6th Parliament · 1st Session
Mr. Speaker took the chair at 3 p.m., and read prayers.
– Has the Prime Minister yet come to a decision in reference to the suggestion put forward by me some months ago in this House, and indorsed by his predecessor, that an effort should be made to prevent the importation into and sale in Australia of goods covered by enemy trade marks and trade descriptions ?
– That point has not been dealt with in detail, but an Order in Council has been passed which gives the Minister of Trade and Customs power to exclude such goods. I might add that the Government has decided to take whatever steps may be necessary to cancel all enemy trade marks.
– Has the Prime Minister received from the Leader of the Opposition, in pursuance of the latter’s oft-repeated declaration that there should be no party strife during the war, any notification that no official recognition or support will be given to an Opposition candidate for the Wide Bay Beat?
– I have not had any communication on the subject from the Leader of the Opposition, towhom, I suggest, the question be addressed.
– On the 3rd inst., the honorable member for Eden-Monaro asked the following question: -
In view of the dissatisfaction that exists in connexion with Liverpool and other Camps in
New South Wales, will he have inquiries made with a view of removing these Camps to Federal territory at Jervis Bay or Canberra, where there is plenty of Government ground, pure water, good climate, and every condition favorable to health, comfort, and economy ?
On behalf of the Minister for the Navy, I furnish the following reply.: - ‘
The Military Commandant, Sydney, who was communicated with by telegraph in . connexion with this matter, reports that the removal of main Camps in the midst of training at high pressure would dislocate the whole system and cause such delay as would affect our obligations to the Imperial Government in the most serious manner. The many improvements which have been carried out at Liverpool at considerable expenditure of public money, the establishment of casual camps on a site universally admitted to be admirable, all tend to remove causes of dissatisfaction. Federal Territory is, moreover, a handicap to training and administration, owing to its distance from principal recruiting centres. Feeding and equipment are costly, owing to difficulty of transport and too far from places of embarkation. Considerable expenditure would also be necessary to prepare and fit Federal Territory for use.
The Minister concurs in the views of the Commandant.
- Mr. Wade, the Leader of the Liberal party in New South Wales, is reported in the Sydney Daily Telegraph, on 19th October, to have made the following statement: -
The people were being ruled by a party which was cultivating in every shape and form privileges for our enemies the Germans. Germans were receiving special privileges at the expense of our own people right throughout the Commonweulth.
I ask the Prime Minister whether he does not think that action should be taken against Mr. Wade for making that statement, which must be doing great injury to the Commonwealth?
– The statement is a serious reflection on the Government. It ib without any foundation. I do not know what action could be taken against Mr. Wade; no doubt public opinion will deal with him. If he. has any definite complaint to make, I shall be pleased to consider it; but such a statement as Mr. Wade makes carries its own refutation, is obviously without grounds, and can only damage the man who made it without hurting the party against whom it was directed.
– I ask the Minister of Trade and Customs if it is a fact, as stated in the Melbourne newspapers of to-day, that the Government, and more particularly the Customs Department, is engaging single young men who in every way are eligible for service at the front. Will the Minister see that this is stopped, and that preference is given to married men?
– A letter is published in to-day’s newspaper in which the statement is made that the Customs Department is appointing meat inspectors - “ a score or two,” to use the words of the writer - and that preference is being shown to Bingie men. When the inspection of meat was under the control of the Government of Victoria, thirty or forty inspectors were employed ; but for the greater part of the time that this work has been under the control of the Commonwealth Government, that is, since September this year, only one inspector has been employed, and he is a married man. Three other inspectors were appointed recently, and they are married, and a fourth was appointed to-day. The man appointed to-day is single, but his qualifications were the main consideration. He will have duties to perform in this State, but will be sent to other States also. These inspectors must possess veterinary certificates, and axe chosen because of their qualifications. The qualifications of the man appointed to-day are infinitely superior to those possessed by any other applicant for the position.
– Many single men have responsibilities as great as those of married men.
– I desire to ask the Prime Minister whether the grant of power proposed to be obtained from the States in connexion with the withdrawal of the referenda is subject to any unwritten understanding or agreement with reference to the war or anything else ?
– No, none.
– Has the Prime Minister considered the possibles effect on awards made by the Commonwealth Court of Conciliation and Arbitration under the extended powers of theCommonwealth, in view of the limited dura- tion of these powers as at present proposed? If so, will the honorable gentleman give us the benefit of his lucubrations?
– I know of no limitations other than those clearly arising out of the limitation of time. The Court will not be in any way limited in its awards, but the period over which an award may operate will, of course, be conterminous with the period for which the powers are granted, subject always to the possibility of a grant of permanent power which the Premiers are to consider at a Conference next year.
– In connexion with the refrigerating space which has been commandeered by the Imperial Government, a considerable increase has been made recently in the rates. Can the Minister of Trade and Customs inform the House, particularly in regard to the new rates for butter, whether the increased rates have been made at the request of the Imperial Government, in the first instance, or by the shipping firms from whom the Imperial Government have secured this space?
– I understand that the shipping firms themselves fixed the rates, but if the honorable member will place his question on the notice-paper I shall endeavour to obtain for him to-morrow a full and complete answer.
– We have recently been informed that the British Government propose to pass legislation whereby abnormal war profits - that is to say, true war profits - will be taxed to the extent of 50 per cent. Will the Prime Minister state whether the Commonwealth Government intend to introduce similar legislation ?
– The Commonwealth Government at the present time has no power to deal with war profits other than by taxation. Our taxation policy for next year will include proposals which will have the effect of reducing profits obtained during the period of the war to the normal average profits obtained before the war.
– Will the Minister of Trade and Customs inform the House - (1) Whether he has any knowledge that manufacturers and others in Australia are endeavouring to expand their businesses so as to supply Australian demands, and thereby supplant the foreigner; (2) what action he intends to take in respect to the suggestions of the Inter-State Commission for new industries in Australia; and (3) whether he has any scheme to assist organization amongst those who could give valuable assistance in establishing new industries in Australia?
– The honorable member forwarded to me this morning a copy of his question. I may say that I requested the Inter-State Commission to be good enough to furnish Parliament with a report as to new industries which, in its opinion, could now be established with advantage in the Commonwealth. I have looked through the items with which the Commission have dealt, as well as othersaffected by the Tariff brought in on’ 3rd December last, and under which the new duties are being collected. Under that Tariff, which is operative, although not yet on the statute-book, an impetus has been given to a great number of industries. This is noticeable in connexion with the furniture industry, and more especially in regard to the manufacture of chairs. An impetus has also been given to the confectionery trade. A very large factory, I am informed, is to be established here, at a cost of about £50,000, for the manufacture of chewing gum. The manufacture of rubber goods has been greatly encouraged, and certain drugs are also being manufactured hero for the first time, as well as small metal wares, corrugated boxes, strawboard and other boards, glucose, ladies’ hand-bags, and many other articles. The Government have under consideration at the present time the proposal to encourage the manufacture of tops, yarns, and the weaving of wool and fabrics from our own raw material. The Inter-State Commission made a suggestion with regard to the introduction of machinery for that industry. Under a Tariff item the Minister has power, subject to departmental by-laws, to admit machinery as machine tools, and the Government have under consideration the advisableness of admitting under that item certain machinery for the top-making and spinning industry, so as to encourage the working up of our own raw material in Australia.
– Under the present Tariff the duty on that machinery has been increased.
– The duties on machinery generally were increased.
– Order ! The honorable gentleman is now going beyond the answering of the question.
– I have only to say that the Government are doing everything possible to expand existing industries, and to encourage the establishment of new ones.
– Is the Treasurer yet in a position to make a statement as to the progress of negotiations with the States in regard to future State loans ?
– Not yet.
– Has the attention of the Prime Minister been drawn to details appearing in to-day’s press regarding the alleged neglect of our wounded soldiers in London? If so, will he state what steps the Government are taking to see that our men receive every care and attention upon their arrival, and during their stay, in England ?
– I saw the statement to which the honorable member alludes, but know nothing of the matter other than through the press. I shall make such inquiries as are necessary - and some evidently are necessary - to ascertain whether there- is any truth in the statement, and shall supply the honorable member and the House with such information as I obtain.
– On 3rd instant the honorable member for Richmond, on behalf of the honorable member for Nepean, asked the Minister for the Navy, upon notice -
My honorable colleague replied that inquiries were being made from the Military Commandant, New South Wales, and that as soon as his report was received the infomation would be made available. I have now, on his behalf, to supply the> following answers : -
– On the 28th ultimo the honorable member for Nepean asked the following questions : -
The following replies have now been received from the Governor of the Bank : -
– Is the Prime Minister aware that permission has been given to the German Commercial Agent in Sydney, Mr. de Haas, to leave the Commonwealth, and that that gentleman will probably endeavour, in America, to arrange further channels for the importation of German goods into Australia? In the circumstances, will the Prime Minister reconsider the permit?
– I know of none of the matters referred to by the honorable member, but I shall see that they do not occur.
– Is the Prime Minister in a position to inform the House if the arrangements in regard to wheat charters have been finalized?
– I have made a complete statement in the press with regard to this matter, and with the permission of the House I will hand toHansard a copy of it, so that the information may be on record for the convenience of honorable members.
Statement relating to the Scheme agreed uponby the representatives of the commonwealth and the States for dealing with the new Wheat Crop.
It gives me much pleasure to be able to announce that the Conference of the representatives of the Commonwealth and the States has agreed upon a comprehensive and workable scheme for dealing with the new season’s wheat crop.
The news will be received with very great satisfaction all over Australia. To the producers and others directly interested it will remove a load of anxiety and the growing fear, justified by the circumstances, that much of the new wheat crop could not be marketed, and that in consequence the benefits of the bounteous harvest would be lost. The presage of this disaster, coming on the heels of last year’s drought, which brought ruin to some and plunged thousands into debt, filled the minds of the farmers with gloomy forebodings. And satisfaction that a workable scheme has been devised is not confined to the man on the land, but will be felt throughout financial and commercial circles. Every thinking man realizes what failure to market our products at reasonable prices means. The position was and is one that needs to be driven home to every citizen. As a community, we live on what we produce; largely we live on what we sell overseas. Last year we suffered from a drought, and so had little to sell, and are many millions to the bad in consequence. This year, although we have not our normal quantity ot wool to sell, we have very much more wheat than we ever hnd before; and prices of wool and wheat are high. Yet, unless we can find means to transport our produce to the over- seas markets, these high prices cannot help us in any way. It was to the solution of this problem that the wheat conference of the Commonwealth and States directed its efforts. It accepted without question that the successful marketing of our products was absolutely vital to our national as well as industrial welfare.
We must sell our products. That is essential. There is no difficulty in finding buyers. The world is clamouring for wheat - the difficulty is to carry the wheat to those who want it. Scarcity of freight is the trouble. Some 25 per cent, of the world’s tonnage is either locked up in enemy ports, or at the bottom of the sea. Another 20 per cent, has been requisitioned by the Admiralty for transport and war purposes. The British Admiralty, so we are informed, has 800 steamers - not including trawlers - and is requisitioning more every day. The enemy’s submarine campaign, although ithas suffered a severe check, is still to be reckoned with. Here, then, is the position: With a greater harvest than we ever have had, calling for nearly twice the tonnage normally required, we find ourselves set an almost impossible task if we are asked to transport our surplus wheat to the oversea markets by the end of June next. By supplementing the freight chartered, and to be chartered, with the Commonwealth fleet (of requisitioned and interned enemy steamers), we entertain no doubt whatever that we can carry all the new surplus wheat crop to market within a reasonable time; but we do not anticipate being able to do this in the first six months of next year. This, of course, is most satisfactory as far as it goes, and it may be said at once that, without the aid of the Commonwealth fleet and the co-operation of the British Admiralty, any attempt to transport the exportable surplus of our new crop would be hopeless.
But the question is only half solved. The Coiference had to consider the position of the farmer who, with wheat to sell, upon the sale of which he is, in fact, depending to pay his way, who cannot sell for six or nine months - for it is certain that the wheat-buying firms would only buy wheat to the extent covered by the freight actually allotted to them, and they would not buy any more until they were allotted more freight, and had sold the wheat they had bought. Let us see what that would mean to the farmer. In December, January, and February, 1013-14. 615,000 tons were exported. Assuming that we are able to obtain an equal amount of freight during December and the first two months of 1916 - we hope to do that, and even more - less than one-half of the estimated amount of wheat available for shipment during that period would be provided for; the remainder would be unable to find transport, and so could not be sold. This difficulty would continue during subsequent months. Other contingencies, too, may arise which would intensify the difficulties of this situation.
We must not forget that the Empire is at war, fighting for her very existence, and every arrangement for transport is contingent upon the exigencies of war. All freight is now subject to requisition for war purposes, and, therefore, there is absolutely ‘no guarantee that ships chartered for the purpose of conveying our wheat or those of the Commonwealth fleet may not be taken by the Admiralty for war purposes. This being so, if we are to avoid disaster, allay uneasiness among producers which may lead to them rushing their wheat upon a local market, which could not absorb it. and so bringing about disaster, arrangements to finance the farmer and to enable him to get, as far as possible, the advantage of the present high prices must be made. This the Conference has done.
The scheme, which, as I have already said, covers every phase of the matter, is practicable, and has enlisted the support of the interests necessary to insure its success.
The wheat-buying firms and flour millers have unanimously approved it, and agreed to work under it. It has been submitted to, and approved by, some of the ablest business and financial men outside of the shipping interest.
Shortly stated, the scheme is as follows: -
The Commonwealth and the respective Statu Governments to control the receiving, financing, shipping, and marketing of the whole of the wheat crop of the wheat-exporting States in excess of seed and feed requirements.
Methods of Control. - The internal State organization to carry out the responsibilities as outlined in the preceding paragraph, to be arranged by the respective State Governments co-operating with the interest concerned. A London Board, representing Commonwealth and States, is to be appointed, which is to have the co-operation of the London representatives of the principal Australian wheat-buying firms. Government agents are to be appointed to receive wheat on behalf of their respective Go- vernments
Agents’ Duties. - The Government agents to receive the wheat at various centres, to issue certificates, to store and safeguard it, to consign it to various shipping ports, to ship it, and throughout, from reception of shipment, to be responsible for weight, quality, and condition of the wheat. On receipt of the wheat the Government agent to issue a storage certificate showing quality and quantity of wheat delivered. Certificates only to be issued by firm’s chief office in State. Quality to be stated in certificate. If inferior, value to be marked.
Advances to Farmers. - Arrangements to’ be made for part payment to holders of certificates on tlie basis of 3s. per bushel f.o.b. at principal ports of shipment. The difference between the amount thus received and the average price received for all the wheat exported from the States, less expenses, including interest, to be paid to the holders of certificates at the close of the season.
London Board. - The selling to be intrusted to a London Board. Selling commission and charges to be paid at the rate fixed. The return from sales of each cargo to be credited to the exporting State. Deliveries of wheat under this scheme to cease on 30th September, WIG, and accounts to be paid up. and final payments to farmers to be made subsequent to the sale of the last shipment, probably not later than 30th November. As soon as possible after the sale of the- last cargoes, the Minister to ascertain the net average price realized for the whole of the wheat shipped by his State, and each farmer to bo credited with this rate on the whole of the amount delivered to the Government agent. Provision is to be made for supplying millers with wheat sufficient for their requirements at a price to be approximately the London parity.
The control of the whole scheme is to be _ vested in a Committee representing the Com- “ monwealth and States, with an Advisory Board of experts.
These are the main principles of the scheme, which, I venture to believe, will commend itself to the producers and to the community in general. It has behind it the resources of the Commonwealth and the States. It is practicable. All the wheat-buyers and millers are cooperating under it. They are satisfied it is a workable scheme, and are determined to make it a success. Under it every farmer will get a fair deal, and there will be no scramble; every producer who desires it will get an advance without waiting for his wheat to be shipped. And he will get, at the end of the season, every penny of the difference between the advance and the average price realized for the wheat exported from his State less expenses. The arrangement covers all sales of the new season’s crop, and on behalf of the Commonwealth, as well as the responsible Ministers of the respective States, I appeal with confidence to all concerned to lend it their hearty support.
– I should like to preface a question to the Prime Minister by saying that as one who felt it his duty to criticise the early negotiations regarding the wheat freights, I believe that the new arrangement made by the Governments will be entirely satisfactory to those engaged in the wheat trade. Will the Prime Minister inform the House what will be the position of contracts entered into for the sale of wheat prior to the Government scheme being brought into effect?
– The Government scheme, to be successful, must cover all wheat and all agencies in connexion with, it. I have not considered the position of contracts made prior to the agreement having been entered into, but I will discuss the matter with the State Ministers of Agriculture. It is obvious that there is a wide opening provided by those forward contracts, and unless we are very careful they may hamper the whole scheme. However, I do not wish to commit myself to any statement at this stage.
– Will the Minister representing the Minister for the Navy lay on the table the name of the doctor who recommended the closing of the Camp at Newcastle.
– I shall bring the matter under the notice of the Minister of Defence.
– Will the Minister representing the Minister of Defence have a statement prepared showing the number of employees engaged in the manufacture of munitions and warlike material, either directly in Government factories or indirectly under private contracts ?
– The question will be brought under the notice of the Minister of Defence.
– Will the Minister of Trade and Customs inform the House whether members of the Expeditionary Forces have any privileges regarding the sending of dutiable goods into Australia ? If so, what are the privileges, and what the restrictions?
– Some time ago the Government announced a decision to allow soldiers on active service to send into Australia dutiable goods to the value of £10. The fact hag come under the notice of the officers of the Department that soldiers are taking advantage of that concession to send into the Commonwealth cigarettes, tobacco, and cigars. The permit was intended to apply only to curios, but certainly not to narcotics and stimulants.
– On Wednesday last the honorable member for Bendigo asked the following question: -
Will the Minister for the Navy ask the Minister of Defence to reconsider his decision in reference to the return of uniforms by returned soldiers, and consent to allow those soldiers with good records to retain, during good behaviour, the uniforms in which they fought at Gallipoli as a memento of their achievement T
On behalf of the Minister for the Navy, I now beg to furnish the following reply: -
The Minister has decided that sick and wounded’ soldiers from active service will be allowed to retain their uniforms on discharge. Instructions to this effect will shortly appear in Military Orders.
On Thursday last the honorable member for Dalley, for the honorable member for Melbourne, asked the following questions : -
In reply to inquiries which were then being made, I, on behalf of the Minister for the Navy, am now able to furnish the following replies: -
– Has the attention of the Postmaster-General been called to a statement published in the Mirror, Sydney, that sixteen mail bags of pamphlets containing matter written to the soldiers, were sent from the Khaki branch of the Red Cross Society to a mill to be destroyed, and that, because the employees of the mill refused to destroy the pamphlets, they were dismissed 1
– In the absence of the Postmaster-General, I will cause inquiries to be made.
– Can the Minister of External Affairs give the House any information as to the present position of the contract with Vestey Brothers for the erection of freezing works at Darwin?
– No recent information regarding that matter has been received by the Department. Vestey Brothers have had every facility afforded them by the Department, and, so far as I am aware, the work is proceeding satisfactorily.
– In view of the undeservedly bad reputation that some of the Australian reinforcements have received through the misconduct and excessive drinking on the part of a small proportion of the men, I should like to know whether something could not be done to put the non-drinkers in a company by themselves?
– I shall have the honorable member’s representations brought under the notice of the Minister of Defence.
– Is the Treasurer aware that the Commissioner of Income Tax has intimated that he will not permit any deductions for commission paid by people who own property on the rents collected? If he is aware of that fact, will the Treasurer inform the House tomorrow what are the reasons which induce the Commissioner to treat this commission in any different way from other wages paid for services rendered?
– I shall endeavour to give a reply to the honorable member’s question to-morrow.
– A statement in the Sydney Sunday Times shows that the inference has been drawn from the Treasurer’s speech in this House that there is some idea of reducing war pensions. I ask the Treasurer to give a disclaimer to this ridiculous suggestion.
– I do not see that the newspaper could deduce anything of the kind from my remarks. I said that the £500,000 set down for these pensions was a guess, and I pointed out the difficulties that confronted us in making an estimate. For instance, a soldier may die without leaving a will, and his relatives may at that time be well off; but, subsequently, they may be reduced in circumstances, and, should that be the case, it would be the duty of the Commonwealth to look after them.
– You do hot propose to reduce the pensions?
– No; we do not propose anything of the kind.
– Can the Minister of Trade and Customs tell us whether it ia proposed to proceed with the consideration of the Tariff at an early date?
– I do not think that the Tariff will be considered this year, in view of the fact that we have only seven weeks to run.
– Have the Government decided the date when they intend to introduce the initiative and referendum proposals in this House?
– There is great need in this country for a man with a bag - a bag capacious, bottomless - in which to put people who ask such questions.
– In view of the fact that a satisfactory and universally accepted solution has been found of the difficulties presented by the. problem of dealing with this season’s wheat, will the Prime Minister arrange for immediate consideration to be given to a scheme for inducing and assisting farmers to conserve increased quantities of hay and to harvest as much of their grain crops as is possible by cutting and threshing methods?
– As far as the Commonwealth is concerned, any action in this matter would be of little or no avail unless we had the co-operation of the States; but I will put the honorable member’s suggestion before my colleagues at the Wheat Conference, and as it appears to me to be a proposal that, prima facie, is desirable, I will suggest that favorable consideration be given to it.
– In view of the splendid services rendered to our wounded soldiers at Gallipoli by the now famous donkey christened “ Murphy “ by the soldiers, and by its late owner, Private Collins, will the Minister representing the Minister of Defence take into consideration the advisability of having the donkey brought to Australia, and placed in one of the zoological gardens so that it may be well provided for?
– The supply of donkeys in Australia is, I believe, so large that an Act has been passed refusing admission to any more.
– The honorable member for Fremantle the other day asked whether it is the intention of the Government to grant old-age pensioners resident in State institutions the balance of their pensions after payment of the amount due to the State for their support. The Government have decided to pay the amount in each case. Where an institution receives 8s. per week, and the pensioner is entitled to a pension of 10s. per week, the pensioner will be paid the difference of 2s. per week. On account of the difficulty of the Commonwealth Bank reaching each individual pensioner, the institutions concerned will receive the full pensions and be asked to pay the balance due to pensioners.
– On Wednesday last the honorable member for Wilmot asked the following question : -
Can the Minister for the Navy saywhether the Government have decided upon the establishment of a munitions factory at Beaconsfield, in Tasmania?
On behalf of the Minister for the Navy, I now furnish the following reply: -
It is . the policy of the Government to establish Government Munitions Factories on Federal Territory at Canberra. The Federal Munitions Committee will be pleased to place all information available at the disposal of public or private bodies’ contemplating the establishment of munitions factories in other parts of Australia.
– On Wednesday last the honorable member for Richmond, for the honorable member for Wentworth, asked the following questions: -
On behalf of the Minister for the Navy, I am now enabled to furnish the following information: -
Captain J. R. Charlton, Lieutenants W. J. T. Wells, M. W. S. Wilkins, A. A. O’Connor, H. J. J. Rigney, and J. L. H. Macaulay (not an officer of A.S.C. Is serving in 25th Infantry as transport officer).
Captains J. R. Charlton (N.S.W.), J. Murray, and S. A. Robertson; Lieutenants E. R. Graham, W. J. T. Wells (N.S.W.), H. J. J. Rigney (N.S.W.), T. A. David, M. W. S. Wilkins (N.S.W.)
Supply of Stretchers
– On the 29th ultimo the honorable member for Richmond asked the following questions: -
Inquiry has been made, and a report to the following effect received from the District Commandant, Sydney: -
The whole matter is being further inquired into.
asked the Treasurer, upon notice -
– The answers to the honorable member’s questions are as follow: -
asked the Treasurer, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the Minister of Home Affairs, upon notice -
Whether he proposes to submit to the Public Accounts Committee the question of the creation of a Supply and Tender Board in order that the Committee may investigate the working of such Boards in the various States, and recommend a system which shall combine all the best features of existing Boards elsewhere ?
– The purchase, supply, and distribution of stores is dealt with in the report recently furnished by Mr. R. McC. Anderson, and the question of referring the matter for report of the Public Accounts Committee will be duly considered as early as possible.
asked the Prime Minister, upon notice -
Will he provide members who request it with a copy of the printed evidence of the Boya! Commission on the management of the Liverpool Camp?
asked the Minister of Home Affairs, upon notice -
Whether he will take into consideration the advisableness of securing sufficient Australian timber for all Federal requirements and of seasoning the stocks for the use of the Commonwealth ?
– The matter has already received consideration, and a start has been made - some thousands of pounds’ worth of timber is now being seasoned at Canberra, Maribyrnong, Victoria, and Newington, near Sydney. The question will be kept in view.
asked the Treasurer, upon notice -
Will he furnish the House with a statement showing the names of all officers who are receiving payment from the Defence Department and, in addition, are employed in the Commonwealth and State Public Service, with the salaries paid to them severally by the various Departments ?
– The Defence Department has been asked for the information, and the honorable member will be furnished with a reply later.
Mr. SPEAKER reported the receipt of a message from His Excellency, the Governor-General recommending an appropriation for the purposes of this Bill.
The following papers were presented : -
Arbitration (Public Service) Act -
Electoral Act and Referendum (Constitution Alteration) Act -
Regulations Amended (Provisional) - Statutory Rules 1915, No. 219.
Inscribed Stock Act - Regulations (Provivisional) Statutory Rules 1915, No. 207.
Kalgoorlie to Port Augusta Railway Act - Goods Rates (Water Haulage, &c).
Lands Acquisition Act - Land acquired under, at-
Heidelberg, Victoria - For Postal purposes.
Majura, partly in Federal Territory and partly in New South Wales - For Federal Capital purposes.
West End, Townsville, Queensland - For Defence purposes.
Naval Defence Act - Naval Forces - Regulations Amended (Provisional) - Statutory Rules 1915, Nos. 217, 218.
Ordinance of 1915 -
No. 6- Customs Tariff.
Public Service Act - Promotion of A. P. Westhoven, as Inspector of Accounts, 1st Class, Central Staff.
Debate resumed from 5th November (vide page 7306), on motion by Mr. Tudor -
That this Bill be now read a second time.
.- This is a technical Bill, and I think that a few minutes be sufficient for my criticism of its general provisions. I notice that the estimated revenue from the income tax, which was made by the exTreasurer a few months ago, has been reduced from £4,000,000 to £3,000,000; but, considering that the total of the loans authorized, and the amount asked for locally, apart from what has been obtained from the Imperial Government is £38,000,000, no doubt the lesser sum will be sufficient to pay interest and a fair sinking fund in respect of our local loan obligations. To what extent the borrowings from the Imperial Government are affected we have yet to learn; probably the Minister will tell us in due course. Before dealing with the clauses of the Bill, I ask honorable members to consider the question of the taxation of State securities. We are left in doubt as to the policy of the Government in relation to the taxation of State securities, and do not know what will be the decision of the High Court or of the Privy Council on the question, whichever tribunal may finally deal with it. The decision might follow the lines of a recent decision of the Supreme Court of Canada, to which I drew attention when speaking on the second reading of the principal Bill. In America, they have decided, with a fair amount “of consistency, that the doctrine of instrumentalities applies to bonds of a State Government and of Congress, or of any public authority created under a State or Federal Act. In the recent Canadian decision, that doctrine, in so far as it relates to the taxation of Federal officers by provincial assemblies, was not followed by the Supreme Court. But it is not fair to the public of Australia, when we can settle a difficulty of this nature, not to ‘ do so. We should declare our meaning in this matter. If, after an Act has become law, a point of interpretation arises, there is, as a rule, thrown on the taxpayer who ‘objects to the incidence of a particular tax the obligation of bringing the matter to trial before a Court, and he then has to pay the piper for a good many others, who thus have their affairs cleared up without contributing one penny towards the cost of the solution. We are now in a position to state definitely what the law shall be; whether we shall or shall not tax the bonds of the States. I understand that it is the policy of the Government to leave the matter to the determination of the Courts, but why should not the Attorney-General avail himself of Part XII. of the Judiciary Act, which permits of points of this kind being raised for immediate determination by the Court; that is, before litigation has arisen between interested parties? I ask the Treasurer to put the matter before his colleagues, because it is really one of substance; indeed, with all due respect to the Minister, I think that this matter is of far more importance than some of the proposed amendments. I do not think it fair that taxpayers should not be informed whether they should return income derived from State securities. Any decision on the point will apply, no doubt, to both State and Commonwealth securities; in other words, if it be decided that we have the right to tax State securities, it will follow that the States have the right to tax Commonwealth securities, though in the war loan prospectus and in our War Loan Act wa have assumed that we have the power to tax State securities without the States having the power to tax Commonwealth securities. There is another matter which 1 should like the Minister to consider - the alteration of the date on which returns must be furnished. We are altering the mode of assessment in important particulars, and it will be difficult for many of those who are now preparing their returns to alter them in accordance with the amending Act, and have them ready by the date fixed. In some cases, information will have to be obtained from England. A good many persons are in doubt as to what the position will be, and, unless the date is publicly altered, applications will be received from all quarters asking for an extension of time. The Commissioner of Taxes endeavours to meet the public fairly, and an immediate notification of the alteration of date should be made. The first clause of theBill . deals apparently with the taxation of companies. There are two defects in the Act as it stands. One provision leaves it doubtful what is the source of income derived from a company. Section 10 provides that income tax shall be levied and paid upon the taxable income derived directly or indirectly by any taxpayer from sources within Australia. When the Bill was under discussion the honorable member for Darling Downs and myself drew attention to the fact that the meaning of source of income derived from a company was doubtful. It was decided that the location of the head office of a company should determine the place whence the income from that company had come, and an amendment is now proposed to declare that where the head office is located abroad, the tax shall fall, not upon the whole of the income derived by the shareholder resident in Australia, but upon that portion which has come from Australia. Similarly, if the head office is here, and some of the income earned has been earned abroad, there will be a fair apportionment as regards the tax.
– Is it. not a new proposal to tax transactions which are not completed here?
– They do the same thing in England; indeed, I think they have gone further. I read the report of a decision published in the Economist, which has not yet reached us in the Law Reports , in which this principle is applied to dividends derived from Egypt. I do not think that we are dealing in an extraordinary way with the operations of companies, and, therefore, I cannot criticise what is being done.
– We are merely going beyond what we have done before?
– In this instance, an attempt is made to achieve clearness. Another matter arises regarding apportionment. The proviso in section 14 declares that where a company distributes to its members or shareholders any undistributed income accumulated prior to the commencement of this Act, the sum received by the member shall not be included as part of his income. This provision is to be made so that it shall apply only to income that was undistributed prior to the 1st July, 1914, that being the date of the commencement of the year in respect of which the tax is levied. The fixing of the date is fair enough, but difficulties will arise as to what is meant by the proviso, and the matter should be carefully considered. The section speaks of “ income received by any member.” The operative part of the section says that the income of any person shall include profits derived from any trade or business. That applies to income whether received or not. Section 10 says that income tax shall be levied or paid in and for each financial year upon taxable income “ derived “ - “ derived “ being the dominant word. I think “derived” is the word governing the interpretation of the other clauses dealing with the levying on income.
– “Would the word “ derived “ cover an indent case in which the transaction was completed in London ?
– I shall deal with that a little later. Section 18 says that in calculating the taxable revenue of a tax-
Sayer, the total revenue “ derived “ by im shall be taken into consideration, and section 28, that for the purposes of assessment and levy of income tax every person who has a total income “ derived “ from all sources shall make a return. We create confusion by the wording of section 14 and the proposed amendment. What is meant by dividend received? Do the words mean dividend derived? This is a vital matter. By Acts of Parliament which have been adopted in all the States, dividends are now held to accrue from day to day. When a dividend is declared after the death of a shareholder, the point arises what is the period in respect of which the apportionment between those who succeed to his estate and the remainder men should be made? What part of the income tax should be given over to the executors as part of the general estate or capital of the deceased, and what part should be paid to those who succeed after his death as remainder men? Difficulty arises in respect of the period from which apportionment shall take place. Is it the period between the last payment and the next date of payment, or the period between the one declaration of dividend and the next, or the period in respect of which it is declared ? I shall not deal further with the matter now, but the difficulty should be cleared up. A good many men do not know what the proviso to section 14, in respect to the receipt of dividends, really means. I need not worry honorable members with a discussion of other parts of the Bill, which, fortunately, happen to be clearer. The Leader of the Opposition has asked a question as to indents. I take it that clause 3 deals with indent transactions. It provides that if goods are imported in consequence of sales effected here bv an agent who is paid a commission or salary, then the Act shall apply to them. In other words, the tax will fall upon the income represented by 5 per cent, on the proceeds of the sales. If, however, goods are imported from abroad, not through an agent, or through an agent who receives no pay, then income tax will not fall upon the transaction, since it would have been completed outside the limits of Australia. Clause 5 provides that section 18 of the principal Act is not to apply to the section which declares what deductions may be made by a taxpayer from his gross taxable income. It is provided in section 18 that all losses and outgoings, including commission, discount, and travelling expenses, interest, and expenses actually incurred in Australia in gaining or producing the gross income may be deducted. The amendment declares, however, that these outgoings are not to be in the nature of losses and outgoings of capital. If, say, a man invested £10,000 during the year, and lost the whole amount, he could not make that deduction, because similarly, if, as the re.sult of his investment, he had increased the £10,000 to £15,000, he would not have been taxed upon the increase, because it would have been an increase of capital. But let us consider the position of brokers who buy and sell. The law of most of the States at the present time provides that they can make such deductions, because they relate to what is part of their ordinary business; whereas an ordinary investment would not be part of the investor’s ordinary business. This amendment willi exclude that practice of the States, and money agents and brokers, in endeavouring to make £250 a year, may lose £2,000. This is not fair. I ask the Treasurer to look into the matter, because, under the Bill as it stands, many of these men would be hit very hard if they were not permitted to make these deductions.
– I shall have the honorable gentleman’s argument brought under the notice of the Attorney-General.
– The last’ amendment of the principal Act to which I shall draw attention is that embodied in clause 8, which provides that when a taxpayer dies on or after the 1st July before furnishing a return of his income from the preceding year, his executors or administrators shall furnish a return of the income derived by him during the said preceding year, and shall be assessable in respect thereof, and chargeable with and pay tax thereon. That, I think is a fair DOS1.tion. There was a flaw in the Act as originally passed. It merely provided that where a man died, say, last February, the tax should be levied on that proportion of his income which was received by his executors from the date of his death; but that portion of his income which was earned during the preceding months was free from taxation. That, defect this clause attempts to cure; but I do not know that it will. Could it be said that a man who died in February last was a “taxpayer” within the meaning of the Act? This amending clause deals with the “ taxpayer,” just as the principal section does. I draw attention to this point, because it would be a pity if this attempt to remove a defect in the Act were not a complete success. There is another amendment of the principal Act which so deals with returns as to make absentees liable to furnish them. I had my doubts as to whether such persons were really liable when the Act was passed. Whatever doubt existed on the point, however, will now be removed. These are the technical considerations that have occurred to me, and I have drawn attention to them with the view of helping the Department.
Debate (on motion by Mr. CARR) adjourned.
In Committee (Consideration of GovernorGeneral’s message resumed from 4th November, vide page 7225, on motion by Mr. Higgs) -
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 £18,000,0000 for war purposes.
.- Before proceeding to criticise the financial statement submitted by the Treasurer in moving this motion, I desire to congratulate the honorable gentleman upon his attaining the position he now occupies, because, whatever we may think of his statement from a financial point of view, I am sure we are all agreed that he will give to his office the best that is in him, and that he will do his duty conscientiously. The Treasurer, in submitting this motion, said, amongst other things -
I think the Commonwealth note issue has proved of the very greatest possible value to the community during this great crisis. It has freed Government and private finance from a great strain; but the experience of nations has shown that its sphere of usefulness is limited. I am not in favour of an unrestricted issue of paper money.
We have reached a strange pass when the Treasurer of the Commonwealth feels impelled to make the bald statement that he is not in favour of an unrestricted issue of paper money. Surely the day has long since gone when any one, whether he be the Treasurer or a private member, could for one moment think of speaking in the National Parliament in favour of an unrestricted issue of - paper money. Since the honorable gentleman saw fit to make this announcement, I propose today to deal with a few more or less elementary principles which I never thought would need to be handled in an assembly such as this is. The Treasurer stated that the total Australian note circulation on 13th August, 1914, was £9,854,923, of which the banks held £5,032,149 and the public £4,822,774. He stated, also that on the 20th September last the note issue amounted to £36,288,594, of which the banks held £26,389,849 and the public £9,898,745. In other words, from 3rd August, 1914, to the 20th September, 1915, the Australian notes in the hands of the public a little more than doubled, whereas the banks increased by five times their holdings of the notes. That, in itself, seems to me to indicate a very serious position. We are placing the banks in a position in which they are not fully able to safeguard themselves. The Government are so forcing out paper money that the banks have to absorb it at a far greater rate than they would do under normal conditions, and they are now forced to part with their gold to a far greater extent than they ever intended or would have wished to do under normal circumstances. They have still to part with £2,750,000 more gold to the Commonwealth, and to take Commonwealth Bank notes for that amount. In normal conditions, a bank may safeguard itself
– The Commonwealth would have had to borrow more money.
– The Commonwealth Government, instead of forcing the banks as they have done to make money so much dearer to the people of the community, might have readily adopted another method of meeting the difficulty. An issue of bank notes can be excessive in two distinct ways. It can be excessive either as against the amount of metallic reserves, or as against the amount required for trade and commerce. In this particular instance, the note issue is excessive in both respects. As already shown by the Treasurer’s statement, the Commonwealth Bank notes in issue on the 3rd August, 1914, were a little over £9,000,000, whereas to-day they amount to over £36,000,000; and it is estimated that on the 30th June, 1916, the Commonwealth notes in issue will represent £45,783,000. Before the outbreak of war, the note issue was only £9,000,000, and it is very plain, therefore, that our trade and commerce cannot properly absorb £45,000,000 of paper money. The position must be brought about here that has been created in every other country which has had an excess of paper money : The result of this excess is that gold is forced out ‘of the community - that it goes abroad, and prices rise. That occurred in France 200 years ago. It occurred in Italy twenty years ago, and it has occurred in every country that ever tried to force a paper issue. Not only does the gold go out of the country, not only are the people in the country charged more for the use of money, but prices rise because we have too much of one commodity, and not enough of another. Under ordinary conditions, without the Commonwealth having experienced a severe drought, we should have been able to absorb without any danger considerably more money than we can absorb at the present time ; but our trade has been damaged by the tremendous drought which raged throughout the Commonwealth last year, and which still exists in a most acute form in the north of New South Wales, and practically over the whole of Queensland. Our trade and commerce, and the amount of raw products handled, are very much reduced owing to the bad seasons. Even under ordinary conditions we should have had great difficulty in absorbing what is considered to be the ordinary circulation in Australia, namely, from £12,000,000 to £14,000,000, but when our trade and commerce are reduced, and we yet have to absorb a total of £45,000,000 worth of paper money in addition to other currency, it seems as certain as daylight that the effect will be to force uo considerably further the cost of living. I wish to impress upon the Treasurer and the Government that they should, as far as possible, keep the paper money within bounds, because there are not only the dangers which have been proved over and over again in other countries - the driving out of the gold and the depreciation of the notes - but in the meantime we shall be putting a greater burden on those who already are finding the burden becoming heavier and heavier. These are great days for the single man, but it is a hard time for the man with a family. The cost of living is rising at an alarming rate, and the Treasurer’s War Loan statement indicates that the Government are moving in such a way as will assuredly lead to a further increase. The Treasurer has told us that the reserve of gold amounts now to about £14,000,000, and that by the time the £45,000,000 worth of notes is in circulation the reserve will be between £16,000,000 and £17,000,000. I desire to know if the Treasurer cannot devise means by which there shall be a greater reserve against the £45,000,000 worth of notes when that total is in circulation. Because, -unless we have that greater reserve, we shall be placing ourselves in the unfortunate position, that should a financial crisis come, the Commonwealth will be unable to meet it. It is all very well for people to say that 25 per cent, of gold is a sufficient backing against a note issue, but proof has been provided over and over again that such a reserve is not sufficient. We need only look back twenty years to see how Italy, which had reduced its gold reserve to about 28 per cent., found itself in the greatest financial difficulty, from which it escaped only when it raised the gold reserve to 40 per cent. Some people are under the impression that a strong gold reserve is not necessary in these days of extended credit, and that the money lying in the reserve is idle. In reading Conant’s History of Modern Banks of Issue I noticed the following statement, which seems to bear with great force on the present position : -
The Bank of France was reproached for locking up so much unproductive capital. A little reflection would show that its presence in the bank vaults had procured for several thousands of millions of commercial paper circulating in France a rate of discount lower by 3 and sometimes 4 per cent, than that of neighbouring countries.
Unless we have a strong reserve behind our bank notes we shall raise the rate of discount, interfere with the trade of the community, and force up prices, in addition to the fact that the Government, have already interfered with the ability of the banks to lend their money at reasonable rates. The next point I wish to deal with is the statement made by the Treasurer, that the annual amount of interest returned on the present investments of the Commonwealth note fund is £1,018,280. On paper, that result looks very good, and, no doubt, a great many people would believe that the interest on the debt was reduced by about 1 per cent, on account of the amount the note fund is earning. But an analysis of the situation shows that Commonwealth inscribed stock represents £3,830,000 ; New South Wales funded stock, £800,000; Victorian Government debentures, £784,000 ; Western Australian stock, £590,000 ; Western Australian Treasury-bills, £41,250; Tasmanian inscribed stock, £460,000; advances to banks, £211,000; Commonwealth Treasury-bills in aid of revenue, £311,904; and Commonwealth Treasury, for loan purposes, £2,482,227. The whole of that money, with -the exception of the advances to banks, is merely transferred from one public pocket to the other. No real gain is to be made out of any of these transactions, for the people are only lending the money to themselves. That point cannot be too strongly emphasized. When the Commonwealth lends money to the States, the Commonwealth will profit, but the people of Australia still have to provide the money to pay the interest. So that the earnings of the Note Issue are, to a large extent, mythical. I hope that the Treasurer will make the fact plain that where Commonwealth notes are put into Commonwealth investments they actually earn nothing, although on paper they appear to be earning interest, and that where they are invested in State securities they earn money for the Commonwealth, but that money is provided by the people of the States, who are also the people of the Commonwealth. Later, the Treasurer challenged members of the Opposition to mention any possible economies, and he proceeded to say -
A sum of £13,299,330 has been expended on public buildings, and this item might suggest itself to some minds as a fine field for economy; but it is the duty of Governments to set in normal times a good example to private citizens.
That is a fine expression of opinion, but it is not called for at the present time -
I do not, of course, speak of this crisis when economy is a primary duty in private as well as public spheres. If public buildings have no claims to architectural grandeur, private citizens cannot be expected to build beautiful homes, and the nation will be the loBer by the erection of the unworthy and commonplace, however economical.
At this time, when we are in the throes of a life and death conflict, we ought to be prepared to put up with the commonplace. We should be ready to cut our expenditure to the very bone, and pub the whole of our strength into overcoming our opponents, saving civilization, and holding Australia for the white people. A pious expression as to what should be done in ordinary times is simply a cloak for Government extravagance. The Treasurer continued -
Would honorable members opposite curtail the State loan expenditure on the development of mines, advances to settlers, loans to local bodies, &c?
In my opinion, some of “the loans to local bodies might be very easily curtailed. At this period no money should be expended unless for directly produc- tive purposes, or to further our interests in the great war. In a detailed statement of the expenditure he mentioned these items -
Redemption of Northern Territory loans, £581,625.
Redemption of Port Augusta railway loans, £12,015.
I take it that those loans must be redeemed ; therefore one cannot take exception to that expenditure.
Plant for Cockatoo Island, £232,670.
Cockatoo Island seems to be a perfect sink for money. From the manner in which money is being poured into that place one would think that by now the whole of Sydney Harbor must be paved with gold. Yet if this expenditure can be shown to be connected with the war I will not say a word against it.
Post Office conduits, £373 520.
Land, Federal Territory, £100,000.
I do not know whether that is an obligation that must be met this year.
Railway, Pine Creek to Katherine River, £180,000.
And the House voted another big sum last week for the same railway.
Land for Post Office purposes, £50,000.
Railway, Kalgoorlie to Port Augusta,
Railway, Katherine River to Bitter Springs, £50,000.
Railway, Kalgoorlie to Fremantle, £100,000.
In regard to the last-named item, it is proper to ask why Western Australia does not find the money for the construction of that railway. Why should the State apply to the Commonwealth for that amount? Having regard to the whole of those items, is there one which could not stand in abeyance? What is the use of our continuing to spend money in this way at a time when the whole future of Australia is at stake? Unless we put all our efforts into winning the war we may be only building up these works for other people. When the Treasurer challenges us to mention where economies can be practised it is only fair to point to those items which though, no doubt, very right and proper under normal conditions, seem to be at the present time, if not a sheer waste of money, at any rate a misdirection of public funds. In regard to the final item of £120,000 for the London offices, whatever may be said about the integrity of Australia - even though we believe that this country is absolutely safe from invasion by the
Huns - there must still remain a doubt about the wisdom of spending a large sum on buildings in London at this critical period. On any night bombs may rain from the clouds, and the whole building disappear in smoke. The money might be spent more advantageously in Australia in forwarding our defence preparations or improving the conditions of soldiers going to the front. The Treasurer also made the remark, “ There is no large leisured class in Australia; nearly everybody works who can get work to do.” After all we have heard from the Government side about the man who lives on the labour of his fellow man, and about the fat man who does nothing to earn the money he spends, such a statement coming from the Treasurer is most refreshing, and seems to be a happy augury for the future. The Treasurer went on to say -
I submit these reflections to investors who may be anxious as to the future, and who, perhaps, have been influenced by articles in the reviews which suggest that after the war the public of Europe may repudiate the colossal public war debt now being incurred in European countries.
It seems to me that a statement such as that would very much better have been left unsaid. We all know that there have been repudiations by countries in the past; and such a thing ought never to have been suggested in the present case. The mere making of such a statement is a grave error on the part of the Treasurer of a great community like ours.
– I have shown how we can pay our debts; we are the greatest gold producers in the world.
– We certainly ought to be able to pay our debts; but if the Treasurer goes on issuing paper money at the pace at which his predecessor did, it will become doubtful whether we shall be able to do so; at any rate, no question of repudiation ought to have been raised. The Federal Treasurer has not been long enough in office to feel his feet, but his predecessor made me think more than once of an unreliable horse in a boggy county; he started, trembled, hesitated, and plunged in such a way as to make difficulty inevitable. When the present Treasurer does find his feet, I hope he will find them on firmer ground. The Treasurer further said -
I desire here to mention the valuable assistance given by the financial institutions, the Stock Exchanges, and the press throughout Australia.
This statement, together with the other one about our having no large leisured class in Australia, reminds one most forcibly of the old couplet -
When the devil was sick, thedevil a saint would be;
When the devil grew well, the devil a saint was he.
I hope that, when things are smoothed out after the great crisis, the Treasurer and those associated with him will remember the statements that he has made on this occasion, and realize to the full, by the legislation of the Government, and their attitude to the community, that these statements are undoubtedly true and correct. There is only one way in which we can make sure that Australia shall meet her obligations, and that is by increasing production. Trade statistics of late years have been very badly against us. Last year, in the case of merchandise, the imports showed a decrease of £15,000,000, and the exports £23,000,000- a difference of £8,000,000. From 1891 to 1913, the exports continuously exceeded the imports, and in one or two cases, notably in 1904 and 1906, did so by over 50 per cent. In 1913 the exports represented 98.5 of the imports, and last year they represented even less. It will be seen, therefore, that the position is becoming positively serious. It is all very well for the Treasurer to say that Australia will not go back on her obligations; but, unless we look the situation in the face - unless we see that production is increased, and alter our luxurious and expensive way of living - we shall have some difficulty in doing so. There is grave fear on the part of many people that, as soon as the war is over, there will be great financial crisis. It seems to me, however, that when the war is over, some little time must elapse before these crises arise; and I think that, if our affairs are handled properly, there need be no real trouble here. When the ex-Treasurer made the agreement with the banks in connexion with the £10,000,000 in gold on account of bank notes, he gave the banks twelve months after the war in which to settle up ; it was agreed, in effect, that for twelve months the banks should be able to use the credit of the Commonwealth. We in Australia will have, at any rate, twelve months after the war, and possibly longer, in which to have a really good time. There should be a great demand for our pro ducts, for Australia is now being advertised as it never was before. Before our boys proved themselves at the Dardanelles and in other parts of the world, many people would have had to consult the map to find where Australia was; but I fancy there are very few in the civilized world to-day who do not know where Australia is, and for what it stands. Altogether, I think that if our affairs are handled properly, we shall have a prosperous and progressive time after the war, in view, not only of the great demand for our primary products, but of a great influx of desirable immigrants. Only one trouble can assail us, and that is the bad handling of our finances.
– I do not think we shall get many immigrants after the war, for men will be required for the development of their own countries.
– We have heard that sort of thing before. After all, the deaths owing to the war, numerous as they appear, are not anything like so numerous as those which occur under conditions of plague and drought in various parts of the world. The deaths from the war are brought before our eyes in all their horror, and we realize them fully; but I think that plague, drought, and shortage of food are, at times, responsible for quite as many. There will still be plenty of people left when the war is finished, and plenty to raise the country to a great height of prosperity under new ideals and methods. We must cut away luxury and waste at the top, and idleness at the bottom; people are now realizing their responsibilities, not only to themselves and their families, but to their country and the world at large ; and I hope that the present Treasurer will realize the responsibility that devolves upon him. He should see that we are placed on a thoroughly sound financial basis, and that when we return once more to the ordinary ways of trade and commerce, we shall be able to take advantage of all the opportunities that will present themselves - to take full advantage of the possibilities of Australia, and the advertisement that it has received throughout the world.
Question resolved in the affirmative.
Resolution reported and adopted.
That Mr. Higgs and Mr. Hughes do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Higgs, and read a first time.
Motion (by Mr. Higgs) proposed -
That the Standing Orders be suspended to enable the remaining stages to be passed without delay.
– The Treasurer might favour the House with some reason for the urgency of this Bill. It is customary to do so, more especially when the Leader of the Opposition is absent.
Question resolved in the affirmative.
Motion (by Mr. Higgs) proposed -
That the Bill be now read a second time.
– I regret very much that the Committee stage has been passed. I take it, however, that the whole scheme of Government finance is still open for review, and that the discussion on the principles of this Bill will necessarily and naturally have relation to the whole financial proposals of the Government, so that, after all, not very much has been lost by the steps just taken, which, I confess, were a surprise to me. In connexion with this proposal to borrow another £18,000,000 for war purposes, the Minister submitted to the House a memorandum setting out a general financial statement that, I presume, is to take the place of the ordinary annual Estimates. For the life of me, I cannot understand, even yet, despite all the explanations that have been offered, why the ordinary Estimates have not made their appearance. The only reason offered so far is that certain payments are being made by the Imperial Government, and that no account of these has yet been submitted to this Government. May I say, with all respect, that no excuse for the non-production of the annual Estimates concerning the civil administration of a Government could be more trumpery or less conclusive than that is. Why cannot an estimate be made of the probable outgo in this connexion? Our own authorities surely know what the soldiers at the front are costing. They know what the Imperial Government will probably have to pay. They ought to know it, and they do know it, to a man ; and just why we should wait for this account to be submitted in detail by the Imperial Government before the Estimates are submitted to this House I cannot for tho life of me understand. Suppose the Imperial Government renders no account for many months. Are we, then, to have no Estimates at all within the financial year ? To my mind, the whole thing is preposterous. I cannot understand why there should be any obstacle in the way of the production of the ordinary Estimates to this House. Has the Minister any idea when they are likely to be submitted? I take it that when the House rises we shall adjourn over Christmas well into the New Year. I have, indeed, heard March mentioned from that side of the House as the probable date of the re-assembling of Parliament.
– Make it June!
-Make it June,” says the Minister of Home Affairs, who would like to be left alone in his Department for many months to come. If we make it June, then the whole year will have passed without any Estimates of any kind having been submitted to this Chamber.
– Does not the honorable member think there will be much important work to be done early next year?
– I think there will be important business. That is why we should get an important matter like the Estimates through this year.
What I want to point out to the House is that in postponing the Estimates in this manner we are losing our control over the civil administration - the ordinary services of the Government - and there is no need to do that, notwithstanding that war is here in all its red ruin and horror. There is nothing to prevent our looking into all the Government Departments and scrutinizing their expenditures. Eather by reason of the war is there greater need for closely examining our ordinary expenditure, which is going on day after day without any attempt being made to check it. Nothing is being done to cut down unnecessary expense.
– Does the honorable member think that the unions would consent to any reduction?
– I do not think they would.
– Why should they?
– Why should the honorable member show any consideration for the taxpayers of this country ?
– Why should the right honorable gentleman ask the workers to submit to reductions of wages, and nobody else?
– I am not asking the workers to do that. What I say is that all extravagance in all civil occupations in this’ country, and in all branches of the Government, falls with crushing effect on the working men of the country. If our Estimates are swollen by £4,000,000 or £5,000,000, that is £1 per head of the population. By the time the effect of the increase reaches the working men of the country, the amount is well on to 30s. or £2 per head. If the honorable member thinks it will be a good thing for the working men of the country for extravagance to continue, why does he not double the Estimates, and bring down a Bill for twice the amount now sought ?
– Point out the extravagance.
– Point it out! How can I point it out when the Estimates are not here ? The honorable member will not permit me to point it out. Perhaps he does not desire it to be pointed out. All I can do is to discharge my obligation to the country - including the working men of the country - in this matter. If they are content, at all events I shall have carried out my task. But I do protest that the House is losing its control over the country’s finances.
– It has lost it.
– And the result is seen in the swollen statements presented to this House. Do honorable members opposite think it would affect the bonâ fide working men of the country if £1,000,000 could be sheared off the public works programme, and the amount brought down to what was actually expended last year?
– Hear, hear!
– Does the honorable member tell me that, in spite of the fact, as we were told at the Town Hall last night, 170,000 men had been drawn away from the civil occupations of the country and are being paid for out of special war expenditure, we should go on piling million upon million for the purpose of finding work for the others?
– No, I do not.
– Well, that is the position of affairs. Men are being drawn by the thousand from the ordinary and governmental avenues of employment, and, therefore, it ought to cost less to run these Departments, particularly in view of all the extra obligations that have been placed upon the country as the result of the war. Therefore, there is need that we should scrutinize these Estimates to the full, so that we may see what extravagance is being continued.
When I use the word “ extravagance,” remember always that I use it in the light of this war. All is extravagance at the present time that can be done without. Any expenditure that can be postponed is extravagance in war time.
– Give us some idea of what you want?
– The honorable member wants me to tell him what extravagance is. I tell him that the £12 a week paid for keeping him here could very well be saved.
– I amquite prepared to make the sacrifice if you are. There is a challenge for you.
– One fails to see what return there is for the money spent in that direction anyhow, other than his foolish interjections. The test of extravagance should not be what we can do with. We could do with many millions more than are being spent in the development of the country. Not- a member of this House but does not want lots of things. But during war time that should not be the test. The only one supreme test to be applied both to private finance and public finance is - What is the minimum that we can do with until we have seen this war, with all its tremendous burden of obligation, financial or otherwise, through?
– You want a clear road to scorch on.
– Exactly ; and, therefore, we need to re-adjust our point of view in relation to the finances of the Government and to the developmental work that is proceeding - all of which might be quite proper and appropriate in ordinary times. Under this heading come many of the public works that everybody agrees are necessary for the development of the country. But, first of all, had we not better decide whether the country is to be ours to develop before we spend all these extra millions upon it? It is useless our attempting to develop the country if some other power is going to get it at the end of the war.
Please God they will not. But if they are uot to do so, I venture to say that we have got to bind up our own girth and brace ourselves to the war far more seriously than we have even yet done.
– The honorable member does not like the application of that doctrine by the workman to the employer who is making huge profits.
– I regret extremely that no man can get up in this House’ and talk about anything without a lamentable party feeling being introduced. It is time it was dropped.
– I am only extending your logic.
– I protest against innuendoes of this description that meet me at every turn - that in doing what I am doing I am aiming a blow at the working man.
Several honorable members interjecting -
– I cannot understand what all the excitement is about, but I appeal to honorable members to stop this continuous interjection. Honorable members must know that if they persist only one course will be open to me, and I shall not fail to take that course if necessary. I ask honorable members on both sides of the House to discontinue interjections.
– I should like to say - and I have said it before - that, in my opinion, the man who is making inordinate and unfair profits in war time and keeping them is worse than any extravagance on behalf of the working man. There is this to be said for the working man, that, at the most, he gets nothing but a bare living, whereas the man who is extracting unfair and inordinate profits out of the war is violating the instincts of patriotism, I do not care who he may be. I have yet to learn that this Government have taken any course which is likely to interfere with such profits, though I know that some of those whom Ministers used to set up as bogies - as the representatives of the great capitalistic concerns of the country - are now entering their offices, and on coming out again expressing their profound admiration of them. Only the other day I learned from an Adelaide newspaper that certain gentlemen against whom Ministers have fulminated in and out of this House for as long as I can remember now say that Mr. Hughes is the finest man they have met.
– The honorable member is going beyond the question before the House.
– I wish to make it clear that I am here to safeguard, before all other things, the interests of the working man in connexion with Government finance and administration. It is only reasonable that we should have an opportunity to criticise the departmental Estimates. The war account with the Imperial Government could be estimated and re-adjusted later with Supplemenary Estimates. Nothing could be easier. We have been accustomed to Supplementary Estimates from the beginning. I say advisedly that the expenditure of each of the Departments should be carefully scrutinized. I believe that it is swollen, and that the administration is extravagant, having regard to the needs of the country at the present time. A War Committee has been appointed which is supposed to look into matters affecting the country’s financial position, but it has been given little to do. It is not much more than a Red Cross Committee, its efforts being confined chiefly to the mitigation of the consequences of the war. It has little to do with the prosecution of the war, and the consideration of Defence measures or general finance. The House of Commons, on the other hand, discussed the matter of financial administration very thoroughly, and, with the approval of the Treasurer, appointed a special Committee, which is now making an investigation into the ramifications of the Civil Service administration of the Empire. Nothing of the kind has been attempted here. Year in and year out our expenditure and our taxation are increasing. Honorable members opposite forget the economic truth that taxation in the long run always falls in the main upon the working man. No matter who may be hit first, the working man in the long run bears the brunt of all taxation.
With regard to the Budget speech of the Treasurer, I repeat the congratulations which I offered to him the other day on its perfect- orthodoxy. It could not have been more impeccable, or unexceptionable. Some of its statements must have made the honorable member for Bourke smile, as. for instance, the initial statement that the experience of nations has shown that the sphere of usefulness of a note issue is limited. The Treasurer is not in favour of an unrestricted issue of paper money. He told us that the general public can absorb only a certain quantity of paper money, and that there is no function for the rest except to serve as till-money for the bankers.
– The Treasurer’s conversion reminds one of that of St. Paul.
– Evidently a great light has shone on the mind of the Treasurer, and I am profoundly glad of it.
– Was the right honorable member reminded, on hearing the Treasurer’s speech, of anything he had said himself ?
– We all revise cur opinions from time to time ; it is of the essence of progress that we should. I welcome the Treasurer’s return to financial reason.
I was particularly interested to hear his whole-hearted defence of the borrowing and spending of all the Liberal Administrations that Australia has had from the beginning of responsible government. Having stated that the public debt of Australia exceeds £300,000,000, he asked in tones of challenge what particular item of State loan expenditure honorable members would have curtailed if they had had the power. He might very well have addressed his own followers in particular when making that challenge, because, if there has been one thing more than another that they have criticised in the past, it has been the borrowing of Liberal Governments. Yet the Treasurer of the present Labour Administration says, by implication, that everything has been done properly and in order, and challenges any one to say that even so much as £1 of the money borrowed was misspent, or spent extravagantly.
– The Leader of the Opposition is straining the language of the Treasurer. The purpose for which money is borrowed may be objected to without objection being taken to the borrowing itself.
– The purposes of the borrowing were specified and set out in some detail by the Treasurer, who said in effect, ‘‘I challenge any honorable member on either side to say that he would have done otherwise.”
– Does the right honorable member recollect that the honorable member for Flinders said that he would take the 25s. per capita payment from the States if they did not stop borrowing; or words to that effect?
– Have we a new financial coalition - Irvine and Higgs? Again I congratulate my honorable friend. He is on the opposite side of the table, but after his recent deliverance T think he should be over here. If ever there was a good Liberal, economic deliverance, it was his financial speech of last week. I challenge any member on this side to say that there was a sentence of it which they would have altered. The honorable gentleman told us that “ there is no large leisured class in Australia “ ; “ that the whole of the people of Australia are workers if they can get work to do.” He also mentioned “ that valuable assistance had been given by the financial institutions, the stock exchanges, and the press throughout Australia.” The financial institutions and the stock exchanges ?
– The bill brokers and the spielers.
– I do not call them spielers, nor does the Treasurer.
– Nor do I. They were not enumerated.
– I congratulate the Treasurer on his attitude during the present crisis, and on the way in which he has faced the facts of the situation.
– Is that why the fight honorable member is poking fun at him?
– I am not poking fun at him.
– Why does the right honorable member criticise him if he agrees with him?
– I am not criticising him; I am congratulating him with all my heart on the sanity and wisdom of his financial utterances.
There are some features of the Treasurer’s financial statement that I welcome as an indication of an altered attitude on the part of the Government towards the States of Australia. I welcome it on account of the whole scheme of Federation, perhaps more than for any other reason. If there be one thing more than another that has characterized the relations of the Commonwealth and States, it is the constant and unnecessary friction which has occurred between them, and which has cost this country and the taxpayers dear many a time in days now long gone by.
If tha new Prime Minister and the Treasurer strike a different note - a note of conciliation, co-operation, and harmony - then I think that we ought to welcome it, no matter on what side of the House we sit, since it means a way to efficiency, prosperity, and economy.
– The right honorable member Would not cast the whole of the blame on the Federal Governments ?
– I do not; but for some years the attitude of the party now in power has been that of keeping the States a little too much at arms’ length. If there had been more cooperation, many a time friction would have been obviated, and the consequent waste, financially and otherwise, would have been avoided. Let us remember always that the Federal Constitution is showing itself in these troubled days more than ever to be a flexible instrument of government, capable of meeting every crisis that may arise in our national existence. Where, for instance, could we have a greater triumph of the Federal principle than we have in the financial arrangement that has just been made in regard to the Murray waters? Almost from time immemorial the States have been in keen conflict over the question of navigating the rivers of Australia, and all the while the provision for navigation has been embedded in our own Constitution. This is only one instance indicating the financial friction that has obtained between the States and the Commonwealth to the great disadvantage of the whole.
Altogether, on the financial side in particular, the Commonwealth Constitution, which Mr. Fisher so often declared to be the worst in the world, has shown itself to be a really flexible instrument of Government, capable of meeting the needs even of these times. I welcome the statement of the Treasurer that he is for harmony between the States and the Commonwealth. It was, perhaps, one of the most notable statements he made.
– You can always be in harmony with the other fellow if you give him all you have.
– Quite so; but my impression is that you can be in harmony with him if you seek the point of justice. In all these controversial matters there is a point of justice. My long experience in adjusting differences is that if you seek earnestly for this point of justice - meeting round a table, and in an amicable way, each looking at the other’s point of view - you are likely to secure a proper adjustment rather than by keeping each other at arms’ length. That has been demonstrated many a time, I think, in the honorable member’s own experience.
– Hear, hear !
– The Treasurer’s statement relating to the note issue is also to be welcomed. I hope the honorable gentleman has made up his mind that the extension of the note issue cannot safely go very much further. It amounts at present to £45,000,000, and the Treasurer’s declaration that he would not interfere with the statutory gold backing - nay, that he would provide during the war time a reasonable margin, in addition - is very welcome to the House. The matter is one that is beginning to cause concern in many financial circles other than our own. It cannot be too strongly emphasized, as the Treasurer has admitted - and I congratulate him again on the admission, which was” one that we could never obtain from his predecessor in office- that the issue of Australian notes is simply a scheme of deferred borrowing. The honorable gentleman himself admits that the redemption of these notes must come at the end of the war - that the public need at the most only £10,000,000 of them, and that the remaining £35,000,000 will require to be redeemed when the war is over. He should have added to his statement that the public debt of Australia-
– I said that must be remembered.
– Quite so.
– Is it not remarkable that the financial institutions themselves make no objection ?
– No; I rather think it is one of the things on which the Treasurer rightly congratulated them. The honorable gentleman will not say that the financial institutions would rather have their vaults stuffed with notes instead of being filled with gold. Notwithstanding his theories, the honorable member himself would not prefer anything of the kind.
– The notes have the credit of the country behind them.
– But even with the credit of the country behind them, notes are not as good as gold. That is the point.
– Then the right honorable member has very little faith in his own country.
– Stinking fish !
– In this connexion, may I quote another financial authority 1 Mr. Lloyd George, discussing this very matter in the House of Commons the other day - and I commend this to my honorable friends opposite, because it particularly and vitally affects them just now - said that any attempt to water the currency must express itself in the higher cost of goods. Gold, therefore, is better than notes, notwithstanding that the credit of the country is behind them; for, when the gold is there, prices do not appreciate. If prices appreciate when notes are substituted for gold, then, by so much as they appreciate, the notes must be worse than gold. Mr. Lloyd George went on to say -
It is an easy and very tempting method to inflate the paper currency of the country. You appear to get over your difficulties in the simplest way, and it is very difficult for any one to point out the way you are going wrong for some time. Looking at it most carefully it is simply an indirect method of levying taxes upon the income of the people. You water the currency and the prices go up.
The honorable member for East Sydney, who interjected “Stinking fish!” just now, will say, perhaps, that Mr. ‘ Lloyd George was crying “ Stinking fish ! “ when addressing himself in this way to the great financial problem of the Empire. It is a note of caution that cannot be too often sounded in our ears that, while the note currency of the country may tide us over our difficulties, its redemption must always be kept steadily in view. While the notes are operative, no matter whether they are in the coffers of the banks or in general circulation, they all mean, in the last resort, an increase in the price of goods, and are, therefore, a detriment, more particularly to the working people.
– It is better to have notes and dear food than no notes and no food.
– Certainly .
– In every other country during this war time - even in America - the note issue has been considerably expanded.
– I am aware of that. I know, also, that every nation that is expanding its note issue is paying dearly for it. Germany is the most notorious example of all. True, the gold in her coffers is still practically what it was at the beginning of the war. While it is a little less, the reduction is not material ; but she has flooded the country with paper money. The destruction of her commerce on the high seas having taken place, she is no longer, however, under obligations to finance her oversea commerce, and in that respect she has an advantage over Great Britain. While we purchase hundreds of millions of pounds’ worth of goods abroad, we have to finance all these exchanges on a gold basis, and this is giving rise just now to a very serious problem in the Mother Country. The material resources of Great Britain do not suffer, but, temporarily, there is the greatest possible trouble in the matter of this financing. This was seen the other day when, in order to finance their total obligations in America, amounting to £300,000,000 or £400.000,000, they could float a loan of only £100,000,000, and they had to provide collateral security, and to pay for it an amount aggregating, I think, about 5 per cent. This illustrates the difficulties associated with financing our foreign trade. Germany’s foreign trade has been destroyed, and this has had the effect of relieving its finances internally. While Germany is issuing paper money, it proceeds to fix the price of everything in the country, and so maintains the parity of the paper money within the country while the war lasts. But there is a terrible time coming for Germany when the war is over, and T cannot see that there can be anything but financial collapse for that country. It is not interfering seriously with the conduct of the war, because her finances have been relieved by the destruction of her commerce on the high seas, and the necessity for financing it on a gold basis has been obviated.
– Did not gold depreciate in value in America?
– I have not heard that it depreciated. I only know that America is making immense profits out of this war. She is doing better out of it than any other nation, but that is a point, which I do not wish to stress. I welcome the Treasurer’s declaration that he recognises the danger of financing by means of paper money, and that every care will he taken to keep the issue within a moderate and reasonable volume until thu war is over. I welcome particularly his declaration that at the end of the war these notes must be redeemed, and redeemed at the earliest possible moment. All notes issued over and above the immediate requirements of the circulation of the country are so much deferred borrowing on the part of the Government.
Mr. Fisher was always telling us that.he was financing all the requirements of the Commonwealth without borrowing. His successor in office as Treasurer has frankly told us, however, that the note issue is simply a system of deferred borrowing,
And it means borrowing just as much as if he put a loan on the market to-morrow. He relieves himself in this way of payment of a little interest, but, as to the capital, the redemption of these notes must take place at the conclusion of the war. It will be seen that the public debt of the Commonwealth is as follows : - Total debts, as stated by the Treasurer, £57,802,861; money yet to be raised for war purposes, £24,000,000; total, £81,802,861. Adding to that amount the £30,000,000 worth of notes to be redeemed when the war is over, and, therefore, only deferred, but to which the Commonwealth is committed, we arrive at a total Commonwealth debt of £111.802,861.
– That mode of reckoning would reduce the interest bill considerably.
– Yes, but it does not reduce the capital. I am speaking of the total loan obligations. I should say, however, that we must deduct the £18,000,000 lent to the States, leaving the net indebtedness of the Commonwealth, deferred and actual, at an amount of £93,802,861. If we now add the towering State debts of £355,000,000, which seem to be ever taking their course upwards regardless of the war, and of which there seems no curtailment or cessation, the total public indebtedness of Australia at the present time works out at about £448,80,2,861. *
– The honorable member would not say that a war debt is the same as a State public debt incurred for the building of railways and other works?
– I am not analyzing the debt, but I am pointing out that it is a debt to be paid at some time or other. There are assets backing the whole of the sum borrowed by the States, and the Treasurer has challenged us to point to one sixpence of that money which ought not to have been borrowed. He has given for ever the answer to all the statements we have heard from the Government, and the party they represent, inside and outside of Parliament, as to the borrowings by Liberal Governments in past times. According to the Treasurer, every shilling of those loans is justified. I welcome a statement of that kind, because I think it is of use to the country.
– Probably by now the Treasurer is sorry he made it.
– I do not think so. I give the Treasurer credit for saying what was in his mind; he is candid.
I prepared those figures relating to our indebtedness in order to indicate the need that exists for caution and scrutiny regarding the financial operations of both State and Federal Governments at this time. In recent years there has been an alarming increase in the borrowings of Australia, apart altogether from loans for war purposes. In the State of New South Wales we’ have the shocking example of an increase of £37,000,000 in the public debt during the last four years for the purposes of State development alone. I wish I could be sure that the whole of that money has been spent according to strictly commercial principles, and all I am contending for now is that for every pound we spend, particularly in these strenuous war days, we should see that we get full value. That is one of the principles laid down so admirably by the Treasurer in his statement. I think our taxation has pretty well reached the end of its tether for some time to come.
– Oh, no; there are lots of sources yet. =
– When we have two land axes, two income taxes, two probate taxes, super taxes to boot, absentee taxes on the top of them, increased charges of all kinds, and a high Customs revenue, we have gone to nearly the full length of our resources. We could go further, I admit. I am not suggesting that our taxation resources have been exhausted, but I do say that we have pone as far as we ought to go for a long time The other day I read in the Nineteenth
Century a statement on British finance, by Edgar Crammond, one of the best financial writers in the Old Country, and he gave the Imperial taxation at £3 5s. per head. The Prime Minister, whAn introducing the Income Tax Bill recently, grouped all taxes in the Old Country, municipal and all other imposts, and endeavoured to show that the total was very high indeed. I think he made the total between £5 10s. and £5 15s. per head; but Mr. Crammond shows that £3 5s. per head is the total amount of the taxation of the Old Country at the present time. In Australia, we are far beyond that amount; and I say that I do not think this double taxation can go much further in the ratio in which it is proceeding. It is not as if relief were being afforded in other directions. I could understand some of this taxation being in substitution of some other form of impost which was being remitted, but there is no proposition of that kind. The Commonwealth still collects £3 per head through the Customs, in addition to the high taxation which is piling up continuously until the people are beginning to wonder where it is all going to end. All the States are spending more, and the trouble is that the per capita cost of governing Australia is increasing at an alarming rate. I find that, in the year 1909-10, the total expenditure of the States and the Commonwealth was £55,561,372, equal to about £13 6s. per head. The total expenditure last year was £91,689,625, an increase from £13 6s. per head to £18 10s. per head, or 40 per cent. Most of that increase relates itself to the cost of government. An increase in expenditure of 40 per cent, in six years should give us all pause. It is time for a scrutiny of all expenditure; it is time for economy, and for shearing down instead of multiplying our out-goings as we are doing from time to time. I understand that when storms arise” at sea ships shorten sail, and steamers heave to until there is calm weather. Financial storms are blowing* over us in Australia, but our ship of State takes in no sail ; our steamer continues to go full steam ahead in the face of the gale..
The application of all these facts, from my point of view, is simply that increased taxation and extravagant government must inevitably express itself in the higher cost of living, and that is where the problem comes home to the working man. They mean, also, impoverished and inefficient industries. In the form of loan money, we are drawing from the working capital of the Commonwealth, and that is a serious step to ta ke in any country, more particularly in a young and undeveloped one. As to our capacity to bear the burden, I hope I shall not be understood to be casting any doubt. With the Treasurer, I believe that our capacity is equal to any burden in prospect, and the more we investigate the figures the more we find ourselves able to stand the strain. But remember, always, that we use this money in war time at the cost of the development of the country in the final resort, and also at the cost of the working man, because to him it expresses itself in the higher cost of living. I thought it well to call the attention of the House to these facts, and to stress the need for economy. That is the outstanding requirement of the moment. The great imperatives are, and will continue to be until the war is over, more men and money. We must continue borrowing from our working capital, and our surplus. There is no other source of money in Australia. As the Treasurer has said, there is no large leisured class in the Commonwealth, and there are no large vested funds of wealth on which to draw. All the money for the prosecution of the war must be drawn from the working capital or from savings, which, in a new country, ought always to be utilized in development. In this country, as in every other country, more particularly every young country, we are living from day to day, and from month to month, and there are limits to even the idea of taxing the wealth of the community. Mr. Mallock, in discussing, in the Nineteenth Century, recently, the limits of super taxation even in Great Britain, showed that if the aggregate of all incomes in Great Britain over £700 . a year were applied to war purposes they would cover the expenditure on the war for only four months. If those incomes were taxed at 10s. in the £1, it would cover the war expenditure for two months, and if taxed at 7s. in the £1, for six weeks and a half. It will be see»> therefore, that to prosecute the war at Home, although wealth may be taxed, it is still necessary to draw on the ordinary income of the country, and extract a great sum from the working capital and the enterprise of the people. Here we are taxed up to 5s. in the £1, and from that taxation on wealth we get only £3,000,000. I direct attention to this, because it is often said that we ought to conscript the wealth of the country for the purpose of carrying on the war. We are conscripting the wealth to the extent of 5s. in the £1 ; and yet that only gives us an income of £3,000,000 with which to meet our obligations arising out of the war.
I am afraid that we are carrying on this war with a light heart, even “yet, in Australia, particularly from a financial point of view. Earnest minds in other parts of the world, and particularly in Great Britain, are devoting themselves to the consideration of the finances as these will present themselves, and as they are related to the aftermath of the war. One writer has pointed out that we should aim at an ideal which will give us, when we have beaten the German, still a million men with which to reap the results of the war. If we bleed ourselves white in the matter of finance, and bleed ourselves to death in the matter of manhood, the fruits of victory may slip from us even when we have won the war. We saw this in the case of Bulgaria, which, when it had beaten the Turk, was so exhausted that the fruits of the victory were taken away. Therefore, this writer points out that we ought to have a million men left, or we shall not be able to avail ourselves of the full advantages of victory. The same may be said in regard to our finances. London is the financial centre of the world, but if London is bled white in the effort to prosecute the war, there is danger of the financial supremacy passing to America, or some other neutral country whose financial resources are intact. Clearly, therefore, the more vigour we can put into the prosecution of the war, the more money we shall save in the end and the better position we shall’be in to reap the results of victory after winning it fairly in the field.
I shall not trouble the House further with regard to these matters, which I regard as of first importance, and to which I refer in order to stress the need of both private and public economy. We ought to get it firmly fixed in our mind that the more we can save in our ordinary outgoings the better we shall be conserving the financial interests of the Empire at large. We should, therefore, stop all waste, both private and public - private waste in the shape of luxuries and comforts, holidays, sports, household expenses, and superfluities - and, if there ought to be that curtailment in the case of the individual, there is an equal obligation on the part of the Government to stop all waste and to observe national thrift.
Mr.Fenton. - The honorable member does not mean that if a man has money to build a house he ought not to build it now ?
– I do mean even that kind of economy. A man could serve his country better by investing his money in a war loan than in building a house.
– We must keep people employed.
– We are keeping people employed ; and there ought to be sufficient employment, with 170,000 withdrawn from our ordinary industrial occupations. Under such circumstances, there ought to be no unemployed problem in Australia, and I do -not believe there is any serious problem of the kind at the present time. With the harvest coming on, there ought, indeed, to be a shortage of men instead of a surplus. Why, therefore, should we be so squeamis”h about a little money, which otherwise would go in this, that, or the other operation, as for instance, in building a house ? Let us build all the houses we can; but let us take care that the money is not needed for war purposes before we do. If I have shown the need of economy, I shall have done what I set out to do. I emphasize the fact first, last, and always, that what we need to-day in our Commonwealth and State finances is economy, thrift, enterprise, increased production - anything that will add to our material resources, and assist in bringing the war to a speedy and successful end.
.- I have to congratulate the honorable member for Capricornia on his appointment as Treasurer, and also on the financial statement he has submitted to the House. That statement has been amply dealt with by the Leader of the Opposition, and, therefore, I do not propose to weary honorable members by any remarks of mine. I wish, however, to bring under the notice of the House a question that I think can be more properly dealt with under this Bill than under any other. I refer now to the desertions of men from the Langwarrin Camp.
– I must ask the honorable member not to go into details of Defence administration.
– As. a matter of. fact, 1 had: intended to- go: into details; and while, of: course, I shall obey your ruling., sir,. I think the subject could be more properly dealt with on the second reading than; in Committee. There- is no doubt that this is> a. matter in. connexion! with which some, of the money proposed to be raised by this Bill will be spent-
– If I permit the honorable, member to proceed as he suggests, I shall open a7 debate on any or every little matter that might arise in the Defence) Department. The honorable member may refer to the subject in a general way; but. if he- is permitted, to- go into details-, we shall get away from the Loan Bill altogether.
– I had intended to move the- adjournment of- the House to-day, hadi I. been here, im order to refer to. thos matter int detail; but,, under the circuntstamces, I shalii allow ifr to> stand, over. In a. genera1! way, however, I may say that the Defence- Department- undertook to harae- these men brought back into, camp almost immediately after their- desertion. Steps were. taken the moment it was heard they had escaped;- and, before one1 train reached Melbourne, a number of them were arrested at Caulfield. Prom then until now, in spite of threats: of publication, of their names - and it: is- nearly three weeks agoi - the’ bulk of the men are still at large-. L skalll say nothing further now, except; to impress; on the Treasurer and the Government: that the House, ought: to bec more- liberally supplied with’ information’, concerning- the administration of the Defence1 Dep’aEtmenit, so that helpful criticism might be forthcoming at a. time like this, when every man is- anxious to assist. At the; time this: occurred! at Langwarrin,, a suggestion, of mine would.,, 1 think, have proved effective in securing the return of the men.. Instructions ought to have been given to every Camp Commandant to> recall all the men on leave, because, had) this been done,, the civil and military, police could have been directed to arrest any one* found at large in uniform).
– But the men might have got out of their uniforms.
– I am- satisfied! that if such a. suggestion had beeni acted, upon the great bulk of the men would havebeen returned in twenty-four hours. I trust that the Treasurer will, convey what I have said to the Minister’ of Defence-
.- I also wish to offer my congratulations- to the honorable member for Capricornia on his accession to office, and also on the able report he has placed before the House. The honorable gentleman,, in the course of his remarks, said that we in Australia are floating, our loans at par,, and that if 20,000,000 of a British population, could carry a. national debt of £900,000,000 in. 1816, our Australian population, of about 5,000,000 should be able to raise and carry a. national war. debt, of a fourth of that amount. . The honorable gentleman evidently expects that Australia will be able to go on borowing and raisin? loans to an amount of £225,0.00,000, but he does not point out. to the House that Australia is already indebted to the extent of £350.,000,000Hnder the circumstances, his argument does- not come with any great- force-. However, what I am most anxious about is the manner in which the Government is spending- money. When we find that their- expenditure, over and above- their revenue, is something’ like £3,500, 000: - ordinary peace* expenditure’ - it is high time to call a- halt. We are tolif that we require men, money; and munitions, and that we- ought to- keep intact all- reserves for the purpose of raising money for the prosecution of the war. In answer to the honorable nj»mber for Maribyrnong, the Leader of the Opposition said that, in his opinion, money would be better invested in a war loan than in buiTdi-nsr a house, and I say that the men who would otherwise be employed’ on that house would be better employed in the prosecution of the war. Instead of these men being- engaged in building houses- the industries of the country should have been mobilized for the purpose of successfully prosecuting th© war, and they ought to have been employed in the manufacture of munitions. In this respect we are a long way behind1 other countries. Canada, a country similar to our own, has manufactured munitions to the extent of £50,000,000, Africa has done the. same to the extent of £8,000,000.
– South. Africa?
– Where did the honorable member get his figures from?;
– The statement was made, in a leading Sydney newspaper-; and I think the: figures caxu be substantiated. In-, the Sydney Mornimg Herald. of last Saturday, in an article onthe Japanese Budget,Dr. Bryantpointed out that the Japanese finances last year showed a deficit of 10,000,000 yen. This was being metby the postponement of public works and the acceptance of contracts for themanufacture of munitions. So far, the article stated, contracts have been accepted to the extent of 100,000,000 yen. Japan realized thatshe must cut down her public works expenditure and go in fox the manufacture of goods mostly in demand.No factory in the Commonwealth could be better employed at the presenttime than in the manufacture of munitions, because no item of manufacture will produce a bigger revenue.If we could manufacture munitions onabig scale,there would be a steady flow of gold into the land, and with this we coulddischarge all our obligationsoverseas. In hertraderelationships with America, thebalance is now against Great Britain,because of the demand for munitions from America;and if we could follow in the footsteps of Canada andSouth Africa, we should be helping forward the cause of the Empire better than in any other way. Quiterecently the Government introduced -a proposal tospend £800,000on new works. In my view, these works should be suspended. It is all very well for honorable members to say we must findemployment; but, as the honorable member for Parramatta pointed out, 170,000 of our manhood have already been withdrawn from the various avenuesof industry. The labour market has, therefore, been relieved to that extent, and, under these conditions, I think we ought to slacken off our public works. What particular advantage is it to this country, for instance, to continue that railway in the Northern Territory?
– Order! The honorable member must notanticipate the discussion of a motion that is on the business paper.
– It is proposed to lay down another cruiser at Cockatoo Island ; but thatboat will not beready for years after the war is forgotten, and the men engaged on its construction would be much better employed making munitions.
– Does not the honorable member thinkitwouldbe good policy to build a dozen submarines?
– I should say so. But, judging by theexperience of theBrisbane, the constructionof a new vessel - I think it is to be namedthe Adelaide - is the last thing that we desire at the present juncture, as it will be of no assistance in theprosecution of the war. The other day 3,500 railway men in Sydney offered to theGovernment their services for use in the manufacture of munitions. Their offer was turned down because as the then Prime Minister, Mr. Fisher, said, he could not accept it as it would interfere with the labour market. Some months ago 12,000 men in London made a similar offer. Their services were gladly accepted. These people are now hardat work helping thecause of the Empire, but in Sydneythe unions would not letthe men work. We mustbe earnest aboutthis matter. Every hour wasted is an hour given to the Germans ; every bushel of wheat lost through lack of labour in the country districts is a bushelof wheat given to the Germans; the labour of every thousand men who go onstrike is so much labourgiven to the Germans. We must look this matter earnestly in the face, droppingall our differences, and makea unanimous effort to successfully prosecute the great undertaking to which we are committed.
.- I am not going to allow this opportunity to pass without, to some extent, repeating what I said a little while ago regarding the Government’s attitude towards the supply of armaments. In this respect, we are not doing at all what we could. I hope some of the money we are now voting will be spent in expediting the output of arms and ammunition, that are required even morethan men at the front. Hitherto this Government, by its lethargy and its absolute subservience to the officials, who, rather than be told what they ought to do, will persist in doing the wrong thing——
– This Government have been in existence only about three weeks.
– I am just coming to that point. It is because we have a new Government, or a Government newin parts - the old Government re-patched - that I wish to impress upon it the feeling of the country, so far as I have been able to gather it, as to what the Government ought to be doing. Sending men to the front is not sufficient; we all know that, and it is high time the country was regimented to a greater extent than it has been for meeting the demands of the war and the employment of men on work for which they are best fitted. The other day the Minister of Defence issued a pious edict intimating that private firms would be required, as far as their plants were capable of turning out munitions, to give first place to that trade. This sounds very well, but what are the Government doing to back it up? By its own folly, by its own innate lack of initiative, the Government have, to my own knowledge, deliberately left idle for two years works that could have materially assisted our output. I have hammered at the subject time and time again without anything having been done. To-day, I admit, a Commission has been appointed to settle a dispute that should have been settled two years ago. The output lost as the result of this would have placed us in a much better position than we are for fighting the battles of the Empire. In regard to the Small Arms Factory, the acme of folly was reached some time ago by an entirely premature announcement about shifting it, and that has done more to retard the output of arms than anything else. That action still stands to the discredit of the Government, and some definite pronouncement is yet required in order that the position may be cleared up. The town of Lithgow is now in a state of congestion, and the public health is being affected as a result of that condition, because people are not prepared to accommodate the extra hands engaged at the Factory until they know what is in contemplation. The Factory ought to be working three shifts, not two. It is idle for the Minister to say that it is impossible. Here, again, he is under the control of his superior officers - I use the words advisedly - who will brook no interference, and, because they are military men, seem to think that they know everything from A to Z in business matters. Only the other day, I had to communicate with a military officer in regard to something which I thought was under his control, but was not, and he told me that he was disgusted with the position of affairs. “ I have spent my lifetime,” he said, “ in qualifying to train men to fight as soldiers, and I have now got to look after a camp, to see that men arc fed and washed, and to do work that any business man could do, but for which I am not fitted. My talent is therefore being wasted.” Those in authority will not brook interference. The Small Arms Factory should be working three shifts a day ; but there is not at Lithgow accommodation for an extra shift, because the townspeople have lost heart. They cannot be expected to speculate in house property when a change such as has been announced by the Government is hanging over their heads. The value of their property has been decreased by the announcement of the Government that the Factory will oe removed to Canberra. It behoves Ministers to repair the injustice that has been done, which has not only injured the citizens of Lithgow, but has also materially interfered with the output of munitions of war at the Factory. The Government should let it be known definitely that it is not going to remove the Factory from Lithgow. When that has’ been done, the townspeople will resume their wholehearted attitude towards the assistance of operations, and will facilitate the’ accommodation of those who are to be employed there. There is no valid reason why three shifts should not be worked at the Factory, and why temporary accommodation should not be found there for the extra machinery that has been ordered; though I doubt that that machinery will arrive in time to be of use during the war. When it does arrive, however, it should be installed immediately, wherever it can be used to the greatest advantage, and all machinery for the manufacture of small arms should be under the same roof and the same management. I urge the new members of the Ministry to display their business acumen by getting the best results possible in this time of stress from the machinery and resources available, and not to waste time in building castles in the air, and in speculating as to the future construction of a paradise which, if we do not get busy in other directions, we shall never inhabit.
.- I think it is a great shame that Australia is sending to the front lads of only eighteen years of age. The matter has already been mentioned in this Chamber, and drastic action should be taken. No one should be allowed to enlist who is not at least twenty, or will be over twenty on leaving our shores.
– The honorable member’s son was not twenty when he left.
– No. When a lad is eighteen years of age, and says, “ Father, I want to join the Forces; others of my age are joining,” what can his parent reply?
– Lads would go to other States, and represent themselves to be twenty-one years of age if they could not enlist at eighteen.
– Lads who are under eighteen are representing themselves to be over eighteen.
– We cannot prevent those things. My complaint is that the Government asks for men of eighteen.
– That is the British age, and Australians develop earlier than Britishers.
– A short time ago I was chairman of a meeting which was addressed by a young fellow who had returned wounded from Gallipoli. He devoted two hours to an interesting account of his experiences, in which he spoke highly of his officers, and said that the doctors and nurses were doing magnificent work, and found little or no fault with anything. As to the serving out of equipment on the return voyage to Australia, his statement was that so far as the Ballarat - the vessel on which he returned - was concerned, everything was in firstclass order. But, he said, “ There is one thing I should like to emphasize. I do not know whether I should mention the matter, because I am still in uniform : but, in my opinion, many of the fellows who go are too young.” Subsequently, in conversation, having asked him to dinner, I learned that there were many things which he could not say publicly, and he told me that a great reason why boys should not be taken was that the corruption and iniquity at Cairo were so great that they ought not to be allowed to face the temptations awaiting them there. In my opinion, at eighteen a boy is not sufficiently developed physically to make a good soldier. The honorable member for Balaclava savs that boys enlist in the British Army at eighteen years of age; but, generally speaking, a recruit of that age undergoes some years of training before being sent into the field.
– Usually men of eighteen are not sent to the front, and get at least two years’ training at Home.
– Yes. In any case, they move slowly in Great Britain. I understand that the list of contraband goods published by the British Government at the beginning of this war is the same as was published during the Napoleonic wars, and eighteen may have been fixed “as the age for enlistment many years ago. In any case, lads of that age who join the British Army usually receive some years of training before being sent to the front. The honorable member for Flinders has stated that at eighteen a lad is too young to serve in the field, and I agree with him. We should have some definite statement from the Government on this subject. It is a shame that young fellows under twenty-one years of age should be sent away when there are many considerably under forty-five years of age who stay at home.
Sitting suspended from 6.30 to 7.45 p.m.
– This question of the age of enlistment has been raised once or twice by honorable members, but the Government are still calling upon young men of eighteen years and upwards to volunteer. I should be glad if the Treasurer would give us the views of the Government on the subject. If they are determined to allow lads of eighteen to enlist I do not know that we can do more than we have in the matter. Another question to which I wish to direct attention is that of the delivery of letters in Egypt. The delivery is not yet by any means satisfactory. Among others deputed to visit Egypt and report on the subject of mails was Mr. Keith Murdoch, an Australian journalist who was proceeding to London, and I should like to know whether a report from him has been received. The question is of great importance, especially to our men in Egypt. A friend of mine who occupies a high position in one of the battalions at the front, wrote to me as follows regarding the position in Egypt -
The mail arrangements are awful. A man came from Melbourne, but never inquired around the battalions - the real sufferers. A chaplain yesterday received an urgent cable dated June -
This letter was written on 27th August, so that the urgent cable, dated June, did not reach the chaplain in question until the 26th August. The writer continues. -
I had a cable lying in an office seven days, and it was casually picked up amidst a bundle of letters. It is not the fault of the Eastern
Extension Company ‘or of the Egyptian Post Office. I only wish I had the job for a month. Letters are more important than anything else here- -even than food or rest. ‘To see the fellows -on mail day would gladden the eyes of the senders. It brings back thoughts of home. There are many cases where men, . after spending . some time in Egypt, have left for the -front without receiving -even -one letter from home. This is very hard, not only ‘on the soldiers at the front, . but on their fr-iends in Australia.. A wounded soldier who recently returned from Egypt told some of my friends that -a leading officer in a battalion to which he belonged had not received one letter from Australia. This officer one day asked him whether he had. received -a letter by a certain mail, and on being tald that he had, wept almost like a child, saying, “ I have not received a letter since I left home. I am forgotten.” As a matter of fact, his wife and children have been writing to him regularly, but none of their letters have been delivered. The wounded soldier to whom I have referred, and who took part in the landing at Gallipoli, said that since returning home he had learned that fifty or sixty letters were sent to him, although not one had reached him. He also mentioned that on one occasion he saw twenty-seven or eighty-seven bags - he gave me the exact number, but I forget for the moment whether it was twenty-seven or eighty-seven - of mails from Australia lying unsorted. The men offered to sort them, but were not allowed to do so, and there they remained. I wonder that . young Australians do not seize the mail ba,gs in such circumstances and sort them . for themselves. We should have from the Government some statement as to what is being done in this matter as the result of ‘the reports that have heen furnished. I take it that Mr. Murdoch and others have reported on the question, and the Treasurer, I am sure, will agree with me that it is very haird on those concerned that letters to ‘soldiers at ‘the front should not be delivered. I know that in some instances the fault does not rest with any Department. In one case ouite a number of mail bags were -lost from a ship, but it seems strange that some men . should be in Egypt for months without receiving a letter from Australia, although many have ‘been addressed to them.
– What about the honorable member’s own experience?
– I am very glad to say that my boy wrote ‘to me just ‘before he was leaving Egypt for the front, to the effect that hehad received -all ray letters. The mother of . a young man from Broken Hill who went to the front wrote to me recently that she had received a -letter from her son saying that he had had no word from home, although she and her daughters had been writing regularly to him. Something ought to be done to bring about an improvement. If we find that the fault rests with the Imperial officers, I think that in placing our troops under the direction of Imperial officers we have a perfect right to say that we desire that Commonwealth officials -sh-aiH attend! to the ‘delivery . of the mails. The only other subject to which I desire to allude is that of war pensions. Will the Treasurer state whether the mother of a private who is killed on active service is entitled to the -full war pension of £1 per week if she is in receipt of an old-age pension, or whether the war pension would, in such -circumstances, ‘be reduced to 10s. ?
– That is the way the war pensions are ‘being ‘administered.
– I would remind tha honorable member that the question before the Chair is the second reading of the War Loan Bill.
– I take . it that some of the money proposed to ‘be -raised under this Bill will be devoted to the payment of war pensions, and, if so, we should be at liberty to discuss that . question. I do not wish to press the point, hut I should be glad to be informed whether a woman, in the circumstances I have named, would! receive the full pension of £1 per week on the death of a son on whom she was dependent, although she was drawing am old-age pension of 10s. per week.
Question resolved in the affirmative.
Bill read a ‘second time, and reported without amendment; report adopted.
Motion (by Mr.. Higgs) proposed -
This this Bill benowread a thirdtime.
– I read the statement of the Treasurer with interest; but I find that it was, to a . large extent, a repetition of the statement delivered on the -12th . August by the ex-Treasurer. That statement I fully criticised at the time, and it would serve no good purpose to repeat my observations to night. I can only say -that members of the Opposition desire to give the new Treasurer every assistance to pass this measure,, because we know that it is necessary.* in order to enable the Commonwealth toi assist the Mother Counttry in prosecuting the war to a successful’ issue. I notice that the- revenue estimated by the present Treasurer is the same as the estimate given by the exTreasurer, Mr. Fisher, except that the receipts from income tax are expected to be £3,000,000 instead of £4,000,000. As far as I can. judge from the figures, the- revenue for the current year is estimated to be about £4,000,000 more than for the- previous year. I regret to have too say again- to the Treasurer that a great deal of confusion, arises, and will continue to arise, and honorable members will, be very much inconvenienced, owing to the fact that the revenue and expenditure for the. war are mixed’, up with the” ordinary revenue and expenditure on current account. This grouping of the two classes of expenditure? may be more convenient for the Treasury, but it: is hot. so convenient for* honorable1 members, or the- public. In all the States* loan expenditure, is; kept- separate from ordinary expenditure,, and Parliament is. able to> understand clearly the financial operations- of the> country;- but it is not easy to distinguish loan- expenditure from- ordinary expenditure under- the system- of bookkeeping at present in operation in the Commonwealth. I am surprised at the Treasury officials- combining the expenditure in this way; because when I was in. office I was determined that it- should not be done. There is nothing to indicate what is meant by the item “ Treasury-bills in aid of revenue, £311,905.” . Does this represent a deficit from last year ?’ If it does, why not «ay so?’ The absence of any explanation of the item only causes confusion. In regard to new works,. I notice that an expenditure of £3,627,629 is estimated, as against an actual. “ expenditure of £2.^670,236 last year. I do think that, in this time of danger and difficulty, when money is so. much required, we ought to try to. live within, the same amount as was expended! last year>, whea the disbursements were the- greatest in the history of the Commonwealth. I am not saying a- word’ against the present Treasurer, because- he has not yet had an opportunity of grasping the- financial requirements of the country; but I do hope that he will thoroughly investigate- all exr penditure. He’ has> the power to curtail disbursements, because all Departments are subject to-the Treasurer - they cannot operate without money - and if he keeps a strong- hand on the expenditure- he will be. rendering– good service.
– Does that remark apply to- the Kalgoorlie-Port Augusta railway?
– Surely the honorable member does not think that I wish him to waste money anywhere. My desire is that he shall exercise economy wherever it is possible. I’ notice that one of the principal, items of increase in the Estimates of expenditure for the current year is “ Naval, and Military Ordinary Services, £1,186,000.” That, expenditure is in no way connected with the war. One would expect that this year expenditure on ordinary Defence services would be less than last year.,, ber cause, many items would be charged to loan, which in past years were charged to revenue.. Of course, the special war expenditure cannot be avoided. We can only hope that care and economy will, be practised . Another increase, is- ‘ ‘ Military Stores, including field guns, small arms0 ammunition, &c, £310,000.” That, expenditure may be justified. With, ifr gard to items of. increased expenditure like. “ Postmaster-General’s Department, salaries and contingencies, £367,000; conveyance of mails, £125000; lighthouses, £10’4,000”; lighthouse steamers, new lighthouses, &c.., £72,000; Navigation, £80000;. Public Works staff, £3.2,000; and railway, working expenses (transcontinental; railway., Port Augusta to. Kalgoorlie), £45, 000,” there seems to have been no attempt to keep the expenditure this year within the limits of the previous year. That is very regrettable. The expenditure, on the war is estimated by the present Treasurer, as it was by his predecessor, to be about £46,000,000’. When discussing this matter in August last, I urged that there should be better control of the war expenditure. I said then, that I did not think the military and, naval officers could be reasonably expected to exercise a proper supervision of that immense expenditure. Of course, I have no id°a of imrjai’ring efficiency, but care and economy- do not necessarily lead that result. I’ say, again, that some specially qualified persons ought to be intrusted with the control of the expenditure of such a vast amount as £46,000,000-.
It must be remembered that, in addition to the trials of the war, the Commonwealth has passed through a terrible drought. It is necessary that we should make an effort to live within our means. We intend to pay our debts, and at this period we ought not to spend on current account more than we receive. We are not likely to cavil at the Treasurer’s personal views regarding the Note Fund and the note issue, even if we do not agree with the high-sounding phrases which he gave to the House. I very much regret that the House was not asked to pass the Estimates. Members on this side told the Government in August that the statement then made to the House by the Treasurer represented the best Estimate that could then be given, and that it would be better to accept them, even if they were a little imperfect, rather than wait till the end of the financial year, when the more complete Estimates will be passed in such a hurry that no member will have an opportunity of dealing with them. I conclude my few observations by expressing the hope that the Treasurer will have a very successful year.
.- I desire to refer briefly to a matter of some interest in connexion with the administration of the Defence Department. This is a case which, I think, will secure the consideration of honorable members on both sides, because it affects that political liberty of conscience which is supported by all of us. There was until quite recently a position in both Victoria and New South Wales known as that of Brigade Bandmaster. In New South Wales this officer was not merely the bandmaster of a brigade, but he looked after all the military bands, buglers, and all musical arrangements throughout the State. This man, Captain Bentley, was paid for his services £50 per annum; in other words, he was a militia officer.. He had to find all his travelling expenses, with the exception of his railway fares. At the time he was appointed there were ten bands in New South Wales, whereas now there are twenty-four, with ten others forming. He was a member of the State Professional Musicians Union, of which Mr. A. O’Brien is secretary. I think, though I speak without absolute knowledge, that that union came before the Court in connexion with some of its rules. However, this man Bentley committed the crime of trying to form another union, and also the crime of using his name and rank in connexion with a band which he used to tender the agricultural show and other shows. Immediately after he had held the inaugural meeting of the new union, which was duly registered, Mr. O’Brien wrote to the Minister as follows -
I have just received a communication from the Royal Agricultural Society of New South Wales stating that the tender of Captain Bentley to supply a band for the Royal Show has been accepted by the council of the above society. Captain Bentley is Brigade Bandmaster of the Defence Forces, New South “ Wales, and presided at a meeting at the Queen’s Hall last week over a small number of recalcitrant members of the union with the object of forming an opposition musicians’ union. I respectfully suggest for your consideration that Captain Bentley should bc relieved of his duty as Brigade Bandmaster if he enters into controversial politics and industrial disputes with organized industrial unions.
Honorable members opposite have always expressed themselves before the country as being the determined advocates of political liberty of conscience for all persons in the Public Service; and here we have the case of a brigade bandmaster and a militia officer. No question of unionist versus non-unionist arises, nor is the question of preference involved. This man’s individual right to indulge in political or industrial controversy is what is called in question.
– Did he leave the other union before he started the new one?
– From the papers, I think so, but I am not sure.
– Then he was a nonunionist at the time.
– No; he had formed a new union which. had been duly registered. My impression is that the other union had its registration cancelled on account of its rules. However, the new union was actually formed, and it was, apparently, a bonâ fide organization.
-Does the honorable member connect this with the motion for the third reading of the Bill ?
– I understand that the Bill is essentially to deal with the defences of Australia and, necessarily, with the Defence Forces.
– I have allowed a certain amount of latitude in a general discussion, but the honorable member will see that any further latitude must not be permitted.
– I shall endeavour to be as brief as possible; and I shall not argue the question; indeed, the point is so abundantly clear as to admit of no argument. There is the greatest feeling in military circles in New South Wales about this business; and it will not help the Defence Forces if the sort of thing of which I complain is allowed to continue. The Minister of Defence asked for a special report, and particularly pointed to the paragraphs I have read. The AdjutantGeneral reported, not against this man participating in the way to which exception has been taken, but expressing a doubt whether the position was really necessary in the interests of the Forces. Following that, the Minister gave Captain Bentley notice that his engagement would be terminated, Thereupon the Commandant in New South Wales wrote to the Minister strongly protesting, in the interests of efficiency and economy alike - these are his words - that the position should be continued. In spite of this, however, the services of Captain Bentley were dispensed with. I merely state, without comment, that this man has been “ fired “ because he exercised individual liberty of conscience; and I suggest that such an occurrence ought not to be possible if we are to have anything like cohesion in the Military Forces of the Comm on wealth .
Question resolved in the affirmative.
Bill read a third time.
In Committee of Ways and Means:
– I move -
That an Income Tax be imposed on incomes derived directly or indirectly from sources in Australia, and consisting of income derived from personal exertion and income from property at the following rates, viz. : -
In respect of the income from personal exertion - the rate under the Income Tax Act 1915’ that would have been applicable if the total taxable income of the taxpayer had been derived exclusively from personal exertion; and
in respect of the income from property - the rate under the Income Tax Act 1915 that would have been applicable if the total taxable income of the taxpayer had been derived exclusively from property.
The amendment of the Act has been necessitated by the partial failure of the formula which some honorable members were unable to appreciate, but which, I am glad to say, they heartily indorsed. It has been found that in applying the formula. - which was admittedly perfect - to the circumstances of a mixed income, there results a set of conditions incompatible with the principles of equity and logic which underlie the measure. Practically, what the Bill proposes is to remove an anomaly under which a man who has an income derivable from property and from personal exertion pays less tax than does a man who derives an income wholly from personal exertion ; whereas it was intended that the man who receives income from personal exertion should pay at a lower rate than one who derives his income from property. In short, what the amendment does is, in the case of a mixed income, to tax each class of income at the rate at which it would have been taxed if the whole of the income had been derived from personal exertion or from property, as the case may be. There are no departures from the principles of the Act. The amendment is recommended by the Commissioner as one that, he assures me, will very greatly facilitate the work of the office. The staff finds itself pressed by continual labours in reducing the formula to a shape in which it can be comprehended by the taxpayer; and this amendment will enable that work to be done quite simply. I have been asked whether it is necessary to differentiate between income derived from personal exertion and income from property. That distinction is maintained in every income tax in the world. Certainly, it is in all the Australian States and in Great Britain, and it is not proposed to depart from that principle here.
.- As far as I can understand from what the Prime Minister has just said, the curves appear to have got a bit mixed.
– The difficulty really arises from applying a curve of the third degree to incomes of variable dimensions.
– What I did not understand from what the Prime Minister said was how it is proposed to get over the difficulty of assessing, on the graduated scale, incomes derived from both’ personal exertion and property. In the case of a man having an income of £1,000 a year from personal exertion, the position is plain sailing; but, supposing £500 of that income is derived from personal exertion and £500 from capital, how is the graduated scale to be applied so that the £500 from property will be assessed on the higher -grade?
– The first £500 will be taxed as though an income of £1,000 were obtained from personal exertion. The second £500 will be taxed as though all were derived from property.
– That seems a very easy way of getting at it, so far as arithmetical calculation is concerned, but has the Prime Minister any actual results worked -out to show exactly what the result of his proposal will be ?
– In ; such . a case, a man will pay more than he would pay if his income were wholly derived from personal exertion, and he will pay less than he would pay if it were all derived from property.
– One is asked to deal with the subject without full knowledge of exactly what it is proposed to do, and without knowing what the effects will be.
– The honorable member will see the Bill when the resolution is passed.
– What I wanted to say is preliminary to what we are about to do; because the practice has lately been that when proposals of this kind have come forward, they have been rushed through before honorable members really knew what had transpired, and the Government have had to come along with . an amending Bill afterwards. We hope the House will rise this week, and -I presume there will be no further meeting for a considerable time - until the greater portion of the income tax has been collected. We want, therefore, to be reasonably sure that what we are now proposing will meet ‘the situation, and not be inequitable to anybody. I made these few remarks in order to ask the Prime Minister to furnish us with some concrete examples of how the proposal will work-out.
– I will have one ortwo cases worked out.
.- I understand the object of ‘the Attorney-General is to meet the caseof where an income is divided - say, an income of £1,000, of which £600 is derived -from property and £400 from personal exertion. At present;, one would be taxedonthescale of £600 andtheotheronthe scale of £400 withoutregardto thetotal of £1,000, and that applies only to a case where the actual learning is mixed. But it is not. possible really to differentiate between earnings from property and from personal exertion. For the future, . an incomemade up. in the -manner I have suggested will be taxed at the £1,000 rate in respect of the £600, and . at the £1,000 ratein respect of the £400, and the taxpayer will have to pay more than he would have to pay if the thing -were left alone. It willbe a mixed result, but, : as the problem is . a mixed one,- I suppose it as logical that (the result should also be mixed.
Question resolved in the affirmative.
Standing Orders suspended, and resolution adopted.
– I should like torise to a point of order at this stage. It seems to me that we are developing a practice that is absolutely prohibitive of intelligent discussion. Before a Bill has been introduced, and before we know anything whatever about it, we are asked tosuspend the Standing Orders for the purpose of enabling that Bill to pass all its stages.
– That motionhasalready been carried.
– It seems to me that it was in the wrong place altogether. The proper time to move the suspension -of the Standing Orders is when the House has the Bill before it, and knows what it issuspending the Standing Orders for. It seems to me to be an unintelligent proceeding for us to suspend our Standing. Orders before we know what we are suspending them lor.
– There is a difference when the procedure relates to” theCommittee of Supply or of Ways and Means. Theusual . course would ‘be. for the adoption of the report to be. taken on the following day, but it is desired that this Bill should pass through all its stages to-night. Under -such circumstances, it -would be necessary tosecure the suspension of -the Standing. Orders before the report is -adopted, otherwise that stage would be postponeduntil to-morrow. The honorable member will see, however, that the question of onethod has nothing to . do with the Chair. That concerns the -Government. I quite understand what the honorable member . means,butI think hewill see my point; - the. point that, does concern, the Chair - which is- that this motion could only be taken to-morrow unless the Standing Orders had been suspended.
– Is not the proper time and place for the suspension of the Standing Orders when the Bill has been introduced and reaches the formal stage? The report having been adopted, in the ordinary course the Bill founded on the report will be brought in, and’ the House having, seen it - that would be the proper time to ask for the suspension of the Standing Orders. But here we are suspending the Standing Orders on a matter of which we know nothing, and which is not before the Chair.
– But that does, not prevent our discussing it at the ordinarystage..
– But we cannot apply urgency to a- matter about which we know nothing.
– The honorable member can have as long as. he likes when the Bill is introduced. We want to get the BiH in.
– Then, does this mean anything at all ? The Bill could be introduced to the House without the suspension.
– No, it could not.
– If the honorable member will look at standing order No. 244 he will, see that it reads -
Any report of resolutions from the Committees of Supply and Ways, and Means shall be ordered- to be received- on a future day.
The ordinary course, on my receiving a report from the Chairman of Committees of Ways and Means would be to deal with it to-morrow, or at. some future date. That cannot be done on this occasion, because tha Minister desires that the Bill shall be gone on with to-night. Therefore, before the Bill can be introduced, it is necessary to secure the suspension of the Standing Orders.
That Mr. Hughes and Mr. Higgs do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Hughes, and read a first time.
– I should like to have this: matter settled. I am still not clear about, it. I take it that, in accord ance with the Standing Orders, the utmost that can be done at this stage is to so far suspend the Standing Orders as would prevent the introduction of the. Bill. Then would come the further proposition to suspend the Standing Orders, relative to the remaining stages. Otherwise, the position is that we have actuallydeclared to be urgent a measure, abo’it which we know absolutely nothing.
– I would point out; to the honorable member that on the business-paper is. a, contingent notice ofmotion, on any report, that the Standing Orders be suspended to enable the remaining stages to be passed without delay. The “ remaining stages “ would be the report, the first reading, the second reading, the Committee, and the third reading stages.
– There is still the old-fashioned motion, “ That so much of the Standing Orders be. suspended as will preclude the introduction of this Bill.” That, I submit,, is the motion that should, have, been submitted.
– I move -
That this Bill be now read a second time.
It has been found! that under the Act as it-, stands a person whose income is derived partly from personal exertion and partly from property will pay less taxation, than he would pay were his income derived wholly from personal exertion. Eor example, a man whose income is £5,000,. half of which is earned by personal exertion and half derivedfrom property, will pay less than a man whose income is £5,000, wholly derived from personal exertion. It was intended, however, that the taxation on incomes derived from property should be at a higher rate than that of income from personal exertion. It is now proposed , ‘ therefore, that in the case of a mixed income - take again, by way of illustration, the income of a man who earns £2,500 by personal exertion and receives £2,500 from property - the charge on so much as has been earned by personal exertion shall be at the rate which would be levied had the whole income been so earned, and that the rate levied on what was derived from property shall be that which would be levied had the whole income been derived from property. The tax on a mixed income will thus be greater than that on an income of the same amount earned wholly by personal exertion, but less than that on an income derived wholly from property.
– It is a wonderful thing that propositions founded on mathematical principles which are supposed to be unerring and incapable of terminological or other inexactitude, should have gone wrong on the first application. Can we be sure that the mathematician is right in what is now proposed ? I am inclined to think that it would be better to abandon the curves referred to in the schedule, and revert to the old methods of calculation. According to Mr. Knibbs, the curves are right; but, apparently, the application of them is wrong. Mr. Nash, of the Sydney Daily Telegraph, has shown that the formula when applied does not give the result set out in the tables, and I have been given to understand that Mr. Knibbs has some secret method of applying it, which may or may not be in accordance with the known principles of mathematics, but which brings in some element other than that which has been made public, in order to achieve the results set out in the tables. In other words, the formula: and the tables do not agree. 4
– The formula which relates to incomes derived from personal exertion could be worked out by a boy capable of passing the junior public examination. As to the curve of the second degree, the Statistician himself worked out the examples that have been given, and is prepared to vouch for their accuracy. He says that when he explained the matter to the Professor of Mathematics in the Sydney University, the latter admitted that he had been in the wrong.
– My information has been derived from statements, written by Mr. Nash, which have aprpeared in the financial columns of the Daily Telegraph, and from what has been published by others who have .busied themselves with these mathematical problems. I rely on what they say for the statement that the formulas and the results do not agree.
– It is an axiom of government that the Commonwealth Statistician cannot be wrong.
– Obviously, things have gone wrong at the first trial. I hope, however, that, to use the language of Brother 0’ Malley, “ She is right this time.” Certainly I am not able to prove* that the formulae are wrong.
Question resolved in the affirmative.
Bill read a second time.’
In Committee :
Clause 1 agreed to.°
Clause 2 (Amendment of section 4).
Section proposed to be amended-
Section 4 (Rate of income tax).
– I understand that if a man has an income of £5,000, earned wholly by personal exertion, he will be taxed at the rate set out in the first schedule of the principal Act, and at the rate set out in the second schedule if his income is derived wholly from property. I understand further that, under the Bill, a man who has a mixed income, earning, say, £2,500 as salary and getting £2,500 from property, will be charged according to a third rate; that is to say he will be taxed on the £2,500 which he earns as if the whole £5,000 were derived from personal exertion, and on the £2,500 derived from property as if the whole income were derived from property. Thus we have the personal exertion rate, which is the lowest, the mixed income rate, and the property rate, which is the highest. We must take it for granted, on the assurance of the mathematician, that this method will work correctly.
.- Before the clause is passed I should like to have some illustrations of the manner in which it will work, as I am doubtful as to its actual effect. I know what the Prime Minister wishes to do; but I am not clear as to the result. In providing the extraordinary method of calculation provided for in the Act, the Commonwealth Statistician seems to have adopted a set of more or less arbitrary figures approximating to a curve of the second or third degree. From what I have been able to read, I do not think that the mathematical calculation is scientifically correct, and I do not know what induced the Government to adopt this abstruse method of calculation. If the Government desired particularly to provide for a much higher rate in respect of incomes over and above a certain amount, they could have done so by almost any method of direct calculation. The position now is, however,, that no one who has not had a first class University education, and a particularly good course in mathematics, is able to calculate what is the rate of the tax payable on income from property. I suppose that it is too late now to ask the Government to recast their schedule, but if, in regard to income from personal exertion or property, they had adopted the simple method of a curve in the first degree, they might have expressed thp rate in clear terms. They could have provided for a definite increase at a certain point, taking another curve of the first degree, and finally, for a still higher jump if necessary, so as to secure all that they desired without putting taxpayers to the great trouble to which they will be put under the system now in force. Every one is under the impression that he is being “ taken down,” and none of the skilled mathematicians in the country seem to agree as to the results obtained by Mr. Knibbs’ calculation. I have not gone into the question very carefully, beyond reading statements on the subject in the public press and in some of the journals, but I am informed that the general impression among those best able to judge is that Mr. Knibbs has adopted a purely arbitrary calculation, which is not mathematically or scientifically correct according to the formula? expressed in the Bill. It seems to me that the Government are causing immense trouble by the method adopted. I would suggest that if they desire to derive a considerable amount of extra revenue from the larger incomes they should adopt the direct method instead of attempting to get the exact gradation on every pound from fi of taxable income up to the point at which all income carries the maximum rate. They could provide for a gradation on every pound up to a certain sum, and then take a definite step upwards, fixing a higher rate. They could then have finally a gradation on every pound up to the next step. The merest schoolboy could then calculate to a penny what tax had to be paid on any income. Under the existing circumstances very few taxpayers can do so.
– I am sorry that the honorable member for Richmond does not agree with the method adopted by the Government for determining the rate of tax. There seems to be in this Assembly an archaic prejudice against science and the advancement of learning. This I regret. It is a most melancholy portent for our future when science and scientific men are spoken of in these terms, and when that which is apparent and within the reach of the schoolboy is preferred. It seems to me to be a halting back to the stone age. I shall not, however, waste any time in discussing it. I shall tell honorable members what the result of the amendment will be. That, after all, is far more important to the man outside, who, I venture to say, would rather be taxed fairly, even if the rate has to be worked out by mathematicians, than have the simple method to which the honorable member has referred. It is simple because it is inequitable, and has nothing to recommend it except that it is the plain, common, ancient method of highway robbery.
– The trouble is that the unfortunate victim under the third degree does not know whether he is being taxed fairly or not.
– He has the assurance of the Commonwealth Statistician. What, more does he want? These sneers at thft formula do not come well from men who,, when ill, obtain a prescription which they cannot decipher or understand, have it , made up. go to bed, take it, and, by faith in God and the doctor, get better.
– They more often go to the grave.
– Then they get an inscription on their tombstones which they also cannot understand. I shall give the Committee the calculations made by my mathematical staff. The tax on an income of £1,000 from personal exertion amounts to £28 2s. 6d., and from property to £43 17s. 9d. That is the rate of tax, and it is not affected by the’ amendment. Under the Act as it stands, a man with an income of £1,000, £600 of which is derived from personal exertion and £400 from property, would pay £21 15s. 10d., as against £28 2s. 6d. that he would pay if the £1,000 had been derived wholly from personal exertion. Under the Bill he will pay £34 8s. 7d., as against £43 17s. 9d. that he would pay if the whole of his income had been derived from property. Thus you get the application of the three schedules in this- way : If the whole £1,000 of income is derived’ from, personal exertion, the taxpayer- pays £28 2s. 6d. Assuming that- the principle of: the Bill is approved, on a mixed income of £600’’ from personal exertion and £400 from property he will pay £3.4 8s. 7d., and if. this £1,000 were wholly from property £43 17s. 9d. Under the Act as it stands’, he would pay only £21. 15s.10d. if he had a mixed income of. the- amount stated, whereas he. would, pay £28. 2s. 6d. if he had an income derived wholly from personal, exertion. It is to remove that injustice and that departure from the principle of the Act, which is to tax incomes derived from personal exertion at a lower rate than incomes from property, that this amendment is proposed’.
.- I do not see how. it would be possible to avoid, this amendment of the principal Act,, considering that that Act is progressive along pounds, and that this inconvenience will arise, therefore, with every pound that is taxed. In the case- of an income of £1,000 from- personal exertion,, the rate increases with every pound,, whereas- in the case of such an income from property it runs, along a series of. increases. Under the State laws, there is a very considerable interval between the progressive rates as compared with that for which the Commonwealth law provides, so that the inconvenience under the existing Commonwealth law occurs very often-, and only infrequently under the State systems. We must, it seems to me, make this amendment, and I do not know what system other than that adopted by the Attorney-General could1 be followed. The rate of tax that a man will have to pay will be determined first by the total of his income. Under the law as it stands that is not the position where income is derived from two sources - personal exertion and property. The tax must be determined by the total of the taxpayer’s income, and by the amount derived respectively from property and from personal exertion.
Clause agreed to.
Title agreed to.
Bill reported without amendment: report adopted.
Bill read a third time.
.- I move -
That this Bill, be now read a second time.
The construction’ of this railway will- not be entered upon until the Public Works Committee has reported- upon it. Under the Public Works Committee Act, such an undertaking must, be submitted to- the Committee,, and. the House, has already agreed’ to refer it to- that body. No appropriation of revenue will be necessary under this Bill, so that we do not require to have’ a message from the GovernorGeneral. An appropriation is being made under the Loan Bill now before the House. This measure provides simply for the construction of 65 miles of railway from the Katherine River to the Bitter Springs, making a total of 265 miles of railway from Port Darwin. The estimated cost is £320,000,. including provision for station accommodation-, telegraph line, and water supply. . The estimate does not include the cost of a. bridge across the. Katherine River,, as the line will commence from- the south side of that river. It provides for 60-lb. rails and fastenings, and for the construction of the line in such a way that- it. may be converted from the 3-ft.. 6-in. gauge to the 4-ft. 8½-in. gauge, without alteration of the earthworks, bridges-, waterways, and sleepers. The detail’s of the estimates are: - Clearing, and grubbing, £2,868; earthworks, £58,889; rails, fastenings, and sleepers, £140,989; bridges and culverts, £13,362; stations, £14,819.
– There is something wrong about that item.
– It does seem large. When building the railway through new country in. the State of Texas, no stations are made. Ballasting is. estimated at £66,598 - that also seems high - telegraphs, £7,149; miscellaneous, £88; contingencies, £15,238; total £320,000, or £4,938 0s. 2d. per mile. As I told the House last week, there are at present between 500 and 600 men employed in completing the original section of the Katherine River railway. The idea is that if this railwav is built to the good country about Bitter Springs, those people will be settled on the land. Up till . thepresent . time they have been getting acclimatised and strengthening themselves to stand the climate. There is hope of a big settlement taking place, on the good country when . the railway reaches it. We are dealing with a great territory sparsely populated, and it seems to me that if Parliament intends to ever build that railway and settle the country, the line . ought not to . stop at the Katherine River., but should be continued to Bitter Springs, where we may expect settlement to follow. Recently a large number of people have been taken to the Territory, with their wives and families. The idea was to -give them employment on railway construction, and afterwards, when they had become accustomed to the climate, to settle them on the land, I am informed that if the line is carried south from Katherine River to Bitter Springs it will reach a better class of country, a good deal of which will be suitable for settlement, and the terminus will also be much nearer to the existing settlement beyond the Roper River. The line will facilitate cattle traffic from Elsie Creek and Hodgson Downs, and probably other grazing leases in the vicinity. It is stated that there is plenty of good cattleranching country to be developed, and that this line will enable the stock to be brought to market. Bitter Springs is a generally recognised centre, and is on the main road leading to the settlement along the Roper River. There is also a very fine water supply for purposes of settlement, travelling . stock, and locomotive requirements. I must admit that the estimated revenue is very small, but these developmental railways are not built for revenue; they are built for settlement. The estimated working expenses, exclusive of interest on capital cost, are £11,800, and the estimated revenue, £12,000.
Mr.Rich ard Foster. - How many trains a week are provided for ?
– I suppose there will be one a month, at ‘any Tate. Steel sleepers are generally used in the Northern Territory, and ‘this line ought to be built with steel sleepers, butthey are ‘not obtainable at the present time for less than : 19s.each.
– Then you ‘ought to wait . until you can ‘get steelsleepers.
– How are the powellised karrisleepers lasting ?
– I am told that they are : all -right.
– The white ants will bore through a billiard ball. After the (experience of South Australia, you are simply wasting money in using wooden sleepers.
– Why has the price of steel sleepers doubled?
– Owing to the war, every factory in the United States of America, and even that at Newcastle,, is . working three shifts.
– I suppose the bridge over the Katherine River is not provided for because you cannot get steel ?
-If ants will eat wooden sleepers they will eat a wooden bridge. The proposed route has been surveyed recently, and I am told that it is not a deviation from the original direction.
– Did the surveyor say that the land is good ?
– I have not seen the surveyor, but the engineers say that the land is much better than any other land there. I do not know the quality of the other land. I suppose it does not comprise what would be called valuable loamy soil, but even if we decided to let the whole of the Northern Territory as a great cattle ranch, carrying 30,000,000 or 40,000,000 head of cattle, it would still require a railway.
– Do you not seriously think that you had better find out something about the matter before submitting the proposal to the House?
– I do not know where to find any more information. I have all the authorities here. I have been told all they know.
– Have you had a report from the Public Works Committee ?
– That Committee is “on the job” now.
– Will the Committee present a report . soon ?
-The chairman . of thatCommittee is present now.
– We have already examined two witnesses.
– Shall we have a report before the contemplated adjournment’?
Mr.KING O’MALLEY. - I do nol think so. I suppose it is of no use reading the report of the engineer?
– I think it is.
– Then, with the permission of Mr. Speaker, I shall read the report of the engineer, who is a most capable and conscientious man.
-He is a good railway man, but that does not mean that he is a judge of country.
– All I know ia that Mr. J. J. Hill, an American engineer, who was born very close to where I myself was born, is one of the best judges of country. However, this is what Mr. Bell says -
The barren, rock-outcropping country for a great distance between Pine Creek and Katherine River gives way to good country about 10 miles north of the Katherine, and with the exception of a belt of limestone outcrop a few miles south of the Katherine there is a very large area of free, open, chocolate-coloured soil of a sandy character, somewhat thickly timbered. This country, with slight changes here and there, extends to Bitter Springs, and also on to Daly Waters. The appearance of the chocolate-coloured, sandy loam rises just after the first rains is very attractive, and is not unlike the Pine and Belaar country round Mildura, Victoria. It is probable that, with railway communication, a portion of this land would be profitably situated for settlement.
– That indicates a very dry country.
– I can assure the honorable member that it took years and years in America to get Congress to vote a few pounds to run the first transcontinental line, because, as it was said, a crow would have to carry his water-bag across the country. As a matter of fact, there are now twelve transcontinental railways across the continent, and in the country south of the Rockies 19,000,000 people have settled. Further, un land which it was said would not grow anything, the settlers are now raising 40 bushels to 50 bushels of wheat, and 100 bushels of corn, to the acre. That land had not such encomiums passed upon it as are passed on the land which the proposed railway will traverse. It is wonderful how settlement pushes on, and how, by growing trees and by other methods, rain is brought into a district. Mr. Bell goes on to say -
Bitter Springs is on the Roper River, which, at this point, turns and runs thence east to the Gulf of Carpentaria, emptying into Limmen Bight. The Roper River country was thoroughly examined by the Scientific Expedition in 1011, consisting of Professors Spencer and Gilruth, Dr. Woolnough, and Dr. Brcinl, and their report was very optimistic regarding its possibilities. Coming back along the proposed line again, there is good country along the King River southwards through Dugan’s holding towards the junction with the Katherine, and also easterly until the mining area is reached, which is now known as Maranboy Tin Field.
Dr. Jensen is very sanguine of the permanency of these lodes, . and predicts a prosperous future for the field. The Government have already spent large sums of money in roadmaking, battery provision, and erection, &c, but concentrates will still have to be carted 40 miles to Katherine River station, unless the railway is extended. At 2s 6d. to 3s. per ton per mile, it is apparent that much of the lower-grade ore will have to be discarded; whereas Maranboy is only 12 miles from the proposed extension to Bitter Springs.
Whilst the rainfall decreases in a recognised proportion from Darwin’s 62 inches to Daly Waters’ 17 inches, the climate is noticeably better in the interior; the humidity is greatly reduced, and there are several months in the dry season when night temperatures on occasions fall 40 degrees Fahr. This means much in recuperative effect compared with the country closer in to the seaboard, where humidity is so severe. Every mile of constructed railway brings nearer the boring and settlement of the fine Barclay Tableland, with its great productive possibilities. (Sgd.) Norris G. Bell,
Engineer-in-Chief and Acting Commissioner.
– That report is from the Resident Engineer in the Territory ?
– It is signed” by Mr. Bell.
– Quite so; but it is made up from notes sent along from the Territory.
– I thought I had already stated that. However, Mr. Bell says -
Notes regarding type of country, &c, as prepared from information supplied by Mr. Hobler as a result of his visit to the Territory, supplemented by particulars supplied by Mr. H. V. Francis, who was stationed in the Northern Territory for a considerable time.
– Mr. Hobler was there for about half-an-hour !
– Without detaining the House any further, and in the hope that honorable members will permit the Bill to go through, I submit the motion.
– The procedure we are adopting is most extraordinary. We passed an Act of Parliament prescribing a method for the carrying out of public works; and at considerable trouble and expense a Committee of Public Works was appointed, with the special function of making inquiry in every case where a certain amount of expenditure was involved. That Committee has to report to the House, and, on the receipt of the report, the House, by resolution, must declare whether or not it is expedient that the work proposed shall be carried out. In the present case, without plans or specifications - without any investigation or report whatever - we are asked to authorize a work representing an expenditure of £320,000. This means that we are practically setting aside the provisions of the Act by which the Public Works Committee came into existence; and I do not think that this meets with the approval of the House generally. The Public Works Committee Act was supported by both sides in order that there might be some control over expenditure on public works. We are asked to pass exactly the same kind of Bill that we were asked to pass to authorize the construction of the transcontinental railway between the east and west. A Minister came down with a Bill asking for a blank cheque to meet an expenditure which now promises to be something like £6,000,000 or £7,000,000, without submitting plans, specifications, or giving any information whatever. Subsequently the House was asked, from time to time, to vote money towards the completion of the scheme. The idea of the Public Works Committee Act is that we shall have most carefully prepared estimates in order to enable the House to exercise reasonable discretion. Already a part of the proposed transcontinental line has been recently constructed, but we do not know what the cost per mile has been, or whether the estimates have been exceeded, or whether the figures now before us are based upon those previous estimates. I know that’ no Railway Department has a more competent engineer than Mr. Bell; the Commonwealth is fortunate in possessing such an officer, and his judgment may be trusted, but I am sure that the sum of £14,000 set down for stations cannot mean the construction of station buildings.
– It does not. We are asked to do the same as has been done on the east-west railway, and it is simply outrageous !
– The difficulty is that we are acting absolutely in the dark, and it amounts almost to a public scandal to authorize expenditure in this way ; the only value of the report that is to be presented is that it may give some guidance to the Minister; but such reports were intended, not for the guidance of the Minister, but for the guidance of the House and the public generally. Of course, the present Minister has only just assumed office, but he is a member of a Cabinet which takes the whole responsibility in a matter of this kind, and that responsibility is a serious one. . Surely, during the term of office of the present Government, some railway policy should have been evolved ? They had three years of power with an interregnum, during which the honorable member for Angas, as a member of a succeeding Government, laid on the table a memorandum showing full details of a railway policy. There was a distinct policy in view; and during the last thirteen months there has been ample time for the consideration of a definite policy, as well as for the preparation of estimates and surveys for the construction of the railway. I want to enter my protest against this continuation of the old system of sanctioning expenditure without knowing what it is we are committing ourselves to. The House is quite in the dark. It is asked to authorize the Minister to construct a railway which he says will cost £320,000; and when the bill comes in we shall probably find ourselves in the same position that we have been in with regard to other works. I hope the Minister will pay due regard to economy in carrying out this scheme, and that he will not sanction expenditure that is not necessary.
– I will stop the expenditure on those stations, anyway.
– I hope the Minister will keep a strict eye on every part of this work. Heavy obligations are facing the country in connexion with the war. We have committed ourselves to a policy in connexion with the rivers, so that this is not the time for extravagance in any direction. Private individuals are being asked to exercise economy, but it seems hypocrisy to advise people to practise that which the Government itself will not practise. Therefore, I hope the Minister will exercise the business acumen for which he is credited and keep the cost of this railway down to the greatest extent possible. I do not see how we can do other than allow the Bill to go through; but I hops,before work is commenced, that . the Public Works Committee will make a thorough investigation, and present . something more than the academic report the Minister has Just put f orward. I hope the Committee will insist unon having . definite plans and specifications from responsible officials, so that a specific estimate of the cost of the work will be available.
– Does the honorable member expect the Public Works Committee to . go out and get the information ?
– That is a matter on which I shall not express an opinion. If the Committee do not go to ‘the Northern Territory., they ought ‘to get the expert evidence of men from the Northern Territory, and make an inquiry that will be of more value than a mere superficial investigation.
– It is ‘the last time that I will bring anything like this forward without having it ‘thoroughly investigated.
-I am glad to hear the Minister say that. I am sure his words will be heard with satisfaction on both sides of the House.
.- I think the House should enter its protest against the manner in which . this railway proposition has been introduced, and I think it would have been better if the Bill had contained a clause stipulating that the Public Works Committee Act should not apply to this work, because, to refer the proposition to the Committee after already having . sanctioned the railway seems to be nothing less than a farce. Even if the Bill were made operative, . subject to the Committee’s report, that report, to be valuable, would necessitate the members of the Committee going over the country and seeing where the railway is being laid out. In Victoria, . every Railway Bill contains a schedule setting out the . route and giving the Minister limited power of deviation. It is true this Bill -follows on . the lines of the last Bill, !but there is.no definite route stated. . Members . are . simply told that the line will run from one . place to another, and are asked to ‘sanction tha proposal “ as surveyed on the ground.” What does this House know about such a survey ? We do not know wherethe survey pegs are. We do not even know., and I ‘do not know whether the Minister can tell us, whether the railway has been surveyed. All we know is that the’ railway will begin at the Katherine River and end at Bitter Springs. The Minister toid usthat the Bill did not include provision for the bridge across the Katherine. When the Bill authorizing the line from Pine Creek to the Katherine was passed, no provision was then made for bridging the river, and the railway stopped on the north side. This railway will commence on the south side of the river. What is the good of that if the railway is to be continuous ? We were ‘told on a previous occasion ‘that the bridge -would cost £170,000. Now we are asked to spend £320,000; and before the proposed railway can be -connected with that already constructed, another £170,000 will have to be spent.
Mr.Fenton. - A temporary bridge will be put up.
– Every railway in Victoria has had a temporary bridge constructed over rivers for the purposes of the -work, but”we know very we’ll ‘that passengers are not carried until a permanent bridge is constructed. At the present time thisrailway is quite incomplete. There is no authorized service across the Katherine either of a temporary or permanent nature, and the fact that the only information we have is that -this is to.be a railway from the Katherine River -to the Bitter Springs without any route being laid down, -or any information given regarding a survey, and the fact that the Public Works Committee ‘have not reported on the proposal atall, renders the introduction of this -Bill about as unsatisfactory as any such proposal could very well be. Were it not that ‘there are a number of railway men waiting for the continuation . of ‘this work, the Housewould be . compelled tohold up ‘this proposal pendinga submission of better information. I hope that ‘in future no Minister will ever introduce a Railway Bill intothisHouseinthe way in which this Bill has been introduced.
– From the statement madebythe Minister himself in introducing this Bill, I think it would be much better to let thewhole matter go before the Public ‘WorksCommittee. The only excuse for its introduction in its present form is that there . are 600men likely tobe thrown out of employment. It would be cheaperto find . these menother work ; it would . even fee cheaper to pay them for doing nothing, rather- than construct the railway on- this system. The Minister stated that it would cost £1,000 per mile to ballast the line, and if it is going to involve such an amount, it would be cheaper- to find these men employment somewhere else. Then £141,000 is to be spent on stations.
– I have stopped; that.
– Then we shall have, probably,, the money spent without getting anything for it. It seems to me an extraordinary proceeding, seeing that there is a railway on one side of the Katherine River, for the Government to now propose- to construct, a railway on the other side, without any provision being made for crossing.
– That is nothing. They cross at St. Croix in a punt, and they, run 4 miles over Venetia Bay, in California, on a punt.
– Perhaps we had better get an aeroplane to take the trains across. From the statement made by the Minister himself, I think the House would be very foolish if- they passed this Bill to-night. It would be far better to find these men something else to do whilst the Public “Works. Committee makes its inquiry. We have been shown a map upon which the Katherine River and’ Bitter Springs are marked, but no details are given regarding the railway, and,, as I said . before, it would be better to pay these men and keep them out of employment rather than pass a Railway Bill on such information as we have before us. When the proposal has been examined by the Public Works Committee. Parliament can deal with it by resolution.
– How many of the men will settle there?
– As the honorable member has said, they are getting acclimatized, and perhaps, if the white ants will leave them alone, will settle. We are asked to vote for a supply of wooden sleepers, but we are told that the white ants would destroy such sleepers in no time, and that it is necessary to use steel sleepers. For the reasons I have given, I shall vote against the second reading of the Bill, and shall call for a division against.it.
.- I support the proposition of the Government, because I think that the Northern
Territory cannot be developed without railways; but, in my opinion, the Minister of External Affairs should have chaige of the Bill, because the construction of railways is part, of the policy for- the development of the Northern Territory, for which he is responsible, the Department of Home Affairs being- merely the constructing Department.. If the Minister of Home; Affairs were in charge of the Bill merely because of the illness of his colleague, I should have nothing to say against the arrangement, but from the beginning this Bill has been in charge of the Minister of Home Affairs. Having been. Minister of External Affairs, I know that the post is. not one of which the holder is overworked. Any Minister who goes from another Department to the Department of External Affairs is aware that the latter post is not an overworked one, whereas the Minister of Home Affairs occupies a very busy position. Naturally, because of my association for a time with its administration, and because of my visit to it, I take a considerable interest in the development of the JJbrthern Territory. Its settlement is one of the . biggest problems that this Parliament has to face, though it is a problem that we can solve. The construction of this railway by the Home Affairs Department is quite a proper thing. The extension of the line from Pine Creek to the Katherine River was proposed in this Hpuse by the Minister of External Affairs, and commenced by his Department, but it was wisely determined by the Cook Administration to hand over the work of construction to the Home Affairs Department.
– But it was understood that the Minister of External Affairs was responsible for the policy of the line.
– Quite so. In New South Wales, the Minister for Works used to have charge of all measures for railway construction; the Railways Commissioners were not allowed to dictate the railway policy of the country. It is to the Minister of External Affairs that honorable members must apply for information regarding a proposal of this kind.
– He has not an engineering staff.
– He could obtain from the Home Affairs Department any engineering information that he might require. It is he who should state the policy of the Government regarding railway construction in the Northern Territory.
– This is to be part of the trunk line.
– The proposed railway will be wholly within the Northern ^Territory, and the Minister of External Affairs, who has held office for thirteen months, should be in a better position to give us information regarding it than is the Minister of Home Affairs. This is in. no sense a personal matter. I regard the procedure that has been followed as wrong, because the Minister of Home Affairs cannot be responsible for the policy of the line.
.- I shall support the honorable member for Corangamite in ‘ his objection to the Bill. No honorable member believes more than I do in having a comprehensive railway policy for the development of the Northern Territory which, from what I can gather, has a great future from both the miner’s and the stockman’s point of view. But the proposal has been wrongly introduced, and introduced at the wrong time, and the data is insufficient to enable us to come to a proper conclusion. We have had a report from Mr. Bell, whose engineering abilities are beyond question; and one from Mr. Hobler, who is also, I believe, a good railway engineer. But what we need are reports from men who could speak as to the stock-carrying capacity of the country, and its mineral possibilities.
– The Minister read from a report by Dr. Jensen.
– He may have given some little information regarding the mineral wealth of the country, but I heard nothing concerning its stockcarrying capacity. It is said that the country is limestone in conjunction with chocolate soil; and we know that such country is suited to lucerne, the king of ‘fodders. But we do not know what its rainfall is. Lucerne will stand any amount of heat, but needs a good deal of moisture, and we require to be told, not only the annual rainfall of the district through which the line will pass, but also the distribution of the rain, before we can know the value of the country. We are asked, also, to sanction the use of timber sleepers for the construction of the railway; but from what I have heard, such sleepers would not last any time. A member interjects “ What about the powellising process?” That process is said to have proved a failure -
I was going to use a worse word. At any rate, I do not think that we should adopt it until it has been thoroughly proved.
– If there were lucerne, there would be no stock to put on it.
– Where there is lucerne, stock can easily be secured. But, as the hour is late, I ask leave to continue my speech on another occasion.
Leave granted; debate adjourned.
Business of the Session - Wheat Freights - Third Rail Demonstration at Tocumwal - Expeditionary Forces : Non-delivery of Mails.
– In moving -
That the House do now adjourn,
I should like to ask honorable members to make an effort to conclude the business by to-morrow evening. I may be permitted to offer the observation in regard to this session that we do not appear to get through any business, yet seem to find something to doevery day we meet. I would suggest either that we set to work and tackle a programme of legislation, or that we adjourn for the Christmas vacation. The adjournment proposal seems to be compatible with the wishes of most honorable members.
.- As I found it rather difficult this afternoon to convey to the House my impressions regarding a subject on which I addressed a question to the Prime Minister, I desire now to put myself right. In the early stages of the negotiations for the acquisition of wheat freights, I felt it my duty to put before the House the difficulties that presented themselves to my mind, and to show, as I think has been conclusively shown now to the Prime Minister, that the arrangement he had entered into would fail to provide a continuous market for our wheat, and would create such a dislocation that the coming harvest could not be financed and transported. I believe that the arguments that were put from this side of the House had good weight. I believe that they have borne good fruit, and I am now prepared to say that the arrangement which has ultimately been made will provide successfully for the wheat harvest.
– The honorable member’s argument was that the Government should not interfere at all.
– I did take the view that the Government should not have interfered, but shall not at this late bour touch on that point. I still have every reason to believe that the arrangement that was made in the first instance would not have pruved satisfactory. The present Prime Minister was so convinced as to that that he has abandoned it altogether, and has accepted a new one. I do not propose to say whether the new arrangement is his own creation or that of some one else. Honorable members, no doubt, will inquire for themselves on the subject. It is sufficient for me to say that the arrangement now entered into and accepted by the Prime Minister and the various States is altogether different from that which honorable members opposite were originally lauding. So much is it so that I believe that all the interests now concerned in wheat will be found assisting the Prime Minister and the States, who have entered into the new agreement to carry it through as expeditiously and as smoothly as possible.
.- I have a few observations to offer regarding the request made by the Prime Minister that we should try, if possible, to conclude our business to-morrow night. Many honorable members would like to be present at the demonstration of the thirdrail system which is to take place at Tocumwal on Friday next. A special train will run from Sydney, reaching Tocumwal a little after 3 on Friday afternoon, and upon its arrival the demonstration will take place.
– None of us have received invitations to be present.
– I am not responsible for that; I am merely mentioning what arrangements have been made. A special train will also leave Melbourne at 10.40 a.m. on Friday to take those who wish to go to Tocumwal to witness the demonstration. The representatives of New South Wales will be able to travel by that train, and to journey from Tocumwal by the special train, which will reach Sydney at 5.30 p.m. on Saturday. I hope that this demonstration will be successful.
If it proves that the process is a practical one, it will mean a saving of something like £40,000,000 to the people pf Australia, since it will enable trains to travel over two different railway systems without any - transfer of goods and passengers. Unless we can conclude the business of the session tomorrow, honorable members will not be able to see the demonstration, and I certainly hope that they will ‘ attend, irrespective of whether or not any invitations have been issued to them.
– I wish to bring under the notice of the Government a question relating to the arrangements made for the delivery of letters to our troops in Egypt. I received this morning a letter from the mother of a young man who has been fighting at the front, and I have been considering all day what I should do in regard to it. In the absence of the PostmasterGeneral, who is visiting another State, I thought of leaving the letter with the Department of Defence, but the Defence authorities say that they do not want to have anything to , do with it. Although the mother of this young man, who has now been invalided to England, has been writing to him regularly while at the front, he has not received any of her letterB. Members of his family have also been writing to him, but he received only one letter, and that was as far back as 5th July last.
– It is a common occurrence.
– I believe that it is; but there is something more serious to be told. The mother of this young man, by every mail leaving Australia for Egypt since his departure, has sent him a parcel of comforts. These parcels consisted, not of eatables, but of necessaries for a man at the front, including buttons, thread, and needles, to enable him to keep his uniform in good repair. She paid in freight and stamps on these parcels 7s. 6d., but not one of them has been delivered. I know that this is not an isolated case. Many men at the front have had a similar experience, and I hope that something will be done to put the mail arrangements in Egypt, and particularly in regard to . the delivery of parcels, on a proper footing.
– Even money orders do not reach the men.
– It would seem, that, some one over these must be reaching out for them. It is about time that, some one, took control of the matter, and saw, that these, parcels, and letters are- delivered to those to whom they axe- addressed.
.- I received yesterday a pitiful letter from, a lady whose, sum is. at. the front, complaining that, parcels- and letters sent by her to* him have never reached kim.. Even money orders which she has seat to him have not been delivered. She tells me that another son, who is fighting in Flanders,, receives letters from her regularly, and tbat be says. that, a letter from, home is what every man over there looks for. It helps to keep them cheery and bright. I brought, this letter under the notice of the Department of Defence,, and the Defence authorities, are cabling, to. Egypt to ascertain particulars. The fact mentioned by the honorable member for. Corangamite is hy no means singular. My correspondent wrote scathingly of the treatment that her son has received in this respect, and asks, what encouragement is thus offered other mothers to liat their bays volunteer. Money orders and drafts sent to Egypt have- not been delivered as addressed. There is. something very wrong with the system. The stereotyped reply tbat “ the matter will be looked into “ is not sufficient. - I hope that something will be done to insure that parcels and other mail matter gent to our beys at the- front -reach them. If we are to recruit as we hope to do, we must eive the men who enlist, an assurance that thev will at least be afforded- ordinary facilities to keep in touch with their friends at home,, and to reserve from them whatever little comforts they choose- to send. It is up to the Department to do something- to. improve the existing system.
– While I know nothing of the matter to which the honorable member for Corangamite has referred. I desire to say that if he will give me the letter received by him, I shall go into the question with the Minister of Defence and the PostmasterGeneral to see if some way cannot be devised to insure, as far as is humanly possible, that, the men at. the front shall get the letters and parcels directed to them. The honorable, membsr for Adelaide says that this is a typical case. I hope- it- is. not.; but. I shall accept kia statement that it. is-. In any- event, so. much, of a easa has bean brought out. asmakes imperative the closest inquiry to ascertain whether it is typical.. I do. not hesitate to say that men. who go tot the front to risk their lives - to endure,, every hour of the day, hardships such as appal one to contemplate, let alone ta undergo - ought, at least,, to have everything, that we can. do to make their lives as easy as possible. If the honorable, member for Corangamite will give me the. letter, and the honorable member for Adelaide will give me particulars of the case referred to by biro, 1 shall go- roto the matter with the Minister of Defence and the Postmaster-General at the earliest, possible moment,, with a view to putting the. system on a ship-shape footing, if. it is not already so.
Question resolved in the affirmative.
House adjourned at 10.30 p.m.
Cite as: Australia, House of Representatives, Debates, 10 November 1915, viewed 22 October 2017, <http://historichansard.net/hofreps/1915/19151110_reps_6_79/>.