8th Parliament · 1st Session
Mr. Speaker (Hon. Sir Elliot Johnson) took the chair at 11 a.m., and read prayers.
Mr.FENTON. - I wish to ask the Assistant Minister for Defence a question about a case which is, I think, only one of a number. The wife of a soldier who was gassed and injured on the battlefield after three years’ military service, and has since had to enter a mental hospital, is being forced to support her three young children, whom she . must leave at home to shift for themselves while she is at her employment. She gets no support from the Defence Department. Will the honorable gentleman instruct his officers that cases such as this must be attended to immediately, so that there may not be distress among the wives and children of those who fought for their country?
– I know nothing of the case referred to, which would seem to be one that should be brought under the notice of the Pensions Department. I shall be pleased if the honorable member will give me full particulars of it, to submit it to the proper authorities to ascertain if something cannot be done. I shall be only too glad in all these cases to do what is possible to help.
– Is it a fact that the Local Committee connected with the forestry laboratory in Western Australia, which has done such good work in experimenting in the manufacture of paper from Western Australian woods, has resigned, the Government having failed to carry our, the promise made two or three years ago in regard to the institution?
– The Local Committee has resigned. The original intention was to establish a laboratory for the investigation of forest products, equipped with the necessary staff and appliances; but to carry out the scheme in its entirety would, I think, speaking from memory, mean an initial outlay of something like £60,000, and a heavy annual expenditure for some years. This year, at all events, the Government cannot find the money needed. I acknowledge with gratitude the work already done by a staff having a comparatively small equipment.
– Was not a large part of the money which has been spent provided by the newspaper proprietors of Australia ?
– A considerable sum was subscribed by them and by other persons with a view to it being determined whether newsprint could be made from hardwood pulp or from pulp in which hardwood predominated. The experiments have demonstrated that newsprint and other paper can be made from pulp in which hardwood predominates, but it has not been demonstrated yet that this can be done with commercial success. We propose to continue the experiments at Perth to ascertain definitely whether the process can be put on a commercial basis, which is as far as the fund that we have at our disposal at present will enable us to go.
– In view of the ruling of the Chairman of Committees when we were considering the Estimates last night, that the allowance paid to members of Parliament could not be discussed while a Bill which I introduced was on the notice-paper, I ask the Prime Minister if he will give the House an early opportunity to discuss that measure, and’ thus enable the whole question to be dealt with?
– I shall be glad to afford the House an opportunity to discuss the measure, but whether it will he early or late must depend on members themselves. The business of the country must be carried on, and it is not suggested that the parliamentary allowance is a matter of the first moment, and that its consideration should displace everything else. I will give an opportunity for the discussion of the matter and a decision upon it.
– May I, Mr. Speaker, ask the permission of the House to withdraw the Bill?
– The second reading of the Bill having been made an Order of the Day, the honorable member cannot ask leave ‘to withdraw the measure, bub he may move that the Order of the Day be read and discharged.
– Then I do that.
Order of the Day read and discharged.
CONSTITUTION AMENDMENT BILL.
– Seeing that the Convention Bill, the first reading of which was moved the other day, is meeting with such opposition throughout the Commonwealth, will the Prime Minister drop it, and resort to the ordinary constitutional procedure for the submission of amendments?
– I am rather astonished that the Bill has not met with a better reception. The manner in which it has been received affords a striking illustration of the futility of endeavouring to please everybody. There is in the Bill something to suit every one; but apparently it contains other provisions which no one wants, and my guiding star was evidently under an eclipse when it was drafted. I shall spend the week-end chanting “Lead, Kindly Light,” so that on Tuesday I may bo able to indicate the apparently very necessary emendations which are required to give the measure even a sporting chance in this Chamber. I was very much discouraged when the Whip told me that he could not find anybody atall in f avour of the measure, because it is usual to learn that at least a few stray persons will support a proposal. Honorable members may regard me as a dinner at the penitent form. I shall do the best I can with the measure.
– Last night the Prime Minister was understood to say that he had no private secretary, and the misconception seems to be abroad that I was an applicant for the position. By way of personal explanation, I wish to inform the House that I have had no idea of applying. But if the Prime Minister is unable to obtain a Treasurer from among the members of his party, I shall be willing to accept the office temporarily until he is able to find some one else to fill it.
– I draw your attention, Mr. Speaker, to a statement in this morning’s Age, which, in my opinion, contains a most grave and improper reflection on this Parliament, and is a breach of the privileges of the House.
– I have not seen the article to which the honorable member refers, but I shall take the first opportunity that offers to peruse it.
Mr. FENTON (for Mr. BLAKELEY’ asked the Prime Minister, upon notice -
Will he favorably reconsider the pension allowed to Mr. Henry Lawson, with a view to increasing same?,
Bill returned from the Senate without amendment.
In Committee of Supply (Consideration resumed from 24th November, vide page 13253) :
Prime Minister’s Department
Divisions 24 to 27a, inclusive, postponed.
Department of the Treasury.
Proposed vote £1,207,280.
– Is it the pleasure of the Committee that the Department be taken as a whole?
Honorable Members. - Hear, hear!
. -I move -
That ‘the proposed vote be reduced by £100,000, such total reduction to be made by the Treasurer on such i tenia and sub-items and in such manner as he Shall deem consistent with economical and efficient administration.
Last year the amount voted was £1,109,000. The Estimates for this year represent an increase of £97,000. With a view to reducing the Estimates to the same amount as that voted last year, I *m proposing to strike off a round sum 6f & 100,000. Ex-Treasurers who have spoken during the debate have insisted that the only way in which economy can be effectively secured is by the Minister in charge of a Department, and especially the Treasurer, closely scrutinizing all outgoings, and paring wherever possible. For honorable members to indicate specific items in which economies can be effected, and insist upon their reduction, is impracticable, because of our lack of knowledge of the detailed work of the Departments. Every honorable member will agree that, in a Department like the Treasury, it is impossible to place one’s finger on the exact spot where expenditure can be reduced. With regard to practically all the Departments it is my intention to attempt to bring about a reduction of the Estimates, by, in effect, rationing the Departments, and insisting upon their being conducted within the Unfit thus set. I shall indicate, in connexion with each Department, where increases have occurred, and probable opportunities for economy, but this matter of control of expenditure is essentially one for the departmental heads. Therefore, I shall not attempt to state in detail where the economies that are necessary shall be effected. All the exTreasurers who have spoken on these Estimates, and also the British Chancellor of the Exchequer, and the Governments of New Zealand and South Africa, have insisted that economies shall be carried out by the Departments themselves, and Departmental Committees have been appointed to indicate where the economies can be most satisfactorily made. In a British Treasury circular, issued to the heads of the Departments, that duty is deliberately thrown upon the Departments themselves -
It is recognised that it will be impossible to carry out the degree of economy demanded by the financial situation and still preserve all the existing services carried on by the State. Therefore, the Treasury circular, with the authority of the Cabinet behind it, instructs each Department to take into consideration the abolition of some of the services under its control, even though these services represent functions imposed by Statute. Where it is necessary to obtain parliamentary sanction by means of a Bill to the abolition of any existing services the Government will do so.
That is the British Government’s method of dealing with the problem of economy, and I respectfully suggest that, following upon any reduction which the Committee may agree to at my suggestion, economies should be effected, not solely in respect of ordinary expenditure, but also in respect of statutory expenditure, if it is found that the statutory obligations are not more urgent and pressing than the ordinary ones. Before dealing with the actual estimates for the Treasury Department itself, I desire to make a few observations in regard to the Public Service generally. Those remarks seem to me to be especially appropriate at this point by reason of the fact that theTreasurer is the Minister who really controls the expenditure in all Departments. The ex-Treasurer (Sir Joseph Cook), when speaking on these Estimates, said that the man to carry out economy was the Treasurer, and I am now placing before his successor, whoever he may be, means by which reductions in expenditure can be effected.The two things I desire to emphasize are, firstly, overtime in the Public Service, and, secondly, temporary assistance. According to a statement supplied to me by the Prime Minister last week, the payment for overtime in the Departments of the Prime Minister, Home and Territories, AttorneyGeneral, Works and Railways, Treasury, Trade and Customs (including Health), Postmaster-General, War Service Homes Commission, Repatriation, and Commonwealth Railways, amounted to £85,000, and in the Departments of the Navy, Naval Works, and Defence, £20,204. The hours at present worked by the Commonwealth PublicService are from 9 a.m. until 4.30 p.m. on week-days, and from 9 a.m. until 12 noon on Saturdays. Those hours are less than most of the State civil servants are working, and I suggest that in the present grave condition of the national finances much of the expenditure at present incurred in respect of overtime might very easily be avoided by an extention of the hours of the Commonwealth Public Service from 9 a.m. until 5 p.m. onweek-days, and from 9 a.m. until 12.30 p.m. on Saturdays.
– Would the honorable member suggest a reduction of salaries also?
– I have not suggested that. But if the 23,000 public servantsworked an extra half-hour per day it would save in overtime, at the rate of 2s. per hour, which, I think, is below the rate actually paid, £340,000 per annum. Payment for overtime and temporary assistance to that amount could be avoided.
– Overtime is paid only in the General Division, which works fortyeight hours per week. Clerical officers work less.
– Even if the increase in hours meant a saving of only £100,000, it would be an economy that was well worth while, and would impose no hardship on the Public Service as a whole. The ordinary clerks in. private employment work until 5 p.m., and many of them until 6 p.m., and I know from my own professional experience that it is possible to work longer hours than our public servants are engaged at present without seriously jeopar- dizing one’s health, to put it mildly. For temporary assistance in the Departments of the Prime Minister, Home and Territories, Attorney-General, Works and Railways, Treasury, Trade and Customs, Postmaster-General, War Service Homes Commission, Repatriation, and Commonwealth Railways, the cost each year is £728,000, and in the Departments of the Navy, Naval Works, and Defence, including war service activities, £456,110, making a total of £1,200,000.
– The honorable member objected last night to making the temporary officers permanent.
– I shall deal with that in a moment. The honorable member seems to know everything about every subject under the sun. I have never known any honorable member to rise to discuss anything without the honorable member for Illawarra making some sneering allusion to him. Whatever the honorable member may think, I submit that the working of an extra half-hour per day, which would mean only an extra three hours per week, would materially lessen the necessity for the employment of temporary assistance. Apart from that, the use of temporary employees, qua temporary employees, is a wasteful method of handling public work. The Public Service Act provides that a temporary assistant shall be employed for only six months, and then an interval of another six months must elapse before he can be <re-engaged. Certainly extensions of time are made under certain conditions, but I have been told by one who is intimately associated with the working of the Departments that the system is wasteful and inefficient. In the Postmaster-General’s, Department, for instance, a letter carrier is temporarily employed. He is in the Department for three months before he becomes quite au fait with his work. For the next three months he fully earns his salary, but it is then necessary to get rid of him and appoint another man. It would be better to devise some system by which the Public Service Commissioner could declare what should be the proper proportion of permanent employees in a Department, and adhere to that as closely as possible. This is a matter that might well be considered at a time like the present; when everybody who has the good of the country at heart is looking for some means whereby the national expenditure can be brought within the limits of the national income.
Having dealt with those general principles, I turn now to the Department of the Treasury itself, with the intention of making, some comparisons between the expenditure that has taken place in different years. To be absolutely fair to the Department, I am comparing years in which the amount of work done was practically the same. Various subDepartments of the Treasury show an increase in the number of permanent employees. In 1913-14, the number of permanent employees in the Treasury itself, including the Accountant’s and Correspondence Branches, was 51. This number has gradually increased to 63 in 1916-17, to 78 in 1918-19, and to 87 in the present year. The salaries paid to these employees have increased from £10,271 in 1913-14 to £12,482 in 1916-17, to £14,000 in 191S-19, and to £21,300 last year. This year it is estimated that £25,500 will be spent on salaries for these officers. The War Gratuity Branch is a new section of the Treasury, in which 37 permanent officers are employed, drawing £8,576. In sub-Treasuries, the number of permanent employees last year was 39, drawing £9,156. This year it is estimated there will be 37 permanent employees, drawing £10,167. I would like to know whether these employees are effecting a saving on the general cost o*f administration, or whether there has been a corresponding reduction in the cost of other Departments which previously carried on the work these sub-Treasuries are doing in the various States.
– The establishment of these sub-Treasuries is merely an added convenience in the ‘various capital cities, enabling business to be facilitated.
– The amount spent on contingencies last year was £29,236. This -year the amount asked for is £21,000. I shall have a word to say upon this subject later on. The Invalid and Old-age Pensions Branch of the Treasury seems to be easily the best administered section in the Treasury, ac. cording to the figures supplied. In 1913- 14, the n amber of permanent employees was SS, and the cost of administration was £44,992, the number of pensioners being 104,000. In 1920-21, the number of permanent employees was 137, and the cost of administration £72,000, the number of pensioners being 140,000. The increase is fairly proportionate. The experience of honorable members of the work of this branch of the Treasury is such as to justify the remark that if the administration of war pensions had been carried out as efficiently, returned soldiers, maimed soldiers and the public generally would have been very much more satisfied. In the interests of economy, I suggest that steps should be taken to make available for the administration of war pensions the old organization which has had so many years’ experience of ‘ administering pensions. Necessarily, as time goes on, the number of war pensioners must decrease. The cost of administering maternity allowances has remained pretty well the same over a number of years. In the Taxation Department, however, the number of permanent employees has increased considerably since 1913-14, and so has the cost of administration. In 1913-14, there were 172 permanent employees, and the cost of administration was £75,000. In 1916- 17, the permanent employees numbered 637, and the cost of administration was £197,000, the number of income taxpayers in that year being 216,000. In 1918-19, the number of permanent employees was1,049, while the cost of administration was £308,000, the number of income taxpayers being 388,000. Last year there were 1,656 permanent employees, and the cost of administration was £511,000. This year provision is made for 2,027 permanent employees, and for an expenditure of £546,000 upon administration; while it is calculated that the number of income taxpayers is 434,000.
– The proper test of the cost of administering a taxation Department is the proportion it bears to the amount of revenue to be dealt with.
– I think that a better test would be the relative proportion the cost of administration would bear to the number of taxpayers.
– That is always a consideration; but the first test is the percentage of the cost of collection to the amount collected.
– I cannot understand why the cost of administering the office should have almost doubled since 1918- 19, although the number of income taxpayers has only increased in the same period by 46,000. I shall possibly be told that the increase in the number of permanent employees is due to the fact that certain temporary employees have been made permanent, and this, as I have already indicated, is a course that, I think, should be followed if there is opportunity of utilizing those permanent employees for any definite length of time; but not only is the number of permanent employees greater than it was, the total cost of the administration of the Department, which must necessarily include the payment of temporary employees, has gone up enormously in the last three years. I would like now to deal with the question of contingencies, which it is estimated will amount to £151,000 in the Taxation Department this year, as against £209,000 in 1919- 20, and £260,000 in the following year. I would like an explanation as to why it is estimated that the amount will be so much less this year.
– The honorable member will probably find that it is due tothe transfer of temporary employees to the permanent staff.
– If that is the case, I am in accord with the policy, so long as it can be shown that the future of the Department warrants the continued employment of such a large number of men. I urge upon the Government the points I have raised in connexion with the increased hours that I think should be worked by public servants, and the advisability of altering the Act, or, if the Act can be stretched to enable it to be done, the adoption of a different policy by the Public Service Commissioner, to permit of more efficiency being secured from temporary employees. I impress the necessity which has been indorsed on all sides for having the collection of State and Federal taxation amalgamated under one head and one set of officials.
– That has already been accomplished in Western Australia.
– I am pleased to hear it, because the cost of collection must be materially reduced by the unification of the collecting agencies. I would like to know whether the Taxation Commission proposes to submit a report dealing with that aspect of the matter. In conclusion, it seems to me that there is no justification for spending this year £100,000 in excess of last year’s expenditure.
.- Notwithstanding the fact that, many honorable members do not agree with some of the recommendations put forward by the honorable member for Cowper (Dr. Earle Page), the honorable member must be congratulated upon having contributed to the deliberations of this Committee the true kind of Supply debate. His analysis of the Department of the Treasury, with which I have some acquaintance, has erred in some respects, but, broadly, his theory that a saving of £100,000 may be expected may be practicable. I admit that it is late in the year to start to effect such a saving, because there is only, at the most, seven months during which it could operate; but I believe the honorable member has placed his finger on some items that, with a little more careful and microscopic handling, could reflect substantial savings. I do not agree with the honorable member’s criticism of the administration of the Department. If every Department was as efficiently administered by its official staff as the Treasury is, there would be little grumbling in this Committee.
– The honorable member has himself held the position of Treasurer.
– Notwithstanding that fact, what I have said is perfectly true. The honorable member is extremely anxious to hold that position, and, if some day by tragic mischance his desire may be achieved, school-boys, by using the same methods which he himself employs, may be criticising him. Irrespective of the honorable gentlemen who have held office as Treasurer- and we have had a great number of them during the war, Mr. Andrew Fisher, Mr. Higgs, Mr. Poynton, Lord Forrest, Sir Joseph Cook, and myself - and regardless of the parties to which they have ‘belonged, I venture to say, from a study of the methods adopted, that the Treasury has always been the well-ordered and well-administered Department which I believe it is to-day.
– In my opinion, it is not the only one which is well administered.
– Of course, the honorable member’s opinion always carries, in a certain sense, enormous weight. I would like to direct the attention of the Minister in charge of the Estimates to the question of the Treasurer’s Advance, which was voted in the first temporary Supply Bill of the- year, as is always done and which now stands at £1,500,000. We cannot alter that proposed vote at this stage, because it has been affected by the first temporary Supply granted, but I suggest to the Prime Minister that when the new Treasurer is appointed he should ask him, with his responsible officers, to consider whether it should not be put back to £1,000,000. It stood in the neighbourhood of that amount before the big requirements of the war demanded a larger emergency provision; but we are now getting back to normality. One effect of such a reduction of the Treasurer’s Advance would be to speed up and render more efficient certain financial phases of government. Take, for example, what is done at the present time in the first quarter of the financial year. The Works and Buildings Estimates are sometimes passed far more speedily than they were passed by the Committee this year; but the Treasurer can never rely upon their being passed and assented to, as a separate Bill, before November. All the com mitted works which are in progress when the financial year opens have thus, if Ministers agree, to be carried on by means of the Treasurer’s Advance. If the introduction and passing of the Works Estimates is to be delayed a large Advance to the Treasurer is required; but if this Committee of Supply said, in effect, to the Treasurer, “ We think that an Advance of £1,000,000 is sufficient,” he would be forced to speed up the presentation of his Budget and the introduction of his Estimates, and we should be able to come to a study of the finances in the first quarter of the year. That, I think, is a desideratum which this Committee would not only welcome, but should, as far as possible, insist upon. As a means of putting a shorter leg-rope, shall I say, on the Treasury and the Departments which lean upon it, as well as upon this particular Advance under it, I suggest the reduction of that Advance to £1,000,000 on next year’s Estimates.
– It is not a leg-rope, but a halter that the honorable member wants.
– No; it is the application of a rope to the south end - the application of a leg-rope - that I suggest.
– But the Treasury cow does not kick much when one is milking it.
– Sometimes it does. Apparently, the honorable member has been trying to milk the Treasury cow; I have not. What we have been trying to do is to slightly restrict its feed so that the milk that will be available for the purposes of government will be slightly less than before. During the war it was impossible to do what I am ‘ suggesting should now be done. The Treasury could not have carried through the war operations on an Advance limited to £1,000,000. It frequently had to anticipate by expenditure the raising of loan moneys. It had to finance the handling of large quantities of raw products. In one year the provision specially made by the Treasurer with th« banks was for £75,000,000. That was apart altogether from loan or revenue requirements, and was intended merely to finance the Wool, Wheat, Butter, and other Pools which were essential to our producing and exchanging community and equally essential to the war requirements of the1 Empire. We are not doing that now in the same way as hefore. Our loan issues are smaller, and, in my judgment, as one who has handled the Treasurer’s Advance for a good many years, I think the Treasury could safely be conditioned in the way I have suggested by limiting the Treasurer’s Advance to £1,000,000. That would promote, not only economy, but earlier and better business methods as between the Treasury and the Committee of Supply, which, I think, is vital.
Coming to the question of taxation I am afraid that the Leader of the Country party (Dr. Earle Page) in the use of the figures quoted by him has scarcely been just either to the Government or to the Taxation branch of the Treasury. It is idle to quote the cost of collection in 1913-14. The only direct taxation we then had was the land tax, and its collection at that time had become largely automatic. Then came the period when we imposed for the first time an income tax, and later on a probate tax and an amusement tax. These direct taxes were lifted, in some cases, by three stages. We then superimposed on them a war-time profits ‘tax, which, of all the direct methods of raising revenue employed during the war, is one of the most difficult to administer.
– It is no longer operating.
– It terminated by special enactment, I think, in June, 1920, but the work relating to it is still being cleaned up.
– And the employees are still there.
– The work is there for them to do, because with the exception of the war-time profits tax, which has still to be cleared up, all these taxes continue to operate. In the rush of building the Department and securing revenue by means of swift assessments a great many arrears had to be left to be gone over leisurely, and I have no doubt that some of them still remain. I had occasion recently to animadvert on the figures of the Treasurer in regard to the huge arrears of direct taxation. They relate chiefly to income tax, and we were told by Sir Joseph Cook that, because of lean years, there had been a remission of immediate payments. In addition to those arrears, which have to be dealt with, there have yet to be made a large number of adjustments in connexion with income tax and land tax, including those bearing on Crown leaseholds, and upon the war-time profits tax, and until those are cleared up the Department cannot get back to normal conditions. In the rush of building the Department it is probable that it has not been possible to organize the staff on the most scientific basis. I do not say that with any desire to reflect on the departmental heads of the Treasury or the Taxation branch. I still hold that both branches of the Treasury are well conducted, but I believe that when a little more time for leisure comes to the taxation authorities it would be well for the whole question of staff requirements to” be thoroughly re-examined. The aim of all taxation systems that are wisely administered is to cut down to the lowest possible figure the cost of collection. Neither I nor any other honorable member can say without careful examination of the figures what it costs to collect the Commonwealth income tax/ the war-, time profits tax, or the land tax.
– Customs taxation is the cheapest of all to collect.
– Undoubtedly. As another great statesman who pre-dated the honorable member - I refer to Earl Chatham - said on a memorable occasion, Customs taxation is the cheapest of all systems, and it gives you the maximum number of feathers for the minimum number of squeals. That is one of the advantages of indirect taxation. The people, when purchasing goods over the counter, forget that they are paying taxation in respect of them. I was dealing, however, with direct taxation. If it be found on examination that after some years of effective organization our’ cost of collecting the income tax is about 5 per cent., whereas I think it should run in the region of 4 per cent., then we ought to depress that cost by all means in our power, because we desire to obtain the fullest possible yield for the purposes of government for which we impose taxation.
Although qualifying some of the statements made by the Leader of the Country party, I intend, on broad lines, to support the amendment moved by him, because I believe that even now, apart altogether from a reduction of the Trea- surer’s Advancewhich ought to come as soon as possible - the Treasurer will be able to effect a saving of £100,000 in the various branches of his big Department.
.- I should like to put very briefly my view of the case advanced by the Leader of the Country party (Dr. Earle Page). In the first place, the impression I gather from his remarks is that he and his party are prepared to indulge in a ruthless campaign of cutting down, not only the personnel, but the salaries, of the Public Service, while at the same time they would lengthen its working hours.
– No, I have not mentioned salaries.
– I have no desire to misrepresent the honorable member; but I am surely entitled to place on record my impression of his remarks. There can be no other logical deduction from his speech than that at which I have arrived. Take the question of the lengthening of hours. An extension of hours means a reduction in the earning capacity of the individual. In other words, if the hours be extended a public servant will have to work for a longer period than before to provide himself and his family with the ordinary comforts of life.
– But this applies to public servants who are on salaries.
– The argument still applies. If a man by working, say, six hours per day can earn £300 per year, and he is required to work seven hours per day for the same salary, his earning capacity is thus reduced. I say quite definitely that I am opposed to any increase in the hours of the Public Service. A man cannot be expected to give efficient service if he is required to work long hours, under artificial light, in an office. Some of the public offices are not only ill-lighted, but ill-ventilated.
– It would be scandal for this Parliament to permit such a tiling if it knew of it.
– The honorable member, as a medical man, knows that it is injurious to health to be called upon to work for long hours in an artificial light.
– What does the honorable member call “ long hours “ ?
– The public servants of the Commonwealth are working fair and reasonable hours. We find ‘ that the clerical staffs of the big insurance com panies, banking, institutions, shipping companies, and various other financial and mercantile institutions have even better conditions and work shorter hours than do the clerical staff of the Commonwealth Service. Honorable members opposite show by their demeanour what their intentions are in this regard. They are out on a ruthless campaign to dismiss public servants and reduce salaries. In that they will get no assistance from me, but rather all the opposition I can offer them.
– Does the honorable member believe in overstaffing?
– No, and I do not think the Commonwealth Service is overstaffed. Let the honorable member show where it is. It is all very well for an honorable’ member to propose in a light and airy way that these Estimates shall b£ reduced by £100,000, leaving it to the Treasury officials to effect that huge reduction. There is only one class of public servant by whom such a reduction will be felt. It will be applied to the “ under dog.” Temporary employees, who can least afford it, will be the chief sufferers. Men who with their wives and families are constantly living on the bread line will be hit the hardest.
– And many of these temporary employees are returned soldiers.
– The great majority of the men who will be affected by this reduction, if it is carried, are returned soldiers. I am opposed to the reduction, and believe that every member of our party will resist it just as strongly as I do.
I want now to deal with another matter which comes under the administration of the Department of the Treasury. I refer to invalid pensions. There, are injustices being done to-day in the administration of the invalid branch of the Pensions Department that ought not to be allowed. For instance, an invalid child is refused a pension if the average earnings per head of the family exceed £1 per week’; and we can well imagine what may happen under such a rule. Parents, actuated by their natural love, are more closely drawn, perhaps, to an invalid child than to the strong and healthy members of the household, and desire to give it all the care for which its condition calls. But while the parents are actuated by the highest motives they are deprived of the assistance “which the country has provided, and to that extent penalized if the average family earnings exceed the sum mentioned. Of course, it parents choose to be inhuman, and throw their invalid child into the streets, to face all the hardships of the. world, the Department steps in and provides a pension. I know of several cases such as I have described, and I have no doubt that the experience of other honorable members is the same as my own. An invalid child necessarily requires medical attention and frequently expensive medicines, together with constant care; and I sincerely hope that this matter will be looked into with a view to a much desired reform.
The administration of the War Pensions Department also requires attention. One of the greatest mistakes that was ever made by this Parliament was to take away the administration from the existing Old-age and Invalid Pensions Department, and create a special Department. When all pensions were managed by the one Department we had efficient and sympathetic administration. All credit must be given to the officers of the Invalid and Old-age Pensions Department for the manner in which their work is done. They- have grown up with the system, and, with the advantage of many years of experience, naturally display that temperament so necessary in dealing with disabled soldiers. A little touch of sympathy after all does a great’ deal to smooth down the difficulties of life, and under the old arrangement all was well. But the moment that the War Pensions Department was created complaints arose, and have continued, of the unsympathetic’ and harsh treatment of our soldiers. Indeed, such complaints are only to be expected, seeing that the officials have been trained, most of them, in an atmosphere of war, where there is too much of the “mailed fist” business, and the giving of orders that no nian dare question. That does not suggest the proper method of dealing with our disabled soldiers. The administration of war pensions should be once more handed over to the Invalid and Old-age Pensions Department, and this is a suggestion that ought to appeal to the members of the Country party, for, if carried out, it will prevent duplication of effort, and result in con- siderable saving of money. The new Department has been the cause of endless annoyance to soldiers and their dependants; and, therefore, I hope that the Government may shortly be able to announce that this and other reforms I have advocated are to be carried into effect.
– The amendment amounts to a declaration that the Estimates shall be reduced by £100,000, and the Government left to carry the reduction into effect. More responsibility, however, devolves on those who support such an amendment- than the mere passing of it in Committee. It is their duty to indicate, perhaps not the exact sums, but the particular item or items in regard to which they feel that the expenditure is excessive. These Estimates have been carefully prepared, not only in regard to this, but every other Department, and they have been cut down to the lowest amount at which it is considered the Departments can economically and efficiently carry on the services. Particularly do these remarks apply to the Treasury Department, now under discussion. Let us look at the Estimates and endeavour to find where, if anywhere, they could be reduced by £100,000. For the Central administration £55,630 is appropriated for this year - a decrease of £5,509 as compared with 1920-21.
– The Government estimated that this Department could be carried on with £46,000.
– It was so estimated, but I can justify the increase. In the case of the Commonwealth Stores Supply and Tender Board there is a decrease of £3,430; Invalid and Old-age Pensions Office, for which £87,035 is appropriated, shows a slight increase of £2,019; the Maternity Allowance Office, for which £15,758 is appropriated, shows a decrease of £144; and the Taxation Office, for which £546,127 is appropriated, an increase of £34,755. Then follow the other votes, including £449,084 for miscellaneous expenditure.
– The miscellaneous vote requires some explanation.
– And the explanation is perfectly clear. If honorable members will turn to the detailed expenditure under the miscellaneous heading they will find that, roughly speaking, some £360,000 of the £449,084 is interest on transferred properties, in regard to which we cannot make any reduction whatever.
– Why is that item set down under “miscellaneous”?
– That is the way in which the expenditure has always been classified. Then there is the £75,000 for the maintenance of persons admitted to charitable institutions and hospitals in accordance with the provisions of the Invalid and Old-age Pensions Acts. As honorable members know, when a pensioner goes into a public institution he receives his pension for twenty-eight days, but if he remains longer his pension is withheld, and 10s. 6d. a week paid to the institution for his maintenance. How could any reduction be made in such an item, any more than in that which refers to the transferred properties ?
– It would save much time if a series of explanatory notes were attached to the Estimates.
– The miscellaneous items explain themselves. The expenditure in connexion with the coinage cannot be reduced, because (that is a revenue-producing branch of the Service. The £26,651 for the Government Printer is for absolute services rendered, and cannot be curtailed; neither can we interfere with the Maternity Allowance Office, nor with the Old-age Pensions Office. Every one admits that the latter Department is most efficiently administered, and that no reduction can be made in the expenditure of £87,035. It is therefore evident that if there is to be a reduction of £100,000 it must be in connexion with the taxation office.
– And the Treasury.
– The expenditure on the administration of the Treasury is only £55,000 for the whole of the Commonwealth, so that it would be impossible to take £100,000 off that item. The criticism seems to have centred on the Taxation Office. Many figures have been quoted for past years, and an endeavour made to apply them, by way of comparison, to present conditions. We must bear in mind that the Commonwealth has advanced very much since 1913-14, and if the expansion of the country is not reflected in the expansion of the Departments to meet the needs of the community we have stagnation, and not economy.
– Why should the expenditure be nearly doubled in two years?
– I shall give the reason presently. When figures for 1913-14 are quoted I ask whether any business man, newspaper proprietor, or any other person conducts his affairs to-day on exactly the same standard as he did seven or eight years ago? Wages, materials, and services are all more costly than they were.
– Would not a fair comparison be one between the cost of collecting the Commonwealth taxation’ in Victoria and the cost of collecting the State taxation here?
– All comparisons depend for their fairness on the similarity of the factors. The task of collecting the revenue in a State of a small area is different from that of collecting the revenue for the whole Commonwealth. The following table, as supplied to the Royal Commission on Taxation, shows the cost of making the net revenue assessment and! the amount of the net revenue assessed in the year 1919-20: -
– That is for the whole Commonwealth ?
– Yes. The aggregate amount paid in salaries may seem large, but the cost is only a small percentage for the amount collected, which shows that the management of the Department is economical and efficient. If the vote were reduced by £100,000, and the staff cut down, less revenue would be collected, and probably the Commonwealth would lose some millions.
– A good deal is outstanding now.
– Do honorable members wish to increase the amount of uncollected revenue?
– How would the proposed reduction do that?
– If there is not a sufficient staff to send out returns, and to collect the money, we cannot get in the revenue.
– You mean that a large number of taxation officers must be dismissed.
– Certainly, if Parliament does not provide the money with which to pay them. The Victorian branch of the Department was overhauled by the Economies Commission, whose report on it was by no means unfavorable.
– The officials in Melbourne are housed like pigs.
– Their accommodation is a scandal to the Commonwealth, and we have been trying for some time to get it improved.
– It is marvellous that the officials are able to do their work in the circumstances.
– In 1920-21 the staff of permanent officers numbered 1,656, and their salaries came to £277,164. This year it is proposed to have a permanent staff of 2,027, at a cost of £394,407. This increase in the number of permanent officers is due to the making of permanent appointments to the positions now occupied by 371 temporary officers, whose salaries amount to £117,243. I think it will be generally agreed that if any. officials should be permanent it is those who have access to the confidential information contained in the income tax returns of the citizens. This House is responsible for much of the increase in the cost of the Government Departments through its approval of the basic wage and the child endowment.
– The Prime Minister and the Government must take their responsibility for that.
– The Government is willing to accept its share of it, hut Parliament must also accept its share. The adoption of the basic wage and the child endowment has increased the cost of this Department by £9,932, and the automatic increments to officials by £11,402.
– Have you taken into consideration the savings made in respect of employees who do not get the full benefit of the basic wage and the child endowment?
– I am dealing now only with the actual net increases. The amalgamation of our Western Australian branch with the State Taxation Department has led to an increase of £21,598, and the reclassification of positions, and the appointment of new senior officers to an increase of £10,544. These increases total £53,476. The vote for contingencies has been reduced by £12,069.
The Commonwealth has power, and is anxious to amalgamate its Taxation Department with those of the States, to secure economy and uniformity in operation, and in returns. This is difficult by reason of the differences between Commonwealth and State Acts. In Western Australia, however, the Commonwealth Department is collecting both the Commonwealth and State taxes. Only one return has to be filled in by the taxpayers there, on which they are assessed for both Commonwealth and State taxation. The expenditure of the Commonwealth Department in Western Australia in 1920-21 was £42,995, and the cost of the State Department in that year was £33,367, the two Departments costing £76,362. This year the amalgamated Departments are estimated to cost £65,986. That agreement has resulted in saving the people of the Commonwealth and Western Australia a sum of £10,376 19s. 8d. The Commonwealth bears the whole ‘of the cost of collection, and the State repays one-third of its own former cost. Honorable members say that they do not wish to indicate where economies can be effected, but the Government cannot escape that responsibility. Ministers have carefully gone through eyery one of these items, and I have indicated to the Committee that this proposed saving of £100,000 is absolutely impossible. If the amendment is carried, effect to it can be given only at the cost of getting rid of officers, and that will prevent the proper collection of revenue.
– It will mean a loss of revenue.
– It will possibly mean aloss of revenue to the amount of some millions of pounds. The honorable member for Cowper (Dr. Earle Page) referred also to temporary employment. That matter should have been discussed in connexion with the Prime Minister’s
Department, which controls the Public Service Commissioner. Temporary employment cannot be abolished. According to the last report of the Public Service Commissioner, 11,000 of the temporary employees are exempt officers. These men are to all intents and purposes permanent, but in the interests of the Service they are exempt from certain provisions of the Act. They are not temporary men who are put on and off at will. Practically the whole of the employees in the Naval Works Department are temporary, and I, as the Minister in charge, will not suggest that they should bo made permanent. Formonths past I have been reducing staff, for the reason that we are not proceeding with many of the proposed naval works, and as other jobs are completed, the men are paid off.
– Yet the estimated expenditure shows an increase !
– As regards naval works, there is no increase in expenditure. In very many of the branches work must be carried out by temporary men, because the work itself is temporary, and in the circumstances it would be monstrous to pile up an immense staff of permanent men. I think the principle upon which the Commissioner is acting is that, when the work to which an officer is temporarily appointed is found to be permanent in its nature, the office is created a permanent one. The sooner a man is permanently appointed in those circumstances the better. Not only do we get the wider field of selection for the filling of permanent offices, but we get more efficient work from a man who has some sense of security. I remind the Committee that much of the work done by the Postal Department, such as the erection of telegraph and telephone lines, varies in quantity from time to time, and, therefore, must be carried out by temporary employees. Office cleaners in the Departments are temporary.
– Are not the men employed on the Murray River Waters scheme temporary men?
– They are casual employees; but they are employed by the States. Some of the professional staff on those works consist of men appointed merely to carry on the job during construction. The employment of a large number of temporary hands is unavoid able, and it is not true economy to suggest that such officers be made permanent. I ask the Committee to reject the amendment. These Estimates have been most carefully checked, and I submit that, on the whole, the Department of the Treasury has presented economical and well-balanced proposals.
.- The Minister in charge of these Estimates has thrown upon the mover of the amendment the responsibility of indicating the detailed items in respect of. which economy can be practised. My Leader indicated very clearly where savings are possible. The honorable member for Balaclava (Mr. Watt), who is an ex-Treasurer, expressed the opinion that £100,000 can be saved, and I shall be guided largely by what he said, because, having an inner knowledge of the Department, he does not rashly suggest a reduction that cannot possibly be effected. If a reduction is possible I shall vote for it. One could indicate many ways in which economy can be achieved, but the onus is upon the Minister in charge of the Department to show beyond question that the increases proposed are necessary. The bulk of these figures have been drawn up by officers of the Department, and there is a general tendency to justify their proposals. I know, from a quarter of a century’s experience in the management of an office, that immediately payment for overtime is introduced loafing takes place during the day. I found that the best method was to define hours of work, require the officers to observe those hours rigidly, allow no overtime, and close the office punctually at the regular hour. It is thus possible to allocate the work in such a way that the staff will be reasonably occupied throughout the day.
– Then some honorable member will ask for a return to be prepared, and an office staff is required to work overtime to furnish it.
– There is too much of that, and I think that economy could be effected by reducing our printing, and throwing less waste paper about this building. We were told by the Minister, and also by the ex-Treasurer (Sir Joseph Cook), thatall that is possible in the way of a reduction of expenditure has been done, but within the last few days the impossible has been accomplished.
– With what result?
– I think that the reductions which have been made will have an excellent effect. The Committee should realize thata very big section of this community is obliged to carry on with an income that is 50 per cent., and possibly 75 per cent., below that of last year, and the national revenue from ordinary sources will, perforce of circumstances, be reduced.
– Most of the money provided in these Estimates is for the employment of persons to do certain duties.
– It is possible for the Government to reduce the expenditure in connexion with taxation which the Minister laboured so much. I thoroughly agree with the principle of amalgamating Federal and State Taxation Departments throughout the Commonwealth. A commonsenseand economical arrangement would be to have only one authority collecting from the same set of people, and the Government of Western Australia have made an arrangement with the Federal authorities by which taxation for both State and Federal purposes is collected on the basis of the one return. But, as a taxpayer in that State, I remind the Committee that the endeavour to meet Federal and State requirements on the one form has led to that form becoming so complicated and confusing that the taxpayer is required to pay 50 per cent. more for professional advice in connexion with the preparation of his return.
– Does the honorable member suggest that the States should make their laws of taxation the same as those of the Commonwealth?
– It should be quite simple to arrange by legislation to put the taxation on a uniform basis. The items of divergence are not considerable. For instance, the Western Australian Taxation Authority has one system of valuing live stock, and the Federal Authority hasa different system.
– Is the Western Australian system the same as that in each of the other States ?
– Probably all the States have different systems. The difference of opinion between the Federal and State authorities in Western Australia do not mean twopence halfpenny more or less to the collections, but, nevertheless, they are persisted in. Why cannot the two authorities come to some uniform arrangement in regard to the allowance to be made for children ? I am sure that it is possible, without any surrender of revenue, to avoid the harassing differences which cost the taxpayer such a lot of money in connexion with the preparation of his return. A man may have to pay only £2 or £3 in taxation, and yet the making out of his return may cost him £12.
– As regards stock, the agreement with Western Australia provides that where the Federal law is substantially identical with that of the State, the Federal law shall prevail. The Western Australian law is practically identical with that of the Commonwealth, and therefore the Federal law prevails.
– I may inform the Minister that I have hardly cooled down since making out a double return under the unified system in operation in Western Australia, owing to the different methods of valuing live stock. In the circumstances I cannot be persuaded that the information the Minister has given is correct.
– I can only give the honorable member the information supplied to me by the Commissioner of Taxation.
– Well, I have not had my assessment yet, but I know that I was obliged to pay an official to prepare my returns in a certain form. If the Commissioner is given authority to avoid that double work on the part of the taxpayer it would be of advantage to the public to let the fact be generally known. It would have saved many people the cost of preparing their returns on the lines I have indicated.
-Provision is made for all that in the agreement with the State.
– The agreement has notbeen made known to the public in its entirety. There is also the item of patriotic gifts, in regard to which the State and Federal authorities differ. Deductions under this heading would not be considerable, and I think it is a matter that could easily be adjusted with the States. If taxpayers had to supply only one return of income they would avoid a good deal of expenditure now incurred in having to keep two sets ofbooks. Freedom from harassing conditions would also be a great consideration. Again, in the matter of land taxation, there are varying systems of valuation. The methods adopted are the most devious and expensive that could be employed. Necessity is the mother of invention. While the exchequer is open for expenditure on the scale that prevailed in more prosperous times, there will always be a hurden hanging to the people of Australia. I have had a long experience of official work, and, although I do not believe in long hours, I think that honest work should be rendered by those who are employed by the State for the salary paid. Over-staffing always leads to expensive administration. Whenever there is any resort to the system of temporary employment, it is remarkable how the permanent employees loaf upon temporary employees. Ministers who are in proper touch with their Departments ought to be in a position to estimate the number of employees required to do the amount of work to be done. I have seen the evil effects of any departure from that system. It leads to wastefulness and inefficiency. A great deal has been said about reducing the wages paid in the Federal Service. Speaking for myself, I believe in giving good pay for efficient service; but I hold that a man should deliver the goods. I am totally opposed to keeping in the Public Service, or anywhere else, men who are not required. The Economy Commission has told us that in one case there were too many men in one branch of the Service, but that as nobody wished- to report the fact, or get rid of them, a system of requiring the initialing of papers which were passed from one to another was inaugurated, and deceived outsiders into believing that each man was busily employed. Loafing in the Service re-acts upon every section of the community. Every man who is not earning his money is putting a burden on the rest of the people. There is no escape from this .position. If the circumstances of the war have brought about changes in all countries, involving a little shifting about and stirring up of nests, it behoves us to fearlessly accept the responsibility of looking closely into our public Departments, and while paying men properly to do the work we expect of them, taking ©are that we do not employ more than are necessary to do that work. The services of men who are not legitimately required should not be retained. There is any amount of work available for them outside the Service. Spending money in the employment of more men than are necessary to do a certain amount of work is the surest way of creating unemployment. I want the introduction of a more up-to-date system into the Public Service. The Government should not lose any time in getting into touch with the Governments of the States with regard to the question of taxation unification and the amalgamation of the statistical work and electoral rolls, because economy can certainly be effected in these directions. For the reasons I have advanced I shall vote for the amendment.
.- The difficulty of the Committee in regard to the amendment submitted by the Leader of the Country party (Dr. Earle Page) is that the proposed reduction is not made applicable to any particular item, but is to apply to the total vote for the Department of the Treasury, which covers, among other things, expenditure on the administration of invalid and old-age pensions and the maternity allowance. Those honorable members who support the amendment should indicate where they propose to save this £100,000.
– Do you not think that the Government is extravagant?
– We on this side of the chamber have done something effective to bring about economy. As a result of the initiative we took in regard to the Defence Estimates, the Government intimated that, while a full reduction of £500,000 for which we asked could not be made, it was intended to effect savings to the extent of £430,000 on the Defence Estimates.
– And it will be £500,000 before we have finished with those Estimates.
– That was effective work, and there is some justification for honorable members assuming the attitude we took up, but there is none for the attitude of those who come along and suggest a saving without indicating how it can be brought about, except by cutting down the wages of public servants. That is- the only stand that has been taken up by some honorable members in the Country party, except that the honorable member for Indi (Mr. Robert Cook) says that he would out down the maternity allowance. Is that what honorable members of the Country party intend ?
– The maternity allowance cannot be cut down as a result of carrying the amendment. It is paid under a special Act.
– I hesitate to take very much notice of the. tactics of honorable members of the Country party. Yesterday their leader moved several amendments, but when the Prime Minister came in, and used a little of his customary bluff, the honorable member retired.
– Yes, in cricketing language, he retired hurt, although the Prime Minister’s explanation was simply his usual bit of hedging. Are the Country party simply out to get a little more of that limelight of which the press are giving them so much today? The proposal they have put forward this morning will amount to nothing. An action which had some result was that taken by the Labour party in regard to the Defence Estimates for additions, new works, and buildings.
I am not satisfied with the amount provided under Division 36 (Miscellaneous), £449,084. I would rather see the total split up into separate headings. If the amount set against any particular item in this division remains unexpended there will be nothing to prevent the transfer of the unexpended balance to another item in the division.
– That could not be done.
– The expenditure is all set out in items. It is hardly possible that there will be unexpended money available for transfer from any item.
– Under the heading of “ Miscellaneous,” Item 1 covers interest on transferred properties, and Item 2 provides for the maintenance of persons admitted to charitable institutions and hospitals in accordance with the provision of the Invalid and Old-age Pensions Acts. I would rather see these items put in separate subdivisions, because if the amount opposite one item is not wholly spent there will be nothing to prevent the transfer of the balance to another item.
– Theoretically that is true of all the Estimates, but any such trans action is subjected to the closest scrutiny, and is reported on by the AuditorGeneral.
– What the honorable member for Hume suggests should be done would make no difference. The Treasurer could still spend the money.
– That is what I say. There is nothing to prevent the. transfer of an unexpended balance from one item of a division to another in the same division. I think that these items should be treated as separate subdivisions.
– But the Treasurer could still do what the honorable member suggests can be done.
– Possibly, but this Committeewould have done its duty by endeavouring to prevent it.
Sitting suspended from 1 to 2.15 p.m.
– Under the heading “ Miscellaneous,” there is an item of £75,000 having to do with payments made to hospitals. I desire to call attention once more to a long-standing injustice . When a pensioner has to enter a hospital I understand that his pension is suspended, and on discharge he is entitled to payments covering a, period of twenty-eight days. A payment of 10s. 6d. is made to the hospital authorities.
– And also a small allowance to the pensioner himself.
– But in the case of a pensioner getting 15s. per week neither the hospital nor the pensioner receives the extra 4s. 6d.
– It amounts to 2s. 6d. per week.
– Even that, in proportion to the full weekly pension of 15s., means a loss to the pensioner. The 2s. 6d. - or, as I say, the 4s. 6d. - should either go to him or to the hospital authorities. Many hospitals throughout the country are in difficulties. No hospital can maintain an inmate for 10s. 6d. a week. I presume that the weekly margin of 4s. 6d. returns to Consolidated Revenue, but I cannot see the justice of withholding the amount either from the one or the other party. I have brought this matter up more than once; the exTreasurer (Sir Joseph Cook) promised to go into it, but nothing has been done.
Instead of there being any cutting down of the pension, in any circumstances whatever, the weekly payments should be augmented.
I desire to refer now to several specific cases of injustice in respect of the payment of invalid pensions. Possibly my remarks would be more appropriate at another stage, seeing that the pensioners are returned soldiers, who receive their payments through Repatriation officials. One typical case has to do with a man who is practically totally incapacitated; but his pension, has been “ held up “ because he has been pronounced by a medical official to have sustained only one-sixth of hi3 incapacity as an outcome of warlike operations. I wonder how these officials go about ascertaining the exact fraction; it must be a nice calculation. I shall not touch upon the subject generally at this stage, however, further than to remark that when war pensions were administered by the Pensions Department there was considerably more general satisfaction. Pensioners do not receive anything like the same treatment now that the Department is a military one; and nothing like the same degree of efficiency has been maintained. One of the main causes of complaint to-day is that little practical sympathy is shown by the controlling officials.
– I would like to bring about a reduction of the Treasury Estimates, but there can be no justification for suggesting a “ bald headed “ cutting down by an exact sum of £100,000. I have been through the departmental details most carefully, and I have been unable to find reasons for anything like so drastic a reduction. When the honorable member for Balaclava (Mr. Watt) rose to address himself to the subject I thought that, in view of the honorable member’s experience in the Treasury, he would have been able to furnish the Committee with tangible, practicable suggestions. I was disappointed in that regard, however. So far as concerns the Taxation Department, I submit that honorable members should read the Estimates in the light of the statements made by the ex-Treasurer (Sir Joseph Cook) when delivering his Budget Speech. Consideration should be given, at the same time, to the very clear and detailed report furnished «by the
Taxation Commissioner, at the express behest of the Treasurer, who desired to ascertain the reason for the considerable increases of staff. The information fur.nished was overwhelmingly convincing. Although there had been considerable increases in the number of employees, it was pointed out that the revenue secured as an outcome of the investigations of the augmented staffs was relatively far greater, and, certainly, a matter of much more importance to the country. The ex-Treasurer said., further, that the task of recovering amounts due from taxpayers, and of securing new revenue from others who had never been previously drawn upon, was one which had been long overdue, and which had not yet been anything like completely overtaken. Sir Joseph Cook added that, large as had been the increases of staff, the Department could very properly have employed still more hands. The taxpaying community may be regarded as a gold-field, and taxation officials as prospectors. If the prospectors can continue to secure such excellent proportionate results as during the past financial year, the cost of employing the augmented numbers will surely have justified itself.
– But should the heavy overhead charges be permitted to mount higher and higher?
– The Federal Taxation Department should be regarded in the light of a relatively new activity. It cannot yet be judged from the same stand-point as the longestablished State Departments. No doubt, a normal position will have been reached eventually; and then, perhaps, the proportion of overhead costs to returns will have been reduced to the lowest practicable working limits. As for the employment of temporary hands, that is a factor which applies throughout the Commonwealth Public Service. The Public Service Commissioner has been devoting close attention to the matter for some time, and has got more temporary employees transferred to permanent staffs during the past year than ever before: But there is still a great deal of temporary work to be done in the various Departments, and there must, therefore, be a correspondingly large number of casual employees. That holds good, especially so far as concerns the Taxation Department. When the Federal Department shall have become normally established - .’and thus comparable with the various State Departments - the amount of temporary labour, no doubt, will have been markedly reduced. But even the State Taxation Departments are compelled to temporarily add to their staffs, often to the extent of 25 per cent, during rush periods of the financial year. The Leader of the Country party would surely not have men now temporarily employed placed on the permanent staff? As soon as the rush of work is over they have to go. I come now to the question of overlapping. I heard the references made by the honorable member for Swan (Mr. Prowse) to the result of the amalgamation of the Taxation Departments of the Commonwealth and Western Australia, but I advise him to wait a little before he approves of it as a matter of economy.
– I merely said that I approved of the principle.
– Western Australia has given the other States a lead, but I do not take such a rosy view of such an amalgamation as do some of its advocates. Even if I were a representative of Western Australia I would not give a verdict now as to whether it is going to be a complete success, or will give satisfaction to the people of that State. I agree that there should be uniform taxation returns for both the Commonwealth and the States.
– But the incidence of taxation is different.
– The honorable member is always considering trifling details. The differences in the incidence of taxation represent only a few thousand pounds. There are bigger con’siderations. The honorable member spoke about stock valuations. The slight difference in the principle of assessment in regard to live stock could easily be rectified, and a considerable saving would be effected by having one form of return for State and Federal taxation. In addition, the public would be convenienced.
– It was agreed at a conference of the taxation experts that that should be done, but the Commonwealth backed out.
– It did not.
– The Commonwealth was, at all events, a little at fault. Uniform taxation forms should have been agreed to at the time referred to by the honorable member for Dampier (Mr. Gregory). Such a reform would be an especial blessing to country people, and I hope that it will soon be brought about. In regard to land tax valuations-
– Is the honorable member agreeable to what I have suggested ?
– My honorable and brilliant friend is again behind the times. What he has urged was advocated in this House long before he came here. It is a disgrace to both the Commonwealth and State Parliaments that an understanding has not been arrived at in regard to the subject, which is eminently within the province of the States, and not of the Commonwealth. It is a matter, not merely of collecting the tax on a proper basis, but of securing uniform valuations. There should be one central Board responsible for the valuations that have to be made for taxation purposes by the Federal and State Governments, as well as by the municipal and district councils. So far as the taxation of pastoral areas in the dry interior of Australia is concerned, I venture to assert that the land tax collected from such sources does not pay the cost of valuing and collecting. There should be co-ordination of effort.
– Is the honorable member advocating a stiffer tax
– I am not.
– The honorable member has urged that the revenue received from the taxation of pastoral areas in the interior does not pay the cost of collection.
– But there is another alternative, and that is to exempt from Federal land tax the areas in the interior where there is practically no rainfall. If the Leader of the Country party would withdraw his motion to reduce the Estimates by £100,000, and would propose a reasonable reduction, I should be delighted to vote with him, if only to force on the attention of the Department the directions in which a real saving can be effected, and the taxpayers at the same time relieved of much anxiety.
– I do not believe in making a wholesale onslaught upon the’ Estimates of any one Department. To do so is to commit a grievous, blunder. There are times when even the expenditure on the Public Service can be increased with benefit to the revenue of the country. When the Federal land tax was first imposed the Commissioner had to rely for the time being on municipal valuations, some of which were very erratic. After the experience of a year or two, he came to the conclusion that he was not obtaining anything like the revenue that ought to be forthcoming, and he took steps to appoint competent valuers, with the reult that the land tax revenue was increased to the extent of hundreds of thousands of pounds.
– Each taxpayer was made his own valuer.
– As a rule, the taxpayer adopted the municipal valuations, which in many cases are very erratic.
– The municipal, State, and Federal valuers all differ.
– That is so. There should be one staff of valuers for Commonwealth, State, and municipal purposes. If competent men were obtained, the one staff would be able to do the whole of the work, and considerable savings would thus be made. The appointment of special valuers for Federal land tax purposes proved to be well justified.
It is possible to cut down the Public Service to a point at which it would become inefficient, and there could be no greater curse than an inefficient Service. A contented, well paid, and good working Service, on the other hand, is a blessing. I am not one of those who believe in indiscriminate cutting down. It would appear that in this State history is likely to repeat itself. We are now experiencing the aftermath of the war, and we have to-day certain individuals raising the very cry that was raised in this State ofter the collapse of the land boom. To the best of my ability, I represent all sections of the community in my electorate. I seek election on certain definite principles, and if my programme were faithfully carried out, I believe it would b: to the benefit of the whole community.
– Is that your own programme?
– I am speaking of the programme of my party, though there may be additions which are gratefully received by the electors whose suffrages I seek. As I was saying, there is apparently the same spirit abroad that was observed after the collapse of the land boom, when the State Government, in their first attempt to rectify matters, imposed a special retrenchment tax on the railway and other public servants. I was then in the State Government employ, and I objected then, as I object now, to any section being selected for special taxation while the rest of the community, whatever their ability to pay, escape. I was then in receipt of wages or salary of so much per month, and my tax came to £13 or £14 per year, which I had to pay in addition to municipal rates and all the’ usual State taxation. There were thousands of men in Victoria more able than myself to pay additional taxation, but they escaped; and it can safely be said that the railway and other public servants did more to relieve the financial stress of the State than did any other section of the citizens. I paid that special tax for two years, at the end of which I received the ominous intimation; - although I had been promoted just three months previously - that, owing to the imperative necessity for retrenchment, my services would not be required after a certain date. I had thought my position permanent, and had devoted my savings to providing a house for myself and my family, so that I had nothing in my pocket when I was thrown out “neck and crop.” Thousands were served in the same way.
– That relieved you from paying the special tax !
– I was thrown out, not on the cold charity of the world, but on a labour market overloaded with unemployed. Thousands, like myself, had to “ scratch “ for a living, and my period of “scratching” lasted nearly ten years. The Commonwealth ought to take care to avoid disasters such as fell on the great mass of the people of this State at that time. Nearly every private employer took his cue from the action of the Government, and there were dismissals wholesale. Such a policy did no good, and never can do good to a country; but the same spirit prevails in certain quarters to-day, and I wish to prevent its spread. We are told that we must produce and produce; but how can that be done if unemployment is created ? A policy of that kind is not economy, but simply miserable and contemptible parsimony - the word “economy” is out of place when so applied.. At the outset, I would say, “ Hands off the Public Service !” If the public servants’ wages are reduced, State
Governments, and then private employers, will follow the example, and the last state of affairs will be worse than the first.
– Is Victoria in a worse position than any other State?
-I do not say so for a moment;I am optimistic enough to believe that, with the schemes already afoot, Victoria, in the next ten years, will show greater progress than any other State of the Union.
I regret that the honorable member for Balaclava (Mr. Watt) is not present, because I wished to quote some neat and picturesque language he used when he was Treasurer of this State. No one will accuse that honorable member, either in State or Federal administration, of being a reckles or ruthless person in regard to finance. He had, however, to defend himself against his critics, and he declared that it was impossible for a man to go to the Treasury and conduct the public finances of the country in the same way as a private individual conducts his affairs. It is absolutely essential for a Government to take a certain amount of risk if a country is to be developed. If some of our legislative pioneers had been nervous mortals, trembling on the brink of every scheme for development, Australia would never have advanced; but, fortunately, they were bold men, prepared to take risks, and succeeding generations enjoy the results of their courage. Are we to be afraid to make a move, when we feel sure it will ultimately result in benefit to the community? The honorable member for Balaclava (Mr. Watt), when State Treasurer, also said that there were numbers of people in Victoria who mistook “ a zephyr for a hurricane “ ; and there are such people abroad to-day.
– The honorable member can speak on any aide, and we now find him the apologist of the Government.
– Except as to the Tariff!
– I think I am fairly consistent on the Tariff, and I am an apologist for no Government. The language used at that time by the honorable member for Balaclava expressed only the absolute truth. Not speaking disparagingly of proper caution, it may be safely said that it is not the nervous people in business who make headway: and it is the same with a Government or Parliament.
Of course, there are items in the Estimates which may be investigated with a view to saving money, but i do not believe that saving can be effected by simply extending the hours and reducing the pay of public servants. My usual practice is to come into the city by the 9 o’clock train in the morning, and I find the carriages filled, not by public servants, but by men employed in banks, insurance offices, and similar business places. This leads one to the conclusion that the office hours of those men do not begin until 9.30 o’clock, and why should not the public servants enjoy the same hours as are the rule in other employments?
– Such as the business of the primary producer.
– I was, early in life, and I now am, connected with the business of primaryproduction, and though my hours do not run exactly from “ jackass to jackass,” I have a fairly strenuous time. Those employed by me work eight hours a day at good wages; but I place myself in a different category, knowing that all I do goes to improving the property that is mine. I do not, of course, expect those who work for me to do so with the same amount of interest, and for the same length of time, as I do myself. I have had considerable experience amongst farmers, particularly in the dairying industry, in my efforts to promote the co-operative movement, and, whether those men work long hours or short, they, like myself, know they are improving their properties.
– They are building up assets for themselves.
– That isso.
– The land is not always their own property.
– But if a man does own the property, every bit of work he does enhances its value. Anyhow, if I had to work long hours, I would sooner work in the open air than indoors.
– If the climate is not too wet or cold!
– We have to take the weather that comes; in any case, the wet and the cold are as essential as the warmth to the man on the land ; we must take the shadow with the sunshine, and the winter with the summer.
– What about the poor unfortunate farm labourers?
– I was about to mention the men employed on the permanent way of the railways, who have to work all the time, in all kinds of weather. Work of various kinds is often done to timetable; and, though we hear talk of the “ Government stroke,” if a public servant does indulge in it, his services are very soon dispensed with. A man who gets into a public Department is not necessarily there for life. .
– He generally hangs on, anyhow !
– Such positions are not absolutely secure, as my own experience proves. It is not only as a public man that I have been able to do a good turn for a public servant. On one occasion, after some men had been retrenched, and the officials were disregarding their claims in making new appointments, I went to the right honorable member for Balaclava, and put the case before him. He said, “ I will not allow such an injustice,” and those on whose behalf I intervened were appointed.
We could save a considerable amount of money, and greatly convenience the public and the officials, if we provided in each of the capitals suitable offices. At the present time the Commonwealth spends annually about £104,747 in the renting of office accommodation. This is not accommodation that would subsequently have to be provided at Canberra, where the central administration of the Departments will eventually be removed, but accommodation which will always be required in the capitals, and my view is that we should do better by erecting buildings for our offices than by continuing to rent “office space.
– The officials of the Taxation Department are abominably housed in Melbourne.
– I know that; and the accommodation in the Old-age Pensions office in Sydney is disgraceful, too; the authorities should be prosecuted under the State Factories Act because of it. But if we were to borrow £1.500,000 at 6 per cent., the interest would be less than what we now pay in rent throughout Australia, and we could erect in each of the State capitals in convenient situations offices whore the Departments would be concentrated. This would convenience public men, the ordinary citizen who has business with the Departments, and the officials themselves. At present much time is wasted in running from office to office in the big cities. My suggestion is a money-saving proposition. Something on these lines is being proposed for Sydney, but the Government should introduce a comprehensive office building scheme which would take in all the capitals. Such a scheme would, I think have the support of honorable members. I cannot vote for the amendment of the Leader of the Country party (Dr. Earle Page), because I do not believe in dismissing employees haphazard. The honorable member, notwithstanding the publicity that “he has achieved, is not the only reformer; in every political party members wish to do the best for the whole body of taxpayers of which they are units. I am prepared to vote for definite economies, but not to thoughtlessly and hurriedly reduce proposals, leaving it to the Government to take action. As the Minister has shown, that means wholesale dismissals, and the rendering of Departments inefficient, so that the country really loses much more than it saves.
.- The last few addresses have been in the nature of second-reading speeches on a measure of taxation reform, which is not the subject now under consideration. We are, of course, justified in urging the Government to arrange with the State Governments for an amalgamation of the Taxing Departments of Australia, which would effect simplicity and. produce economy. We badly need uniformity in matters of taxation, whether the collecting authority be the Commonwealth or the State. That, however, is a matter to be dealt with later. In my opinion, the Government is responsible for the position in which we find ourselves to-day. The Commonwealth and State Taxation Commissioners met in Conference, and came to an agreement, which was submitted to this Parliament and printed as a paper. But the Government departed from it in introducing an amending Income Tax Assessment Bill, especially in connexion with the proposal to tax at the source. I do not say that the Government . was not justified in ignoring the agreement if Ministers thought wise to do so, but they must take the responsibility for the result of such action. The people realize that we must have economy, and our Ministers might pay special attention to a speech on the subject recently delivered by the Prime Minister of New Zealand. They must recognise that throughout the world efforts are being made to reduce taxation to relieve the community of the heavy burden which it is now carrying. There are honorable members who say that we should not reduce the number of our officers, and that the Government should find work for those who have nothing to do in the Service, but I assure Ministers that they alone will be held responsible if the public burden is not lightened. Proposals must come later to provide employment on reproductive works. The party to which I belong will hold the Government responsible unless the Ministers do their best to carry out the promise of the Prime Minister that there shall bc reasonable economy. He has said that these Estimates will be cut down by £250,000, and we should like Ministers to help us in reducing them still further. The Minister for Works and Railways said that it is impossible to reduce by £100,000 the vote now under consideration, and I should like to know by how much it can be reduced. We have no desire to embarrass the Government, but we are determined to have economy, either with or without the Government’s assistance.
I do not cast any reflection on the Commissioner of Taxation, who has to administer the Acts passed by this Parliament, when I say that our taxation laws are giving work to a large number of accountants and specialists in the making up of income tax returns. I know of instances in which taxpayers have saved thousands of pounds by going to these specialists in regard to their assessments. When you compare the administration of the Federal with that of the State Taxation Departments you find that our system requires the employment of very many more men than the other. From inquiries which I made some time ago, when a proposal to build offices in Sydney for the Taxation Department was being investigated, I learned that in the Federal Taxation Office in Sydney there were f>30 officials, and in the State Taxation Office only 130 officials. New South
Wales does not levy a land tax over a large area, but our officials, on the other hand, have to deal only with land held in blocks worth £5,000 or_ more. In Victoria there are 440 Commonwealth taxation officials and 169 .State taxation officials. Both sets of officials collect income tax and land tax, but the business of collecting land tax is a much bigger thing under the- Victorian law than under the Commonwealth law, because, as I have said, only land of the value of £5,000 and upwards is subject to Commonwealth taxation, whereas under the Victorian law all land is taxed. As a matter of fact, the State office employs 64 officials in the col- lection of income tax, and 66 in the collection of land tax, the balance of the 169, I suppose, being temporary officers. I am not reflecting upon the Commissioners, but a.m urging the need for greater simplicity in connexion with the collection of ta.xa.tion. A mistake was made in the early stages of our income taxation in not adopting the suggestion for taxing the dividends of companies at the source. If that had been done the Commissioner would be receiving taxation from the companies direct, instead of having to follow the dividends to the individual shareholders. By collecting at the source a big saving could have been effected.
– Does the honorable- member approve of the system of taxation at the source?
– It is by far the better system, but I do not wish to discuss its merits to-day.
– The honorable member’s comparison in regard to the taxation staffs in New South Wales is hardly just. The Commonwealth office in that State deals with 240,000 assessments as against from 40,000 to 70,000 dealt with by the State Department.
– I know that the taxation per head in New South Wales is much higher than it is in Victoria, and it is remarkable if less people are assessed in the former State.
– In 1920-21 the Commonwealth assessed 243,000 persons in New South Wales, and 189,000 in Victoria.
– Is the exemption allowed by the State much higher in New South Wales than in Victoria ?
– It is £250, and higher than in any of the other States.
– That may be the explanation of the figures I have quoted. In regard to the Treasury Estimates generally, the Prime Minister (Mr. Hughes) said some weeks ago that a. sum. of £837,000, lying to the credit of the Commonwealth in London, and representing repayments for the maintenance of Australian troops on garrison duty in occupied territories, would he credited to revenue. The Committee should be given same indication as to whether the Government intend to do that, because undoubtedly that is an amount which should be recouped to loan account. I cannot understand why the Committee should be asked to believe that this amount should be credited to revenue, when it is merely a. recoup of moneys expended from loan funds. Some time ago I referred to the evasion of taxation by a certain oil firm, and I hope we shall have a promise that some inquiry will be made into this case. According to information, which has been furnished to me, the Government have lost in this way from £2,500,000 to £3,000,000 in taxation revenue. A special effort should have been made to bring the company concerned within the purview of our taxation. The Vacuum Oil Company, which, I understand, . does about onethird of the oil business in Australia, has paid very large sums in taxation, but the British Imperial Oil Company, which is doing the remaining two-thirds of the business, has paid no taxation. The manager of the British Imperial Oil Company stated in evidence before the InterState Commission that its operations in Australia had resulted in a loss. This company is one of the subsidiary companies connected with the Royal Dutch Company, which has a capital of £12,150,000, and the Shell Transport Company, which has a capital of £111,880,000. Those twoare combined in what is known as the Royal Dutch Shell Group.
– Where is the AngloPersian Company?
– It is not connected with this Combine. These companies are making enormous profits. The papers in my possession show that whilst it may have been possible for the British Imperial Oil Company to charge such special rates for the conveyance of oil to Australia as to make it appear that it was trading at a loss, yet the Royal Dutch
Company and the Shell Transport Company, which control the other, have made enormous profits.
– Is the honorable member suggesting that certain revenue, which has not been collected, should have been collected ?
– This information was conveyed to the Government some time ago by the British Empire Union, which wrote to the Prime Minister and to Sir Robert Garran pointing out that apparently Australia was being defrauded by the special rates being charged by the parent company for the transport of oil to Australia, and for the oil itself. It is clear to me that there is something wrong in the non-payment of taxation by the British Imperial Oil Company, because the Vacuum Oil Company has been paying large sums in income tax to the Commonwealth. It is remarkable if the other company, which does two-thirds of the Australian business and obtains its supplies from a nearer source, is trading at a. loss. Surely this is a matter which should have received the most careful investigation by the Government.
– The honorable member forgets that the Government have made a deal with the Anglo- Persian Oil Company.
– That company is not in the same group.
– All the others are dominated by the Anglo-Persian Oil Company.
– I can find no trace of that association.
– I am informed that this matter has been thoroughly investigated, and is still receiving the attention of the Department.
– But no attempt has been made to amend the Act, notwithstanding that this matter was brought prominently under the notice of the Government about 1915. Surely the Government cannot excuse themselves by saying that they are still investigating the matter.
– The honorable member will find that this matter was brought under the notice of the Government at a much later date than 1915, and immediate steps were taken to investigate it.
– In any case a long time has elapsed since the matter first came under the notice of the Government. In 1915 the Vacuum Oil Company of
Australia declared a profit of £4.02,000, and in 1816 £579,520. In 1915 the British Imperial Oil Company declared. a loss (vide Inter-State Commission’s Report, 1918).
– It seems clear that the British Imperial Company has cleverly manipulated its figures to avoid, taxation, and no attempt has been made by the Government to amend the Act.
– I have not the time to-day to go into this matter in detail, but we should receive an assurance from the Government that the House will be given an opportunity to discuss the question. When drafting amendments to the Income Tax Assessment Act, I hope’ that some provision will be made to deal with this case. The Commissioner of Taxation has fairly wide powers in relation to returns which he does not think are correct, but we should endeavour to insure that no company doing an enormous trade in Australia shall be able to avoid paying taxation whilst other companies engaged in the same business are paying taxation. I shall defer further reference to this matter to a later date. I again impress upon the Government that honorable members of the Country party are determined to see that due economies are effected in the Department, and in that endeavour I hope we shall receive the assistance of the Government.
.- Many honorable members seem to hold the opinion that the cutting down of this vote must necessarily mean retrenchment and the dismissal of public servants, but, to my mind, granting less money to a. Department to spend should not’ necessarily mean the dismissal of men. There are many Departments of our Service where, a great deal of saving could be effected by the adoption of business methods. The honorable member for Dampier (Mr. Gregory) has lamented the fact that throughout Australia a large number of accountants and others earn the greater portion of their incomes by preparing taxation returns, and advising business people, if not how to evade taxation, at any rate, how they can escape their liabilities by paying as little as possible, whilst still keeping within the letter of the law and the regulations. What the honorable member has said is perfectly true, but the regrettable feature is the fact that a large percentage of the men to whom the honorable member has referred received their training “in the Taxation Department. Our sympathy should be extended to those officers of the Department who have taken the trouble to train these men in taxation methods, only to lose their services when they become really of value- Possibly, these men resign because they are not paid decent salaries.
As many honora’ble members have said, from time to time, no effort should be spared to bring about uniformity in taxation matters. Unfortunately, the decision does not lie with this Parliament, and this desired result can only be brought about by agreement with the various States. However, when such matters come up for discussion between the States and the Commonwealth, or perhaps when the capitation payments to the States comes up for review, an arrangement might be entered into whereby a clean line of demarcation may be drawn between the field for Federal taxation and the -field for State taxation. The Federal land tax was imposed with the avowed object of breaking up large estates, but it would be a great advantage to taxation principles if the privilege of taxing land values were reserved for the States, the Commonwealth seeking its revenue from direct taxation on incomes and from other sources. In order to illustrate what I am saying, I propose to refer now to the speech delivered by Mr. Allan, the managing director of Allan and Stark Limited, one of the largest softgoods firms in Brisbane, at the last general meeting of shareholders. Mr. Allan said, referring to a building scheme -
One of the objects of my recent visit to Europe and America was to obtain the latest ideas in warehouse buildings and general layout, and a fall report has been recorded. Under present conditions, with numerous dividing walls and limited areas, business is greatly hampered. Many departments could be extended if we had more room and better lighting, but ‘before we begin such a hig job, full and complete plans must be ready, and we must know exactly how we stand from start to finish. It is intended to get further information, and by the time this is completed the money market may be easier. The essential steps’ are: (1) Preparing plans, complete to the smallest detail; (2) finding the capital required, and no great difficulty is anticipated in this respect; (3) assembling building materials - rolled steel and concrete; (4) a definite assurance that a full supply of highly skilled labour will be available to complete the work in the shortest time possible.
The above details can be adjusted by mutual agreement, but the greatest difficulty can only be removed by legislative action. This difficulty is the State and Federal land tax. The following figures are startling, but absolutely correct (shillings and pence, or small decimals are omitted, also tax presently paid on leaseholds) : -
The land taxes payable at present to State and Federal Governments are -
On the higher scale of taxation, if these small separate properties were added, the scale would work out -
The total area of land to be dealt with is 41,538 square feet, or less than 1 acre. The taxation on this area would then be over 7¾ per cent. (7.83) of its value unimproved. Taking the present value of money at 6½ per cent., and capitalizing the annual tax of £6,173 at 6½ per cent., the amount is £94,976. This simply means that, directly or indirectly, we musthave £94,976 invested to return6½ per cent. on property valued at £78,810. Put in another way, this prohibitive taxation works out as an annual charge of£36 per foot frontage in Queen-street, and over £10 per foot frontage in Adelaide-street.
Land tax was primarily passed to burst up huge areas of unimproved estates held for speculation.Every inch of the area referred to is fully built on, and the effect of the tax applied to this city property is toburst up all hops of city improvement at an expenditure of between £300,000 and £400,000 in wages and materials. A tax on income is just, but a land tax as shown is simply a rack-rent, which must take precedence of dividends, and the collection of which diminishes State revenue from income earned. It also places an embargo on financing, as those who invest the savings of the people will not advance to the usual extent on securities so heavily handicapped. Difficulties were made to be overcome, and this special artificial difficulty can only be met by all interested - employers and wage earners - giving the matter serious consideration, and using their combined influence in removing a glaring injustice.
I make no apology for detaining the Committee by laying this case before the Government. I hope that at an early date an arrangement will be made between the States and the Commonwealth to simplify the present cumbersome method of taxation, and also avoid the dual control now in existence.
.- The ex-Treasurer, in delivering his Budget speech, dealt with the question of taxation reform. I contend that this Parliament should regard taxation, not solely from the point of view of what revenue it is likely to bring it, but also from the view-point of how it affects the country. It is all very well for the Taxation Commissioner to submit a report to Parliament, claiming that he has collected a great deal more money this year than he did last year, using the fact as a justification for his claim that he has been doing good work. We certainly should derive from those earning profits in Australia sufficient revenue to enable us to administer the affairs of the Commonwealth, but at the same time we should always bear in mind the fact that the more money we can leave in the pockets of those engaged in industry, the greater the benefit to Australia as a whole. At this stage I have no desire to traverse the Government’s taxation proposals, but I want to draw attention to one or two phases of them. One proposal which will need consideration at a very early date is that relating to the taxation of the dividends of co-operative societies, and to the double taxation of the members of those societies, a matter which has already been referred to by the Deputy Leader of the Opposition (Mr. Charlton). If a number of people combine in a genuine cooperative effort for their mutual benefit, no Government, State or Federal, should endeavour to take from them something which rightly belongs to them as a result of their industry.
– It is nothing but double taxation.
– It is double taxation. I am pleased with the proposal for the appointment of an Appeal Board to which any taxpayer dissatisfied with his assessment may appeal. This should relieve the minds of many people who believe that they do not get fail’ treatment from the Taxation Department. I have had an opportunity of seeing the State and Federal Taxation Departments working together as one body, but the result of this combination is as yet in the air. There is not a great deal of trouble involved in filling in the ordinary taxpayer’s return for Mie State of “Western Australia, but I have been informed that the schedule required to be prepared by a business firm is exceedingly complicated. Surely, with the associated brains of the State and Federal authorities, some simplified form could be compiled, so that the average business man might be able to furnish necessary particulars without the present amount of trouble and loss of time. There are organizations and individuals scattered throughout Australia who have set themselves up to assist harassed taxpayers in formulating their schedules. Some of these bodies and persons, no doubt, are all right; but there are others who are practically extracting money from the general public under false pretences. .The opportunities of these gentry would be cut off altogether if a simplified taxation paper were devised. I regret to say that almost incalculable harm is being occasioned to the mining industry owing to the attentions of taxation officials. I shall quote several specific cases. One of these has to do with an old prospector named Charles Bartlow, who _has been fossicking on the island, Lake Austin, for twenty -five years. He has been scratching up a few ounces here and there, but little or no success had attended his efforts until lately, when he had the good fortune to obtain gold to the value of about £7,500. Now he has been assessed by the State and Federal Taxation Departments to the extraordinary extent of £4,200. Honorable members say that Mr. Bartlow is fortunate to find himself in the position of being called upon to pay so much; but it should not be forgotten that the sum of £7,500 virtually represents the whole of the man’s savings in a life-time of endeavour. Do not honorable members think that an unwarrantably heavy levy has been made by the taxation officials ?
– Their demands are ridiculous.
– I appeal to the Government to give fair consideration to all such cases as these.
– The ex-Treasurer (Sir Joseph Cook) intimated that the law would be amended to afford relief in respect of persons engaged in mining ventures other than coal mining. That, of course, would cover the activities of prospectors.
– I am glad to hear that legislation is likely to be introduced- before long to that end. In the neighbourhood of the old worked-out mines, practically throughout Australia, there are sand-dumps. When they were originally placed there the cyanidization process was scarcely known. At any rate, under the old charcoal precipitation system payable results were unobtainable. The oxidization of those dumps has now made it possible for many of them to be treated successfully. Men who have ascertained by means of assay the values contained therein are desirous of erecting treatment plants at the dumps. I have been informed of one dump which is calculated to possess a recoverable value of 30,000 fine ounces. When a plant has been erected upon a dump the party interested is assessed upon the value of that plant. But when he eventually sells his plant he gets the benefit of merely the ordinary percentage of depreciation. I suggest that a plant which has been erected for the treatment of sand-dumps should be practically exempted from taxation, or that it9 value should be gauged on the basis of the period over which it has been worked. If two years have been occupied in treating a dump, the party concerned should be taxed upon its value spread over the full period, and in the light of what has been won by its employment. Let me quote one case. A plant, valued at £1S,000, had been erected, and the process of treatment occupied five years-. Under the provisions of the Federal Taxation Act, only 25 per cent, of the value of the plant, covering the whole period, was allowed in respect of depreciation. Yet, after that dump had been treated, the plant was practically useless. The mining industry is taxed and handicapped, and in every way discouraged. I trust that before the session ends the Government will have introduced a Bill to amend the Taxation Act in order that persons who have suffered injustice and hardships may be afforded relief. I do not know what would be the state of the mining industry but for the gold bonus..
It has been asserted that only two mines in Australia would be able to carry on if the bonus were withdrawn. Unfortunately, the question of how long it may be continued does not rest with the Commonwealth, but with a portion of the Empire with which, commercially, Australians have not much in common.
Motion (by Mr. Groom) proposed -
That the House do now adjourn.
.- Some time ago a deputation representative of the whole of Tasmania waited upon the Minister for Trade and Customs (Mr. Greene) with the object of persuading the Minister to grant exemption in respect of passenger-carrying conditions to mail-boats which desired to call at Hobart during the early period of the year for the purpose of loading fruit. Rumour said that the mail vessels would not call at Hobart, for the reason that the Navigation Act did not permit them to carry passengers when trading to pick up fruit. Great loss will have been occasioned to Hobart, and to the people of Tasmania generally, if the Act operates so harshly. There are many people who look forward to taking what is known as the “apple trip”; but they will not travel by other than mail-boats. The deputation placed the whole position before the Minister. It appears that, under the Act, exemption can be granted upon certain conditions. Those conditions which apply in this instance have to do with the matter of adequacy. I do not think the Minister was satisfied that the deputation had established its contention that the service provided by Interstate steamers between the mainland and Hobart was inadequate. I want to point out to the honorable gentleman that this question of “adequacy” is both difficult and delicate, and that attempts will doubtless be made to draw subtle distinctions between what is an adequate and what is an inadequate service. I hope that the question will be carefully weighed by the Cabinet, because its decision will create a precedent that may be applied to all parts of the Commonwealth .
– The honorable member evidently admits that it is a. very difficult question to deal with.
– The determination of what, in a legal sense, is an “adequate” service might very well puzzle the best judges. It seems to me, however, that all the facts point to our contention that the present service is not quite adequate. The Peninsular and Oriental and Orient steamers cater for a class of passengers who will not travel over ordinary routes, and who, unless they could book passages by such vessels, would not go to Hobart. If« the mail boats are available, a man may travel by one of. them direct from Sydney to Hobart, remain there a month, and then board another mail boat for Melbourne, and return from Melbourne to Sydney in the same way. The Inter state- steamers do not supply that service. The question of “ adequacy,” therefore, must be’ considered in its application to those who would not go to Hobart at all unless they could secure the accommodation supplied, and follow the- route taken, by the Orient and Peninsular and Oriental steamers. In the circumstances, it cannot be said that coastal vessels are adequately supplying the requirements of the trade. At the present time, there is only one vessel, the Paloona, going direct from the mainland to Hobart, and it would be quite unable to cope with £he ordinary passenger traffic during the summer months. Apart from the effect which the cutting out of these mail vessels would have upon the trade of Hobart, surely the desire of a large body of the Australian public to travel by them is deserving of consideration. No service that leaves out of account the requirements of a large section of the people can be said to be adequate. The oversea mail steamers also carry a certain proportion of the fruit shipped from. Tasmania in the early part of the season, when special prices can be obtained on the London market for certain classes of fruit. For instance, Cox’s orange pippin apples will bring as much as 30s. a case on the London market if they can be landed there in theearly part of the year. That is a matter of importance to the fruit-growers. One of the big 50,000-ton steamers could practically take away in the one trip the whole of the apples we desire to export ; but that is not what is wanted. When the market is glutted, prices fall, and the fruit-growers suffer. The big oversea vessels have extensive insulated space, and they land our early varieties of fruit on the London market, not only in good condition, but well on time. The fruitgrowers have experienced bad times during the last five or six years. During the war period, their produce was not given priority of shipment, and they suffered many losses. They have now to pay 8s. per case for the carriage of their fruit to London, whether it be shipped by the vessels of a private company or by the Commonwealth Line of Steamers. If some consideration is not to be extended to the fruit-growers of Tasmania and other parts of the Commonwealth, one of the best, healthiest, and most interesting industries - one that will settle more people on a given area than will any other - will be destroyed. I impress upon the Minister the fact that the Peninsular and Oriental and Orient vessels supply a want that is not met by any other service, and that this must be taken into consideration in determining the question of “ adequacy.” The Minister informs me that he expects the Cabinet to give its decision on Monday next, and I certainly hope that the Government, in their wisdom., will decide that the existing service is inadequate. The Paloona, as I have said, is the only Inter-State vessel now running direct from Melbourne to Hobart, but I understand that the coastal shipping companies are accepting bookings for people desiring to travel direct from Sydney to Hobart. Something more, however, is wanted. There is no guarantee that additional coastal steamers will’ be put on the service. If this question is determined by the Cabinet on the assumption that additional facilities are to be provided, and in the end those additional facilities prove inadequate, we shall be saddled with a bad precedent. I am satisfied that the Minister wishes to treat Tasmania sympathetically, and I fully appreciate the difficulty in which he finds himself. I would not ask him to break the law, but I do hope that he and his colleagues will give the most careful consideration to the determination of this question, and arrive at a decision that will do justice to Tasmania.
– Some annoyance seems to have been expressed in Tasmania at the fact that the decision of the Government has been delayed. The only reason for the delay is that we havebeen exploring every possible avenue with a view of finding a way out of this difficulty.
– What about Albany?
– This particular question does not affect the position of Albany, although I know what is the honorable member’s difficulty in respect of that town. I want to deal first of all with this question from the point of view of the fruit-growers. At the best, there could not be more than six of these mail steamers calling at Hobart during the apple season. Of those, three under the terms of the mail contract are bound down to call there. In addition to that, we have made arrangements for the new “Bay” steamers of the Commonwealth Line to call at Hobart during the apple season. There will be three of those vessels. They are very fast - faster than the mail boats - and will provide a better service than Tasmania would have had if all six mail steamers had continued to call at Hobart.
– When is the first of the “ Bay “ steamers expected to arrive?
– The first of them will call at Hobart some time early in February next. The refrigerated tonnage of these vessels is very much greater than that of the mail steamers. As a consequence, the quantity of fruit which will be lifted from Tasmania, during the apple season, this year will probably be greater than it has ever been. Whatever happens in regard to passenger traffic, I do not think there will bo any difficulty from the fruit-growers’ point of view. I saw in the press the other day a report of a speech made in Tasmania by Sir Henry Jones, in which he said that ample freight arrangements could be made for lifting the apple crop from Tasmania. I do not think there is any doubt in that respect. In order to give weight to the argument in favour of the mail steamers calling at Hobart, the fruit-growers have been drawn into it, but as I have already pointed out, that really does not affect the position at all.
– It does, so far as some people are concerned, as I could show the honorable gentleman by reference to certain newspapers.
– I know that a great deal has been said on this question from the fruit stand-point, but the informa- tio n I have already given the Committee will show that, at the most, only three of the oversea mail steamers would be cut out, and these new “ Bay “ steamers will call.
– That was not knownwhen this agitation was commenced.
– That may be so. All I can say is that the fruit-growers will have as good a service in the existing circumstances as if the normal mail boat service were continued. I believe all the mail boats will call, but that remains to be seen. As I have already said, the question of the passenger traffic is the crux of the situation, and as honorable members know, the Navigation Act provides that no ship shall engage in the Australian coastal trade unless the owners pay the members of their crew the Australian rate of wages, and provide accommodation, and feed their men, according to the schedule to the Act. Not one of the vessels mentioned would be refused a licence if these conditions were complied with. Therefore, the real fault does not rest with the Government at all, but with the shipping companies. They say that they will not comply with the conditions of our Navigation Act, and thus we are precluded, in the circumstances, from granting them a licence.
– Would they be permitted to carry passengers from port to port in Australia if the coastal service were inadequate?
– I am coming to that point. In addition to the existing coastal steamers that are running and any additional boats the owners put in commission, as they have indicated their intention of doing, there are the “ Bay “ boats. These Bay boats, which do comply with the provisions of the Navigation Act, have ample passenger accommodation, which should satisfy the great majority of those people who may want to travel from Sydney to Hobart during the apple season, and they could also take passengers to Melbourne, later, if they desired. The Act does not allow us to grant licences to ships that do not comply with the conditions laid down in the Navigation Act. So long as we are satisfied that the coastal trade can be handled by existing vessels that are licensed, therefore it would be most unfair to issue licences to ships that do not comply with our conditions. That is the position in which the Government finds itself.
– It is a very difficult position, too.
– I have looked into the question with the utmost care, and with a desire to help Tasmania as far as I can. As I said some time ago, the matter has received some consideration from the Cabinet. The question is being given further consideration almost immediately, and I hope to announce a final decision within the next few days.
Question resolved in the affirmative.
House adjourned at 4.19 p.m.
Cite as: Australia, House of Representatives, Debates, 25 November 1921, viewed 22 October 2017, <http://historichansard.net/hofreps/1921/19211125_reps_8_98/>.