6th Parliament · 1st Session
Mr. Speaker took the chair at 10.30 a.m., and read prayers.
.- With the permission of the House, I wish to make a brief statement regarding the Commonwealth trawler Endeavour, which is now. eight or nine days overdue at Hobart from Macquarie Island. Thenews is serious, but I shall give the exact facts as we know them, so that there may not be unnecessary alarm. The Endeavour went to Macquarie Island on behalf of the Meteorological Department to relieve part of the Mawson Expedition which had been left there, taking down a new wireless operator and bringing back the operator who had been there some time. She took five days to go from Hobart to Macquarie Island, and she should have been back at Hobart on the 8th. The following wireless message was received at 1.30 this morning at the Weather Bureau from Macquarie Island - “ Endeavour left Thursday, 3rd instant. Calm sea. Actual departure unobserved owing fog. Understand making Hobart direct. Had 90 tons coal on arrival here 30th ultimo. Cannot say what provisions Mr.Dannevig had. Hoped reach Hobart underfive days. Weather since rough. Saturday, 5th, gales and tremendous seas.”
I immediately consulted with the Prime Minister, and the Controller-General communicated with the head of the Naval Department, Admiral Cresswell. We are trying to arrange for the sending of one of the warships, which is now in Queensland waters, and, being fitted with wireless, is better suited than another boat for the making of a search.
– Is the Endeavour equipped with wireless?
– No; though the question of equipping her has been under the consideration of more than one Government. Were she equipped with wireless, we should probably know whereshe is now. Captain Bolger, who was in charge of the Lady Loch for a number of years, has informed me that that vessel cannot carry sufficient coal to enable her to undertake the necessary search. Had it been otherwise, the Lady Loch would probably have been sent yesterday, with the consent of the Victorian Government. In the opinion of Captain Bolger, the Endeavour is a well found vessel, and there is little reason to fear that she has been lost. She may have met with an accident, such as the breaking of her shaft, which has happened more than once to the best of vessels, or she may be short of coal.
– She may have had to run before the gale.
– She has before now ridden out gales under a sea anchor, and Captain Pym, her master, is an old master of sailing ships, as to whose ability I have no doubt. We are getting into touch with the Navy, and if the services of the warship cannot be obtained, we shall probably be able to get another vessel, fitted with wireless, which is now in Sydney Harbor. Every step will be taken to allay the anxiety of those who have relatives on board the Endeavour.
– Has she any sail?
– I think that she has a stay sail and a couple of try sails.
– Yesterday the
Prime Minister was good enough to lay on the table some reports of the Foodstuffs Commission, whose labours were recently terminated. There is a mass of information in them which I think is very valuable. Has the Prime Minister any objection to moving that the documents be printed?
– None whatever. I move -
That the paper - Reports and Recommendations of the Royal Commission on Food Supplies and Trade and Industry during the war - laid on the table yesterday be printed.
– Is the correspondence which passed between the Commission and the Prime Minister among the papers?
– I think so.
– There is nothing there giving the reasons for the discontinuance of the Commission.
– That communication, I think, went from the Minister of External Affairs.
– It should have gone direct from the Prime Minister to the members of the Commission. Can the Prime Minister say why so useful a Commission was terminated? The State Commissions are still in existence, and the Commonwealth Commission was dealing with matters which the right honorable member admitted yesterday were of supreme importance.
– Speaking from memory, at the first or second interview that I had by their request with the members of the Commission, they stated that they considered that their work had been largely superseded by the action of the Government in prohibiting the export of wheat, sugar - it is to be remembered that I represent a sugar-producing district - flour, and other things. I think that the Commission indicated to me, in the most polite language - it was a long time before I discovered it - that unless they were permitted to deal with these questions in their own way and make reports, their usefulness had gone.
– I should think so.
– I conveyed to them with the greatest respect that a situation of that kind could only be dealt with by the Executive, if it was to be of any use. But there was no feeling between the Commissioners and ourselves in this matter, and there is none now, I am sure.
– I see - they took the sack with good grace.
– Yes, ifthat is the opinion of the honorable member.
– Can the Minister of Trade and Customs tell the House what is the position at the present time in regard to the export of meat ?
– There is no restriction so far as Great Britain is concerned, but with regard to other countries an application has to be made no matter in what form the meat is to be exported.
– Have any applications been refused?
– Yes. I think that exportation to a certain portion of South Africa has been allowed.
– I riseto make a personal explanation. The Age of this morning contains a paragraph which refers to a debate in this Chamber last night, and in which this statement appears -
At one stage the Leader of the Opposition had to enter a protest against the “ cheap jesting “ that was, being indulged in. The leaders of the House, notably Mr. Fisher, Mr. Conk, and Sir William Irvine, kept the discussion at a high level, but it remained for Mr. Boyd to suggest - the suggestion was greeted with much laughter - that the men of Australia would be inclined to regard the widow’s pension as “ beer money,” and make a rush for it.
In view of a statement of that kind appearing in the Age I think it wise, with your permission, sir, to read exactly what I did say, and thus show the deliberate, wilful misrepresentation of that journal with regard to myself. Ever since I asked the question in the House, which brought out the German nationality of the editor of that newspaper, it has refused to print a solitary word or line that I have uttered here.
– You are not the only one who has been treated in that way.
– I may not be, but I am referring now to myself. I do not object to that. But you, sir, told the House last week, in a statement with regard to the conduct of some members of the press, that the editor of the Age said that any unfair report by a member of the staff would be dealt with by the editor himself.I pointed out, by way of interjection on that occasion, that that was left for the editor to do. Let me now quote what I actually said last night -
The object of the Bill is to insure the livelihood of soldiers’ widows who have lost their breadwinners. When other breadwinners come along to provide for them, are they to receive in addition compensation for the loss of the first breadwinners?
– It may turn out that the second husband cannot provide for the widow.
– It is men of that sort who would marry these widows.
– The interjection of the Leader of the Opposition suggests that it is the deadbeats and hangers-on who would be after the widows.
– Is not that a slur on the widows?
– No. The case is one that we meet in life only too often. Those of us who have had to do with pensions know how some persons hang on to one another, and know, too, the scheming that takes place. Women entitled to a pension of 9:52 a year for life would easily find men to marry them. The pension would at least give their husbands beer money. The clause as it stands is a protection to the widows.
Those are the words which I used, and those words refer clearly to, and were mentioned in my speech as the outcome of, the interjection by the Leader of the Opposition, that widows could easily find men to marry who could not support them ; in other words, that they would be merely hangers-on and dead-beats. It was not meant to refer, nor can any honest critic of the speech of a member of Parliament say that it referred, to the men of Australia. I do not expect fair play from the Age. It has never reported a solitary line of mine, and good luck to it, because it cannot do me any harm. It has done its best and failed, but I certainly object to being deliberately and wilfully misrepresented by a journal whose reputation for truth stands at about the bottom of the press of Australia.
– Is it not up to the Leader of the Oppositon to apologize to the honorable member for Henty for having so adroitly led that innocent gentleman astray last evening as alleged in the report in the Age?
– Order !
– Webster’s humour unrevised .
– Is the Prime Minister able to give the information I asked for yesterday as to the incidence of the graduated land tax on the higher valuations of properties? He promised to supply it to-day.
– I have not the information at the present time, but I will get it in a few minutes, and give it to the honorable member.
Special Allowance to Wives
– Is the Assistant Minister of Defence in a position. to reply to the question I asked a few days ago relating to a special allowance to the wives of men on service ?
– I have been furnished with the following information : -
Privates of the Australian Imperial Force are paid 5s. per diem while in Australia. On embarkation the pay is raised to 6s. per day., but1s. per diem of this is “ deferred,” that is, it is not payable until the soldier’s period of service is terminated by death or discharge.
Members of the Australian Imperial Force receiving less than 8s. per day are paid separation allowance as under for each day in camp prior to embarkation: -
For wife (living at home),1s. 3d- per diem.
For each child,7½d. per diem.
A similar allowance as in (a) shall he paid to members who are the sole support of a widowed mother. The allowance under (b) shall be limited to each child under fourteen years of age who is dependent upon its father for support.
The payment of a separation allowance to members of the Australian Imperial Force was authorized in the first place in order that these men should be placed on the same footing while in camp prior to embarkation, as. members of the Citizen Forces called up for service in connexion with local defence, to whom a similar separation allowance is payable under regulations.
In connexion with this question it may bo pointed out that service in the Australian Imperial Force is voluntary, and that it is clearly brought under the notice of men on the attestation form which they sign on enlistment that separation allowance will not he paid after embarkation. The question of payment of separation allowance after embarkation was carefully reviewed quite recently, and it was decided that no alteration in the existing practice could be made.
Military Raids: Australian Ores: Contracts with German Firms.
– Can the AttorneyGeneral say whether the statement he made last week in relation to the base metal trade of Australiawas based upon information obtained during the recent raids in the State capitals, or whether some portion of it was obtained from private sources; and, if so, will he name the sources?
– I do not know that I ought to disclose the sources of information to which the Crown has had access in this connexion. I know of no reason, however, in this particular case why this should not be done. Categorically the answer to the honorable gentleman’s question is that the information on which the action was taken in those cases in which action was taken, and on which the statement, in connexion with the metal industry generally, I read in the House the other day was based, was derived wholly from papers that were obtained as a result of the search. But assistance and expert advice was obtained in order that we might more fully avail ourselves of such information. This was mostly supplied by Mr. J. M. Higgins. who was requested, and, in fact, compelled, by us to do so. He was asked by me whether he would advise the Government, but, he declined to do so unless under compulsion. I then told him that, acting under the powers given by the Act, I must ask him to assist the Crown to the full extent of his ability. The result is before the House.
– Is it a fact that during this week certain raids have taken place in Adelaide on the premises of firms interested in the metal trade? If so, what is the reason for observing secrecy?
– Unless the honorable member furnishes me with the particulars of the raids to which he alludes I am unable to answer his question. I know of no raids that have taken place in Adelaide this week, but I shall have inquiries made immediately and I shall furnish the honorable member with the result at the earliest possible moment.
– Has the Attorney-General any information with reference to the following cablegram printed in this morning’s newspapers ? -
Messrs. Harland and Company, steam-ship brokers, in a letter to the Morning Post, state: - “It is understood that a group of financiers has fully considered the question of laying down a plant for the reduction of Australian ores, but it is impossible to proceed if the German group is able to claim damages after the war for the non-delivery of ore. The Government should pass a short Bill limiting the liability of Australian mining companies for deliveries to date from the declaration of war.”
– I have read the paragraph referred to. The reference is to British legislation, but action by the British Legislature alone would be insufficient for the purpose spoken of by the honorable member, as probably the greater part of the contracts have been made in Australia. Action would need to be taken in Australia in regard to such contracts. As I set forth in a statement I made to the House the other day, we have suggested to the British Government that this action should be taken, and it is the intention of the Government to introduce the necessary legislation here in order to co-operate with the British Government in the matter.
– Has the Minister of Home Affairs made the inquiries which he promised to have made yesterday in regard to making available for purchase in the various capital cities the Year- Book and publications of the Commonwealth Statist?
– The following are the booksellers where copies of the Y ear-Book can be obtained: -
Sydney. - McCarron, Stewart, and Company, Goulburn-street.
Melbourne. - McCarron, Bird, and Company, Collins-street: George Robertson, Elizabethstreet; Melville and Mullen, Collins-street; E. W. Cole, Bourke and Collins streets; Whitcomb and Tombs; Sands and McDougall, Collinsstreet.
Brisbane. - Gordon and Gotch, Brisbane.
Adelaide. - E. S. Wigg and Company, Limited.
Perth. - E. S. Wigg and Company Limited.
Hobart. - J. Walch and Sons, Limited.
Launceston. - James Birchall and Sons.
I do not think that the other pamphlets and periodicals issued by Mr. Knibbs are stocked at all these places, but any person requiring a particular publication may get it by ordering it from his bookseller, just as he can order any other book that is published.
– Will the Minister make arrangements to have the various pamphlets available for sale in the capital cities?
– It has been reported to me that there is very little demand for these publications, and unless there is a demand little good will be obtained by these booksellers stocking them. Any person requiring a publication can get it by ordering it through his bookseller.
Reported Naval Engagement
– Has the Prime Min ister any further information in regard to the Naval engagement reported in this morning’s newspapers to have taken place in the North Sea?
– We have received no official confirmation of the news already posted .
– Is it true, as stated by the officer in charge of the Department of Home Affairs, that there are over 1,000 names on the Melbourne list for employment, and that the registration of any further names is of no use?
– Yes, I believe that there are over 1,000 names registered, but I question whether in proportion to the population the number is greater than the registrations of unemployed in Adelaide and Perth.
– Now that the Houses are going into recess, will the Prime Minister, in view of the amount of unemployment existing and prospective, afford honorable members some information through the different Departments as to the public works - apart altogether from the Estimates, where works which may, or may not, be commenced are mentioned - which will be going on, and in respect of which more men are likely to be required ?
– Yes. The Departments have already been instructed to furnish a list of all works to enable honorable members to know whether they are going on. A great number are proceeding all over Australia, and a very large sum of money is provided for them. The Government propose to submit a motion withdrawing those works from the operations of the Public Works Committee, so that they may be proceeded with at once, without delay.
– A large number of works have been authorized in the Postal Department, but it is impossible to get the officials to go on with them. In view of the large number of unemployed, will the Postmaster-General see if it is possible to expedite them?
– I do not know what authority the honorable member has for making the assertion, and am unaware of any delay. So far as I know, thework is going on as quickly as it can be got ready.
– Has the Postmaster-
General framed the regulation whereby letters for the Expeditionary Forces now serving under the Imperial Government are to be franked ? If not, when can we expect to have this done ?
– The regulation will be framed as soon as we get, by cable, the official answer from Great Britain. I expect that the matter will be arranged immediately.
– In the event of the Inter-State Commission not being in a position to deal with the matter of inquiring into the possible establishment of new industries or trades in Australia, will the Prime Minister consider the advisability of appointing an outside Commission of business men or others fitted to make the necessary inquiries?
– You have just turned away, in a scurvy way, an outside Commission which was inquiring.
– The assertion of the Leader of the Opposition is one of those inaccurate statements that are made for political purposes. Remarks of that nature for political purposes have no effect on me. The honorable member for Oxley has raised an important matter. To have a competent and capable body of men engaged in the thick of business to deal with this question would be of great advantage.
– Is the Prime Minister aware that at the time of the resignation of the Commission to which I referred they were actually engaged on the undertaking suggested by the honorable member for Oxley? Has the Prime Minister read the reports already made by the Commission on these matters?
– I am not aware that the Commission was so engaged. With the greatest respect to the gentlemen referred to, I do not think they are the proper body to deal with that question.
– Arising out of the question raised by the honorable member for Oxley, has the Minister of Trade and Customs any reasonable expectation of the new Tariff stimulating existing industries, and even leading to the establishment of new ones, in view of the general policy of the Government of putting disabilities and difficulties in the way of those engaged in our industries?
– Order !
– I do not think there is anything to answer in the question.
Reduction of Garrisons
– In view of the statement made by the Minister representing the Minister of Defence, that since the capture of the Emden he was relaxing to some extent the guard upon our coast, does he not now consider, in view of what has happened on the shores of Great Britain, that it is necessary to reestablish, and even to increase, the watchfulness of the Department upon our coastline?
– No, we do not consider it necessary. The Indian and Pacific Oceans are practically clear of enemy ships, and that is the consideration which guides the Minister and the Department.
Applicants for Employment
– Has the attention of the Minister of Home Affairs been called to a statement appearing in a late issue of The Worker, to the effect that men who were engaged on the Port Augusta to Kalgoorlie railway have been “ sacked “ and their places taken by others ? If that is the case, will he take precautions to see that all men have an equal chance of getting work?
– The statement referred to by the honorable member is absolutely false. Every one that applies will get an opportunity of employment - if there is work for them. If 100 men are wanted, and 2,000 apply, I do not promise to employ them all.
– Has the attention of the Minister of Home Affairs been drawn to a letter appearing in this morning’s press over the nom de plume of “Australia first” in which the statement appears than an order was placed by the Australian Government with an “American firm for the supply of 25,000,000 feet of lumber to be used in connexion with works at the site of the Federal Capital?
– I have not seen the letter, but the honorable member called my attention to its appearance. There is absolutely no truth in the statement, so far as the Commonwealth Government is concerned, but I can under stand the mistake that has occurred. A Canadian ex -Minister and some gentlemen connected with America asked me whether there was any chance of placing an order for lumber in Canada and America. I said the Department had no intention of doing this, but that if anything of the sort occurred they would not be forgotten.
– Can the Minister of Home Affairs state why the proposed railway from the Federal Capital to jervis Bay does not appear as one of the works to be referred to the Public Works Committee for consideration ?
– We consider that the two works to which the attention of honorable members has already been drawn are sufficient.
– In view of the Minister’s statement, is it the intention of the Government to proceed with any other works involving an expenditure of over £25,000 next year, because, otherwise, the works cannot be proceeded with ?
– There may be other works to which the attention of Parliament will be called, but I cannot say whether they will involve the expenditure of the amount of money which would require them to be inquired into by the Public Works Committee under the terms of their Act.
– Will the Minister of Home Affairs state what stage has been reached in the building of the railway between Yass and Canberra ? Does he intend or not to refer the work to the Public Works Committee?
– Not on the present occasion. I do not see the necessity.
– Has the PostmasterGeneral made, or does he intend to make, any special effort, and, if so, what, to expedite the construction of country telephones which are in many cases eighteen months in arrear, and in some districts more than that? The work could well be pushed on with now in view of the fact that there is no scarcity of labour and of the pressing demand for these conveniences.
– All the work possible is being pushed on. There is not in the
Postal Department, any more than in any other Department, an unlimited supply of cash. The works approved on the Estimates are being gone on with, including as many country telephone lines as possible.
– Whathas become of the flag captured in German New Guinea and recently displayed in the Queen’s Hall, and why has it been removed ?
– I cannot give the honorable member the information, but will inquire and let the honorable member know privately.
asked the Minister of External Affairs, uponnotice -
– The answers to the honorable member’s questions are as follow : -
2 and 3. Up to 31st October, 1914, the sum of £53,446 had been expended, which will indicate the progress that has been made. Building operations were suspended for several months on account of industrial strikes.
asked the Minister of Trade and Customs, upon notice -
– The New South Wales Government will be asked to supply the information as soon as possible.
Motion (by Mr. Fisher) agreed to -
That leave be given to bring in a Bill for an Act to amend section 15 of the Commonwealth Public Works Committee Act 1913.
Bill presented by Mr. Fisher, and read a first time.
Motion (by Mr. Fisher) agreed to -
That leave be given to bring in a Bill for an
Act to amend section 6 of the Australian Notes Act1910-11.
Bill presented by Mr. Fisher, and read a first time.
Motion (by Mr. Fisher) proposed -
That the following works be referred to the Parliamentary Standing Committee on Public Works, in accordance with provisions of Commonwealth Public Works Committee Act 1913, viz. : -
Flinders Naval Base - Works under the control of Department of Home Affairs, including supply of water; erection of necessary buildings; sewerage, &c.
Federal Capital Territory - Proposed storage and regulating reservoir, Upper Queanbeyan River.
– In my judgment, this motion does not comply with the terms of the Public Works Committee Act. There are no plans, no specifications, no estimates, and no reports. There is nothing but the simple motion that the Committee should inquire into these proposals.
– I think the Minister has some information.
– Honorable members are aware that for some time past Parliament has had under its notice the construction of the Flinders Naval Base. A site has been agreed upon, and work has been done in connexion with the Base. In fact, in looking at this year’s Estimates, honorable members will see that moneys have been voted for the current year, and works are in progress. There is not a great deal being done at the present moment, but after the holidays a number of men will be employed. What the motion proposes is that the Public Works Commiteee shall be asked to inquire into works that will be required later on covering all parts of the scheme. Those works comprise the building of barracks, officers’ quarters, training school, workshops, wireless telegraph station, administrative offices, &c. There is one matter of particular importance into which the Committee should inquire. When this Base is completed there will be a great number of men employed there, and a fairly large community will be in residence. It will be, in fact, a veritable beehive of industry, and it is essential that we should pay early attention to the water supply and drainage. Long before the work is completed we must have an adequate water supply provided for the workmen who will be engaged, and that is one of the matters which we desire the Committee to investigate.
– How will this motion affect that?
– Part of the work is in progress now, and there is a finished scheme in the Department which represents the consummation to be reached. It is essential that the House and the country should know what that scheme is. As we shall be having a large body of people together at the Base, we must know at once how they are to get their water supply. This has been a matter of some anxiety to me, because I did not care about going too far ahead until 1. had some definite scheme. There are three alternative schemes for a water supply under consideration. One is to convey the water by pipe from the Metropolitan Board of Works’ service reservoir at Oakleigh Hill, a distance of 42 miles. I frankly admit that I am not in a position to go into this question as thoroughly as I would like to do. This proposal represents work for practically a year ahead, and, owing to pressure of parliamentary work, there has been no opportunity for me to thoroughly inquire into the subject. The information I am giving may be considered somewhat meagre, but it is possible that that objection will apply generally to works which are submitted to the Public Works Committee. The Committee will be able to secure full information upon them. I do not say that the Government have no policy on this matter, but there are three questions to be considered in connexion with the water supply, and they have not been finally settled from the departmental point of view. This is eminently a work which the Public Works Committee should take into consideration. There is what might be considered a second theory in regard to the water supply. An examination is being made of the ranges to the south of the depot with a view to the acquisition of an area, the construction of storage works, and necessary mains. An analysis of the water to be discharged from the water-sheds is to be made. The results of the analyses have, so far, not been satisfactory. I should not like honorable members to infer from that statement that the inquiry has been of an exhaustive character. In the case of works referred to the Public Works Committee, I do not think the House will expect exhaustive information from the Home Affairs Department. They will be merely works in contemplation, and an exhaustive inquiry in connexion with them will possibly not have been made. It may be said that they will be works in connexion with which we are feeling our way. It would not be right to go full steam ahead with a proposal involving considerable expenditure unless we were assured that we would not be wasting money. I do not know that the Department would be prepared at the present time to recommend either one or the other of these schemes. The third is a very important one. A conference of the shires of the Mornington Peninsula has been held, and a proposition is to be placed before the “Victorian State Rivers and Water Supply Commission to obtain a supply from the Dandenong Ranges for the whole peninsula, including the Flinders Naval Base. The report of the conference will, it is expected, be presented early in the new year. It will be for the Public Works Committee to consider whether it would not be advisable for the Commonwealth to assist in giving effect to the Victorian proposal to supply the whole of the Mornington peninsula, including the Naval Base, on a general principle of rating such as is applied in the case of city water supplies. These are the only proposals which the Department is in a position at the present time to put before the Public Works Committee. We shall be spending a very considerable amount of money in connexion with the Flinders Naval Base. Apart from what has been voted already for this purpose, very considerable further sums will be required before the works, buildings, water supply, and necessary drainage are completed. It is impossible at present to estimate the number of men who must be employed, but it is clear that when the Naval Base is in full working order there will not only be a big working population at the place, but a considerable ‘trading population also. The next work proposed to be submitted to the Public Works Committee is the work at the Federal Capital site for the construction of a regulation and storage weir on the Queanbeyan River. The Molonglo River, which flows directly through the city site, receives the discharge from a drainage area of approximately 700 square miles, and is composed of the River Molonglo and the Queanbeyan River. The junction is at the town of Queanbeyan, at a point about 6 miles above the city site. The drainage area is steep mountain country, much denuded of natural timbers. As a consequence, there are sudden floods iu the river, and periods of minimum flow during very dry weather. To store the flood waters and have them available for dry periods, it is proposed to construct on tlie Queanbeyan River, at a point known as Studdey’s, some 6 miles up the stream from the town of Queanbeyan, a storage and regulating reservoir. The site suggested combines an economical section for the construction of a dam of 100 feet high with a storage basin of a little over 1 square mile and a capacity of 1,000,000,000 cubic feet. I need not say very much upon this work. Honorable members are very properly anxious to know what is going on at the Federal Capital site. From the plans of the city which have been before them, they will have noticed that certain lakes are provided for, and those lakes will have to be supplied from the water which will be stored by the construction of this work. The Public Works Committee should have an ample opportunity to look into this question. This will certainly be the next work in connexion with the Federal Capital which the Home Affairs Department will have to undertake.
– Has the Minister succeeded in inducing the Government of New South Wales to deal with the drainage question on Queanbeyan ?
– I know that negotiations are in progress with the State Government on the subject, but they are not yet complete. The works which we propose to submit by this motion to the Public Works Committee will give the Committee plenty to do until Parliament meets again.
– Is it proposed to refer no other work to the Committee this session.
-No other works will be referred to the Committee until the House meets again after the special adjournment.
, - I do not propose to delay the consideration of the motion, but wish to point out that the Minister has a very roughandready way of complying with the terms of the Act. If honorable members will turn to section 15 of the Act, they will find that it is provided that no public work of any kind whatsoever, the estimated cost of completing which exceeds £25,000, is to be commenced unless the sanction provided for under the Act has been obtained. It is further provided that every such work shall, in the first place, be submitted and explained in the House of Representatives by the Minister of State for Home Affairs. The explanation is to include an estimate of the cost of the work when completed. We have had from the Minister no estimate whatever of the cost of the proposed works at the head of the Molonglo River.
– They are stated to cost £100,000, and the estimate of cost for other work referred to is £55,000.
– These are nice round figures! In addition to the estimated cost there must be “ such plans and specifications or other descriptions of the work as the Minister deems proper.” What the Minister deems proper, I take it, is additional to the plans and specifications, which must be produced, together with the prescribed reports on the probable cost of construction and maintenance. We have had no report as to the cost of this work. We have had nothing more than a vague estimate dealing in round tens of thousands.
– That was a report.
– If the Minister said “ We are going to build so many miles of railway at a cost of £1,000,000 or £2,000,000 “ that, according to the Prime Minister, would be a report complying with the provisions of this Act. I think that the right honorable gentleman will recognise that this is the lightest and most extraordinary way possible of carrying out these provisions.
– If we had. to do what the honorable member suggests, there would be no work at present for the Public Works Committee. We should have the plans and everything else ready.
– Then the departmental officers do not prepare their estimates of cost in the first instance - they want the Committee to do the work for them ?
– After the officers have done the work, the honorable member says that the Public Works Committee should come along and turn everything upside down.
– That is what the Minister’s officers do not want.
Mir. Archibald. - It is not what they do not want, but what I do not want. I do not want a waste of public money.
– Yet the Act says that the officers of the Department shall produce their plans, specifications, and estimates for the consideration of the Committee.
– That is the very purpose of the Committee - to check what the officers are doing.
– Exactly. The Minister says, in effect, that the plans of any work having been completed it would be a waste of money to have them gone over again by the Committee.
– I say that it would be a waste of money to go over the whole thing again after the work in question had been completed. Why kick up a row after the work is done ?
– I have not suggested anything of the kind. My honorable friend must recognise that, whatever his officers may advise him to do, and however much they may dislike this Act of Parliament, they have to work under it.
– It is not for them to like or dislike any Act of Parliament.
– But, obviously, they dislike this Act of Parliament, and are not going to have any works submitted to the Committee.
– There is the other alternative - if they do not like it, they can get out.
– Heaven forbid! The Act also provides for the submission of estimates of probable revenue, if any, to be derived from any proposed work.
– What revenue would be obtained from a Naval Base?
– There might be some grazing revenue.
– It is quite conceivable that there will be some revenue. We have here, for instance, a water scheme which is to provide for the whole district. The Minister should be able to give a very satisfactory reason for some of these activities that he has in contemplation in the neighbourhood of Westernport. I am merely pointing out to the House that the actual terms of the Act have been scouted by the responsible authorities for the reason, I firmly believe, that they are not liked by the officers, who should have prepared their plans and specifications before the Committee was asked to consider these proposals. That, I believe, is at the bottom of the whole thing, and the Minister, with Christmas-like complacency, has given way to their desires.
– The honorable member is quite wrong.
– I think that whilst we are dealing with the waters at the head of the Molonglo we might very well refer to the Public Works Committee the whole water scheme for the Federal Capital.
– There is no objection to that. The Government desire that this Committee shall be given a wider scope to begin with, so that they may, so to speak, have a look all round.
– The most serious matters to inquire into, so far as the Federal Capital is concerned, are those of water supply and sewerage.
– We are asking the Committee to deal with a water scheme for the Naval Base.
– That is a trivial work compared with those to which I have referred. Will the Prime Minister include the water supply and sewerage for the Capital in the reference to the Committee ?
– Yes; if it is agreeable to the Opposition.
– Very well. I shall say no more.
.- I would point out to the Minister that we necessarily exempted from inquiry by the Public Works Committee all works on this year’s Estimates. Unless in the interim his officers prepare plans aud specifications of works to be referred to the Committee as soon as we meet again, so that they can be inquired into, we shall find ourselves in exactly the same position that we occupy to-day. The Department of Home Affairs has been most lax. This Act has been on the statute-book for twelve months, and in view of its passing the Home Affairs Department should certainly have had a number of works ready for reference.
– We have not. been in office all that time.
– I do not say that the Minister, but that the Department, has been lax. The officers do not want these inquiries.
-They will have to submit to them.
– Exactly. I hope that the Minister will see that in the interim his officers get a number of works ready for reference to the Committee. The plans for the Federal Capital railways, for instance, should be ready now, and we cannot push on with their construction until they have been submitted and reported upon by the Committee. I hope that the Minister will stir things up in his Department.
– While the Minister is considering the suggestion made by the honorable member who has just resumed his seat, I hope that he will also see that the regulations for which the Act provides are drafted. Section 15 prescribes certain things which can be done only by regulation, namely, not only the preparation of plans and estimates, which in the ordinary course, will be found necessary to secure a primary reference to the Committee, but reports in relation to certain public works as they are proposed. Those reports have to be prescribed, and that can be done only by regulation. So far as I am aware no regulations have been drawn under this Act. I hope that the Minister, in hustling his Department to get ready during the adjournment the necessary data for further references, will also have drawn up the regulations which will more fully prescribe the material of parliamentary wants.
– My recollection is that in New South Wales,, in connexion with every work submitted to the Works Committee, a report by the departmental officers is laid upon thetable of the House, together with plans and specifications, and that in movinga reference to the Com mittee a speech is made by the Minister, explaining these reports and the reasons for their submission, as a matter of policy.
– I am in agreement with the right honorable member, but we cannot do that at the present time.
– I am quite aware that there are difficulties incidental to every new system.
-It is in this case a question of time.
-I am only suggesting what I think is the proper course to be followed by us when we meet again.
– I quite agree with the right honorable member.
Question resolved in the affirmative.
In Committee (Consideration resumed from16th December, vide page 2071) :
Clause 1 (Short Title).
.- When we were discussing the Bill last night, the Leader of the Opposition, the honorable member for Richmond, and the honorable member for Balaclava exhibited great concern as to the fund from which the interest upon this loan of £18,000,000 from the Imperial authorities is to be taken. I explained then that, whilst the whole of the loan will be paid into revenue, it is not a fact that any portion of it will be used for the purpose of paying interest on the £18,000,000 thus borrowed.
-No. It will go into the general pool from which the Treasurer draws his interest.
– The Prime Minister may put the position in any way that he chooses - it will remain the same.
– I will put it clearly in another way. I say that the interest on this loan of £18,000,000 will be paid out of revenue other than the £18,000,000 itself.
– There are many streams which feed that pool, out of which the Treasurer gets all moneys.
– TheEstimates do not bear out what has been alleged in this connexion.
Mir. Greene. - At the same time the total loanmoneys raised this year include the £140,000 which will be payable in interest.
– The Estimates say so.
– I have been long enough at the Treasurynot to be dogmatic about anything. My officers say that the Estimates do not say that.
– Then what do they say ?
– Read the schedule at the bottom of page 65.
– I admit that to the laymanit may seem to be a matter of some doubt. ButI submitted it to the Secretary to the Treasury, who is of opinion that neither on page 5 nor page 65 of the Estimates can it, be alleged that provision is made for the payment of interest out of loan funds in any way.
– That is the way in which it is presented.
– I am not going to dogmatize. But I saidpositively last night, and I repeat it now, that that is not the policy of the Government. The Secretary to the Treasury advises me that the Estimates do not bear out what is alleged, and that it is only a want of wit on our part which makes us think they say it.
– That is very kind of Mr. Allen I am sure.
– The statement prepared by the Treasury officers on this matter reads -
The interest payable to the British Government on the loan of £18.000,000 will, as shown on page 5 of the Estimates, be charged to the Consolidated Revenue. The amounts received from the British Government will be credited to revenue. It was not possible to credit a special loan fund, as the expenditure was for war purposes, and it was found to beimpossible to differentiate the special war expenditure from the ordinary naval and military expenditure. The only course left was to credit revenue with the loan proceeds, as is provided in the Bill before Parliament, and to charge revenue with the total naval and military expenditure. The interest will be charged to the general revenue, not to any part of it. and the same result will be produced as wouldhave accrued had the loan proceeds been credited to a special loan fund, and had the interest expenditure been charged to revenue. That is the statement made by those who are supposed to know something about this matter.
– The Estimates do dif ferentiate between the ordinary naval and military expenditure and our war expenditure.
– That has been done, as far as is possible, for the information of honorable members, but the two expen ditures have been so dovetailed that we are unable to give even an approximate statement of our war expenditure. Another point raised by the honorable member for Balaclava related to the money which has been borrowed. That money was raised at a minimum of 95.
– At a fixed price.
– I think there was a minimum.
– There was a standard price made of 95.
– My recollection is the other way. To enable the British Government to lend us £18,000,000 net, they had to raise about £19,000,000.
– Over £19,000,000.
– I think not.
– It was a little less.
– It was £18,947,368, to be precise.
– Does the Prime Minister obtain that result from the official figures? It simply means adding 20 per cent. to the£18,000,000.
– To add 20 per cent. in that way is rather an illusive method of getting at the position. But, according to the authorities, the amount which the Imperial Government raise has nothing to do with us. They propose to lend us £18,000,000 net, and the net interest payable by us for every £100 that we receive will be £3 19s. 7d. The term of the loan will be fourteen years. Last night the point, was raised that the loan from the British Government for war purposes, and the Commonwealth loan to the States, were for the same amount and for the same term. They are neither one nor the other. The term for which we are borrowing from the Imperial authorities is fourteen years, and obviously there is a difference between the rate of interest we shall pay and that which will be paid to us by the States. The loan to the States will be for one, two, or three years. That is the most convenient way of dealing with them. Obviously it is in the interests of the Commonwealth and of the States that our financial position should be impregnable at the close of the war, which might be even a more disturbing period than that we are at present experiencing, though, of course, it is not likely to be so dangerous. Therefore, the States, after the present difficulty has passed away, will be relieved of this obligation if they can get better terms elsewhere. If they can, they will probably embrace an opportunity to co-operate with the Comrnonwealth in their future borrowings.
– Are you able to say what the exact cost will be to the States for the bulk, if not the whole, of. the money ?
-Under the circumstances it will be a net 4 per cent. Under the agreement, if the Commonwealth, because of having made this loan to the States, has to raise more money at a higher interest for its own purposes, the States will pay the difference ; but I do not anticipate that it will be necessary for the Commonwealth to borrow further, or, at any rate, not to a considerable amount, on that account.
– If you fix this interest at 4 per cent. now it will have a tendency to remain at that.
– But it cannot, under the agreement. There was an indication at one time that the States were going to draw out of the arrangement, but there is none now: indeed, they now desire extended terms. The idea is that the States should give Treasury-bills for one or two years, as it suits them, so as to give them time to turn round. I presume that the business of the Commonwealth is, if it can, to see the States through their difficult period. In a word, we have arrived at a period when there ought to be full, healthy, and hearty co-operation between the representatives of the people in the Commonwealth and the States regarding the whole loan business.
– Why not regarding our whole financial business?
-I agree with the honorable member; but, in the meantime, there is nothing more dangerous than, when we have arrived at the specific stage, for some benevolent, large-hearted, large-viewed person to come along and say, “Why not take in the whole world? This only means, if attempted, that we do nothing; and my own view is that we ought to do one thing at a time, if we desire any results.
– And do it well !
– Yes. This broad, general idea of settling the whole affairs of the world in one glorious sweep, leads, in my experience, both public and private, to blunders, confusion, loss, and danger. I need say no more than to repeat that this Government will not pay interest on loan out of loan, but will raise the necessary revenue for the purpose. I should like to say just one word more. Although I have been a large-hearted supporter, largely because of prejudice, of what are called sinking funds for permanent or reproductive loans, I have always considered them a great absurdity in a new country. In my opinion it is only a child-like proposal to put something in a bank in case we spend it too recklessly.
– That is not what a sinking fund is.
– A borrowing State collects from itself to pay interest and sinking fund, and then proceeds to borrow out of sinking fund and out of credit elsewhere.
– It is a most dangerous doctrine the right honorable gentleman is preaching !
– I have made many “dangerous” statements on my own account, and I am not now dealing with the question of policy. I can understand a sinking fund for a work that is going to depreciate and decay, and will have to be renewed at the end of the specified term ; but in the case of railways and other works, which increase in value in a developing country as time goes on, sinking funds are a comparative waste, unless there is surplus money that cannot otherwise be utilized. I desire honorable members to draw a clear line between statements I have made on other occasions, and this expression of my own individual opinion. Some people think that, having provided a sinking fund and contributed to it in a spasmodic way for one or two years, they have done a most exemplary thing, and their conscience is quite easy, although a needy Treasurer may subsequently come along and “ mop it up.” I can speak quite freely on this matter, because a Government of which I had charge passed the Act which makes it mandatory, until the law is altered, to provide for interest and sinking fund.
– I hope that that law will not be altered.
– I am not proposing to alter the law, but merely expressing my personal opinion.
Sitting suspended from 11.58 to 2 p.m.
Clause agreed to.
Clauses 2 to 6 and title agreed to.
Bill reported without amendment ; report adopted.
Standing Orders suspended.
Bill read a third time.
In Committee (Consideration of GovernorGeneral’s message) :
Motion (by Mr. Fisher) agreed to -
That it is expedient that an appropriation of revenue be made for the purposes of a Bill for an Act to authorize the raising and expending of seven million five hundred and ninety-four thousand pounds for certain purposes, and for amending the Loan Act 1911, the Loan Act 1912, and the Loan Act 1913.
That the Report be considered at once.
That Mr. Fisher and Mr. Hughes do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Fisher, and read a first time.
Standing Orders suspended.
. -I move -
That this Bill be now read a second time.
The Bill authorizes the Government to supplement the revenue at any time by loans, which will be redeemed, in all likelihood, before the end of the year. The Bill is introduced to enable us to get cover. It is an unusual Bill, but it does not mean any increasing of our indebtedness.
– A fact which I shall merely note in passing is that honorable members opposite believe in following a good example. I remember their threats when last session we wished to provide out of loans for the works which are mentioned in the schedule to this Bill.
– That was in a time of peace.
– The purchase of land for post and telegraph purposes, the construction of conduits, and the laying of wires underground have nothing to do with questions of peace or war.
– We did not object to that.
– The honorable member should re-read the Hansard reports. He will find that the objection was very strong. It seems to me that a porcelain or earthenware conduit laid below the surface of a street cannot be regarded as a permanent work, because when the road is opened up it, in all probability, gets broken. A telephone tunnel might be regarded as fairly permanent. The sum of £450,000 is provided in the schedule for the construction of conduits, and for laying wires underground, work which cannot be said to be permanent. I do not object to the arrangement, however. Loans of this kind should be short-dated. In Great Britain the Treasury lends money to the Post Office, the loans being redeemable in ten or twelve years, for the purchase of material and construction of the kind here provided for. I think that we could adopt that plan with much success. I congratulate my honorable friend on having followed the good lead of the Liberals in placing useful capital undertakings to loan account instead of burdening the revenue with them. I suppose the borrowing flag has now been hauled down permanently.
– It was never flown. Non-borrowing never was, and never will be, a plank of the Labour platform.
– The platform speaks of the restriction of public borrowing, but at election times it is the flaming apostles behind the honorable member who interpret the platform. He merely deals in generalities, but it is they who make the statements that create the general impression concerning his party. Does he not remember the pamphlet written by the AttorneyGeneral, of which some hundreds of thousands of copies were issued ? It contained a series of articles succinctly summarizing the financial programme of the Labour party as a non-borrowing programme. This policy has won thousands of votes for the party. But having got into office, the right honorable gentleman, in obedience to his better instincts, has hauled down the flag. I wonder if he will drag it out again at the next election.
– If I fell, it was, in the first instance, by borrowing to make good a deficit left by the honorable member’s party.
-As the result of a year’s operations, we left a deficit of£450,000, which the right honorable member increased by £700.000 in a few months, and he liquidated the whole sum out of the, millions provided under an agreement which we made with the States.
– If the honorable member says that his party provided the money and robbed the States, I shall not contradict him.
– There was no robbery. The arrangement was considered a fair one.
– I quite agree with the honorable member.
– It was because of it that our deficit was incurred.
– In anticipation of something better coming. I shall stick to the honorable member while he keeps to facts.
– My right honorable friend will admit anything when in office, but out of office he will not make these admissions.
.- With regard to the£7,000,000 set out in the schedule, and which is to be paid into the Consolidated Revenue, I understand that last night the Treasurer intimated that part of this sum was the amount estimated as being necessary to meet the deficit.
– Yes. The deficit will be £2,588,000.
– But as authority to raise an additional £4,500,000 is being asked for, I presume that the Treasurer needs these bills for the purpose of anticipating the instalments that will come to us under the Imperial loan of £18,000,000.
– At the end of the year we shall probably be short of land tax to the extent of £2,700,000, and probate duty to the extent of £1,000,000. Though the money will be owing to us, it may not be collected, and therefore we must make provision to cover that deficit in our anticipations.
– As I understand the position, we already have a deficit of £2,588,000, and the Treasurer now seeks authority to raise Treasurybills in order to cover a probable shortage in the revenue anticipated to be derived from the new taxation, but these bills will have nothing to do with the war expenditure or the Imperial loan.
– If urgent expenditure is needed honorable members would hardly restrict the Executive in the use of this authorization. I am making provision in this Bill for every emergency. We could manage in another way, but I prefer to follow this method.
– In other words, these Treasury-bills are needed in order to give sufficient cover for meeting any shortcomings in the anticipated revenue?
– The Bill will give authority for incurring any expenditure except that already authorized by Parliament.
-I understood the Treasurer to say last night that if he found it necessary to incur any additional war expenditure above the instalments of the loan of £18000,000, which will come to hand at the rate of £1,500,000 per month, he would be able to make the necessary payments by means of these Treasury-bills, afterwards taking up the bill’s out of the Imperial loan instalments.
– I did say that. This. Bill will give us authority to incur the expenditure and make payments to meet it.
-I had hoped that the Government, in the event of their deciding to send more troops, would feel free to use the money proposed to be raised by means of these Treasury-bills.
– They can do so, but as Parliament will be in session by that time, we can appeal to Parliament again.
– Do the Government propose to raise no further troops until Parliament meets again ?
– We are raising more troops every day.
-I had hoped that this Bill pointed to a more vigorous enrolment of additional contingents, because the necessity for every part of the Empire doing its utmost in this connexion is borne in on us more and more every day. In asking us to vote this additional sum - because it is additional, though it may ultimately be redeemed out of other loan sources or revenue payments - I had hoped that the Government were asking for authority in order that any impetus given to enlistment in the meantime would be fully provided for.
-According to an answer given by the Minister of Defence yesterday, the proposal is to raise 3,000 troops a month.
-That is different from the statement made here.
– A little while ago we understood that the enlistment was to be 1,000 a month in order to keep the contingents that had gone forward at their full strength. If the number is to be increased to 3,000 a month this additional £7, 000,000 - and we can, if necessary, make it additional - will be needed. I hope that the Prime Minister, in common with all honorable members, recognises that every effort should be put forward by Australia to do its share towards bringing this titanic struggle to a conclusion at the earliest possible moment. Nothing can do that better than by jutting the greatest number of men possible in the field. For that reason I do not object to this large sum of money being raised by Treasury-bills, nor to giving the Treasurer the fullest authority to spend it in any way he chooses. I am sorry the amount is not greater.
– I do not wish the attitude of the Government on the question of our contingents to be misunderstood. The call to arms is being made on all Australians, and the work of providing for the training and equipment of additional men is going on at full speed.
– The right honorable gentleman means full speed within our present organization. The question is whether we can extend our organization in order to get more speed.
– If there is a better way of doing it I should be glad to have some indication of it.
– Advertise at the post-offices and railway stations.
– Has the Minister begun to draw on his militia forces for the purpose?
– Long ago the Minister called in all the capable men who could train others.
– Do not say that. The Minister said differently in the Senate yesterday. He said that he had not drawn on the militia forces.
– I have a distinct recollection of the Minister saying to me that the Department had called upon all the capable men they could secure in the militia forces as instructors and put them into special training* camps for the purpose of fitting them to train others to a state of efficiency sufficient to justify their despatch to the front. To send men away without training them would be of no use.
– We do not want that. Get the men and train them.
– As a layman, I consider that mere numbers would be of no use.
– At what rate are men now being enlisted ?
– At the rate of 4,000 a month. In fact we have to bring in an amendment to the Defence Act in order to validate what we have been doing. We have been straining the Act.
– We have been acting outside the Act ever since the war broke out.
– I do not think that that point is important. Far from limiting the number, the Minister is accepting any number of men that the Department can get.
– But is any special endeavour being made to get men to enlist?
– Yes. This is a national matter, and I would like members who make these suggestions’ of delay or tardiness to give a single instance of any.
– Is enrolment increasing or decreasing ?
– It is increasing.
– That is all we want to know.
– The last Government had the first call on everything - all the best trained men and the best of the equipment. Their successors had to pick up what was still available, but, to-day, we have had visual evidence that the second force is nearly as numerous and quite as efficient as those who preceded them. That result has been brought about by the system adopted immediately the Labour Government came into office, the system of getting men capable of instructing other men, and picking out the efficient amongst those who were offering.
– All those arrangements were in train at the time we left office.
– I admit it; but those who were training the men had as many as they could efficiently train at the time. We must remember that our capable instructors were very anxious to go to the front. There were positions offering to them,, and any man of grit -or manliness who felt himself efficient, if he had a commission offered to him, would wish to go to the front. In consequence, the Commonwealth was left pretty naked in the matter of instructors. The Minister thereupon set about the task of picking all the capable instructors from the militia, and these men are being specially trained in schools of their own, after which they are distributed over the Commonwealth for the purpose of training the troops now offering.
– We still have not half enough of them.
– The system is working splendidly. I agree with the Leader of the Opposition that there is a spirit abroad demanding a larger call to arms in Australia, and that there is among the people of Australia a desire to find the means whereby men can be trained and equipped and sent to the front in order to help to fight the battles of the Empire. There is no question about that. If the best method is not being adopted, I canassure the House, on behalf of the Minister of Defence and the Assistant Minister of Defence, that they will be very glad indeed to get suggestions from any member, and those suggestions will receive not only a hearty reception, but the most careful investigation and consideration that an honestminded person can give them.
– I would suggest that you get a better mob of horses than those in the procession this morning.
-That difficulty has been known to the Department for a long time, and I think it has been known to the honorable member.
-I do not think I ever saw such a bad lot of horses togetherin one body.
-We had better not discuss the quality of horses, because the difficulty is one which nobody can remedy. We cannot make horses. We can only pick them.
– There were horses in the procession that will cause trouble if they are sent away.
-I think they will bear comparison with some of the first selection. This morning’s Age contains the following report of a discussion which took place in the Senate yesterday -
Senator Millen said he understood that the total number of troops enlisted was about 33,000.
The Minister.-Between 39,000 and 42.000, with reinforcements at the rate of 3,000 . a month. That does not stop us sending more men if they can be equipped.
Senator Millen said he was delighted to hear that the number was greater than he had anticipated.
The Minister. -Every man who offers and passes the medical examination will be accepted for training.
Senator Millen. I don’t think the Minister will deny that we could double our recruits by employing recruiting agencies.No special efforts have been made to get recruits.
The Minister. -I agree that the difficulty is not in obtaining men.
Senator Millen. Is it a question of equipment?
The Minister. -You have not touched the question of training.
– Read my questions to you on the 25th November and your answers thereto.
– Certainly . On page 1026 of Hansard the right honorable member asked me a number of questions which were answered as follows: -
-My point is that those figures do not bear out what you are saying now.
-Those answers were given on the 25th November. The statement I have just made relates to the condition of things nearly a month later.
– The Government are evidently getting a move on. They will do a lot more if some shells are thrown into our cities.
– I do not think a shell or two would have a bad effect. Beyond the fact that we are guarding ourselves, there is nothing in this country at the present time to indicate that we are at war. We have had worse times as a result of ordinary drought than we are having to-day, despite this great war. I did not wish to belittle the patriotism of the people of Australia, especially of the young men who have flung themselves into the duties of citizenship with vim and determination. Their very step and deportment this morning show that the idea is getting abroad that there is something doing, and they desire to be at the seat of action. But so far from distress and destitution being apparent here, as it is in other countries closely connected with the war, the conditions are very nearly normal. But the patriotism is not less and the Government make an appeal now and always to those capable and fit to fight the battles of the Empire to come forward at once in such numbers as will enable us to settle this great issue in a shorter time than otherwise would be possible.
Question resolved in the affirmative.
Bill read a second time.
In Committee :
Clause 1 agreed to.
Clause 2 (Treasurer may borrow).
– These figures indicate to me very clearly that, unless some further effort is made, we shall not be able to keep more than 20,000 effective soldiers in the field for the year. According to these figures, and the loan Estimates submitted by the Prime Minister, we are providing for the maintenance of only 20,000 effectives at the seat of war throughout the year. That is the point I wish to bring home to honorable members.
-We are doing something on the water as well as on land.
-Of course, but does the honorable member think, in view of a war in which Great Britain has two million men in the field. France over three million men, little Servia over half a million, and Belgium considerably over a mil lion-
– Belgium has a population of seven or eight millions.
– Servia has only four and a half millions, and yet has half a million fighting men in the field. Domy honorable friends know that Switzerland, the population of which is a million less than that of Australia, has four hundred thousand men mobilized continuously?
– The Prime Minister has assured the right honorable member that everything possible will be and is being done.
– I may tell the Assistant Minister that all that is being done is not sufficient in my judgment.
-You ought to know the difficulties of the situation.
– Then what is the use of talking in that way?
– I would be glad if I could whoop behind the Government that everything possible is being done, but I candidly do not think that it is. That is why I consider it my duty to call attention to these figures which contemplate the maintenance of only 20,000 effectives at the seat of war. On the 25th November I asked the Prime Minister how many troops had been dispatched to the seat of war, and he answered 20,000. I asked how many troops were in course of preparation, and the reply was 10,000. I then asked how many men were required to maintain an expeditionary force of, say30,000 effectives in the field, and the answer given by the right honorable gentleman was, “ approximately, 2,000 per month.”
– That was on the basis of 20,000. That does not say that no more than 20,000 men are to be sent.
-I am pointing out that the Government, are not raising enough men to maintain even 20,000 effectives in the field.
-The Leader of the Opposition should be in the councils of the Ministry in this matter.
-I assure the honorable member that the Leader of the Opposition does not know any more about what is being done than anybody else. I am afraid that the Avar is crowding the proceedings of this Parliament out of the press altogether, andI have received a letter which shows how little our doings are being reported in these days. A gentleman in the country wrote protesting against the taxation that the Government are imposing, and desiring to know why I. as a member of the Cabinet during the period of war, had consented to the tax. It is pretty rough to have to stand the scorn of honorable members opposite as well as the criticism of one’s own supporters outside Parliament. The Prime Minister told us that approximately 2,000 men will be required per month to maintain 20,000 effectives in the field, and I am pointing out that that is more than the Government have provided for in their estimates for the whole year. All they have provided for, and apparently all the establishment is aiming at, for the year is to maintain those 20,000 effectives in the field. It seems to me that not many honorable members opposite, are aware of this fact. They hear these figures lumped together, and imagine that they represent the number of effectives in the field, whereas the fact is that these are the figures necessary to maintain as effectives, throughout the year, the 20,000 troops who have already been sent away. That is why I say we ought to do something more than we are doing. I believe every honorable member opposite feels in his heart that we ought to have more than 20,000 men fighting in the field.
– At what rate will it be necessary to send men away to maintain 20,000 effectives in the field ?
– Roughly speaking, 2,000 per month. Here are the figures: - 10,000 are now going away, and thereafter there is to be a first reinforcement of 2,800, a second reinforcement of 3,000, and a third reinforcement of 3,000. We cannot lump these figures together as representing the fighting force in the field. They do not. These reinforcements are to be sent away to maintain the 20,000 now in the field, and, therefore, I urge that we have yet to provide a bigger fighting force.
– Does the right honorable member think that we are going to lose one-half of our men ?
– As I said last night, the wastage of war in the field is calculated to be about 65 per cent, per m ti um. We have yet to recognise, I am if raid, the terrible nature of modern warfare, and what it really means.
– What is the expenditure necessary to keep this force effective from month to month ?
– This year we we providing £11,700,000.. If the honor able member divides that total by the months of the year, he will have his answer. I think that the Government have undertaken to receive about £1,500,000 per month from the Imperial Government for this purpose, but whether they are going to spend that amount per month, 1 do not know. In the Estimates for the whole year tue Government are providing for an expenditure of £11,700,000, £10,500,000 of which is to come from this loan, and the balance is to be made up out of temporary aid to the revenue from Treasury-bills. The fact that I wish to press home is that this expenditure of £11,700,000 for the year will just about keep 20,000 effectives in the field. lt is from that point of view that I urge the Prime Minister to consider whether the Government are utilizing to the full all the available forces, citizen and otherwise, who can be impressed - assuming, of course, that they are willing - into the training of the available material. My information is that there is plenty of good .material yet available for the instructors if the Government care to encourage and organize it. I am afraid that when Ministers say that all is being done that can be done, they simply mean that the present organization of the Department is working to its full capacity. But can we not expand that organization ? Can we not draw upon our Citizen Forces in order to get a move on. so that we may send away more and more troops?
.- I had not the privilege of hearing the speech delivered by the Treasurer in introducing this Bill, but I have since taken the opportunity to confer with honorable members to ascertain its reason, which is not apparent on its surface. I believe that at a time like this a Treasurer should have elastic power, more particularly if the taxes which it is proposed to levy under the Bills already passed by this House are late in yielding revenue. Their yield will probably be too late to be of substantial advantage for the financial year, and if our Trust Funds were not able to meet the requirements of the Treasurer, then the elasticity of the Loan Fund would probably best meet the position. The argument I desire to put for the consideration of the Treasurer is that I think it time we got away from this form of authorizing and issuing loan money. In most of the State
Parliaments with which I am familiar, they did adopt this mode of authorizing the raising and spending of money in the one Bill when they originally embarked upon a borrowing policy, but many of them have now got away from that practice. There arose a great disadvantage under it. When a Ministry with or without a strong majority brought down a measure which gave authority to raise money, and to spend it in the same schedule, it led to that old-established practice known as log-rolling, which Itrust has disappeared from Australian Legislatures. That is to say, when members of either the supreme or the Opposition party had placed before them a schedule of expenditure, there was a tendency to induce them to vote for. the authorization provisions in the earlier part of tlie Bill. What has been done, “after consideration, in many cases, is to separate the authorization from the application authority. In other words the Treasurer comes forward with a Bill in which he seeks authority to borrow, say £7,000,000, with no c explanation whatever as to how it is proposed to expend it. The Blouse is asked to trust the honour and wisdom of the Government in the exercise of that large authority. When that measure is passed, then the Bill providing for the application of the loan is brought down. I do not suppose the evil which that amended procedure was designed to cure has yet been felt in the Commonwealth Parliament, but there is a tendency for it to creep into our existence as our great public works expand.
– The same temptation does not exist in the case of the Commonwealth Parliament.
– Quite so; but if the Commonwealth is to build, as no doubt it will, in future decades, more substantial public works, and particularly railways, for defence or other purposes, there will be a tendency for State interests to receive consideration in. such propositions. I think it would be wise - and I make the suggestion with no desire to delay this Bill - if the Treasurer during the coming adjournment would remit this technical question of procedure for the consideration of the Finance Committee. That would in no way prejudice the prestige of the Government in this House. The taking of evidence by the Public Accounts Com mittee might lead us to follow the procedure which certain State Parliaments are now adopting.
– I have mildly suggested to the Public Accounts Committee that they might fairly well make a start by examining the Treasury officials. I shall give the Committee every facility to make inquiries.
– I am glad to have that assurance, because I believe that the Public Accounts Committee, in which we shall begin to repose trust, when it submits its reports, might have time for the consideration of matters with which Ministers are too busy to deal. Ministers are necessarily attached to certain propositions, and the impartial judgment of the Committee might help to bring about these changes.
– There are too many fools in the world for us to think that we are the embodiment of all wisdom.
– I hope that the right honorable gentleman is not referring to the Opposition.
– No; I include myself among the number.
– Then I shall join the right honorable gentleman.
Clause agreed to.
Clauses 3 to 6 agreed to.
Clause 7 (Commencement of Act).
– I do not quite understand why it is necessary to date back to the beginning of the financial year the commencement of this measure.
– I think it is convenient that it should cover the whole year. Nothing has yet been done that is in conflict with this Bill. If we did not adopt this provision we should have a halfyear period, and that would mean, I think, a double audit.
– It appears to me to be a provision validating certain transactions which have happened. If that is so, we should be told about it.
– We have made ad,vances to ourselves on account of revenue. This puts the matter beyond question.
– That is quite a different point.
Clause agreed to.
Schedule and title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
In Committee (Considerationof GovernorGeneral’s Message) :
. -I move -
That it is expedient that an appropriation of revenue be made for the purposes of a Bill for an Act to authorize the raising and expending of the sum of £2,000,000 for the construction of a railway from Kalgoorlie to Port Augusta.
This work has already been authorized, but the appropriations made for the purpose have been expended, and I have been paying a little out of Treasurer’s Advance to keep it going. It is necessary that a considerable sum should be appropriated for this work, which is proceeding from both ends of the line.
– There have been so many of these Loan Bills that it is difficult to keep count of them. May I ask how many more Loan Bills there are?
– This is the last.
– These loan Bills are becoming absolutely monotonous, and I suppose the money is needed; but I should like to know from the Minister of Home Affairs what is the cause of the
Blackening in the rate at which the railway is being built at the present time. I heard the other day that during the last six months there had been only about 25 miles built at both ends, whereas in the previous year the progress made was 150 miles. Of course there may be special reasons for this, and if so, I should like to know what they are.
– When the previous Government were in power the average progress was 15 miles per month, including the strike period.
– Speaking of that strike, which lasted about three months, I should like to know from the Minister of Home Affairs whether the men ever took advantage of the offer we made to them, as part of the settlement, that the whole question should be submitted to arbitration.
– I have not heard anything about it.
– The men while on strike clamoured for arbitration before a Judge of the Supreme Court of Western Australia, but now it would seem they do not desire any such mode of settlement. This line is of important strategic value, as well as of national and commercial value, and it is important to know what this slackening in the progress is due to. It may arise from increased difficulties in construction, but it isimportant that the reason should be known, because the earlier this line is completed the more likely are we to begin to earn a fair interest on the immense sums which have already been spent and which are now comparatively dead. Such a work as this should be pushed on to completion at the earliest possible moment for the reason I have indicated, especially in view of the fact that a further £2,000,000 is asked for, representing some £80,000 a year in interest. I take it that the money expended up to date is very nearly £2,000,000.
– Somewhere about that.
– That means, of course, £80,000 a year, in addition to the further obligation we are now incurring, and the sooner the railway begins to earn interest the better for all concerned. These remarks all bear on the question of the slackening in the rate of construction. As to the other matters, we are absolutely like putty in the Prime Minister’s hands; we must do just as he wishes. If he says “Loans,” we say “ Yes,” and if he says “ Taxes “ we have to say “Yes.” Altogether, it appears to me that the right honorable gentleman is having a “ merry old time,” and, just now, a complacent Opposition.
.-I wish to make clear my position, when Minister, in connexion with the dispute at the Port Augusta end of the line. A short time ago I received a letter from Mr. C. L. Gray, secretary of the Australian Workers Union, of which practically every man engaged on the permanent way construction is a member. This gentleman had some conversation with me prior to the fixing of a working agreement under which the men undertook to observe existing conditions as far as Tarcoola on a basic rate of11s. 8d. for the lowest paid labour. Mr. Gray’s letter was as follows: -
Port Augusta, 26th November, 1914.
On the recent visit to Port Augusta of the Hon. A. Poynton and Senator Newland, these gentleman stated that you had repudiated the agreement made with the Australian Workers Union as from April 1st.
As the agreement was sanctioned by you by wire at this time, and as no notice of such repudiation ever reached us, I cannot understand the assertion made.
In that agreement we undertook to maintain stable conditions on the work right through to Tarcoola at the rate of11s. 8d. minimum for the 50 miles, and ‘’’ existing conditions regarding privileges,” &c, were “ to continue.”
TheEngineer-in-Chief on the reconsideration of the Director of Transport, now seeks to annul the privileges regarding passes to workmen on the line.
We have asked that this agreement be adhered to, but it is claimed that you repudiated it, and that it is consequently not in force.
Regarding this pass business, we recognise the necessity of regulation, and are prepared to co-operate with the Department in any reasonable proposal, but we claim that under the terms of the agreement any new regulation should he not less favorable than this regulation of 1st April.
This by way of explanation. I should be greatly obliged if you would advise me as to whether the statement made by Messrs. Poynton and Newland was correct.
I referred that letter for the facts to the Railway Department, and received today the following reply: -
With reference to the letter received by you from Mr. C.L. Gray, of Port Augusta, I have to advise that since your Government relinquished office the question as to whether the men were entitled to free and indiscriminate use of the railways has been the subject of some controversy between the union officials, on the one hand, and the Hon. the Minister and myself, on the other.
The point is that the question arose after I left office, and yet the charge against me is that I repudiated the agreement. However, we are fortunate in having amongst us the honorable member for Grey who will, no doubt, put the matter right.
– What about preference to unionists?
– The honorable member is trying to discuss anything under the sun except the particular matter before us, and I may point out, in connexion with this side wind, that an erroneous charge was made against me by the honorable member for Cook, that I had in the agreement given “ preference to unionists “ to a greater extent than any previous Minister. The letter from the Railway Department continues -
I have no knowledge, of course, of what Senator Newland and the Hon.A. Poynton represented, but the attitude that I personally have taken up from time to time is, first, that to permit the men to use the open railway for free travelling practically whenever desired, would be a bad principle for the Commonwealth to introduce, inasmuch as there is no precedent in the practice of any of the States, and an all-round condition of laxity would develop, which would be extremely objectionable. Secondly, I have re presented that, when the agreement referred to in Mr. Gray’s letter was under consideration, this question of allowing the men the free use of the open portion was not even remotely considered. I have held that any references to privileges in the agreement which you dealt with did not, and could not, include this as a privilege, because the men were not at any time entitled to it. All that had happened was that, in the absence of adequate check, they had taken free rides on the railway as then existing, without any proper recognition of the practice as a privilege. This, at the time, was a matter of minor importance, because only a comparatively few miles of line had been constructed, but to imagine that a railway extending over 1,000 miles could be abandoned to the free use of any one who cared to come along and use it (which would be the meaning of Mr. Gray’s contention as to privileges) is, I am sure you will agree, quite out of the question.
I might say that the instruction limiting the free travelling upon the line became effective at the beginning of September. As far as I can recollect, you were not consulted in any way regarding it, as you were at the time absent from Melbourne. The instruction was issued as a purely working instruction, and one not involving any question of policy whatever. The dispute referred to herein developed after your Government had resigned.
In the existing instructions provision has been made for married men whose homes are established in the neighbourhood of the base to travel free, on properly issued passes, between their work and the base at week-ends from time to time, and also for the free transport of all employes and their families between the work and the depot in both directions at the Christmas and Easter holidays.
The facts as stated in that letter show that there was no justification whatever for any statement - if made, for I do not say the statement was made - by the honorable member for Grey, or Senator Newland, at Port Augusta, seeking to place on my shoulders the unpopularity resultant on the decision which the present Minister has come to at the instance of his advisers. I feel sure that the honorable member for Grey, who is in the chamber, would not care to try to escape, in the way suggested by Mr. Gray, the unpopularity of being associated with this Government. I wish to make it perfectly clear that in this, as in all other agreements, my word as Minister was my bond, and I always endeavoured to observe it to the full.
– Did the honorable member, as Minister, consider the question of the indiscriminate use of the railways ?
– It never came under my consideration at all.
– The progress ought to be at the rate of a mile a day at the western end.
– I shall not go into that question, nor shall I refer to any dispute which the honorable member for Wentworth may have had with Mr. Gray, or any other person. All the men employed on the line are not members of the union.
– The men employed as navvies all belong to it.
– Men all over Australia who are unfortunate enough to lose positions in other callings and occupations often take on navvying work, and it does not require long for them to become efficient. A labouring man of average physical strength can soon become accustomed to that sort of work. It will be a bad day when we make this employment exclusive. When only ten or fifteen miles of a line have been constructed, there is no objection to the men who are employed on the construction work riding to and fro on the waggons which are carrying material, but when the line has been made for many miles, it is ridiculous that those engaged in the construction work should claim the right to ride free of cost on the trains at any time. The traffic on that portion of the line which has been constructed is not equal to the traffic on the line between Melbourne and Adelaide, but there is a traffic in station supplies and other material. The Engineer-in-Chief conferred with me on the matter, and I acquiesced in his suggestion that married men should have certain privileges, and that passes should be given, but that there should not be indiscriminate free travelling. That is the present position.
.- I wish to make references to the occurences at Port Augusta that have been mentioned. There was a dispute as to whether the agreement entered into by the honorable member for Wentworth, when Assistant Minister of Home Affairs, gave the right to travel over the railway indiscriminately. It was held by Mr. Gray that it did, and that the men had a legal right under the agreement. There was also talk of a possible strike. I do not remember using the word “ repudiation,” but I said that the agreement had never been signed.
– I personally would regard my telegram as sufficiently binding.
– The agreement wasnot signed. When the matter was raised in this House, the honorable member said that he did not give preference to unionists in the fullest sense, and that he had not signed the agreement. Senator Newland and myself did not state that he had repudiated the agreement. We did not wish the men to incur the expense of going to law, nor did we desire a strike, and we therefore gave them to understand that the agreement had no force in law. The honorable member has admitted by way of interjection that the agreement did not give the right claimed under it of indiscriminate travelling on the railway.
– I said that the matter had never come under my consideration.
– The question arose after the honorable member left office. When a section of the line was declared open for traffic, the travelling privileges were reduced, the reasons given being that it was not in . the interests of the men themselves, nor of the work, that they should be allowed to travel backwards and forwards as they liked. I am not satisfied with the progress that is being made. The Minister stated, in an interview at’ Adelaide, that twenty miles had been constructed in three months, and that the progress had not been greater because of the difficult nature of the country which had to be passed through. [ have been over the line, and know the country, and, in my opinion, the country cannot be regarded as difficult. The scarcity of water is, of course, a great hindrance to construction. There is no water out from Port Augusta. At the time of my visit the distance to the rail head was about 142 miles, and between 70,000 and 80,000 gallons of water were being daily despatched from Port Augusta. That meant the use of a great deal of the rolling-stock, of which there is only a limited supply. In the first instance, an engine could not be constructed in Australia, and we had to fall back on two old engines brought from New South Wales. Since then other engines have been obtained. The only water available, unless condensed water is used, is water which is not used on the South Australian railways because it damages the boilers. Contracts were let for the construction of engines, but, as in the case of every other contract, whether for rollingstock or for anything else, the contractors have been behind their time.
– The trouble is mainly local. The oversea contractors are generally up to time.
– The contract for water gins is dreadfully behind time. Nothing can be more important than to have a sufficient supply of these gins because they soon get out of repair and become useless.
– When is the line likely to be finished, at the present rate of progress ?
– The work will take considerably longer than the estimated period. There is a little cutting about Eucla, near what is known as Phillips Ponds, though nothing very serious, and beyond that the work is practically a plate-laying proposition. Since the Minister made his statement there has been much greater progress. I think that if he could make a statement now, it would be seen that the progress has been materially improved.
-I did not know that this discussion was coming on; otherwise I should have been able to give the Committee every information.
-The departmental officers consider that from now on the progress will be more rapid. When I was there, between 1,600 and 1,800 men were being employed. They had to be supplied with water, and so had every person on the line, including the gatekeepers where the line passes through vermin-proof fences. It would not be necessary to make such frequent stoppages to deliver water were larger tanks supplied for its reception. With more engines and rolling-stock, it should not be difficult to construct at least a mile of line a day.
Apparently to stop talk of legal proceedings, the honorable member for Grey stated that, because the agreement was not signed by me, the union had no rights under it. But I regarded my telegram as a sufficient guarantee to them. Had I remained in office I should have dealt with the question whether the loose system of indiscriminate travelling was or was not a condition existing at the time I made the arrangement. I should certainly not have sheltered myself behind any legal technicality as to the signing of the agreement.
– The Leader of the Opposition asked why the earlier rate of progress in the construction of this line had not been maintained during recent months, and the Minister explained that it was because the rail head had got into different country, earthworks being more numerous.
– There was a fair amount of cutting to do at Lake Windabout, but the country is not difficult.
– Not in comparison with that in the eastern States. According to the honorable member for Grey, the difficulty arises from the scarcity of water. Thus earth and water are respectively given as the reasons for the reduction in the rate of progress. If I am advised correctly, neither is the true reason. I have been told by persons who ought to know, and as the result of their own observations, that the loafing on the line during the past two months has never been exampled in the history of this country.
– I do not think that that is correct.
– I pretty well know where the information came from - it came from some of the contractors.
– It did not come from a contractor. It came from a citizen of South Australia, whose people recently have been through there, and have watched operations. I have made all the inquiries I could, and I have found that the evidence was collected with all the care th at is possible for a citizen who cannot interrogate people on oath. However, assuming this to be the case, it is a matter that the Minister should inquire into with all due speed.
– I shall do so, but, at the same time, I do not think it is a fact.
– If there is an official inquiry into the cost of moving earth, the result will show that the cost is now less than the price paid to Mr. Teesdale Smith. The maximum is ls. ; the average runs from 5d. to lid. a yard.
– I am not in a position to judge the accuracy of the honorable member’s statement. It is made in all earnestness and sincerity, but it may not be true. The Minister should make inquiry, but not in any sympathetic way in order to shield the organization or individual. If men decline to yield to the nation a proper return for the reward they get in the shape of wages, whether they be unionists or not, they should not remain in the service of the Commonwealth.
– The matter can be proved in the method suggested by the honorable member for Grey.
– That is an engineering test. In the matter of shifting earth and making embankments, there are wide disparities throughout Australia, brought about by the varying characters of the soil and sub-strata.
– Any excess in the cost of the railway will not be found in the cost of the earthworks.
– Where would it be found ?
– In the water difficulty.
– Or the labour difficulty ?
– The labour difficulty exists in your imagination.
– This is the Minister who promises to hold an immediate inquiry into the truth of the statements I make; this is the spirit in which he will approach the matter. I should suggest that he should come to its consideration with an unbiased mind, and that he should be prepared to do his duty, whoever is at fault; yet he at once makes up his mind that there is nothing in it, and he sneers at any possibility of there being a labour difficulty.
– The honorable member is prejudiced.
– I have a prejudice against the way in which the Minister is carrying out this work and other work bv adopting the system of preference to unionists; but I ho)pe that 1 am sufficiently fair and observant to say that sometimes work can be conducted with proper success by unionists. I make no such statement as that unionists always loaf, but I do say that, whether they be unionists or not, if men are acting as my informants suggest that these , men are, they should be dismissed at once.
– Every one admits that.
– If the Minister comes to his inquiry in the spirit which his sneer indicates, he is unworthy of occupying the position fie now adorns or thinks he adorns. I did not rise to quarrel, but I cannot help it when I see the Minister forget his position and the responsibility attaching to it, apparently thinking that he is as much a free lance as I am.
– If inquiry is made, I think it will be found that the difficulty is not owing to labour cost. It will be in the other direction.
– I hope that the honorable member’s thought will prove to be correct when tested.
– I should like to see an inquiry in the interests of the matter you have raised.
– I was about to deal with the matter raised by the honorable member for Grey, that of the water difficulty. This is due to the fact that the Department has not sufficient rolling-stock to carry provisions and water along the line. .
– Or material.
– This matter should be remedied at once. The construction of rolling-stock does not take long.
– What are we to do if the contractors are late in delivering the rolling-stock?
– Ministers should fine them. That is what we often have had to do in the States.
– That would not get us the waggons.
– If the Minister is not satisfied’ with the progress registered under the contracts, any State Government, east or west, would turn out sufficient haulage or traction stock in a month or two to put his contracts in decent order. In any of the State workshops rolling-stock for the broad-gauge or the narrow-gauge system could “be made. To have men in the desert who cannot be supplied with rations or water in proper quantities to enable them to do a profitable day’s work is unbusinesslike. Especially is it not workmanlike at this time when unemployment is considerable to have on account of these disabilities few, instead of many, men working. I am seeking information on this occasion; I am not dogmatizing like the Prime Minister. There is another matter to which I desire to refer. All the State railway systems of Australia have the double-buffer system. I have not had the privilege of visiting the railway west of Port Augusta, but I am informed that the Commonwealth propose to operate the single-buffer system, under which there is only one buffer in the centre. This system operates in some railway systems, and if it is to be adopted on the Commonwealth railways, there will be, in addition to the break of gauge, another great difficulty created. No doubt the break of gauge difficulty can be solved by the methods proposed by the Prime Minister, but, if on the central link of the Australian railway systems the single-buffer system of rollingstock is employed, it will be impossible to transport mixed rolling-stock from one side of the continent to the other. The two systems cannot be mixed.
– I think that the proposal is to have the single-buffer with patent couplings.
– If that be the case, great difficulty will be created, and there will be a further dislocation between the State and Commonwealth interests. In addition to the necessity for converting the gauges there will be need to convert the ends and undercarriages of all the trucks and cars of either the States or the Commonwealth. In this case it would probably mean the conversion of the Commonwealth stock, because of the scores of thousands of engines and trucks operating on the State railways as compared with those that will run on the east-west line. The cost of converting the State rolling-stock would be much greater.
– The single-buffer system is adopted because of the additional safety to men during shunting operations.
– That may be so, but America has shown that there is another way, that is by having an automatic coupling system by which men can couple trucks from the outside, and I believe that the adoption of this system has led to the loss of fewer lives. Will the Minister note this matter of the singlebuffer system ? There should be inquiry into it without delay. Before extra money is spent on rolling-stock of any kind we should know whether the stock will be capable of use for the purpose of transporting goods or passengers, or even for defence purposes when mixed with the rolling-stock of the States. Should we need to transport troops from Melbourne to Western Australia over a railway system with a uniform gauge, possibly we could not. run the State rolling-stock beyond Port Augusta, because mixing the State rolling-stock with that of the Commonwealth might be impossible. A single buffer waggon could not couple with a double buffer waggon. When the present Government caine into office the Government stroke became a real fact on this railway, and, in addition, when preference to unionists was publicly proclaimed as the policy of the Government, the men on tlie job, if my advice is correct, said, “ We have no competition except from men of our own school of thought.” If that be so, would there not be a tendency to slow down?
– Do you believe all that you hear?
– I do not believe anything that proceeds from the front orifice of the honorable member. There may be a soul of truth in things erroneous, and the honorable member may occasionally vomit a half-truth, but we have not had any so far from him this session.
– If inquiry is made, it will prove whether the men are loafingbecause they are nearly all on the earthworks.
– It all depends upon the man making the inquiry.
– There is a system of costs. You do not infer that the engineers fake the figures.
– I do not; but the officer sent to make the “inquiry, knowing his Minister, and also that he has sneered at the very suggestion of there being idle time on the work, will not injure his reputation in the Department by running counter to the views of his Minister.
– Is that your experience?
– Was that the cause of some of the reports that, at times, we could not credit in the State Parliament?
– I donot know what reports the honorable member refers to. He has always been acknowledged as an authority on that kind of comment. It is the only kind of comment within my experience that he knows. He has a dark, crooked mind.
– The honorable member is exceeding the limit of fair criticism.
– Very well, I shall stop just there. I urge the Minister to be careful in the selection of the officer he sends to inquire into this matter, because, as suggested by the honorable member for Grey, one kind of inquiry will finalize these assertions, and stamp them as right or wrong. In the interests of the taxpayer and of the western part of our federated system, the link with the eastern part should be completed with all possible speed. I confess that I was once opposed to this “ desert railway,” as it was then called. I am still against the “ desert capital,” or the “ ‘possum capital,” or the “ wombat capital,” as it may come to be called.
– You will come round to that in time.
– I may, if I get the truth from the honorable member. However, as a Victorian, my vision has been widened to the fact that we cannot expect Western Australia to consider itself an integral part of the community of Australia, enjoying the circulation of its life and ambition, unless we link it up on the mainland by means of this railway. In that spirit I recommend, not only all economy in the construction of this line, but alsoall possible speed. Apart altogether from the consideration that would influence the right honorable gentleman who leads the Government on questions of defence, and whose idea is’ that this railway, in addition to other reasons, should be thrown westward in order that Perth and Fremantle may be defendable by troops sent, if necessary, from the eastern side of the continent-
– Speaking from a defence aspect, we would need to have the eastwest connexion further north, and not on the coast at Port Augusta.
– Yes ; but the loop one would make in order to avoid contact with, the coast-line would be of comparativelyeasy construction.
– I do not think so; it is as. difficult matter to get over the FlindersRange.
– That may be; I do not know anything of the geographical features. I do say, however, that from a defence point of view, the Government, would be wise to push on with the railway. Also, from the stand-point of allowing Western Australia to feel that it is part of the Australian nation, and to give that State a freer and more easy access to the main bodies of populationon the southern and eastern shores of Australia, we ought to go ahead as rapidly as we can. That means speed in construction, but not speed at the sacrifice of cost. I hope the Minister will look into the cost item, and that by the expenditure of the same amount of money he will be able to insure greater celerity in construction, and consequently an early completion of this important work.
Question resolved in the affirmative.
Standing Orders suspended.
That Mr. Fisher and Mr. Hughes do prepareand bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Fisher, and react a first time.
Motion (by Mr. Fisher) proposed -
That this Bill be now read a second time.
.-I do not propose to raise any debate on this Bill, but one thing I should like to urge on the Minister - and I think it can properly be urged on the Prime Minister also - is that the time has arrived when the Western Australian Government should be called upon to carry out itsagreement to build a line of 4-ft. 81/2-in. gauge from Kalgoorlie to Fremantle. The cost of the construction of the transcontinental line is very considerably increased by the fact that there is a break of gauge at Kalgoorlie. If this line were being constructed by a private person at his own risk, with an agreement with theWestern Australian Government such as that to which 1 have alluded, he would undoubtedly have made great sacrifices to insure that the Western Australian Government carried out its part of the programme in order that he might get supplies to the rail-head without the expense of double handling and extra traction. The agreement is that theWestern Australian Government shall construct the 4-ft. 81/2-in. gauge from Kalgoorlie to the coast simultaneously - that is the word used in the correspondence - with the construction of the Kalgoorlie-Port Augusta line. They are not doing that. When Mr. Scaddan had some dispute with me, as Assistant Minister for Home Affairs, regarding a sleeper contract, he spoke in such a strain in Western Australia that it almost seemed for a moment that he was throwing off the veil, and had no intention of carrying out the promise When he was in Melbourne he explained that his Government were prepared to honour the promise, but that, owing to the State being financially involved, it was difficult at that time to go ahead with the work. I do not think it is a difficult matter for them to go ahead. It ought to be a very easy matter, and every step should be taken by the Commonwealth Government to see that the Western Australian Government undertake the work which they agreed to do. The position has become a farce. The Commonwealth is constructing a 4-ft. 81/2-in. line between Port Augusta and Kalgoorlie. The Western Australian Government are deliberately abstaining from carrying out their written bond, and at the other end the South Australian Government are constructing a 5-ft. 3-in. line from Port Augusta to Adelaide. Prom the defence point of view, the position becomes farcical, and it is utterly ridiculous to talk about the value of this line from a military point of view under the circumstances. I understand that the difficulty in Adelaide is that the Railway Commissioner, like so many State servants, persists in looking at the matter through State spectacles. The railway mancontends that the break of gauge must be at a place away from the centre of population, so that there will not be two sets of rails entering Adelaide. But the Commonwealth requires to be able to load troops on a train and send them off to their destination, without having to encounter on the way the difficulties of a break of gauge. If there is such a break, it is easier to transfer troops in a big centre than in some outlying place a couple of hundred miles away. This problem must be faced, and the Governmentmust take prompt action. If the South Australian Government persist in what I regard as an anti-Australian attitude on this matter, I would strongly urge the Commonwealth Government to consider the construction of a 4-ft. 81/2-in. line from Port Augusta through to New South Wales, and connecting up with the railway system in that State. I think it is an infinite pity that South Australia is constructing a line from Port Augusta to Adelaide on the5-ft. 3-in. gauge.
– There is no doubt about that.
– I think the State claims that to build a line on the 4-ft.81/2-in. gauge would constitute a grave difficulty to the State railways. But I would be prepared to suggest that the Commonwealth should meet the State Government in some way that would involve no injustice to them, and at the same time would conserve the Commonwealth interest. At the other end of the line the Western Australian Government are under bond to the Commonwealth, and are we to allow the interests of Australia to slide simply because the Western Australian Premier chooses to disregard his promise ? . The line from Kalgoorlie to Fremantle is some 380 miles in length. It cannot follow the present 3-ft. 6-in. track, because the curves are entirely different from those of a 4-ft. 81/2-in. line, whilst the gradients for an express service would be in no way met by those on the existing narrow-gauge track. Some of the country through which the line, will pass is fairly heavy, involving a considerable quantity of earthworks, and also the purchase in advance of big supplies of material and rolling stock for the construction of the line. It is, in fact, a very big enterprise, and if the Western Australian Government were to start now to construct the line, they would be too late to carry out their promise. A really pessimistic view of the date of completion of the transcontinental railway is that it will be finished in two years’ time. I hope the work will take less time than that. However, let us consider the matter on the basis of two years. It would take the Western Australian Government at least that time to build the 380 miles of railway from Kalgoorlie to Fremantle if they started ordering their supplies and making their arrangements at once.
– You cannot urge that too strongly on me. If I had my way the Commonwealth would do the work.
– No doubt the Western Australian Government would like that very much. If the light honorable gentleman were to look into the file in the Home Affairs Office he would find that the Western Australian Government drives the hardest bargain of any people in the world. They are very peculiar people to deal with.
– They are not alone in that respect.
– I give the palm to Western Australia. The Government and people of that State are actually making a. large sum of money out of haulage and other charges in connexion with the construction of the line from Kalgoorlie to Port Augusta, and there is no shadow of excuse for their refusal to carry out their written bond. I do urge upon the Government that this matter must be tackled without further delay.
.- In regard to the construction of the Port Augusta-Kalgoorlie railway, I have on two or more occasions asked the Minister of Home Affairs questions, and have urged, as the honorable member for Balaclava did to-day, that some inquiry should be made into the progress of the work and the method of construction. The Minister has, in a sense, resented my inquiries, but there is no idea of attacking his administration, because his accession to office is of such recent date that no charge can be made against him. Nevertheless, the manner in which the work is being carried out must appeal to anybody who has a knowledge of jobs of this kind as being extremely unsatisfactory. The Commonwealth spent last year over £1,300,000 on that railway, but nobody knows how the money was spent. It was simply handed over to the Department. The Minister has stated that periodical reports are made in regard to the progress of the work. I ask him how often those reports are issued ?
– Every two months or three months.
– The Minister knows nothing at all about the work, nor does any member in the House. This House is entitled to have the fullest information regarding the expenditure of that money, and the Minister should bear in mind that when the honorable member for Balaclava attacks the day-labour system in the way he has done, the Minister should, in defence of the principle he has so assiduously urged for many years past, if he recognises his position and is fully alive to his duty, demand an inquiry at once. A Public Works Committee has been appointed, not merely for reporting on proposed new works, bub for other purposes. It is a competent body, and fully alive to the situation, and I think that Committee should inquire into this matter, and let Parliament know exactly what is being done. In connexion with the provision of the water supply, for instance, a contract for the construction of a dam at Gibson’s Camp was let bv the late Government to Mr. Timms. I am credibly informed that after the dam was excavated it was not made watertight for several months; in fact, I doubt if the work of making it watertight is yet complete. In the interim, there had been heavy rains, which would have filled the dam had it been capable of holding the water. I believe that the dam at Lake Windabout is not yet commenced.
– I think it was commenced a month or six weeks ago.
– The dam at Eucolo Creek is in the same position. Whose fault is that? From the inception of this work to the present moment it has been carried out in a most unsatisfactory manner. I have not had an opportunity yet of seeing the work, but my information is from a reliable source.
– Have you any information about the loafing that is going on ?
– I understand that quite the reverse is the fact.
– I think the honorable member’s indictment is much more bitter than mine.
– In certain respects, but not in regard to the day-labour- system, because, if an inquiry is instituted, it will prove conclusively that the daylabour system on that line is doing the work at prices which will compare favorably with those on any works in Australia constructed bv either contract or day labour. We have a reputedly competent staff computing the costings of the job, and I think their figures will prove the truth of what I am saying.
– In that respect your information confirms mine.
– We make these statements in all sincerity believing it to be in the interests of Australia that we should do so. If the Minister would look at this matter from the same point of view, and would not allow himself to be dominated in any way, he would institute inquiries so as to prove conclusively whether the statements made to us are not credible, or are founded upon fact.
– It was because we thought that cases of this kind might be relegated to the Public Works Committee that some of us desired that it should be a nonparty body.
– Quite so. The Minister said yesterday that this work was passed prior to the passing of the Bill providing for the appointment of the Public Works Committee; but this morning he submitted to the House a motion to refer to that Committee works which under the Act are specially excluded from the scope of its inquiries. If he can do that in the one case he should bc able to do so in the other.
– The power of the Parliament is unlimited.
– Undoubtedly, and just as we have referred to the Public Works Committee the works to which I have just alluded, so we could remit this matter to it. It is in the interests of the day-labour system, which has been attacked again and again, and quite recently in connexion with the TeesdaleSmith contract, that the course I suggest should be at once adopted.
Question resolved in the affirmative.
Bill read a. second time.
In Committee :
Clauses 1 to 3 agreed to.
.- As I have not followed this particular transaction very closely, I should like the Minister to tell me how the interest is paid on the cost of constructing this railway at the present time, and will be paid until it begins to earn a substantial revenue.
– In answer to the honorable member for Balaclava I desire to explain that we debit the revenue with 31/2 per cent, interest and1/2 per cent, sinking fund.
– If the revenue from the line is not sufficient, what will happen?
– I should say that we would have to debit the revenue accordingly. If the revenue derived from the line were insufficient to cover working expenses we should still have to continue the charge. At present we are practically obtaining no revenue from the railway.
.- There is a deficit, of course, at present, because until the line is in full working order there will be very little revenue from it.
– This is the first year in respect of which we expect to obtain any revenue from it.
– And there is interest due on past loan payments for the construction of this line, just as there will bo in respect of this a impropriation of £2,000,000.
– In the case of State railway constructions it is customary to pay interest out of capital until the line is open and starts to earn revenue.
-We do not do that.
– It is paid out of revenue ?
– Yes. I think thepractice referred to by the honorable member - that of charging to loan account interest on capital expenditure until the work has been completed, and where perhaps the process of construction is lengthy - is a very bad one. We started to charge interest on capital from the time that we began to expend money on this work, and we intend to continue that practice. We hope the happy day is coming when the income from this line will exceed working expenses and interest, and when, therefore, we shall not have to make any debit to revenue account.
– I am reminded in connexion with this matter of a question which I had intended to put to the Treasurer on several occasions. He ia paying out of his revenue all sorts of charges for all sorts of purposes, and, amongst other things, he is providing for aid to his revenue by means of a fresh issue of Treasurybills. Are we to have now the Bill providing for that issue? I am speaking now of the amount of £2,588,000 referred to by the Treasurer in his Budget statement.
– That amount is included in the Bill we have already passed providing for the raising of £7,000,000 odd.
– I should like the point raised by the honorable member for Balaclava to be cleared up. I understand the normal practice in the States to be that interest during the period of construction is debited ultimately to loan account, and becomes a permanent charge upon the railway in question. If the Treasurer is now paying interest out of revenue in respect of the cost of constructing the Kalgoorlie to Port Augusta railway, will he not at some point or other make a readjustment?
– Speaking from memory, I think that under the Act passed by us we debit the revenue with interest on all loans from the time that the money raised is allotted to any particular work. We provide out of revenue for per cent, interest and * per cent, sinking fund.
– There was a special appropriation of £7,654 last year for interest on the cost of the Kalgoorlie to Port Augusta railway.
– There was not a great deal spent.
– I take it that at some point that which we pay out of revenue in respect of interest during the period of construction will become a charge upon the railway itself?
– In the absence of the Leader of the Opposition, I explained to the honorable member for Balaclava a few minutes ago that the income from this line at present is not sufficient to pay much more than working expenses, but we look forward to the time when the income will be sufficient to pay working expenses and interest.
– We snail all be in London or Heaven by that time.
– I have heard that kind of statement before. I would suggest to the honorable member that when time aud opportunity offer he should take a tour through Australia. If he does, he will come to realize that all lines opening up new country pay after a time. They grow gradually, this especially being the case in respect of rail ways running at right angles to the coast-line. It would be foolish to lav down any policy of this kind. This line, I think, will pay working expenses practically from the time it is opened, and is its revenue increases, so the interest bill will gradually be reduced. Meantime the principle laid down by a previous Administration, of which I was the head, is being observed. It is that we should pay out of revenue interest and sinking fund on loan expenditure after it has been allotted* to any service. That is what we are doing in this case.
– Interest and sinking fund in respect of all the State railways axe provided for out of revenue; but there is a special railway account kept, and every line is debited with its own total cost. Are the Government proposing to do that in this case?
– It has not been done so far.
– I am sure that the course mentioned by the right honorable member is being followed by the Treasury.
– I am afraid not. I think the right honorable member will find that these interest payments now going out are being debited to the revenue, and no special account kept of them. We can have no sound system of finance if every construction work of this kind does not carry its own obligations to the full, both during the period of construction as well as during subsequent operations.
.- I think that I might put in another way the point made by the Leader of the Opposition. It is that, until this line is declared open for traffic, all its revenue and all its expenses, from whatever account they may be paid, should be credited and debited respectively to a particular account.
– It is easier to adopt that course in the case of this line, because there are no complications.
– They exist, hut not to the same extent as in the case of other lines.
– In the case of a railway linking up with another line, it is more difficult to proportion the receipts and expenditure
– That is so. There will he some traffic on this line after certain works which the Minister has in view have been opened up, and when Tarcoola is reached. I have no quarrel with the steps taken to pay interest on loans from the outset. But interest on loans for a railway construction that is not yet completed ought to be added to the cost of construction, otherwise the full cost of the line is not shown.
– The honorable member thinks there should he a bookkeeping entry?
– That is so.
Title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
In Committee (Consideration resumed from I6th December, vide page 2064) :
Postponed clause 2 -
In this Act, unless the contrary intention appears. . “ Dependants “ means such of the members of the family of a member of the Forces, whose death or incapacity results from bis employment in connexion with warlike operations, as were wholly or in part dependent upon his earnings at the time of his death, or who would, but for such incapacity, have been so dependent: and where the person -
being the parent or grandparent of an illegitimate cnild. leaves the child so dependent upon his earnings: or
being an illegitimatechild, leaves a parent or grandparent so dependent uponhis earnings,
Includes such an illegitimate child and parent or grandparent respectively….. “Minister” means the Minister of State for Defence…..
.- The Government propose, as far as possible, to comply with the request made last night by -several honorable members, and especially by the honorable member for Grey.I therefore move -
That after the word “dependant,” line 11, the following words be inserted : - “ and includes parents who, though not dependent upon the earnings of the member at the time of his death are, . at : any time within five years after such death, without ndeqnate means of support.”
This, I think, will be accepted as a fair compromise. The Government have considered the matter, and are of opinion that there must be some finality.
– I think the proposal is a fair one.
.- This proposal opens the door to great possibilities.
– I think it is a fair compromise to protect the parents for five years.
– It would be a pity to overload our pension list. I believe in a liberal pension scheme for those who go to the front, but this seems rather a wide amendment, which will add greatly to our expenditure under the Bill and later on possibly render pensions unpopular.
Amendment agreed to.
Amendments (by Mr. Jensen) agreed to -
That the word “person,” line 12, be omitted with a view to insert in lieu thereof the word “member”; and that the word’illegitimate.” thrice occurring, be left out, with a view to insert in lieu thereof the word “ox-nuptial.”
– Has the AttorneyGeneral expressed any opinion as to whether “ ex-nuptial “ has the same legal meaning as the word “illegitimate”?
– Yes. I move -
That the words, line 25, “ Minister of State for Defence,” be left out with a view to insert in lieu thereof the words “Treasurer of . the Common weal th . “
This amendment will insure that all payments on account of defence pensions will go through the Treasury in the same way as the money now does in the case of oldage pensions.
Amendment agreed to.
Clause, as amended, agreed to.
Title agreed to.
Motion (by Mr. Jensen) proposed -
That the Bill be reported with amendments.
– I should like to move an amendment in clause 10, which provides that a pension to a widow shall cease upon her remarriage. Is not the Treasurer going to make this pension scheme at least as liberal as the Imperial pension scheme? The right honorable gentleman knows very well, for he has ascertained the fact, that under the Imperial scheme, if a widow remarries, she is entitled to a gratuity amounting to twelve mouths of the pension, and, further, in the event of her second husband dying, the pension reverts to her. Surely the right honorable gentleman is going to do as much for our soldiers and sailors?
-I can promise to have the matter reconsidered in another place.
Question resolved in the affirmative.
Bill reported with amendments.
– I now desire to move that clause 3 he recommitted.
– I submit that clause 10 ought also to be recommitted.
– I would assent to the recommittal of clause 10 if I thought there was not going tobe any long discussion. I cannot support the suggestion of the honorable member for Parramatta in regard to the pensions to widows, but I can promise to give the matter consideration.
Motion (by Mr. Jensen) agreed to -
That the Bill be recommitted for the reconsideration of clauses 3 and 10.
In Commit tee (Recommittal) :
Clause 3 -
Upon the death or incapacity of any member of the Forces . . . the Commonwealth shall, subject to this Act, be liable to pay to the member or his dependants, or both, as the case may be, pensions in accordance with this Act.
Provided that -
A claim for payment of a pension in accordance with this Act is made -
in case of the death of a member of the Forces - by a dependant not more than six months after the date of thepublic notification by the Minister in the Gazette of the death of the member; . . .
Amendment (by Mr. Jensen) agreed to-
That after the word “ member,” paragraph (1), the following words be inserted: - “ orby parents who, though not dependent upon the earnings of the member at the time of his death are, at any time within five years after such death, without adequate means of support, within five years after such death.”
Clause, as amended, agreed to.
Clause 10 -
A pension payable under this Act to the widow of a member of the Forces shall cease upon her remarriage.
– This clause should be amended so as to follow the lines, as far as possible, of the Imperial pensions scheme, under which a widow, on her remarriage, is given a gratuity equal to twelve months’ pension, and also has the right of pension kept alive for her in the event of the death of the second husband. We have to remember that all that happens to the good lady is the result of the death of her first husband, killed in battle. I desire to move a proviso to the clause.
– I hope that the honorable member will not persist with -his amendment. In any case, I do not think that he can properly move it, seeing that it adds to the expenditure in the Bill. However, I promise the honorable member to consider the matter.
– Then I shall have to leave it at that.
.- I hope the Government will adhere to the clause as it is, because the suggestion of the honorable member for Parramatta would result in rewarding persons who have not been to the war.
– It is not the intention of the Government at this juncture to accept any such amendment.
.- The honorable member for Robertson does not, I think, quite realize the purposeof the suggested amendment. The widow will not draw any pension while her’ second husband is alive, but, should he die, the pension will revert to her. It is a natural thing for a woman to remarry, and to do anything to prevent her is not only anti-social, but unjust. I strongly hope the suggested amendment will bo made in the Senate.
.- Apparently I have not made my position quite clear. To give a widow a gratuity in a lump sum equal to twelve months! of her pension is to place a premium on her marriage to some man who has not been at the war, but who will get the benefit of the pension granted in respect of the first husband, who was killed in battle. There is no question that, in tune cases out of ten, a husband participates in the goods of his wife.
– When civil servants die, gratuities are given to their widows.
– But not to their widows when they remarry.
– We are very miserable if we cannot afford to be as liberal as are “the Imperial authorities!
– If I am to be met with interjections of that kind, I shall have to take some time to make my position quite clear. When a widow remarries, she places herself in exactly the same position as that of a woman on her first marriage, to a man who does not go the war, and I cannot see any justice in the claim that, on her second marriage, siTe should have any benefit of the kind proposed. I hope our pension list will not be so overloaded as to become unpopular.
– That is a very absurd statement to make!
.- Without delaying this measure, I wish to repeat what I said last night, that when a soldier is killed, or dies at the front, his widow becomes entitled to a pension for the rest of her life. To deprive her of that pension on remarrying is to penalize her for entering into the most honorable contract she could make, a contract embodying probably the responsiblities of motherhood, and the production of children, which this country so much wants. I hope that the Government will be able to meet honorable members in this matter a little later.
Clause agreed to.
Bill reported with a further amendment.
Standing Orders suspended, and reports adopted.
Bill read a third time.
Debate resumed from 3rd December (vide page 1338), on motion by Mr. Fisher -
That this Bill be now read n second time.
.- I do not approach the consideration of this measure in any carping spirit, nor as one hostile to the Commonwealth Bank. The Bank having been established, it is the duty of the House to make it as powerful as we can, and by the exercire of our common wisdom to create in it a buttress to the credit of the country. 1 hope, therefore, that the Treasurer will take us into his confidence, and help us to help him to make the Bank worthy of the name of a National Bank. I believe that honorable members generally desire to make the Commonwealth Bank the strongest financial institution in the land. Banking is one of the powers directly delegated to this Parliament by the Constitution. An overwhelming majority has expressed approval of the establishment of a National Bank, the only disagreement being as to the constitution of the institution. ‘ To my mind, its present constitution, the Governor having unlimited power, is entirely opposed to the principle underlying the legislation of this Parliament, and opposed also to the best traditions of Democracy. It matters not how good the Governor of the Bank may be. lie cannot have that wide general knowledge of finance, of production, and of developmental enterprise which a Board appointed to help him in the carrying out of his duties would possess. Behind the ordinary financial operations of the Bank, the receipt of deposits, and the lending of money, is the great question of policy. That the Bank’s policy may be sound, those who direct ite operations must have a wide knowledge of the science of finance, and understand the commercial operations of the Commonwealth, internal and external, and the management and conversion of loans. The control of the Bank demands a greater knowledge and experience than can be possessed by any one man. If the manager be a successful banker, he will be largely a technical man, but will not have the wide knowledge of commerce that is necessary in dealing with questions of policy. We have now an opportunity to make the Bank a thoroughly national institution. We can make it the strongest institution in Australia, but to do so we must reconstruct it. In my opinion, the Bank should undertake the management of the public debts of the Commonwealth, and of the note issue. It should control the conversion of loans, and conduct the general banking business of the Governments of the Commonwealth and of the States, and of municipalities, perhaps. I hope that the Prime Minister will allow Parliament to assist him in reconstructing the Bank, to make it an institution which will invite the confidence of the commercial community. If the Prime Minister is amenable to reason, that can be done. In other parts of the world, where they have the most eminent financiers, it is in accordance with the best traditions of management that control should be exercised by the use of the corporate wisdom of a board of directors. No one will say that Parliament is not better able to legislate for the needs of the country than a dictator would be.
– I am willing to give honorable members an opportunity during this Parliament to deal with the whole question; but the Bill now under consideration is pressing.
– That assurance is hardly satisfactory, because one of the proposals contained in the Bill is to enormously increase the capital of the Bank.
– I shall prove that that is necessary.
– I do not object to the increasing of the Bank’s capital. A national bank needs as much capital as it is proposed to give to this Bank, and may need four or five times as much. The acquirement of another banking institution is a different matter. Parliament should have some “say” in that, as it had in the creation of the Bank.It should be able to criticise, and should be asked to approve any scheme that the Government may have. I do not know whether the Treasurer has in mind the taking over of some particular institution.
– No. I propose to submit the matter to. the Auditor-General, if the Opposition so desire.
– What would be his function?
– To examine the accounts of the institution which it was proposed to acquire, and to report on the proposal.
– He could look at the matter only from the point of view of the vouchers.
– He would make a purely auditorial . investigation. He would not inquire as to the value of securities.
– Yes. he would.
– That is foreign to his functions.
– He is not necessarily competent.
– There would be also the Governor of the Bank, the Assistant Governor, and any other experts that they might bring in.
– The AuditorGeneral, if instructed to investigate the affairs of the Bank, would see that the statement of its accounts was correctly presented, and that certain securities were held for advances made. But he would not value those securities so that
Parliament could know whether they weresound, and whether the advances made on them were safe.
– The Auditor-General is. not a qualified assessor.
– The Bank being a. public institution, Parliament should haveall the information necessary to judgewhether the purposes for which it was. created are being effected. I do not think honorable members generally areof opinion that one man should exercise the powers that the Governorpossesses, having the right to purchaseland, to build offices, and to act altogetherindependently. Parliament should be able to obtain information regarding the operations of the Bank ; I do not mean information as to its dealings with individual customers. The fullest information regarding the Bank’s operations could be supplied in the form of a report, without revealing the secrets of any individual account.
– What information hasbeen refused to the honorable member?
– A little while ago I asked to be informed of the number of accounts of, and the amounts advanced to, customers having overdrafts or loans of less than £2,000. To supply that information would not give away one single secret of the Bank.
– No private bank would supply it.
– But this is a public institution, and. I am surprised that there should be the slightest objection to a. question of that kind, or to giving the information desired. I have in my possession a manifesto issued by the Labourparty during the 1910 elections, and ins this manifesto the Commonwealth Bank: was put forward as a people’s bank, and it was stated that if only the Labour party were returned to power there would be no unemployment, and no more wivesworrying over money matters. The Commonwealth Bank was to supply the moneyneeds of Australia. It was said that the existing banks had made enormous profits-, out of the savings of the people, and that there was only one way to cure this, trouble, and that was the gradual extinction of existing institutions and the establishment of a national bank which would’ be the people’s bank, to which those whowished to get overdrafts, especially small?, overdrafts, could go. The Labour partysay that the Bank should be a people’s bank, and should help the small men of the community, and I am now desirous of ascertaining whether, under existing conditions, that object is being carried out, and whether tie small men of the community are receiving proper treatment from the institution. The Commonwealth Bank has drawn about £5,000,000 from the people in the shape of savings deposited with the Savings Bank branch ; hut we are not informed as to whether the people who have placed that, money on deposit, have the opportunity of drawing from the Commonwealth Bank any small portion of these savings. To expect that a banking institution, which is supposed to be a true people’s bank, would only lend out its money to small borrowers is unreasonable; but we know from the reports of the State Savings Banks that the great bulk of their money is lent to small borrowers to enable them to carry on small farms, or to build small homes for themselves, which is the pure purpose of a people’s bank. However, in this Parliament we have no control over the Commonwealth Bank to see that this object is attained. We do not know what the Bank is doing in that direction. I am aware that it has lent large sums of money to wealthy municipal corporations.
– I am glad to say that this has led to considerable employment, and will prove remunerative to the Bank.
– I know that there will be a sort of evanescent gain as long as the loan exists; but that temporary gain will be nothing in comparison with the building up of a small yeomanry, and a class of freeholders possessing their own homes, which, after all, is the proper purpose to which the savings of the people should be put.
– Do you object to municipalities being financed by the Commonwealth Bank?
– No. In every banking institution a certain percentage of the funds is held in Government bonds, and a certain percentage in Metropolitan Board of Works or municipal securities, and I do not object to that. My objection is that we have no means of ascertaining whether the Commonwealth Bank, which is supposed to be a people’s bank, is lending a reasonable proportion of the millions it holds to the people of the commu nity who would most benefit by the wider distribution of the money.
– Have you got that information from other banks ?
– The position of the Commonwealth Bank is different.
– The balance-sheet of the Commonwealth Bank is on the lines of the balance-sheet of other hanks.
– But it does not give us sufficient information. Parliament is the owner of the Bank, the creator of the Bank, and the only body that can criticise it. We are the shareholders of the Bank.
– And the only body responsible for it.
– Nearly every other bank has a board of directors elected by shareholders, to whom the bank directors are responsible, but in the case of a national bank, the position is quite different. Parliament, as the executive of the people, is the only board of directors which can adequately criticise the operations of the bank. Information as to individual loans should be kept absolutely secret, but the matter of the disposition of the money, the question of whether the savings of the people which are deposited in the hank are distributed in a way which will give the best return and the best service to the community, or being poured, as we believe, into wealthy corporations, is a matter for consideration in this Parliament, because if the latter course is adopted, the bank is not performing the function that was expected of it. The report of the Victorian Savings Bank Commissioners gives the fullest possible information. I am not going into particulars now, because I have an amendment tabled to which I shall speak later on, but the fullest particulars are given as to the number of loans in different districts and in the cities, and in particular counties, and as to the average amounts, those under £2,000 and those over £2,000.
– Would you be satisfied if you got that information from the Commonwealth Bank?
– One of. my objections would be removed, but I have other objections. I am sorry that the Treasurer has not seen fit to withdraw the savings bank provisions from the Commonwealth Bank Bill, and allow the States to assume control of the business. However, I shall not discuss that matter now. Seeing that the House is in the mood to make the Commonwealth Bank a thoroughly national bank, we should have the opportunity of learning how the Bank is conducting its business, and I regret that the Treasurer does not take us into his confidence, in order that we may, in our united wisdom, evolve a measure that we can all thoroughly approve of, and that the commercial community would approve of, and that will be in its essence a people’s bank, an institution that will stand behind the people of Australia and especially the commercial community.
– - I do not desire, like other honorable members, to delay the carrying of the Bill, but I do not like the basis of the Commonwealth Bank. At the Brisbane Conference a resolution was carried to establish a bank that was to be a bank of reserve, and a bank of issue. The existing Bank is neither a bank of reserve nor a bank of issue. Another thing that I do not like about the institution is that we are to go into the market to borrow capital for it. All my life I have held the idea that the curse of the masses is the paying of interest, and it has been rny idea that the interest-bearing power of capital is gradually transferring the wealth of the world every sixteen years into the hands of the wealthy classes. When I first drafted a scheme for the Commonwealth Bank and took it to the Brisbane Conference, I proposed that we should have in Australia an institution that would enable us to so mobilize our instruments of exchange and credit that we , would be able to utilize the collective’ wealth of the nation for the benefit of the individual. That was the idea the Prime Minister had in view. At the Brisbane Conference on the 6th July, 190S, Mr. Holman said -
A bank jointly owned by the Commonwealth and States as set out by Mr. King O’Malley might form a happy solution of the difficulty.
Mr. Watson said ;
He was in agreement with the principle of Mr. King O’Malley’s scheme for a Commonwealth Bank. and Mr. McGowen, who was afterwards Premier of New South Wales, said -
He felt that the Labour movement was under a lasting debt of gratitude to Mr. King O’Malley for the great trouble he had taken in this matter. For thirty years he had been advocating a national bank, and Mr. O’Malloy had put the machinery and operations of it in a concrete form.
The Commonwealth Bank should not be a party machine. I have always thought that there should be a Committee from all sides of the House, comprising men who have devoted some attention to these questions, and that out of that Committee we should be able to devise a scheme, not for party success, but for the benefit of the whole of Australia. If I were asked whether I would prefer to have a shareholder’s bank - that is, an issue of 1,000,000 shares at ?10 a share, to he sold to the people of Australia or to the people of the world, but on which no interest was guaranteed - I would say that I would infinitely prefer to adopt that course than to accept the proposal to give the Governor of the Bank the power to go into the markets and borrow ?10,000,000. The moment thatwe issue the shares the Government will run the Bank the same as Germany does the Reichs Bank. Germany does not own the Reichs Bank, but the Government operates it, and controls it, and appoints the directors. What I wish to point out is that if that hank does not pay, the shareholders lose, whereas the moment we go into the world’s markets and borrow ?10,000,000 as capital for our Bank even at the rates at which the Prime Minister got his war loan - close on 4 per cent., even though it is a sympathetic loan - the Australian taxpayers for all time are pledged to ?400,000 a year, which must first be earned, and which is a tax on Australian taxpayers and a mortgage on producers, before the Bank can lend one penny. How are we going to reduce the rates of interest as the Labour party have always advocated if we start by guaranteeing our capital at not less than 4 per cent? The capital of a national bank is the note issue ; its foundation is its power to issue credit money. If we desire now to make this a great bank, and to put ourselves beyond the necessity of begging people to lend us money, we have the wealth here to our hand. It is true that Australia owes publicly and privately about ?700,000,000. but, according to Knibbs, an approximate estimate of the value of Australia is ?1,000.000,000. That leaves a balance of ?300,000,000. Why cannot we utilize that balance and that ?700,000,000 worth of debt for ourselves? We are not doing it. The annual surplus wealth of the world that is available for new investments is only £800,000,000 sterling. If it is costing Great Britain £8,000,000 a week for war, and other nations are spending in the same proportion, we are absolutely bonding the investment capital of the world for four years ahead. We should start now and take advantage of our opportunities while we are establishing, this Bank to make it, not a boodleiers’ bank, but a great financial bulwark. I cannot see why the Opposition are opposed to the Bank in its present form. It is the safest Bank iu the world to-day for the capitalists. The note issue is guaranteed by the nation, and so are the deposits. Outside of Oklahama, it is the only bank in the world that I know of in which the deposits are guaranteed. They are not guaranteed by tlie Bank of England or the Bank of France, although the note issue is guaranteed by the Government. What I have always had in mind is a credit bank for the nation. Is this a democratic bank? A public bank that belongs to the people ought to be governed by the people. I have the profoundest confidence in the ability of the present Governor, Mr. Denison Miller. I regard him as a wonderful banker, and the advantage he has is that he has travelled about the world, and has returned with large and expansive ideas. Therefore, anything I may say about autocracy, or czardom, or sultanic power, will not apply to him. At the Brisbane Conference one of the resolutions was that the Treasurer should be entitled to attend all meetings and all proceedings of the Board of Management. Tlie Treasurer of the Commonwealth does not and cannot attend those meetings.
– He cannot give us any information.
– That is not true.
– The Treasurer could not give us information last session.
– I was not in office last session.
– I c I claim that the Treasurer should not be asking anybody for information. The Treasurer of a nation is a man in whom everybody has confidence. He is a public target. The limelight of the whole world is focussed on him, and, consequently, whether one is for the Treasurer’s party or against it, he has confidence in him. My point is that the Treasurer ought to sit on the Board of Management, taking no part in the proceedings, but seeing what was taking place. Another resolution was -
That the bank shall provide for temporary advances by way of overdraft to Commonwealth and State Governments and municipal bodies.
That the bank shall, in other respects, carry on an ordinary banking business, receiving for the public moneys on current account or fixed deposit, and making advances on good security.
The Bank is doing that. All the Labour Governments of Australia were sympathetic towards the Bank, but none of them has come in and taken a partnership, because, no matter whether one belongs to the Labour party or not, he recognises that there ought to be no taxation without representation. It is of no use to think that the Federal authority of a nation can override the ideas of tha States. The quicker we get out of our minds the idea that any part of a nation is above any other part, the better for us all as Australians. In fact, having regard to my American experience, I would be grieved to ever see the States wiped out. Sometimes the States have a centripetal power, and the nation a centrifugal power. Sometimes tie powers are reversed, but the one is always balancing the other, and the result is that the nation gets great ideas from the States. For many years the United States of America was one of the most Conservative nations on earth. It was useless to go to Washington to attempt to make any changes, but the States of Wisconsin and Kansas kept plugging away and making great reforms. Then a man like Theodore Roosevelt came along, and adopted ideas which have been put into practice in Wisconsin and Kansas, and thus great reforms were introduced into the Federal arena. So it will be in Australia. If we have Federation in Australian politics, is it not possible to have Federation in finance ? How are we going to get it? I hold that this Bank ought to be a bank of reserve, just as the Bank of England is. The Bank of England is a bank of reserve for all the other banks; it keeps their gold reserves, and ou its ledger they have only a credit. The British nation keeps its money and credit in the Bank of England, and why should the Australian Treasurer, whether he be Mr. Fisher, Mr. Cook, or Sir John Forrest, have to worry himself about finance?
With the exception of the policy, the whole matter ought to be delegated to the National Bank. The Bank of England does the whole business of Great Britain, and yet it is only a privately-owned bank.
– Does the Prime Minister sit on the Board?
– Would the honorable member nationalize the other asset he mentioned - the brains of Australia?
– We We have that already.
– In this House ?
– No; No; all the brains of Australia are not here, but we have a proportion of them. My experience is that, in Parliament, everything is a compromise. We never carry out a specific proposal as a man does in business. I have little respect for the business methods of government. I do not glow over it. If you see a wrong in private business you get rid of it. If you see a wrong in connexion with a public matter you have a great debate in Parliament. One man says that it is a wrong; another, that it is not; and in the end you compromise and keep half the wrong. In my original scheme I proposed that the Commonwealth Bank should be absolutely free of politics. I can see now, however, that that part of it which relates to the States cannot be kept free from politics. Australia is a nation of borrowers - a nation of indebtedness. You cannot get rich unless you get started in debt, but I do not like debts. Extravagance and its step-children, poverty and indebtedness, sap the life of a nation. There is no question about that. The nation that has its surplus capital invested in theindustrial organization of another country generally runs that country. That iswhy Great Britain, with its loans to the world amounting to £4,000,000,000,000, is the world’s banker. America has morewealth than that of the British Empire, Germany and France put together, and yet she has had to close her doors tobusiness in the present crisis, because shehas been anti-socialistic, and has refused to have a national bank. She has preferred to rest on private enterprise. Private enterprise is splendid until you meet, trouble. As soon as trouble comes, in this respect you want the nation behind” you, so that you may have some greatforce to apply. The trouble with America is that she has never had her national finances organized or mobilized. She has had 27,000 little banks carryingon the business of the country. Shehas never been able to say, “ We want so much capital for the nation.” But she is now starting to realize her trueposition. Sir George Paish, the editor of the London Statist, was sent to theUnited States lately by Lloyd George, the great Chancellor of the Exchequer of the United Kingdom, to enter into anarrangement with the Government, if possible, with regard to the gold reserve. The result of his visit was that arrangements were made that, instead of shipping gold to England or to Canada, America is to ship so many thousand bales of cotton, which will be charged up in America, and made the subject of crossentries. Arrangements have been made so that the gold will not have to leave the United States. While there I often noticed kegs of gold passing backwards and forwards between England and America. We often shipped gold to England, but upon its reaching London the rates of exchange had altered, with the result that it came back to America in the same ship. And so with Australia. I urge the Prime Minister to get into communication with the Treasurers of the world, other than those of tlie countries with which we are quarrelling just now, and to try to create a great international gold-clearing house. It is strange that such an institution has not already been established. If we had a great international gold-clearing house in the capitals of all the countries with which we arrived at an agreement we should have safe depositories. We should have international certificates of exchange, and instead of shipping gold from Australia we should keep it in the Commonwealth Bank or in the Treasury, and issue these certificates against it. The treasure would be divided in the ratio of the gold to the countries in the ring. Balances would be settled at specified periods. Every one knows that we do not send away our currency to pay foreign debts. If we are trading with Europe, America, or South America, and there is a balance against us, we pay interest on the balance until we can send a shipload of the various kind of commodities required, when we get the bills and cancel the debt. Seeing that we have been able to get rid of tlie stage coach and to substitute the telephone for the message boy, is it not possible for us to create a great international gold-clearing house ? Canada, Australia, America, and Great Britain are practically the only countries producing gold iii any quantity. Why was Germany able to victimize a lot of Bradford merchants after the outbreak of war? If we had had an international gold-clearing house she could not have done so. To me the failure to establish such an institution shows a want of business foresight. Let me come now to another point. It is wise always to go to the Scriptures for enlightenment. Our Saviour tells us of the wise man who builded his house upon a rock, and of the foolish man who builded his house on the saud. When the rains descended and tlie winds blew, and the floods came, the wise man’s house failed not, but as to the foolish man’s house great was the fall thereof. Is this noi a perfect illustration emphasizing the point I have been trying to make regarding the creation of a great Australian national superstructure of finance ? This superstructure should be broad-based ; it should rest on a bank in which the Australian people have confidence rather than upon the sandy foundations of private capital. When the war broke out I was told by a lady from England that the people there could not raise a dollar, because the banks stopped payment for a week. But for the British Government guaranteeing the Bank of England, which has in turn guaranteed the credit of the world, we should have had one of the greatest financial disasters since 1857. I do not regard gold as all important.; but I find the Australian people are mad on the point; and when that is so, it is best to let them think what they like, so long as you can get them to come your way by some other means. Money, whether in gold, silver, or paper, has very little wealth in it; its value consists in the fact that it is made a legal lien on all property for sale. The difference between a private promissory note or a mortgage and money is that either of the two former has relation to a specific piece of property, while the money is a lien over all property, whether owned by the Government or private individuals. Gold is no more than paper in our pockets, though everybody seems to think that it is something more. England to-day is the banker of the world, and yet the total gold of England is £70,000”,000.
– It is only seven years ago that the Bank of England had to fall back on the Bank of France for gold.
– T - The Bank of France is the biggest bank in the world. There is another point I wish to emphasize. I ask the Treasurer whether he knows any bank in the world run by one man?
– There is quite a number.
– I d I do not know any national bank that is run by one man. To start with, it is not fair to the Governor of the Bank. There is a famous Kaffir proverb to the effect that he who will not profit by the experience of the past, gets knowledge when trouble overtakes him. Is there a bank - a national bank, and not a private bank, because many private banks are run by one man-
– And big ones, too!
– What about the Rothschilds?
– In In the case of the Rothschilds there is a big family Board of nine. The weekly balance of the State is between £5,000,000 and £6,000,000, though it may be £7,000,000 for all I know. At any rate, at the time I was dealing with the question it was £5,000.000 or £6,000,000.
– It is not so much now.
– It is much more than that if we count the fixed deposits in the Savings Banks.
– That is not the sense in which the word “ balance “ is being used.
. - Every one knows that connected with a bank is an actuary; and if for three months there is a certain balance, which has a tendency to increase, the banker can lend £7 for every £1 of credit balance. This in America we used to call fictitious capital. We must be sure, however, that there is a balance which has a tendency to increase. What does a bank rest on ? Confidence. What is confidence? The reflex of the existing economic conditions. We never yet had a great financial disaster in the world through lack of money, lack of employment, or lack of food. Our great financial disasters have all come through lack of confidence and lack of credit. Yet 95 per cent, of the world’s business is done on credit, and only 5 per cent, with capital, and that 5 per cent, is nearly all credit, because of the fact that before you pay, you have to send it home and “ have a look at it.” That, again, is trust. Where does all this capital come from which absorbs our securities? It comes from various sources - from savings banks, though only from that portion of the savings banks money which does not represent the expansion of credit, but the absolute savings of the masses - it comes from the surplus earnings of banking corporations, who can withdraw that surplus from their business without interfering with the business.
– But they keep it as reserve.
– The They may; I know that in America we used to invest a lot of it, and keep some as reserve. The capital comes from fire and life assurance companies and their earnings, and from charitable, benevolent, and educational associations; it comes from retired business men and others who have transferred their business to trustees, who, in turn, with a desire to put their business on a better footing, take chances. Then, again, capital comes from the securities which the banks maintain for the purpose of being able to turn them into liquid assets immediately if wanted. But what is the trouble in Australia ? It is that we have not a re-discount bank. And so all these banks, even our own Bank, have money on call. What does “ on call “ mean ? It means Stock Exchange collateral securities; and while millions of pounds are withdrawn from production and the distribution of commodities in Australia, and placed on call in London, very often the small business men in Australia cannot find sufficient currencv to meet their maturing obligations. If the Commonwealth Bank is not going to lend money to small people - if itis not going to go to the rescue of the little under-the-hundred -pounds-man - then I cannot see of what earthly use it is, so far as the working masses of Australia are concerned. As a boy in a bank in America, I saw how enormous wealth drifted into the hands of the few; it was said, “Go to sleep, my boy, if you have boodle ‘ out at interest ; you can get rich while the fellow who pays the interest often gets poor.” I saw all this, and I said, “ We must reduce the interest.” I have tried to find out, but I do not know what the average interest is in Australia. When I was in business in New South Wales there was one claim that came under my notice. I do not wish to publicly state the name of either the individual or the bank, but I shall be prepared to do so privately if necessary. Eighteen years before, £100 had been borrowed from a banking corporation, and when the settlement came we found that there was still £500 owing, £400 being for interest.
– It must have been a Mont de Piete bank.
– It It was not a Mont de Prete bank. And when we work this out, the interest is not excessive. The £10,000,000 at 4 per cent, will double itself in eighteen years, and at 41/2 per cent, in sixteen years; so that if we borrow it at 4 per cent, we shall in eighteen years have paid £10,000,000 in interest, and still owe the £10,000,000.
– That is an argument against interest.
– I - I admit that. What is the capital of every national bank ? Its note issue. And that note issue is the reserve - the one thing that the bank can fall back on. The note issue is the bank’s capital. I think Mr. Denison Miller has done wonders. Are we starting out to make big profits from this Bank straight away ? I say we ought not to do so. We ought not to care if the Bank does not earn a penny for ten years, so long as it pays its way, and saves the Australian producers and distributers millions of money. Supposing that we could reduce the interest on £700,000,000 by 1 per cent. - which is very small - it would mean that the Australian producers and distributers would save £7,000,000 worth of their products every year. It means that we should enable Australian producers to transfer the £7,000,000 that now goes in interest, into their banking accounts. I often hear my Australian friend say, “ Oh, let us borrow; it is charging it up to the next generation.” A nation going into debt is like a man going into debt. It does not mean that we are to borrow from future generations, but it does mean the monopolizing of the capital of the masses in the hands of the few. Whenever a nation builds a great public work by incurring a public debt, it does not mean that we are leaving the paying to the future, but it means that the vast masses of the people are too poor to own their share of the enterprise, and their earnings are obligated to the wealthy classes. The wealth of a nation ought not to be in money, but in products and business of all kinds, and the rate of interest ought to be low. Financial conditions ought to be made easy for a poor man - tlie small man. I had great ideas about the Commonwealth Bank at one time, but I have lost all hope now. I can never forget how Mr. Chris. Watson, when one day I was talking in Caucus about banking, said to me, “ Look here, O’Malley, if we were all bankers we would not be working men; what are you talking about?” ‘ Watson was a long-headed man, and he was quite right. The Bank of England, the world’s bank, is not nearly so strong as the Bank of France. The greatness of a nation does not lie in the fact that that nation possesses enormous wealth; it lies in the mobilization of that wealth. General Lee used to lick Grant with his millions of men because, while Grant would be going round the corner, Lee would switch across. If our Bank were properly organized, and the States were partners, it would lend the Australian producers £60,000,000 of credit a year, and never put out a sovereign. If I, as a private individual, have £10 000 to lend out, the moment the last of tlie capital is gone my operations must stop. But were I to put up the sign “ King O’Malley. Boyd, and Watt, bankers,” entering into articles of association and complying with the Companies Acts, and simply exercising the banking function, the £10,000 could be put into* a safe, and a couple of million pounds could be lent out, supposing the people to have confidence in the concern. Every night we should have more in the bank than the £10,000 we started with. Why? The accounts would be balanced daily. We should put Murphy against Sullivan and some one against some one else, .and with a credit on one side of the ledger and a debit on the other, we should pay the difference with a sight draft on the bank of exchange. The great trouble is to balance or to clear. There is no royal road to finance. A bank is simply a clearing house for producers and traders, a dealer in debts, and a generator’ of credit. Pick up the balance-sheet of any bank, and you will see that there is a capital of about £2,000,000, and deposits amounting to £20,000,000. The deposits are credit. Were I to go into a bank, and say, “ I want £10,000,” the’ moment I got the money, supposing my security to be satisfactory, I should increase the bank’s loans by the amount of the bank’s advance to me; and were I to place the money to my current account, I should increase the bank’s deposits by the same sum. Thus I would increase the bank’s loans and the bank’s deposits at one transaction, putting no boodle in and taking none out. This exemplifies the power of credit. At the end of this month, the banks will begin to issue their balance-sheets, and we shall learn that the deposits in Australia increased last year by so many millions. That only means that the producers and traders increased their indebtedness, which has been exchanged for the fortified credit of the banks, thus increasing the banks’ debts. Many years ago I heard the ex-Treasurer of a State say, in the course of a financial speech delivered in this Chamber, that the deposits of Australia were £180,000,000. “Fancy that,” he said, “£180,000,000 in cash !” I did not like to hurt his feelings by saying anything at tlie time, but when he sat down I told him that there was only £24,000,000 in cash, the rest being merely credit. “Never!” he exclaimed. “That is so,” I replied; “ come to me for instruction before you speak again.” Every big man that Australia produces is a big advertisement for the country. It is its big men that give a nation its standing. What would America have done without Washington, Jefferson, and Jackson’!
– And Hamilton.
– I - I look on -Hamilton as tlie greatest of them all, just as Marshall was the greatest Judge. We do not wish to hurt the feelings of big men, and I did not wish to hurt the feelings of the ex-Treasurer to whom I referred. It is always easy to whisper. When Charles Stewart Parnell was a member of the House of Commons, he never hurt a fellow member’s feelings. Often when he had been abused he saw Ti is fellow member later, and said to him, “ Brother, you have made a mistake; the facts are so and so;” and the interview would end with an apology. The Bank of England has almost the sole right of note issue. In 1844 it had an issue against securities amounting to £18,450,000. Beyond this it could issue only against coin and bullion. The other banks which were issuing notes in 1844 were allowed to retain the privilege of issue, but that privilege was not accorded to new banks. The Bank of England has a large board of directors, chosen from among the leading financiers of London. Its Governor is appointed for two years only. He is not a banker, but a great business man. Many years ago, the Governor of the Bank of England told a relative of mine that America could run a great national bank without any gold whatever, if she were to use a private bank for foreign exchange business. But America was not taking any. My relative was a banker, and he did not like that talk. You never like giving up a privilege. There are at least twenty-four directors of tlie Bank of England, possibly more. The capital of the Bank of France is only £7,300,000, and the bank pays duty to the State on that portion of its note issue not covered by specie. In 1913 the average circulation was £226,000,000, of which £158,000,000, or about 70 percent., was covered by specie. On 13th July, 1914, the note issue was £267,000,000 and the cash reserves £190,667,000. There is a legal maximum which in 1912 was raised from £232,000,000 to £272,000,000. Although Germany is now engaged in a great war, she has increased her gold of late. According to the latest papers that I have received from America, she has increased her gold by something like 40.000,000 dollars.
– That is not much. All the banks have increased their gold.
– It It is a big increase for a country that is fighting several other countries. Every one remembers the closing of the Australian banks in 1893. The trouble was caused by the absence of a central authority to which they could take their securities and rediscount them. That is the weakness of Australian finance. If all the banks kept their reserves in the - Commonwealth Bank, there would never be a run on them. The moment the Australian banks are called on to reduce their loans, they must increase their cash, and they cannot immediately convert. Why ? Because there is no bank of rediscount. The honorable member for Flinders spoke the other day. about the danger of the depreciation of the currency proposed by the Treasurer. That is what we term, in America, an inflation of the currency. No one can point to a country in which a convertible currency has depreciated.
– I did not suggest that that is possible. I was pointing out that the conditions tended to inconvertibility.
– Tha That has never been discussed here, in the headquarters of the Lord’s Army. A note issue that is quickly convertible on demand, and with the instruments of redemption on hand, never depreciates in value if the nation’s monetary basis is sound.
– There is no depreciation so long as a note currency is readily convertible.
– I w I wish to make that clear, because people outside, who have not studied the money question, have been scared.
– With good reason, because there has been loose talking.
– T - The trouble with a note issue arises when a nation allows its monetary standard of value to be debased. Then’ the note issue comes down. It is far easier to criticise financial propositions than to suggest a remedy for what is wrong. It is easy for me to criticise, because I know the ins and the outs of the game. Financial hard.upishness is the disease from which the
Australian Treasurers suffer severely every year.
– And others, too.
– I - I admit it.
– The honorable member’s time has expired.
Mr.Fisher. - By leave, I would move that the honorable member be granted an extension of time.
– The proceeding is altogether irregular, because the House has decided, by passing a certain standing order, that speeches shall not exceed a certain length. However, as it appears to be the desire of honorable members that the honorable member for Darwin shall be allowed to continue, I shall not interfere.
– Mos Most of our Treasurers have this disease in a chronic form, and I sympathize with them. The Labour party’s idea in regard to the Commonwealth Bank was that its business would be to inscribe stock, to float loans, and to meet and keep track of the great investors in London. It is many years since I was in London. When I was there last, I discovered that the States dealt with the Bank of England or the Westminster Bank, and that that meant good business for the bankers who deal with the trustees of these great sums awaiting investment, and when loans fall due take the money and pay the investors, but never tell the borrowers whom they are really dealing with. If a loan has to be renewed, the banks say that if the borrower will only advance another11/2 per cent., the investors will be prepared to do business. On one occasion when I was dealing with a Canadian loan, the broker said to me, “ Wait ; they are going to put up the interest by1/2 per cent.” They can bull-doze the State Treasurers, because these gentlemen are not anxious to see their loans fail. This is the business in a nutshell: We cable to London, the banker in London floats the loan, we give him our stock, he puts it out, and out of £10,000,000 I suppose we get £9,000,000, the rest being absorbed in underwriting, bank commission, brokerage, banks’ stamps, exchange, and everything.
– The cost is not so much as that. It runs to about 21/2 per cent, on an ordinaryflotation.
– I was astonished to hear the honorable member say that last night.
– That is the average cost.
– Eve Even assuming that it is 21/2 per cent., on top of all these charges we only get £95 or £96 instead of £100.
– I gave the State of Victoria £98 without charging a penny.
– If If the Treasurer had listened to me, the States would have paid the Commonwealth Bank for the underwriting and brokerage, and everything else, and the Bank would have made a profit; but the right honorable gentleman, with his high spirit of honour, said, “No, the States must be on the same level as ourselves.” The result wasthat the States got this money without paying a penny for brokerage, and the Commonwealth Bank shows a deficit. Yet our friends on the other side are howling out against it. If the Treasurer had listened to me, he would have secured a couple of hundred thousand out of the States, which they would have paid without protest, if they had listened to the advice of Mr. Boodle. The Commonwealth Bank should have the power of issuing; it should be a bank of reserve, and a bank of issue; it should be a reserve bank for all the other banks, and that should be its capital. I hope that the Treasurer at this late moment will not allow the Commonwealth Bank to go out into the world and get heavily into debt at its inception. I wish to place these figures before the House. The gold reserves in the different countries, in ratio to the total currency, are as follows: - United States of America. 49.9 per cent.; Great Britain, 70.0 per cent.; France, 62.12 per cent.; Germany, 66.10 per cent.; Russia, 87.71 per cent.; Austria-Hungary, 66.9 per cent. In all these countries the combined gold, in ratio to the total circulation, is 69.6 per cent. In regard to loans, every one knows that the London banks simply wire out a credit to an Australian bank and the latter starts to pay out with Australian sovereigns. Not a sou comes out to Australia. When I was connected with a mill, we simply wired down a credit to the local banker, and the latter paid everything. Why should we not organize so as to have the debt in our own hands, and pay the interest to ourselves? Why should we not go into debt to ourselves? Why should not the municipalities and back-blocks shires be able to go to the national Bank and say, “We want a credit. We have taxable property.” Why should not any of these various institutions in times like these be able to <lo this ; and why should not men be paid on Saturday with cheques on the Bank, which cheques the men give to the tradespeople, and the tradespeople in turn put in the Bank, the Bank on the next Saturday paying them out again to the men, and so on, each Saturday the men being paid with the same “ boodle “ ? There is no mystery about it. I have noticed since I have come to Australia that the rates of interest are not created by the demand for capital for legitimate enterprises, bub are created by the demand for capital for call loans in Loudon, New York, Paris, or Berlin. What does that mean ? If we take up a balance-sheet we see the millions sent away from Australia. The Germans go over to London, hypothecate their securities, and get Australian gold, with which to build their Dreadnoughts. My desire is to see a system created that will keep that money here - for it can be done - and by which we will pay the interest to ourselves. If we had tlie finances of Australia properly organized, no man need be out of work here.
– Do you assume that there is a. large unabsorbed internal credit in Australia?
– It It is all a matter of how we finance the thing. Is not Australia a gold-producing nation ? Is it not a. wheat-producing nation ? If we go back for thirty years, we see that we have sent away every year from £6,000,000 to £10,000,000 worth of products more than we ‘have brought in.
– We are still a debtor nation.
– I a I admit it, and for that reason we need a bank like the Bank of France. This is where I wish to read what an American banker has said about the Bank of France -
But :It thu bottom of the whole fabric of French finance, so Democratic in its character, and, in the commercial and industrial sense, exhibiting so largely an unsolicited fiduciary character, stands the Bunk of France itself, the very essence of the spirit of which we have spoken.’ This bank, by all odds the most powerful in the world, and at the same time the most directly subservient to popular necessities, has never, even in the times of war or revolution, refused to administer to the honest requirements of the community, and yet, in spite of its liberality, its losses are always insignificant, never having risen as high as the one-hundredth part of 1 per cent, of its operations, and being, of course, wholly lost to sight in the immense volume of its profits.
The source of its security lies always in the unbounded aid given by it to legitimate business, and in the confidence it thus inspires, being in the last analysis, and in virtue of its Aviso generosity, its own clearing house, and so being permitted to offset its obligations against its resources by the simplest processes of* bookkeeping, without inconvenient dispersion of funds, In the same way in which the Credit Foncier has made itself a voluntary trustee for the long time operations of the country, the Bank of France has, on its side, made itself a like trustee for the rapid operations of modern commerce, securing directly or indirectly to every worthy trader, however humble, constant and liberal credit, by encouraging the habit of replacing open accounts by acceptances, and thus making each man’s bill-case, instead of his lodger; the stronghold of his business. It demands at least two names on every commercial bill, so as to secure the record of a legitimate transaction, but it will discount any good bill that is not less than 40f. (£1 10s.), and does, as a matter of fact, discount each day in the year among the numberless trading documents which pass through its hands, from 20,000 to 30,000 inland bills of exchange, of which not one exceeds in amount lOOf., or £4. As to loans upon securities, where, of course, a single name suffices, it will accept any collateral that is essentially solid, whether it represents bonds «f the American States, stocks of the City of New York, Australian State debentures, obligations of a bank in China, the consols of England or Russia, or the rentes of France. It wishes to give to every Frenchman, so far as wisdom may permit, the facilities necessary for the prosecution of any legitimate business at home or abroad, and to do this in a manner affording the utmost ease, consistent with ordinary prudence.
These other French financial institutions know that in their hour of need, they can, Avith thu certainty of prompt response, apply to the Bank of Franco for any relief that they may require, and that the bank itself is safe in granting such relief. But it is not alone its £150,000,000 of metallic reserve, coupled Avith other resources just as boundless in their way, which give to the Bank of France its wonderful strength. Important as the case and securities are in the estimate of its influence, the secret of its power lies in the fact that it has made itself the trustee of the nation’s credit-
Why should not our bank be the trustee of the credit of the Australian nation? And how will this Bank become the trustee? By having everybody working in harmony with it, so that the Governor will not have to carry that great weight alone. It is a tremendous responsibility for one man. No matter- how insignificant any man sitting at a Board may be, he has a little thought, and he says, “ I will think over this matter till tomorrow.” And next day the members of the Board talk it over again. Thus the representatives of the States could put constantly before the Governor the requirements of the States and the municipalities. That American writer continues! - and that, by perfecting a system which secures instant accommodation on any scale, however large, however small, for every transaction of industry, commerce, or finance, it has become the reservoir of the nation’s wealth, and the adjuster of the nation’s accounts, rarely making, or being expected to make, any other output of cash than that which the small change of the daily life of a great and energetic people necessitates.
Wo have much to learn from France, and trust that we are disposed to profit by opportunities which young and vigorous peoples temporarily raised above the necessity of class economy are somewhat prone to believe their own judgment.
In conclusion, I desire to say that, though I believe in taking over other banks, at the present time I am very much afraid, because of the extent to which the securities are dropping. Values are tumbling over themselves, and we do not know what may happen if this war lasts for any great length of time. I do think that there ought to be appointed a Committee of this House that could be absolutely trusted to, in conjunction with the Treasurer, look into the securities before the Commonwealth Rank takes them over. A private bank never desires another party to take over its securities while everything is progressing well. I would not like to see this Bank make a mistake.
– - Whatever ideas I might have had on such a subject’ as finance before the honorable member for Darwin spoke had vanished into thin air by the time I had heard the whole of his speech. The honorable member uttered such a whirl of ideas, some of them brilliant, and others irrelevant, that I was almost entirely deprived of the power of thinking on the subject at all.
– And they were all very happily put.
– They were. The picture which- the honorable member painted of myself, the honorable member for Henty, and the honorable member for Balaclava, sitting on a golden cloud, like financial archangels, and dispensing the blessings of unlimited credit to a grateful world, while incidentally enriching ourselves, was one that will live long in the memory of the persons chiefly represented in it. I quite realize that at this stage anything we, on this side, may have to say on this very important subject is, comparatively speaking, without effect. I regard this measure as one of the most important which has been brought forward this session, because it seems to me to mark, more definitely than anything else that has taken place in the history of the Bank, the parting of the ways in the future development of the institution. I have always looked upon the Commonwealth Bank, from the time it was started, as an institution which should perform functions which are as far apart as they possibly can be” from those which it wil be invited to perform if the Bill is passed and acted upon. I have thought that it should be a national institution, backed by the whole credit of the nation, that ifr should act as banker for the Commonwealth, banker for the States, and banker for Government institutions, municipal and other, that it should manage and control the great public financial arrangement which have to be made in connexion with all our loans, and have the supreme responsibility of guiding, directing and controlling the note-issue. Those are the main functions which, I believe, would be not only safest, but also most beneficial for this Bank to exercise. But what is it proposed that the Bank shall do ? One sentiment emanated from the honorable member for Darwin that I agree with so cordially that I propose to ask the House to give effect to it by carrying an amendment I shall move to the motion for the second reading. The honorable member said that this was a time when, without consideration of party, in dealing with a great national institution, the Government might fairly ask the House to debate- how this Bank is to be moulded for all time, and when the Government might treat not altogether with contempt, but rather with some degree of consideration, the experience which honorable members on both sides of the House have in connexion with these matters. That would be an infinitely wiser course to adopt at the present time than proposing to invest the Bank with a power which the Prime Minister says is not necessary to be exercised immediately. Tn reply to an interjection from this side of the House, the Prime Minister said that he had no transaction of this nature in mind.
– I was glad to hear that.
– Were you in doubt?
– I was, because I could not, on any other basis, understand why, in the circumstances now existing, the passage of this important measure was being made by the Government a matter of extreme urgency. If the Prime Minister has no such transaction in view, why, in Heaven’s name, can we not have even a few months’ consideration of tlie lines on which the Commonwealth Bank is to be developed ? Are the Government going to exclude entirely from the consideration of this allimportant question all those who do not happen to be members of the existing Cabinet, or to have been taken into their confidence ? I desire to indicate what seems to me to be the track on which we are invited to tread. We are invited to authorize the Commonwealth Bank to enter into the purchase of any of the trading banks. That power can only be effectual by the Commonwealth purchasing a bank which is not in a position to profitably carry on its own business. The only way in which the Commonwealth can carry out that power is to make the National Bank nothing better than a sort of assets realization concern. I was amazed when I heard, in reply to criticisms from this side of the House that such a power vested in the Governor of the Bank could not be securely carried out, because the control of the Bank was in the hands of only one man, the Prime Minister’s remark that the Bank would have the assistance of the AuditorGeneral in connexion with such a transaction. Such a remark seems to show that the Prime Minister has really not had the nature of this transaction fully under consideration.
– The assistance of the Auditor-General was suggested by the Opposition.
– I do not care from whom the suggestion came; that it should have been entertained by the Prime Minister is amazing. The duty of the Auditor-General is to deal with accounts and vouchers, and to see that those things which appear on paper are represented by something that actually exists. It is not his duty to value securities, or to do what in this case would be the most difficult of all the preliminaries of the purchase, viz., to enter into a minute investigation of the transactions and business credit of the institution to be taken over. That is what the Bill proposes may be done by the Governor of the Bank, against whom I know nothing except that Mr. Miller has never had experience of dealing with such vast issues as those now placed in his hands.
– Has any man on earth had that experience?
– There is no man on earth whom a prudent Parliament would invest with the enormous powers that we are asked in this Bill to give the Governor. We will never set this institution on a proper basis until we recast the whole management and create a governing body, consisting of men who are experienced, and who will be able to deal with these matters. The Prime Minister has already admitted that there is no transaction immediately in view.
– I have admitted nothing. I say there is no such transaction.
– I withdraw the word “ admitted; “ it was not meant to be offensive. The Prime Minister has said that there is no transaction in contemplation. I say that, in all prudence and common sense, our proper course is to take more time for the consideration of the incidental consequences of the course we are asked to follow. In order to give an opportunity to members on both sides of the House to consider whether that procedure is not a wise and prudent one to adopt, I move, as an amendment to the motion for the second reading -
That all the words after the word “That” be omitted with a view to insert in lieu thereof the following words : - “ The questions of (a) the control and development of the Commonwealth Bank; (b) the transfer to the Bank of the management of the note issue; and (c) the relations of the Bank to State and other financial institutions, be referred to a SelectCommittee of this House for consideration ann report.’
Sitting suspended from 6.S0 to 8 p.m.
Mr. JOSEPH COOK (Parramata[8.0] . - I am in thorough, accord with the amendment which has been submitted to the House regarding this very important measure. It is almost criminal, and, I think, a reflection upon the intelligence of the House, although my right honorable friend does not appear so to regard it, that a Bill of this kind should be pushed forward in the closing hours of the session.
– It has been on the businesspaper throughout the session.
– Then why is it that we are only now discussing it?
– It has been brought on for discussion three or four times.
– And the debate has been adjourned an equal number of times.
– Because of more urgent business.
– Therefore this Bill is not urgent.
– That is not so, but the financial and war measures “were more urgent.
– A great deal more urgent than is this Bill. Every reason which the Treasurer has furnished indicates, in the clearest possible way, that this Bill is not urgent. He was good enough to supply me with a memorandum setting out why the Bill should go through at this stage. I am much obliged to my right honorable friend for letting me have that memorandum, but every reason stated in it is a reason for deliberation and caution rather than, for urgency. So far as I can gather, the Treasurer is anxious to establish branches of the Commonwealth Bank in every town in Australia. He is proposing that it shall enter into competition with the private banks in every town of the Commonwealth. We say that it ought to have something better to do than to go into every town in Australia, which admittedly at present is, if anything, overbanked. Have we no higher functions for this Bank?
– It is part of the business of a bank to compete wherever there is business to be secured.
– It is no part of a national bank’s function. Tell me of a national bank in the world that follows that course. Does the Bank of England do so?
– The Bank of England is not a national bank.
– It is the national bank of Great Britain to-day - the only national bank that they have, and need, in the Old Country. It has seen the people of Great Britain through all their troubles, and in a way so satisfactory as to completely preserve their credit. It is the one bank in the world whose paper is always as good as gold. We do not hear of the Bank of England competing with other banking institutions in every village in the Old Land, or buying up other banks. It has other and higher functions. The Commonwealth Bank should have something better to do than to be competing with all the small banking institutions of Australia for their private business in every Australian town. There are high national functions awaiting it, functions which it alone can discharge, functions of the highest possible consequence to the nation, relating to the general financial stability of the nation, which are specially called to mind in connexion with a crisis such as that through which we are now passing. But, instead of attending to these matters of high import to the country, we are told that it is to compete with all the small banks in every town in Australia. The notions entertained by the Treasurer, and whoever is advising him, are- not those which were contemplated when, the proposal for a national bank was placed in the Australian Labour party’s programme at the Brisbane Conference.
– That proposal goes back to 1889 in Queensland. We then advocated a State bank, covering all these propositions.
– Has the right honorable member been cogitating on this proposal ever since? Is this all that he can do after twenty-five years?
– Order! I would point out that the Leader of the Opposition has already spoken to the motion for the second reading, and that he must now confine his attention to the amendment.
– I am speaking now of the control and development of the Commonwealth Bank. That is covered by the amendment.
– That does not justify the right honorable member in again making a second-reading speech.
– But it justifies me in calling attention, to the proposals which are being made in regard to the control and development of this Bank.
– The amendment does not justify the right honorable member in discussing the merits of the Bill itself. If he had not already spoken to the motion for the second reading of the Bill, he would have ample justification for following that course; but he must now confine his attention to the amendment.
– That is precisely what I am trying to do. I am furnishing reasons for remitting to a Select Committee questions relating to the control and development of the Commonwealth Bank, as proposed by this amendment. The amendment covers the whole range and scope of the Bank’s operations : the transfer to the Bank of the management of the note issue, and the relation of the Bank to State and other financial institutions. Surely I may discuss those points, since they are covered by the amendment.
– When I interrupted the right honorable member he was doing something more than that. He was discussing something which had been said by the Prime Minister.
– Then I wish, sir, that you would not allow these interjections. I am afraid that the Treasurer has a very imperfect conception of the functions of a National Bank. As I apprehend it, he has very imperfect conceptions of what this Bank ought to be and what it ought to do. He has told us that this Bill is only a small one, and that its consideration should not occupy very much time. All that the right honorable gentleman had to say on this question of the national financial institutions of Australia and their relation to this, the greatest of all proposals, covers only one page of Hansard. For that reason, he thinks that we ought to pass this Bill in a few minutes. I take a different view of this Bank. One of the proposals of the Bill, and I submit this is a reason why it should be referred to a Select Com- mittee-
– The right honorable member will not be in order at this stage in discussing any proposal in the Bill.
– Not on this amendment ?
– The right honorable member has just spoken of one of the proposals of the Bill, and I take it that he desires to discuss it. He has already had an opportunity to discuss the Bill on the motion for the second reading, and has done so. I presume that he is now going to repeat the arguments which he then advanced, or to use others in relation to the main question, and that he knows he has no right to do.
– But this amendment proposes to remit the main question to the consideration of a Select Committee.
– That does not justify the right honorable member in again making a second-reading speech.
– This is not a little amendment.
– The right honorable member now tells me that the amendment proposes to remit the main question to a Select Committee. He will be in order in showing why that course should be followed, but he will not be in order in discussing the merits of the Bill itself.
– How, then, can I discuss the amendment?
– The right honorable member can discuss all the issues raised by the amendment.
– That is precisely what I am doing.
– The right honorable member went further, and specially spoke of the provisions of the Bill.
– The amendment proposes that we should refer to a Select Committee, for consideration and report, the questions ofthe control and development of the Commonwealth Bank, the transfer to the Bank of the note issue, and the relations of the Bank to State and other financial institutions. In the Bill itself provision is made for all these matters - for the enlargement of its capital
– I have told the right honorable member that he must not discuss the Bill itself.
– How can I refer to matters relating to the control of the Bank without discussing the Bill ?
– The honorable member is attempting to make another secondreading speech, and he must not do so. I do not wish to argue with the honorable member, but I ask him to confine himself to the amendment before the Chair. In doing that, he will have ample scope, without referring to what the Prime Minister did or did not say in a previous debate or discussing the Bill itself.
– Tuen you rule, sir, that in discussing this amendment I mav make no reference to the Bill ? Here is a proposal to amend the Bill, and you say that I must make no reference to this Bill. What am I to do?
– The honorable member is going further than making a reference to the Bill; he is discussing clauses, and that he has no right to do.
– I did not speak of clauses, but of provisions, which, I said, ought to be considered by a Select Committee. The question of the control and development of the Bank surely raises the question of the additional capital proposed in the Bill?
– The honorable member will not be in order in discussing that.
– Then you rule, sir, that I may not refer to the provision of the Bill which provides for the croation of £10,000,000 additional capital?
– The honorable member must address himself to the matter before the Chair.
– Is that not the matter before the Chair? If everything I say is not in order, will you tell me what will be in order?
– If the honorable; member does not proceed with his speech, I shall find something that is in order.
– You may do as you please, Mr* Speaker - perfectly as you please.
– I name the honorable member for being disrespectful to the Chair.
– This is getting pretty hot, you know!
– My duty is obvious; but I make an appeal to the honorable member for Parramatta, especially at this stage of the session.
– The position is this–
– Order ! I call upon the Prime Minister.
– Of course, my duty is mandatory once Mr. Speaker has called attention to the matter. I should like to say, however, that this is hardly the occasion on which we should have any dissension, if we can possible help it, and I appeal to the honorable member for Parramatta to make a statement regarding the position.
– I do not know with what I am charged. What am I charged with ?
– Disrespect to the Chair; and I am sure you had no intention to be disrespectful.
– I had no intention to be disrespectful to the Chair; but if the Chair thinks that I have been disrespectful, I withdraw the words, and humbly apologize. But really, Mr. Speaker. I do not know what I am to do.
– The honorable member has made ample apology for the position he .has taken up, and I can assure him that I have no wish to curtail his speech. But the honorable member has already spoken on the second reading, and now he is attempting to make another second-reading speech on an amendment which, I admit, is fairly broad in its application. But the fact that an amendment is drafted in such a way is no justification for allowing an honorable member to roam over the ground he has traversed previously.
– I object to the word “roam.” I object to it as insulting.
– I withdraw the word “roam”; but the honorable gentleman was attempting to refer co arguments advanced by the Prime Minister, and also to discuss the main principle of the Bill. The honorable member will be in order in making any references he may think proper to show why the Bill should be referred to a Select Committee, but not in going into the merits of the Bill itself.
– I shall do my very utmost to consider why the question of the control and development of the Commonwealth Bank, and the relations of the Bank to the States and their financial institutions, should be referred to a Select Committee for investigation and
Teport. My first reason in support of the amendment is that the subject is far too great to be considered in this way at the fag-end of the session. Banking has its ramifications in every nook and cranny of the Commonwealth - as the Prime Minister has said in his memorandum - the ramifications extend into every town in the Commonwealth, where, as I say, there is already ample provision in the way of banking institutions. A proposition which attempts to break into this fabric of banking throughout the length and breadth of the Commonwealth is too big and important to be tossed off in this airy manner at the end of the session. T submit that a Select Committee, appointed from both sides of the Chamber, ought to consider whether this Bank should not have some different kind of control from that which it has at present. Remember what this control is over, and what is proposed to be given to the control. One proposal of the Prime Minister is to put into the control of a single manager £10,000,000 additional capital. What does this mean ? It means that we are proposing to give to this Bank a capital equal to the capital of the five largest banks in Australia. Yet tne Prime Minister insists that this is a little measure to be put through in the closing hours of the session, after a short explanation by himself. If ever there was a measure of profound and far-reaching importance to every taxpayer in the community, it is the one before us; and the speech delivered this afternoon is the fullest justification we could have for the further consideration of the measure in the manner proposed. The honorable member for Darwin went over the whole world to show that there was no other proposition like this.
– Now the honorable member is discussing a second-reading speech.
– May I not refer to second-reading speeches?
-The honorable member must confine himself to the amendment before the Chair.
– That is what I am doing - talking about the control of the Bank.
– The honorable member distinctly mentioned the name of the honorable member for Darwin and that honorable member’s speech.
– Why does not the honorable member take an imaginary case, and talk round that ?
– He is out of practice !
– No, I am not out of practice. The proposition is the creation of additional capital to the extent of £10,000,000, which, as I have already said, is equal to the combined capital of five of the largest banks in Australia. Surely that is a proposition which requires further consideration by a Committee of the best financial ability in the House. It is a proposition which ought not to be forced through just when we are about to close our business. To treat the matter in the way the right honorable gentleman proposes to treat it is a reflection on the intelligence of the House. We must protest against this way of tossing off large national matters of great concern to all the people of the Commonwealth. As to the development of this Bank, we are at issue with the Prime Minister in one respect particularly. He has the impression that the functions of this Bank are entirely confined to competition with other banks for private business.
– Largely so. That is the only reason the Prime Minister has given us for the amendment of the Act. The Bill is urgent, he says, because the capital is required to go into competition with the private banks. Our notion concerning the Bank is that, at the present time above all others, we wish to keep away from securities which are constantly falling. Those securities may be falling and rising, but, at any rate, they are unsteady and uncertain. This Bank should, in our judgment, confine itself to large matters of national importance concerning the States and the institutions of the States. That is why we propose to send this Bill, if we can succeed, to a Select Committee, so that when we meet again we may have submitted recommendations which will have the approval of both sides of the Chamber, and which may lead to a compromise between the two phases of thought on this particular question, and thus obviate trouble and bring us all, as we ought to be, solidly behind the Bank, approving of its control, of its lines of development in its relation to the States and institutions of Australia and its general relation to the taxpayers of Australia. The
Prime Minister wishes to keep the Bank in a narrow groove, whereas we say that it ought to be on a high national level performing high national functions. Then there is the ‘question of the transfer of the note issue to the Bank, and the management of the issue by the Bank. This is a question which has been debated before in the House, and now it is raised again. This Bank, in my judgment, has proved itself quite inadequate and unequal to the high duties which have appealed to it in this time of national crisis. I think that the notes should be in the Bank, and belong to it; but all depends on the control and management. Our idea is - and I hold this very strongly - that if we can only make the control of the Bank right there are no functions that you may not give to it. Everything depends on how these functions are to be managed - the control is everything. This is where we join issue with the Prime Minister. For those reasons I think the whole question ‘should be remitted to a Select Committee. I have here some statements relating to the capital of other banks to show why further consideration is necessary. I do not know, however, whether I dare refer to these statements under the stringent conditions laid down by you, Mr. Speaker, as to the conduct of debate; but it seems to me that we cannot usefully discuss the question unless that is done. This is a proposal to inquire into the relations of this Bank to the State and other financial institutions, and, therefore, I think I can make the reference. The Australian Bank of Commerce has a capital of £1,200,000; the Bank of Australasia £2,000,000; the Commercial Bank, Sydney, £2,000,000; the Bank of New South Wales, £3,000,000; and the Union Bank, £2,000,000. These sums amount to just about the capital which we are proposing to give into the control and management of this one man; and yet, in the case of the banks mentioned, we have five distinct directorates - five distinct general managers associated with five distinct boards of directors. A very useful form of inquiry would be one that would get the opinions of some of the financial experts of the world, and, if necessary, put them against the opinions of the Governor of the Bank. I take it that we do not set the Governor up as the last word in banking knowledge, skill, management, or reputation.
I say nothing against him, nor against his control of the Bank, but that control has been limited and fettered throughout the Bank’s operations, because of the lines on which the Bank hasbeen constituted. It will give him a wider sphere, a more useful function, if you constitute the Bank on other lines,, and put it on a different footing in itsrelations with the other financial institutions of the country. The Commonwealth Bank should be the banker of the other banks. That is the relation of the national banks of other countries to the private banks of those countries. Here the National Bank stands idle, unable to help us in this time of crisis. The Treasurer is doing what the Bank should be doing. It is he who controls the credit of the Commonwealth. He dispenses it, fixing terms and conditions, and establishing relationships with the banking institutions of Australia. Yet honorable members opposite say from every platform that the Commonwealth Bank is doing this, that, and the other, and is helping us in this time of crisis. The Treasurer himself says that the resources of the Bank should be largely augmented, and should be equal to those of five of the largest banks in Australia. He is attempting to give the Bank sufficient resources. I submit that everything depends on the lines on which the Bank is constituted, particularly since the Treasurer has assumed the relationship of banker for the States. He is using the Commonwealth Bank as his agent. That is the only useful function which it is performing during this crisis.
– That is not so. The Bank has helped the Commonwealth, apart from acting as agent.
– It can do very little more, because it is without capital. Its sphere of action is limited. The Bank is not a principal; it can act only as an agent, taking charge of funds which the Treasurer has provided from other sources. It is to be the agent in connexion with the £10,000,000 which we have borrowed, and I suppose will be paid as a private bank would be paid.
– It will receive1/4 percent.
– There is a. great difference between acting as an agent, as the Bank is doing now, and having resources and credit sufficient to enable it to come to the rescue of the other banking institutions of the country, and to meet the general financial requirements of the Commonwealth. The Commonwealth Bank is in’ a subordinate position, and can never develop into a big national bank on its present lines. Its control should be fundamentally altered, so that it may develop. Instead of entering into competition with the other banks, to try to knock them down and out in every village and hamlet in Australia, which the Treasurer says is his intention, the Bank should have more important work to do. There never was a greater need than there is at the present time for a big, broadly settled financial institution with great powers and resources, controlled by a wise board of directors. , Such an institution could establish proper relations with the private banks, and ultimately evolve a scheme for the financial control of the national relations of the Commonwealth. That is what we ought to aim at. The best financial brains should be used to discover the lines on which the Bank should be laid down. The Prime Minister seems to have in his mind the conduct of the ordinary operations of banking, which the private banks are doing so well over the whole area of the Commonwealth. If ever there was a proposition which should commend itself to the House, it is this, to exhaustively inquire as to the constitution of the Bank necessary to secure its proper development. Why should we enter into competition with the Savings Banks of the States? We should not take a penny which the States ought to be getting. In these days the deposits in the Savings Banks are the only financial resources of the States so far as the local market is concerned. They provide the State Governments with current money, which is usefully employed in the development of the country. The business of a national bank is the transaction of national banking. We should not try to attract away Savings Bank business, which is peculiarly associated with the territorial development of a State. I am not to be understood as making the slightest reflection on the Governor of the Commonwealth Bank. My desire is to give him bigger functions and better control, so that the Bank may gradually acquire the confidence of the Governments of the States and of the private banks of Australia. To-day it has not this confidence. The private banks do not look with favour upon it. In Great Britain the Bank of England is the one source of strength, to which all other banks look as a rock and a fortress. But no private bank looks to the Commonwealth Bank as of the slightest use. This state of things should be brought to an end at the earliest possible moment. The National Bank should be able to stand behind the other banks, strengthening their resources, and enabling them to meet their obligations with a confidence and security that would not otherwise be possible. Instead of putting the Commonwealth Bank in that position, the Treasurer is merely trying to drive some of the private banks out of the market, and to take from them their ordinary banking business. This one-man control, to my way of thinking, is not in accord with the genius of our democratic institutions. More and more is the Treasurer getting the notion that nothing can be done in Australia which is not done by one man. I am afraid that he does not reflect where he is going. He is gradually setting up a bureaucracy which may become an absolute and unqualified tyranny. One-man control should operate where it must. But there should be no increasing of autocratic control unless that is necessary. In regard to borrowing and lending in the transactions of ordinary and State business, it would be better to have some one at your elbow, were you the greatest financial authority in the world, than to be alone, detached from everything and everybody, owing responsibility to none in the details of management. This House should not tolerate that kind of thing’ for one moment. We are, every one of us, responsible for all the multifarious transactions this Manager does. We are behind him, and if anything goes wrong we have to foot the bill. Therefore, we should have greater assurance than he can give us that everything is being put on the proper footing, and is controlled in the interests of the people of the country as a whole. I do not think that we can find anywhere a control like this. I do not know of any institution in the country where one man to-day is doing what this Manager is doing. For instance, he is putting up great banking buildings up and down Australia, consulting no one as to what he shall do, disposing of his funds without let. or hindrance, accounting to no one except in a general sense in his balancesheet, which tells very little, and declining to let us know even the lines on which his business is proceeding.
– He has not done that.
– That is precisely what he has done. The right honorable gentleman may know what he is doing, but no one else does. Certainly I did not when I was Prime Minister, and certainly the late Treasurer did not when he was at the Treasury.
– The Governor of the Bank has responded to every request for information.
– The right honorable gentleman says some astounding things, and what he now says is about the most astounding of all his statements. He knows right well that the Manager of this Bank has declined, time and time again, to . give the slightest information about his huge financial transactions. We passed a proposition to-day to refer proposals of high national importance connected with Naval Bases, the building of the Federal Capital, and the construction of railways to a Committee of this House in order that it might check our own officials and give us independent reports concerning what those officials are doing in these matters, yet those proposals will not run into one-eighth of the sum which the Manager of this Bank spends without reference to any one.
– I can tell, by the right honorable gentleman’s style, that we are going to have a terrible night of it.
– The honorable member should not talk like that. I have no wish to give him a “ terrible night of it,” and to show him just for once that I mean what I say I shall resume my seat.
.- I rise to support the amendment, and the observations that I desire to offer shall deal, in accordance with Mr. Speaker’s wishes, only with tlie questions dealt with in tlie amendment, which .are of a three-fold character - the control .and development of the Commonwealth Bank, the transfer to that Bank of the management of the note issue, and the relations of the Bank to State and other financial institutions. I understand that it is proposed that these three questions shall be referred for consideration and report to a Select Committee; and dealing with them in order, I take leave to say that the remarks of the Leader of the Opposition, pointing out the vital distinction that must exist in the management of this institution between autocracy and democracy can pardonably be dwelt upon, even if it means some delay at this stage. I cannot understand how the right honorable gentleman the Prime Minister, leading a party of progress, as he proclaims it, which carries on its banner the declaration that it is a democratic party, can oppose the wishes of those who seek to make the management and control of the Commonwealth Bank more democratic and less autocratic. In view of the professions of the right honorable gentleman, his attitude is hard to understand. I believe that if, apart from the natural desire of every parent to see the child of his loins make his way hi the world, he would cast aside the memories of the days when he first proposed this scheme he has so much at heart, he would declare that democratic management was preferable to autocratic management. Our reading teaches us that there is no other bank in the world of a State or national character that is governed by one man. In every other great institution endeavouring to discharge high, and important national functions, such as are conferred on the Commonwealth Bank, there is a committee, directorate, or board of governors, and only on very rare occasions, sometimes in times of emergency, as history teaches us, have these general functions been fused in the hands of a financial dictator. The broad policy of national banking in the four great continents has been control, management. and development by more than one man. This leads us to the thought: Why should not a directorate, properly composed and representative of both schools of thought in the House, be calculated to do better work than can be done by leaving control to the judgment of one man? I may admit, for the purpose of my argument, that the ‘Governor of the Commonwealth Bank is a superman in finance, and that his judgment is as infallible as that of any ordinary or extraordinary man can be. Nevertheless, I have faith in the old maxim that more than one head is necessary to control big interests. “ Many men, many minds,” is an important maxim. An honorable member on a former occasion said that a small idea coming from one man, maybe a layman and not an expert in finance, but sitting as a director on such a bank, in conjunction with the Governor of the Bank, will very often contribute to the progress and stability of the institution; and in connexion with this matter I strongly recommend that a Select Com.mittee, if the House determines to appoint one, should have the widest power to investigate the systems of banking to which I have referred, and see whether it is true that most wisdom lies in the one-man control of national institutions such as the Commonwealth Bank. If I needed a stronger argument, with no desire to injure the prospects of the institution or to destroy its future, I could point to tlie present position of the Bank. Because it was badly launched, according to my judgment, it has had & very lingering youth, and its Savings Bank department, as I shall attempt to show later on, cannot compare, by any legitimate tests, with the institutions that it met in competition. But, leaving that aspect for the moment, let us glance at its funds. According to a return laid by command before the House on the 26th of last month, bringing the aggregate affairs of the Bank up to the 30th June, 1914, we see that its total funds amount to. £9,773,690 13s. 9d., roughly speaking, £10,000,000. Now honorable members who will study the balance-sheet of the Bank will be struck by the extraordinary mode of investing these funds as disclosed by the figures shown for the 30th June last. I believe that on former occasions allusion lias been made to this elsewhere; but if I dwell on the matter for a moment it may point a moral. On the assets side of this large sum, coin, bullion, and cash advances amount to £2,670,446, which is considerably over 25 per cent, of the total funds of the Bank. Recently an honorable member, quoting from McLeod, who, in the realm of economic literature, is the most acknowledged authority on banking practice and principle, showed that in a well-managed bank it was only necessary to keep as an ordinary line of defence 10 per cent, of the actual cash lodged in the Bank. Yet here the coin, bullion, and cash advances stand at more than 25 per cent. However, that is not all. To those cash advances Commonwealth notes to the extent of £41,025 are added, while the money at short call in London amounts to £1,465,000. I suppose that the lowest returning money to-day is money at short call in London. It seems strange that, when money is so tight, it should be said that in the financial metropolis of the world short-dated loans are cheap; but, nevertheless, in the month of July, or in the first week of August, 1 per cent, was the figure that thirty and sixty days loans returned. With great respect to the large financial experience of the present Governor of the Commonwealth Bank, that we should have practically £1,500,000 lodged in London, and kept at short call, not returning anything like the interest which is being paid to the Savings Bank depositors, whose money it presumably is, seems extraordinary.
– How long had it been there before the balance-sheet was made up ? You can bet that it was not there very long.
– The meagre details with which we are supplied on the balancesheet do not show how long it had been there, nor do they give one-tenth of the information to which honorable members are entitled.
– You are criticising the Bank, without knowing anything about it.
– I admit frankly that there are certain features of. the practices of the Bank that are hidden behind frosted windows from the eyes, not only of the people, but also of their representatives; and when we attempt to dissect the condition of the institution, we are told, in effect, that it is so mysterious that we do not know enough about it to criticise it.
– I have listened te the honorable member, and for a considerable time his speech has referred to the Bank, and its inner workings and management. So far- the honorable member has not advanced reasons why the Bill should be submitted to’ a Select Committee. He is dealing with the management of the Bank. I ask him to confine his remarks to the amendment, which is the only thing now before the Chair.
– I am extremely anxious, Mr. Speaker, to obey, not only your ruling, but your lightest wish. The whole basis of my argument - although I cannot express it in every sentence - is to show that the condition of the Bank is such that its affairs demand investigation, and the mode of investigation proposed by the honorable member for Flinders commends it to my judgment as the one most likely to suit public requirements. If you, Mr. Speaker, think that I am wandering widely from the issue, please remind me, and I shall confine myself as well as I can to the matter contained in the amendment.
– The honorable member is going into too much detail in relation to the Bank.
– That, I submit, sir, is my concern, so long as I confine myself within your ruling.
– I shall allow the honorable member all the latitude I can, but if he does not speak to the question I shall stop him
– When I am stopped I shall bow cheerfully to the ruling; but I take leave to say that any illustration of the condition of this institution which seems to me to warrant .this form of investigation will be appropriate to the amendment. The desire that a SelectCommittee shall be appointed shall be the goal of my remarks. I admit that we have nob sufficient detail to warrant us in dogmatizing finally on such matters as the Committee will have bo adjudge, but that is the fault, of the Executive, because, under the principal Act, provision is made that returns connected with th assets and liabilities of the Bank are to be supplied to the Treasurer in such form as is prescribed, and if the forms from which I have been quoting are insufficient to enable us to form a judgment, the reason lies in the fact that the form in which the information is supplied has been too niggardly. The prescription in the regulation has not been sufficiently wide to give this Parliament and people the enlightenment of which they stand in need. There is, besides these amounts, in the invested funds of the Bank £2,818,981 in British, Colonial, and Government securities. I do not object, nor does any other man, to a second line of defence being in the securities of this Bank, but when considerably over 25 per cent, of the Bank’s funds is held in Government securities I venture to say it is violating a condition, which tlie House supposed was precedent to its existence, that it was bo operate for the use of the people, and not for the Government primarily. For bills receivable in London, remittances in transit, bills discounted, and for loans and advances bo customers, and other sums due bo the Bank, two amounts are mentioned which total £1,713,000. Those two items are the only legitimate banking items, as we understand them, in the whole scope of the assets of the Bank. Out of £9,700,000 only £1,700,000 has gone for the accommodation of the people in oversea bills and various banking advances. Does nob this fact, recommend itself bo all of us as being worthy of investigation ? That is one reason why I support the amendment, which, I trust, will lead to an alteration in the control and better management of the Bank. The next question dealt with in the amendment is the note issue, and it is suggested that ib would be advisable for the Select Committee to inquire into the desirability of transferring the note issue from the control of the Treasury to the control of the Bank. At the present time we meet this astonishing anomaly, that it is asserted by the head of the Government that one of the recommendations of this Bank, and one of the sources of its strength, is that it is nob under political control. I agree to a large extent that political management, in the pioneering or infantile stage of a great national institution, especially in a country where our politics are so sensitive to public influence, might be fatal to the proper rearing of the institution If that be so. with regard to the Bank, is it not equally so with regard to the note issue? If political control be baboo for the management of the general affairs of the Bank, Surely political control should be withheld from the note issue. We have the astonishing anomaly that, out of the same pair of lips, those of the right honorable the Treasurer, we have heard an advocacy of political control of the note issue and non-political control of the Bank. Let us send to the Committee the question of whether ib would not be better. wiser, and safer bo place the control of the note issue to the same authority as guides the affairs of the Bank?
– Although you say the Bank has not been properly managed.
– The hope of the mover of the amendment is that the control and management of the Bank will be altered as a result of inquiry by the Committee, and it is on the basis of that hope that these three propositions hang together. There is another question associated with the transfer of the control of the note issue, and that is as to where the profits of the note issue should go. At this particular time the profits are, according to the language of the Treasurer in his Budget speech, going to swell enormously this year, proportionately to the swelling of the note issue, both in circulation and in holding. That being so, it would be wise to bind up the two enterprises in one, so that the profits from the whole of’ the financial reforms of the party responsible for the launching of the Bank and the note issue should be presented in the one balance-sheet. I take it that currency is inseparably associated with banking. It is true that some clement of either accident or design originally put the control of the notes iu the Treasury and appointed the Governor of the Bank to administer banking affairs; but that position is not logical, and, as tune rolls on, I venture to hope that the successors of the Treasurer, either from the Labour party or the party now in Opposition, will see the wisdom of putting under one control, representative, I trust, of the whole of the governmental interests of the country, the issue of the notes, as well as the control of the great National Bank.
– Currency is only incidentally associated with banking.
– Epigrams flow from the honorable member as, in the words of Mark Twain, the precious “ ottar “ of roses flows out of tlie otter. I beg of the right honorable gentleman not to assail me with any of the platitudes which we read in our younger days - and which occur so frequently - in certain Fabian essays. Leaving the note issue in the hope that these reflections will not fall altogether upon stony ground, but upon fruitful soil, and bring forth fruit, if not one hundredfold, at least abundantly, I pass on to another phase of the amendment which deals with the relation of the Bank to State and other financial institutions. I do not wish to labour the motive which induced the attacks on the Savings Banks, and the competition which was thereby engendered, or the stimulus which, according to some honorable members opposite, was thus introduced into the Commonwealth Savings Bank as well as into the State institutions. But I do desire, in the language of the Leader of the Opposition, to say that all the Commonwealth Banking Act has so far done is to superimpose upon the then existing banking system of Australia another bank. There are reasons, I have no doubt, in the mind of the Governor of the Bank why this should not be the case, and the proposition to buy out other banks is on that ground conceivable. In other words, I believe it has been the intention of the Government to acquire by purchase other banks, and thus prevent .a continuance of the pitiless nature of the competition up to date. That is to say, there is a sign of relenting on the. part of the Government - a desire to work in harmony with the other institutions, and to buy their good-will. I think that proves clearly that the competition which, was launched so gaily some three years ago has failed, so far as the Commonwealth Bank is concerned. The rich harvest of deposits which was expected has not come to the Bank. In fact, if we compare the figures of certain other institutions with those of the Commonwealth Bank, it will be seen that the Governor of the national institution has reason to be bitterly disappointed.
– Will you explain why the Commonwealth Bank did not get as much money as the other banks?
– There were many reasons. One was the spirit of hostility induced towards the Commonwealth IBank in the other governmental forces of Australia. Another reason was the recognition by a large number of people that the older institutions, which had existed for very many years - in some cases threequarters of a century - had done their business well.
– Especially 1891-2.
– The State Savings Banks never closed their doors against the people in those days.
– I understood that you were referring to private banks.
– No; I leave that argument alone for settlement by those who are most interested. I am chiefly concerned in showing that the State Savings
Banks, the most highly organized of the forces of State enterprise which have been undertaken in Australia, were completely satisfactory to the Government and the people, and it is no wonder that resistance was offered when a fresh competitor entered the field.
– Is it not a fact that the Commonwealth Bank offers a lower rate of interest? *
– I am coming to that point later on. Another factor which doubtless led to the success of the State institutions was that they determined to keep their business. When that competition came along, they did not put up their shutters or haul down their brass plates, but, realizing that so much of the social and industrial progress of the community was bound up in their success, they resolved that they would endeavour to retain the business which was then in their hands. Accordingly they raised the rate of interest. But, even allowing for that, I have heard utterances on the platform by representatives of the Labour party that, notwithstanding the disparity of i per cent, in the rate of interest, the profound confidence of tlie people in the National Bank would be such that they would gradually withdraw their savings from the State institutions, and pledge them to the National Bank. That has not taken place.
– I am sure they will go there eventually.
– If the honorable gentleman remains in power they may; suffocation will end them, and monopolization and transfer will destroy the competition. But there is nothing in the programme of the party with which the honorable member is identified which expressly gave them a mandate from the people to do this special branch of banking work. I read the Labour party’s instrument ot government with very much care and assiduity, and I could find no reference to Savings Banks in their platform. When the party gathered in 1910, and resolved to launch a National Bank because it was in their programme, they were advised by somebody to make part of the activities of that Bank a savings branch. They conceived that idea to be both necessary and usual, and they pushed it into execution. I say that the launching of a Commonwealth Savings Bank branch was neither necessary nor usual. In fact, so far as I have been able to read in the course qf a busy life, there is no National Bank in any part of the world that does. Savings Bank business. Is that not a significant fact? Does it not indicate that the men who launched this Bank on the financial waters of Australia were unacquainted with the conditions that ruled in comparable institutions in the northern hemisphere ? In fact, there has always been the thought, clear and defined, in the records of banking, that banks perform certain functions. There are certain classes of banks for certain purposes,, and other classes for other purposes, and the Savings Bank has always been separated from ordinary commercial and national banking.
– A sort of patronized institution ?
– It was not a patronized institution, but was originally promoted to conduct useful services for the man wlm has small savings, and to mobilize those savings, so that they maybe used to the advantage of both depositor and borrower. If I were asked to> put my finger on the institutions that have done the most credit to the MotherCountry, I should point primarily to the friendly societies, and secondly to the Savings Banks. Men who had only small savings had no chance of lending at anything like the market rate of interest by putting those savings on the counters of private banks or large and wealthy corporations, which were able to draw into their coffers the small savings and use them as an increment to their securities. The Savings Banks have performed an immensely useful service, and amongst the most successful of these are those which exist in Australia.
– They should be under Federal control.
– That seems to be the faith that dominates every item in thehonorable member’s political creed. If all this business were under Federal control, then he would be happy and bright. He would say the same in regard to the control of the railways, the mines education, and the police and law administration of this country. In other words he, like the Gadarene swine, would rush to destruction down theprecipice of Unification. If the honorable member is not familiar with the- incident, I will point it out to him in the Scriptures later on.
– Very unmannerly.
– The honorable member is making some allusion to my age.
– Nothing of the sort.
– Then it is to my looks.
– The honorable member is old enough to be more sensible.
– I accept the compliment in the spirit of humility which is characteristic of me, but am sorry that I cannot return it. May I be permitted to continue my comparison of the progress of the two institutions in active competition - the State Savings Bank in this corner of tlie continent, and the Commonwealth Savings Bank in the same area. I shall give the figures for quarterly periods. For the quarter ending 30th September, 1912, the State Savings Bank of Victoria had an increase of deposits - in other words, an excess of deposits over payments - amounting in round figures to £290,000, whereas for the same period the excess in respect of the Commonwealth Savings Bank in Victoria only was £237,000. For the quarter ending 31st December, 1912, the State Savings Bank increase was £293,000, and that for the Commonwealth Savings Bank £154,000. For the quarter ending 31st March, 1913, the increase in the State Savings Bank’s deposits was £338,000, as against £131,000 in the case of the Commonwealth Savings Bank. For the quarter ending 30th June, 1913, the State Savings Bank showed an excess of £350,000 in deposits over payments, as against an excess of £124,000 in the case of the Commonwealth Savings Bank.
– Is the honorable member giving the rates of interest paid by the two banks ?
– No, because I cannot give more than one set of facts at a time. I wish I had the duplicity - I mean the intellectual duplicity - of my honorable friend.
– Would it be-
– The honorable member is taking up some of my time. I think it would be advisable if - as in the football field, when a ball is deliberately kicked out of bounds, time off is registered - an honorable member were allowed time off in respect of interruptions. For the quarter ending 30th June, 19.13, the excess of deposits over payments in the State Savings Bank of Victoria was £350,000; in the Commonwealth Savings Bank, £124,000. For the quarter ending 30th September, 1913, the excess in respect of the State Savings Bank’s deposits was £160,000, as against £130,000 for the Commonwealth Savings Bank. For the quarter ending 31st December, 1913, the State Savings Bank showed an excess of deposits over payments amounting to £346,000, whereas the excess in the case of the Commonwealth Savings Bank was only £85,000 ; while for the quarter ending 31st March, 1914, the excess in the case of the State Savings Bank’s deposits was £438,000, as against an excess of £107,000 shown by the Commonwealth Savings Bank. These figures show that when the Commonwealth Savings Bank was first established it obtained the excess of interest-bearing deposits, as the State Savings Bank authorities knew it would. Its coffers were swelled proportionately, and a large number of new accounts opened. But as the competition continued quarter after quarter *he progress of each - to use a colloquialism, was equal and opposite. The growth of the State Savings Bank’s deposits became more marked as the months went by.
– Due largely to the increased interest which the State Savings Bank offered its depositors.
– No. The increased interest was given immediately the competition started, and that was when the rate of progress shown by the Commonwealth Bank was most pronounced. There was no special incentive held out by the State Savings Bank during these later quarters; yet it was then that it established its supremacy.
– Surely the higher rate of interest was a continued attraction.
– If that suggestion were correct, we should see the incentive starting to operate the moment the rise in the interest rate took place. But we see quite the contrary. There was very steady progress made during this period, and as confidence began to be re-established in the State Savings Bank, after this primary attack, the older institution forged ahead. The totals are very startling. The total increase of deposits over repayments for the twenty-one months in Victoria was £2,217,965 in the case of the State Savings Bank, as against £971,522 for the Commonwealth Savings Bank.
– What was the extra cost to the State Savings Bank of getting this extra money ?
– I propose to give this information. As I shall show by reference to the report of the Savings Bank Commissioners of Victoria, if I may be permitted to do so, it amounted to Id. per transaction. I want now to give the measure of progress, not in pounds, shillings, and pence, and not, as the honorable member for Indi did previously, on a percentage basis, but in the increase in the number of accounts. That, I think, is the best test of the three. For instance, the older institution should not only continue to keep its business, but should obtain a large increase of business, because of ite widespread connexions. But in the case of the newer institution, every increase of £100 in respect of the smaller total would represent a very much larger percentage than would be shown by a larger increase iu respect of the larger total of deposits held by the older institution. A percentage comparison, therefore, works out unfairly. By taking the increase in the number of accounts, we have a fair test, and this is how it works out: For the quarter ending 30th September, 1912, the Victorian State Savings Bank’s increase of accounts was 9,498. The figures I am now giving relate to the excess of accounts opened over those closed. As honorable members are aware, accounts are continually being opened and closed, and these figures, so to speak, show the excess of births over deaths. The excess for the State Savings Bank, in respect of the quarter ending 30th September, 1912, was, as I have said, 9,498, as against an increase of 6,894 in the number of accounts in the Commonwealth Savings Bank in .Victoria only. For the quarter ending 31st December, 1912, the increase in the number of State Savings Bank’s accounts was 4,918, as compared with 3,224 for the Commonwealth Savings Bank in this State. There was a drop of one-half during that first starting quarter. For the quarter ending 31st March, 1913, the excess in the number of accounts opened over the number closed was: State 8,567, Commonwealth 3.633; quarter ending 30th June, 1913, State 9,823, Commonwealth 3,851; quar ter ending 30th September, 1913, State 9,157, Commonwealth 3,762; quarter ending 31st December, 1913, State 5,449, Commonwealth 2,993; quarter ending 31st March, 1914, State 9,382, Commonwealth 3,377. The figures, so far as the Commonwealth Savings Bank is concerned, relate only to Victoria.
– Were these the increases in the number of accounts opened in the old-established branches of the State Savings Bank ?
– Not in the State school penny savings banks?
– No. We thought it advisable in ‘this State to encourage school children to put money into penny banks, such as have proved so serviceable to the working classes in the Old Country.
– But the figures quoted by the honorable member do not relate to them 1
-No; they are kept in separate accounts. The progress made in the matter of amount is small, so far as these penny savings bank accounts is concerned, although the number of thrifty depositors is very gratifying. The excess of accounts opened over the number closed in the State Savings Bank of Victoria for the twenty-one months was 56,794, as against 27,734 in respect of the Commonwealth Savings Bank in Victoria.
– But the Victorian Savings Bank was offering an additional A per cent, interest.
– I am constantly being reminded of that fact. I prefaced my reply to the Minister of External Affairs with the statement that we gave an additional J per cent.
– Was not the increase in numbers greater in respect of the State institution than before ?
-No; and I think in amount it was slightly less. Although the Victorian Savings Bank has kept its business, the accretions have not been so substantial since this competition started as before. Our efforts registered, roughly, an increase of £2,000,000 per annum in the amount of deposits in the State Savings Bank prior to the establishment of the Commonwealth Savings Bank, but that has not been kept up since.
– The honorable member promised to supply figures as to the relative cost.
– I cannot give the relative cost to the State and the Commonwealth institutions, for the reason that the cost to the Commonwealth Bank, as the honorable gentleman is aware, is not supplied ; but I can give the cost to the State. Let me take the figures for 1910 as the year in which no competition operated. The expenses of management per cent, is one measurement adopted by the State Savings Bank, and in that year it was 8s. 5d. In 1913 it had risen, as the result of competition, to 9s. 11d., or ls. 6d. per cent. When honorable members realize that the margin over contingencies - that is the difference between interest paid on deposits plus working expenses and the earnings of the average investments in the bank is so small as 3s. 8d. per cent., they will see what a huge invasion an increase of ls. 6d. meant. It mopped up about. 33 or 34 per cent, of the margin for contingencies. The measure of cost per transaction is an important feature. As our business grows we expect this cost to drop; but in 191.0 the cost per transaction was 5d.. whereas in 1913 it was 6d. That is an increase of exactly1d.
– That was the cost of getting the business and holding it.
– Yes. It represents, roughly speaking, about £30,000, due to the opening of branches and to the change of agencies from post-offices to ordinary private agencies.
– Does the honorable member include interest on new buildings ?
– It includesrent where premises were rented, or interest on buildings which were erected. In other words, it covers all expenditure incurred in consequence of the new policy of war - to hold the business of the State Savings Bank against the Prussian invader. We had to spend that money just as the Allies have to spend their money to-day to keep out the Prussian invader.
– Simply because you would not agree to the reasonable terms submitted by the Federal Treasurer.
– I am glad of that interjection, because I was in danger of forgetting a matter in which the Prime Minister, if I may say so, ought to be interested. A proposition was laid before the States in 1912, which, if it had been in a fairer form, would have rendered unnecessary this amendment to the motion.
– When the honorable member spoke first he thought that the offer was not there.
– I was well aware of it when I spoke on another occasion. I said that I had refreshed my memory as to the attitude adopted by several men in the Conference, including myself. I have refreshed my memory again, and marked several passages which I shall lay before honorable members.
– But I think the honorable member said I made no proposition.
– I said that the right honorable gentleman made no proposition of a bona fide partnership. He persisted in calling the proposal he made a partnership proposal, but it was one which I described as merely the invitation of the spider to the fly, and it was an invitation which we, as representatives of the flies, resisted. The proposal referred to is printed in Appendix B to the report of the. Premiers’ Conference of 1912.
– Why not read what was said ?
– I shall first read this appendix, and then come back to the other matter. The appendix was as follows: -
The States to become partners with the Commonwealth in the Commonwealth Bank -
In other words, the States were asked to become partners by putting in some of the capital, taking their share of the losses, and participating in the profits -
Each State to use the Bank as far as practicable as its banker.
The Commonwealth Bank to take over the Savings Bank of each State, whether Government or trustee, as a going concern.
After the Commonwealth Bank has taken over the business of the State Savings Bank, the State Government to have first call on any amount which it repays to the Savings Bank in redemption of loans existing when the Bank was taken over; -
That is the old money - also, to have first call on three-quarters of the amount of deposits in the State available for investment.
That is what we knew as the new money. There was no talk of any share in the control.
– But there was the statement I made.
– I do not wish to do the right honorable gentleman an injustice.
– I wish to be accurate.
– Accuracy is a virtue with the Liberal party always, though it may not always be a virtue with honorable members opposite. I trust, however, that it is a virtue which will become equally familiar to both of us.
– The honorable member has read the appendix first, and not the statement I made.
– If the right honorable member desires, I shall read his statement at tlie Conference, because I think it was one of the best speeches he ever made, by a long way, and he made it sitting down.
– It is too late for flattery.
– It is not flattery. I do not speak of the right honorable gentleman in terms of adulation; I condemn him so frequently that I dare not; but, notwithstanding that he is so frequently wrong, he was, on this occasion, temperate. However, bis brutal frankness drove him from the Conference unsuccessful - that was the position. Does the right honorable gentleman desire me to read all or any of his speeches? Perhaps, later on, I shall do so; but in the meantime I shall deal with some of the discussion which took place with him on these particular points. I shall not take thi extracts from their context, but as they stand, and the unflinching and unbending attitude of the Prime Minister will become more plain and visible. The Conference, without speeches, was discussing, in a give-and-take way, with the Prime Minister the proposition he had made, and the report proceeds -
– Supposing the States joined in this proposal, have you thought out the proposition for appointing a director or representative of each of the States with a similar number of representatives for the , dominant partner, and probably with an independent chairman? Is that within the realms of possibility*
– We have considered that, and the Commonwealth Government feel assured that the safety and progress of this banking concern lie in transferring the management to a Governor, and in removing, as far a.s possible, political influence from it. If Mr. Watt reads the Act, he will see that it gives full power to the Governor as regards the management of tlie Bank and the officers, subject to mere auditorial investigations which are necessary.
That was the first direct refusal to any proposition of partnership in control, and I think the Prime Minister will agree that a partnership cannot be a real one which merely in vibes us bo pub our capita into the business., to share any profit and loss, but gives us no say in the management, whether it be with regard to th? Bank as a whole, or only in regard to that particular part in which we were vitally interested, because we had an established and satisfactory business. However, the argument was taken up by another representative of the States, Mr. Scaddan, of Western Australia-
– Would the honorable member mind continuing what he has read for a few sentences further on?
– I was connecting the argument, but I shall do as the right honorable gentleman desires. This portion of the report of the Conference proceeded -
– The Commonwealth Treasurer has power to deal with investments.
– Only certain investments. They are very limited.
Mr. Scaddan. ; And you also have power to remove the Governor at any time.
– Only by paying him compensation.
Mr. Scaddan. ; He could be removed by the two Federal Houses.
– Yes. He is engaged “During good behaviour.” That is a well-defined legal term.
Mr. Brown; He is in the same position as a Judge.
I omitted that, because I did not consider it relevant. The report goes on -
Mr. Scaddan (to Mr. Fisher). ; Assuming that the States and the Commonwealth were co-partners in this banking scheme, have you thought of the desirability of having some Board of Advice on which the States and the Commonwealth would have equal representation?
– My mind runs in the direction of having a consultative body. The Treasurers of the States and the Treasurer of the Commonwealth could consult from time to time. .1 am rather of the opinion that wisdom will not die with this generation -
I think it was Job who first discovered that thought, and it was published in an ancient treatise known as. Holy Writ.
– The honorable member is a bit “ rocky “ on the Scriptures!
– What part of the Scriptures is the reference to?
– I think it is to Solomon.
– I do not know whether the honorable member remembers how the Lord answered Job out of the whirlwind, and said, “ Who is this that darkeneth counsel by words without knowledge?” And also how, about the same time. Job, in answer to his three friends, said, “ No doubt but ye are the people, and wisdom shall die with you “ ? I recommend the honorable member to take night-school lessons in Scripture study. To continue the report - and if an amendment is discovered to be neces sary after we do enter into an agreement, the members of the Conference can rest assured that injustice will not be done.
That is what the boy in the lawyer’s office calls an “ ewasive “ answer. Mr. Barnes, the Treasurer of Queensland, seeing us hurled, mangled, to our doom, took up the argument.
Mr. Barnes. ; Even assuming we did enter into a co-partnership, it seems to me that the position would be that the Treasurers of the States could confer with the Commonwealth Treasurer, and yet find, after conferring, nothing done to give effect to their wishes. It seems to me that this co-partnership, as was pointed out by Mr. Watt, is one-sided in that. If there is a difference of opinion the Commonwealth Treasurer will be supreme.
– That is so: but weight of argument must tell against the Commonwealth parliament as well as against the States Parliaments.
We have used weight of argument, and other heavy metal, all through the session, but it has fallen on the impregnable fortress guarded by the Prime Minister. The right honorable gentleman said -
We have to appeal to an enlightened electorate every three years-
It was not enlightened on the 13th April, but still he said that - and any injustice done to the States would undoubtedly be punished by the electors of the States. As the electors of the Commonwealth and the electors of the States are the same people, I have no doubt at all that no injustice will be done either to the Commonwealth or to the States’.
That is the answer we got to our direct pressing, and, I think, it must be acknowledged, pertinent inquiry of the right honorable gentleman in charge of the Government. I pass now to Mr. Holman. who, as then Attorney- General of New South Wales, said, in the middle of a very interesting, statement -
I quite see that Mr. Fisher is very anxious that the management of the general banking business should be, as far as possible, under the control of the Commonwealth. Has he considered the possibility of maintaining the complete Federal control of the generalbanking business, and at the same time admitting the States to an effective share in the management of the Savings Bank business, which their activity has created, and in respect to which the Commonwealth is doing nothing but take it over? Has an arrangement of that kind been considered, and, if not, could it be considered ?
– You mean putting them in water-tight compartments?
Mr. HOLMAN.; Yes.
-I do not think there would be wisdom or economy in having the banking propositions split up in that way. I think the advantage lies in having one concern managed by one staff.
And then we went on to criticism and interrogations which led us up a blind alley to the same kind of result as before. The right honorable gentleman, in retiring from the Conference, said to the President -
I thank you for your courtesy. I have done my best to answer your questions, although it is rather difficult to do so off-hand. I wish you luck.
That is the way in which the right honorable gentleman left the Conference, but we had no luck with him. In the speeches which followed honorable members will see that, irrespective of party or of geographical separation or identity, all the critics of the scheme laid before us pointed plainly to the undoubted fact that there was no real partnership offered. There was a proposition that we should share our fortunes and give the entire control to the management of the Commonwealth Bank. Honorable members opposite, judging by their earlier utterances, have been impressed with respect to one feature of this measure by the statement that the States were to get 75 per cent, of the new business - of the excess of deposits over withdrawals. This is a very important fact, as. was the promise of a renewal of the old business. In Victoria at the present time I think there are. speaking from memory, ?16,000,000 of the ?23,000,000 lent by the State Savings Banks to various enterprises of the Government, and the loans are constantly, or frequently, falling due. After ail, that was asking for bread and being given a stone. Had the agreement been arrived at that very year, the Treasurers of the States would have had to come to the Governor of the Commonwealth Bank for the renewal of their loans. On asking the price, they would be told 41/2 per cent. “ But,” they would say, “ the money market rate is 4 per cent.” “ I can get 41/2 per cent.,” would be the reply of the Governor, “ and cannot afford to lend for less.” The Governments and Parliaments of the States would have been mere office boys on the door-mat of the Governor of the Bank. There would have been no appeal to the Treasurer of the Commonwealth. Had it been possible for the Commonwealth Government to arbitrate and to decide the rates, my objection would not have been so great; but to give final arbitrament and control to an official with regard to the past lending and constantly accruing future borrowing of the States seemed to be undemocratic, and a bad financial arrangement. There was no promise definite and binding on anybody. The final word would always be with the Governor of the Commonwealth Bank. I have not shown how I apply this to the amendment. The third part of the amendment seeks to refer for inquiry to a Committee the relation of the existing Commonwealth, institution to other institutions. My attention has been confined to “ other State institutions,” and I hope to have proved to the satisfaction of some honorable members that there is a case for inquiry, if not for drastic alteration. I do not believe that honorable members opposite wish, by the process of strangling the States, to give greater powers to the Commonwealth. If the powers of the Commonwealth are to be enlarged, that should be done, as the Prime Minister sought on two occasions to do it, by securing the approval of the people to deliberate statutory enactments. There should not be a form of administrative pressure seeking to destroy the revenues and resources of the States, and causing them to wither, so that eventually the State powers could be assumed by the Commonwealth. We are all interested in building up the parts of the nation in order that the nation as a whole may be sound and great. Had the Commonwealth Bank been wisely founded, in the great crisis through which we- have passed, advances to institutions which needed them would have been made with ease and comfort and satisfaction. But of the £10,000,000 loan commandeered from the private banks by the Treasurer, not one penny was supplied by the Common wealthBank, showing how povertystricken is that institution amid the affluence of its competing neighbours. I hope that there will grow in the minds of honorable members opposite the desire to see the Commonwealth Bank become a bankers’ bank,, with great powers over other institutions,, and with enormous resources, so that, like the Bank of England, which recently was able to discount £200,000,000 worth of bills of exchange, there will rise a power to steady trade and finance, and to buttress other institutions against the shocks of time and chance. There is no reason why, having in view these three bases of argument, the Bill should be pushed on before inquiry as an urgent measure. What is the ground of urgency ? I see no provision in any of the clauses, and have heard nothing in the words of the Government, uttered here or elsewhere, leading me to believe that the measure should be passed into law during this calendar year. We shall meet again in April. If the Bill be referred to a Select Committee, with power to sit during any adjournment, we shall get a full inquiry, and shall then be armed with substantial data that will be of use to us. Whatever our point of view, the more we riddle this institution with the shafts of thought and criticism, the more we shall see that it ought to be reconstructed - not a reconstruction due to insolvency, but an enlargement of structure and a broadening of power in the highest and most abiding interests of the country. No proposition is made to the Government as to the constitution of the Committee.
– These amendments are not all that honorable members want.
– No; there are a number of things that we want, but do not hope to get. Our experience teaches us that we may dash our wings against the bars unavailingly, and retire hurt from the effort. In the amendments are set forth the reforms that we think to be immediately practicable. Like the Labour party, we have an objective which we have not yet published. I appreciate the attention which honorable members, especially those opposite, have given to my remarks. I have urged my arguments strongly, because I feel deeply on this question. We should give this institution at its second birth a constitution which will insure to it a strong manhood and a ripe old age.
.- The honorable member for Flinders spoke for about ten minutes in moving his amendment, and in putting my views forward, I shall imitate his brevity. The debate has demonstrated that there are, not two, but three sides to the question under discussion. It may be said that, as a party man, I must oppose the amendment, but, in any case, holding the opinions that I hold, I could not vote for it. In the first place, I could not vote for it because it is not possible for members on this side, who are pledged to definite principles, to allow those principles to be referred to a body of men who are opposed to them.
-What are those principles ?
– The principles of this party on main questions are stated in black and white, and to them we are pledged ; but, like the honorable member for Balaclava, I have not time to say everything in the period allotted to me, and I cannot make two separate statements of fact at one and the same moment. The method of ownership of this Bank is set forth ; its control is set forth ; its functions and powers and property are set forth in our platform, and to that we are pledged, and to it we adhere. I could not support the amendment, because it would refer these principles to a body of men who are in antagonism to them. But I am strongly opposed to the Bill, and I am not going to vote for it. I am not going to vote for the amendments which are proposed, because I consider that they are hostile to the principles which I support, and I am not going to vote for the Bill because it is hostile to the principles on which this party is established. That is clear and definite, and sets forth the third point of view. Were I to give expression to my thought in the language that comes to me, probably it would not be good, and I shall endeavour to emulate the modesty and moderation of the honorable member for Balaclava.
– I wish the honorable member were sincere in that respect.
– I had a friend once who was a great man in the prize ring. He had a prognathous jaw, a dirty left, and a divine right. I used to constantly take my friends to see him, telling them that they would get something for their money. They came time after time, and time after time they saw nothing. Then one of them asked, “ Is this the man you say can fight ? Why, he side-steps, feints, and shadow-spars, but he does nothing.” I am reminded of that when I listen to the honorable member. I ask myself, Am I in opposition to the Bill for the same reasons as those for which honorable members opposite oppose it? Being strongly opposed to the action of the Government in regard to the measure, is it thatI occupy the same position that they do?No. Their opposition is not based on public grounds. We have not heard a word about the enlargement of the functions of this national institution. If that is injurious to the public, it should be fought and destroyed. Honorable members opposite do not take that ground. They propose to refer the Bill to a Committee, which is a policy of delay, hut we have not heard one of them say a word as to the formulation of policy, not even in connexion with the question of capital, nor any other question. Everything discussed has been a matter of detail.
– Amendments have been circulated which show what we propose.
– They deal with details, not with fundamental principles. These fundamental principles are set forth in the platform to which the Labour party is pledged, and it is our duty to enforce them on any Government behind which we sit.
– What are they?
– I must he permitted to take my own time in formulating my argument. In the first place. I object to this Bill because it ignores a part of the programme of the Labour party, and that is, the establishment of a National Bank of issue. That is not a matter to refer to a Committee. We believe that the Bank should be a bank of issue. In 1903, as the honorable members for Flinders and Balaclava will remember, I said, when the railway strike was being discussed in the State Parliament, that a great error in all forms of government was that we did not distinguish between the political and civic powers of the State. The function and powers of a national institution should be clear and distinct from any political control and influence whatsoever. The national Government, the State Governments, and private individuals, should all approach this institution upon the same plane. Each and all of them must have clearly and distinctly the same attitude of creditors or debtors. The only hope of arriving at absolute and perfect administration of a National Bank, as with our railways, is that the Executive and the administration of these institutions should be clearly separated, and that the National Government or State Governments or financial institutions desiring accommodation should all alike approach the Bank and first deposit their securities. That being the case, I come to my next point. I object to the Bill on the ground that it clearly and distinctly violates another of the principles of the Labour party, whose programme affirms that the Bank should be owned by the people in a corporate capacity either per medium of the States or per medium of the Commonwealth.
– Or by both together.
– But what does the Bill ask us bo indorse? First of all, the transfer of control by the people bo control by private individuals; and secondly, the making of ib into a capitalist-owned institution. We are asked to compel the Bank to earn £350,000 to £4.00,000 per annum for the payment of interest, and if it cannot do so tlie balance must be paid out of the public exchequer.
– The debenture-holders will have a lien over the Bank.
– That is so; and on these grounds I oppose the measure. What has happened during the last month or two, since the outbreak of the war? The honorable member for Balaclava said that we took pride to ourselves for having freed the Bank from political influence, but that at the same time we had retained under political influence the allimportant question of the note issue. I agree with the honorable member. Who was in authority when the war broke out ? Honorable gentlemen now sitting opposite. And what took place? A Conference was held. What transpired at that Conference? We do not know. We are told that it was a secret Conference. We are told, as a matter of fact, that all the Conferences that have since taken place have been secret. Whenever we ask for information we are told that Ministers are pledged to secrecy. My idea of a pledge to secrecy in this instance is that certain language is used in. order to keep from the public all they ought to know about public business. When honorable members on theother side held their Conference, the first matter decided upon appeared in thepress. I do not put all the responsibility upon honorable members opposite. The responsibility rests equally upon every party that indorsed their policy, and since the policy of honorable members opposite has been carried OUt and indorsed by the succeeding Government, blame rests equally upon the party on this side. At any rate, as a result of this Conference, two things were proposed by honorable members opposite; and the first was that advances should be made to the States at the rate of £4,000,000 worth of notesfor every £1,000,000 worth of gold deposited in the Commonwealth Treasury. The States were to deposit £1,000,000 worth of gold and receive £4,000,000 in notes, and pay interest on the difference between the security deposited and the total notes drawn from the Treasury. But what was the security between the minimum of gold deposited and the total notes drawn from the Treasury? Was itgold? We are bold that the States were to deposit Treasury-bills. Therefore, the only security for the notes in circulation, according to the scheme formulated by honorable gentlemen now in Opposition, was the Treasury-bills bo be furnished by the State Governments bo whom the money was lent. In these circumstances I put. before the country, if it is capable of listening at this particular juncture, and before honorable members opposite and. before the present Government this position : If the Treasury-bills of the States were good enough as a basis on which to. issue a note circulation, then thebonds and securities of the National Government when deposited in the» Commonwealth Bank should be good, enough as a basis on which bo issue a< note circulation with which to form a capital for that Bank. We know verywell that the present Government haveabolished that principle so far as the.States are concerned ; bub that is another matter. What was the second arrange.went, made as a result of the Conference f The second step taken was to make advances to the private banks. The veryparty, not the Labour party, that, talked of the absurdity of a note issue - not the party that is now trembling ira the balance so far as currency is concerned, but the men who talk about having gold as the basis of everything - what did they do when they desired to assist their friends, the private bankers? They said, “ Come and deposit £100,000 in gold, and we shall give you £300,000 in notes.” What security did the banks furnish to the National Government; what stood behind £300.000 worth of notes which were guaranteed and indorsed for redemption by the Government? Nothing but the £100,000 they pub in as security. Behind the other £200,000 there was nothing so far as the banks were concerned, but so far as the public were concerned the notes were a safe issue, because they were guaranteed and backed by the whole credit of the Commonwealth. But we are bold that they were a first claim on the assets of the bank. If we look at the Economist we will see that on the 22nd August last the Sydney correspondent of that paper, speaking of the Cook Administration, said : “ They wisely adopted their paper currency, and they have come to the relief of private institutions in a magnificent manner. They are issuing to the banks three of paper to one of gold.” Then he went on to explain why the Government were doing it, and in the course of his explanation he said: “This happy arrangement permits the strong banks to stand exactly where they are, and conduct their operations Tree from the responsibility of going to the support of the weaker (or more rotten) banks.” He did not say “ rotten.” I say that. It is not so polite, bub it is more emphatic. The stronger banks were to be relieved of their responsibilities, while the weaker banks were to have the support of the nation to the extent of receiving £300,000 for £100,000 deposited, so that they could pay their obligations with the £200.000 margin. If they collapse to-morrow the depositors in these decaying and little weak banks may suffer; but we are told. “The National Government has its security, because it has a first claim on the assets of the banks.” Would any National Government, when a weak bank suffered or collapsed, endeavour to enforce its claim and let depositors suffer ? No Government would dare to do it. Yet the party that was in power and the party that is now in power support a principle of this character, and if I am asked where the capital of the Commonwealth Bank is to come’ from I say, “ The same principle that was sound enough for a note issue bo the States, and for the support of the private banks of the country, is a sound enough principle on which to capitalize and float the Commonwealth Bank.” It is proposed to issue bonds bo the extent of £10,000,000. What for? They say, “ Nothing in particular.” For whom? They say, “We do nob know.” Why? They say, “ We do not know.” What is the hurry? They say, “There is great urgency.” Are we going to buy any one out? They say, “ We do not know.” If we are going bo buy any one OUt and spend £10,000,000 in doing ib, surely Parliament, if ib is at all a representative body, should know; or if honorable members on the other side are not to know, at least we on this side should be told. I say quite candidly, “I do not want honorable members opposite to know; we are the majority, and, therefore, can silence them; but for heaven’s sake whisper it in my ear in order that I may know whether or not I can support what is proposed bo be done. Do not ask me to vote on the principle of buying a “pig in a poke.” I am not. prepared to do that. If the Bill is urgent there must be some reason for it. If there is no reason for it, then there is no need to rush the measure through at this late hour of the session. If we need any indorsement for the policy I have suggested let us remember that, the honorable member for Swan has said, “ The basis of the Bank’s capital is the credit of the Commonwealth.” That is good for Sir John. His argument is good enough for me. The honorable member for South Sydney also said, “ There is nothing better,” and most of the honorable members on this side of the Chamber said “ Hear, hear.” Why do they not say, “ Hear, hear,” to-day ? The honorable member for Swan said that the credit of the Commonwealth is all that is necessary. Then, why do we need the power to borrow £10,000,000? If we issue £10,000,000 in bonds we issue them to private individuals. Why ? In order to create a credit. For what ? To put it back into our own Bank and pay 3 per cent, or 4 per cent, upon it. I want to know why, if we could issue three notes to one pound in gold to a private bank, we should not do the same in regard to capital for the
Commonwealth. Bank? I ask honorable members of the Labour party how they are going to go on the public platform and justify the issue of three notes to one pound of gold to a private bank? Is there any reason why a private bank should have a privilege that any other private corporation has not got? Why should a private bank be exempted from ordinary treatment, or be in any way exalted in the community? Why should it have in this regard greater privileges than men hewing in the woods, or working in the mines, or tilling the fields? If a private bank can deposit £100,000 in gold and draw £300,000 in notes from the Treasury, why should not the farmer, the manufacturer, or a citizen engaged in any other industry enjoy the same privilege? I deny that the private banks should have exalted privileges as against any other institution in the country. Consider what our friends on the other side of the Chamber did when they wished to support the institutions that stand behind them in politics. However, it is not enough to condemn them. We also stand condemned when we continue the policy which they initiated. But my point is that if bonds, to the extent of £10,000,000, can be issued to private individuals, I see no reason why they cannot be issued to the National Government to form a capital for the Commonwealth Bank. I do not ask the Opposition to agree with me; I know that they will not do so, but I say that they cannot oppose my suggestion, because they accepted the Treasury-bills of the State Governments as a sound enough basis for the necessary issue of notes. Instead of issuing notes to private individuals, enabling them to make a profit out of the community, we should put these national bonds straight away into the Commonwealth Bank, and so get a capital for the institution. There would stand the bonds and the security. There would stand what the honorable member for Swan described as the negotiable credit of the Commonwealth, redeemable with all the taxable power of the community. Did not Sir John Forrest say -
The credit of the Commonwealth is sufficient for all transactions.
I accept the honorable gentleman’s argument; why should we not accept the arguments of our opponents when they indorse our proposition ? He also said -
That is the sole capital that the Bank has had from the beginning.
That is true; it has never had anything else. Those are the principles we ought to carry out. The functions of the Bank are set forth as covering the principles of exchange, deposit, reserve, and issue. Under the proposals of the present Government, the Bank is to do nothing more than an ordinary bank operating amongst private institutions. It lacks all the powers, functions, and prerogatives of a great National Bank. It is absolutely incapable of redeeming anything in a time of crisis, or of doing anything else. I have no intention of occupying the time of the House longer, but I hope in the new year there will come a time when the public mind will be more receptive, and when the party to which I belong will take a firmer stand on this question.
– Do you think your own principles are so sacred that they should not be inquired into
– Certainly. I would not hold them if I did not think that.
– How can you hold principles if they are always open to inquiry ?
– In the honorable member for Brisbane I have another supporter. Principles, it is said, are unchangeable. If I had any doubts in my mind in regard to my principles, I should go away quietly where nobody could see me and argue with myself, but I should never allow the honorable member for Balaclava to be in doubt about my principles. I am satisfied that if he were to be the judge of many of my principles I should be held to be almost always wrong.
– I think you are so fearless to-night that you should have a Victoria Cross for this address.
– I have been worthy of many things in my life, and have never got them. I am like the flower that was born to blush unseen; I have always blushed unseen. As the honorable member for Flinders remarked, this is not the time to debate these matters. The honorable member felt that it was useless to discuss this question, because not only is- his party in a minority, but Parliament is not prepared to listen to him, and the general temper of the community is not such as to allow of a calm consideration of serious propositions. Whilst I differ from the honorable member, T feel at the same time in accord with him in believing that it is largely a waste of energy to attempt to discuss this question at the present time. I have taken this opportunity of briefly stating my views in regard to the Bill. When we have seen the result of its operations, and the public have felt its effects, then possibly the people will be able to listen to other views than those to which we are listening to-day. With that I am content.
– Before the honorable member sits down, will he tell the House how he is going to vote?
– I have already told the House. The honorable” member was upstairs having his usual cup of tea, and I feel disappointed that our long friendship did not induce him to invite me to accompany him.
– I am going to take the honorable member out with me after he has finished his speech.
– It will be the first time that the honorable member has ever done so.
– I am going to congratulate the honorable member on being able to discuss the whole of the Bank’s operations, although I was prevented from doing so.
– If the honorable member invites me to accompany him to the refreshment-room, that invitation will live in my memory. I will conclude by reminding the Leader of the Opposition that I distinctly told the Chamber that I could not vote for the amendment, because the principles of the Labour party are set forth in black and white, and are not subject to inquiry even by those who are pledged to them, and, further, I am not going to vote for the amendment because it emanates from a party which is opposed to every principle of those with which I am politically associated.
.- The honorable member who has just resumed his seat has discoursed upon the wickedness of paper money; but if there was ever a time when the Commonwealth was called upon to extend its credit in the form of paper money, it is the present. The amendment before the House is -
That the questions of (et) the control and development of the Commonwealth Bank, (6) the transfer to the Bank of the management of the note issue, and (e) the relation of the Bank to State and other financial institutions be referred to a Select Committee of this House for consideration n,nd report.
I propose to deal with those three subjects seriatim, but, before I do so, I wish to advance some general reasons as to why this matter should be referred to a Select Committee. When the Bank of England was established in 1694, with a capital of £1,200,000, it had no basis of inquiry or precedents to guide it, because it was practically the beginning of banking as we know it to-day, and, as a result of the fact that there was not an ample preliminary inquiry, the bank was led into grave difficulties on various occasions. The Bank of England, as it is to-day, has been built up through a series of periods of trouble and distress. We wished to avoid that sort of tiling with the Commonwealth Bank. In modern times we have known inquiries to be made by all the nations of the world before establishing any bank which approximates to the Commonwealth Bank. When Scotland decided to establish its banks, it made inquiries in England, and later on, when England saw the success which had attended the operations of the joint stock banks in Scotland, and the influence they had in developing the country, she instituted inquiry before allowing other banks to be established throughout the counties. More recently, before Sweden instituted its bank, the Government made world-wide inquiries; and still more recently, before Austria established its great bank, it made investigations throughout the world. Germany adopted the same course.
– We want no “ Made in Germany “ Bills here.
– I agree with the honorable member; but, although we are at war with that great Empire, the honorable member will admit that there are some things which we can learn from Germany I think it is a great disaster that we should have to fight such a progressive and intelligent race as the Germans, and I see no reason why we should not benefit by inquiry into the banking history and methods of other nations which, have gone before- as along those tortuous paths which Head to financial salvation. There is no question which needs keener judgment or a nicer touch than does the financial stability of a community. We in Australia, knowing the financial insecurity which obtains throughout the world to-day, should be particularly careful in dealing with this matter. Even the Bank of England, after its long years of establishment, had, in the time of the Pitt Government, to make full inquiry . into the proper course to follow from that time onward; and it was after the presentation of the bullion report to Parliament that the bank commenced to advance to the position it occupies to-day. Even after that full inquiry, when the Act of 1844 was introduced, there had not been sufficient investigation, because, in a few years, the bank was again in difficulties. With all these historic precedents before us, we should take the little time that is necessary, especially in the crisis which at present prevails, to go into the matter thoroughly, and see if we cannot establish this Bank on such foundations that our people will not have to suffer from those financial crises which affect everybody, from the highest to the lowest. The most recent and perfect inquiry was that made by the United States of America, and any one who will take the trouble to go to the Parliamentary Library will see enough volumes produced by the United States Senate inquiry to fill him with wonder and almost awe. I know of no line of study that is more apt at the present time, and of noopportunity greater than is put before honorable members by that Library, containing all those volumes dealing with the monetary inquiry in the United States of America. It seems to me that, if a Committee were appointed, they could make inquiry throughout the business world. They could look up the history of various institutions which have gone before, sortie of them monuments of skill, strength, and independence, and study all the references in the Parliamentary Library. The Committee could then come back to the House in April and lay down a scheme which would obviate the trouble which must follow if we conduct the Bank along the lines indicated by the Bill which is now before us. I am of opinion that this measure goes in an entirely wrong direction, and I ‘hope that, before we adopt it, we shall inquire into its tendency. I desire to put before the House a few reasons why I believe this inquiry is necessary, and” which prevent us from accepting this amending Bill. In the first place, the amendment says that we should inquire into the control and development of the Commonwealth Bank. The fact cannot be too much insisted upon that our Bank is constituted in the most autocratic fashion of any bank in the world. There has never been, in the history of the financial world, such an autocratic position created as has been given to the Governor of the Commonwealth Bank. Whether the present Governor is a good banker or a bad banker is utterly beside the question. The real trouble, and the reason why we should object to the Bill, is the fact that no man in the wide world is capable of alone handling such an institution as we hope the Commonwealth Bank will become. Such a task is beyond human capacity, and we on this side of the House, and, I am convinced, a number of honorable members on the other side of the House also, hold that this autocratic domination of the Bank is against the democratic principle of the time. I believe we should constitute a Board, comprising all the Treasurers of the various States, the Treasurer of the Commonwealth, and one leading financial expert from each State, who should sit with the Governor of the Bank as a Board of directors, to consider the policy and development of the institution. To my mind, the whole future of Australia is wrapped up in the progress of this Bank. It is far more dangerous to this community than any private bank or any congeries of private financial institutions could be. Here we are to-day with this Bank extending our credit in one direction and the Treasury extending it in another, the result being that we are building up more than one credit on the one lot of property and the one set of goods. The first part of this amendment deals also with the development of the Commonwealth Bank, and it certainly opens up the widest possible field for discussion. Any one can see the possibilities of development that lie before this Bank. It has before it a future in which, if it is developed on right lines, it will not only maintain, but improve, the financial stability of the Commonwealth and the States, as well as that of the whole trading community of Australia. It will not only do the big business of the Commonwealth, the States, and the municipalities, mot only all the public business of tks State, brat, in addition, will transact private business. I do not approve of this Bank doing private business. It seems to me that it should at present confine its attention to the big business I have mentioned. If it does it will give a tremendous support to private finances, and to development throughout the Commonwealth. If it is developed along those lines, it wall earn that security which can be obtained only by having the support of the financial institutions. If the financial institutions have faith in the Commonwealth Bank, and that faith is reciprocated, as it well might be, then we shall have in our financial affairs a stability the like of which has never before been created. To my mind the Commonwealth Bank should be developed along the lines of high finance. It should become, as the honorable member for Darwin originally proposed, a clearing Bank for the other financial institutions, or, in other words, a banker’s Bank. At the same time, it should undoubtedly become a Bank of issue. That brings me to the second part of this amendment, which relates to the transfer of the note issue to the Commonwealth Bank. I believe that the present handling of the note issue is a direct menace to the financial stability of the Commonwealth. So long as the Commonwealth Bank is kept from being a Bank of issue, it must occupy a dangerous position. I propose to show how the inflated currency of today, with the double credit which we are giving through the Treasury and the Commonwealth Bank, is liable to lead to financial disaster. It has been pointed out during the course of this debate that the currency usually requisite for carrying on the trading operations of Australia is from £12,000.000 to £14,000,000. It has also been proved that under present conditions, if we carry out the promises already made by the Government, our currency will amount to somewhere between £30,000,000 and £40^000,000. Is it not certain that if it is inflated to that extent either the currency must depreciate or prices must rise enormously? The experience of other parts of the world show that there is no alternative. Whichever happens in such circumstances we are going to land ourselves in grave financial difficulty. We know from the experience of the world that the gravest troubles befall a nation when its currency depreciates. We also know that when that depreciation takes place, and until the Governmnent resumes the currency over and above that absolutely necessary for the requirements of .the community, prices must necessarily increase. The position we should then occupy is that the workers of Australia in particular, and all who had .settled incomes - those who work for a fixed wage or draw a regular allowance - would find it hard to keep their heads above water. In times of financial stringency, which occur as the result of an inflated currency, prices rise, and the purchasing power of incomes which, in ordinary circumstances, are -sufficient to provide a comfortable living, is seriously reduced. Those who are in receipt of a regular wage or allowance throughout tlie year immediately suffer, and, in some cases, suffer almost beyond description. In present circumstances, all the notes being under the control of the Treasury, and the Bank having to advance its credit to the Treasurer of the Commonwealth, we are not only inflating the currency, but doing so in a twofold sense. I wish to deal with the assets of this Bank, and to show how it is conducting its business. On examining the balance-sheet of the Commonwealth. Bank, we recognise how necessary it is that it should have control of the note issue. The Bank has very little assets with which to carry on the business intrusted to it, and what assets it has are scattered in what is, to my mind, a very dangerous way. We learn from the balance-sheet, for instance, that its money on short call in London is only £1,465,000, while the Government, according to the Treasurer, have a current account of £1.264,029; so that what the Bank owes to tlie Government is almost on a par with what it has on short call in London. In addition to that, the Bank is doing ordinary discount business which amounted last year to £1,392,000. Then it has a more extended credit to the extent of £41,025 10s. in bank notes. It is thus doing three classes of business. This, in. my opinion, is a dangerous position to be occupied by a bank while it has no security on which to fall back. It is idle to say that the Commonwealth Bank has behind it the security of the Commonwealth. Ultimate solvency is not sufficient. We must have our Bank in a position to pay cash on demand.
– That is the whole point.
– Quite so. While the Bank, to use an Americanism, is spreadeagled as it is now, it is a grave danger to its own financial stability, and, to a certain extent, to the Commonwealth itself that it should have nothing to back up its credit, If it had control of the note issue, then unquestionably it would have the financial stability of the Commonwealth at the back of it, and with these notes would be able to meet all sudden demands. I desire to go a little further into the question of the note issue, and to show how we are expanding and extending our credit, until it becomes so swollen as to be positively dangerous. The Treasurer’s financial statement discloses, in respect of the Australian notes account, the following figures: - The Commonwealth inscribed stock is £3,076,000, and the Commonwealth Bank of Australia has £150,000 in bank notes. These two sets of figures, amounting in all to £3,226,000, are in reality a double credit on the one property. That is to say, the Treasury backs these notes, hands them over to the Commonwealth Bank, and the Bank hands them over to the Treasury, and calls this process “making money.” We are told that interest on this investment is credited to the Australian notes account, and accumulated at compound interest. That seems to me to be very like trying to spin money out of nothing. If we transfer our money merely from one pocket to another, we cannot afford to pay ourselves interest on it. Yet that is the position that the Commonwealth is endeavouring to assume. It is simply moving money from one account to another, and by doing so it considers that it is creating fresh credit, and is paying itself interest upon the transaction. It is, after all, only very like the old system that led to grave financial disaster in the Old Country a good many years ago, when merchants in London drew bills on merchants in Paris, who in turn handed those bills into their banks, and drew practically the same amount on the merchants in London. The bills were presented in London, and there was thus a double credit on the one set of goods. That led to grave financial disaster. Unless we mend our ways in Australia, it seems to me we shall have trouble. If we go on in this way building up a double credit on the one property, and paying ourselves compound interest on the transaction, we must run ourselves into serious financial difficulties. In order to avoid that sort of thing, we should do away with these transactions in notes between the Treasury and the Commonwealth Bank. We should give the Commonwealth Bank full and complete control of the note issue. At present tlie position is very like that of a coach with two men on the box-seat, the one holding the reins and the other the whip. So long as the road is level and smooth and true no trouble is experienced; hut as soon as any turn in the road or rough place is reached, it is absolutely necessary to hand the whip over to the man who controls the reins. That is precisely the position in connexion with the issue and control of the Commonwealth notes and the Commonwealth Bank. We have on the box-seat a driver holding the reins and another man holding the whip, and the man who is controlling the whip will often use it at the wrong time. In such circumstances as soon as we are confronted with a difficulty - and we are facing difficulties now - we are apt to land ourselves in a position of grave danger. The State Savings Banks, before the institution of the Commonwealth Savings Bank, were doing, and are still doing, effective work in the way of stimulating production and internal development generally, a.nd nothing is more necessary than such encouragement and stimulation at the present time, in view of the fact that the outposts of the Empire will be looked to to supply the necessaries of life to the older countries in the hard times that are inevitable. This Bill puts the Commonwealth Bank in opposition to the State banks, and the result must be that waste which always follows unnecessary competition. In New South Wales the Advances to Settlers Act, which is a direct outcome of the State Savings Bank, has proved most beneficial, and many proofs of this came under my notice when I had the honour of a seat in the Legislative Assembly of that State. I remember there was one case in which I found that a settler, who expressed to me a desire to take advantage of the legislation I have mentioned, had been paying a private financier 16 per cent, for his advances, while the rate charged under the Act where I got him placed was 4^ per cent. Struggling selectors, farmers, and other small holders have been benefited largely in this way, not only in New South Wales, but, I believe, in all the States of the Union; and it is a serious matter when it is proposed to set up the great Commonwealth Bank in opposition to State institutions which, in this regard, are productive of so much good. There is any amount of scope for the Commonwealth Bank in the broader and higher planes of finance - there is plenty of work for it in connexion with the banking business of the Commonwealth, the States, municipalities, and other governing instruments throughout Australia
– The honorable member said that he wished to see the Commonwealth Bank like the Bank of France.
-. - And I say so now. I wish to see the Bank in a position so sound as to remove any fear of its being shaken by a crisis however serious. The Bank of France does more good than any other bank in the way of helping small holders, and there is nothing to prevent the Commonwealth Bank from doing similar work; but there is no reason why it should enter into competition with “the Savings Banks, and thereby reduce the ability of the States to assist in the stimulation of production. There is no doubt that the control of the note issue should be handed over to the Commonwealth Bank. There is always a clanger when the control is left with the Government, because it may lead to the credit of the country being swollen by political exigencies. This, of course, would be highly dangerous to the stability of the Bank and the Commonwealth itself. On the other hand, if the control of the notes were with the Bank, those responsible for its management would know exactly how far it was safe to go, and could arrange the business accordingly. In the financial world there is no more difficult operation than fixing the rate of discount; and yet we have the Bank trying to do business without really knowing either the financial position of the Commonwealth or its own financial position. Until the Bank has control of the note issue, and knows exactly what advances it can make on its notes and its credit, there will be danger.
– The honorable member is dealing with the internal working of the Bank, and I must ask him to confine himself to the question before the Chair.
– I was endeavouring to show that, unless the Bank has control of the notes, it is not in a position to know how it stands.
– I have already allowed the honorable member ample latitude, but he is now, as I say, discussing the internal working of the Bank, which has nothing to do with the question before the Chair. The honorablemember spoke on the second reading at considerable length, and I cannot allow him to cover similar ground again.
– I have tried to take care not to cover ground that I traversed in making my second-reading speech. In my opinion, the development of the Bank is entirely in a wrong direction. I regard the Commonwealth Bank as necessary, to serve as a clearing house to the other banks, and to give finance and commerce that stability which undoubtedly a properly-managed National Bank can give. But to attain that end, the Bank will have to be conducted on different lines from those laid down in the Bill. It should now be directing its attention to the higher finance, whereas the Bill, if it becomes law, will reduce the status of the institution and destroy, with possibly disastrous results, its latent possibilities for buttressing the finances of the Commonwealth.
.- I agree with the proposal put forward by the Government, and I cannot follow the honorable member for Bourke, who has chosen to take another course. Whe”n the Bank was instituted, I thought that, as a principle, it would be better to have in the management several men, or something in the nature of a Board. At the same time, the experience we have had of Mr. Miller goes to show that he has done very well indeed. He is certainly an able man who, however, is not too big. He does not depend entirely on his own initiative, or despise the advice and opinion of his qualified subordinates. We all know that a nian who turns his back on such advice very often makes mistakes. We cannot always, however, obtain the services of men of sufficient calibre to act alone, and, as a principle, I am still of opinion that it is better to vest several persons with the powers of management.
– We might as well have one man to govern a country!
– Benevolent despotism might prove a very fine thing if we were always sure of a benevolent despot. When we think of such men as have created the European disturbance, we are more than ever convinced that it is unsafe to leave the government of a country in the hand’s of one individual. As to entering into a partnership with the States, I thought at the beginning that it might be wise to arrange for a joint control, but I am not so- sure of it now. Upon due consideration such an arrangement seems, to be fraught with possibilities of friction. Friction cannot be prevented now, although, the separate spheres of the Commonwealth and the States are defined fairly clearly. If the two sets of authority were intermixed in the joint management of such a debatable question as finance, there would be the possibility of more trouble. Moreover, the arrangement would tend to establish the integrity of the States rather too firmly on its present basis. I believe that there will vet be a re-adjustment of the relations of the Commonwealth and the States, and probably the creation of a number of smaller States; but that is a matter for the future. As’ to the argument of the honorable member for Wimmera, that the Commonwealth Bank is not the little man’s bank, it sounded to me like the argument of the man in the street who, not seeing clearly how to get things, expresses wishes that are father to the thought.
– I said that the Commonwealth Bank had lamentably failed to assist the small farmers.
– Tlie Commonwealth Bank was not intended as a farmers’ bank.
– That was promised.
– Not in conjunction with the establishment of a National Bank; it would be a different department, and run on different lines. In my opinion, it is run most advantageously at the present time by the Savings Banks of the States, and when the Commonwealth deals with the matter it will be by means of its Savings Banks. How could the National Bank become the bankers’ bank, if its functions were multiplied, and its operations made too intricate for any one man to manage? At the outset, I was opposed to the establishment of the Commonwealth Savings Bank, thinking it better to leave the control of the Savings Banks to the States. I still think that that would have been best. But I do not advocate the closing of the Commonwealth Savings Bank. The Governor of the Bank has shown tact and good judgment in not entering into a twopenny-half-penny competition with the Savings Banks of the States. He has not inflated his rates of interest, but, on the contrary, has kept them below the State rates. Yet, notwithstanding, the business of the Commonwealth Savings Bank has increased1 considerably.
– It advertises freely.
– That shows good business, management. Advertising is surely not to be prohibited in regard to a business concern. Being in . business the Governor of the Bank cannot be blamed for adopting the most up-to-date and legitimate methods of securing customers. If he were taking business from the States by making use of his stronger position he would be open to censure, but he has not done that. He has left things with the people themselves, who have been told squarely and plainly what the situation is. It is also to his credit that he has not made any odious comparisons. I think I would prefer the Savings Bank business to be left to the States or conducted wholly by the Commonwealth. The present arrangement tends to friction which is created quite often enough otherwise. Savings Bank business is not the safest form of banking business because all the money must be at short call. The money in the Savings Banks is supposed to be available at any minute, but those who control the banks are placing it out for unduly long periods. They could not meet their obligations at a few days’ notice if the money had all to be -called in, and thus those whom we most desire to protect would be hit hardest should a crisis arise. We have to be thankful that no crisis has arisen, that the Government has established confidence. Prudent bankers do not consider it wise to have all the Savings Bank money out as it is ; the money should be at short call, ready at any moment that it may be wanted. The honorable member for Bourke denounced the Ministry for indorsing the action of the Prime Minister in financing the private banks by giving them £3 worth of paper money for every £1 of gold lodged in the Treasury. I think that that was a splendid thing to do. If the honorable member for Bourke will reflect on some of his utterances, and will remember that these banks are largely owned by persons who could not afford to lose their capital, persons who, having made a just competence, depend on the earnings of the banks for their income, he will admit that it is the duty of the Government to see that these institutions are not allowed to collapse. If, by financing them, the Government can sustain the banks, so much the better. This is not the first time in the history of Australia that a Government has had to come to the rescue, of the private banks, but never has it been done in a more decent, business-like way. It is to the honour and credit of this Government that it has been able to cultivate and maintain such a good feeling with the banking institutions. This is not the time to attack those institutions, even did they require extermination, which they do not. Whatever is bad in them is due to a system which cannot be altered by any haphazard parliamentary action. I am heartily in accord with what was done. The honorable member for Bourke said that our credit was good enough to back up the private banks, and, therefore, should have been given to back up our own operations. In a sense, that is true, but the national credit is a reserve force not to be exploited lightly. It is good, strong, and reliable, but it inspires confidence only because we do not abuse it. The British Government may come to the rescue of the Bank of England at a juncture like this, and do splendid work, because every one has confidence in that Government. It is not notorious for loose financing; its credit is good. If it had strained ite credit on mortgaging its future, it would not be in as high repute, and it could not have achieved such splendid results. The issue of paper money and the creation of wealth are not synonymous terms. We may issue as much paper money as we like, but it would not constitute wealth, and it would be dangerous to force it into circulation unless wealth were created to justify it. We can anticipate the creation of wealth by the circulation of paper money only to a limited degree. It must be represented by created wealth, when put into circulation, to be sound. We could all be loaded with paper money, but if no wealth were being produced, it would be useless. This Government at the present time has gone as far as it is wise in that direction. The honorable member for Bourke would, perhaps, suggest the financing of our war expenditure by the issuing of paper money. Could we safely issue £40,000,000 of paper money to meet our war expenditure? I say that we could not. Ultimately the paper would have to be represented by gold. It might do for a while, but, instead of gold accumulating in the banks, notes would accumulate. They wouldbe of no value outside Australia. The various parts of the world are so interdependent that no country lives to itself alone, and the weakness of a big issue of paper money would be seen as soon as external trade demanded the transportation of wealth in exchange balances. A paper currency has to be handled delicately. The Government proposesto amend section 53 of the Act to increase the capital of the Bank from £1,000,000 fo £10,000,000. Hitherto this Bank has existed on credit only, but what we have done has been successful. Probably most of the £10,000,000 will be takenup by the Commonwealth itself. But there is no good reason why the people, who own the Bank, should not be allowed to invest their savings in it. Shortly after the Government of England had guaranteed the Bank of England, they said to the people, “ We want so many hundred millions of pounds for the war; will you lend it to us? It is of no use to depend entirely on paper money, because that would have to be redeemed sooner or later. What we require is real wealth, not fictitious wealth.” The money that was wanted was forthcoming. Our Government, while it may virtually underwrite the £10,000,000 loan to the Bank, is giving the public the opportunity to subscribe, and it is an opportunity which will be readily availed of by many persons, the investment being thoroughly sound. There is an idea that a selfcontained community may safely use paper money as a measure of wealth. No doubt the smaller the sphere in which this method of financing is carried out the sounder the position. But it has been pointed ‘but that quantitative changes make qualitative differences, and when you apply the method to a big sphere you get trouble. We cannot confine the system to ourselves alone, commerce and exchange being so intermixed throughout the world. As for the argument of the honorable member for Robertson, that the Commonwealth Bank should control the note issue, I do not agree with it. Control by the Government means a more flexible note issue, and whenever a crisis occurs such as the present one - although it is not very probable that it will be repeated - the representatives of the people and the responsible administrators of the country’s affairs should control the volume of the paper money. Leaving it entirely to the Bank to measure and assess the people’s wants would be more unsatisfactory than the present method. Therefore, I hope the Commonwealth Government will retain the control of the note issue. The Commonwealth Bank does not do all the banking for Australia, and it cannot know everything - of course its management may be guided by Ministers, hut if the control of the institution is to remain in the hands of one man, and the volume of the paper money were also to be regulated by him, the position would he unsatisfactory. The better method would be to have a board of men in- close contact with the affairs of the country controlling the Bank, with the Government of the day - with the credit which is there to be availed of, but not played with - coming in at any critical time to do all that is necessary to furnish the paper currency.
.- Will the Minister consent to an adjournment of the debate?
– No; I think we had better let the debate proceed.
– Although we are on the eve of Christmas, Ministers are not dis posed to meet us in the slightest degree.. I do not rise with any idea of stonewalling. That is a charge which can never be laid against me. We are indebted tothe honorable member for Darwin for theinformative speech which he gave us upon this subject to-day. While I was listening to him I felt that it was a great pity the party opposite did not establish theCommonwealth Bank on the lines he advocated in Brisbane, where, of course, it is known there is a considerable amount of wisdom.
-I cannot understand how the present Bank came to be established in defiance of the Caucus.
– lt is difficult to understand. If the advice of the honorablemember had been followed, we should have had a truly National Bank, whichcould and would have taken a leading part in the arrangements lately made for the purpose of helping the Commonwealth through the financial crisis that overtook us in consequence of the outbreak of war. I was disappointed when the honorable member for Macquarie did not conclude with the declaration that he would support the amendment, because he made a number of admissions which should render the investigation for which we are asking extremely desirable. For example, the honorable member admitted that at one time he held the opinion that the control of the Bank should not be placed in the hands of one man, and apparently the honorable member is still of that opinion. Also, if I understood him aright, he was inclined to think that there should be a board of advice or board of control, and finally he held that some arrangement by which the friction caused by the establishment of the Savings Bank branch could be got over would be advisable.
– Quite right.
– The Bill proposes to acquire other Savings Banks, and so extend the very thing to which the honorable member is opposed.
– I do not care where consolidation comes from so long as we get. it.
– To get consolidation in the terms outlined in the Bill must mean the ultimate wiping out of the State Savings Banks, which would cripple the States immensely. For instance, in Queensland the State Savings Bank assists settlers to pay off mortgages to private individuals and private institutions where the rates are high, and to buy stock and improve their farms. Under the Workers Dwellings Act, it assists men, principally working men, to build houses, and in that way live in their own homes; and the scale of redemption makes the amount they pay a very light rent. The Savings Bank money is also used for the purpose of building railways into farming and pastoral districts. The bank is also very useful in times as a buttress to the Government when they are in need of temporary financial assistance. If the extension of the Commonwealth Bank operations is not checked, the Savings Banks, in time, must necessarily be crippled. I do not see how they can escape. So far the Commonwealth Bank has not done much harm to them. It has obtained a -certain amount of money, but I think if we could get at the figures we should find that a great deal of the money which has been deposited in the Commonwealth Savings Bank, despite the lower rate of interest paid, has been placed there by men who have already exceeded the Interest-earning limits allowed by the State Banks. In fact, I account for the Commonwealth deposits almost wholly in that way. In the State Savings Bank in Queensland one cannot earn interest on more than £500, and if a person possesses a larger sum, instead of allowing the surplus over £500 to lie in the State Savings Bank, he may deposit £300, if he has that amount, with the Commonwealth Bank, and so reap the advantage of the interest. I think it would be much better if men would invest their money themselves by entering into farming or pastoral business, instead of leaving the money in the hands of the banks and letting the banks take the responsibility from them. E will not go so far as to say that the Commonwealth Bank, by entering the Savings Banks field, has not been of some assistance to Australia. For example, it has been the means of securing for depositors privileges which they did not previously enjoy. But, unfortunately, this result has been attained by making our own State banks more expensive to work than they were previously. The fact remains, however, that we have derived some advantage. But that circumstance does not constitute an argument why the competition between the Commonwealth Bank and the State banks should be increased and extended as is now proposed. I admit that the general manager has achieved a certain amount of success. Certainly he has achieved more success than the manager of a private bank would be able to do. But I venture to say that, in no part of Australia would a private bank, controlled by one man, win a large” amount of confidence from the public if it were known that he was not subject to the control of a board of directors.
– The directors are only ornaments - a sort of advertisement.
– I know that is the stock explanation of my honorable friend in matters of this kind. The men who are chosen by the shareholders of banking institutions as directors are, of course, mere figureheads, who do not know as much as does the honorable member for East Sydney. When a comprehensive Banking Bill is submitted for our consideration, I hope that it will contain such an amendment of the law as will render it absolutely impossible for any bank in Australia which is controlled and managed by only one man to obtain a charter. One of the conditions imposed upon the granting of such a charter should be that the Bank must be controlled by a board of directors. I am greatly surprised that the Government, when they had an opportunity to do so, did not take advantage of the change which the Americans have recently made in this connexion. Some eighteen months ago the whole question was before them, and Congress then passed a Federal Reserve Bank Bill, one of the cardinal features of which was that these banks should be managed by a. board of directors. From the Quarterly Journal of Economics I gather that -
Each group of banks is to choose two directors; a Class A director, who is to be an active banker representing the stock-holding banks, and a Class B director, who must be actively engaged in commerce, agriculture, or some other industrial pursuit in his district.
It will be seen, therefore, that the Americans recognise the advantage of having men of experience to assist the manager in the management of a bank. These Federal reserve banks possess very large powers. Indeed, they approach very closely the standard which we should like to see the Common-wealth Bank approach. Honorable members opposite must not run away with the idea that we are opposed to a Commonwealth Bank. We are not. But we want such an institution to be a real National Bank, and one which enjoys the confidence both of the States and of the Commonwealth. The Quarterly Journal of Economics, speaking of this matter, says -
Tlie Federal Reserve Banks are to exercise wide powers, and would seem likely to have ample resources. The country is to be divided into not less than eight nor more than twelve districts, in which a Federal Reserve Bank is to be established. All National Banks are required, and qualified State banking institutions are invited to subscribe to the capital of the Reserve Bank of their district. Subscribing banks to be known as member banks, are required to keep a part of their reserve with their Federal Reserve Bank. These banks will presumably receive most, if not all, of the general funds of the United States Government. They will provide an elastic currency issuing notes secured by their commercial assets. They are .also empowered to undertake the business of selecting and clearing checks throughout the entire country, thus providing an organization for making settlements between banks in different places, the lack of which has been one of the most serious defects in our banking system. Each Federal Bank will be a Central Bank for the section of the country which it is to serve. It will have all of the responsibilities, and most of the powers of Central Banks in the various European countries; but, largely because the system is to be superimposed upon a fully-developed banking system, some important provisions of the Federal Reserve Act, are unlike anything to be found in European legislation. The Federal Reserve Banks are to receive deposits from the Government and from member banks only. Ordinarily they will lend to member banks only. All European central banks, though the bulk of their business is with banks and bankers, may mal with the general public, and do so.
These Federal reserve banks have the right to issue notes ; but those notes must be backed by a 40 per cent, gold reserve. That is an interesting circumstance to remember, in view of the contention of honorable members opposite that a lower reserve is sufficient. It is strange to me that the Commonwealth Bank should have ignored the experience of America in tl is matter. The change which was made in that country, I gather from the publication I have quoted, was not made until after the most careful and comprehensive investigation had taken place. But here it has been determined that we shall pursue the lines upon which the Commonwealth Bank was originally started, notwithstanding that, so long as we do so, we shall not he able to obtain a truly national bank. Reverting again to the question of Savings Banks, I would point out that in Australia, no matter what party may be in power, there is a very strong objection to the Commonwealth Bank interfering with State banking business. In this connexion let me instance the case of Mr. Scaddan, the Premier of Western Australia. No one will accuse him. of being hostile to the Commonwealth Bank. On the contrary, he is distinctly friendly to it. Yet at the Premiers’ Conference quite recently, in speaking on this very question, he said -
I suppose if we do our business with the Commonwealth Bank we will get exactly the same terms as we get from any other bank.
Sir Richard Butler. ; It means a great deal to the Commonwealth Bank.
Mr. SCADDAN. ; That is true; but tlie people of Australia will ask, what does it mean to disconnect the Savings Banks from the National Bank. As I said at the last Conference, it is not so much a question of who is to manage the Savings Banks as a question of who is to get control of the State Savings Banks funds, and I object strongly to one person, controlled by the Federal Government, getting charge of the funds. . . We should be partners in the Bank. . . I think even now the Federal Parliament would, in its wisdom, agree to some such proposal. I am certain that the people of Australia would accept that proposal in preference to a proposal for breaking the Savings Banks and the Commonwealth Bank away from each other, and having the Savings Banks of the States operating outside the National Bank altogether. I believe they can operate satisfactorily from tlie point of view of the Commonwealth and the States as well, if we can only get a proper system of management. However, I object to one man being held the only authority in Australia to deal with the investment of funds belonging to the people of the whole of Australia.
– He has changed his opinion now.
– I think that statement covers the whole question. We have heard nothing from members of the Opposition that is an answer to Mr. Scaddin’s objection. For the reasons I have briefly given I shall cordially support the amendment. An investigation on the lines proposed must certainly place us in a better position than we are in now to decide the question. I hold, also, that it is an exceedingly dangerous proposal to give the Governor the right to purchase other banking businesses. That power ought to be safeguarded much better than it is in the Bill. I notice that one condition is the approval of the Treasurer, but that is not sufficient. In a matter of this sort it is of the greatest importance that we should have a board of directors, comprising level-headed’ business men, who can by their own practical knowledge and business experience appraise the terms of the proposed purchase. I do not know that it is advisable that the Commonwealth should engage in the ordinary banking business which has been so well done by the private banks. It would be much better if the Commonwealth Bank confined itself to the operations that are covered by the Federal Reserve Banks in America. If this amendment tends to bring that result about it will be of distinct advantage to the people of Australia.
.- May I ask the Minister for the adjournment?
– The night is young yet.
– I cordially support the amendment moved by the honorable member for Flinders. My reason for doing so is that we have now had three years’ experience of the Commonwealth Bank, and, without wishing to say anything derogatory to the institution, I do not think that any one can declare that the Bank has so far been satisfactory, or fulfilled the aspirations of any section of the community. It has not the machinery and business which would constitute it a truly National Bank, nor has it fulfilled the anticipations of its supporters in helping the small man. The fault of the structure of the Bank is that it is a hybrid kind of institution. By the inclusion of a savings bank branch, it has endeavoured to become a bank which will lend small sums to small borrowers, and thereby constitute itself what its supporters are pleased to call it, “The People’s Bank.” Even in that respect it has lamentably failed.
– Order ! The honorable member must confine himself to the amendment.
– I am supporting the amendment, and am showing as one of the reasons for the inquiry that the Bank, after three years’ operations, has not fulfilled expectations.
– The honorable meber has already spoken on the second reading, and he is now attempting to make another second-reading speech. That I will not allow.
– There is every reason why this Bill should be referred to a Select Committee, which should have power to investigate all the different matters mentioned in the amendment. Those matters include, necessarily, an investigation into the operations of the Bank up to the present time, and also the ascertaining of how far the note issue has been a success under the present political management, and whether it might not better serve greater and more important purposes if it became part of the functions of the Bank. We desire to inquire, also, as to whether the Savings Bank has proved a sufficient success to warrant its continuance, or whether it would not be advisable to divorce the Savings Bank business from the Bank and return it to the various States where it has been conducted with eminent success. Those are all cogent reasons why this question should be submitted to a Select Committee. So far the management of the Bank-
– The honorable member is now trying to get away from my ruling. That he must not do.
– I would like to draw your attention, sir, to the first paragraph in the amendment, which speaks of the control and the development of the Commonwealth Bank.
– The honorable member is deliberately trying to get behind my ruling.
– I am not doing anything of the kind.
– The honorable member is doing it deliberately, and I ask him not to continue in that strain. He must confine himself to the reasons why he is supporting the amendment. I did not prevent the honorable member doing that, but he is now going beyond that, and I ask him to confine himself to the amendment.
– I rise to a point of order. I submit that the honorable member for Wimmera is perfectly in order in covering the whole subject of the amendment, and in speaking upon each of its three divisions, provided that he addresses his remarks to them. I submit that, notwithstanding what the honorable member may have covered in his speech on the second reading of the Bill, he is permitted under our Standing Orders to speak at length, on the “control and development of the Commonwealth Bank,” and to adduce reasons in connexion therewith to support the reference of the Bill to a Select Committee. The honorable member is also at perfect liberty to refer at length to “the transfer to the Bank of the management of the note issue,” and to show how that would affect the note issue. Then with respect to “the relations of the Bank to the State and other financial institutions,” the honorable member may refer to the relations of the Bank in any way he pleases.
– Will the honorable member state his point of order 1
– My point of order is that the honorable member for Wimmera is quite in order in discussing at length the different sections of the amendment, and it is not possible for you, sir, under the Standing Orders, to limit debate on those three sections.
– I ruled that the honorable member for Wimmera was distinctly out of order, at the time I called him to order, and there is no point of order in what the honorable member for Richmond has now said.
– Then, sir, I must distinctly disagree with your ruling.
– The motion will be taken to-morrow. Will the honorable member for Wimmera proceed ?
– The honorable member cannot proceed until the point of order is stated.
– I do not think the honorable member can proceed whilst a point of order is being taken.
– The honorable member will permit me to explain. In this matter there can scarcely be a point of order taken. It is a question of relevance. I may be wrong or I may be right in my ruling, but when the honorable member for Wimmera was speaking I ruled him out of order on the ground that he was covering a portion of the speech he had already delivered on the second reading of the Bill, and that what he was saying was not relevant to the amendment. The honorable member for Richmond raises a point of order on the ground that tlie honorable member for Wimmera may discuss this, that, and the other upon the amendment. In my opinion, that cannot be done, and. I am not prepared to allow it to be done.
– The honorable member for Richmond desires to disagree with your ruling. Even if that ruling be right, the honorable member, under the Standing Orders, is entitled to state his objections to your ruling in writing. Until they are so stated I submit that it is out of order to permit any other business to proceed.
– Perhaps the honorable member is technically right. I was trying to conserve the time of the honorable member for Wimmera, whose time in discussing the amendment is limited. I was prepared to accept from tlie honorable member for Richmond a motion to disagree with my ruling when he submitted it, and, in the meantime, I called upon the honorable member for Wimmera to proceed. If the House does not desire that that practice should be followed, I shall await the honorable member’s written statement of his disagreement with my ruling.
– I think, sir, that we should have a quorum present.
– There is a quorum present. The honorable member for Richmond has handed to me a written statement which I cannot accept as implying a disagreement with my ruling, though it doubtless expresses what is in the honorable member’s mind. The honorable member’s statement reads -
I desire to disagree with Mr. Speaker’s ruling that the honorable member for Wimmera is out of order in referring to the control and development of the Commonwealth Bank, the transfer to the Bank of the management of the note issue, and the relations of the Bank to the St::ie and other financial institutions, when speaking to the amendment moved by the honorable member for Flinders on the second reading of the Commonwealth Bank Bill.
I may point out that whilst the honorable member for Wimmera was referring to all these subjects I permitted him to continue, but when he went into details of the Bank, which were evidently not necessary to show why this Bill should be referred to a Select Committee, I ruled him out of order. I cannot accept this statement from the honorable member for Richmond as a notice of disagreement with my ruling.
– On a point of order, let me say that I think it is just as well to have matters cleared up. Perhaps it would save a lot of unpleasantness on your part, and on ours too, if we could have the limitation of this debate prescribed for us. I take it that an honorable member who has spoken to this amendment, but has not spoken on the second reading of the BiU, will, when the amendment has been disposed of, be entitled to take part in the secondreading debate?
– It is not usual for the Speaker to explain these matters. The practice has grown up in this House that when a member has spoken to the main question he is compelled, when speaking to an amendment subsequently moved, to confine his remarks to the amendment. When the honorable member for Bourke spoke, he was allowed a greater latitude than would be allowed to an honorable member who had already spoken to the second reading, because he had not spoken to that question, and I would have taken it that he had spoken to the amendment as well as to the motion for second reading, and he would not have been allowed to make a second speech. That is a practice which has grown up in the House since its inception. My conception of the Standing Orders is that when a question is before the Chair the honorable member who is speaking shall speak to that question. But when an amendment is moved the proper course, in my opinion, is that the honorable member speaking shall be confined strictly to the amendment. The practice in the House is far different from that to which I was used in another place. I am following the practice which has been adopted here. If an honorable member has already spoken to the motion for a second reading, and an amendment similar to that before us is moved, and rises to speak a second time, surely it is only common sense that he should be confined strictly to the question before the Chair. If the honorable member for Henty had received the call instead of the honorable member for Wimmera he would have been allowed a much larger degree of latitude than the honorable member for Wimmera, simply because he has not yet spoken bo the second reading. In these circumstances the honorable member for Parramatta must see that I must try by some means or other to confine the debate within legitimate limits. If I did not do that, a dozen or twenty amendments could be moved one after the other with the object of allowing more secondreading speeches to be delivered. In the exercise of my functions I am called upon to limit debate as far as I possibly can, with due regard, of course, for liberty of speech.
– On a point of order, sir, do I understand from you that the honorable member for Bourke, for instance, would be allowed to deliver a second reading speech after the amendment is disposed of?
– He will not be allowed to speak again - on the second reading ?
– No. The honorable member has finished his discourse so far as the two questions before the Chair are concerned.
– If that is so, sir, I submit that the practice needs altering in some way or other. How can there be a relevant debate on an amendment where an honorable member may discuss the original proposal while others are confined strictly to the terms of the amendment? There can be no proper debate when an honorable member may discuss a proposal which another honorable member is not even allowed to refer to. That surely cannot be right.
– I point out bo th honorable member that I am only adhering bo the practice which has been followed from the inception of the House. I personally have nob always agreed with the practice; but I, like other members, have fallen in with it, and am now carrying it out from the Chair. Whether it is a good or bad practice is not for me to say. The honorable member for Bourke had nob spoken bo tlie second reading, and, therefore, he was allowed more latitude than was permissible bo those honorable members who had already spoken.
– What about the honorable member for Balaclava?
– I followed that honorable member very closely.
– He went into the fullest details.
– I followed the honorable member for Balaclava very closely indeed all through his speech, probably more attentively than did any other honorable member, with that particular point in view. . During the whole of his speech - once or twice. when I called him bo order, he came back bo the point to which I thought it was necessary for him to come - I never allowed him to go into small details such as I allowed the honorable member for Bourke to discuss.
– On a point of order, sir, would it not be in conformity with your wish to let the House adjourn for halfanhour, so that we might have supper?
– The honorable member for Wimmera.
– I rise to order, sir. I Understood you to say that you would not accept my motion to disagree with your ruling.
– I cannot.
– I would like to know, sir, if it is not my province to state in what way I disagree with your ruling. I understood you to rule that the honorable member for Wimmera could not refer to the subjects I mentioned in my motion, and I disagreed with your ruling on that ground. If I am in error in what I understood to be your ruling, I presume that the error could be pointed out when we came to discuss the motion; but I submit that I am entirely the judge of the particular reasons why I disagree with the ruling. I think, sir, that in the circumstances you are obliged to accept my motion, and allow it to be discussed by the House on the next day of sitting.
– The honorable member will discover after he has been in the House a little longer, though he has been here long enough to know it now, that he is not the sole judge in this matter, but somebody else is. I did not give a ruling similar to that which he has stated.
– That is a matter of argument.
– In those circumstances, I cannot accept the motion; but if the honorable member desires to amend it he is at perfect liberty to do so.
– Mr. Speaker-
– I cannot allow the honorable member.
– I rise to order-
– Will’ the honorable member resume his seat? The honorable member for Wimmera.
– On a point of order-
– The honorable member for Wimmera.
– On a point of order, sir.
– The honorable member for Wimmera.
– Chair! Chair!
– I rise to order.
– Order! Will the honorable member resume his seat?
– Yes, sir.
– For a considerable while the honorable member for Wimmera has been deprived of a portion of his time. A number of points of order have been taken, and the honorable member for Parramatta knows that it is not right to be continually asking the Speaker to give a ruling on a hypothetical case. I call upon the honorable member for Wimmera to proceed.
– I rise to a question of privilege. I submit, sir-
– The honorable member will resume his seat.
– Sir, I rise to a question of privilege.
– The honorable member for Wimmera.
– Go on ; you can rise to a matter of privilege.
– I rise to a question of privilege.
– The honorable member will resume his seat. The honorable member for Wimmera.
– Go on.
– I rise to privilege.
– I name the honorable member for Richmond for disregarding the authority of the Chair.
– I have my rights in this House.
– You have not’ any rights.
An Honorable Member.-
– You are gloating over this, are you not? You are in the seventh heaven of delight.
An Honorable Member.-
– I rise to order, sir. I call your attention to the conduct of the honorable member. I submit that it is unseemly, and that he has no right to be gloating over a ruling you have just given and a decision you have just taken.
– I point out to the honorable member for Parramatta that he must not be insulting to the House or to me.
– Who is insulting?
– The honorable member is distinctly insulting, and, further, he has no right to get up and chastise any honorable member. I do not know what words an honorable member has uttered, but if he has done wrong it is for me and not for the honorable member for Parramatta to take action.
– All that I did was to call your attention to it.
– Will the honorable member resume his seat?
– In the temporary absence of the Prime Minister, 1 suggest to the honorable member for Richmond that he should withdraw what he said-
– And apologize.
– I do not know whether the Speaker desires an apology. That is usual in all cases of this kind.
– Not all. I can remember one. I was not asked.
– It is usual. I suggest that, at this season of the year, when we are within a few hours of the termination of the session, at any rate, for this year, the honorable member for Richmond, in order to avert any difficulty, should withdraw what he said, and, if the Speaker desires an apology, apologize for what he has done.
– Is he not within his rights in raising a question of privilege under standing order 283 ?
– The Speaker, I take it, is the judge.
– He is not the judge ; the Standing Orders are the judge.
– Who interprets them ?
– The Speaker, so long as the House permits him, and only so long.
– I might point out that the honorable member for Richmond rose to address himself to a question of privilege, and that before he had the opportunity of saying what it was the Speaker named him.
– The honorable member for Flinders must not interpret what I do. It is not a fact-
– It is a fact, all the same.
– It is not a fact. Several points of order had been taken, and the discussion had. got to such a stage that it became a wrangle between myself and honorable members. I decided to stop it, and called on the honorable member for Wimmera to resume his speech. The honorable member for Richmond rose to a point of order, and I told him that he must not do it. Afterwards he rose to a question of privilege, and I asked him to resume his seat twice or thrice. He still persisted, and even the honorable member for Parramatta told him to persevere, so that the honorable member for Flinders must not take these points.
– Mr. Speaker-
– There can be no further debate.
– I rise to a question of privilege.
– Chair !
– Howling dingoes.
– There can be no further debate. There is a certain matter before the House, and it must be settled.
– I rise, sir, under standing order 283.
– Will the honorable member resume his seat?
– This is red hot. Why do you not apply the “ gag “ ?
– As honorable members know-
– On a point of order.
– Order ! Will the right honorable member for Parramatta resume his seat?
– As honorable members know well, the rule is that when Mr. Speaker names an honorable member, it is my imperative duty to support the Chair.
– When it is right.
– I would appeal to the honorable member for Richmond, whom, I understand, you have named, sir, but if he has contumaciously left the Chamber
– The honorable member for Richmond had not an opportunity to state his point of order.
– My duty is to carry out the rules of Parliament.
– Surely an honorable member who rises to a point of privilege should have an opportunity to state that point of privilege.
– I am bound to uphold the authority of the Chair-
– Right or wrong?
– While I hold my present position. Had the honorable member for Richmond remained in the Chamber I should have appealed to him.
– Appealed to him for what?
– In support of your ruling, Mr. Speaker, I have to move -
That the honorable member for Richmond (Mr. Greene) be suspended from the service of the House during the remainder of the sitting.
– The question is that the motion be agreed to.
– On that question, sir-
– Order !
Question put. The House divided.
Majority … … 14
Question so resolved in the affirmative.
Motion agreed to.
– I decline to take any further part in the proceedings of this House, on account of the tyrannical way in which Mr. Speaker conducts them.
The Leader of the Opposition and other honorable members from the Opposition benches thereupon left the Chamber.
– I desire to call the attention of the House to the fact that the honorable member for Parramatta was grossly insulting tomyself. I expect the fullest apology from him, and call upon the Prime Minister, as Leader of the House, to give me the fullest possible protection from the insulting remarks of the Leader of the Opposition. The mere suspension of the honorable member for a short period will not be a sufficient punishment for the injustice he has done me and the insults that he has hurled at the Chair.
– It is my painful duty, in upholding you, sir, in your position as Speaker, to move -
That the right honorable member for Parramatta (Mr. Joseph Cook) be suspended from the service of the House until he returns with Mr. Speaker’s consent and apologizes to Mr. Speaker.
Motion agreed to.
– The question is that the Bill be now read a second time. Those in favour say “Aye,” on the contrary “No.” The “Ayes” have it.
– The honorable member is too late. The question has . been put and passed.
– If we cannot have any privileges in the House, we might as well get out of it. You can suspend me, too. I think this is a gross violation of the privileges of honorable members. Mr. Speaker saw me before he put the question, and knew I was going to speak. You can have the Parliament to yourself. You will know what you are doing then.
Bill read a second time.
Clauses 1 to 5 agreed to.
Clause 6 -
After section 36 of the principal ‘Act the following section is inserted: - “ 36a. The Bank may, with the approval of the Treasurer, enter into an arrangement with the proper authority controlling any Savings Bank constituted under the laws of a State for the transfer to the Bank, upon such terms and conditions as the Governor thinks fit, of the assets, liabilities, and business of that Savings Bank.”
Amendment (by Mr. Fisher) agreed to-
That after the word “fit” the words “the whole or any part “ be inserted.
Clause, as amended, agreed to.
Clauses 7 to 10, and title, agreed to.
Bill reported with an amendment, and (on motion by Mr. Fisher) recommitted for the reconsideration of clause 2.
In Committee (Recommittal) :
Clause 2 -
After section 7 of the principal Act the following section is inserted:- 7a. (1) The Bank may, with the approval of the Treasurer, enter into an arrangement with any other corporation carrying on the business of banking, for the purchase by the Bank of the assets of that corporation, and for the transfer to the Bank of the business and liabilities of that corporation…..
Amendments (by Mr. Fisher) agreed to-
That after the word “bank,” line 7, the words “of all or any” be inserted.
Thatafter the word “ corporation “ the words “ or any part thereof “ be added.
Bill reported with further amendments.
Standing Orders suspended, and Bill passed through its remaining stages.
In Committee (Consideration of GovernorGeneral’s message) :
Motion (by Mr. Tudor) agreed to -
That it is expedient that an appropriation of revenue be made for the purposes of a Bill for an Act to provide for the payment of bounty on the manufacture of pig iron from Australian ore, £30,000.
Resolution reported and adopted.
That Mr. Tudor and Mr. Hughes do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Tudor, and read a first time.
Standing Orders suspended.
– I move -
That this Bill be now read a second time.
The Iron Bounty Act was in operation for about five years, and this Bill is to continuethe bounty from the 30th June last year until the end of December next year. The reason for fixing so short a period is that the industry has been inquired into by the Inter-State Commission, and, further, that another pig-iron manufactory is about to come into existence; and the Government think that, in view of the greater knowledge that Parliament will obtain of the industry during the coming year, it is wise not to ask to continue the bounty for a longer period in the present Bill. The amount of the bounty is not the same as that authorized in 1908, when it was fixed at 12s. per ton, as compared with 8s. on the present occasion. There has been an alteration in the conditions under which the bounty shall be paid. Hitherto it has been claimed only in New South Wales, and the rates of wages and conditions of employment have been fixed by a Wages Board. As the bounty was paid to only one firm, this meant practically a one-firm Board; and the Government think it inadvisable to continue this plan, and provide that the conditions of employment and the rates of wages shall be fixed by the Commonwealth Arbitration Court. Clause 11 provides that the Minister may make application to the President of the Commonwealth Arbitration Court for a declaration as to what wages and conditions of employment are fair and reasonable, and the same clause provides -
If the Minister finds that the rates of wages and conditions of employment or any of them -
are below the rates and conditions declared, as in the first sub-section of this section mentioned, to be fair and reasonable: or
are below the standard rates and conditions of employment prescribed by the Commonwealth Court of Conciliation and Arbitration, the Minister may withhold the whole or any part of the bounty payable.
– Is this clause regarding the Arbitration Court constitutional, seeing that the industry is confined to one State ?
– This is one of the conditions on which the bounty is given,, and if the Bill is declared ultra vires, of course the bounties will lapse; but I do not think that the persons interested are likely to raise any objection.
– The circumstances to-night are unpropitious for dealing with this matter as I should like, and, therefore, I shall only briefly refer to one or two’ points, leaving any further comment in regard to the duty and bonus on iron and steel, which, to a great extent, are produced in my electorate, to a later date, when the Tariff is being discussed. I had intended appealing to the Minister with a view to having pig iron, later on, made subject to a Customs duty.
– There will be an opportunity next April.
– I am obliged to the Minister for the information, and am pleased to see that the Minister is evidently prepared to grant what I require. I should have liked to have given some details in regard to the production of steel rails and corrugated iron and galvanized iron, particularly the latter, which are not provided for in the Bill, but are incidental to the iron industry. I suggest that the Minister, when preparing the Tariff, should impose, on galvanized corrugated iron, and corrugated iron not galvanized, a duty proportionate to that on steel rails. The duty on steel rails has resulted in increased manufacture, until we can almost supply our own requirements. As a consequence there has been a decrease in the amount of revenue received in this connexion; and if the duty on galvanized and corrugated iron that I suggest were imposed, it would afford some compensation, and, at the same time, give a badly-needed impetus to the steel industry. Much money has been lost in New South Wales in the endeavour to establish this manufacture. I am pleased to observe that provision is made for referi’ng the question of wages and conditions to the President of the Arbitration Court. I think that those provisions will generally be received with approval, and are a fair solution of what was an awkward problem.
Question resolved in the affirmative.
Bill read a second time.
Clauses 1 to 3 agreed to.
Clause 4 -
The Governor-General may authorize the payment, out of the ConsolidatedRevenue Fund, which is hereby appropriated for the purpose, of bounty on the manufacture in Australia, after the thirtieth day of June. One thousand nine hundred and fourteen, of pig- iron, according to the rate set out in the schedule to this Act. . . .
– As the last bounty didnot expire until after the 30th June, I propose, as a safeguard to the revenue, to insert a proviso which the Attorney-General thinks will prevent the claiming of bounty twice. I move -
That after the word “ Act “ the following words be inserted: - “Provided that no bounty shall be paid on pig-iron manufactured after the thirtieth day of June, One thousand nine hundred and fourteen, and upon which bounty has already been paid.”
Amendment agreed to.
Clause further amended consequentially, and agreed to.
Clauses 5 to 15, schedule, preamble, and title, agreed to.
Bill reported with amendments; report adopted.
Bill read a third time.
– I move -
That this Bill be now read a second time.
Section 15 of the Public Works CommitteeAct of 1913 provides that ‘works authorized “ during the present session “ need, not be referred to the- Committee, and this Bill amends the principal Act so asto cover works already sanctioned by Parliament, but to allow other works to besubmitted to the Committee later.
– The Bill will coverall new works and buildings which wehave agreed to?
– This is in accordancewith the announcement made to the Housethe other day by the Prime Minister?
Question resolved in the affirmative.
Bill- read a second time and reported from Committee without amendment; report adopted.
Standing Orders suspended. ‘
Bill read a third time.
– I move -
That this Bill be now read a second time.
This is a short Bill to provide against an omission to number our Australian notes,, which was required by the original Act. None of the notes have been numbered..
Question resolved in the affirmative.
Bill read a second time, and reported from Committee without amendment; report adopted.
Standing Orders suspended.
Bill read a third time.
.- I move -
That this Bill be now read a second time.
This Bill is necessary because of the alteration in the strength of whisky effected in the new Tariff. In the existing Act of 1906 it is provided that barley malt whisky can only be distilled to a strength of 35 per cent, over-proof. This Bill will permit of the distillation of whisky to a strength of 45 per cent, over-proof, and I am informed that this will permit of a purer spirit being distilled by the Australian manufacturer than has so far been possible. In the case of a whisky distilled at a strength of 35 per cent, over-proof the product contains an excess of byproducts, such as fusel oil, with the result that a much longer period than that provided in the Tariff, namely, two years, would be required to produce a potable spirit. The distillers have been asking for this provision for a great number of years, and I understand that this Bill will give them greater protection.
Question resolved in the affirmative.
Bill read a second time, and reported from Committee without amendment; report adopted.
Standing Orders suspended.
Bill read a third time.
.- J move -
That this Bill be now read a second time.
In submitting this motion I may state that my task has been greatly lightened by my honorable colleague, the Assistant Minister of Defence, who is absent on Ministerial duty. He has prepared a summary of the alterations proposed to be made in the Principal Act, which will assist the House to readily grasp the purpose and scope of this measure. It involves no fundamental ‘change in bur
Defence policy. The Bill may, indeed, be described as a validating measure. Some of the provisions have been rendered necessary by the circumstances brought about by the war. We have had a veryserious drain upon our instructional staffs and our senior officers. It is laid down in the Defence Act that promotions shall be made by competitive examinations up to a certain stage, and that senior promotions shall be made from among those who attended a school of instruction conducted by the General Staff, the object of which is to test their fitness to command. The Bill, however, provides for promotions being granted during the time of war without compliance with the sections of the Act, which render examinations necessary. Non-commissioned officers are not required to attend schools of instruction, and the provisions of the Bill do not apply to them. They apply, however, to commissioned officers. Where a lieutenant or a captain wishes to go up to the next step in rank, the Act provides that he shall attend a school of instruction, but we are not able to give the instruction. Suppose a major desires to qualify for a lieutenant-colonelcy, he has to go before a school of officers deputed by the General Staff, who have to test in the field his fitness to command, but inasmuch as we cannot carry out that provision now, we ask authority to make promotions without putting the officers through the school of instruction or testing their fitness to command. The officers will still be subjected to tests, but not to those laid down in the Defence Act. Therefore the Bill gives to the Minister and the Military Board the opportunity of protecting the rights of commissioned and noncommissioned officers who are away with Expeditionary Forces.
– Will you make it plain that the Bill does protect their rights ?
– The desired protection, if not in the Act, will doubtless be insured in the regulations. Another provision in the Bill is needed in order to clear up a difficulty created by the Defence Act 1912. When we brought the defence scheme into operation it was obvious that we would need to increase very largely our staff of instructors, and the process was adopted of putting a large number of instructors through schools of instruction .
But that method was found to be too slow to provide for the needs of the Forces, and, therefore, as there were a number of time-expired noncommissioned officers of the British Army in the Commonwealth, it was decided to open the positions of instructors to these officers without calling on them to go through a school of instruction, provided they were able to satisfy the Commandant of the State in which they were resident by a practical examination that they were fitted to act as instructors. A great many of these officers have been taken in, and in the majority of cases they have proved to be satisfactory.
But in doing this we unwittingly did an injustice to men in our own Forces, because, by putting in the words “ British Army,” we made these positions open. It was a distinct anomaly that while the non-commissioned officer of the British Army was allowed to come in without examination, our own men, with similar qualifications, were obliged to pass an examination. We may have in the Commonwealth a man quite fitted to instruct, but if he wished to act in that capacity he would first have to pass through the school of instruction. The Government wish to put our own Forces on the same footing as that occupied by officers of the British Army who are now in Australia. Thus, if persons are fitted to act as instructors, they may be permitted to do so without having to pass through the school of instruction.
– Will the Minister explain how a non-commissioned officer will be able to secure a commission after the expiration of five years from the passing of the principal Act?
– I think that we had better defer consideration of details until we get into Committee. Another provision of the Bill is one about which there may be some misgiving. At the present time we cannot initiate a prosecution under the Act after six months have elapsed from the time the offence was committed. Considerable discussion took place in this Chamber when the Bill was before Parliament, because it was then proposed to limit the period to twelve months after the commission of an offence, and an amendment was moved to substitute six months. The alteration which is now proposed is the result of experience. We have had some pretty bad cases of offences which have not been discovered within the prescribed period of six months. It frequently happens that offences are not detected until nine, or even twelve, months after their commission.
I ask the House, therefore, not to hamper the cause of justice by adhering to six months. If no offence has been committed, there can be no prosecution. But where an offence has been committed, and is not disclosed until nine months later, we ought not to be debarred from instituting a prosecution under the Act. Under the law as it stands at present, it is necessary to discover the offence about three months after its commission.
There are some provisions of the Bill dealing with cadets to which I invite attention. Honorable members will recollect that in the Act of 1912 we thought that we had made provision by which under no possible circumstances could cadets be placed in gaol. That was the intention of the measure, but it has not achieved its purpose. There seems to have been some laxity in its drafting, and after its enactment it was discovered that cadets could be sent to gaol for certain offences. In this Bill several provisions of the existing law have been recast, so that now we believe it is proof against any future action of that kind. We hope that when the measure becomes law there will be no possibility of any cadet being sent to gaol for any offence against the Act. What we propose to do in the future is to see that the Defence Act is enforced, and, at the same time, that no hardship is inflicted on the cadets. In this connexion we have arrived at the conclusion that no amendment of the Defence Act is necessary. Instead, we propose to provide in the regulation that when a lad commits an offence after he has been sent to a place of military detention, he shall be dealt with, not by the military officers, but by a civil Court. I need scarcely add that this is not the time to make drastic changes in our Defence Act. To do so would certainly be “to swop horses whilst we are crossing the stream. I say, therefore, that the changes which we make in the law should be limited as far as possible, and I trust that those honorable members who are not satisfied with the Act in its present form will realize that we are passing through a crucial period in our history, and will not press amendments of a very drastic character. I need to add very little more in commending this Bill to the consideration and approval of honorable members, and, without further observation, I submit the motion.
– I regret that the Assistant Minister of Defence is not in charge of this Bill to-night, because there are a few matters in connexion with the position of non-commissioned officers which I desire to have cleared up. As we are going to meet to-morrow, I do not think that we ought to put this Bill through to-night.
– Tlie Minister representing the Minister of Defence cannot be here to-morrow. His wife is to launch the destroyer Derwent in Sydney.
– Non-commissioned officers labour under very great disabilities. It is true that this Bill does propose to grant them some slight measure of relief. The position to-day is that non-commissioned officers cannot obtain commissions unless they pass an examination which is of such a character as to preclude that possibility in the great majority of cases. Section 144 of the Act provides -
No person who is not a graduate of the Military College as prescribed shall be appointed an officer of the Military Forces. Provided that this provision shall not take effect until five years after the establishment of the College.
That means that, at the end of five years, non-commissioned / officers will have no opportunity of gaining a commission, even by passing an examination. Every pelmanent office will be filled by a graduate from the Military College.
– Look at clause 2 of the Bill now before the House.
– That relates only to time of war. It proposes to add the following proviso to section Iia -
Provided further that, in time of war, notwithstanding anything contained in this Act, officers, warrant officers, and non-commissioned officers may be appointed and promoted as prescribed by the regulations.
What are the regulations ? I will guarantee that no honorable member knows. Every week we get a fresh batch of them. But even if they were of such a character that promotions could be made in time of war, they afford very little relief to noncommissioned officers in time of peace. In my judgment, the foundation of our military system is largely dependent upon the character and ability of our noncommissioned officers. They have to do the real work, and yet they have received little or no consideration, either from this or from previous Governments. The Area Officers generally consist of bankers, school teachers, &c, who are in receipt of good salaries. We have provided an increment of i £30 per year for those who fill these positions. These bankers and school teachers are getting about £180 a year, whilst the non-commissioned officers are receiving only about £170, notwithstanding that they are required to devote the whole of their time to the discharge of their military duties. Under existing conditions, we appoint Area Officers from outside the Forces, and pay them better than we pay our non-commissioned officers. It is a great pity that we have to proceed with this Bill to-night: I desire to see justice done to our noncommissioned officers. I wish, also, to deal with salaries, allowances in camp, and field allowances, and I desire to compare the allowances which are being paid to our non-commissioned officers with those that are being paid to officers in the higher ranks. I have here a list of the scale of payments. It is called “The military financial allowances.” I do not know who framed these regulations) but it seems to me that they are always framed with a view to insuring that the higherpaid officers shall receive the bigger travelling allowances.
– That is the case under the Public Service Act.
– It is about time that we altered it.
– It is rather late in the morning to attempt to alter it now.
– I have remained silent when other measures were under discussion, and have patiently’ awaited the introduction of this Bill. I did not think it would come on for consideration at such a late hour, and it would not if the Government had not decided that they were in charge of the business of the House, and intended to push it through. These are the military financial allowances - members of Military Board, £75 per annum ; commandant of the Second Military District, £175 ; representative in England (Dominion’s section, Imperial General Staff), £150; directors military board, £50; inspecting ordnance officer, £25; general staff officers and staff captain at head-quarters, . £25. Nobody knows what that special allowance is made for. I have made inquiries, and have been’ unable to get an answer. But we do not find that there is any special allowance for the non-commissioned officer. Can anybody tell me what this special pay is for?
– Have they not their frill?
– It may be for frill. Then there is the removing allowance. A lieutenant-colonel is allowed £25, and a warrant officer £19. For the children of a lieutenant-colonel or of a major, 4s. each is allowed, and for the children of the non-commissioned officer only 2s. each. I do not see why there should be that difference.’ It costs as much to bring the child of a warrant officer from Brisbane to Melbourne as it does to bring the child of a lieutenant-colonel. There are also travelling allowances, and under this heading members of the Military Board, inspector-general, brigadier, and commandant get 20s. per day; a colonel or lieutenant-colonel or major, 15s. a day; a warrant officer, 10s. a day; and a sergeant or other non-commissioned officer, 8s. per day. If those men are travelling on the railway, and they enter a restaurant, they are all charged the one price. One man does not pay 2s. 6d. and the other ls. 6d. for a meal.
– What about the officer’s dignity ?
– We are paying the higher officers from £650 to £900 a year to uphold their dignity, while the noncommissioned officers are only receiving from £156 to £204. I think that the man who is drawing £156 in salary ought to get the 20s. a day, and the man who is drawing £900 ought to receive the 8s. Of course this scale is fixed by the persons who are drawing the higher salary; they are careful to look after their own interests. I do not know of any other opportunity of altering these inequitable rates unless I do it in connexion with the amending Bill.
– Suppose you do it in Committee.
– Very well. I am not talking for the sake of talking, but I do know that an injustice is being done to these people, and I will not be doing my duty if I do not take the opportunity of endeavouring to have that injustice rectified. I turn now to the camp or field allowance. Members of the Military Board, inspector-general, and commandant receive 10s. per day. Those men are paid from £800 to £1,500 a year. Colonels and lieutenant-colonels, drawing from £575 to £675, receive 7s. 6d. a day. When those men go into camp they are fed at the country’s expense. The camp costs them nothing. Yet these men, drawing up to £1,500 a year, as well as travelling allowances, are allowed 10s. a day when they are in camp. The man who is drawing £176 a year is paid nothing in camp. I think -that is scandalous, and we ought to remedy that sort of thing. I know of one of these gentlemen in gold braid who went to a hotel, and was sitting at his dinner, when a noncommissioned officer came in. The landlady, not knowing any distinction in the ranks of the two men, directed the noncommissioned officer to sit at the same table as the officer, who thereupon rose and walked to another table. That is the sort of class distinction that is growing up in connexion with our Citizen Defence Force.
– That officer ought to be sent to a dog-kennel.
– When a sergeantmajor travels into the country on duty, he is only allowed a second class fare, but the officer travels first class. If two officers are travelling to a district, one to train the Light Horse and the other to train the boys, one enters a first class carriage and the other a second class. I thought we were trying to abolish class distinctions in the Australian Military Forces, but they exist, and no attempt isbeing made to remove them. I contend that a man who is drawing a salary of £1,500 a year should get no allowance in camp. If it is necessary that the officershould travel first class, then the sergeantmajor has just as much right to> enjoy that privilege. Now, how do wetreat these men in time of war ?
– Do not look at me so sternly.
– I am at a disadvantage in speaking on this question when the Minister of External Affairs is in charge of the Bill, because he is not acquainted with the subject. I have promised my constituents that, at the first opportunity, I would try to induce the Government to remedy this state of affairs, but if this Bill is to be passed through to-night, one’s hands are tied, because the Minister of External Affairs, however sympathetic he may be, cannot accept my amendments. I do not claim to be an expert on this matter. It is very difficult to get an understanding of the various features in connexion with the Military Forces. I have devoted a good deal of time to this matter, and I recognise to-day that I only faintly understand the many aspects of defence matters. If the Prime Minister is going to ask the House to pass this measure through to-night, we shall be doing an act of injustice to the sergeantmajors. We have practically denied them promotion during the war.
– They can get it under this Bill.
– Little or no provision is made for them. We have always UnderStood that in the Citizen Army a man could rise from the rank of private to that of general, and yet the position is that, five years after the establishment of the Military College, every permanent officer in the Forces will require to pass through that institution.
– Not during the war.
– But the war will not last for ever.
– Your argument is against the principal Act, not against this Bill.
– Then I desire to have the principal Act amended.
– This is not the time to do that.
– When is the time to do it?
– When we resume in the new year.
– I know that I am correct in saying that five years after the creation of the Military College no permanent appointment can be given to a man in the ranks. Every poor man’s son cannot get to the Military College, in spite of all that is said. The examination is a fairly difficult one to pass. I am not asking that the standard should be lowered. I have a lad going to a high school who is endeavouring to qualify for this examination. I can afford to pay for his education at the high school, but there are thousands of workers in this country who are not in a position to send their sons to a high school to qualify for the examination which it is necessary for them to pass before they can enter the Military College. It is proposed to confine the position of a permanent officer to those who have passed through the Military College, and I say again that this will raise up a military class.
– Has the honorable member read the second proviso of section 148 of the Act ?
– That makes provision for admission to the Military College of any member of the Forces over nineteen years of age who passes the prescribed examination, and is recommended by the Governor-General -in-Council. That applies only to the period prior to the expiration of five years from the establishment of the Military College.
– I had an interview with Senator Pearce upon this matter, and he is emphatic on the point that no man will be appointed a permanent officer unless he has graduated from tlie Military College. The ranker has no hope whatever. I ask honorable members to listen to this -
The best soldiers must lead, whatever their civil avocation or birth. There is ample evidence that, instead of the best soldiers leading, a large number of the commissions have been given to men who have social pull over the heads of capable Australians with vastly superior military knowledge and attainments. There are twelve lieutenants and a captain in one of the ammunition corps, whose total militia service would not equal that of one warrant officer in the permanent service. Six of them have had less than nine months’ service, and received their commissions on a mere educational entrance examination, without having had any military training whatever. Although placed in charge of men of years of service, they will go into action absolutely dependent on the warrant officers who accompany them.
Warrant officers and non-commissioned officers have been prevented from going to the war. The reason given by the Minister of Defence is that they are wanted here as instructors. If their worth as instructors is recognised, why are they not given a chance of promotion ? Why should we go to lawyers and others who have long ceased to have any connexion with the militia, and appoint them as captains at £1 2s. 6d. a day, or lieutenants at 17s. 6d. a day, with a field allowance of 3s. 6d. each? No one can question the fact that social influence has been exerted to a great degree in the appointment of officers of our Expeditionary Forces. Sergeant-majors have applied for commissions in the Expeditionary Forces, and their applications have been refused. They are men who know something about military matters; and I am satisfied that the parents of the lads who have gone to the front would prefer that they should be led by these men rather than by lawyers and others who have had little or no military experience, but who have had the necessary social influence to secure positions for them as officers of the Expeditionary Forces. If our noncommissioned officers have not been permitted to go to the war because, recognising their worth, we require them here as instructors, let us at least see that justice is done to them, and that they are given an increase in salary of at least £100 a year. IF a man happens to come from England he will have no difficulty whatever in securing’ a position as an officer. I can mention the case of Lieut. -General H. Betton-Foster, Reserve of Officers (Royal Garrison Artillery), who is employed temporarily on £he Instructional Staff, and granted the temporary rank of lieutenant with pay at the rate of £250 per annum, inclusive of all allowances except travelling; and also the case of Captain A. J. Broun, Reserve of Officers, Middlesex Regiment, appointed to be General Staff Officer with the temporary rank of captain. Men who come from the Old Country are permitted to step over the heads of our own sergeant-majors, many of whom have given twenty-five years’ service to the country. I am told that these men can qualify by passing an examination. I went to the trouble to secure a copy of the examination paper. I have one here. At one time I had to go up for matriculation, so I know a little about examination papers, and I declare that this paper is much harder than the paper set for the matriculation examination. How can we expect men who have been twenty-five years in the service, and who have had no special education, to pass such an examination as this ?
– Is it an examination in Latin, geometry, and trigonometry ?
– Here is one of the questions included in the paper -
I guarantee there are not five members of this House who could answer that question. Here is a question in algebra -
This next is a question in geometry -
Draw two parallel lines at a distance 3 inches from one another, and mark a point between them 1 inch from one of thom. Then draw a circle to pass through this point, and touch the two given lines. Explain your construction.
I have the facts connected with the case of a non-commissioned officer who set to work and passed this examination. We know that there is a certain class the members of which are determined not to allow these people to obtain commissions. They cannot fail them in practical work, and they cannot fail some of them in the examinations, because the papers sent in are examined by the authorities at the University. All that is left them is to fail them in tactics, and then the men have no redress whatever. I have particulars of the case of one of the most capable non-commissioned officers in Australia. Although he is somewhat up in years he determined to pass this examination, and showed his ability bv passing it. Then he failed in tactics, and he has no redress. The answer of the Minister of Defence, when reminded of this kind of thing, is that some of the noncommissioned officers have passed the prescribed examination. My reply to that is that the non-commissioned officers who have passed the examination were almost without exception ex-school teachers. They entered the Defence Department as noncommissioned officers, with the sole object of passing the examination in order to secure a commission. Only a schoolteacher could be expected to pass such an examination, and honorable- members must agree that it is exceedingly difficult for a man who is forty or forty-five years of age, and who has had no special educational facilities, to pass such an examination. I think that the whole question of Area Officers needs to be dealt with. I know an Area Officer who never went near his unit for nearly two months. He took up the position of secretary to tlie Liberal candidate, and for two months before the election he never went near his duties, but I suppose that he drew his salary just the same. After the elections he resigned his position. The Department immediately appointed him to another position in the Army. To show that social influence is at work, let me mention that prior to that he had occupied another position. He resigned, and it was found that £239 worth of stores in his possession had disappeared. The Department has not got them yet, but that did not prevent the man from getting another position. After he resigned as an Area Officer it was found again that stores had disappeared, and a Military Board sat for a month inquiring into the matter. It reported that the officer was responsible, and called upon him to refund the amount.
– Do you mind saying who was the Minister?
– I have gone to the trouble to get the files, and I know that my information is correct. According to the report the shortage on the second occasion was only £3 10s. or £4, but the Minister, Senator Millen, wrote this minute, “ Charge it up to the public account.” After the last election, when this gentleman again was secretary of a member of the Liberal party - ;who believed not in preference to unionists - and while the Liberals were still in power, he was appointed embarkation officer at 22s. 6d. a day, and I believe he still occupies the position. The Liberals had no difficulty in finding positions for their friends. Undoubtedly, social influence has been used to a very large degree in military matters, and non-commissioned officers have been the greatest sufferers as regards the Military Board. They have no representation, aa I think they ought to have.
If there was some one there to speak on their behalf, that fact would guarantee some amelioration of the present trouble. It would secure to them some redress. At any rate they could feel sure that at headquarters due representation of their troubles was being made. I do not propose to speak more at this juncture. Many honorable members who know the disabilities under which non-commissioned officers are suffering desire a fair opportunity to speak, and, therefore, I ask the Minister to delay the Bill until to-morrow, when the Minister of Defence will be within the precincts of the building, and we can obtain an explanation of the various matters which we cannot obtain now.
– Every honorable member, I am sure, sympathizes with, the honorable member for Ballarat in the difficulty he experiences in presenting his case, and also with the view he takes generally of Defence matters. The only recommendation the Bill has is that it is a temporary one, and evidently is only brought on because of special circumstances in connexion with the war. The Minister who is in charge -of the measure may, however, advise the Minister of Defence that more than one or two members of his party are determined that before long there must .be some very drastic alterations in regard to Defence matters, that next session there must be some attention paid to the glaring injustices and anomalies which exist. I have a file of correspondence conveying information somewhat similar to that supplied by the last speaker, and, therefore, there is no need for me to waste the time of the House in elaborating the case. May I just point out one glaring difficulty, and, I think, unfairness which the warrant officers and the non-commissioned officers are now suffering under ? Their pay, in comparison with the pay to officers in the Expeditionary Forces, amounts almost to an insult to men who give the whole of their time, energy, and experience to the service of the Commonwealth. There was brought under my notice a case, and it is only one of many, where a warrant officer, who gives his whole time to the work, and has to keep a home, is receiving 5s. a day, while young men, from eighteen to twenty-one years of age, who, in many cases, earn practically nothing in ordinary circumstances, and in some cases earn only £1 and 30s. a week, are drawing from 10s. to £1 a day in connexion with the Expeditionary Forces. I do not say that the latter are overpaid, but I do emphatically say that the former are seriously and disgracefully underpaid. I have gone very carefully through the Estimates to discover the increases which are proposed in various grades of the Public Service. It is my intention later to take a very drastic step in regard to protesting against increments to any men in the Public Service in receipt of more than £300. I find that, in the Defence Department alone, thirty-two officers are recommended for increases.
– What are they receiving now ?
– They are all getting over £300 a year.
– They, will not get that when we have passed the Estimates.
– I am sure that they will not, but that is not the worst of ifc. The Estimates are framed so peculiarly that it is almost impossible to say how many men are getting increases and who they are. For instance, on page 94, I notice that a lump, sum of £490,000 is set down for 3,725 men in the Naval Forces, while, on page 124, the lump sum of £900,000 is put down for 61,827 persons. How can honorable members dissect such items and find out who are getting increases, and whether they are reasonably entitled to the money ? This matter will need very careful investigation, and the Minister of Defence can be quite sure that some information about his Estimates will be wanted by members on this side. Concerning the Bill, clause 4 inserts this provision in the Defence Act - 16a. Notwithstanding anything contained in this Act, members of the Citizen Forces who have been employed on active service abroad may, upon their return to duty with the Citizen Forces, be given such rank and allotted such regimental seniority as are approved by the Governor-General on the recommendation of the Military Board.
I want to protest at the failure to have some such regulation in existence at the present time. I know of one Area Officer in Brisbane who has been repeatedly recommended for a captaincy, and who has just as frequently been refused promotion. He has passed all the tests, and has been recommended for promotion by his superior officers; and yet professional jealousy, military etiquette, or that disgraceful red-tape which is so intimately associated with military matters, prevents this young man obtaining the position to which he is entitled. If this is held to be right in time of war, it is even more likely, to occur in time of peace. I hope that in this amendment of the principal Act some provision will be made to recognise the work of the Area Officers. A great mistake was committed in the early stages of the Citizen Forces in the appointment of Area Officers as at present provided. We have men who give their days to their ordinary avocations, in which they draw good salaries, and only an odd hour or two in the week to the work of drilling the citizen soldiery. The situation is monstrous. A salary of £150, rising to £180 a year, is disgraceful pay for those who enter enthusiastically upon their work as Area Officers, giving the whole of their time to it. On the other hand, it is a disgracefully extravagant pay for those who give only the “ fag ends “ of an odd evening or two in the week to it. Our citizen soldiers are not being trained as they ought to be. Those Area Officers who are prepared to give the whole of their time to their official duties should be properly remunerated, and those who are not should not be employed. I said three years ago, and I repeat the statement now, that the Minister of Defence had at his disposal then, as he has now, a sufficient number of warrant and noncommissioned officers, to whom an extra £50 a year would have been a splendid recompense, to take charge of the citizen soldiers. Had they been employed, we should have had a much better result. Recognising that the time is inopportune, and an amendment of the Bill impossible, I shall deal only casually with the suggestions I have to offer. Under clause 7 it is proposed to amend section 31 of the principal Act, which deals with the position of the Permanent Military Forces, with the object of attaching aviation officers to them. We have not been too quick - indeed, I think we may chastise ourselves for having been too slow - in adopt- ing aviation as a means of defence. Experience in Europe during the last two or three months has proved the remarkable adaptability and utility of this branch of defence. We established a flying school at Point Cook some time ago, and I hope that every assistance will be given to the Minister in persevering with that most laudable beginning, because there are all over Australia men who are enthusiastic in aerial work. I had an application from a volunteer flying corps in Brisbane, composed of gentlemen who are devoting their time and their private means to most enthusiastic work in this direction, and who are anxious to be of assistance to their country. All that they ask is that the Defence Department shall recognise them officially, so that, if needed, they can be called upon, and their services utilized, for the defence of Australia. The Minister of Defence, in his reply to my request, however, expressed his regret that the Department could not see its way to give the recognition asked for. It seems to me that, at this particular juncture, the encouragement of an aviation school would be most advantageous to the Department of Defence. I wish the flying school at Point Cook the utmost success. It is only the beginning of this work of aviation, and once it is well established, branches will no doubt be established throughout the States. Wherever we can get a number of men who are willing to find their own machines and spend their own time and money in prosecuting this work, I think their efforts should be cordially supported. A little encouragement now will be worth thousands of pounds to the Commonwealth later on. I hope that in this Bill, as well as under the Defence Regulations, there may be some consideration given to this branch of the service, and that aerial corps, whether permanent or volunteer, will be encouraged. There is one clause in this Bill which pleases me exceedingly. I refer to that in which it is provided that where Children’s Courts exist offences against the Act committed by cadets under the age of seventeen years shall be prosecuted as far as practicable in such Courts. Nothing is more saddening; nothing has caused more heartburning to some mothers, than that their sons should be brought before a Police Court for neglecting to do their drill, just as if they were ordinary crimi- nals. I have no sympathy with, and offer no excuse, for boys who neglect their training. That neglect may arise from a perverted sense of duty, or from various causes incidental to the life of some of the boys. .But this military duty is so heartily accepted and taken up by the boys generally that there should be very little sympathy for those who are selfish and unthinking enough to neglect their drill. They should be reminded of their duty. But a Police Court is not the place in which to advise these boys of their duty as patriots and citizens. That they are to be taken to Children’s Courts, where probably, in a more kindly, more gentlemanly, and almost fatherly way, the Presiding Officer may talk to them rather than seek to charge them, demand evidence, and put the parents and the lads themselves to expense is, I think, a matter for congratulation. I hope that the Minister will give this provision a very fair trial, as I think it will be not only to the advantage of the boys, but greatly to the satisfaction of their mothers. There is some alteration of the principal Act necessary, so that lads residing at a distance of more than 5 miles from a training centre shall not be called upon. There should be some requirement as to Area Officers doing some of the travelling; the boys should not be asked to do it all. Some friends of mine at Box Hill brought under my notice a case arising there. I referred them to the representative of the district, and I do not know what was the result of their representation. But the case they brought before me was that the Area Officer used to go out once a week to Box Hill, and that lads had to travel there from Doncaster, and other places, in some cases 5 miles, 6 miles, and even 1 miles distant, in order to do their drill. The officer was asked if he could not hold a drill at Doncaster occasionally, so that the boys would not have to* travel to Box Hill and back. Doncaster is between 2 and 3 miles from Box Hill, and the officer said that if he was provided with a conveyance from Box Hill to Doncaster he would go there, but if not the boys would have to walk to meet him. It is easier for one man to travel that distance than for a large number of boys to have to do the walking. The officers ought to be expected to do some of the walking, and if this officer had been enthusiastic in the performance of his duties, the difficulty would not have occurred. Every reasonable consideration ought to be given to the lads, a number of whom have just begun work. Many of them cannot get home until halfpast 6 or 7 o’clock. To force them to walk a long distance to attend drill by 8 o’clock is injurious to growing lads. Military training can give remarkably good physical results, as will be seen by the improvement in the general bearing and carriage of our boys, but it must not be superimposed on a day’s work and a long, fatiguing work. I hope that next year we shall get an amending Bill to provide that all drills shall be carried out in the day-time, and on proper grounds, instead of in the night-time in tlie streets or paddocks. I see no reason why the boys should not be allowed off from their ordinary work at least one day a week to do their drill. This would be beneficial to the boys, and no hardship to their employers. The present age of fourteen for starting military training is altogether too young. I strongly favour making it sixteen. Between fourteen and sixteen there should he some form of physical training, but no military training. The physical training would fit the boys to receive military training after reaching sixteen. There is great room for improvement in the defence system, but the military and naval defence of every country is a perpetual source of trouble and worry, and ours is no exception. I hope that after the war is over we shall arrive at a much saner and less expensive method of conducting military operations.
– I hope sergeant-majors will receive an increase of salary, and I strongly resent the action of a certain clique in military affairs in arrogating to themselves the right to say who shall be appointed and who shall not, or who shall he accepted for active service and who shall not. Major Mclnerney has volunteered, and has been given a position as a superior land of policeman. He has a record which cannot be touched by some of the “polish up the handle” colonels who have’ sat in judgment on him, and who had not the pluck to volunteer for service in South Africa. Major Mclnerney, in South Africa, became the leader of his troops through the loss of his superior officer, and was then given by the Imperial Government a position in which he had the handling of over £9,000,000. That showed how they trusted him. Now, however, because he is out of favour with the frills and feathers clique that calls itself the Army and Navy Club he is not given an opportunity for active service. I have already told the House the very different treatment which the club meted out to Edwards, the German alien who took an English name. The thing is infamous. Why is an Australian native debarred from entering the Engineering Corps in the Naval Department? To prevent the service becoming a close preserve, all men should be encouraged to join the ranks. If they show that they are deserving of promotion to the rank of sergeant, let them go into the College, but they must first join the ranks, otherwise we shall build up a privileged class, and that would be against all the teachings and hopes of the Labour party. I therefore think that a Select Committee or a Royal Commission should be appointed to go into the question of the gradation. The salaries and allowances of the officers are really too absurd; and if ever there was a case of “greasing the fat pig” we have it here. I am sure that if there were a vote taken of the people, who have to pay, they would very soon veto the system. If for nothing else, I should support the Bill because of clause 8, which provides that the Citizen Forces of the Commonwealth shall not be called out or utilized in connexion with any industrial disputes.
Question resolved in the affirmative.
Bill read a second time.
Clause 1 (Short title).
– We ought to have an explanation from the Minister as to what is going to be done about the non-commissioned officersI think the Government might adopt the suggestion of the honorable member for Melbourne, and appoint a Royal Commission to inquire into the statements which have been made regarding the treatment of these officers, and to investigate the allowances given to the other officers. I am told that in connexion with the First Expeditionary Force, the officers were one day called in and given £15 15s. each in order to buy their outfits, and that the very next day they were called in again and presented with their outfits, being allowed to retain the £15 15s. Then certain officers, who had purchased a portion of their outfit, complained, and they were told to send in vouchers for what they had spent, and the money would be repaid. This information is given to me on what I believe to be absolutely reliableauthority. There is no such treatment meted out to the men, who are paid 5s. a day, with no special provision. I was told at the camp the other day that men who went there with only one suit twelve weeks ago have not yet been supplied with their uniform, and, as may be imagined, their own clothes are practically worn out. But I recognise the difficulties of the Minister, and I desire to accept the Bill as a decided improvement on the present state of affairs. I think, however, the honorable gentleman ought to consult with the Minister of Defence with a view to an investigation into the matters to which I have referred.
Mr. MAHON (Kalgoorlie - Minister of External Affairs [2.0 a.m.]. - It seems to me that the shortest way to achieve the purpose suggested would be for me to obtain the Hansard report of the speech of the honorable member for Ballarat,, and submit it to the Minister of Defence. I feel sure that the honorable member would not make the statements he made just now without reliable evidence, or what he regards as such, and he ought to have an opportunity to bring forward his proof.
Clause agreed to.
Clauses 2 to 13 agreed to.
Clause 14 -
Section one hundred and thirty-eight of the principal Act is amended -
by adding at the end of paragraph (d) of sub-section 1 the following paragraphs : -
Section proposed to be amended - 138 (1) The following shall be exempt from the training mentioned in Part
.- I move -
That after the word “ paragraphs “ the following paragraph be inserted : - “ And (da) Persons who are employed in a civil capacity for any purpose in connexion with the Defence Force (whether subject to the Commonwealth Public Service Act 1902- 1913 or not), or in any factory established in pursuance of this Act.’”’
This clause amends section 138 of the principal Act, which sets forth the exemptions from personal service. It is intended to apply to employes of the Clothing Factory, the Cordite Factory, the Harness Factory, and others who are engaged in the production or distribution of munitions of war, and who, therefore, should not be called on for training.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 15 and 16 agreed to.
Title agreed to.
Bill reported with an amendment.
Standing Orders suspended.
Motion (by Mr. Mahon) proposed -
That the report be now adopted.
.- I understand that the Minister of Defence has admitted in the Senate that some of the officers of the Commonwealth Bank who are serving with the Expeditionary Force are drawing a salary from the Bank, as well as the pay of their military rank. If that be so, I should like to know whether the same treatment is being given to operatives from the Harness Factory, Woollen Factory, and other Government factories who may have joined the Forces. If not, the anomaly is a glaring one, and I hope that effect will be given tothe suggestion of the Minister now in charge of the Bill, and that the remarks made by the honorable member for Ballarat at an earlier stage will be considered in connexion with an amendment of the law later in the session. The citizens as & whole should participate in the advantages as well as the risks of military service. Labour supporters will not be satisfied until our defence law has been amended to give effect to the desires of the people regarding a citizen army.
– The honorable member for Adelaide has ventilated a rumour to the effect that officials of the Commonwealth Bank who are serving with the Expeditionary Force are drawing their ordinary salaries, in addition to their pay.
– I understand that the Minister of Defence admitted in the Senate that that is so.
– Then the arrangement is a monstrous one, and ought not to continue an hour longer than can be prevented. I shall have the matter inquired into, and can promise that the Government will take such action as may be necessary in the circumstances.
Question resolved in the affirmative.
Bill read a third time.
The following Bills were returned from the Senate with amendments: -
Estate Duty Assessment Bill.
Treasury Bills Bill.
The following Bills were returned without amendment: -
War Loan Bill.
Loan Bill (No. 2).
Loan Bill (1914).
War Pensions Bill.
Defence Act -
Regulations amended (Provisional) -
Financial and Allowance - Statutory Rules 1914, No. 171.
Universal Training - Statutory Rules 1914, No. 172.
Motion (by Mr. Fishes) agreed to -
That the House at its rising adjourn until 12 (noon) this day.
Conduct of Business - Price of Bread in New South Wales - Pay of Members of’ Expeditionary Forces - Trawler Endeavour.
– I move -
That the House do now adjourn.
I desire to express regret for certain circumstances which arose during the sitting, and the hope that the representatives of the people may be able to meet here and to separate amicably for the adjournment over the Christmas holidays. There is still more work to be done before we can adjourn, but I wish particularly to point out that I have refrained from passing any measures to-night beyond those which were indicated to the members of the Opposition as measures that were considered necessary. I felt that we were bound by the promise that we had given to those honorable members as to the measures that we thought should be passed.
– Is there any truth in the statement made here to-night that some Commonwealth officers with the Expeditionary Forces are also receiving the pay attaching to their positions in the Commonwealth service ?
– I think that there is truth in the statement. However, I shall make inquiries. At the same time, I may point out that many of the private banks are doing the same thing. For instance, the Bank of Australasia, which was recently challenged in the press upon the point, and accused of treating its officers unfairly, is paying full salaries to the members of its staff who are serving with the Expeditionary Forces. The honorable member for Melbourne has on the notice-paper a motion which he would like to submit to the House, but I have suggested to him that he need not move it at this sitting. If honorable members are agreeable, the Government will offer no objection to the honorable member bringing it forward to-morrow.
.A question was asked during the week in regard to the price of bread in New South Wales. As I understood it, the statement was made that not only was 4d. the price fixed for the 2-lb. loaf in the metropolitan area, but also11/2d. on the ordinary price was fixed for country districts, which meant 51/2d. for the 2-lb. loaf. At any rate, that was the impression left on my mind, and, therefore, I telegraphed to Mr. Hall, the New South Wales AttorneyGeneral, and this is his reply -
In reply to your wire, late notification re bread means 4d. a loaf in metropolitan area, and an advance of1/2d. on last year’s prices in the country. This generally means 4d. in the country, also. State Bakery price less than 3d. loaf delivered Liverpool, over 20 miles from Sydnev.
– I was struck to-day by the admission made in the House that the trawler Endeavour did not have wireless installed upon it. Parliament has had under consideration for a number of years the Navigation Bill, which places on steam-ship owners certain obligations in regard to installing wireless systems, and the fact that one vessel, practically owned by the Commonwealth, should not be installed with a wireless system, seems remarkable. The vessel is probably drifting around as the result of a break-down, and the possibility is that if. she could have communicated with the mainland by means of a wireless system, a great deal of anxiety on the part of people connected with the men on the boat would have been removed. This is a sharp lesson for us, and should operate as a direct instruction to Parliament to see that, wherever possible, wireless systems should be installed on every vessel on which men have to travel on the seas.
– A vessel similar to the Endeavour owned by a private person would not necessarily have to carry wireless.
– That is not the point.
– I do not know whether the honorable member intended to convey that impression, but I wish to point out that, even under the most up-to-date Navigation Act in the world - that is our own Act - a steamer travelling from Launceston to Melbourne, carrying at times 500 passengers, would not be compelled to carry wireless.
– That is our fault.
– The matter of the Endeavour had previously been considered. The vessel had never gone such a long trip before. No pressure was needed to have the necessary steps taken, and I am informed that the Werribee left at midnight on a search. The contract waa not signed until 4 o’clock in the afternoon. A start had not been made to install wireless until 3 o’clock, and the fact that the vessel was able to clear at midnight is a tribute to the Naval Department, to Mr. Balsillie, who assisted, and . to the officers of the Customs Department, whose - action permitted of the arrangement being made so speedily.
– Will not the Loongana need to provide wireless after the Navigation Act is proclaimed 1
– Then we shall alter the Act.
– The Navigation Bill will not be dealt with before Christmas. We have agreed with the Opposition that it shall not be gone on with, and I agree with the Prime Minister that we should keep any promises we have made in that respect.
Question resolved in the affirmative.
House adjourned at 2.24 a.m. (Friday).
Cite as: Australia, House of Representatives, Debates, 17 December 1914, viewed 22 October 2017, <http://historichansard.net/hofreps/1914/19141217_reps_6_76/>.