold that Australia will never be anvthing like a country fit to develop on broad national lines until its enormous estates are broken up. I admit that no statesman in any State could have a stronger or more beneficial policy in view. That being so, it is not from any antagonism to the object which the honorable member and his party have in view that I am criticising the means by which they seek to achieve it. I merely say that the Federal Parliament has no more right to take up the process of breaking up large estates than has an individual to pull down the fences which subdivide them. Every individual has just as much right to do that as the Federal Parliament has to endeavour to break them up. There is. a very simple method of dealing with this problem. All that is necessary is to resume the land for the purpose of closer settlement, and to pay its honest value. That is a simple method, which will solve all difficulties in regard to the large estates.
– Compulsory resumption?
– Compulsory resumption. Mr. Batchelor. - The honorable member would be described in some places as an anarchist for making; such a proposal.
– I am expressing the view that I enunciated before a large gathering in Adelaide a night or two ago.
– And did not the right honorable member’s audience howl at it?
– No; and even the honorable member’s supporters did not howl at me when 1 was dealing with other points. I am very grateful to the people of Adelaide for the magnificent hearing they gave me. It will be seen from what I have said that it is not because of any unfriendliness to the policy of closer settlement that I object to the Labour Party’s proposal. My opinion is that if the Federal Parliament begins, even for a good object, to twist the Constitution to-day, it will create a precedent which may be followed for the most pernicious and wicked objects. I am glad that the Labour Party, as represented by the honorable member for Gwydir, has, in the most candid way, put forth its views in connexion with this subject. On this issue I am prepared to meet the Labour Party all over Australia. The land of Australia can be thrown open to the young Australian farmer to-morrow, or as soon as the people of any State are in favour of closer settlement. I believe that the majority of them are. The simple plan to adopt would be to more fully exercise the power of resumption which is now being exercised in several of the States. But we must pay honestly for the land according to its value.
– Much of it was dummied and stolen.
– That is a matter which may be investigated on its merits. We must not confound’ the man who holds land under honest conditions with those who have abused the laws of the country. It would be a novel way of finding the path of equity to confound the man who has abused the land laws with the man .who has honestly taken up - land under those laws. Besides, it must be remembered that, in imposing taxation, we cannot pick out one man, and another, and not apply it to all. May I remind’ honorable members who sit in the Government corner benches that the Western Australian Labour Federation, whose members cannot be . accused of sympathizing with the holders of large estates, have passed a resolution, denouncing the policy of the Labour Party as an incentive to frauds on the revenue?
– And they, in their turn, are being denounced for having taken such action.
– That is a matter which Labour members must settle amongst themselves. The Labour Federation of Western Australia has denounced the policy of the Labour Party, on the ground’ that it offers incentive to fraud, and would interfere with those who have bond fide exercised the powers given to them by the States. My strong point is that the policy of closer settlement is a policy for the people of each State to deal with. We have no more right to use our power of taxation to solve the land problems of the States than we have to put our hands into the States Treasuries.
– If that is the only argument to which we have to reply, we shall be able to meet it.
– The difficulty is that each State Parliament has an “Upper House.
– My difficulty lies in having to acknowledge valueless interjections which cause a painful waste of time. There are several subjects1 upon (which I wish to touch, and I shall proceed now to refer briefly to some of the salient features in the Financial Statement. In the first place, I notice that, whereas last year the Commonwealth returned ,£829,000 to the States, in. addition to three-fourths of the revenue for Customs and Excise, this year it will return only £311,000 - a drop of over £500,000. To Victoria and New South Wales that may not be a very serious matter, but it is most serious for Queensland, South Australia, and Tasmania. Their finances are not on a large scale, though their difficulties are. The difficulty they find im making both ends meet is very great. Therefore the reduction I speak of is a most serious thing to them, and I cannot congratulate the Treasurer, or the country upon it. If we were paying interest on the properties which we have taken over from the States - the post-offices, telegraph and telephone lines, defences, and public buildings generally - we should have no surplus to return to the States, because it has been estimated that, having regard to both interest and depreciation, £2,000,000 should have been deducted from our revenues, which has not been so deducted, because Jio arrangement has yet been made for paying for the transferred properties.
– The amount of the interest due is ,£2.300,000.
– I put it at £2,000,000 in older to be on the safe side. These figures have to be considered in the light of facts which we must not forget. The Treasurer estimates that our revenue for next year will show an increase on the revenue of last year of about f per cent., which means practically stagnation. In a time of admitted prosperity, he estimates that our revenue will not increase at the rate of i per cent. But, nevertheless, he proposes to increase our expenditure by 12½ per cent. One of the most unsatisfactory and astounding features of the Budget is that the Treasurer, with a practically stagnant avenue, is proposing to increase the public expenditure by 12½ per cent., or somethink like , £500,000. I admit that the expenditure of £50,000 or£60,000 on the forthcoming general elections is a special item.
– There was a good deal underdrawn last year.
– Yes; but the broad result affecting the finances of the States is that they will receive back this year more than £500,000 less then they received last year, and that, with a practically stagnant revenue, our expenditure is to be increased by 12½ per cent., while £200,000 which should be obtained for services rendered is to* be surrendered. Revenue to the amount of , £200,000 is to be given up without any demand from the public for such action. The picnic of the PostmasterGeneral to Rome is going to cost the Commonwealth a large sum of money. He must have got the idea there, when mingling with the distinguished men who formed the Conference which he attended. He has come back with these grand ideas, but let us see how they affect the position of the States. No State has had a more bitter trial with misfortune than has Queensland during the last few years.
– Or Tasmania.
– The finances of Tasmania and of South Australia have also been strained. Those three States have suffered severely. Queensland has just had another blow, owing to our very proper action in regard to the opium trade, whereby the State loses revenue to the amount of £22,000 per annum. We do not mind that, because the object which is being achieved is such a good one ; but on top of this loss of £22,000 is to come a loss of £’29,000 in carrying out the proposal of the Postmaster-General, or a total loss of £50,000. To New South Wales a loss of revenue of £50,000 or £100,000 per annum would not mean much.
– In addition to the loss of which the right honorable member speaks, there will be a great curtailment of country services.
-Yes. That aspect must not be forgotten. Tasmania will lose £14,000 a year and South Australia about £22,000.
– Together with £7,000 in connexion with the opium reform, making about £30,000 altogether.
– I look upon the establishment of penny postage throughout Australia as a noble idea, but, like many other splendid ideas, it must be approached rather slowly. I do not think that there is a man in this Chamber who wouldgrudge the expenditure of money for extending the facilities of the post-office to the most remote settlements. That is the direction in which we should be liberal. If we have £200,000 to spare, we might very well spend it in extending the postal service to the most remote parts of Australia.
– And in giving better telephone facilities.
– I do not think that the Committee would grudge the expenditure of £200,000 in extending the postal service, and in giving better telegraph and telephone facilities to our pioneers. The gieat bulk of the advantage to be gained by the adoption of the PostmasterGeneral’s proposal will go, not to the poor or to the pioneers, but to the great commercial interests of Australia. If the state of the revenue would allow us to make the sacrifice, I would agree to the giving of this boon to the commercial classes, because of its probable effect in increasing trade. But, at a time when the revenue is practically stagnant, and our liabilities increasing, the proposal is indefensible. Of course, it will be popular in business circles; but it stands out in singular contrast to the action of the Postmaster-General in trying to get a few extra pennies from the telephone service by the adoption of the toll system. There is no consistency in the honorable gentleman’s policy.
– In both cases a reduction is proposed.
– I admit that the object is a good one, but I do not think we are at the present moment justified in giving up this large amount of revenue.
– Does the right honorable member think that we should be justified in raising the Victorian postage rates to the level of the New South Wales postage rates?
– I shall be willing to consider the matter when a proposal to that effect is brought forward by the PostmasterGeneral. With reference to our trade, I should like to mention some rather interesting results, which. I have obtained from the statistics which have been so well prepared by the Treasury Department. In the first place, the importance of our primary industries stands out when the total value of our exports of primary produce is seen. In an export trade valued at £54,000,000, more than £50,000,000 represents the value of primary products. When statistics are given showing the enormous wealth per head of population in Australia, some self-satisfied Australians think what marvellous people we must be; but it is Nature that is producing this wealth for us. Whilst we have magnificent developments of personal enterprise, taking into consideration the sparseness of our population, the crowning factor in our marvellous progress is the fact that our great primary industries are making wealth for us without any personal effort of a commensurate character. I wish now to refer to the figures dealing with the trade between Australia, the motherland, and foreign countries. Another of the skeletons in the Ministerial cupboard is fiscal peace and preferential trade. Ministers are now going to put up a high Tariff wall,- which will injure the trade of the mother country. Their supporters are visiting the factories, making speeches; and the honorable member for Bourke told a meeting the other day that we should build our Tariff wall as high as that of the United States.
– Mr. Irvine says the same thing.
– It does not make the situation any better that Mr. Irvine should have gone back upon his old fiscal faith. I am not responsible for this extraordinary development; that is a matter for him to explain.
– The Opposition are a happy family !
– At any rate, we can talk frankly, which is sometimes more than a bullock-team can do. The Prime Minister has unfurled an enormous flag, bearing on it the legend - “The mother country for ever, and preferential trade,” while the Government Whip is walking after him, holding aloft a little piece of calico, on which is written - “ Down with the British manufacturer. ‘Build the Tariff walls of Australia so high that he shall not have a chance to even put his nose over.” Car* even the credulity of Victorian protectionists be imposed upon by inconsistencies so glaring as that? The two things will not hang together at all. We have already heard of the subsequent remarks of the men who have attended these gatherings. They go away saying, “ These gentlemen with the big manufacturers behind them are sounding the drum, and we are good protectionists ; but we are going to vote for a labour protectionist, and not for one of the long-coated brigade.” They listen to these gentlemen with their tongues in the cheeks, and all the time say that, although the principles advocated are excellent, they are going to vote for their own men.
– There is no objection; to their enjoying themselves.
– No; but the question is whether they are getting any nourishment, particularly during a time that really ought to be devoted to that healthy object. With reference to our imports from Great Britain, I should like to point out that it is remarkable that, in spite of the absence of a preferential trade arrangement, during the eleven years from 1894 to 1905 the British goods sold in. Australia were valued at £1,000,000 more than the increase from all the foreign countries of the world put together.
– The right honorable gentleman knows why that is?
– If I were to go into these matters in detail I should occupy the attention of the Committee all day. I am merely putting to honorable members’ the broad results, which are susceptible of various explanations. In spite of the fact that we have imported largely from foreigncountries having climatic conditions which are specially adapted to the cultivation of certain articles which cannot be produced in Great Britain, our trade with the mother country has increased by more than £1,000,000 above the increased trade with foreign countries. Then there is this extraordinary fact, which must not be forgotten : that the sales of the old country to ourselves have increased at twice the rate that her purchases from us have increased. I know that some protectionists lay great stress upon- the importance of increasing our exports and diminishing our imports. Our imports from Great Britain have increased to the extent of £7,300,000, whereas our exports to Great Britain have increased to the extent of only £3,750,000, or about half. But we cannot shut our eyes to the gratifying feature that, whilst our import trade with foreign countries has increased by £1,000,000 less than has our import trade with Great Britain, our exports to foreign countries have increased instead of decreasing. Whilst our imports from foreign countries have increased by only £6,000,000, our exports to foreign countries have increased by ;£i 1,000,000. No one could quarrel with a development under which we send out to foreign countries twice as much as we receive from them. We have to remember that all these foreign countries are taking our primary products at an enormous rate.
– They would take them under any circumstances.
– I do not suppose the honorable member objects to that.
– They take them because they want them.
– Then it is gratifying to find that thev want our products. I do not care how the matter is put. So far as the producer is concerned he does not ‘ care why they take his produce, so long as they take ‘ it.
– We shall have them complaining of our dumping.
– Talking about dumping, when I was recently in Queensland, I made this discovery : The complaint of the people there is not against the British or the foreign dumper, but against the Victorian dumper. They say that it is the dumpers of the two big manufacturing centres, Melbourne and Sydney, who are throwing their artisans, out of employment. I told the people that this was one of the legitimate fruits of Federation, and that the manufacturers of Melbourne and Sydney had a perfect right to the market of Queensland, whilst the . Queenslanders derived great advantages from having the Melbourne and Sydney markets thrown 1 open to their sugar and other products. I am merely showing how the shoe pinches the people of Queensland.
– It also pinches Tasmania.
– Yes; Tasmania is suffering also. The people of Queensland say that a higher Tariff, instead of helping them, will only aggrandize the manufacturers of Melbourne and Sydney. I should like to express my great gratification, which
I am sure is shared on all hands, at the general prosperity which has come at last all over Australia. It is a subject of gratification, particularly after the terrible pictures that were drawn of the fearful suffering brought about in Victoria through the closing up of factories, owing to the operation of the Federal Tariff. It is very gratifying to know that there is already a turn of the tide in Victoria. Whatever our views upon the fiscal policy may be, we must all be delighted. I say that a man in New South Wales, who is not as delighted at the prosperity of Victoria as with that of his own State, is entirely deficient in a proper comprehension of what Federation means. I look upon the undoubted increase of the prosperity of Victoria as one of the most gratifying signs in the circumstances of Australia to-day. As so many gloomy pictures were drawn by the Melbourne Age in connexion with the alleged strangling effects of the Tariff, I should like to quote, some remarkable testimony given by that newspaper as to the glorious prosperity which has come upon Victoria, even under the present unfavorable conditions. The Age of the 22nd June, referring to the statement made by Messrs. Mann and Fleming, that there were 5,000 unemployed in Melbourne, said -
That is a most serious statement. If it were capable of being substantiated, the prosperity on which we have been priding ourselves of late would be proved a hollow sham, and we should then have occasion to doubt the accuracy of the statistics recently published concerning our expanding trade. The Customs returns show that for the first five months of this year our oversea agricultural exports have increased by £1,159,000, compared with the corresponding period of 1905. The wheat yield for the past season has been estimated at 24,000,000 bushels, an average of more than 12 bushels to the acre, and at the same time, notwithstanding our steadily increasing population, general imports from abroad have notably diminished.
This must ‘have been gratifying news to the protectionists of Victoria, who have told us that the Tariff was swamping Victorian industries. The Age continued -
These figures testify that in every department of our industrial life we are forging ahead. Our agriculturists are thriving, and our manufacturers, despite the handicaps they have at present to fight in the shape of ineffective protection, foreign trust competition, and many lamentable holes in our tariff fence, are beginning to overtake and supply the wants of the people with the products of Australian labour.
Yet, although we are now producing at a rate in excess of all past precedent, we are asked to believe that we have more unemployed in the city to-day than ever. Public prosperity does not reveal itself only in statistics. It is quite apparent that we are a prosperous people. In many parts of the country there is a call for unskilled labour, which halts to be satisfied. Almost all our trades are flourishing, and the demand for skilled workmen is at least equal to the available supply.
It is very gratifying to note that the Jeremiah of Victoria is bursting out into a song of praise and jubilation. The dark cloud has passed away, and in spite of the defects in the Tariff, which the Age was among the first to point out, it is now able to assure the people that the great industries of Victoria are in a flourishing condition. There is no greater proof of that fact than is to be found in the condition of the agricultural implement industry, for which the worst fate was predicted. It was stated that the wicked Canadians and Americans were ruining the agricultural implement industry of Victoria; but what is the present condition of affairs ? The returns are most astonishing. No industry in Australia shows a more rapid development during, the past three years. In 1902 789 hands were employed; in 1903, 1,114; in 1904, 1,496; and in 1905, 1624. Thus there has been an increase of 106 per cent, in three years.
– That is in one of the declining industries.
– Yes. Victoria is the only place in the world in which we find people libelling their own country and’ disclaiming their own prosperity. Here is a magnificent development. The number of hands employed in the agricultural implement industry has been doubled in three years, and yet we have these unpatriotic and absolutely false descriptions of the condition of the people connected with the industry. This has been the most elastic progressive industry in Australia from the point of view of the employment afforded. The total returns for Victoria show that in 1904 there was an increase of 3,000 hands in the number of workers employed’ in the factories, and a further increase of 3,000 hands in 1905. Therefore, whatever our fiscal views may be, we must be delighted to find that in spite of the Tariff’ which is certainly lower than that to which Victoria had been accustomed, the industries of the State are not showing any sign of degeneracy, to say nothing of the predicted ruin. The remarkable fact is that Victoria was at her worst when she imposed the -highest duties. Desperate efforts were made to put things right by adding to the duties after the panic of 1893, but as the duties went on the people went out.
– Mr. McKay makes a clear profit of £28,000 per annum.
– Mr. McKay is a very clever man. He removed’ his works to Braybrook in order to evade the operation of the Victorian Factories and Shops Act. He went away from <the great city of Ballarat to Braybrook to escape from the laws of the country, and yet he is the one man who has been championed in this Chamber from first to last.
– Only one class of Mr. McKay’s employes would come under the Wages Board provisions of the Act.
– I see that the Government are going to extend the operation of the Act to Braybrook, so that evidently they consider that it is necessary to apply it to Mr. McKay. I do not know what the real cause was, but I think that Mr. McKay objected to the Factories Act in so far as it prevented him from employing a large number of boys in proportion to the men engaged’. Under the Wages Boards, the employment of only a small number of boys is permitted, and I understand he has a very much larger proportion of boys at his works at Braybrook., I do not feel any particular sympathy with Mr. McKay under the circumstances.
– Nor do I.
– I think that Mr. McKay’s invention is one of a most useful character, and that his career as an. inventor is one that we cannot help admiring. It is the use that Mr. McKay is trying to make of his previous enterprise and exploits that I do not quite sympathize with. Now, with regard to the question! of immigration, which has been elevated to a position of great importance by the Government, and’ with regard to which I hope that they will take some effective action, I wish to direct attention to the significance . of the returns. During the last five years we have added 286,000 infants to our population, but for the whole of Australia our excess of immigration over emigration has amounted to only 440 souls per annum. At that rate of immigration* it would take us 800 years . to equal the increase by immigration during the ten years from 1880 to 1890. Is it not most significant that this great Commonwealth, instead of being in the highest degree attractive to the enterprise of the world, should have been for all these years under the shadow of a black cloud, and that the stream of immigration should have been practically stagnant? So far as I am concerned, I will never be a party to any immigration which will have the effect of increasing the population of our big towns. I think it would be a crime to spend public money in gorging the over-crowded cities of Australia. There is no patriotism in that. The current of immigration that I desire to assist is the immigration of persons who will devote themselves to the primary industries! of Australia. That is the sort of immigration we want. We want to make the current flow from the towns into the country, instead of from the country into the towns. I merely wish to touch briefly upon these matters, because I do not think I would be justified in occupying very much time at the present juncture. But I wish to refer to the proposed duties upon spirits. The Government proposals in this connexion are very important. So far as my experience as an ex-Treasurer of New South Wales goes, and so far as I can learn, the proposed increase of is. per gallon in the Customs duty upon spirits - an increase from 14s. to 15s. per gallon - is an absolutely unjustifiable one. It will only have the effect of increasing the evils connected with the spirit trade, and will not be of the slightest benefit to any proper interest. I would have supported the recommendation of the Tariff Commission in this connexion, because my view has always been that, having appointed a body of able gentlemen, who have exhibited marvellous industry in conducting their inquiries, we should, wherever possible, presume in favour of their mature and deliberate conclusions. I was prepared to accept their recommendation implicitly-
– They were unanimous upon the question.
– Exactly. Their recommendation was that of the whole Commission. I think that wherever we can we should give effect to the improvements recommended bv the Commission without delay. But the Government proposal will probably involve a long debate. The experience of all Treasurers is that if the duty upon spirits be raised beyond a certain point the revenue will gain nothing, while the quality of the article will deteriorate.
– In Western Australia, for many years prior to Federation, the duty was 16s. per gallon.
– But Western Australia occupied a different position from that of the other States. Her people could stand anything in those days; but in these older States the imposition of such a duty would constitute a strain upon the purity of the article which would do more harm than good. Moreover, the revenue will not be improved if the proposed duty upon spirits be ratified by Parliament. During the bad times in Victoria the Customs duty upon spirits was increased from 13s. to 35s., and the Excise duty from 10s. to 12s. The result was that, whereas under the old rate of 13s. per gallon a revenue of £806,622 was collected, under the 15s. rate only £[472,805 was collected. In other words, there was a loss of revenue which represented nearly 50 per cent. Of course, it is only fair “to remember that the bad times which had fallen upon Victoria and upon other parts of Australia were an element which contributed to that loss. But that factor did not fully account for the enormous decline which took place in the Customs receipts. I wish now to say a few words with reference to a very important question connected with the financial provisions of the Constitution - I refer to the taking over of the States debts. This matter has been exhaustively dealt with by the Treasurer and the honorable member for Mernda, and consequently I do not intend to deal with it in detail. I propose to give the fullest consideration to the schemes of both those honorable gentlemen. I do not forget the very valuable service which was rendered by the honorable member for Koovong last session in bringing this matter before the House, and I am very glad’ that since then the honorable member for Mernda has devoted his large business and practical knowledge, and his great political experience to- it. I would like to put the position as it occurs to me in this way : The scheme of the honorable member for Mernda, if it will stand the test of criticism, and elaborate, careful scrutiny, possesses some splendid features. It is a scheme which is well worthy of the fullest consideration. The only question which arises in my mind is, “Is it a sound scheme-“? I am not competent within the few days which have been available to me, to express an opinion upon that . subject, but I do say that the scheme is worthy of the fullest consideration. I hops that the States Governments will express their views upon it, and also upon the scheme submitted by the Treasurer. The latter follows very closely the lines laid down at the Hobart Conference of Premiers. The Treasurer has adopted very largely the view of that gathering. But there are features connected with the scheme of the honorable member for Mernda which demand the closest attention, because of the obvious advantages which would be conferred by several of his proposals if they could be carried out in fairness to the States ; and we must always be anxious to consult the financial authorities of the States in dealing with these problems. There is a little bit of bookkeeping, however, which ought to be ended without delay - I refer to the bookkeeping which relates to goods passing- from one State to another. We had a general idea that that sort of thing had been done away with. It was one of the objects of the framers of the Constitution that at the end of five years’ experience of the bookkeeping system this Parliament should be able to settle the matter. The view taken by the delegates was that, in the course of five years, we could surelv gain some approximate idea which would enable us to dispense with these differences. I do not want to look too closelv at profit and loss in matters of this sort. We shall never realize the spirit of Federation, and bring about its smooth working, until we get rid of these constant sources of irritation. At the present time there is a sort of inquisition established’ over the movements of trade which is verv much to be deplored.
– The smaller States cannot afford to depart from the existing practice.
– Surely an arrangemenl might be made. I desire that anv arrangement which may be made shall operate fairlv to the several States.
– But Tasmania and Queensland object.
– And Western Australia also.
– In establishing a basis which would avoid the existing trouble their claims should be thoroughly safe guarded.
– In getting rid of the necessity for the present system ?
– Exactly. I do not wish to bring about any arrangement which would result in injustice, but with the ability and efficiency that we have in the Commonwealth Treasury, working in conjunction with the States themselves, we ought to be able to strike some basis - upon the experience of the past five years - which would be sufficiently fair to allow us to get rid of the present obnoxious state of things.
– We have to keep some accounts.
– For statistical purposes, I suppose.
– That is all that is done between the two larger States.
– But there are a lot of entries and certificates required which practically involve as much trouble as would be associated with the payment of a duty. The Treasurer should certainly use his influence to do away with this evil. Regarding the return of revenue to the States, the scheme of the honorable member for Mernda comes in very forcibly. But the Treasurer’s scheme recognises the abnormal position of Western Australia, when it is in her interests to do so, and ignores it when it is in her interests to db so. The . very reason which makes it necessary to give Western Australia special treatment renders his proposal that Western Australia should - on the basis of a five-years’ test-
– My proposal is upon the Basis of five years preceding the 31st Decernber, 19 10.
– I am not forgetting that. But if honorable members will look at the working of the Tariff they will see that, on the basis of a five-years’ test, Western Australia would get more than she is entitled to.
– Her population is increasing.
– But, as her population increases, the rate per head will decline. The difference between the two processes is very well shown in the figures which have been supplied by the Treasurer, and which enable me to ascertain the per capita payment of Customs and Excise. I find that in 1901-2 in’ Western Australia this payment amounted to £5 16s. 4¾d., but five years later it had fallen to £3 14s. 9¾d. - a. decline of £2 is. 7d. per head. In New
South Wales, during the same period, instead of a fall of £21s. 7d., there was an increase of 2s. 5d. per head, whilst in Victoria there was an increase of 2s. 4d. per head. Consequently, if we take these returns upon a fluctuating basis, we cannot accept them in the case of Western Australia, and for obvious reasons. If we did so it might very conceivably happen that we should be ‘giving to that State a basis for a number of years which would not be fair to the other States.
– Western Australia merely wants what is fair.
– The only thing is to get the “ other fellow “ to think so.
– It is quite open for the right honorable member to suggest a more equitable plan.
– I am not endeavouring to criticise the views of the Treasurer in this connexion.
– To adopt a per capita basis would not have been proper or reasonable.
– I quite agree with the Treasurer that we could not adopt a A<er capita basis in the case of Western Australia at the present time. But after making proper allowances for inequalities we might approach as soon as possible to a per capita basis. Surely we can make some allowance for Western Australia which would bring about that result. The theory of the framers of our Constitution was that in five years we ought to be able to hit upon some scheme which would’ get rid of the necessity for keeping these accounts. I am thoroughly in favour of any scheme which will get rid of them at the earliest possible moment, and in making any arrangement of that kind we can take into account the special circumstances of Western Australia.
– It is a remarkable thing that of late years the transfer of goods to Queensland has been larger than it was formerly.
– Yes. There has been dumping from Victoria mstearl of from England. But that is part of the Federal compact. We cannot have the sweets without also taking the bitters-. With reference to the conversion of the public debts of the States. I think that all these discussions are bringing, us nearer to the adoption of some feasible plan. In this connexion I may be allowed to indulge in one personal remimscence When the Con vention was sitting, I made a desperate fight - and was successful - to induce its members to substitute the word “ may “ for “ shall.” I pointed out that if the word “shall “ were retained, all the bondholders of the States would get the benefit of the Commonwealth guarantee without being called upon to pay anything for it. At that time - as it turns out - we had exaggerated ideas regarding the difference between the Commonwealth and the State brand upon stock. I thought that it would be a monstrous thing to give the London stock-jobbers the advantage of the Commonwealth brand, and to give the Australian States no advantage whatever. The Treasurer has recently been to London, and he has made an observation in his Budget which is exactly upon the lines of the effort which I made upon the occasion to which I have referred. When the Convention was sitting we thought that there were millions sterling to be made by substituting the Commonwealth for the States brand upon stock. We thought that our present bond-holders would run after the Commonwealth bonds, and that we should be able to make a large saving for the States. But somehow Federation has not worked out in that way. Apart from the question of whether or not the Federation has worked well, it is only fair to say that one reason for this is that, individually, the States are so sound.
– There was never any doubt about that; but the holders will not surrender their securities. They will not convert.
– They will not give up something for nothing.
– According to their view, the security of an individual member of a family is as good as that of the whole family.
– It is not when it is that of a younger son, but it” “is in the case of a political family. The fact is that the security of one State is as good as that of another, and that being so, investors do not rush for a Commonwealth security.
– The Canadian experience is slightly different.
– The circumstances may have been a little different, but the Treasurer, who is in close touch with the leading financiers-
– That is all very well, but Mr. Coghlan points out that our politics are affecting the question.
– That is not surprising, since, so far as I am aware, there is no Socialist party on the London Stock Exchange. I have no desire, however, at this stage to enter upon controversial matters to a greater extent than is necessary. There are a number of subjects with which I desire to deal briefly. I recognise the great difficulties with which the Treasurer is confronted in reference to taking over the public debts of the States, and to some other schemes. The problem is a most difficult one, but the light which) has ‘ been thrown upon it by the right honorable gentleman, as well as the honorable member for Mernda and Senator Pulsford, should help us soon to deal with it. It is a matter of .great urgency, for within the next eight or nine years we shall have about £58,000,000 of States securities coming in. The moment the Treasurer or his successor can inform the House that he has arrived at some agreement with the States Governments - and I regard that as a vital point in the transaction - honorable members will be only too anxious to give effect to it.
– And if the States will not come to an agreement?
– Then we shall have to do the best we can, but an agreement ought to be possible. I have now to deal with a sudden inspiration on the part of the Government, to which no reference is made in the Budget. We have been told during the last few days - although there was no reference to the question when the Electoral Bill was before the House - that the Government, in spite of their desire to give effect to the reports of the Tariff Commission, are going to bring in some extraordinary Bill to affect the voting at the next general election. Why did we not hear long ago of this proposal ? What sudden inspiration is it? Where does” -it come from? Who prompted it? What is its object?
– To help the Labour Party.
– I do not think so. In Germany the effect of the second ballot was that eighty-five of the Socialists who were returned on the first ballot were rejected on the second, all the other parties having combined against them.
– I do not think it was quite as bad as that.
– After all, that is a personal matter, to which we should pay no reference. We have to consider, not how a system would affect any party, but whether it would tend to the convenience of the electors, and work favorably from their point of view. But the proposal that in Australia, with its enormous Commonwealth electorates, two ballots should be taken, is the most idiotic of which I have ever ‘heard.
– It is intended to wipe out “ the chartered libertine “ of the Age.
– If we really think that the present system is not the best, and that some change is necessary, it would be absurd and cruel to. cause the electors in country districts to. travel miles and miles to vote a second time, when under another system thev can by the one operation vote for every candidate in the order of their preference. I refer to the contingent vote system, which is in force in Queensland.
– That system could not be applied to elections to the Senate.
– The question is whether the honorable member’s party are going to support this proposal. If they are, it will go through ; if not, it will be rejected.
– I know nothing about it.
– My honorable friend, as the honorable member for Wide Bay, knows nothing about the intention of the party. but as a member of the caucus he knows all about it. Amongst the curious exhibitions by the Melbourne Age, that which it has given in relation to this question is one of the most absurd. The Age proprietary appear to have two different offices. In one of them a leader for publication on Tuesday is written, and in the other office another fellow, who never sees the Ace, writes one for publication on Wednesday. I am going to read the leader published in the Age of Tuesday last.
– Is the right honorable member going to read all the hard words about us?
– I am. This Government is the product of the Melbourne Age. It is the Age Government. There is no doubt about that.
– Is that so?
– The honorable member knows that it is. It is true that one of its members is an unruly colt, who shows in a number of ways that his manliness is of a much higher order than is his poetry.
– And yet he is called “ the steam-roller.”
– We may criticise the right honorable gentleman, but I am sure that we have a good deal of personal good feeling for him.-
– He does not know where he is.
– I approve of that, because it mav lead to the right honorable gentleman some day coming our way. I do not like fixed quantities. One is reminded of the difference between an old bullock in a team and a stray one. One never knows when the latter will come one’s way - it is the bullock in the team of which one cannot obtain a hold. This is what the Age, in its issue of Tuesday last, says of the party that is keeping its Government in office -
It is thus that we have a Labour Party, ignorant, inflated, infatuated and uninformed, chartered libertines in the political arena -
What should we say on that point about the Age itself? - cut off from their natural congeners, the liberal trunk, effecting no good -
– That is intended to apply to the members of the State Labour Party-.
– That is about the meanest statement that a member of “the Labour Party could make. The honorable member is trying to shift this abuse on to his brother labour men in the State arena. But unfortunately the Age makes it perfectlyclear that its remarks apply to the Federal Party.
– The honorable member was only joking.
– I recognise that. The article continues - and efficient only in arresting the true march of progress.
That being so, twenty-five honorable members who are keeping in office the progressive Government of the Aec. are arresting the march of progress. This is
One of the basest pieces of ingratitude of which I have ever heard. If the Labour Party were supporting me, the position might be different. But considering that it is supporting the proteges of the Age, this is one of the roughest comments that could be made.
– The right honorable member, had he been in charge, would not have allowed us to suffer silently and meekly.
– No. When the honorable member and his friends were under my wing, I was a nurse and a mother to all of them. The honorable and learned member and his party must recognise the sort of people with whom they are now associating.
– In that case, we must regret that we left the. right honorable member, or that he left us.
– I was going to say that the Prime Minister has spoken of the base, black ingratitude of the Labour Party. He has said that he might serve them for years, and that if they did not agree with him on one point, thev would then throw him out. B.ut this attack by the Age is the basest ingratitude of all, and it is only the pre.liminary to a development for which I am sure the Labour Party have from the first been prepared. As long as use can be made of the Labour Party, they are in the van of liberal progress, but when they decline .to submit to the domination of the Age - when they reject and scorn the Age - that journal turns upon them with the same plenitude of abuse which it has bestowed upon others. .
– I do not think that it has made any material variation.
– No, but it has varied the target. This abuse used to be showered on me alone. The article continues -
Here, too, another consideration arises which no progressive Government should ignore.
Fancy this progressive Government ignoring the Labour Party. It is a pitch of political idiotcy that only a leader-writer of the Age would be capable of -
Not only has this Labour Party run wild and spoiled the orderly development of liberal and progressive thought, but by means of the split vote in the State -
And this is where the Federal party comes in- just as in the Federal sphere -
The honorable member for Herbert cannot get over that - it has led to complete political misrepresentation, to the representation of mere minorities, and the disfranchisement of majorities.
We come now to the remedy -
If we have a compulsory voting law,, and an amendment of the Electoral Act providing against the split vote, so that all parties may be represented according to their true strength, the Labour Party, judging by the last returns, will be very lucky if it secures a dozen members in a House of sixty-five.
That reference applies particularly to the State Parliament -
These are invincible reasons for an amendment of our electoral machinery in the State in the same way that the Federal Government has decided.
Next day, having abused the Labour Party in a way that even its bitterest enemy could not fairly do - having gone beyond the range of legitimate abuse -
– What is the range of legitimate abuse?
– That beyond which the Prime Minister or I would not go. The next day this infantile series of editors, having pointed out to the Labour Party that they could get seven seats through the present ineffective state of the electoral law, published the following statement : -
It is manifest, then, that, not alone does a great political, principle depend on the passage of this Exhaustive Ballot Bill-
The reference is to the projected Federal
Bill- but the immediate party interests of Labour and of . Liberalism are equally bound up in it.
When . a newspaper in one day’s issue points out that the Labour Party has, so to speak, been “murdering” the electors because of the want of this reform, and on the following day implores the Labour Party to join with the Liberals in order to carry that reform, it . reaches the height of inconsequential absurdity which, while it may suit the ill-informed readers of that paper, passes entirely beyond the bounds of ordinary journalism. If I thought that the principle of the second ballot was good from the point of view of the electors, I should not be influenced by any considerations as to whether it would or would not suit any particular party. The only way in which this proposal, if it is a good one, can be carried out with, any regard for the electors, . is by affording them an opportunity to go to the ballot-box, and expiess their opinions on every one of the candidates in the order of their preference for them.
– Will the right honorable member be surprised to learn that, although the Age ticket polled the fewest number of votes at the last general election for the Senate, it secured the return of two candidates, whilst the Argus was unable to secure the return of any of its candidates, and the Labour Party had one returned ?
– I am not surprised at anything that happens in Victoria. But the next election will show a marvellous change. When the Age ticket loses the support of the labour protectionists and of the anti- Socialists, those nominated by that newspaper will find themselves between two stools.
– But, although the Age candidates received the lowest number of votes, two of them were returned.
– If that was so, it was a great calamity.
– The Labour Party obtained the largest number of votes, and had one candidate returned, while none of the candidates of the Argus were returned, although a larger number of votes were cast for them than were cast for the candidates of the Age, of whom two were returned.
– There is one great cure for that evil. The electors, instead of splitting themselves up into two or three parties, should make up their minds to have a straight line of cleavage between two parties. This very newspaper which is now denouncing the evil of split votes, has done more to re-introduce the evil of split politics and split parties than has any other newspaper in Australia. It fought to produce a split in the ranks of those opposed to the Labour Party, and, having succeeded, is not satisfied with its work. I believe that at the next election the great majority of the electors will take one side or the other, and will thus see that effect is given to their votes. I should like now to refer to the results of our sugar legislation upon Queensland. I am glad that the experiment of trying to produce sugar wholly with white labour is answering very much better than many of us thought it would. The figures which have been placed before us are very encouraging. But the problem is by no means settled yet, and, if it should happen that white Australian labour cannot be obtained for employment in the cane-fields, we must help the growers of cane . by introducing white labour from other parts of the world. If Australian labour will do the necessary_ work, all will be right ; but, if Australian labour, although able to, will not do it, the growers should be considered by the introduction of white labour from other parts of the world.
– It is only a question of wages so far.
– Until now the experiment has answered better than many persons hoped it would answer. Honorable members will recollect that, when speaking on the motion for the Address-in-Reply, I made an earnest appeal to the Government to carry out the deportation of kanakas with some regard to humanity. In some respects they seem to be adopting rules of which we must all approve. In accepting the” recommendations; of the Queensland Commission, they are having regard to the interests of humanity.
– And that is not being objected to.
– I have not heard any one object to it, and L am glad that the Government are taking this action. But I understand that this is the position : The Treasurer tells us - and he, no doubt, has made proper inquiry - that by the 31st December next the Government will have been able to deport 900 kanakas out of about 4,000 now in Queensland. That will leave over 3,000 in the State on the 1st January next. But, by the laws of Queensland, those kanakas cannot, from that date, work for any one in the State. They will ‘ not be able to earn a shilling after the end of this year. The people of Queensland will be left standing beside these unfortunate kanakas, unable to offer them work. This state of affairs will shock the civilized world. They will be told that these 3,000 kanakas were brought from their homes to Australia, and that now the Commonwealth - because we must take responsibility for the effect of State legislation, in this matter - penalises any one who will put bread into their mouths by giving them a shilling’s worth of work.
– Is this making the bounds of freedom wider yet? The position is an outrage upon civilization.
– It is not the policy of any one party that is responsible for it ; all parties are responsible for it. My remarks acknowledge a responsibility for our kanaka legislation equal to that of the Government. I am not trying to make political capital out of something which has already happened, which it would be easy to do after the 1st January next; I am repeating what I said oh the Address-in-Reply. .It is now August, and, while there is yet plenty of time to put matters right, I call upon the Government to save the name of Australia from universal execration, by having the law amended, so that during the ten or twelve months which must elapse before these people can be deported in a humane and considerate manner, they may be allowed to work for their living.
– Under the Queensland law the kanakas could not work after their agreements were up. They had simply to wait about until boats were ready to return them to their islands.
– It is a disgrace that it should have been so.
– Most of them desire to go back, and can be shipped away early in January.
– We are all equally responsible for our black labour policy. We have a joint stock liability, and, as sharing that liability, I implore the Government to make arrangements for the deportation of the kanakas by the 1st January, or within a month or two afterwards, and for their proper housing and feeding until they can be deported.
– There is a sum of £25,000 on the Estimates for the purpose.
– I understand that that is to provide for the £5 a head to be paid for the deportation of the kanakas.
– That has been paid.
– We are alive to our duty in this matter.
– The Treasurer must forgive me for being alive to it, too. We have libellers enough in the world, and should not play into their hands by showing a lack of consideration in this matter. I wish now to speak about New Guinea affairs. I think that grave injustice is being done to a man who occupies a most trying and difficult position - the present Administrator of New Guineas He suffers from the misfortune of not having been born in Australia, a thing which he could not provide for. Captain Barton went to New Guinea with Sir George Le Hunte, and the first Deakin Administration appointed him to succeed that gentleman.
– Not permanently - only as acting Administrator.
– That fact does not affect my argument. The Watson Administration did not interfere with the appointment, nor did my Administration. I came to know a good deal about the work which that officer is doing in New Guinea, and I consider that the way in which he is now being treated is not creditable fo the Government. If he is removed from his position without good cause, in order to place there some other person, he will have good reason to complain. If he is put out of office, not because he is unfit, but to allow some other person who is an Australian to be appointed to it, undying disgrace will attach to the Government. I wish to say, for what it is worth, that my impression of Captain Barton’s work is of the highest possible character.
– The Possession has been at a standstill, under his administration.
– Where there is a mere handful of white people, and hundreds of thousands of coloured savages, care must be taken to ascertain that the complaints of the whites are not due to the fact that the ruling authorities are doing their duty by protecting those who cannot represent their wrongs, or voice their complaints. If neglect of duty is alleged against the Administrator, he can be treated as any other public officer can be treated. I believe him to be one of the ablest and most self-sacrificing men in our Public Service.
– What does the right honorable member suggest?
– Unless a well-founded complaint can be urged against him, Captain Barton is more entitled to the office than any other person. He has given years of hard work to the service of the Commonwealth.
– And must have gained a great deal of experience.
– Yes. He has played the part of a pioneer, and it would1 Le a shame to deprive him of his appointment, except to place in his position a man of higher Qualifications.
– The only proper ground for removing him would be that he had failed to administer the affairs of the Territory in a proper way.
– That is so. I am much obliged to the honorable member for his remark. It represents exactly what I wish to convey. The idea that some other man, simply because he has been born in Australia, should be put into his place, should not commend itself to any ohe.
– How long has Captain Barton been in New Guinea?
– For some years.
– He went there in my time, or in that of the honorable and learned member.
– If the honorable and learned member or myself were in a Government billet, we should not like to have another fellow shoved over our heads. He knows how we feel when we are turned out of office.
– That does not prevent people from turning us out of office.
– I hope that Captain Barton will be fairly dealt with.
– The Government determined to take action irc regard to Captain Barton, before there was any talk of appointing an Australian, by approaching Sir William McGregor.
– That is so.
– Sir William McGregor is a very experienced man.
– There have been a number of complaints.
– I understand that Sir William McGregor does not wish to take the position. In view of the experience possessed by Captain Barton, and the hard work which he has done, it would be a disgrace if the Government were to appoint even Sir William McGregor, eminent as he is, unless some well-founded complaint - and1 I know of none - can be urged against the present administration.
– The complaint which has been made is that, since Sir William McGregor left New Guinea, affairs have been allowed to drift, and no help has been extended to settlers.
– I do not’ wish to dogmatize.
– I do not wish to do so either.
– During the eleven months that I was in office, I was constantly in communication with, and receiving reports from, Captain Barton, and I say for what the statement is worth, that he made a most singular impression upon, my mind as a man of extraordinary ability and activity.
– The dissatisfaction in New Guinea is unanimous.
– It may be due to a cause with which we should have no sympathy.
– It may prove that Captain Barton is a good man for the post.
– When a man is administering the affairs of 500 whites and 400,000 savages, the fact that he is not popular with the whites may be evidence that he is a fearless administrator, and is acting fairly between black and white.
– I think that every one will admit that his protection of the natives is to his credit.
– It is a great point in his favour as an administrator. We must all feel the greatest satisfaction that the Administrator of New Guinea, who is under the control of the Commonwealth, has a reputation for humanity in his dealings with the 400,000 savages whose destiny has been intrusted! to us. I wish now to say a word or two in reference to the Defence Forces. I am very sorry to have come to the conclusion’ that they are in a most unsatisfactory state. There is no sort of harmony in the higher branches of the service, and some of the very best soldiers Australia ever had are leaving the forces because of their dissatisfaction. I am very sorry for this. I desire to enter my very strong protest against the application of the principle of “ Australia for the Australians “ to the appointment of an officer to take the supreme command of the Australian Defence Forces. If any Australian officer had had the necessary experience to fit him for the position of Commander-in-Chief, no human being would feel any sentiment but that of pride upon seeing him appointed. Every one would hail the appointment with delight. But if an Australian is to be appointed merely because he is an Australian, I think that we shall show a disgraceful lack of regard for the lives of our soldiers and volunteers, and for the interests of our whole defence system. We must all admit that it is impossible for the Minister of Defence - and my remarks would apply equally to all previous Ministers, except, perhaps, the Honorable and learned member for Corinella, who has had considerable experience in ‘ connexion with military matters - to judge as to the military qualifications of a candidate for the position of Commander-in-Chief. I wish to know, with reference to the highest position of command in connexion with our Defence Forces, whether the Minister has obtained any expert opinion .as to the qualifications of the gentleman proposed to be appointed. If Senator Playford merely thinks that a certain candidate is the best man, I do not value his opinion more than I would value that of any gentleman in the service of the House. One of the first conditions that should be fulfilled in connexion with such an appointment is that the candidate should have given practical demonstration of his qualifications, and I should like to know whether Senator Playford has satisfied himself that there is no man in the Home or Colo nial forces whose services could be commanded at a salary such as we are able to offer, who would possess superior qualifications and greater efficiency and experience than, any man we have in our local forces. Has the gentleman whom it is understood the Government intend to appoint ever commanded large bodies of troops in actual warfare?
– He did very good work in South Africa.
– Hundreds and thousands of men did that; therefore that statement goes for nothing. I do not wish to do any injustice.
– I did not say that Colonel Hoad should be appointed ; but we ought to do him justice.
– I have no feeling of antagonism towards him.
– I do not think he cultivates acquaintances, although that has been suggested.’
– I cannot say. I only know that, as Prime Minister, I was invited to attend at the railway station at Spencerstreet to receive him after his return from Japan as an attache. I thought that that was rather a stiff thing. Of course, Colonel Hoad would not have been a party to that, but probably it was suggested by some kind friends of his. At any rate, I thought it was an extraordinary thing to ask the Prime Minister to do. If he had been a personal friend there would have been nothing extraordinary in the request. However,- I have no sort of prejudice against the officer in question, because I know nothing against him, and have not the pleasure of his acquaintance. I am speaking upon broad grounds. If any other officer had been concerned, my remarks would apply equally to him. During the operations in South Africa, scores of good soldiers had command of large bodies of men in actual warfare, and the services of one or other of these could surely be obtained. A man who has had command of large bodies of men in actual warfare, other conditions being equal, must surely be the best man for the position of commanderinchief of our Defence Forces. An officer who has not had such experience might be a good theorist, and might have a perfect knowledge of military tactics, and might, perhaps, develop perfect qualifications in a time of danger ; but-
– Twenty per cent, of the men in the ranks would make good com- manders, if an opportunity were presented to them.
– In the administration of great military affairs in time of war, we should not put in the supreme command a man who had never been accustomed to control large bodies of men.
– What about the American Civil War?
– The great curse of that war was the inefficiency of the officers.
– Hundreds of thousands of men were butchered uselessly owing to their bungling.
– The raw material of the armies engaged in the Civil War of the United States was the grandest in the world, but for two years the stronger and better-equipped armies of the Northern States were slaughtered by tens if not by hundreds of thousands, because the officers had to be trained through the shedding of the blood of those led by them.
– That applies also to British wars.
– That is my point. Owing to the experience gained in that unhappy war in South Africa a number of officers have perfected their capacity to command large bodies of men in time of war.
– We have men here who commanded large bodies of men.
– I do not think that we have any man who had anything like a large command - who was responsible for the movements of large bodies of troops.
-We have officers who have commanded regiments - I do not think that any Australian officer commanded more than a regiment.
– That is my impression. An officer commanding a regiment might be a possible Napoleon or a Wellington, but in the absence of the power of inspiration to enable us to detect that, we cannot with safety arrive at a judgment of his qualifications. The officer who has command of a regiment has to work under the brain of another man. He receives orders to move his men according to dispositions made by his superior officer. When we have offered to us the services of men who have controlled the movements of large bodies of troops, their claims ought to be considered, not in the interests of the officers themselves, but in the interests of the men whom they are to command. If two officers submit themselves, one having commanded a regiment and the other having had experience in commanding brigades of regiments, and having gone through the arduous necessities of war, the latter should, other conditions being equal, be preferred, on the ground of experience, for the position of commander-in-chief. We cannot indulge in speculations as to how men would turn out. The matter is too serious for “that. I wish to enter my strongest protest against the proposed appointment, unless the Government have taken some expert advice, the result of which is that the appointment has been pronounced a desirable one. When I speak of expert advice, I do mot refer to our own officers. No doubt they would all consider that they were equal to the task - any man worth his salt would think that. If the Government, in making the appointment, act upon expert advice, I shall have not another word to say, and all my objections will be removed; but if the officer is to be appointed because, in the judgment of the Minister - a very worthy citizen - he is competent to fill the position, the course adopted will be one of which I cannot approve. How can it be said that the present Minister is competent to judge of the military qualifications of the candidates for the position? The whole thing is preposterous. Surely, if it is important that the Government should obtain the advice of the Imperial Defence Committee with regard to the pattern of fort they should construct in connexion with our defences, it is still more important that they should obtain expert advice in regard to the appointment of a commander-in-chief for the whole of the forces of Australia. I have to thank the Committee for having permitted me to deal with these matters. I have no prejudice against Australian sol-, diers, and if Colonel Head is appointed as the result of expert advice, I shall be glad to hear the statement made, and to express my perfect approval.
Sitting suspended from 1 to 2 p.m
– I move -
That from the10th day of August, 1906, at a p.m., Victorian time -
Manufactures of Metal, viz. : -
Hand-worked rakes and ploughs com- bined, hay-tedders, maize harvesters, maize binders, maize planters, mouldboard plates in the rough and not cut into shape, potato sorters, potato raisers or diggers.
I submit this resolution in consequence of an announcement which, appears in the Argus newspaper of this morning. It is very evident that somebody has given correct information to that journal regarding the recommendations of the Tariff Commission, and this fact has forced the Government to take immediate action, with a view to protecting the revenue. I wish also to announce that, as the Government have not had an opportunity to discuss all the details connected with the recommendations of the Commission, it may be found necessary hereafter to modify the resolution which I am now submitting. But, in view of the information which has been published in the Argus, there was no other course open to us than that which I am now taking. The resolution embodies the complete recommendation of one section of the Tariff Commission.
– It is not complete.
– I understand that it is. I am about to read some other recommendations, which I could not embody an the resolution, but which will be. acted. upon by the Government. The first is as follows : -
Providing that if the retail or selling price of any implement or machine made in Australia, similar to that upon which the additional duty is hereby imposed be raised above such prices ruling in Australia during 1905 the GovernorGeneral may, in pursuance of a joint Address by the Senate and the House of Representatives, suspend the collection of such additional duty upon any machine or implement for such time as may be deemed advisable.
The second recommendation of the Commission reads -
That if the majority of manufacturers of the machines and the implements made in Australia similar to those upon which additional duties are hereby levied do not, after the expiration of one year -from the passing of this Act, pay their workmen engaged in making such machines and implements a fair and reasonable rate of wages, the Governor-General may, in pursuance of a joint Address by the Senate and House of Representatives, affirming that such fair and reasonable wages are not being paid, suspend the collection of such additional duty upon any machine or implement for such’ time as may be deemed advisable.
The third recommendation reads -
Provided that if within two years after the passing of the Act the retail price of stripperharvesters made in Australia has. been raised above £81, or if after the expiration of two years from the passing of the Act the retail price of stripperharvesters made in Australia has not been reduced to £70, the Governor-General may) upon the receipt, of a joint . Address from the Senate and the- House of Representatives certifying to the foregoing effect, by proclamation, suspend the collection of such additional duty of 12½ per cent. for such period as may be deemed . advisable.
I have read these recommendations of the Commission, but I do not say that the Government intend to adopt them in their entirety, because - and I say this without in anv way binding the Government - I am of opinion that the price named is too high. I think it is very possible that in the Bill which will be introduced the Government may stipulate for a greater reduction than is provided for in these recommendations. But, forced as we have been to take immediate action, I have brought forward these resolutions to indicate what the Government-
– Suppose that the make of the machine, in consequence of the cost, is altered.
– The resolutions are merely an outline of what the Bill mav contain, but I think that we shall endeavour to provide for all these details.
– The Government will have to make some provision of that kind.
– Exactly. I wish honorable members to understand that I have been forced into this position by a highly improper action on the part of somebody. I can give the Committee my assurance that the information which has been published has not emanated from my Department, because the recommendations of the Commission only came, into my hands yesterday, and they have been locked up ever since. Consequently somebody else must have communicated the information to the Argus, and I venture to say that, in doing so, he committed a very reprehensible act. ;
– Why do the Government exempt maize planters?
– The honorable member must understand that we intend to give effect to the recommendations of the Commission before they have been fully considered. We have not had an opportunity of fully considering them.
.- I presume that, as a necessary corollary of the Minister’s pronouncement, he will at once publish the full reports of the Tariff Commission’s recommendations regarding these items. Otherwise a certain portion of the recommendations of the Commission will still be unpublished.
– I have the report here, and I propose to lay it upon the table of the House the moment that I get a chance to do so.
– I am very glad to hear that. I would further suggest that the evidence which wag hande’d ‘to the Prime Minister last evening should be published.
– I have given instructions for it to be circulated at the earliest possible moment, and I hope that honorable members’ who leave by the’ train this afternoon will be in possession of the’ir copies before they go.
– I join with the Minister in regretting very deeply indeed that such a communication as appears in the Argus this morning should have been published. It came upon me as an astounding shock. Looking at the matter very carefully, I wish to express the opinion that, although the information appears in a free-trade newspaper, iti is not a freetrade pronouncement. It is a distinctly protectionist pronouncement upon certain recommendations which have been made by the Tariff Commission.
– Might not “that fact merely be used as a cover?
– I am not discussing that. I say it is very singular that a free-trader should have emphasized the phase of the question contrary to that which he would naturally be expected to emphasize. Be that as it may, the Tariff Commission intend holding a meeting this afternoon to see whether some understanding cannot be arrived at with regard to the origin of the particular series of paragraphs which appears in the newspaper to which reference has been made. I feel sure that if it is at all possible to trace the source pf that information, the Commission will endeavour to vindicate itself in the eyes of the public. Personally, I think that the Commission as a whole is too fully seized of its responsibilities to have wilfully made public what is undoubtedly confidential ‘information at the present time.
– I regret that the Prime Minister has not acted upon the suggestion which I made to him when the proposals in regard to the Customs and Excise duties upon spirits were submitted.
– I did, and I have been in search of the right honorable member for the last half-hour.
– I was within the precincts of the building.
– I was at the right honorable member’s room.
– I am quite satisfied, with the explanation of the Prime Minister. We all have a common interest in this matter, and wish to assist the Government to protect the revenue. Consequently there can be no possible reason why the leader of the Opposition should not be informed of the intentions of the Government. I am perfectly satisfied with the statement made by the Prime Minister. What I should like to say, in the first place, is that it would be very inconvenient if these matters were not promptly dealt with. This step is absolutely necessary for the protection of the revenue, but there is also the corollary that the collection of duties without proper legal authority should never exist longer that is absolutely necessary. There is no legal authority to do what is now being done under these resolutions, although the object in view justifies the means. Practically, we all are at one with respect to that point. I would suggest to the Government, however, that it is important, when the law is suspended, as it is by a motion of this kind, to take the sense of the Committee with respect to it as soon as possible, so that the uncertainty which prevails may be removed. I notice that portion of the motion that has been submitted goes in the direction of freeing some of the articles named from duty. Two different principles apply to the two different proposals. When it is proposed to impose a duty, it is necessary to secure the passing of a resolution to protect the revenue, . but when it is proposed to free from duty certain goods, the position is different. We do not have a resolution freeing an article from duty. The duty is allowed to remain until the matter has been dealt with by Parliament. If it be ultimately removed, no harm is done, since a refund can be made.
– I think that some of the articles in question are already on the free list.
– Most of them are, but I am not sure whether they all are.
– It would be inconvenient to embody in this motion anything that would have the effect of f reeing an item of Customs duty, because once that item is freed, it is not easy to collect the revenue so lost in the event of Parliament arriving at a decision that it should not be free. On the other hand, where it is proposed to impose a duty on certain goods, the revenue must be protected by preventing their introduction free of duty. The Government might subsequently say, “ We do not propose to allow these goods to come in free,” but, in the meantime, a large quantity of them might have been introduced.
– Some of these might be read as exceptions to the earlier variations of the resolution.
– Perhaps that is so. I am only seeking to show that there is a clear line of distinction between the two proposals.
– I wish to explain that it was only at 1.40 p.m. to-day that my honorable colleague obtained the final revise of the necessary motion, and that, as soon as I had conferred with him in regard to it, I . went to the room occupied bv the leader of the Opposition-
– Hear, hear.
– There I met the honorable member for Gippsland, but, failing to find the leader of the Opposition, saw the honorable member for North Sydney.
– I am perfectly satisfied. .
– Had the leader of the Opposition been in his room, he would have known of our intention within threeminutes of our final decision. As to the next question raised by the right honorable member, the rule is not to give effect toa proposal to reduce duties until Parliament has dealt with it; consequently, there can be no loss of revenue in that regard. Of these proposals I say nothing;, but before dealing with the point at issue, must say that, although, one cannot complain of a newspaper taking; advantage of any sources of knowledge open to it, it does seem that, in this particular instance, the line has been passed! at which it ceases to be proper for a newspaper to make public precise information which may adversely affect the publicrevenue.
– Somehow or other, the reports of the Commissioners are always anticipated.
– A newspaper could retain its priority of information if it simplyinformed the Minister of Trade and Customs that, having obtained certain, information, it proposed to take advantage of it.
– If it took that step the news would soon spread.
– It need not, and would’ not. Ministers are- constantly in possession of information which is not made public until acted upon.
– The honorable and’ learned gentleman should blame, not thenewspapers, but those who “ gave away the show.”
– I blame both. Thosewho improperly gave this information have committed an absolutely dishonorable act, and those who publish information at a time when its’ publication might adversely affect the revenue of the Commonwealth, and be advantageous to individuals, act discreditably, if not dishonorably, and unpatriotically. I wish toguard myself from the suspicion of having assented to what has beendone; for it goes beyond the necessary publication of information which werecognise as the business of a’ newspaper. I agree Avith the leader of theOpposition that no time should be lost in dealing with fiscal proposals. I have still a hope, although it is a faint one, that we may close the Budget debate thisafternoon; but in the special circumstances: of the case, and under the special pres- sure upon us, whether the Budget debate be concluded or not this afternoon, I propose to ask the House to take into consideration on Tuesday next the reports that the Government have had time to consider - the reports on spirits, wine, and industrial alcohol. I am very reluctant to postpone the Budget debate, but, in the exceptional circumstances of this session’ - circumstances to which I can recollect no parallel in my political experience - the Government feel it necessary to dispose of these reports now, and also of the others just tabled as soon as possible afterwards. The House will be invited on Tuesday next to deal with the alcoholic.
.- All this trouble has arisen owing to an attempt to delegate executive functions to a Commission. I indicated when the last motion relating to the revision of the Tariff was submitted that I knew of no method whereby the revenue could be fully protected as long as the decisions of the Commission had to be arrived at prior to the Government receiving its recommendations. While the Tariff Commission has done good work, it has! had cast upon it functions which it cannot carry out as well as can the Executive, which is charged with the administration of the Commonwealth and the protection of the revenue.
MINISTERS laid upon the table the following papers : -
Progress reports of the Tariff Commission on agricultural machinery and implements and stripper-harvesters, and minutes of evidence, vol. IV., division VI., metals and machinery.
Ordered to be printed.
Debate resumed (vide page 2695).
But for some remarks made by the leader of the Opposition as to the powers of the Commonwealth Parliament in relation to direct taxation, and particularly in regard to certain proposals made by the Labour Partv in connexion therewith, I should not have addressed myself to this question, since we shall have another opportunity later on to deal with the details of the Budget. Although I was not present at the time, I understand that the right honorable gentleman stated this morning that he believes thoroughly in the principle of land taxation, but considers that the proposal of the Labour Party to apply that principle is an outrage on the Constitution. It certainly appears to me that such language is not warranted by any section of the Constitution. At page551 of Quick and Garran’s Annotated Constitution, the power of the Parliament in regard to taxation, and the restraints upon that power, are set forth, and, although I have very carefully looked through that work, and also through the debates at the Federal Convention held in Melbourne, I can find no mention of any restraint on land taxation by the Federal Parliament. The right honorable gentleman’s attitude, while not at all curious, is rather suggestive. He says that he believes in the principle, but disbelieves in our method of applying it. He makes this statement at a time when, with . two exceptions, there is not the remotest possibility of any of the States Governments proposing a tax upon unimproved land values. . It is perfectly safe for the right honorable member to pose in New South Wales as an advocate of land values taxation through the medium of the States, since he knows very well that the Government of that State is opposed to such a tax. I understand, also, that there is little, if anv, likelihood of such a proposal being carried into effect in Victoria, except by the Labour Party. I need hardly point out that there never was much probability of such a tax ‘being imposed in Tasmania, whilst if land value taxation were passed by the Parliament of Queensland or South Australia it would in either case also be through the medium of the Labour Partv. The right honorable gentleman declares that he is in favour of the principle, but he is the leader of a party which throughout the Commonwealth is most vehemently opposing it. I shall never permit him to parade as a man who is in favour of this principle while he is the leader of such a. partv, which, by virtue of its necessities, its open professions, and its notorious intentions, is opposed to it. The leader of the Opposition savs that the principle is sound’. He told the honorable member for Gwvdir that he was entirelv jn svmoathv with his endeavour to burst up big estates, but yet we find him leading a partv whose sole reason for existence is that thev have set their faces against any interference with vested interests in the Commonwealth. The right honorable gentleman now attempts to pose - with a shadow of that wreath which he wore around his brow, when some ten years ago he favoured land value taxation - to pose as the leader of men who have advocated that principle, and yet we find him and his party being supported by those who wish things to remain as they are. What, then, becomes of the honorable member’s objection to the proposal of the Labour Party, that it is an outrage upon ‘the Constitution, but that if such a proposal were made in a State Parliament he would ardently advocate it? I do not hesitate to say that the same men who are behind the right honorable gentleman to-day will be behind every movement for reaction throughout the Commonwealth, whether it be in the municipal, Federal, or State sphere. There is -but one party now - the great Anti-Socialist Party, the party of vested interests - and the right honorable member! for East Sydney has been selected as the most effective instrument to accomplish their purpose, which is, in so many words, to “ leave things as they are.” They think that this ds the best of all possible worlds. These men who have great interests in this country, who count their possessions, not by hundreds, but by thousands and’ tens of thousands, declare there is no necessity for change. It is quite true we “have an overflowing Treasury, but by a singular and sinister coincidence, on the very day that the Treasurer ‘ told us that we were or. the crest ‘ of a wave of magnificent prosperity, an evening newspaper published a ‘ report of the direst’ distress iii this great city. Unhappily, it is not confined to this city. You can find it in Sydney, Brisbane, and the other large cities of the Commonwealth ; but it is not even confined to the cities. Were it not for the fact that thousands of men are able to make a living by trapping rabbits, the distress in the country would be deplorable. In the face, of these facts, the right honorable gentleman says that the proposal of the Labour Party to impose a land tax, thought he is in favour of the principle, is an outrage upon the Constitution. He knows that the principle, so far “as the’ States are concerned, is in arti’culo mortis, that not a State in the Commonwealth has any present intention to give effect to it. If it were put into effect by any State, it would be a State in which the Labour Party, which he denounces and intends to annihilate, if the gods will, at the next election, has the control of affairs. Half the alienated land of New South Wales is in the hands of a little more than 700 persons, and yet he says that we are to do nothing. He is leading an army whose watchword at the next election will be “ Do nothing.” Their whole policy is to crush the La”bour Party, whose one offence is that they propose the imposition of a tax on the unimproved value of land, for the purpose of bursting up the big; estates.
– That proposal is a pure sham, a piece of political hypocrisy.
– The simile of Satan reproving sin fails to express my surprise at an interjection of that sort from the honorable member. Until now, he has been an unceasing advocate of the great principle of land value taxation.
– I still am; but I advocate an honest land tax.
– The honorable member is allied with a party whose one principle it is that no attack shall be made upon the vested land interests of the country. The right honorable member for East Sydney affects to regard our proposals as unconstitutional, while some of his followers take exception to the method of their proposed application. Some of them say that the tax would be a good one if there were no exemptions, some that the rate should be higher, and others that the rate should be lower. The right honorable member must bear on his shoulders responsibility, not only for what he himself says in regard to this matter, but also for what the members of his party say. Their views arte being scattered broadcast over the country, through the medium of the daily press, which declares that the intention of the Labour Party is nothing; more nor less than the first step towards the confiscation of all property. I shall not be silent under such an imputation, nor do I think that it comes well from the right honorable member, seeing that through him the Labour Party in New South Wales obtained their opportunity to put into force an infinitely more severe tax than that which they now propose.
– A more severe tax?
– TheNew South Wales tax is only id. in the £1.
– It is a matter of figures, and if honorable members trouble to make the necessary calculation, they will see that my statement is correct. The exemption in New South Wales applies to land not exceeding ^240 in value ; but the rate actually imposed on all land exceeding that value makes the tax up to, say, ^20,000 infinitely more severe than that which the Labour Party now propose. .
– is the proposed tax to take the place of the existing tax?
– No. We propose to do that which the honorable, member for Parramatta was at one time . prepared to do - to make the new taxation additional to the present tax. The honorable member at one time did not propose to stand, like Lot’s wife, immovable. The imposition of a id. land tax was to be the first step in a glorious career. Now, however, he goes pale and cold when the subject is mentioned, and looks back upon the step which he took as, perhaps, a false one, but certainly as the only step which he will take. My position is different. After an interval of twelve years, I think that it is time to take another step, which I am prepared to defend on the grounds whereon I defended the first’” step. We were told then we were undermining the Constitution, and that the forces of society would rise up and crush us. I remember how the right honorable member’s supporters looked with approval when he waved his arms defiantly towards the serried phalanx of Legislative Councillors sitting behind the Bar. But those men, who represent the vested interests of New South Wales, are now his staunchest friends. He tells us, and would have the country believe, that he is the same old George in this matter, and, if he had his way, would impose a land tax ; but, by a stroke of malign fate, he finds himself in a sphere in which it is not constitutional to do so. But this is a device as old as the hills. The enemies of reform never meet the reformers straight out. From the beginning, the reformer has had to fear, not the blow of the broadsword of the soldier, but the stiletto of the assassin. In New South Wales, where 700 men own one-half of the alienated land, there are 500,000 landless persons out of a population of 700,000 adults.
– New South Wales has a Closer Settlement Act.
– Can we consider the situation calmly when we know that immi grants are avoiding Australia because, as Mr. Coghlan, an impartial critic, declares, there is no suitable land available for immigrants here. The people of New South Wales can obtain, land for closer settlement only by putting their hands into their pockets and buying back at high rates what in many cases was filched fi om them. What is at the back of the New South Wales land scandals? Is there not some sinister and powerful influence which no man has the courage to attack or the power to overcome ?
– Those who were at the back of them were the members of the Government supported by the party to which the honorable and learned member belongs.
– By what party are they supported now, when some of the figureheads stand exposed to the gaze of an accusing and disgusted world?
– The honorable and learned member helped to put into office the Ministers who have been responsible for these scandals.
– My offence in the eyes of the honorable member is that I turned him out, not that I put them in. Even if I did as he alleges, is .he prepared to say that, while I was in the New South Wales Parliament, the Government of the day were guilty of the actions of which so much has been heard? The evidence taken, before the Royal Commission does not show that that is so. The honorable member was a colleague of several of the members of the present New South Wales Government, but does he therefore hold himself responsible for all that they have done ? Not at all. Why, then, should I be held responsible for all that the honorable, member declares the Labour Party of New South Wales- have done? Why should I bear their alleged sins? I am dealing now with facts. It is a fact that! there are 500,000 landless persons in New South Wales in a population of 700,000 adults. The Labour Party proposes to give them a chance to obtain land ; but the leade’r of the Opposition says that, in doing so, we are going outside our sphere. Our sphere is to do good, in the world, and to break down monopolies.
– When there was a proposal to uncover these scandals, the honorable and learned member’s colleagues, including the honorable member for Gwydir, voted against it.
– Because it was a pretence and a hollow mockery, as the honorable member is.
– I do not profess to be conversant with all that has occurred in the New South Wales Parliament since I ceased to be a member of that body, nor is it pertinent to my argument. I am not, nor is my party, any more to blame for certain action taken by some members of the New South Wales Parliament who belong to the Labour Party, than is the honorable member for the actions of other persons in the New South Wales Parliament who belong to his party. All I know is that the right honorable member for East Sydney is in this Parliament, with the honorable member for Parramatta and others behind him, and that he is now opposing the only system by which land monopoly can be broken down. He tells us that we are going beyond our sphere. But I contend that that is not constitutionally true. . Moreover, I declare that it will not be inexpedient to do as we propose. We have been asked by all the States to do something to attract immigrants to this country, and we are requested by our own people, who are every day crying out for land, to do something to burst up the big estates. The right honorable member for East Sydney says that he believes in obtaining the land that we require in a legitimate way. Is that which we propose an illegitimate way ? The right honorable gentleman is the very man who started this brand of illegitimacy when he introduced his land value taxation measure in New South Wales.
– The same principle was in operation in South Australia before that.
– It is all the same. He either established the system, or ‘he followed the example of South Australia. Now, however, he declares that it is illegitimate. I contend that it is the most legitimate and effective method of bursting up the big estates, and I affirm, moreover, that it will do no harm to any one except to those who are gorged to the maw with land which they neither use themselves nor permit others to use. When honorable members opposite speak of the ruin that is to be wrought by means of taxation proposals such as we contemplate, I presume that they refer to the 722 large landholders in New South Wales, who own the best lands of Australia. However, I shall say no more upon that mat ter. I am content with having shown that the right honorable member for East Sydney, when lie talks about our proposal as being outside the sphere of Federal politics, is saying that which is absolutely unwarranted. As a lawyer, he must know that no land in this country was ever sold outright, but that the Crown has always the right of eminent domain. He knows, further, that he is perfectly safe in advocating land value taxation, whilst, at the same time, he is doing all he can to “ down “ the party that is in favour of it. Those gentlemen who call themselves single-taxers are allied to the party whose whole intent and purpose is to bolster up the man who has the land, and to “ down “ the party which means to tax it. Under these circumstances, we cannot believe that these singletaxers are earnestly desirous to apply the principle of land taxation without exemption. If objection is taken to the method of the proposed taxation on the ground that the land should be taxed without exemption, why do not honorable members introduce a counter proposal? I declare that if they introduce a proposal better than ours we shall go over bodily and support their scheme. Our one object is to burst up the big estates.
– Will the honorable member vote to do away with the exemption?
– On that bright and shining morning when the honorable member shall move in this House that land taxation without exemption shall be the method by which the Commonwealth, shall obtain her revenue or burst up the big estates, he will find - if lie has the courage to call for a division - that I am sitting beside him. I always have been, and always shall be, in favour of that. But since we believe that it would be an admirable thing to burst up the big estates, and think that a man has enough when, he holds land worth ,£5,000, we propose to tax all those whose holdings exceed that value. How much would a man with £10,000 worth of land have to pay by way of taxation under the proposed scheme? I have here a newspaper article which contains an extract from a circular issued by a Mr. Cameron, in connexion with the Queensland Anti- Socialistic League. He says -
I need hardly point out the necessity for action to be taken in this matter (Federal Land Tax). Already the Federal Premier, Mr. Deakin, urged thereto by the leader of the
Labour Party in the Federal Legislature, lias expressed his approval to the introduction of a Federal Land Tax. .
That is news to me, but no doubt it is all right.
It is suggested that the amount of this tax should be is. in the £1.
That is the usual exaggeration.
– The honorable member for Bland stated that, if necessary, he would impose a tax of is. in the pound.
– He is not the Labour Party.
– I am not responsible for what the honorable member for Bland may have said.
– He is the leader of the Labour Party.
– He has never fathered the statement.
– Yes he has. He did so at the Sydney Labour Conference.
– He was misreported.
– The anti-socialistic circular to which I have referred contains the following table: -
That would be for a farm of 80 acres. The persons who compiled the circular must have known full well that no land tax was levied by the State Government of Queensland, and that it was not proposed to levy the Federal land “tax upon anv property, the unimproved value of which was less than £5,000, and that, moreover, the proposed tax. was to be½d. in the £1, and not is. in the £.1. I do not hesitate to declare that the attitude assumed by the right honorable member . for East Svdnev would not deceive an infant. He stands here now as the avowed opponent of land value taxation, as the avowed champion of vested interests, and >the avowed selected champion of the anti-Socialist Party, and by no twisting or manoeuvring can he get out of that position. We pin fiim down to that. He is the declared enemy to the re form movement in Australia, and by that he must stand or fall at the next election.
– The intrusion into the debate of the question of land taxation, to which no reference is made in the Budget statement, will not cause me to stray from the track for more than a few minutes. In reply to the honorable and learned member for . West Sydney, I would point out that the measure introduced into the New South Wales Parliament by the right honorable member for East Sydney provided for a tax of id. in the £1, but not without exemption. At that time the Labour Party, with which the honorable and learned member was connected, resisted the exemptions which were provided for. To-day the honorable and learned member, who stated that if the honorable member for Parramatta would introduce land taxation proposals with no exemptions he would support him, is now advocating a scheme which provides for extremely large exemptions - exemptions which are totally opposed to his own principles.
– The honorable member must admit that the position under Federation is slightly different from that under the States.
– There is no difference whatever. If the Federal Government has power to tax land worth more than £5.000, it also has. power to impose taxation upon property of less than that value.
– We must leave something for the States.
– The Labour Party are acting without any consideration for the States. There was an excellent reason for the introduction of the land taxation proposals into the New South Wales Parliament. At that time a state of affairs existed which I do not think obtained in any other part of the world. All the land outside of the municipal areas, which were very small, was not subject to *the payment of one penny of taxation by way of return for the benefits derived by the owners from the expenditure upon roads, railways, and other public works. Surely, then, there was a reason for the introduction’ of the measure to which I have referred.
– Most of the land in Victoria is in much the same position as the honorable member has described.
– That is totally incorrect. We have our municipal taxes all over Victoria.
– What is the declaration of the leader of the Labour P arty to-day ? He does not desire to raise revenue; he purposes that the Commonwealth shall assume the dutv of deciding the land policy of the different States.
– The honorable member might quote the actual words used by the honorable member for Bland. He stated that the primary object of the proposal would be to break up the large estates, but that the revenue would be considerable, notwithstanding.
– The honorable member is referring to an addition that was made at a later stage.
– In his first statement, the honorable member for Bland said that the proposals were intended, primarily, to burst up the large estates.
– I have read the printed words of the honorable member for Bland, to the effect that he did not propose taxation for revenue purposes, but with the object of breaking up the large estates.
– I know what was stated on the first occasion, whatever may have been reported.
– I only know what the honorable member was reported to have said. He has not denied it. However, if I accept the assurance of the honorable member for Wide Bay that it was stated that the primary object was not revenue, but policy, that means that it was proposed to take away from the States the management of their own land policies. It was intended that the superior authority, with greater powers of taxation than the States, not as regards la-nd merely, but generally, should impose taxation, not for the purposes of revenue, but with the object of deliberately taking away from the States the control of their land policies. I have no hesitation in saying that it was the intention of the Constitution to leave that matter in the hands of the States. I wish to point out that the Labour Party of New South Wales - and I speak of that State because the honorable and learned member for West Sydney specially referred to it - although thev did not, in the first instance, support the Closer Settlement Bill, afterwards gave their adherence to it. In reply to the objection raised that it would be unfair to the owners of property to provide for the resumption of their land by the State, it was urged, and very properly so, that it was not unjust when it was necessary, in the public interest, for the State to step’ in and pay an owner a fair price for his land. That was what they argued then, but now they are turning round. The closer settlement measure referred to is in force now in New South Wales. And yet the members of the Labour Party, instead of depending upon it for such resumptions as *re necessary, entirely renounce their previous statements that the owners of land shall be paid for that which they have honestly owned, and propose to tax the owners till they dispossess them.
– Was not the bursting up of big estates one of the objects with which the right honorable member for East Sydney introduced his land taxation measure?
– I never heard of such a policy being advocated by him in that regard. The proposal was for a revenue tax, which was to be paid by owners in return for benefits received by them.
– But there was a distinct object in view, namely, to prevent the holding of large estates for a long period.
– If that was the object in view, why not let the tax operate?
– We find fault with the right honorable member for East Sydney, and the right honorable member finds fault with the Labour Party.
– No. doubt the right honorable member for East Sydney did say that if there were no taxation upon land, it would tend to the aggregation of large estates.
– He said a little more than that.
– The Labour Party now propose to put an impost upon every estate throughout the Commonwealth, in addition to the State taxes and the shire taxes. The honorable member for Parramatta has just handed me a quotation in which the leader of the Labour Party is reported to have said that he was prepared to support the imposition of a tax of several twopences in the pound
– Where did he make that statement ?
– At a labour demonstration, at which speeches were delivered by members of both the State and Federal Legislatures. Then we have been called upon to emulate the example of New Zealand. In this connexion, I would point out that the graduated Land tax proposed by the Labour Party is much higher than is the tax in New Zealand. It begins at £d. in the pound, and progresses at the same rate, whereas the New Zealand tax begins at one-eighth of a penny in the pound, and progresses in a similar ratio. Then it must be recollected that New Zealand has iii its own hands the land policy of that country. There is not a Federal Government there, and it does not pile a third tax on to a State tax and a shire tax, and consequently it is impossible for us to institute an analogy between its position and our own. But behind this proposal there is a desire to bring about land nationalization. The intention of the Labour Party is not to stop at dispossessing the owners of big estates, but to nationalize the whole of the lands in Australia. The honorable member for Gwydir would not refer- to that matter. He said that that was not the policy of the Federal Labour Party. Need’ I point out that it is the policy of a branch of the same party. The two bodies meet in conference, although they decide upon their State and Federal platforms separately.
– Thev do not meet in conference.
– Was not the honorable member for Bland present at the Victorian conference, and did he not endeavour to induce that body to alter its proposals?
– The South Australian organization has not adopted the principles which were adopted by the Victorian conference.
– I do not know anything about that. I wish also to point out how crude is the proposal to levy a heavy progressive land tax upon large estates. In the first place, the taxation upon amounts which might be regarded as considerable is comparatively small, but as it progresses it becomes exceedingly heavy. What estates will the imposition of such a tax force from the hands of their present owners? Will it not Le those estates which pay the least - estates such as exist in the western portions of New South Wales, and which give their owners very poor returns? The tax may be levied upon the value of the land ‘ during good seasons, and as the result of its operation during bad seasons, the holders of these lards may be compelled to sell.’ Of what use would such lands be .for the purposes of closer settlement? It would be cruelty to put small settlers upon them. Whilst the. proposed tax may make the better class of lands groan under the burden, it will not dispossess their holders. But the owners of the poorer lands in the drier areas will be forced to part with them.
– If the lands are very poor, their values will fall within the amount of the exemption.
– But their values may be assessed in good seasons. As a matter of fact, the assessment of the western lands of New South Wales - as the result of an inquiry by a Royal Commission - have recently been reduced, because they were made during good seasons.
– I do not think that the proposed tax would touch the lands to which the honorable member refers.
– It would certainly not touch the rich lands. That fact is proved by the experience of New Zealand. In that country, these rich lands ‘ yield, owing to the steady rainfall, a regular revenue, but the progressive land tax has not effected the dispossession of their holders. Such a tax in Australia would simply force the poorer lands out of the hand9 of their present! owners, and - as they would be useless for small settlers - they would merely become breeding grounds for vermin. Coming now to the Budget itself, I wish to say that the Treasurer has brought before us some very large problems connected with ‘the finances of Australia. The approaching termination of the bookkeeping period makes his Budget a very important one. I think that the attention of the Committee should be called to this matter, so that we may decide whether we shall continue to drift under our present conditions, or whether we shall approach’ nearer to a real Federal union upon safe financial lines. The memoranda prepared by the Treasurer and the honorable member for Mernda - whose financial ability I acknowledge - are of very great assistance to honorable members in considering this subject. Their schemes have evidently not been framed from any party stand-point. While we may take exception to those schemes, we must acknowledge the very close study which their authors have given to this question. Of course, it is much easier to object to a scheme than it is to formulate one to which no exception can be taken. The Treasurer has stated that he would welcome any suggestion that might be placed before him in this connexion. For that reason, I have given some attention to the matter, and I desire, as briefly as possible, to place the result of my labours before the Committee. I regret that the Treasurer has not put forward anything in the nature of a proposal for the prompt abolition of the bookkeeping system.
– Does the honorable member mean before the period covered by the Braddon section?
– I mean at once. That provision was made in all good faith and for good cause. It has fulfilled its part. We know now what .is the effect of the bookkeeping system, and we can see how far any departure from that system would affect the different States.
– The system is not a source of very much trouble.
– It is a source of enormous trouble to persons who have to pass entries for goods. The goods cannot be checked, and consequently there is no guarantee that the full returns are given at all. As a matter of fact, so much trouble is involved, that in some cases, I am sure, the goods are forwarded without the information required under the existing system being obtained.
– Between New South Wales and Victoria, very little trouble is experienced.
– If it is desired to forward suits of clothes, for example, it is necessary to ascertain the duty paid upon the buttons, bindings, cloth, linings, &c, to pass a number of entries, and upon the figures supplied the financial adjustment is made.
– And it is all against the smaller States.
– Yes. I quite agree that there must be a considerable amount - which is not accounted for - due to the smaller States. Persons who are obliged to pass entries for goods which are being forwarded from one State to another, tell us that the operation is infinitely more difficult to-day than it was prior to Federation.
– It involves the employment of an increased staff.
– Not as between Victoria and New South Wales.
– If a good arrangement can be made between two States, why cannot a similar arrangement be made between all on a per capita basis? Having ascertained what would be the effect upon each State of a per capita distribution of the Customs and Excise revenue, the time has surely arrived when, even if there is a loss by one State or another, as long as that State can afford it we should be prepared in the meantime to face that loss. Events such as the growth of population in one State or another will cause a variation from year to year, and we should accept any immediate loss in a truly Federal spirit, and try to some extent to spread the burden.
– Would the honorable member apply that remark to Western Australia ?
– I should grant special consideration to Western Australia, because I recognise that, having regard to its small population, we could not expect it to bear what we can expect of the larger States.
– The honorable member would also take into account the fact that it is receiving nothing out of Federation ?
– I shall not say that it is receiving nothing out of Federation.
– New South Wales is getting all of it.
– I do not think it is; but still Western Australia is not deriving as much benefit from Federation as some of the other States are. . I have prepared the following statement of my proposals : -
That the book-keeping system terminate on the completion of the five year period, and the distribution among the States of surplus Customs and Excise revenue on a fer capita basis be adopted.
The book-keeping system was only intended to be in operation temporarily. Its usefulness as a safeguard against the too severe dislocation of the finances of some of the States, and as an indicator of the course of trade, can now be estimated. Its cost to the Department of Customs and to the public ; the enormous labour and worry involved ; the complexity of analysis when the component parts of some manufactured article of Inter-State trade are subject to different duties; the difficulty of attaining even approxi- mate accuracy in the returns rendered to the Customs, and the impossibility of any thorough check by the Customs without a large staff, and border Custom-houses, can also be appreciated. As a precaution, when what was regarded as more or less a step in the dark was being taken, its adoption was justifiable, but its continuance after it has yielded its information is not desirable unless it be shown that, without it, seriously inequitable results would arise.
It is submitted that any reasons which can be given for its continuance now would be almost certainly applicable to any future proposals for abolition, and, if they are to have sway, a most objectionable handicap on Inter-State exchange will be permanently grafted on “to Commonwealth finance. On these grounds, as well as for the simplification of the financial system, the removal of the present uncertainty as to the amount which the States may expect to receive from the Commonwealth, and the cessation of the necessity for the Commonwealth - when requiring extra revenue - having to raise four times the amount, and to hand over three-fourths to the States, which the latter may not need, the following is proposed : -
That there be a -per cafita distribution of Customs and Excise revenue after the expiry of the book-keeping period. This is a distinct proiosal independent of any decision regarding the Braddon section.
As a further proposal dealing with the Braddon section, it is suggested that when the fer cafita distribution begins, the operation of the Braddon clause be suspended, if it can be legally done by agreement with the States; or failing such agreement, it be allowed to lapse at the end of its present currency. When it is suspended, or lapses, a fixed sum of, say, £6,783,959 of Customs and Excise revenue be returned to the States. This is a sum between the Treasurer’s estimate of the three-fourths share of the States of Customs and Excise revenue in 1906-7, and his estimate of what they may actually receive in the same year.
As the Commonwealth must soon absorb all its quarter of the net Customs and Excise revenue, and as, in the proposed distribution, what will probably prove, during the next few years, to be three- fourths or over, has been allotted to the States, the latter are not likely to lose by this arrangement, especially as without agreement the Commonwealth can use, or deal with as it sees fit after the Braddon clause expires, the three-fourths now allocated to the States, and that even without making any provision for the debts. The effect on the 1906-7 estimate is shown in the following figures : -
Under my proposal, as opposed to the Treasurer’s estimate of distribution, New South Wales would lose , £351,190.
– That is a big loss.
– And, as a representative of New South Wales, I am supporting it. Then, again, under my scheme, Victoria would lose £25,225. On the other hand, Queensland would gain £103,582, South Australia would gain £100,101, Western Australia would lose £59,136 and Tasmania would gain £66,542.
– Why should Western Australia lose anything, as compared with South Australia and some of the other States ?
– She could well afford it.
– She would lose under a Tariff of herown, because her population is changing.
– I have come to the same conclusion as the honorable member has in regard to a sliding scale for Western Australia.
– I am pleased to hear it. My statement continues -
The foregoing comparison is based on a lower return to the States than that estimated by the Treasurer for 1906-7.
– I am going to give the States what they receive already.
– Under the right honorable member’s scheme we should _ have to continue to do so for all time.
– I am afraid that the right honorable gentleman is not extending to my proposal that consideration that he promised to give to any scheme that might be submitted -
The proposal in the first comparison shows a gain of revenue to the States whose finances have been most strained by Federation, and a loss to the larger States, especially New South Wales, also some loss to Western Australia, which includes her loss by the abolition of the special Tariff and would probably occur were she under a Tariff of her own. It was recognised before Federation that theper capita division that must sooner or later come would probably mean a loss to New South Wales, and the loss was generally estimated as very much larger than that shown herein. Against the loss must be placed the relatively larger increase of population in New South Wales, which, if continued, will, on a fer capita distribution, give her a larger proportion. There is also the probability that her coal, and large population, will bring a more than proportionate increase in home production, and consequent reduction of the consumption of dutiable articles, and of the duties returned to her, as well as an increase of her debit for Inter-State adjustment were the present system continued. Then if, as is probable, the Commonwealth undertake old-age pensions, New South Wales will have her revenue freed to the extent of, say,£500,000 per annum, and Victoria, say,£200,000 per annum.
It is quite true that New South Wales would make a considerable loss in the one year instanced, but as, under the existing method of distribution, there are considerable fluctuations, that loss would vary, and in some years might disappear. It was always urged before Federation that under distribution on a -per cafita basis New South Wales must necessarily lose, as compared with some of the other States, and the estimated loss at that time was infinitely greater than would result under my scheme. Under present conditions, I think that she can perfectly well bear the loss that I have indicated. It has to be remembered that, if she increases her population in larger proportion than the other States, as she has been, doing lately, she will obtain a larger proportionate return of revenue on a per capita basis. Then her manufactories, having regard to her coal supplies, are sure to increase. This will lead to a reduction in her consumption of dutiable goods, and consequently to a reduction in the Customs revenue returned to her. Further ora, if the Commonwealth, as is proposed, adopts an old-age pension scheme, she will be relieved to the extent of. about£500,000 per annum, and Victoria will receive relief to the extent of ^200,000 per annum. I make two distinct proposals, one of which relates merely to what should be done in the event of our discontinuing the bookkeeping system and adopting the per capita distribution, the other combines that with the suggested amendment of the Treasurer of the Braddon section. The last figures I gave show the result of taking the Treasurer’s expected surplus and distributing it per capita, instead of on the present basis. But there is another proposal. I propose to take an amount in order that, if possible, we may arrange for the suspension of the Braddon provisions. Whether that is constitutionally possible by agreement with the States, I cannot say.
– They will not agree.
– They might agree if they were secured for that amount. I propose that £6,700,000 - a sum between the three-fourths to which the States are entitled, and the amount which the Treasurer expects to return to them in 1.906-7 - should be set apart for this purpose. We cannot profitably take over the debts of the States at- once. We cannot convert’ them and make them Commonwealth debts. It would be an absurd thing to- try to do so, and would be of no advantage, except to the present holders of stock.
– We can only look to their ultimate maturity.
– It can be done only as the debts mature.
– The Constitution must be altered to allow that to be done.
– Not necessarily. It may be done with the consent of the States.
– I am inclined to think with the honorable and learned member for Northern Melbourne, that, under section 105, if anything less than the whole of the debts existing upon the inauguration of the Commonwealth are taken over, they must be taken over on a per capita basis, and that cannot be done, if we convert them only when they fall due. I think, therefore, that that section requires alteration. But there is nothing to prevent the adoption of the very good plan suggested by the honorable member for Mernda.
– He would take over the whole of the debts.
– I do not propose the taking over of the whole of the debts, but the partial adoption of the honorable member’s scheme. Instead of taking over the debts, which we cannot profitably do, we might make ourselves responsible for interest, as the honorable member for Mernda suggests, and the amount to which I propose that we should make ourselves .responsible for interest is £6,700,000.
– If we make ourselves responsible for interest, the effect will be the same as if we took over the debts.
– In what way ? .
– I understand the honorable member to say that, in place of taking over the debts one by one, as they mature, we should make ourselves responsible for the interest upon them. That would have the same effect upon the market as the taking over of the debts themselves.
– No; the honorable and learned member is wrong in that. Under my proposal, and under that of the honorable member for Mernda, if modified a little, the States could, if thev chose, pay the interest themselves, and allowance for the payment could be made in the Commonwealth figures.
– Or it could be paid through the High Commissioner’s office.
– What would be the difference between the Commonwealth making itself responsible for the debts of the States and taking over the debts?
– The Commonwealth would not be responsible to the bend-holders ; it would be responsible to the States for the payment of a certain amount, just as it is now.
– That would be equivalent to taking over the debts of the States.
– It is all that the bond-holders would want.
– The bond-holders already have the security. For instance, some of the States receive from the Commonwealth more than the amount of the interest which they pay.
– But, under the honorable member’s proposal, the Commonwealth would guarantee to pay interest on the debts of the States.
– We should undertake to pay interest out of the States portion of the revenue, or to make an adjustment with the States in regard to it.
– Has not the honorable member overlooked the fact that the Constitution provides that the Commonwealth shall come to the aid of any State which is in default, and that,, therefore, the credit of the States is absolute?
– I do not know whether there would need to be an alteration of the Constitution to carry my proposal into effect. That would be a matter for the law officers of the Crown to consider. But, instead of returning threefourths of the Customs revenue, we should return a fixed sum, and, so that the States might be secure, would agree to absorb it in the payment of interest. The main point, to which others are subsidiary, is this : I propose, as the honorable member for Mernda proposes, that the sum shall be fixed. He has mentioned £6,500,000, but I am able to be more liberal, and put down the amount of £6,700,000, because I do not propose that we should provide for the whole of the debts as he does.
– The honorable member would leave it to the States to provide the balance of the £8,500,000 payable annually in interest.
– Yes. The honorable member for Mernda goes further than I do, as I fear that there may be some hampering of our finances. Therefore, I would simply allot the fixed amount which I have named, which is about what the States expect to get.
– Would the honorable member allot that amount for a term of years ?
– It would be a fixed sum, to be absorbed by interest. I propose that the Commonwealth should float loans for the States as they require them, either for renewal or as new loans; but the Commonwealth alone should be allowed to go to London.
– Does the honorable member make that a condition?
– If the revenue from Customs and Excise increased very much, would the honorable member give the States any more?
– We could do as we chose about that.
– That would not be in the agreement.
– It would not be in the agreement
– Would there not need to be an occasional revision and alteration of the amount?
– The Commonwealth should be free in time to deal with its own finances. Having done all that the Constitution contemplates, and absorbed a very large sum in the payment of interest on the debts of the States, or credited the States with a sum which would enable them to pay interest, the Commonwealth should be perfectly free. We have every reason to know that the States will be considered, but. having been guaranteed to the amount I have named, and the rest of the debt being gradually taken over as it falls due - which would be part of the arrangement - the States would have got all that they could properly expect, and the Commonwealth, having given them all the security which they could reasonably ask for, would be free in regard to its own finances. It must have such freedom sooner or later. We cannot always be bound by conditions. I have not time to deal with these matters as clearly and fully as I should like; but my memorandum in regard to the debt and to the transferred properties will give honorable members information as to exactly what I propose.
– The matter is sufficiently important to justify the honorable member in taking his time in dealing with it, even though a week were required.
– I am merely briefly outlining my proposals now, but when honorable members read them as I have set them forth at length, thev will see clearly what my intentions are. The Treasurer makes no provision in regard to the transferred properties.
– I have already done so. I gave my views on- that subject before.
– I used the argument at Hobart, that, as the properties have passed only from one trustee to another, there need be no payment of compensation. The States, however, contend that there is a difference in the per capita value of the property, it being less in some States than in others, and that, having gone into partnership, they should each be credited with what they put in as partners. Personally, I do not see any serious objection to the proposal of the Treasurer as regards dealing with balances only, though the States have absolutely refused to ac- cept it. Of course, we can override their decision, but if we can come to an agreement with them under which their requirements’ will be fulfilled, and they will be satisfied, we should try to do so, providing that we do not injure the finances of the Commonwealth. They argue also that part of their debt was created in providing for properties which have been transferred to the Commonwealth, and that it is not fair that that portion of their debt should remain, or that they should be liable for that portion of their debt and interest, after having parted with the use of the properties in regard to which it was incurred. Some of them would like to get cash for their properties, but that idea, is now generally abandoned. It would be a most improper method of settling the matter. I suggest that the transferred properties should be paid for by the Commonwealth taking over the debts of the States, proportionately to the properties, as they fall due, at the rate of £1,000,000 per annum. Of course, there would not be £1,000,000 worth of debt that could be so treated falling due every year, but we could arrange for the transference of the States debts to the Commonwealth at that rate.
– How would the honorable member distribute the indebtedness? How would the honorable member arrange in regard to the individual States?
– The debt taken from each, State would be proportionate to the properties handed over, and the interest would be distributed -per capita. The trustees of the property would in this way have the debts incurred in connexion with it transferred into their own names. What I propose could be done without a strain’ on the Commonwealth, and the interest on the debt would be paid out of the Commonwealth share of the revenue, instead of out of the States share.
– The transferred properties of some of the States are worth more than those of the others. How would that difficulty be met?
– The transferred properties would be paid for by the transfer of the debts. If the Victorian properties were worth ,£4,000,000, Victorian debts to that amount would be transferred to the Commonwealth, and if the South Australian properties were worth £.1,500,000, South Australian debts to that amount, as they became due, would become Commonwealth debts.
– But how would the £1,000,000 be distributed annually?
– There would be no annual distribution, but an amount would be devoted for the purpose at the rate of £1,000,000 per annum. We might have to wait two or three years for a debt to fall due which would absorb the amount available. We take up the debts of the States until the whole of their claims for their transferred properties are obliterated. They will become the Commonwealth debts, and the interest and sinking fund will be provided for out of the Commonwealth share of the revenue. I do not go as far as the honorable member for Mernda in the provision for taking over the interest of the State debts, because I think that,, with the developments which are likely to take place in the future, we should be unduly hampered. I think that we could carry out the scheme I propose without any difficulty. If therevenue largely increased in the future we could be liberal in distributing among the States the money that we were not bound to hand over, in the same way that we have been liberal in the past in distributing our surplus over and above the three-fourths of the Customs and Exciserevenue to which the States have been entitled.
– But the States refused to accept a lump sum for all time.
– As the time for the expiration of the Braddon! section approaches, the States must recognise that unless some special arrangementis made there will be no liability on thepart of the Commonwealth to do anything. I wish to secure to the States the liberal amount of £6,700,000 for the payment of the interest on their debts. We should absorb the great bulk of the interest on their debts1, and the whole of the loans would be taken over as they fell due. The Treasurer further suggests that the period during which the Government should undertake to guarantee an annual payment to the States should extend till 1920, and thereafter until Parliament otherwise provides. All the Treasurer really proposes is to continue thebookkeeping period, and to extend theBraddon section, with one variation, namely, that the Commonwealth should bein a position to ear-mark certain revenue, and devote it to any purpose desired’.
Then he suggests that if there be any surplus after that purpose is fulfilled, threefourths shall still go to the States The ear-marking of revenue should only be resorted to when no better proposal can be made. The system would be very complex, and might be attended with some extraordinary results. First of all, antagonistic interests might be created. Suppose, for instance, that a duty were imposed upon kerosene, and that the revenue derived from it- were ear-marked for the use of the Commonwealth. Suppose, further, that a proposal - such as has been acted uponin the United States, and which it ds said ‘has proved the greatest blow to the Standard Oil Trust - were made for freeing from duty all denatured alcohol used in the arts and manufactures, and for driving and propulsion. It would be manifestly against the interests of the Commonwealth, but it might admirably suit the States, if the duty were abolished. That is only one instance, and hundreds of a similar character might be quoted. We should not create rival and differential interests between the States and the Commonwealth dn regard to the revenue. Again, I would point out that if a certain duty were increased from 15 to 20 per cent., and the 5 per cent, additional duty were ear-marked for Commonwealth purposes, the. higher duty might bring in no more revenue than that realized by the lower impost. I should like to know whether the Treasurer would still annex one-fourth of the total amount raised.
– Then the right honorable gentleman would be compelled to pay less to the States.
– But the States would have a fixed sum.
– There would be constant disputes between the States and the Commonwealth in regard to such questions as I have indicated. The States might say that the Commonwealth had no right to deduct the extra 5 per cent, duty, because the increase of the duty had not resulted In an addition to the revenue. I would point out, further, with regard to the Treasurer’s proposal relating to the payments to be made to the States, that he might create a deficiency in the Commonwealth finances in one year, and be precluded from making dt good out of a surplus during the next year. If a State had a de ficiency one year, it could make it good out of the next year’s surplus, but the Commonwealth Treasurer could not do that, because he would still have to distribute the revenue amongst the States in the proportion set forth, and to add threefourths of all surplus over that. I am sorry that I have not been able to deal with the Treasurer’s proposals as fully as I should have liked. ‘I have, however, compiled a condensed statement of my suggestions, which is as follows: -
Looked at from the stand-point of the people of the Commonwealth being the owners of these properties, and the Governments merely trustees, it would seem only reasonable that when a service is taken over from a State, the properties necessary for conducting that service should pass, as would properties in an ordinary change of trust, without any claim’ for value by the first trustees. The States, however, urge with some reason that as there is a difference in the value fer cafiia of the properties passing with the services in the various States, it is necessary in equity to adjust that difference. Sir John Forrest’s scheme of writing off the lowest fer cafiia value of the transferred properties of any State from the values of every State, and settling on the balance, properly met that claim. But the States also point out that they have borrowed money for much -of the transferred property, and it is only right they should be relieved of the debt, not merely above the fer cafiia equality, but the debt covering the whole value, which debt should become one of the Commonwealth, and cease to be a liability of the States. The desire of the States might be met without reducing the return to them, or increasing taxation, or straining the finances of the Commonwealth’, by taking over debt, of the States, equal to the value of the properties, at the rate of ^1,000,000 per annum, and converting it, as State debts came due, into a special debt of the Commonwealth, till the full value of the transferred properties was covered. This would mean that as each sum of£1,000,000 was converted, the interest on it would come out of the share of the Commonwealth, not of the States, in the Customs and Excise revenue.
That all the debts be transferred to the Commonwealth as they fall due, unless prior to that a very favorable opportunity arise’ to convert. That responsibility for interest to the amount of£6,783,959 be undertaken at once, if it can be arranged, or on the expiry of the Braddon clause, by the Commonwealth, thus absorbing the amount proposed under a previous heading to be set aside for return to the States. This security having been given to the States, the Commonwealth to be unfettered in the management of its finances. With that end the Braddon clause to be suspended by agreement, or to lapse in 1910.
The responsibility for interest thus assumed would be on debt beyond that being gradually taken over in cover of transferred properties. In this connexion it has to be remembered that, although the net Customs and Excise revenue might increase, the Commonwealth would propose to find, in addition to interest on debt taken over for transferred properties, interest on further debt as converted, as well as to meet the deficiency on services yet to be transferred from the States, the expenditure on which largely exceeds the receipts; and would also require revenue for additional undertakings, such as the proposed old-age pensions, London representation, &c.
The Commonwealth to borrow for the States on Commonwealth stock, bearing 3 per cent, interest, and to have the right of borrowing outside or within Australia. The States to confine their borrowing, not effected through the Commonwealth, to Australia. The Commonwealth to provide a sinking fund of £ per cent, on all loans it issues, whether new loans or renewals. The States to provide a sinking fund of½ per cent, against money borrowed in Australia. Debt Commissioners to manage the loans and sinking funds. Commonwealth stock to have a fixed term, and be subsequently interminable, except by the Government, on notice.
A further safeguard against excessive borrowing and assurance to creditors would be an arrangement by which any State increasing its loan indebtedness _ beyond its fer cafiia rate at the establishment of the Commonwealth, should pay a sinking fund of 1 per cent, on the excess.
Generally, I agree with the other proposals in the Treasurer’s memorandum, except those to which objection is taken in the following : -
Clauses 9 and 10. - While the States may properly expect reasonable security for the payment from Customs and Excise revenue of interest on at least the bulk of their loans, the hampering provisions and complex effects of the Braddon clause, even as the Treasurer proposes to vary it, should not be continued for a day longer than necessary..
Clause 13 (1) The Treasurer proposes “to pay annually to each State for ten years after 31st December, 1910 (the date on which Section 87 (the Braddon clause) becomes alterable), a fixed sum equal to the average annual amount of three-fourths of the net revenue from Customs and Excise which that State has contributed during (say) the five years preceding such 31st December, 1910 (not including the special revenue in the case of Western Australia).”
This would mean that, did the present duties yield an increase of revenue before 1910, or special new taxation be necessary before then, not only would three-fourths of the proceeds for that period go to the States, but, irrespective of Commonwealth requirements, three-fourths of that increased revenue would be taken by the States for the following ten years.
Clause 13 (2) reads -
This would guarantee a further payment to the States, irrespective of Commonwealth requirements, should there be an increase of nonearmarked revenue, and practically extends the Braddon clause to 1920. The proposal is all against the Commonwealth, as a deficiency may have to be created one year to- pay the fixed amount to the States, and the surplus of the next year cannot be taken to make it good.
Clause 13 (3) reads -
“Provided that after 31st December, 1910, the Commonwealth may impose additional Customs and Excise duties for specific purposes, and may specially appropriate and retain and ‘ ear-mark ‘ the whole of the revenue -
If any surplus remains in any year after providing for such specific purposes from the revenue derived from such special appropriations, threefourths of such surplus to be annually returned to the States fer cafiia.
These arrangements to continue for ten years, viz., after the 31st December, 1910, up to 31st December, 1920, and thereafter until the Parliament otherwise provides.”
This is the only real modification of the Braddon clause, and does not operate until after ig’io, at which time the Commonwealth will be free to make this or any other provision. It is objectionable, because it divides the Customs and Excise duties into two classes, the one benefiting the Commonwealth, the other the States, and it thus, to some extent, creates rival interests. In providing, if a special duty is an increase of an existing one, for proportional divisions, it may raise endless complexities.
The whole of clause 13 simply postpones the adoption of a system possessing any elements of permanency for 14 years, to a time when the circumstances may be more unfavorable for reasonable adjustment than they are to-day. It refuses to approach nearer to what must be the financial goal, and, while conferring no benefit sufficient to justify it on the States, it continues to hamper the Federation. Only if a better and more federal system is shown to be impossible now, or proved to be far more readily realizable in the future, should there be postponement. The Treasurer declares as one reason for delay that the people do not yet think federally. It is hard for them to do so, when, instead of their interests being merged in those of Australia, State distinctions are allowed, without good reason, to remain, although it was intended they should disappear in union.
Turning briefly to one other matter, as there is not time to deal with others as I intended, I cannot agree with the proposal for the introduction of universal penny postage. Personally, I am very strongly in favour of the system, but, having regard to the finances of the States which have most severely felt the strain of Federation, I cannot see my way to support the present proposal. It would be very desirable if we could introduce penny postage into New South Wales, where the present system is rather mixed.
– I do not think that we should be justified in doing so in our present financial position.
– Why should the people in the cities have the advantage of cheap postage, while those in the country are denied a similar benefit?
– Because that is the law, and we cannot afford to alter it. The Treasurer admits that the introduction of penny postage would involve a loss of £200,000, and, at the same time, he is proposing to increase the expenditure of the Commonwealth to the extent of £535,000. He would thus make a very big hole in our one-fourth of the Customs revenue, and leave very little available for other purposes. It must be remembered that we shall have to provide for a number of non-revenue producing Departments, which have still to be taken over from the States. We must not attempt too much whilst we are hampered by the financial provisions of the Constitution. The introduction of the penny postage system, after all, would not confer such a very great benefit upon the masses of the people, and we should not bring about such a reform until we are satisfied that the States whose finances have been most strained can bear it. Further than that, it is preferable that we should first deal with matters of greater urgency. I refer more particularly to the approaching termination of the bookkeeping period. Surely, after five years, we ought to be able to devise some scheme for supplanting the present bookkeeping system. The figures I have given - and I can vouch for them, because I had them checked by the Treasury officials - show that at this moment, if we adopted a per capita method, there would be no more difference in the result than would be likely to be brought about at a later stage. I ask honorable members when we shall ever reach a stage at which there would be less disruption by abandoning the bookkeeping distinction as to Customs and Excise between State and State. Any additional burden would be thrown almost entirely, for the time being, upon New South Wales, .and I have already stated why I believe that State could bear the burden, and why the present opportunity is a favorable one. Her finances are flourishing, and she has a large surplus, and she will subsequently reap advantages which will repay her for any present loss. The Treasurer complains that the people have not yet learned to think federally. How can they be expected to do so when their leaders, instead of bringing thiem into closer union, and instead of attempting to distribute the taxation of the State upon a per capita basis, leave them as they are. With regard to the entries for Inter-State goods, we seem to be more separated than we were before the Union. The time has come when we should face the situation. It is more urgent that . we should consider the bookkeeping provisions of the Constitution than that we should discuss the Braddon section, or the transfer of the State debts. Unless the bookkeeping provisions are extended they will cease to operate in October next, and we ought to apply ourselves to the consideration of some method of distributing the revenue which will not be seriously injurious to any State, but which will benefit those States whose revenue has been most affected besides Western Australia, namely, Queensland and Tasmania. If there is any good in Federation at all, and if it is desired to equalize the burdens of the States, we should act in that direction now, when we can effect the change with perhaps less loss or disturbance than at any other time.
– Does not the honorable member think that the Braddon and bookkeeping sections should be discussed at the same time?
– It is highly desirable that that should be done. That is why I have discussed the two matters together.
– Both matters can be discussed, but both cannot be legislated upon.
– We could deal with any restrictions imposed by the bookkeeping provisions-
– We could do that in the case of Queensland, owing to the increasing amount which that State ‘has to pay year by year.
– I say that the finances of States like Queensland and Tasmania have been hard hit by Federation. I am aware that it is often said - and with some degree of truth - that when the people of any State do not contribute to the revenue as much as they would do under other circumstances, the money is in their pockets. But in the case of Queensland and Tasmania that is not so to the full extent, because their revenues have been reduced by goods from the other States upon which they have had to pay the higher rates imposed under our protective Tariff, although they will not - when the bookkeeping period has expired - be credited with those duties. In addition, we must recollect that they lose by non-recording under the bookkeeping conditions. I do hope that the Treasurer will not think that I have put forward these proposals from any party motive. The only State which would be injured by them - with the exception of Western Australia, which would be injured to a slight degree - is New South Wales, and that only temporarily. I feel sure that if he will give careful consideration to the matter he will conclude that when the bookkeeping provisions have expired they should not’ be renewed, but that some arrangement should be made under which we can approach nearer to the intention of Federation.
– I move -
That the House at its rising adjourn till 3.30 p.m. on Tuesday.
The visit to Mahkoolma, and other suggested sites for the Federal Capital, is taking from our midst to-day a number of honorable members who . will not return, at the earliest, until 1.45 p.m. on our next day of sitting. Under the circumstances, I think that we might postpone our meeting till a later hour than usual.
Question - resolved in the affirmative.
– In -moving -
That the House do now adjourn,
I wish to intimate to honorable members that our first business upon, Tuesday next will be the consideration of the proposals of the Tariff Commission in reference to spirits, wine, and industrial alcohol. Upon these items the propositions of the Government have already been formally submitted to the House. Owing to the extraordinary circumstances under which we find ourselves at this stage of the ses sion, discussing Tariff proposals which, were not presented till after the delivery of the Budget, it was not possible to include in our estimates any forecast of the probable effect of these proposals upon the revenue. As honorable members are aware, the opinion of experts is that the duties upon spirits, as they have been amended by us, will, if agreed to, involve no change in the revenue,- and affect no alteration in the Treasurer’s forecasts. But I hope honorable members will clearly understand that the action which has been taken to-day affecting the duties on agricultural implements, was forced upon the Government before members of it - with the exception of the Minister of Trade and Customs and myself - had even read the recommendiations of the Commission in reference to the items with which they deal. The proposals are simply the recommendations of that body, and not purs. Whether we shall increase any of the duties proposed, or decrease others, I cannot say. As I have already remarked, the whole position is extraordinary. The information which honorable members still lack of the intentions of the Government and of the results which will flow from giving effect to our alterations of the Tariff,. either by way of increase or decrease in the proposed duties, will be made known at the earliest moment. I think that honorable members will be able to obtain proof copies of the reports of the Commission, which have been laid upon the table of the House this afternoon, before they leave for their respective States, and am hopeful that thev will also be supplied with copies of the bulky report, six or seven inches, containing; the evidence relied upon to support the recommendations of that body.
Question resolved in the affirmative;
House adjourned at 4.7 p.m.
Cite as: Australia, House of Representatives, Debates, 10 August 1906, viewed 22 October 2017, <http://historichansard.net/hofreps/1906/19060810_reps_2_33/>.