House of Representatives
20 June 1923
9th Parliament · 2nd Session
- GOVERNOR-GENERAL’S SPEECH : ADDRESS-IN-REPLY
- NEW MEMBER
- GOVERNOR-GENERAL’S SPEECH: ADDRESS-IN-REPLY
- SPECIAL ADJOURNMENT
- ADJOURNMENT
Mr. Speaker (Rt.Hon. W. A. Watt) took the chair at 2.30 p.m., and read prayers.
page 185
GOVERNOR-GENERAL’S SPEECH : ADDRESS-IN-REPLY
Censure Amendment
Debate resumed from 19th June (vide page 184), on the motion of Mr. J. Francis -
That the following Address-in-Reply to the Speech of His Excellency the GovernorGeneral be agreed to -
May it please Your Excellency :
We, the House of Representatives of the Parliament of the Commonwealth of Australia, in Parliament assembled, beg to express our loyalty to our Most Gracious Sovereign and to thank Your Excellency for the Speech which you have been pleased to address to Parliament.
Upon which Mr. Anstey had moved, by way of amendment -
That the following words be added to the proposed Address : - “We also desire to inform Your Excellency that as foreign policy reacts upon domestic policy and may be fraught with grave consequences to the self-governing institutions of our country and the welfare of our people, this House therefore declares -
That this House should develop the foreign policy Australia is prepared to support and should clearly express the foreign policy it is not prepared to sustain.
That only on such conditions should any delegate or delegates be permitted to go abroad to represent Australia; and
That on no account should the despatch of such delegation be accepted as an excuse for the suspension of the functions of selfgovernment in this country.”
Mr MAHONY:
Dalley
.- The honorable member for Bourke (Mr. Anstey) is deserving of the thanks of the community for the emphatic way in which, when submitting his censure motion, he placed Australia first. The interests of the Commonwealth have been subordinated too long to those of other parts of the Empire. It is remarkable that Australia, among all the Dominions, should be the only one whose statesmen are never tired of belittling its efforts and endeavouring to show that it is helpless and hopeless, and but for the support of the rest of the Empire would fade away into nothingness. Such a policy is never adopted by leading men in the other Dominions. The leading statesmen of Canada, South Africa, and New Zealand invariably put their own country first, and are never tired of sounding its praises. On the other hand, statesmen here lose sight of the great underlying fact that our stability and the value of our securities are determined by the value which we ourselves place upon Australia. I invite the so-called business men opposite to say how they think our securities are going to stand up against their constant attempts to belittle the country. The true position of Australia is shown by the fact that those who have money to advance have confidence in Australia. The fact that they are prepared to advance money to us at reasonable rates of interest shows clearly that, in their opinion - in the opinion of the hard-headed business men of the world - Australia is not so helpless as leading statesmen of the Commonwealth would have us believe. We have to-day a resurrection of the “ Calico Jimmy importing brigade.” which, in times gone by, declared from one end of Australia to the other that we could do nothing for ourselves, and that everything must be done for us in other parts of the world. In this glorified “ Calico Jimmy “ importing Government, which decries Australia and endeavours to show that we are helpless, we have a resurrection of the old brigade.
In the few minutes that I shall occupy this afternoon I propose to place upon record the opinions of some of the highest naval and military authorities as to the capacity of Australia to defend itself. In dealing with the defence of Australia we have to remember above all things that Australia is an island, remote from the great European centres of civilization, and far removed from any potential enemy. We have to consider the gigantic undertaking involved in transporting sufficient troops over the vast miles of ocean that separate us from any potential enemy, to say nothing of the cost of the transports themselves, the foodstuffs that would be required for the troops, and the fact that, even if those difficulties were overcome, the enemy would still have to effect a landing. The cry that Australia cannot defend itself has been held up as a nightmare to the people of this continent for many years. As far back as the days of the late Sir Henry Parkes the danger of an invasion of Australia was paraded before the people. At that time we had theRussian scare. We were told that we mustbeware of the Russians. I wonder whether, after all, history is not repeating itself to-day, and whether behind this present move is the fear of the Soviet of the people of Russia. I believe that in the background is the fear of the capitalists and ruling classes that the working classes of Australia, in common with those of the rest of the world, are prepared to go a good way along the lines set us by the people of Russia.
When the late Sir Henry Parkes first became an active advocate of Australian Federation, he obtained from an Imperial Committee a report as to the danger of Australia being invaded -
The Imperial Committee’s report was to the effect that the cost of transporting an effective military force to Australia would be so great that no foreign Power would attempt it.
This report did not suit Sir Henry Parkes, and he did not publish it; but it was made public later on by the Victorian Government of that day. Times have changed considerably since then. The late Lord Kitchener - who, I think, almost every one will admit, was in his day one of the greatest military experts the British Empire possessed - visited Australia and reported to the Commonwealth upon its defence. I shall give the House a quotation from his report, since it throws an interesting light on the question of whether or not Australia is helpless. His opinion is of far more value to the people of Australia than is that of the glorified “ calico Jimmies “ now charged with the administration of our affairs. In the statement I have before me it is set out that -
Lord Kitchener next alludes to ocean distances which separate Australia from possible enemies, the armed strength and ocean transport of the enemies; and finally the small population, vast area, and railway communications of Australia. These considerations lead him to estimate the land forces required at 80,000 fighting troops, of whom half are required to defend the larger cities and fortified points from attack, while the other half would be free to operate as a mobile force.
Mr Bamford:
– Read the rest of the report.
Mr MAHONY:
– I shall give the House the whole of it. Lord Kitchener clearly set out in his report that, with 80,000 troops, Australia could hold its own against the greatest nation that might see fit to attack it.
Mr Bamford:
– Conditionally upon Britain holding command of the seas.
Mr MAHONY:
– Nothing of the sort. I would remind the honorable member (Mr. Bamford) that it is quite within his province to remove the “ gag “ which has been applied to him, and, if he has the safety of Australia at heart, to give the House the benefit of his knowledge on the subject. If he knows something of what Lord Kitchener said it is his duty to the country to rise and tell the people of it, and I invite him to do so when I resume my seat. Lord Kitchener pointed out that Australia required 80,000 troops to resist invasion. Ofthese troops 40,000 were to form a mobile force that might be rapidly transferred from one place to another. The present Government and other decriers of Australia have always failed to realize the absolute necessity for proper Inter-State railway communication. Lord Kitchener laid it down that there should be proper railway communication provided between north and south, and east and west, and held that if that were done no country in the world could possibly take Australia. The history of the world teems with illustrations of ghastly failures where ships of war have been pitted against forts. For one illustration we need go no further than the last Great War, and the gamble at Gallipoli, which involved the massacre and loss of the precious lives of so many brave young Australians. It was clearly shown there that it is utterly impossible to successfully attack land forts from the sea. The late Lord Fisher and Admiral Sir Percy Scott have explained that whilst the guns of land forts are mounted on stationary platforms from which ranges can be accurately ascertained, the guns of a manofwar are mounted on swaying platforms, owing to the motion of the vessels, and there is considerable difficulty in ascertaining accurate ranges. At Gallipoli the guns of the Queen Elizabeth, and other. Dreadnoughts, did as much damage to the Australian troops and the troops of the Allies as they did to the Turkish troops. A few hours after abombardment of the Gallipoli forts by the Queen Elizabeth, the guns of those forts resumed their attack. In one instance the naval action had to be stopped, and the huge British Dreadnoughts were compelled to withdraw out of. range of the guns of the Turkish forts. The experience of Gallipoli clearly proved that, it is impossible for a man-of-war to successfully engage a fort equipped with serviceable guns. Some of our naval experts opposite require to read something of the naval history of the world. If they go back to the days of Lord Nelson they will find that, he laid it down that the sailor who attacks a fort is a fool. That was true in Nelson’s day, and it is just as true to-day. There is the illustration of Italy’s attack upon Tripoli. Although Tripoli was only within a few hours’ sail of Italy the Italians were faced with enormous difficulties in the conveyance of their troops, and a very fine defence was put up against them by a people who were very ill-equipped for defence. They showed how impossible it is for land forts to be effectively attacked from the sea. Admiral Henderson is another of the experts who came here to report upon the defence of Australia. I find that he was reported in a cablegram, dated 25th September, 1919, to have expressed himself in the following terms: -
Admiral Henderson believes that Australia’s great need in the present financial position is not lavish expenditure on armaments, but on the development of maritime resources in all directions, including railways to the coast, and also to increase her seafaring population by every means in her power, particularly by the promotion and encouragement of the fishing industry.
The Government of Australia, instead of doing what Admiral Henderson recommended, has adopted every means possible to prevent encouragement being given to our mercantile marine and the building up of a seafaring population in Australia. They have left the mercantile marine of this country in the hands of the people of any other country but our own. I should like here to quote one or two of the words of Admiral Lord1 Fisher. Let us see what he has to say on this important subject. On 20th October, 1919, Lord Fisher, writing- to the London Times, said -
It is as clear as daylight that the future of war at sea absolutely precludes the use of any war vessel except submarines. Therefore, why keep any of the present lot?
This shows that to defend Australia what we need is not a fleet of huge battleships, but submarines. They would be the most effective weapon of defence for Australia against attacks by any oversea power. Admiral Fisher also said -
We must also scrap all. our Admirals and superior officers who will not do for the new jobs. Put them into a museum like Greenwich Hospital,- keeping only submarines and their commanders.
The Government are not alive to presentday naval needs. They still cling to the old idea of the importance of the huge battleship, although a man like the late “ Jackie “ Fisher, who certainly knew his job so far as naval matters were concerned, laid it down that we should scrap the Admiralty superior officers and put them in a museum, because they are not fit for the new job. The members of the present Commonwealth Government should themselves follow the advice of “ Jackie “ Fisher, and retire to a museum. Here is another statement made by Lord Fisher -
I observe here that when Lord Kitchener went to. Australia to inaugurate the scheme of defence, he forgot that Australia was an island. What Australia wants to make it impregnable -is not conscription - it is submarines. However, I fancy Kitchener was sent there to get him out of the way. They wanted me to go to Australia, but I didn’t. Jellicoe has gone there. But Jellicoe has not always sufficient foresight.
That is the opinion of Admiral Fisher on the matter. If Australia carries out the programme laid down in the report by Lord ‘Jellicoe for the establishment of a naval base at Singapore, we shall be committed to an expenditure, in the first year, of £4,500,000, and in every subsequent year of over £6,000,000. And the Prime Minister is going to England to pledge this country to such an undertaking - if this Parliament allows him to go. It is as well to have these opinions placed on record, so that the virile manhood of Australia, and the people generally, may realize that they are not such a weakkneed lot of “ suckers “ as the members of the present Government would have us suppose. I wish the people of Australia to be assured on the words of the greatest naval and military experts of to,day that Australia is not only .capable, but ready at any time, to .defend herself against any power that may attack her.
I should now like to draw attention to the importance of submarines and floating and fixed mines. If, as we are told ‘by the experts of the Government, an attack by a naval force is the great danger to be feared, how is it that the British and allied navies were unable to take Zeebrugge and Ostend - why was it found impossible to force a way into Germany by means of naval attacks? The explanation is that the Germans had seen to it that the entrances to these places were properly mined, and it was not possible for any hostile force to be landed on those shores, seeing that ships of war could not get within miles of the coast-line. In this wesee the. means of protection for Australia. If Ostend and Zeebrugge could stand against the might of the British and allied navies, surely Australia can successfully contend with any enemy which it is supposed may attack us. Let me give honorable members a little more information about the Dardanelles affair, and show how a mere handful of people, by means of submarines and fixed and floating mines, defended themselves. Here is what Lord Fisher says in regard to this: -
And if the Dardanelles evidence is ever published, it will he found absolutely ludicrous how the official spokesmen gravely give evidence that the Turks had come to their last round of ammunition, and that the roofs of the houses in Constantinople were crowded with people looking for the advent of the approaching British fleet. Why, it took our admiral, on the conclusion of the Armistice, with the help of the Turks and all his own fleet, several weeks to clear a passage through the mines, on which Marshal Liman von Sanders so accurately based his reliance against any likelihood of the Dardanelles being forced.
Herewe are told that the British Admiral and Fleet, with the assistance of the Turkish forces, were occupied several weeks in clearing out the mines that had been laid by the Turks. If such success is possible to the Turkish people, surely the intelligent manhood of Australia is quite capable of following their example ! There is this difference to be noticed, that theattacks on the Dardanelles, at Gallipoli, were directed from a base within a few hours’ steaming, while any hostile force which came to Australia would be thousands of miles from its base. Do honorable members ever stop to consider what is meant when naval experts tell us that the greatest force that can be transported in one shipment, as it were, is 50,000. An extremely large number of transports have to be used, and every ounce of foodstuffs carried, with fodder for horses, equipment, ammunition, coal for steamers, and colliers following up in order that the bunkers may be replenished. It is ridiculous to imagine that Australia can possibly be effectively attacked, unless, of course, there is in power a Government such as we have to-day, which is afraid of its own shadow. Such a Government, at the first shot from an enemy force, would haul down the Australian flag. But the manhood of Australia is not built on those lines; it is prepared to fight for the rights of Australia. Instead of the Government and their supporters decrying their country, they ought, to use popular and picturesque language, to “ go down on their bended knees,” and thank God that Captain Cook discovered the greatest country ever known - Australia.
I do not wish to weary honorable members with references to authorities, but I should like to give them an idea of what a gigantic undertaking it is to transport large numbers of troops. During the last war some eighteen or nineteen months were occupied in transporting 2,000,000 men, half non-combatants, from America to France. In this work180 British transports were used, in addition to the American transports, and between thirty and forty Norwegian boats commandeered by the American Government. It must be remembered that these troops were being conveyed across the open sea from one friendly shore to another where everything was prepared for their landing; nevertheless, some eighteen or nineteen months were occupied in the work of transport.
Mr Lazzarini:
– And the distance was not half what it is to Australia.
Mr MAHONY:
– Quite so. Further, the transports were backed up by the whole of the mercantile marine of the Allied Forces.
Which is the power that is going to attack us ? From which country are we in any danger ? Will the Government tell us? Surely it cannot be Germany, who is beaten to her knees? Is it France, I wonder, that is now reaching out for world domination? Is that country prepared to relinquish the Ruhr, give up the whole of the iron deposits she desires, and come to the southern seas to attack Australia? I cannot think it is France, which, in my opinion, has quite sufficient nearer home to keep her fully occupied. Are the suggested preparations directed against America? It is well that we should “ call the bluff “ of . this empty Australian Government. If the design ©f the Government is to assist in some deep Imperialistic scheme to involve us in war with America, I frankly tell the Government that the men of Australia will not allow them to carry it into effect. Australia will be no party to a war with America. The two great Englishspeaking peoples of the world are not going to quarrel and go to war if the working classes of the Mother Country and America have any say in the matter. And the workers of Australia, in common with the working class movement in England and America, will see to it that this country is not involved in any conflict with the great American Republic. Therefore we may safely dismiss that contingency, and consider whether Japan really represents a future menace to Australia. But what has Japan to gain in Australia? Does this country hold any promise more attractive than the prospect nearer to Japan ? If Japan is imbued with the desire for conquest, what is wrong with the Dutch East Indies? Holland, with a population of about 7,000,000 people, and with no army or navy, is in no position to defend herself against any strong mercenary power that may have designs upon her overseas territory. The wealth of the Dutch East Indies is quite equal to the wealth of Australia, so if that is what Japan is after,, why is not Holland filling the air with cries about the threatened menace, and why is she not attempting to build up a huge navy to defend her territorial possessions ? Is Japan seeking territorial expansion? If so, what is wrong with the Mongolian Plains, which stretch east and west 2,500 miles, and north and south 700 miles? Out of this terrritory, on two occasions in history, have emerged the Huns, who overran and devastated Europe. To-day that vast area is inhabited by a few nomadic tribes, and it should be quite within the power of Japan to occupy it and find her outlet there. In 1918, she invaded Eastern Siberia, a country stretching 1,500 miles east and west, and with a population of under 2,000,000, but later had to evacuate it. If she seeks territorial expansion, surely there is ample opportunity right at her doors, and with none of those transportation problems that would confront her if she attempted the conquest
- of Australia. But no. “We are told that % Japan seeks none of these things. We are asked to believe that she wishes to conquer Australia simply for the purpose of rubbing Australia’s face in the dust. Unfortunately for those who wish us to regard Japan as the bogy, the people of that country, like the people of Australia, have no desire for war at all. The new idea is rising hi Japan, just as it is rising in the western world. Those of us who are prepared to give any study to the working class movement in the different countries in the world, know that the workers of Japan are now demanding a greater share in the wealth of that country, and the right to live decently. The growing power of this working-class sentiment which is now permeating the Japanese Empire is, I think, the greatest bulwark of safety for the nations of the world against future wars. Before many years are over, the Japanese working class will take their stand in the vanguard of civilization alongside the organized workers of Western countries, and’ will declare definitely against future wars. We have been told that there is to be no more secret diplomacy, and that the last war was one to end all wars. .As far as the -working people of the world are concerned, I can tell honorable members that they have done with war. The only war that they are declaring now is upon the war-mongers. Under that banner they stand solidly together. They will fight under no other. Notwithstanding that secret diplomacy was to be wiped out, we find the Prime Minister declaring in his most polite and cultured manner that he has been called to a Conference at the heart of the Empire to help solve some of these great world problems. We want to know Before he leaves our shores just what those problems are, and we want to express our views upon them. If the Prime Minister imagines that, without first consulting this Parliament, he can bind Australia to any definite course of action, he will get a very rude awakening before many years have passed over his head. The people of Australia will sweep him and his Government from office.
I do not wish to delay the House, but I felt that it was as well that some of the opinions of the experts to whom I have already referred should be placed before honorable members and the country, and read side by side with statements made by scare -mongering supporters of the Government. Is it not appalling to think that when the question of the defence of Australia is being debated in this Parliament, the Minister who is supposed, to be charged with this responsibility remains silent? It cannot be said that the Prime Minister knows very much about defence.
Mr Manning:
– He is out to learn.
Mr MAHONY:
– No doubt; but, unfortunately, whilst he is learning Australia is being sacrificed through inexcusable blundering. Not one word of protest has been uttered toy the members of the so-called Country party. What of the interests of the primary producers? Surely they had a lesson during the recent war.
Mr Hill:
– We thought the honorable member and his colleagues were looking after the interests of the primary producers.
Mr MAHONY:
– Yes, and we shall continue to do so, and more effectively than the members of the honorable member’s party. During the Great War, the wool, wheat, and .meat of the Australian producers sent overseas was sacrificed in the interests of the Wool Commission and Wheat Pools in Great Britain, which made huge profits at the expense of the hard-working producers in the Commonwealth. In consequence of the methods adopted by the Nationalist Government, £200,000,000 was lost to the producers. Australia will shortly be asked ‘ to contribute, towards the maintenance of the British Navy and the cost of establishing an extensive naval base at Singapore ; but surely the primary producers of Australia contributed their share when they lost £200,000,000.’ It was only after a strenuous fight during the last Parliament by honorable members on this side that the wool-growers were able to receive onehalf of the extra profits which the Wool Commission in Great Britain made on the sales of Australian wool. Although the producers were shockingly underpaid there has been no word of protest from the representatives of the Country party. They are dum’bstricken and apparently overwhelmed when the Prime Minister (Mr. Bruce), in that superior manner which characterizes his actions, tells them that Parliament must go into recess in less than ten weeks. He has told them that he must go to Great Britain to save, in the words of the honorable member for Bourke (Mr. Anstey), the world,. and then Australia. The Prime Minister is to be given an open cheque and the privilege of going to Great Britain to do just what he likes. I wonder what the people represented by the members .of the Country party will say when the Prime Minister returns, and they find that Australia’s credit has been .pawned and the interests of the primary producers sacrificed. It will be useless to criticise him then, and the tragic words “too late” will be all that will be uttered bv those who now misrepresent the interests of the rural population. There is only one party which protects the interests of the primary producers and the people generally, and that is the Australian -Labour party, which is determined to put Australia first. We believe that we can defend ourselves, and we will awaken the spirit of the Australian people ‘by carrying a truly national sentiment into their hearts and homes.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– I am supporting the amendment moved by the honorable member for Bourke (Mr. Anstey), because I believe the present is only a stop-gap Government, and cannot be regarded as even a third-rate team. There are only three men in the Ministry who are worthy of a position in any decent Government. The Prime Minister (Mr. Bruce), who is a comparatively new member in this Chamber, has been assisted into his present position by the ex-Prime Minister (Mr. Hughes). When Parliament demanded that Australia’ should be adequately represented at the Conference of the League of Nations at Geneva, the present Prime Minister was touring the Continent, and as no one else was available, he was directed to accompany Mr. ‘Shepherd to that gathering. On his return he submitted a report of the proceedings to this. House, and later the ex-Prime Minister elevated him to the position of Treasurer. Notwithstanding the assistance he has received from his late chief, he was not prepared to stand by an old colleague.
Mr Bayley:
– That is not so.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– It is, and his action proves it. If the information I have received is correct the ex-Prime Minister wished to meet Parliament and place a policy before the country, but the members of the Nationalist party were anxious that he should be slaughtered.
Mr CORSER:
WIDE BAY, QUEENSLAND · LP; NAT from 1917
– That is not so.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– Those are the facts. In fairness to the Prime Minister it should be stated that he did not wish to displace his old chief, but after a majority of the party decided to dispense with the services of the right honorable member for North Sydney (Mr. Hughes), Stanley Melbourne Bruce came into the field, and although he lacks political experience is now leading the House. The managers who conducted the negotiations worked in their own interests, and in doing so sacrificed the best men on that side of the Chamber. To show that men of outstanding ability were displaced to make room for those who are only fit to tie up their boot-laces,I might mention that the present Minister for Defence (Mr. Bowden), the Postmaster-General (Mr. Gibson), the Minister forWorks and Railways (Mr. Stewart), and the Treasurer (Dr. Earle Page), who were managers at the conference, are now holding portfolios.
Mr Yates:
– The honorable member for Warringah (Sir Granville Ryrie) said that if he had been a manager at the conference, he would now be a Minister.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– Yes, the Prime Minister sacrificed those who were not managers, and in following the line of least resistance appointed to the Ministry those who were conducting ‘the negotiations. The ex-Assistant Minister for Defence (Sir Granville Ryrie) went on active service at the outbreak of war, and when he returned the Prime Minister honoured him by placing him in the Defence Department. What reward has he received from the Nationalist party? In his place they put the honorable member for Parramatta (Mr. Bowden), a man who had no military experience, and whose only qualification for the position was the fact that, possibly, he might have seen boy scouts marching past a saluting base on Parramatta Park. There was no comparison between him and the honorable member for Warringah (Sir Granville Ryrie), who was a trained military man, and knew all about the Defence Department. Replacing the honorable member for Warringah by the honorable member for Parramatta was an insult to the people of Australia.
I understand that the honorable member for Martin (Mr. Pratten) helped considerably in the negotiations that led to the formation of the Composite Ministry. About that time almost every issue of a Sydney newspaper contained a photograph of the honorable member. At first we had the headline, “ Mr. Pratten Looms Largely.” Next morning the honorable member’s photograph was associated with that of the honorable . member for Cowper (Dr. Earle Page) with the footnote - “ A Strong Pair. Mr. Pratten a great business man. Sure to be in the Ministry.” After a day or two the honorable member for Martin was associated in the Sydney newspapers, not only with the honorable member for Cowper, but also with the honorable member for Flinders (Mr. Bruce), and the public were informed that they were “Three Strong Men.” The public of New South Wales was worked up to the belief that the honorable member for Martin, the strong man and the business man, was sure to be Commonwealth Treasurer. The honorable member has certainly built up a reputation as a business man, and there is no doubt as to his ability as a debater and logical thinker, but although he had justice on his side in a claim to be included in the Ministry, the honorable member for Cowper and the honorable member for Flinders did not stand by him. I suppose they did not want “ a strong man “ in the Ministry, and so the honorable member for Martin was put on one side along with the honorable member for Warringah (Sir Granville Ryrie). Yet these honorable members are expected to be dumb followers of the Government. If they are of the calibre that I think they are, they will not be dumb.
The honorable member for Wakefield (Mr. Foster) was in the last Ministry. In fact he was one of the best Ministers the Commonwealth has had in control of the Department of Works and Railways. Before coming to this Parliament, fifteen years ago, he had already had seven or eight years’ Ministerial experience in the State of South Australia. What he gave his pledge to do, he carried out.
Mr Brennan:
– He was a good friend of Canberra.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– Yes, because he had an open mind, and took a broad view of everything. He carried out whatever he took in hand. But he also was squeezed out of the Ministry, and when the people of South Australia complained that he had been replaced by half a Minister I looked around to see who was that halfMinister. I found that it was Senator Wilson. A live and experienced Minister has been replaced by half a Minister, and, in order to strengthen the delegation to the Imperial Conference, that half-Minister is to accompany the Prime Minister to London. Will it not be a “ strong delegation “? In any case the Prime Minister proposes to go to Great Britain without a mandate from the people. He did not face the electors as the Leader of a party or as a Prime Minister. He went to the country as a follower of Mr. Hughes, and declared that if Mr. Hughes went down he also would go down. It was a manly declaration, but, unfortunately, Stanley Melbourne Bruce was not manly enough to stand by it. We have no right to allow a man to go to England to represent Australia who has been proved in this House to be a “ brum.” One who does not stand true to his friends cannot be trusted. The Prime Minister has proved false to his best friends. Otherwise how could he have sacrificed the honorable member for Warringah (Sir Granville Ryrie) and the honorable member for Wakefield (Mr.Foster ). He and his Government not having faced the music have not the indorsement of the people. They are a scratch team. When a football or cricket team is sent from Australia to play a series of matches in Great Britain the best men are chosen to go, but I could pick two teams in this House who would prove to be far stronger than are the present Ministry. The weakness of the Cabinet will be plainly demonstrated as time goes on.
The first representative of the Country party to come into this House was the honorable member for Echuca (Mr. Hill), a gentleman who has so earned the respect of the farmers that he has been chosen to represent them on various Boards. He also was ignored in the formation of the Cabinet.
Mr Gabb:
– He was not one of - the managers.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– That is so. No one fought harder for the interests of the Country party than did the honorable, member for Swan (Mr. Gregory) during the Tariff debate. Compare him with the gentlemen who now represent that party in the Composite Ministry. It is rather strange that the managers who represented . the Country party in the negotiations that led to the formation of the Ministry were afraid to meet their fellow members, and report the fact that they has been recommended for portfolios. Instead of asking for the indorsement of the party, they went to Government House and were sworn in as Ministers. Can any Government last that has been formed on such lines? Surely we on this side of the chamber should use every legitimate means in our power to bring the Ministry to an end, and replace it by a better team.
The Prime Minister is to go to Great Britain accompanied by a half-Minister who, during the election, proceeded to Queensland in order to see how cotton was growing, so that he might not take any part in the political battle raging at the time, and who, when the fight was over, was invited to join the Ministry.
Another Minister is the honorable member for Wilmot (Mr. Atkinson). He was a Nationalist in the last Parliament, but at the eleventh hour he tumbled over to the side of the Country party.
Mr Atkinson:
– I did not wait until the eleventh hour. I declared myself at the proper time. The honorable member should confine himself to facts.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– The fact is that the honorable “member was a Nationalist in the last Parliament.
Mr Atkinson:
– That is true. I sat as a Nationalist, but I had been elected as a Nationalist.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– The honorable member did not have the courage to fight as a Nationalist at the last election.’
Mr Atkinson:
– I had the courage, but not the conviction.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– The honorable member’s return gave the Country party the idea that it had gained a seat. He could also have won the seat as a Nationalist, if only on the strength of his good looks. The Treasurer (Dr. Earle Page) met him in the Queen’s Hall and exclaimed, “ I am glad you have come into our party. You will be a Minister.” The honorable member was nearly paralyzed. Taking the personnel of the Ministry generally, they comprise very good fellows, but the majority of them have had no previous experience as Ministers and very little as private members. Apart from the three gentlemen I have indicated, they are the weakest team ever seen on the Treasury bench. I do not believe that the Prime Minister has the confidence of the people. The ex-Prime Minister (Mr. Hughes) has the vim and personality necessary in a leader. He fought the elections, and thereby made it possible for Mr. Bruce to secure office. Let me congratulate the Postmaster-General (Mr. Gibson) on having managed matters so well in his own interests. New South Wales has twenty-eight members in this House and Victoria twenty. New South Wales contributes the largest amount of revenue to the Commonwealth and has the largest population of any of the States; yet it has only two members in the Ministry as against Victoria’s three. I congratulate the Treasurer upon having placed the Prime Minister on the table, administered an anaesthetic to him, and obtained so much out of him.
Mr Groom:
– New South Wales has three Ministers in the Cabinet.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– I stand corrected there. I was mistaken. Positions for Government supporters were found on the Public Works and Public Accounts Committees, -and as a great sop to the honorable member for Forrest (Mr. Prowse), for whom there was no other job left, he was made messenger to the Government Whip ! That is how the Nationalists removed the barriers between themselves and the Country party. I would prefer to see men like the honorable member for Echuca (Mr. Hill) included in the Ministry - practical, honorable, and straightforward men. The honorable member for Swan (Mr. Gregory) has won his spurs as a Country member, and he deserved better treatment at the hands of his party. My friend the honorable member for Wakefield (Mr. Foster) should not have been dropped. I was staggered when I heard it, and I quite believe that he was, too. He was in Melbourne all the ‘time the Ministry was being selected, and he naturally expected to be sent for, because he had, I understand, been spoken to. The party managers were afraid to meet their respective parties and report progress. They knew that if ‘that had been done the personnel of the Cabinet would have been different.
Mr Coleman:
– What about the honorable member for Wentworth?
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
- Mr. Marks gave up his home in New South Wales and put in all his time at his parliamentary work. He qualified for a Ministerial position. Notwithstanding his great experience as a Naval expert- he held a commission in the British Navy and underwent great hardships during the war - he was displaced by less competent men. The party opposite lost its brains when it discarded its leading men such as the honorable member for Warringah (Sir Granville Ryrie), the honorable member for Wakefield (Mr. Foster), and the honorable member for Wentworth (Mr. Marks). Brains such as these honorable gentlemen possess are sadly lacking in the present Administration. In the interests of the progress of Australia we ‘should not allow a stop-gap Ministry to remain in power. It is merely a third-rate Cabinet. Hardly in honorable member opposite is prepared to stand up and defend the Ministry except the Prime Minister himself. The late Government had a good debating team behind it, but the present Ministry, after meeting the House for a fortnight, closed Parliament for nearly two months to enable them to formulate a policy.
Ministers wish to confine the session to a period of ten weeks owing to the meeting of the Imperial Conference. It should be realized that honorable members have been elected to do the work required of them. There are thousands of unemployed in the various States, and the cry for a unification of railway gauges is insistent. We are told that thousands upon thousands of immigrants are needed. The best way to prepare for immigration is to make Australia prosperous, but there is nothing in the programme of the present Government calculated to bring about that result. Judging by the Prime Minister one would imagine that the Imperial authorities were incapable of looking after themselves, and were in dire need of help from Australia. The Prime Minister intends to go to London, accompanied by what has been characterized in South Australia as “ half a Minister.” The team will certainly be the weakest one that has ever represented the Commonwealth at an Imperial Conference. We have heard of
Empire defence, immigration, and preferential trade on many previous occasions, so that the Prime Minister is not embarking on any new project. After hurrying around the States he summoned the Premiers’ Conference torgether, and put before the States a great financial scheme. Was anything of a definite character’ done? The Premiers appear to be still considering and finalizing their vews. A second Conference was called, a further vote was taken, and the Premiers went to the theatre and had a dinner or two. Now they have returned home, and nothing has been accomplished. Surely there is plenty of work that we can do without calling in the aid of the Premiers. The amalgamation of Taxation Departments has been suggested as a means of saving money. I could point to one or two other Departments in which money could be saved without invoking the help of the Premiers. There are Departments in each of the States for making payments in connexion with war gratuity bonds, and the Government is paying the returned soldiers the same rate of interest that would have to be paid if the money were borrowed. The Government could borrow the money, pay off the bonds, and save thousands of pounds by closing up the Departments that are handling this business. Something similar could be done with old-age, invalid, and military pensions, which are paid through two Departments, and could be paid through one without consulting the State Premiers. Although there is a Commonwealth Government Line of Steamers, consisting of five up-to-date vessels, the Government subsidizes private shipping companies to the extent of nearly £250,000 a year for carrying mails. Why does the Government not allow the Bay Line to carry the mails, and credit it with £250,000? If that were done the Line might pay. There are thousands of ways in which money could be saved, and the prosperity of the country increased. Instead of doing these things, the Government wastes time in consulting the Premiers. It would seem that the members of the Government have no original ideas, and want to find out what is in the minds of other men. Every opportunity I have of voting against the Government I shall’ seize with pleasure. During the last election the Government, as a Government, was not before the electors. The Prime Minister said that if Mr. Hughes went out of office he would go out also. Where is he to-day? Has he stood by his pledge? Not at all, and when his friend was down he deserted him. The same thing happened to the honorable member for Wentworth (Mr. Marks), and the honorable member for Wakefield (Mr. Richard Foster). Another unsavory incident happened in connexion with the appointment of Mr. Speaker. The honorable member who formerly sat in the chair did his duty well, but two or three days before the House met he received a notification that he must not be nominated for election as Speaker. I know the present Speaker was not responsible for this action. To what a pass have we come? The ex-Speaker, although he had served his party faithfully, was not re-elected because it did not suit the Government to have the honorable member for Balaclava (Mr. Watt) on the floor of the House. That is another unsavory incident in the conspiracy to place and keep the Government in office.
Mr SPEAKER (Et Hon W A Watt:
BALACLAVA, VICTORIA
– The honorable member is not in order in using the word “ conspiracy.”
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– I will withdraw the word, Mr. Speaker, if you can find me a better one.
Mr SPEAKER:
– The honorable member must withdraw it.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– I withdraw the word “ conspiracy,” and say that it was a compromise arranged by the Composite Ministry to get the -ex-Speaker out of the chair, and appoint in his place a gentleman who is a capable debater. It was a compliment, no doubt, to the present Speaker, and is one of the acts that has helped to keep the present Ministry in office. I heard the Prime Minister speak in reply to the honorable member for Bourke. I have heard him deliver the same speech three times. It related to employers, defence, and trade. The same sentiments can be read in the speeches of Cobden and Bright. In the mind of the Prime Minister, trade dominates everything. Members of the Opposition stand for the betterment of humanity before the advancement of trade. The gauge of the prosperity of the country is the happiness and content- merit of its people. We, the Opposition, owe it as a duty to the people of this country to show the Government in its true light. The Government has not yet received a vote of confidence from the electors, and no previous Government has been formed in similar circumstances. The party managers came together and, because certain individuals had changed over from the Nationalist party to the Country party, they were put in the Ministry. It is a stop-gap, third-rate Ministry, and the sooner it is. hurled from office the better for the country.
Question - That the words proposed to be added be so added (Mr. Anstey’s amendment) - put.
The House divided.
AYES: 25
NOES: 39
Majority . . 14
AYES
NOES
Question so resolved in the negative.
Amendment negatived.
Mr SCULLIN:
Yarra
.- I move - .
That the following words be added to the proposed Address: - “ but we are of the opinion that the Government is deserving of the severest censure for its grave breach of public trust in the sacrifice of the Commonwealth Woollen Mills at Geelong.”
The recent sale of the Commonwealth Woollen Mills at Geelong is a startling revelation of the composite mind of the present Government. This sorry transaction reveals the ugly fact that the Government represent the sordid interests of a financial clique in opposition to the rights of the Australian people. It exposes the woeful business methods of this Administration, and proves the Ministry’s incapacity, or something worse. To dispose of a necessary and highly profitable undertaking is bad business, but to sacrifice the most up-to-date and efficient woollen mill in the Commonwealth adds enormously to the gravity of the offence. In presenting my case, I propose to rely entirely upon the facts and official figures, and I shall unfold a story . which will amaze the people of this country. They will be amazed to learn that such a transaction could be carried out by the alleged “business Government” who are undeservedly in charge of the affairs of the Commonwealth. In order to put the true position before honorable members, I shall briefly review the salient facts in the history of this enterprise.
In- 1910 provision was made on the Estimates by the Fisher Government for the establishment of Commonwealth Woollen Mills. The then Minister for Defence (Senator Pearce) stated that the principal reason for the establishment of these mills was the great difficulty of obtaining supplies and the inferior quality of the cloth that was available. An expert was obtained from Scotland, who proved to be a very valuable man. After touring the length and breadth of Australia, he selected a site for the mills at Geelong. The present site was granted to the Commonwealth by the Geelong Harbor Trust with the consent of the Victorian State Government, and, in effect, was a present to the people of the Commonwealth from the people of Victoria. Had the people of Victoria dreamed that this block of ‘13 acres of land was later to be transferred to a private company, the Victorian Government would not have dared to part with it as they did at that time. To-day is the first opportunity I have had of perusing the file of papers in respect of the establishment of this mill. The Home and Territories Department, in a memorandum to the Defence Department, stated -
The Commonwealth is under a moral obligation not to part with the fee-simple of the land without consulting the Geelong Harbor Trust and the Victorian Government, which passed a special Act giving this grant.
The Minister for Defence attached this minute : “ Wait for the Victorian Government to raise the question.” I find that the Geelong Harbor Trust entered a protest as follows: -
Had it been considered possible that a sale to private individuals might at some time be made, the gift would have been on different terms and reversion to the Trust provided for.
The Trust also asked for compensation. However, the land was secured, and in 3913 Mr. Smail, the expert and manager, was sent to England to purchase machinery. In 1913, 1914, and part of 1915 the buildings were erected. I emphasize those dates to show that the Bill authorizing the construction of the woollen mills was not a war measure, and the excuse which will be put forward that, the war being over, the Government are justified in selling the establishment, would fail in the light of these dates. The mill was a project undertaken in time of peace a£ the instigation of the Defence Department. The manufacture of cloth commenced in September, 1915, but not until April, 1916, were all the machines in operation. Since that date ‘the total net profits of the mill have been £190,000. The official reports disclose some interesting information. The manager, Mr. Smail, in 191S, stated -
Cloth was supplied to the Department at prices lower than the existing contract rates.
The official report by the Secretary for Defence (Mr. Trumble), in 11918, stated -
It can be authoritatively stated that these factories have materially improved the quality of military clothing and equipment generally.
There are two official reports - one saying that the mills supplied the Departments at prices lower than the existing contract rates, the other saying that the quality of the output was improved. Senator Guthrie, speaking in the Senate on loth September, 1922, made the following statement’ -
Whilst charging comparatively low prices for splendid material, the Government Hills have been able to show a substantial net profit, year after year, and employment has been under the best possible conditions. . . . The mills have tended to prevent - arid I think this is a very important fact - Government Departments and returned soldiers from being exploited. . . . They turned out highly satisfactory material at 5s. 0d., ‘6s. 6d., and 7s. 6d. per yard, when other manufacturers were charging double that price….. Private manufacturers were charging from 10s. 6d. to 12s. 6d. per .yard for similar material to that being supplied by the Government Mills at 6s. 6d.
I have totalled up the output of that mill; it is approximately 4,000,000 yards of cloth, and 30,000 pairs of blankets. If honorable members will look into the conditions that existed in 1916, 1917, and 1918, they will find that, had we not had working this mill an expert who possessed practical knowledge, this country would have paid many millions more for its material. No official, however expert, can on theory combat practical men when he meets them. At their conferences the Government were able to produce Mr. Smail. When the other manufacturers said, “ We cannot manufacture at this price,” Mr. Smail showed them the cost prices at the Geelong Mill, and said, “ We are doing it at considerably less than that figure.” That had the effect of keeping down prices ; and it would be a very low estimate to say that the country was saved up to £3,000,000. When we show what has been the net cash profits, and the saving which has been effected, the only answer we get is, “ But tho mill does not pay income tax and municipal rates.” I have figured that out, and I find that the addition of 3d. to 4d. per yard to the mill prices would enable it to pay all the rates and taxes. Yet Senator Guthrie says that the mill sold at prices which averaged 5s. per yard less than those of private manufacturers! I want to emphasize the fact that the £190,000 net profits are not the actual profits. The Department adopted the practice that, after the mill had paid all its charges, and allowed for an extraordinarily high depreciation, it had to return to the Treasury 5 per cent, on all the capital invested in tho erection of the buildings and the purchase of plant and raw material, together with the current working capital. Interest on this capital is charged to expenses, but the interest on the capital invested in a company is included in the profits, il have prepared the following table from the official balance-sheets of the mill for the years 1916-22: -
The following is a summary of the totals for the six years: -
T want honorable members to note that more than half the total profits were made in those two years after the war; those were the years during which the soldiers were going about this country clad in suits of clothes made from material bought from that mill - suits which cost them about half the price that we, at the same time, were paying for our suits of clothes. During the time that the soldiers were getting that benefit - a benefit which the outside public were clamouring to have extended to them - this mill made more profit than it had made in all the preceding years. So delighted were the Government with the pronounced success that ~h£d attended the operations of this mill, with the improved quality of its material, the lower prices it was charging the Defence Department, and the hugh net profits it was making, they placed upon the Estimates a sum of £45,000 in. 1920 for the duplication of many of the machines in order to double the output of the mill. The buildings were so erected that they lent themselves to expansion, much of the plant was capable of providing for an expanding business, certain machines only were required to enable the mill to double its output, and it was estimated that an expenditure of £45,000 would be sufficient. But something happened. Reports appeared in the press that business men were becoming restive with the Hughes Government; they were saying that Mr. Hughes was still leaning to Socialism. Secret negotiations were proceeding, whispers appeared in paragraphs occasionally, there was a re-shuffle in the Cabinet, and Flinders-lane obtained representation in the Ministry. From that moment, as a matter of course, the mill was doomed. A few months afterwards the decision of the Cabinet was made known that the mills were for sale. What influences were at work? I shall not give my opinion; I shall quote the opinion of the present Postmaster-General. The honorable gentleman, when he was a member of the Country party and opposing the. Government, said -
The National Federation is an organization of vested city interests drawing a colossal fighting fund from the manufacturers and from Flinders-lane.
In his opinion they were the moneymasters of the Government. Those moneymasters hated the mill. They had reason to hate it. They hated it because the profits it was making,. they thought, should have been theirs. They hated it because, by underselling, it was exposing their profiteering. The output of every other mill was filtering through institutions like those in Flinders-lane, raking off 15a. to £1 a yard on cloth which soldiers were getting from about 8s. to 10s. per yard. They hated it because it had proved an effectual check upon profiteering during the period of the war. Above all, they hated it because the profits of the mill proved conclusively the success of nationalization, and they believed that the people would be clamouring for an extension of the principle. When they decided to sell this mill they were faced with difficulties. The old assertions that had been levelled against nationalization - that, it must fail because it was inefficient and the taxpayers had to make up the losses - were shown by the balancesheets to be completely false. The Government and the anti-Labour forces of this country were compelled to come out into the open and declare their real policy ; so they said, “ The reason we are selling the mill is that we cannot provide sufficient work for the
Defence and other Departments, and only by selling to the trade would we be able to carry on. That would mean competition with private enterprise, and to that the Government is opposed.” They said that they considered it to be against the public interest to run the mill for the profit of the people. To compete with private enterprise is against their policy. Their policy is to represent the financial clique - the “money masters,” of whom the PostmasterGeneral spoke - who provide their colossal party fighting funds. There can be no competition with them! It is interesting at this point to glance at the wealth census statistics, and so to gain an idea of the enormous power wielded by this clique. The statistics disclose that 466 persons in Australia possess £92,000,000 worth of property, so’ that in the provision of fighting funds for a political party their power is enormous.
We find, from the Government’s own declared statements, that they will not compete with private enterprise, although it may be essential in the interests of the people to do so. This proves that it is a Government for the money magnates. No profits for the people! The way must be cleared for private enterprise! That is their policy, and there I leave it for the time being, in order that we may examine the business methods of this so-called business Administration!. I ask honorable members opposite what mandate their Government had to sell the Geelong Woollen Mill? What right had they, before this Parliament had a chance to speak its mind, to push on with the sale with indecent haste and to throw to their friends this great prize? Why did they not wait for an expression of opinion on the part of this Parliament? I shall be told, of course, that a vote was taken on the question in the last Parliament and’ that the majority agreed to the selling of the mill. But, what has been the fate of many of those who voted for the sale? Forty-one honorable members voted against my motion protesting against the proposed sale of the mill, and of that number seventeen, including the Minister who was in charge of the Department that proposed to sell it, were defeated at the last general election. There are on the Government side of the House to-day only twenty-four honorable members who voted for the sale of the mill, or but onethird of the total membership of this Chamber. I claim, therefore, that the Government had no mandate from the country to sell the mill.
Mr Killen:
– We were elected on a policy of non-Government interferencewith private enterprise.
Mr SCULLIN:
YARRA, VICTORIA · ALP; FLP from 1931; ALP from 1936
– Then, I invite the honorable member to go back to his constituents and to see whether they would return him on the business methods pf this business Government.
Mr.Killen . - I am prepared to do that.
Mr SCULLIN:
– The honorable member would do well not to speak too soon. When he hears all the facts he may change his tune. Is it the policy of those honorable members opposite that there should be no competition of any kind with private enterprise? If it is, I would put to them the further and most important question, “ Are they in favour of getting rid of our public property at any price ? “
Let us come now to the businessmethods of this “ business “ Government.. After waiting two weeks, I had an opportunity to-day, for the first time, to see the departmental file relating to the sale of the Geelong Woollen Mill. I admit that I was shown every courtesy and was afforded every opportunity by the Minister and his Department to-day to examine the files.
Mr Lazzarini:
– It was a rather belated opportunity.
Mr SCULLIN:
– Quite so. I spent an hour and a half in going through the files, and had to work hard to collect these facts. I have been trying for weeks to obtain the necessary papers, and having at last had an opportunity to peruse them, I gather that the Munitions Board made certain recommendations regarding the mill before a decision was arrived at as to its sale. Every one knew, of course, that with the cutting down of our Defence expenditure the mill would not be kept going on Defence work, and that if its operations were to continue it would have to sell to the public. But that is against Government policy. What an awful crime it would be for a publicly-owned mill to sell its output to the public! What an awful crime that the people should have a chance to obtain cheap clothing, blankets, tweed, or flannel from a mill built and paid for by themselves! The Munitions Board submitted to the Department three recommendations, and I emphasize the order in which they were given since- it discloses to us the mind of the Board with regard to the matter. I should like to say in passing that as a result of a careful examination of the departmental files, . 1 think that the Munitions Board, which controlled the undertaking, has been careful and efficient at every stage of the transaction. It was, however, considerably handicapped by the policy of the Government and by interference. The first recommendation made by it was that the mill should be continued, and that orders should be solicited from the trade for the balance of the output. That was a common-sense suggestion. Its second recommendation was that the mill should be leased for ten years to private enterprise, subject to the right of the Government to determine the lease in an emergency. The third was, “ Sell the mill outright.” In its report the Board made this statement - -
The- output, £1,164,547, has undoubtedly rendered great service in providing high grade cloth at prices comparing more than favorably with trade prices.
That was the verdict of a Board which, from the beginning, came in close touch with the operations of the mill and with trade prices. What action did the Government take? It did not accept the first recommendation nor the second, but adopting the last, decided to sell the mill.
How does this business Government conduct the country’s business ? Howdoes it look after the public property of Australia? If it displayed, in respect of public property, one-tenth of the great anxiety that it shows for private concerns, we should not be telling this story in the Blouse to-day. It sold this property s consisting of 13 acres of land, buildings, machinery, and plant, as a going concern to James Dyer of Flinderslane, and others, for ‘the sum of £155,000, and in a statement published at the time in the press, the Prime Minister said, “ The Government considers this is a satisfactory sale.” It certainly was a satisfactory sale - to those who bought the property. I find from the official figures that the buildings originally cost £81,000.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– Pre-war costs.
Mr SCULLIN:
– I am coming to that. The mill is a magnificent structure built of brick, with concrete floors, iron roof, and steel girders. Honorable members should inspect it. There is nothing in Australia to equal it, nor is there in Australia a -plant equal to that installed in the building. The plant and machinery originally cost £83,000, and additional machinery, costing £40,000, was subsequently installed. This gives us a total of £204,000. Since then there has been placed on order machinery to the value of something under £5,000, so that the total original cost would amount to about £208,000 or £209,000. I would emphasize the point mentioned by the honorable member for South Sydney (Mr. E. Riley), that the construction of the building was commenced in 1913 ; the work was carried on through 1914 and was completed in 1915, so that pre-war prices ruled throughout. The £83,000 worth of machinery originally installed in the mill was purchased in 1913, and the bulk of the additional machinery, which cost £40,000, was ordered before the war. Some of it was late in delivery, but most of it was bought at pre-war prices.
Mr Lazzarini:
– The figures quoted by the honorable member do not include the value of the land.
Mr SCULLIN:
– No, because the land was a gift. In order to ascertain What kind of a deal this was - knowing instinctively that it was a bad one, and that there must be something wrong with the figures - I secured an inventory of the plant, and took it to a machinery man. I asked him to give me a valuation of it. He said, “ I want an inspection of that place before I stake my reputation on a valuation.” That was not possible, and I told him that I would ask him to take the inventory and compare his price lists of the present time with the price lists of 1913 and 1914, allow for wear’ and tear, and tell me how he figured it out. The figure he gave me for plant and machinery and fittings generally was £185,000.
Mr Killen:
– Is that a second-hand valuation or a new valuation ?
Mr SCULLIN:
– It is a present-day valuation with allowance made for depreciation. I did not ask this machinery man to give me a valuation of the building. I thought I should go to a builder for that. I consulted two contractors, one of whom said, “ Add 90 per cent, to the 1914 cost and you get the price.” The other said, “ Add 80 per cent, and that will give the price.” I discarded both these valuations because they were those of contractors, and I decided to go to a building surveyor and ask him to work out the valuation for me. He put in a night at the work, and gave me his estimate. He said,’” A building that cost £14,500 in 1914 would cost in 1923 £25,000,” showing an increase of 72£ per cent, on the 1914 cost. I do not think that any building contractor would dispute that estimate. I went to various sources to find out what was the proper amount to allow for depreciation. I found from the balance-sheet that 5 per cent, was written off this brick building. Every one to whom I mentioned that said it was absurd. Even the Defence Department has been accustomed to write off only 2^ per cent, each year for depreciation on the Harness Factory at Clifton Hill. I find that the maximum amount allowed for depreciation in the case of factories and public buildings of brick construction is 1 per cent., though the amount is a little higher for private buildings. I take £81,000 as the original cost, and allowing an addition of 72£ per cent, for increased cost of con;struction to-day, the building to-day would cost .£139,000. I deduct 1 per cent, for depreciation over eight years, equal to £27,000, and I ‘get the present value at £112,000. I add to that £185,000 for plant and machinery, and obtain a total of £297,000 as the valuation of building, plant, and machinery, without the land. I asked myself whether that is a fair price at which to sell the mill, remembering that it is a going concern. If the company were to take Up an area of land and erect such a building and plant upon it, that is what it would cost them, but it would take them two years to get going, lt took nearly three years for this mill to get going. It would take the company two years before they could get going, so that I consider it is only a fair thing to allow, in addition, an amount equal to two years’ net profits. I, therefore, add the last two years’ net profits, and I will say why I take the last two years in a moment. They amounted to £103,000, so that my estimate of the value of the’ mill, plant, machinery, and buildings as a going concern is £400,000. This property has been sold by the Government for £155,000. The discrepancy was soenormous that I considered that I should be very careful in submitting the figures. I checked the figures again in another way. It might be said, “ It istrue that this mill cost a lot of- money, but you might not be able to get your price for it because the business might have gone down. It might not be paying, and you are entitled to examine profits and apply that test.” I did apply that test. Now what can be considered a fair way in which to look at profits? I scanned every one of the balance-sheets issued by the Defence Department from year to year, and I found a most interesting statement by the manager of the mill in the report issued for 1920-21. He says this, and I want to emphasize it because it is the crux of the question -
A change of policy waa initiated during the year, providing for a profit to be charged for other than Federal requirements, and as a result a very substantial credit balance remained after interest and depreciation charges. This was not reflected in the selling price of the goods, which were produced at considerably under current rates.
What “is the significance of that statement? It is this:’ The table of figures which I presented a moment ago shows that more than one-half of the profits for the six years were earned in the last two years ending June, 1922. This mill at the outset did not go for profits at all. It supplied public Departments and others at cost price, lt worked out its factory costs, and such charges added for overhead costs from year to year as experience warranted, sothat the profits earned for the first four years represent simply the margin of safety which the manager of such a business would always have in the form of an over-estimate of cost. It might be represented also as of the character of a bonus received from an insurance company. In 1920-1921 the policy of the mill was changed, and it was decided to continue to sell to Federal Departmentsat cost, but to all others at a profit, but as the official report says, at considerably under current rates. I take, therefore, those two years during which the mil! was selling 30 or 40 per cent, of its output at cost price, but was charging a profit on 60 or 70 per cent, of the output. In those two years the mill made a profit of £103,211. That was not the gross profit, because that was the profit after deducting interest. The actual profit for the two years was £128,302. The surplus goods representing 60 or 70 per cent, of the output sold outside the public Departments were sold by public tender to different State Government Departments, fire brigades, Tramway Boards, and so on, and a considerable quantity to returned soldiers at the prices I have referred to, which were “ considerably under current rates.” Yet the mill made an actual profit of £128,302 for these two years, or an average profit of £64,000 per annum. I come now to the question of taxes - Federal and State income taxes, land taxes and municipal rates - and I estimate that they would amount in the six years to £10,000. I deduct that amount from the £64,000, and this leaves a clear net annual profit of £54,000. I allow 10 per cent, for the company’s money, and capitalized at that rate it would give over £500,000 as the value df this concern. In this way I arrived at a higher figure than my first method of valuation disclosed. The new company could say, “ For two years we will not look for any return, because it would take us two years starting from scratch to erect the building and plant. We will in that time be able to- write off the whole of the cost of the purchase price. If we deduct the taxation charges we .must add a few months to the two years, at the end of which time the company will have the- concern at a gift.”
Now I come to the second recommendation of the Board, which was to lease the property. That the Government disregarded, although it would have enabled them to resume the property in case of emergency. If the Government had agreed to lease the mill, charging the same interest and allowing the same depreciation as under the old management, the company would have been on a “ good wicket.” They would have taken the mill over as a running concern, keep all the profits, and charged what they chose; but it would have been a much better business proposition for the Government than is the sale. The depreciation alone represents the amount of the deposit and annual instalments, and at the end of ten years under the present arrangement the whole concern will have been handed over as a present to the company. In other words, the conditions of sale are such as to enable this new company to simply put down each twelve months the same amount of money as the Government! were allowing for depreciation. If this is a “ business ““Government, then spare the people of Australia from another !
The figures I have quoted I have obtained from experts outside the Department. But I Went to the Department this morning, and there I made » discovery. I learned for the first time, as I think honorable members do now, that there was an independent official valuation made of this property. In all the public statements by the Prime Minister, the Minister for Defence, and the supporters of the Government, including the long statement made by Senator Guthrie, who has inside knowledge, not a word was said about this valuation. We were not told that this valuation had been made by Messrs. Wilridge and Sinclair, an engineering firm of 590 Elizabeth-street, and that their expert was Mr. Pidgeon, whose name is mentioned in the correspondence. Associated with that firm was Alexander C. Buchanan, of 600 Elizabeth-street, engineer and supervisor to the woollen mills at Mount Gambier, and his -reference to the Government was Mr. Livingston, exmember of this House, who knew him at that place. Since this morning, I have made an investigation. I find that this is a very reputable firm, and I believe their expert to be a capable man. When I looked at the valuation, I found the reason for the silence to which I have referred, for the plant, machinery, fittings, buildings, and land were valued at £267,159. I draw honorable members’ attention to a remarkable fact. The plant, machinery, and fittings are valued at £191,609, whereas the valuation of the experts to whom I went was £185,000 - a close approximation. When I come to the buildings, however, I find a disparity ; and here I . emphasize the fact, that the expert of the firm employed by the Government is an engineering and not a building expert. The figures of this expert in regard to the machinery coincide with the figures of my experts, but there is a difference between the two valuations of the buildings. The valuation of the official expert for buildings, which in 1914 cost £91,000, was £73,050 ; whereas the expert to whom I went made his lowest computation £112,000. But I. shall accept the official valuation as a whole. The official expert values the land at £2,500; plant, machinery, and fittings, £191,609 15s. ; buildings, £73,050- a total of £267,159 15s. But, even accepting that valuation, the question is: What shall the property be sold for? It is a going concern, which, straightway will make profits for the new company; .and surely something must be allowed for profits, as in the case of a private concern; they would add goodwill. I should say that, certainly the net profits for the last two years should be taken into account; and if we add these profits - £103,311 - to the official independent valuation, the result is £370,470. A Sul]1 of 100 guineas was paid for the official valuation, about which nothing would have been said if the file, had not been demanded.
In the Senate last week Senator Guthrie said, “ The new company is a powerful one.” I believe it is, and honorable members will realize its strength later on. Senator Guthrie also. said that the company must earn interest on £300,000. Why ? . One of two things can happen; seeing that the company has such a “ good thing on,” they will either, write up their capital - that is, water the stock - or, delighted with their bargain, they will extend the business marvellously. Already the company has placed on order £25,000 worth of new machinery; a fact which shows that they are not very doleful about the deal they have made. I have taken into account what capital the company will actually require to carry on -the mill as it has been carried on during the last two or three years. The figures I have are not based on assumption or on estimates, but are taken from the actual experience of the mill. During the last two years the average capital required for stock and working capital was £127,000. What will the company require for plant and machinery? Only the deposit? Do honorable members know how much the deposit is? No doubt honorable members have seen in the press that a condition of the tender was the payment of one-third deposit, and they would naturally expect that it would be at least £51,000. They will be surprised to know, however, that it is only £15,500. If we add that deposit to the capital required for the working expenses of the mill, we have, from actual experience, an amount of £142,500 if it is proposed to work along the old lines. Of course, if the company extend their operations they will require more capital; but then they will make more profits. I take the average gross profits for the two years at £79,474. What are the annual charges against those profits? The instalments, £13,950; average interest on balance, £4,S50; taxes, (rates, insurance, &c, approximately £10,000; or a total of £28,000. If we deduct that from the actual gross profits of the last two years we are shown a clear profit of £50,674 per annum; meaning that, on the actual capital they require to carry on the mill, the company will “(receive a return of 35-& per. cent. Assuming that the company gave £400,000, my first figure, they could pay all charges and show a profit of 12£ per cent, per annum. According to the Minister for Defence, the book value of the property, as shown in the last balance-sheet, is £115,420. Why does he quote the book value? Does he suggest that it is a proper basis for sale? Would any honorable members opposite sell their private businesses on the book values shown in their balancesheets ? We should bear in mind the fact that this was a pre-war business, that the’ building is brick, with steel girders, concrete flooring, and that it is roofed with, iron, and 5 per cent, per annum has been written off since its erection except in Che first year, when the management wrote off 2 per cent. The machinery, plant, &c’.> has been written down by from 5 per cent, to 20 per cent, per annum. Buildings which cost £81,000 appear in the balance-sheet as being worth £56,643. On a proposition like’ this, it is obviously absurd to’ take the book value. Honorable members who are associated with business concerns know that they have only to turn to the” balance-sheet of any firm to realize that that is the place where they hide their accumulated profits in the form of reserves. No doubt they are aware that the Bank of Australasia is a most powerful institution, and I quote that as a concrete example of my argument. That bank has branches all over
Australia and New Zealand, with a head office in London, and yet the book value of the whole of its banking premises is set down at only £18,055. The land on which the Melbourne office is built is alone- worth more than that. Multiply that figure fifty times and you might get somewhere near the real value of those properties. But I am not quarrelling about that. It may be good . bookkeeping to keep on writing down the value of business premises, but it is not good business to sell on that basis. That is the point. If the Prime Minister offered his Flinders-lane business for sale on book values, he would probably find some enterprizing firm, as in the case of the Geelong Woollen Mill, prepared to step in and close the deal. Will he say that this transaction may be regarded as a precedent? Will he say that another Government with some regard for the rights of the people and not of the profiteers would be justified in resuming private properties on the book values as shown on their balance-sheets? Of course the Prime Minister would not agree with that proposition. Neither do I say it would be fair. The party I represent does not stand for robbery or confiscation. We are out to stop it. But I will say this, and do .so with the authority of our party, that when we get back to power, we shall feel justified in resuming the mill from the purchasers on the same basis of value as that on which they were sold. Honorable members have only to look at the statement as I have presented it to realize that if the management of the mill had written down for depreciation at the same rate for eight years more, there would be no book value at all. Would they then give the mill away ? On their own reasoning they ought to, but naturally they would not do that. If this Flinders-lane Government can seize the people’s property at book value, then any other Government would be entitled to seize the Flinders-lane property at the same basis of value.
What do the Government say by way of justification for this extraordinary transaction ? They say that you cannot always obtain full value for property when you offer it for sale. Quite true. You may bring a horse worth £100 to market, and get a bid of -only £50. In those circumstances you take him home again. Similarly, if a man submits a house for sale by auction, and bidding does not reach his reserve, it is withdrawn from sale if - and in this case there is an important “ if “ - it is not a forced sale. If a mortgagee forecloses, the mortgagor must take what he can get. Was the sale of the Geelong Mill a forced transaction ?
Mr McGrath:
– Yes. Flinders-lane made it a forced sale.
Mr SCULLIN:
– I think it was a forced sale, and again I quote the statement made by the Postmaster-General (Mr* Gibson), who said that the Nationalist party drew colossal fighting funds from the manufacturers and Flinders-lane. It appears that the bill is falling due, and that this sale was forced as payment for the colossal fighting fund received by Ministerialists. Those who supplied the money are now getting back their investment, with dividends added, in respect of all they had put into the election fund. This transaction is what I would describe as a compulsory purchase of public property on the buyer’s terms.
The Government have offered some excuses for this transaction, and I want to examine them. The ex-Minister for Defence (Mr. Massy Greene), who was defeated at the last, election, in aoa attempt to justify the proposed sale of the mills simply made certain general statements against the policy of nationalization, and quoted the losses on the cattle stations, owned by the Queensland Government. He omitted to mention, at the same time, that every other cattle station in Queensland was losing money, and that, at about the time he spoke, the Queensland cattle kings were down in Melbourne pleading for a subsidy from the last Government, and got it. He said nothing about that at all. What happened then suggests that when private enterprise suffers losses the public have to pay, and when it makes profits they have to pay more.
Another excuse offered for the sale of the mills is that the Government did not wish to compete with the returned soldiers, who own and operate a mill at Geelong. All I can say in answer to that is that the syndicate that bought the mill will have no tender feeling for the returned soldiers in competition with them. The Prime Minister stated, also, that if the Government retained the mills further expense would be necessary for the purchase of new machinery in order to manufacture worsted and fancy tweeds, and : that they did not feel justified in incurring that expenditure. This proposition was made in 1920, and the sum necessary for the machinery was on the Estimates in 1921. On the figures I have given the new machinery would have been paid for out of the extra profits earned in one year, so it would not have been unwise -expenditure. Surely in times like the present, when we are burdened with debt, it is good business for a Government to invest money if it can be returned in one or two years. Still another excuse offered was that there was not sufficient Government work to keep the mills fully occupied. I admit that, and my answer is that the Government could have disposed of any surplus manufacture to the public at a profit. But this was against the Government policy. The Government decline to compete with private enterprise. That was their real and their only reason for the sale of . the mills.
I could afford to let my case rest on the statements I have submitted to honorable members, and allow the Government to be judged on their policy and lack of business ability. I would’ be glad to let my case rest there, but public men frequently have unpleasant duties to perform. The public demand the whole story, and I intend to give the facts. This sacrifice of the people’s property, as an offering to Mammon, is not only open to criticism, but to gravesuspicion, as sinister methods have been employed in carrying it out. I am reminded of a very sensational report, which appeared in the Age on 27th October, 1922, of the proceedings at a meeting of the Nationalist Union held on the 25th October, 1922. It reads-
The inner circles of the masters of finance “had met to raise funds for the Nationalist party’s Federal campaign….. The National Union is the head and front of the money power. It receives fabulous cheques from shipping, ‘pastoral, commercial, and financial concerns, and in dark secrecy it allocates the money to branches of the Nationalist party….. Mr. Bruce was the lion of the gathering. His connexion with Flinderslane is sufficient to guarantee him a cordial welcome at all such conventions. Mr. Bruce impressed on the meeting that they had everything to gain by clinging to the Nationalist party.
The Nationalist Union referred to is still behind this Government. The following day a significant letter, signed an “ exNationalist,” appeared, of which’ I would take no notice as it was written under a nom de plume, but as a big cheque accompanied it it is worthy of attention. It reads -
Like many other employers, we have regularly subscribed to the fighting fund of the National Federation. We now see that the National Union has made it possible for a few financiers (perhaps our business rivals) to secure, through political influence, most distinct business advantages and concessions. We enclose our cheque for twenty-five guineas for the Liberal Union.
The editor’s footnote indicates that the cheque was received, and was forwarded to Mr. F. E. Dixon, the treasurer of the Liberal Union. The unscrupulous methods of big business men are well known. What are the incidents which arise , in the minds of honorable members? I can recall light weight coal sold by a prominent Melbourne firm for use by the Navy during the war, decomposed meat disposed of for use by soldiers, and the case of a gang of thieves who despatched rotten wheat and flour to South Africa. We can also recollect the coffin ships built by an Australian firm, the contractors for which the Government should put into the dock for imperilling the lives of those who go down to the sea in ships. These are only a few instances. There were the actions of the profiteers and manufacturing cormorants of Flinders-lane who, during the war, displayed bunting from one end of the street to the other, and at the same time robbed the community. Of course, they were great Imperialists and patriots. Who was a greater patriot and who barracked louder for Empire than Horatio Bottomley?
Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP
– He got his deserts.
Mr SCULLIN:
– He gotwhat he deserved. These people who robbed the community wrapped a flag around themselves to conceal their plunder, and smothered the people’s protests (by singing the National Anthem. No wonder the exPrime Minister, in the early days of the war, said that some of these patriots would give £50 to a patriotic fund and at the same time rob the people of . £500. The Government are handling public property in the interests, not of the people, but of the profiteers. No one knows their methods better than tho present Prime Minister, who was trained amongst them, and one would expect him, if he has the interests of the country at heart, to take every precaution. Does he not think that every precaution was necessary? If we examine the methods employed we find that there has been most amazing indiscretion, and some of the actions of the Government are open to even grave suspicion. For the valuation I have mentioned the Government paid 105 guineas, but they did not act on the advice received. They kept it in the background. They did more than that; the Minister who had charge of the sale of this property actually consulted with one of the buyers while the transaction was pending. He showed him the highest tender. The gentleman to whom I refer is Senator Guthrie, a supporter of this Government, who is a member of the syndicate. The Minister knew he was a prospective buyer, because Senator Guthrie, speaking in the Senate on the 15th September last, said -
I am one of a syndicate that intend to tender. … I have faith in the wool industry. The possibilities are immense.
Senator Guthrie is also associated with FlindersLane interests, the Stawell woollen mills, the Daylesford mills, the Lincoln mills at Coburg, and Dalgety and Company. The same gentleman, speaking in the Senate on the 13th June, 1923, in relation to the history of the sale of the mills, said -
Tenders were returnable on 3rd October, 1922. The highest offer received was ?130,000. . . I happened to know this because the Honorable Massy Greene . . . asked me whether the Government should accept the tender. 1 replied, “Emphatically, No.” Mr. Greene then said, “ Well, the Government cannot carry on the mills. . . . It is not the policy of the Government to engage in trade, and I would like to ask you what you think we ought to do?” . . . My answer was . . “ Call for fresh tenders.” My advice was accepted.
The Minister consulted Senator Guthrie and accepted his advice. Senator Guthrie said . that he was a small shareholder, as he held only 2,000 shares at ?1 each, but I notice that the name of Arthur D. Guthrie appears in the list, and probably we will discover’ later that Senator Guthrie has a greater interest in the undertaking than he led us to suppose. . Returned soldiers are controlling a woollen mill at Geelong, and in order to raise, the necessary capital 100,000 shares at ?1 each were issued. Many returned men handed in their gratuity bonds to assist the venture, and are doing well. The members of the returned soldiers’ syndicate wished to extend their operations, and as they were anxious to purchase the Geelong mills they approached the Government and pointed out that, although they had not sufficient cash, they could float a company with a capital of ?250,000. They informed the Government that they had not the required deposit, but asked if the Government would take their existing mill at Geelong as security. What was the decision? The Government said that in terms of the tender they would have to pay down a deposit of one-third, plus ?25,000 deposit on stock. The value of the security offered was ?57,000, and the Government said the offer could not be accepted. The Government profess to give preference to soldiers; and perhaps they do, when a labourer’s job is vacant. They accepted, by secret arrangement with a private syndicate, a deposit of ?15,500 on the plant and ?25,000 on the stock, making ?40,500, although ?57,000 from the soldiers was said to be inadequate.. I do not wish to misrepresent the position. It is true that while the new company was to put down a deposit of only ?15,500 on the plant, it was required within a month to pay the whole cash price of the stock when it was assessed, possibly at a value of ?70,000- or ?80,000. But the point is that if the soldiers had been given a little time, and had been granted permission to submit their mill as a deposit, they would have floated a company and’ paid cash for the lot. However, fresh tenders were called, and the highest submitted was signed by Mr. James Dyer on behalf of about a score of persons. The price was ?150,000. The Munitions Board reported that in his tender Mr. Dyer had asked that he should be allowed to put down a deposit of one-fifth instead of onethird. Commenting on this point, the Board said that this was not a very serious’ matter, provided the syndicate paid 6 per cent, on the balance. Further on they declared that it would be reasonable to expect ?200,000 for the buildings and plant. The Prime Minister minuted this report on the 13th February, 1923, as follows : -
Negotiate with Dyer to obtain an increase, and if not, accept on best terms.
That is to say, “ throw it away at any price.” Negotiations were carried on, and, although the conditions advertised in the press in Australia, New Zealand, and Great Britain were that a deposit of one-third should be put down almost immediately, and that the balance should be paid in five years, carrying interest at the rate of 6 per cent., by private arrangement with Mr. James Dyer and his syndicate the Government accepted a. deposit of one-tenth - not even the onefifth that was offered - and agreed that the balance should be paid over ten years, instead of five years, and should carry interest at 51/2 per cent., instead of 6 per cent. It must be said in the Government’s favour that they secured an increase of £5,000 in the price to be paid, making the total £155,000 ; but seeing that the1/2 per cent, reduction in the rate of interest spread over a period of ten years is almost equivalent to the increase of £5,000 in the price, it does not say much for the business capacity of the Government. As a matter of fact, the annual payments, which will be £13,950, are a good deal less than the amount annually written off by the Government for depreciation on the buildings and plant. In all public tendering it is considered vital that any alteration in the tender conditions should be made known to every tenderer, andI contend therefore that when the Government saw fit to make the terms easier they should have called for fresh tenders.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– The soldiers would have got the mills then.
Mr SCULLIN:
– They would not have had much trouble in doing so. It can be readily understood that very few persons could raise the huge sum of money the Government required, and that the easier the terms were made by reducing the rate of iuterest payable the larger would be the competition from buyers. I believe that if fresh tenders had been called, with the new conditions laid down, there would have been thirty instead of three offers.
There is another phase of this question which requires explanation. The tender conditions provided that for the purpose of valuing the stock in hand - wool in process of being spun, material on the looms being woven, and dyes - two valuers should be appointed, one by the successful tenderer, and one by the Government. The Munitions Board, after going through a list of names suggested to them, which were those of the gentlemen who comprised the Wool Appraisement Tribunal, recommended that Mr. Denison, who had been the sellers’ expert on that tribunal, should be appointed by the Government. I presume they realized that one who” had been in the habit of selling wool was likely to be a good man to represent the interests of the Government, who, on this occasion, were the sellers. I find, however, on going through the papers, that after a telephone conversation, the nature of which, of course, I could not gather, this recommendation was not accepted, and that on a minute signed E. K. Bowden a Mr. George Kettlewell, of 30 Wool Exchange, Melbourne, was appointed. This gentleman had been representing the buyers on the Wool Appraisement Tribunal. He has been given as an expert assistant, Mr. Hudspeth, of the Lincoln Knitting and Spinning Mills. I know neither of these gentlemen. They may be experts, they may not be; they may be most reliable men, they may not be; but the fact remains that Mr. George Kettlewell is a co-director with Senator Guthrie on the board of directors of the Lincoln Knitting and Spinning Mills, that the expert appointed to assist him is presumably an employee of those mills, and that Senator Guthrie is one of the purchasing syndicate and, if the truth be known, organized it. The position is that Senator Guthrie’s co-director of the Lincoln Mills has been appointed by the Commonwealth Government to estimate how much should be paid to the Commonwealth by Senator Guthrie and his syndicate. The task of valuing stock worth £70,000 or . £80,000 is a delicate one. It may be an easy matter to appraise the value of wool in bales, and even in doing so there are many disputes, as every one knows, but there must be a lot of give and take in the operation of valuing woollen cloth in the process of manufacture. Surely a Government, watchful of the interests of the country, should have known those with whom the gentleman appointed to -act on its behalf’ waa associated. Indeed, there was something on the files which should have warned them. The Lincoln Mills wrote to the Department asking for particulars and tender forms. It suggested that they, or some one connected with them, proposed to submit a tender. But despite this warning, the Government turned down the recommendation of the Munitions Board that the expert representative of the wool sellers on the Wool Appraisement Board should be. appointed to watch the interests of the Government, and they appointed as their valuer the gentleman who had represented the buyers on that Board, and who was closely associated with the purchasers of the mill. It is very suggestive of the wireless scandal that was exposed in this Parliament last year.
Last week I addressed a question to the Prime Minister, and obtained exactly the answer I expected. I asked -
What is the status of Mr. Alexander Russell in the Prime Minister’s Department; who appointed him; what salary does- he receive; and who pays ‘him?
Honorable .members opposite, including the Prime Minister, evidently thought the reply was a crusher. There was loud applause, and one inane interjection. The answer given by the Prime Minister was as follows : -
Mr. Alexander Russell is not in the Prime Minister’s Department; he does not receive any official salary; and he lias no Government duties at nil.
I read in Smith’s Weekly of 16th June the following : -
A letter was addressed to Mr. Bruce ‘by a Sydney man. He received a reply signed, “ Broad, Private Secretary.” His next attempt met with a brief acknowledgment, signed, “ Mellor, Private Secretary.” He then pressed for an interview, and was put off by “ Russell, Private Secretary.” He is now composing a fifth epistle, and will be terribly disappointed if he does not collect a different signature altogether.
The Sydney Bulletin of 24th April announced that -
Mr. Alexander Russell, son of Western District Philip. Russell, will accompany the Prime Minister to the Imperial Conference.
Last week’s issue of that journal stated -
Alexander Russell, who is to be confidential unofficial secretary to Prime Minister Bruce at the Imperial Conference is a fellow ‘member of the Melbourne Club, and the Prime Minister’s golfing partner. Having been comfortably provided for by his rich .father, Russell studies public affairs between golf and bridge. He has been given accommodation at the Prime Minister’s Department.
Mr Yates:
– Does he have access to public documents?
Mr SCULLIN:
– He is in a confidential position, but he has no responsibility. The Prime Minister states that this man attends to his private affairs. I suggest that he attends to the semi-private and semi-public affairs of the Prime Minister, and that he is in a confidential position. I learn that Mr. Philip Russell is a rich squatter in the Western District of Victoria, and a large investor, who is one of the lucky syndicate that purchased the woollen mills. He is evidently one of the few who “ backed a winner.” I wonder if he obtained a tip from the training stable. The Government says it will not compete with private enterprise. That is its sole justification for all its actions. It puts that forth as an article of faith, as a shining virtue, yet we read in the GovernorGeneral’s Speech that the Commonwealth Shipping Line is to be conducted as .a competitive enterprise. Does the Ministry mean that? No. But the Country party having betrayed the farmers, the Ministry will be careful not to go too far. The farmers know that it is better to bear losses on the shipping line than the profits of the private shipping Combine. As a compromise, therefore, the Government decides to throw to the greedy wolves of finance the rich and juicy meal of the woollen mills. I read a, statement in the press recently to the effect that the Labour party was. angry because of the sale of those mills. I admit it; we are angry, because we are sincere on the question. If we were not sincere we would be glad of the political advantage the action of the Government will give us. If seventeen seats were lost to the party opposite at the last election, there will be more losses on the next occasion in consequence of the present Government’s action in selling the mill. Where is the Country’ party that was to purify public life by the fresh breath of the fields and pastures? The Treasurer (Dr.. Earle Page), in a famous speech at Ballarat, stated that the Country party members were the watchdogs of public life, and in a beautiful bit of mixed metaphor, he told how those watchdogs had switched on the light and made the burglars drop the loot. Where are those watchdogs now, and what are they doing ? They are dumb dogs now. They have been well disciplined since they took their stand behind this Government. They claim to have retained their identity, but they have certainly lost their speech.
We hear sneering remarks concerning Labour’s ideals. Even if they were visionary, they are high and not sordid ideals. They are calculated to uplift «our fellow men. They are not aimed at keeping the course clear for the money-masters and their little clique. If the Labour party’s ideals are dreams and visions, they are at least noble and unselfish. There has never been a £25,000 gratuity awarded to a member of our party for being on the Labour side in politics. We put the people first, and they have no thousands to throw away. We contend that the interests of the whole of the’ citizens of this country should be our first consideration. Surely the people are entitled to a share in the bounties of nature and the joys of life. The government of Australia must not be conducted on the principle of keeping the course clear for the handful of individuals who control millions. Through all the transactions connected with the sale of the woollen mills there is one compensation. The hidden hand behind the Government has been forced into the open. The Government has been compelled to say that the sale has not been effected because of loss entailed in the running of the mills or because of inefficiency. The management of the concern has been beyond criticism, and the staff has worked admirably. Profits have been made, and cheap cloth turned out. The Ministry has been forced to say that this efficient and profitable undertaking must go because the present Government will not stand for the people. It is a staggering admission and a brazen declaration of the policy of this Government. There are to be no profits for the people; the profits are to be for the few. We have a Government acting for the profiteers of this country. It pretends to have concern for the people’s pockets, and now it has revealed itself shamelessly as having concern only for the privateers’ and the profiteers’ party. That these mills made a profit was their one great crime. Cheap cloth in competition with the privateers was their cardinal sin, and Flinders-lane condemned them on that account. “ This splendid public utility, built up by a wise and prudent Labour Government, which was prompted by a desire to serve public and not party interests, is squandered by the present Government, and is scrambled for by the political supporters of honorable members opposite. If Ministers were the directors of a private company, and handled the shareholders’ property in the same manner, they would be called before the Courts and indicted.
Mr Coleman:
– A criminal conspiracy !
Mr SCULLIN:
– The mills belong to the people of Australia, who were the shareholders, and before those expropriated shareholders the Government will one day stand. That will be the grand jury that will indict this Government. When it does stand before that jury it will certainly be condemned.
Mr BRUCE:
Prime Minister · Flinders · NAT
– Honorable members on this side of the House have listened to the remarks of the honorable member for Yarra (Mr. Scullin) with, I think, a considerable amount of interest. We have heard him flinging charges at everybody, in every direction. He has suggested conspiracy, hidden hands, money powers, and such other things as are employed by members pf the Opposition to reflect upon the honour, the decency, and the good intentions of a Government that is opposed to them. It has been suggested that I, because I came into the Government about two years ago, was responsible for the decision to sell the woollen mill. The honorable member knows that that suggestion is quite untrue. I had nothing to do with -the sale of the mill, other than to cast my vote, in accordance with a principle in which I believe, in favour of its sale. The honorable member has said that there is a direct issue between us, and I believe there is. I cast my vote for the sale of the mill because I do not believe in Governments running trading ventures, and honorable members on this side of the House share that view. My honorable friend need have no fear that we shall try to shirk that issue. I shall deal with his statements regarding the mill and its profits, but before coming to that aspect of the question, I wish to indicate my view that it is very undesirable, when a political issue arises, ‘that honorable members opposite should try to bespatter -with mud those who are opposed to them, and should suggest almost criminal motives for whatever action may have been taken. The honorable member ha3 not hesitated to suggest that sinister motives actuate me in everything I do. I sold the woollen mill, he alleges, because the sale of it would benefit and profit me. I ask the honorable member to analyze the position. How on earth could the sale of the woollen mill help me? It did not matter in the least to the business which J was conducting before I joined the Government whether the mill was continued or not. It was not of the slightest pecuniary interest to me. Its activities could neither hurt myself nor any business that I was interested in. The honorable member has also suggested that there has been some sinister collusion with Senator Guthrie. It is conceded, I think, by all who know Senator Guthrie, that he has the interests of Australia at heart, and is a perfectly upright and honorable man. Insinuations have been flung at him, and also at Mr. Philip Russell. The connecting link with Mr. Philip Russell was a little difficult to find, but it was discovered by reason of the fact that his son acts as my confidential secretary - he was termed a confidential secretary, but he is purely a personal secretary, who docs personal work for me now that I carry the burden of the office of Prime Minister. That fact, however, is sufficient to enable the honorable member to say that sinister work is being done, and that there is a great conspiracy by certain moneyed classes to force their will upon, the Government, and to take from the people a valuable asset at a quite improper price. I propose to deal with the figure’s which the honorable member has given, but before I do so I- want to put forward” my view, which is also the view, I believe, of every decent thinking person, that when a matter of this sort has to be discussed, it is regrettable that improper motives should be imputed, and assertions made that there is a conspiracy to deprive the people of their rights. The statement is absurd, a? everybody knows, and it, is only those people, whom the honorable member can get to listen to him when he pours out these vilifications, that have the slightest belief in what he says. Those who can weigh and consider the facts know that the allegations are totally untrue.
The statements of fact which the honorable member has made I propose to take in their due order and sequence. The first point is the issue between the Government and honorable members opposite. We say that we do not believe in trading ventur.es by the Government as being the right way to conduct the affairs of this country. Honorable members opposite take a very different view; they believe in the nationalization of industry, production, distribution, exchange, and other things, and it is only natural that they should resent the sale of the woollen mill. Members of the Opposition have told the people that they want the Government to run trading ventures of this sort. I offer no complaint against the protests that have been uttered and the determination of members of the Opposition to try to prevent us carrying out the policy in which we believe, and with which they totally disagree. My complaint is that it is felt necessary to add suggestions of sinister motives and sinister, …1-lip. ‘.I would point out to honorable members opposite that the view they now take that the mill should carry its operations into the field of catering for private trade, is not consistent with the purpose for which the mill was created. The object of Labour in those days was very different. I recognise that, situated as they are to-day, members of the Opposition take a different view from that taken by those who founded the mill. They now hold very different ideas from those which they formerly entertained of what should constitute the functions of Government. The mill was established with the sole object of supplying the needs of- the Government. I would remind them of the particular class of Government requirements it was designed to meet, namely, the supply of uniforms for the army and navy. In those days the Labour party took a very different view of defence also from that which it takes to-day. The Labour Government pledged itself to a compulsory national training scheme, and it was to supply uniforms for the soldiers and sailors who were being trained that the mill was primarily established. Speaking at the opening of the mill in December, 1915, Senator Pearce - who is a member of the present Government, but was then a member of a Labour Government, and stood for Labour and the views it then represented - Said the mill was intended to provide the soldiers and sailors with uniforms and clothing during the war, and when the war was over it was to provide uniforms for the Citizen Forces, the Naval Forces, and the postal employees. There is no suggestion in that statement that this mill was being established as a Government trading enterprise to compete with other mills, and make profits for the Government. That is a new idea, which has arisen with the advocacy of the nationalization of industry and everything else. But the conditions now existing render the mill unnecessary for the uses for which it was originally designed. As the result of the Washington Conference, a great reduction has taken place in the Defence Forces, and compulsory training has been greatly curtailed. We have not to provide as many uniforms as formerly, and the mill cannot continue manufacturing the ordinary Government supplies which it was primarily intended to produce. The Government having decided that it was not part of the functions of the Commonwealth to trade and dispose of the factory’s product in the ordinary markets, the whole position had to be investigated and reviewed. It was found that for various causes there was not the same demand from Government institutions for cloth from this mill as there had been in the past. The mill had been supplying a great deal of the requirements of State Governments; but, rightly or wrongly, they decided that they would not continue to get their supplies from the Commonwealth Mill while there were mills working within their own borders which were paying income tax to the State authority. That decision by the State Governments reduced the output from the mill which could be disposed of. Further, the requirements of the returned soldiers were falling off very rapidly. The Commonwealth ‘ had been manufacturing cloth for soldiers, firstly, to supply them with civilian clothes on their return from the war, and, secondly, to enable returned soldiers and their depen- dants to obtain cloth from the mill at a fixed price. That demand was falling off,, and the result of that combination of circumstances was that from the 30th June, 1922, the mill had only three months’ work in sight, unless we were prepared to sell cloth to the trade in the ordinary way, as if the mill were an ordinary trading concern. The Government decided not to adopt that policy. Before explaining the reasons for our attitude, I wish to clear up the statement frequently made that by disposing of the mill we would deprive the soldiers of the privilege of obtaining cheap cloth. The figures of output disprove, that, statement. During the fifteen months between March, 1920, and June., 1921, the soldiers’ associations undertook to distribute through their various branches 640,000 yards of cloth. The deliveries to them in that period totalled 569,000 yards. It is true that they were not taking the full quantity they had ordered, hut they were taking in some months nearly 50,000 yards. After July,. 1921, the supply fell off very materially! The second contract entered into covered the twelve months from July, 1921, and was for only 15,000 yards a month. The monthly deliveries during that period reached 15,000 yards twice only, and once declined to 2,700 yards. Thus, instead of taking 180,000 yards under the second contract, the soldiers requisitioned only 123,000 yards. For the first six months of the current financial year they contracted to take 69,000 yards, or a little more than 11,000 yards a month. They found that they could not absorb that quantity, and the order was accordingly spread over the full year, representing a delivery of 5,000 yards a month. Honorable members will thus see that the demand for the supply of cloth for returned soldiers had practically ceased. There is consequently nothing in the complaint that returned soldiers are being penalized through the shutting’ off of this source of supply. I stated earlier that, in June, 1922, there was only three months’ work in sight for the factory. If we were not . opposed to the policy of carrying on Government trading institutions, we could have decided to continue the operations of the mill, and dispose of the cloth to the general public. If honorable members opposite had been in power they would have continued the Commonwealth control of the mill for the purpose of supplying cheap cloth to the people, and they would not have consented to the distribution of supplies through Flinders-lane, of which we have heard so much this afternoon . If they refrained from employing the ordinary distributing agencies, the mill would inevitably have to create its own. distributing agencies. But a Commonwealth Woollen Mill- could not be conducted solely for the benefit of the people of Victoria. Do honorable members opposite realize what would be the cost of establishing distributing agencies to give equal opportunity to the people all over Australia to obtain the benefit of the cloth produced by the Commonwealth Factory? Such organization would absorb the whole of the profits upon which the honorable member for Yarra has laid such emphasis. Honorable members opposite would have been quite determined not to sell cloth to Flinders-lane, which is the obvious means of distribution-
Mr Scullin:
– But we would have sold to the tailors and drapers direct.
Mr BRUCE:
– They would have been quite prepared to sell direct to the retail trade. Again I remind honorable members that unless they intended to sell to only a few people in Victoria they would have been obliged to establish a large distributing agency to supply people elsewhere in the Commonwealth, and the profits of the mill would consequently have disappeared. A Labour Government would have taken a pride in conducting the mill efficiently and profitably. They would have immediately opened the mill to any buyers, and the custom which would make the transactions simple and safe would be that of the big retailers in Sydney t and Melbourne. Perhaps for a few months, in their enthusiasm for their new venture, honorable members opposite would say, “ It is the small tailor we are going to supply.” After a time,’ it would be borne in upon them that there is no more dangerous account for any woollen mill to carry than that of the small retail tailor; it is a precarious trade, and the problem of bad debts would immediately arise. Very soon honorable members would find that they had good markets in which to sell, being absolutely certain that they would get their money without having any big bad debt losses ; and this trade would fall into the hands of the big retail distributor. I do not think that honorable members have very much more affection and sympathy for the big retailer than they have for the big wholesaler. That is the problem the Government realized it would have been faced with had it gone on - that is, how to distribute the output from the woollen mills except through the ordinary channel of Flinders-lane; in other words, failing that, in what manner it was going to arrange to do its own distributing. Honorable members opposite appear to be amazingly ignorant regarding the question of distribution. Australia ,is extraordinarily great in extent, -.and we have to try to provide for the people “ in the back-blocks the same facilities that are enjoyed by the people in the towns. The only way in which you can do that, when you have great mills in centres like Geelong and other great manufactories concentrated in the cities, is to have some factor by which the products of a whole trade can be distributed cheaply and . efficiently. Honorable members would not listen to me if I asserted that the great distributing houses of Australia are rendering a very considerable service, and are not taking extortionate profits. They need not accept that statement. Even though Flinders-lane and the other places which honorable members refer to, were making the extortionate profits which they imagine are being- made, it would not be possible for a mill of this character to run its own distributing agency nearly as cheaply. That is the position which honorable members have to face. We have faced it, and we have come to the decision to dispose of this mill, because we do- not consider that it is one of our functions to carry on a great manufacturing business - which this would be. Even if we desired to carry on this mill in order that the people of Australia .might obtain their products direct from it, it would be impossible to carry it on in the way suggested by honorable members opposite. That is the attitude which they will adopt when they are intrusted with the task of governing this country - if they ever are - and are faced with the same problem. The Government has never said, and it never will say, that where it is necessary to manufacture for the requirements of the Government Itself, it is improper to carry on a manufacturing business. To-day we have the printing office j we do not go outside to have our printing done. There are other businesses which the Government has to run because it needs them for its own requirements. But in a case such as this is, in which we would be carrying on an enterprise for the purpose of supplying our requirements for portion only of the year, filling the role of an ordinary trader during the remainder of the year, we say that that is quite an improper position for a Government to be in.
Mr Fenton:
– According to that argument, you will sell the shipping line.
Mr BRUCE:
– One of the reasons why the Commonwealth Shipping Line is being carried on, is that a large number of people in this country are quite clearly of the belief that freights between here and Britain are of paramount importance to Australia, and they are of the opinion that Australia will be safeguarded if that line is carried on. Unfortunately the majority of the people do not share the honorable member’s view in regard to woollen mills.
Mr Fenton:
– They do.
Mr BRUCE:
– We had an election recently. The honorable member for Yarra (Mr. Scullin) has stated that seventeen members who voted against his motion were defeated. The honorable member is nattering himself if he thinks that that is the reason for their defeat. Forty-six members were returned to this side of the House who hold the opposite view.
Let us deal with the question of how we are going to effect the sale of this mill. The decision was arrived at in June, 1922, that the mill should be sold. Tenders were invited in Australia, New Zealand, and the United Kingdom. Advices were sent also to America. At the same time speeches were made in this House and in another Chamber in which the merits of the mill were extolled, the profits it had made were plainly stated, and it was given the best advertisement it was possible to give any property that was being offered for sale. I think that everybody imagined there was going to be a rush to secure this mill. My view was that there would be the very keenest competition. I thought that we would have offers from Great Britain, and probably from all parts of Australia. I rather - hoped that we would have
America trying to get possession of this mill. Apparently we were wrong ; because we did not get those offers. The tenders closed in October, 1922, and the highest offer was £130,000.
Mr Mathews:
– Was that for buildings and machinery only, or did it include stock?
Mr BRUCE:
– Stock was not included. My honorable friend (Mr. Scullin) has said that “this was a great prize which was being thrown to somebody. He also has made a number of remarks regarding the astuteness of business men; he has told us of their machinations to enable them to obtain the last ounce of profit, and he has pointed out that here was their opportunity to secure something worth while. I ask him, Why did they not grasp the opportunity ? Of course, he will say - “ Because ‘ big business ‘ works hand in hand, and ‘big business ‘ saw to it that the field was clear, and that no one could come in.” But does the honorable member suggest that “ big ‘business “ in Australia is so powerful that a small syndicate, composed solely of Australians - men of considerable repute I agree, but certainly not dominating spirits of world finance -could stop the great moneyed interests of Great Britain and America from rushing in and snapping up this prize which he has painted to-night in such alluring colours? The suggestion is perfectly absurd. No one but a person whose whole vision was clouded with suspicion, and with that intolerance which the honorable member possesses in so marked a degree, could see the position as he has tried to present it. When charges of this sort are flung about, and all sorts of suggestions are made against people, one is inclined to think that there is something in the view that what a ma,n expects of other people is rather a reflex of his own mind, and what he himself would do. It needs a mind such as that of the honorable member for Yarra to conceive all that he has suggested to-day1.
If this woollen mill were such a prize as has been suggested to-day, how is it that ia response to advertisements throughout the world inviting tenders for its purchase no one would offer more than £130,000 for it? The Government considered the situation, and came to the conclusion that the price offered was not sufficient. We therefore made a further attempt to obtain a better price. Fresh tenders were invited by advertisement, and on this occasion we received an offer of £150,000. All aspects of the case were taken into consideration by the Government, and, after full investigation, we came to the decision, indicated by my honorable friend, that we would accept £150,000 for the mill if no better price were obtainable, but that the Board should be instructed to see if it could not obtain a little more. The result of the Board’s effort was that the tender price was raised from £150,000 to £155,000. That offer was accepted, and a basis of payment was arrived at by which £15,500 was paid by way of deposit, and an agreement entered into that the whole of the stock should be paid for within one month of the purchaser taking possession. The result is that the Government obtains straight away something in- the region of £100,000. I frankly admit that we were disappointed with the offer. “We anticipated obtaining more for the mill, but were, faced with the hard, cold fact that after all our efforts had been exhausted the best price that any intending purchaser was prepared to offer was £155,000. Being convinced that we had no hope of getting more the offer was accepted.
I desire to put the facts before honorable members opposite. The honorable member for Yarra has dealt with the x matter at great length, but the position with regard to the mill - and we had to consider all these points - was that the original cost . of purchase, erection, and installation of all mill buildings and plant was £204,708. From this amount there had been written off on account of depreciation, £89,288, leaving a book value, as at- 1st July, 1922, of £115,420. We had to add to this £2,500 as the value of the land - a gift from the Geelong Harbor Trust - as well as £4,000 in respect of plant on order from England on 1st July, 1922, and since delivered, making a total book value, of the assets that we handed over, of £121,920. This then was the book value of the property. The only point to be taken into consideration was as to the price which the Government would actually have to obtain in order that there should be no loss on the transaction. That point is a little more relevant than the honorable member for Yarra appears to appre ciate. When a man is trying to sell a business, and is faced with the conviction that it is very doubtful whether, if he continued to carry it on, it would maintain the results it had shown in the past, he takes every step he can to obtain the best possible price for it, and then, having exhausted all the possibilities, he considers what would be the effect upon himself if he got out at the price offered. That, as the honorable member for Yarra knows as well as I do, is the ordinary course followed by every business man. The result of such a consideration in this case is to show that the Government, by selling this enterprise at £155,000, can get out of it without making a loss upon the whole transaction. In fact, at such a price, the transaction shows a profitOne is very reluctant to sell a business or enterprise when one thinks that it ought to bring more than is offered; but I ask honorable members opposite what more we could have done than advertise as we did from practically one end of the world to the other for tenders for the purchase of this mill. o
Mr Scullin:
– The Government should have advertised the changed conditions.
Mr BRUCE:
– I shall deal with that point. We gave those who wanted to come in and acquire the property every opportunity to do so. As honorable members are aware, every proposal to dispose of Government property must be carefully considered by the Government, and this is the first time I have heard it said that a Government is not taking a proper course when it invites people, by public advertisement, to submit a tender, for something that it has to sell, and accepts the highest price that is offered. We did that, and no one could have done more. Many statements have been made by the Opposition with regard to the terms, but I ask them to appreciate the actual position. We were faced with the difficulty of getting rid of this mill. We had twice advertised it for sale. Do honorable members opposite appreciate what would have been the effect of advertising a third time for tenders? Does it not occur to them that had we done so, those who were likely to buy would have realized that the Government found it difficult to dispose of the mill, and, so far from increasing their original offer, would probably have reduced it? One can say with confidence that had we for the third time invited fresh tenders we should, probably have been faced with an offer below that -which we actually accepted. Any man who has had any experience in trying to sell a property of this character must know that perfectly well. The honorable member for Yarra has been trying to suggest that there is something sinister or improper about the sale of this mill, but it is obvious that we exhausted every possible means of disposing of the property before we let it go. There have been suggestions that we should have sold the mill to the returned soldiers who have established a mill in Geelong. Let me make that aspect of the matter quite clear. The offer of the returned soldiers was made when tenders were first invited, but there was no offer from them on the second occasion when tenders were called. When they approached us to purchase the mill the Government, after very careful consideration of the whole position, came to the o conclusion that they could’ not accept the proposals that the returned soldiers put forward. An important factor in the matter appears to have ‘been overlooked. The property which the returned soldiers hold at Geelong has been to a great extent financed by the Government, and their proposal for the purchase of the mill involved a request to the Government to take a property, upon which we already had a very heavy mortgage, as a deposit for the purchase of another property. Another consideration influenced the Government in their decision very much. ‘They examined the position very closely, and no doubt was left in their minds that if the returned, soldiers had attempted to carry out what they suggested, they would be embarking upon a hazardous enterprise, and would be very fortunate indeed if- they did not lose the whole of the money they put into it. It was with a view to protecting the interests of these returned soldiers, as much as anything else, that the Government refused to vary the conditions or delay the sale of the property in order that their proposal might be accepted. The question of profits turns upon a matter of very great importance, the consideration whether the Government, ‘by adopting the course which has been suggested, or withdrawing the mill from sale and continuing to carry it On, would be likely to be able to do so at a profit, and eventually, should a sale be considered desirable, to sell ‘ on better terms than those offering at the moment. The position with regard to profits is as follows: The mill commenced operations at the latter end of 1915, and the profits earned over the various years were:- 1916-17, £22,414; 1917-18, £15,654; 1918-19, £22,689; 1919-20, £26,000; 1920-21, £55,934; 1921-22, £47,377; and in 1922-23 (to 31st May), approximately £30,000. These profits are substantial. ‘ I remind honorable members opposite that no suggestion to the contrary has ever been made by me, or, so! far as I know, by anybody else. The mill was established upon a basis which was contemplated for no other mill in Australia. It has the most efficient machinery, and is throughout a first-class proposition. I have never denied that, and I do not disguise the fact at this moment when we are discussing the price at which it has been sold. But there are factors which have to be taken into account in considering the future. There is the fact, to which the honorable member for Yarra has referred, that the mill has not been subject to taxation, municipal and similar charges which would have to be borne if it were operated upon a strictly commercial basis. The following table gives the figures, making allowance for taxation and other charges, showing what the net profits would have been over the years during which the mill has been in operation had those charges to be met : -
It will be seen from these figures that the profit of £220,000 shown over tha period dealt with., is reduced by the deduction of the charges to which I have referred to £163,000. Even allowing for these deductions the profits shown for the years 1920-21 and 1921-22, which the honorable member for Yarra took in making his estimates, were still very substantial. Making allowance for the charges which have been mentioned, the profits for 1920-21 were £43,000, and for 1921.22, £36,000, or for the two years an average of about £40,000. The profits for the present year are on a lower scale. They are for nine months of the year £22,000, which would be equivalent to something like £30,000 for the full year. There is one significant fact about this matter, and it is that the profits are a diminishing quantity. I have said that the profits in 1920-21 were £43,000, and in 1921-22, £36,000, and the honorable member for Yarra has spoken as if we could rely upon the mill showing profits of this character in the future. He has overlooked a great number of facts in coming to that conclusion. He should remember, in the first place, that, during that period the mill was working uninterruptedly with an absolutely certain output that was disposed of for the purpose of providing civilian suits for soldiers after they returned. These suits were made from very few patterns of a very plain cloth, and honorable members will understand that a certain output of a limited range of patterns of simple cloth made the cost of production as low as possible. Does the honorable member for Yarra remember the position in .Australia with regard to woollen goods generally during those two years when the profits on which he has based his estimate were earned ? Any one who has the slightest knowledge of this trade will agree that that was the greatest boom period ever seen. The period of the war was not comparable with it in any way. There was an absolute world shortage of these goods, and prices were very high. Anything of the kind that was produced was snapped up at once. A very different state of affairs has been brought about in the interval, and, to-day, the woollen trade has .swung right round. Enormous stocks manufactured during the boom period accumulated, the demand suddenly ceased, and in 1921 the effect was such that in Great Britain there were probably not half-a-dozen wholesale woollen houses that were not financially bankrupt. That was* the position after the boom period, which has been taken by the honorable member as a basis for the whole of the future operations of this mill. The honorable member, having appreciated the fact that profits had jumped to nearly double what they were at the end of the financial year 1919-20, ingeniously explained away the fact by saying that the system had been changed, the mill, therefore, making greater profits than before. As a matter of fact, that was the greatest boom period that has been known in the woollen trade; and it is certainly a. most dangerous criterion by which to judge of the future. I do not think that, on further consideration, the honorable member will maintain that the prospects are quite as bright as he has tried to picture them. I can assure him that the Government could not take such an optimistic view as he has done. The honorable member probably knows, or he ought to know, that to-day it is becoming more difficult to obtain orders for woollen goods. We have to remember that every day this industry is extending more and more in Australia, with further mills coming into existence; and, while I believe it has a great future, I say, without hesitation, that it has to be conducted on the most efficient lines. Those who embark in this industry regarding it as a simple road to fortune, may meet with serious disappointment, if not, in the end, disaster. These are the facts with which the Government were faced when, in view of the higher valuation, they came to consider whether they were justified in accepting the offer made. The Government realized what they were doing when, they sanctioned a price which was lower than that valuation. We naturally hesitated for a long time, but we remembered that we had exhausted the possibilities of securing a purchaser at a higher figure. We visualized the dangers of the future, and the obvious diminution of profits,, and we came to the conclusion that delay would probably mean, a loss in continuing the business, and that in the end a lower price still might have to be accepted. This was what led the Government to their decision - a decision which
I affirm without hesitation was a right and proper one.
The honorable member for Yarra (Mr. Scullin) has drawn pictures of what profits the purchasers are going to make out of this mill now that it has come into their possession. He has given the value of the mill at no less than £400,000. It is almost beyond my comprehension that anybody can believe that this property is worth that amount to a purchaser, when nobody has..been found to offer more than £.155,000. The honorable member bases his valuation on what it would cost to put up the mill at the present day; but the final test, whatever the nature of an asset is - a manufactory, or any other property - is not what it could be erected for, but what can be realized from it - what can be got out of the asset which is being bought. We have to remember what the results from this mill have been in the past, and the charges that any purchaser will have to meet in the way of rates, taxation, and so forth. We have to remember always that this mill, under the Government, was run under the most advantageous conditions possible; there was absolute continuity of employment, with three shifts clay and night during the war, turning out the same class of cloth for our soldiers who were at the Front. After the war was over the mill continued to turn out a very limited range of patterns for suits which were first given to the soldiers, and1 were subsequently purchased by them. There is no possibility of the mill being run on such terms in the future. Something more must be done than to merely turn out a certain limited range of patterns if the enterprise is to hold its own. The mill cannot be carried on by either the Government or private enterprise unless a worsted plant is secured and worsted cloth as well as plain cloth turned out; the transactions of the future will certainly not be so simple as those of the past. The mill will have to compete in a market where there will not be found the ready and eager purchasers hitherto found ; it will have to compete for orders, and may find difficulty in. obtaining them. In view of the whole position, and the prospects of profits, it is certainly completely out of the question to contemplate such a figure as £400,000. The honorable member for Yarra has calculated what it would cost to erect the building to-day, and told us that it would mean an expenditure of £112,000. The honorable member made eulogistic references to the character and type of the building, and it certainly is a first-class example; but would anybody, save the Government, for the purpose of carrying on this industry, provide such a building? No; none but the Government could afford to do so. A man who intended to run a woollen mill could not be expected to put up a building so extravagant, when he could provide another to serve his purpose equally well at a quarter or a third of the cost. All these facts have to be taken into consideration. It is quite true that there is a first-class plant in the mill, and it has been said that such a plant would cost much more to-day than before the war. It certainly would cost very much more ; but it would not cost anything like the figure that has been suggested as the one a purchaser would have to pay if he were himself erecting a mill.
The suggestion is that the transaction is clouded with an atmosphere of suspicion, when, as a matter of fact, the Government simply took what they considered was the wisest course. I assure the honorable member that the Government had a proper appreciation of the position, and have not been guilty of any of the things suggested by him. There are many sides to a question of this character. Up to date the mill has certainly been successful, and nobody can suggest that it has not been managed efficiently, but, as I have, already said, it has been conducted in circumstances that insured success. Everything has been in its favour - certainty of market for the output, continuity of employment and concentration on a limited range of articles of manufacture. In open competition with rivals and faced with the possibility of not being able to dispose of its output, with no guarantee of continuity of orders and with increased overhead charges, as would have been the experience had the Government retained the mill, the financial outlook would have been entirely changed. Broadly speaking, the history of Government enterprises does not encourage the hope of an unchecked career of prosperity, as has been hinted by the honorable member, concerning the future of this mill. I could give many instances of misfortunes having overtaken Government ventures, especially in the State to which the honorable member himself referred. The Queensland Government in recent years have become involved in many similar ventures. .1 remind the honorable member of some of them. As we all know, the Queensland Government own a considerable number of cattle stations. They went into the busi- ]less in June, 1916, and the record1 of their transactions to 30th June, 1922, discloses a total profit of £167,000, and a total loss of £367,000, representing a net loss of about £400,000. At the 30th June, 1922, there was invested in those stations a total of £1,663,000 of public money. Mr. Theodore, who, I think, believes in this policy, has admitted that they have not been so successful as he had anticipated, and I suggest that when the time comes for the Queensland Government to see how much of this £1,660,000 of capital can be recovered, he will have occasion to seriously reconsider his position. Another venture of the Queensland Government is the produce agency-
Mr Charlton:
– Mr. Speaker, I rise to order, and ask for your ruling as to whether the honorable the Prime Minister, having spoken on two- previous occasions in this debate, is in order now in referring to the business activities of the Queensland Government? My point is that he must confine himself to the amendment.
Mr SPEAKER (Rt Hon W A Watt:
BALACLAVA, VICTORIA
– On the point raised by the honorable the Leader of the Opposition, I remind the House that the Chair always allows responsible Loaders of parties in the House more latitude than other honorable members. Strictly speaking, members who have spoken before in this debate mus confine themselves to the amendment now before the Chair, and I ask the Leader of the House to follow that practice.
Mr BRUCE:
– I regret very much if, unwittingly, I have offended. In reply to certain criticism of the Government for having sold the woollen mill, I was endeavouring to show that we took the right course by selling at the price offered rather than by continuing to run the mill, and to make my point clear, I had occasion to refer to the experiences of similar activities carried on elsewhere in the
Commonwealth. I do not want to offend against your ruling, Mr. Speaker, but I respectfully submit that I am entitled to quote the result of Government trading ventures in Queensland in order to refute the suggestion, made by the honorable member for Yarra, that the Government should not have disposed of the Geelong mill. I trust I shall be allowed to continue briefly. The Queensland State Produce Agency has been running since April, 1918. The capital invested is £13,000, and the loss to date is £28,000.
Sitting suspended from 6.S0 to 8 p.m.
Mr BRUCE:
– I ask leave to continue my remarks at a later hour.
Leave granted; debate adjourned.
page 217
NEW MEMBER
Mr. Nelson made and subscribed the oath of allegiance as member for the Northern Territory.
page 217
GOVERNOR-GENERAL’S SPEECH: ADDRESS-IN-REPLY
Censure Amendment
Debate resumed.
Mr BRUCE:
Prime Minister and Minister for External Affairs · Flinders · NAT
– I have referred to station properties and produce agencies in Queensland where State enterprises are carried on to a greater extent than elsewhere. I do not wish to weary honorable members with complete details of all these undertakings, but in addition to the two mentioned, I have the figures in relation to the cannery, fish supply, butchers’ shops, the hotel at Babinda, and the railway refreshment rooms.
Mr Blakeley:
– I am extremely reluctant to interrupt the excellent discourse of the Prime Minister (Mr. Bruce), but I submit that he is not in order in discussing questions other than those raised by the amendment before the House.
Mr SPEAKER (Et Hon W A Watt:
– The amendment covers the sale of Government enterprises, and the Prime Minister is in order if he shows that, in view of certain experiences in other parts of the Commonwealth, Government enterprises should be disposed of.
Mr BRUCE:
– I can quite understand hear the figures. The details are as the honorable member’s reluctance to under: -
It will be seen that the losses amounted to £501,256, and the profits to £161,738, showing an excess of loss over profits of £339,518. As I have already pointed out, the Premier of Queensland, Mr. Theodore, realizes the dangers of these enterprises, because at Rockhampton he admitted that the State cattle stations, in which £1,600,000 had been sunk, were a bad investment. I do not think I could give more conclusive proof of the failure of State enterprises.
The details of the State enterprises in New South Wales are as follow: -
The figures show that £856,132 has been invested, and as a result of the operations the losses have amounted to £408,106, and the profits to £263,970, showing a net loss of £144,136. It must be remembered in considering the figures that these enterprises have not had to pay income, tax, nor have they been called upon for the ordinary rates and taxes which have to be paid by private enterprises, so that we have to add a further amount to the total of the losses to appreciate the actual posi tion. A more serious thing is the amount of capital at risk, which, in Queensland, is well over £2,000,000, and in New South Wales over £850,000. It is within the knowledge of honorable members that the present New South Wales Government have been endeavouring to dispose of a number of these State activities, and that it has been almost impossible to sell them. Where they have been sold there has been a very heavy capital loss. Honorable members from
Western Australia know the position in regard to the State industries there, where the same serious results have followed the intrusion of Governments into the sphere of ordinary trade.
The only other matter I wish to speak of is the manner in which this case has been presented. The attack on the Government consisted almost entirely of insinuations concerning the good faith of certain people, such as reference to action taken in the dark, and efforts being made to cover up what was being attempted. There is not a scintilla of truth in these insinuations. Everything the Government have done has been done openly, and those who wished to criticise had every opportunity of doing so. Sinister suggestions were made about the price received for the mills. The Government offered the mills for sale. We advertised for tenders in Australia, New Zealand, and Great Britain, and information about them was also sent to the United States of America. We received certain tenders, but being dissatisfied with the prices offered, we again called for tenders throughout the world. On the second occasion we received an offer of £150,000, which,- by negotiation with the proposed purchaser, was raised to £155,000, at which price we sold the mills. We take every responsibility for the sale.
The suggestion has been made that, in view of the valuation we had received, we should not have disposed of the mills at the price we accepted, but should have held them. In an endeavour to point out the dangers which would have attended such a course, I have indicated that the figures which the honorable member for Yarra has given were based upon two years’ operations during the period of the greatest prosperity for the woollen industry that Australia has enjoyed. We realized that we had no hope of anything of a similar character in the future, and we felt that if we refused this offer in the hope of getting an enhanced price later on, we should run a serious risk of turning the triumphal career of the mills into a disastrous smash, and that we should then be offered a very much lower price than that we have accepted .
Another suggestion is that we should have called for fresh tenders. I ask hon orable members to use their common sense in judging the probable result of a third attempt. To appeal twice was an exceptional course. In all probability a third appeal would have brought still lower offers.
In regard to the valuation of the mills, the honorable member for Yarra quoted what they originally cost, and showed that the cost of building is considerably higher to-day. He seemed to suggest that’ in establishing a woollen mill to-day a building of the character of that at Geelong would be erected. The honorable member knows very well that that is not so.
The honorable member has drawn a most improper inference from what took place during the negotiations for the sale of these mills. According to him, the Government had some sinister design in appointing Mr. Kettlewell as their representative to arrive at the value of the stock in hand and goods in the process of manufacture. The truth is that the Government, being anxious to get the best possible opinion, and to insure that the value placed upon the stock in hand and goods in process of manufacture was a fair one from the point of view of the Commonwealth, sought the advice of ‘Sir John Higgins, chairman of the British-Australian Wool Realization Association, who, as every one will admit, has a greater knowledge of the woollen trade than has any one else in Australia. It was on his advice that we employed the services of Mr. Kettlewell, a fact which the honorable member for Yarra probably knew, but did not choose to mention. The honorable member made the direct charge that there was some secret connexion between Mr. Kettlewell, Senator Guthrie, and the people who were purchasing the mills.
Mr Scullin:
-. - I said that there was a connexion, but I did not say that it was a secret one.
Mr BRUCE:
– By those who heard the honorable member’s remarks, no other inference could be drawn than that there was a most suspicious connexion between Mr. Kettlewell and Senator Guthrie. He attempted to cloud the transaction with fumes of suspicion and talk’ of improper practices. No one believes for a moment that Senator Guthrie has indulged in improper practices. An attempt has been made to cast further suspicion on these negotiations by bringing in the name of Mr. Philip Russell, because his son happens to be my private secretary. Mr. Russell is one of those gentlemen who, as a wool producer, believes that every effort should be made to get Australia to manufacture its own wool, and to this end he is anxious that the operations of the mills at Geelong should be continued.
The honorable member’s object was to cloud the whole transaction with suspicion. His speech was a political move, like the previous amendments submitted by the Opposition during this debate. It was not an attempt to serve the people of Australia, although honorable members pretend that they are doing that. Everything done by them is done for political purposes only, and there is no sincerity in their utterances. The peroration of the honorable member for Yarra might have thrilled any one who did not happen to know him. Those who know him could appreciate it at its proper value. His condemnation of persons who are “ doing most hideous things against the interests of the Democracy of Australia,” would have sounded well on a platform in his own electorate, and would have been greeted there with thunderous applause, but here, the honorable member was talking to a different audience, and his words will be criticised and tested. Of course, the knowledge that that was so did not affect the honorable member very much. His purpose was to have hundreds of copies of his speech : printed and distributed among his friends, who will admire the way in which their representative tackled the “ capitalists, profiteers, and bloodsuckers.” The honorable member has played his part in this debate admirably, from the point of view of his own side. First of all, his Leader came, fired the heavy artillery, but most of his shells were duds. Then we had the pleasure of listening ‘to our breezy and brilliant friend the honorable member for Bourke (Mr. Anstey), who supplied the light artillery - something iti the nature of the famous “ seventyfives” of the French. The worst role fell to the honorable member for Yarra (Mr. Scullin), who was called upon to discharge the poison gas, and he did so, I regret to say, in an easy and natural manner. We remember how the civilized world stood aghast when the Germans adopted that method of warfare. At first the Allies would not have anything to do with it, but they had to protect and save themselves, and eventually were compelled to employ the same weapon. The position of honorable members on this side is not as perilous as that of those in the line during the war. We shall, therefore, leave to honorable members opposite thi6 new method of political warfare. The use of poison gas does not commend itself to us. We will not follow them into the depths into which they have descended. I do not wish for a moment to ‘minimize the importance of our action in the disposal of the woollen mills; but I regret that the issue has been clouded by ‘the atmosphere created by the honorable member for Yarra. The real question at issue fundamentally divides honorable members on this side from those opposite, who wish to nationalize industries at every opportunity. We on this side of the House do not believe that salvation lies along that path. A debate on this issue would have been useful and instructive to the country. But honorable members opposite are not too proud of their objective. On the platform they studiously refrain from referring to.it. Before the Labour party was joined by its Communist friends, its members were reluctant to speak of the Labour objective, and if they were embarrassed prior to their association with their ,new allies, they will be more awkwardly situated in. future. Instead of contenting himself by stating the facts, the honorable member for Yarra interspersed his remarks with innuendoes, and cast grave suspicions upon individuals. It is useless to reply to argument of that nature. I leave it to the country to judge the merits of the case. Without hesitation I say that the great majority of people will be moro prepared to believe that I have not been guilty of the things I am accused’ of than to say that the honorable member for Yarra has not made a statement merely for political purposes. I am confident that the honorable member has not deceived the House as he attempted to do, and has not successfully clouded the issue. The point is whether the Government should carry on trading operations on a commercial basis, not merely to supply its own needs, but with a view t« making profits. The whole transaction has been carried out in a perfectly open manner. The Government has acted with the utmost good faith, and in the way which it believed to be in the best interests of the country.
Mr CUNNINGHAM:
Gwydir
– As thi3 is the first occasion on which I have addressed the Chamber since the Parliament was elected, I desire to congratulate you, Mr. Speaker, upon your elevation to the Chair. But in view of the circumstances surrounding your appointment, I offer you a warning by reminding you of the fate of your predecessor.
A good deal was said in the last Parliament to the effect that the ex-Prime Minister (Mr. Hughes) was leading a “one-man” Government, and, judging by the attitude «f the present Ministers, I cannot escape the conclusion that the present Administration is also a “ one-man “ Cabinet. Why does not the Minister for Defence (Mr. Bowden) defend his own administration? Is it because the dominating personality of the Prime Minister stands out i n bold relief against the incapacity of his oolleagues, and leads to his being the spokesman for both parties on the other side .of the House.? The honorable member for Yarra (Mr. Scullin) made most serious charges against the Government, and they have not been answered. The Prime Minister (Mr. Bruce) referred to tlie losses sustained in the cattle transactions of the Queensland Government, but did not point out that in all the States hundreds of men connected with the meat industry have become bankrupt. Instances of failure in State enterprises afford no justification for the Commonwealth Government disposing of a valuable public utility such as the woollen mills at less than their value. The present issue is not between public and private enterprise. The whole question is whether the Government received a fair value for the mills, and whether everything connected with the transaction was done openly and above-board. The mills were sold secretly, because the terms the Government was prepared ultimately to accept were never made known to the investors of Australia. Had that course been followed, other offers would undoubtedly have been received. A dangerous and sinister precedent has been set up, without taking into consideration the question whether the mills were a profitable investment or not. Do honorable members opposite contend that the public have received a fair deal, in view of the independent valuations made? It has been stated that a member of the other branch of this Legislature openly declared that he was going to join a syndicate to purchase the mills. That does not lessen the seriousness of his conduct in any way. If I commit a burglary in the city of Melbourne, it does not make the offence any less reprehensible if I declare my intention beforehand. I regret that the Prime Minister spoke sneeringly of the honorable member for Yarra (Mr. Scullin) for placing the facts before the public. It would be just as logical to accuse the Crown Prosecutor of being a criminal because he places the facts of a case before a Judge and jury. The honorable member for Yarra would have been recreant to Ms trust as a public man if, knowing what he does, he had failed to place the strongest possible case before the people. After all, the Geelong Woollen Mill did not belong to the Government; it belonged to the people, who found the money for it, and have lost by reason of the disposal of it.
I come now to the question of policy. I would refer honorable members of the Country party to the statement made by them throughout the length and breadth of the country during the last elections, that they were in favour of bringing producer and consumer closer together. How could producer and consumer be brought closer together than toy the agency of a Government-owned woollen mill? As a representative of one of the largest wool-producing electorates in Australia, I say that it would be to the greatest possible advantage of every primary producer if we could manufacture in Australia every ounce of wool we produce, instead of sending it out. of the country in its raw state. Private enterprise is not always in favour of cutting its capital into new ventures and pioneering fresh fields of enterprise. When it does so, the consumer is unduly penalized by having to pay high for what is manufactured. The members of the Labour party, and the workers of Australia, have no spare capital to invest in enterprises such as the manufacture of woollens, but the Commonwealth, in which we all are shareholders, can find, and did find, in a time of peace, money for this purpose. Why should I, a taxpayer from the backblocks of this country, not have the advantage of being able to obtain cloth from a Commonwealthowned woollen mill? Dare members of the Country party go into their electorates and say to the wheat-growers, “We do not believe in competition with private enterprise, and therefore we are in favour lOt sacrificing the Commonwealth Government Line of Steamers?” They dare not do it, because the wheatgrowers want the advantage of low freights. But they nevertheless say to the industrialists - who are also taxpayers, and who under the new proposals of the Prime Minister will pay more taxation than they pay now, because he is relieving his wealthy friends from carrying the burden of the war - “You shall not have cheap cloth to clothe yourselves, your wives, and your children. We . intend to hand the woollen mill over to our investing friends.” The Prime Minister may disguise and deny the fact that there has been underhand work, but if underhand work had to be done, how could one attempt to do it, except in the way in which this deal was negotiated? The Prime Minister, as a public man, should have been cautious in the dealings which took place between himself and Philip Russell and his son. Australians are proud of the purity of their public life. There is strong circumstantial evidence in regard to these transactions.
Mr Gibson:
– To what underhand work does the honorable gentleman refer ?
Mr CUNNINGHAM:
-When I. sit down the Minister can, if he likes, stand up and state his case. The underhand work to which I refer is the selling of the mill secretly, without advertising the ultimate terms. ‘The Prime Minister said, “Make the (best terms possible.” He did not say, “ Advertise again the ultimate terms we are prepared to accept.” If the ultimate terms on which one is prepared to deal are not advertised’, it is a secret sale. We have only to consider the difference in the conditions of sale. Instead of one-third deposit, onetenth was accepted, and instead of 6 per cent, interest, 5£ per cent, was charged; and so on, right through the business.
Mr Gibson:
– And instead of £150,000, £155,000 was got for the mill.
Mr CUNNINGHAM:
– But the official valuation was over £267,000. If the Prime Minister’s financial friends were toorder the sale of the Commonwealth Line of Steamers, or the destruction of the Commonwealth Bank, they would find in him a willing tool. He sneered at the honorable member for Yarra, and said, “ He is in a different atmosphere here.” May I remind this super-shopwalker that he also is in a different atmosphere here. “Woollen mills to the right! Commonwealth steamers to the left! Dockyards round the corner! Forward Mr. Bowden!” Those cheap personalities regard- ing the honorable member for Yarra are unworthy of the gentleman who occupies the very high and honorable position pf Prime Minister. He said that he had nothing to do with the sale of the mill beyond casting his vote as a member of the Government. The file of papers shows that the Prime Minister minuted them, “ Make the best possible terms with Dyer to sell.” Therefore, we say that he did. take part in the transaction and played a big and prominent part in the secret sale. He says that we, on this side of the House, have changed our policy since the establishment of the mill. We have done no such thing; though it is a phase of the matter which, in any case, does not enter into the argument. We charge the Government with having sold the mill for less than its proper value. The fact that it was not sold when it had been advertised twice has no bearing on the question. Properties are sometimes advertised over and over .again until the vendor secures what he considers to be a fair price. The Prime Minister says the mill could not be advertised a third time, because that would have indicated to the people -that the Government was in difficulties. That might be so in the case of a private individual; but the Commonwealth Government is in different circumstances. The Government is not in difficulties, and its position is not analogous to that of a private individual. The Commonwealth was not in need of money, aud therefore that argument does not apply. The Commonwealth mill was a paying proposition. ,The indecent haste with ‘ which the Government altered the terms of the tender, without any notification to the returned soldiers who wished to bid for the mill, proved that the Ministry did not intend to give these men a fair deal. The Prime Minister thought that if the returned soldiers purchased the mill they would be embarking upon a hazardous undertaking, but he is not the best judge; tha seller is not the one to judge whether the buyer can make a success of a venture or not. If the returned “soldiers had known that a deposit of £15,000 would have secured them the mill, a company would have been immediately floated, and no doubt loyal and patriotic men, such as those comprising the syndicate which ultimately purchased the mill, would have come to the rescue and_ helped them to obtain the mill. The Prime Minister endeavoured to show that the Commonwealth mill was of no further use for the purpose of supplying cloth to returned soldiers, as the Returned Soldiers’ League had not altogether fulfilled its contract for supplies from the mill. The honorable member for Yarra (Mr. Scullin) did not base his case on that aspect. The Prime Minister simply side-stepped the issue by introducing superfluous matter. There is a reason for the decreased demand for supplies. Cloth was supplied only to soldiers who were members of the Returned Sailors arid Soldiers’ Imperial League of Australia. That body was utilized for political -purposes, and supporters of the Labour party would not retain membership of it. It was frequently used to bolster up the platform of the late Prime Minister, and in consequence of these tactics many men became disgusted and resigned from the League. Thus the League was unable to carry out its contract with tha mill. The Prime Minister dealt with the Commonwealth Woollen Mill as a business proposition, and stated that distributing agencies could not be established, but there was no reason why such agencies could not be formed. The parcelspost department handles hundreds of thousands of packages for retail firms in the capital cities of the Commonwealth. This mill was established at the taxpayers’ expense, and why should they not have been given the opportunity to secure its products? The men in the back- blocks would have been delighted to have had the opportunity to procure suit lengths from the Commonwealth Woollen Mill at reduced prices. If necessary the mill authorities could have charged the ordinary trade rates, and the public would have still been prepared to buy, knowing that they .were securing a good article. The Commonwealth Mill was not established to make enormous profits or to exploit the consumers. ‘The price of cloth could have been increased to cover the cost of distribution and still make the article a wonderful investment for the people. The Prime Minister enlarged on the danger of bad debts, and gave the experience of Flinders-lane. Those interests, he would have us believe, make their profits out of bad debts. There are other trading concerns working on a cash basis, such as the Post Office and the Commonwealth -Line of Steamers, and if more of the businesses of Australia adopted this method of trading it would be of great benefit to honest men and women, for the reason that those of us who pay cash pay for those who do not pay at all. The practice of Flinders-lane is to write off bad debts and readjust prices in order to cover the loss. It is not the wage-earner who secures credit, but the alleged gentleman of good appearance who rides in his cax and by a confidence trick creates confidence and ultimately vanishes. I commend Flinders-lane for having secured the services of such an excellent spokesman as the Leader of the Government, who would lead us to believe that the commercial magnates were making, not extortionate profits, but, rather, a loss on their transactions. I advise the Prime Minister, and those of his colleagues who think with him, to read the Inter-State Commission’s report on the wholesale trade, which was issued when this country was passing through one of the most critical periods in its history. It shows that Flinderslane is both soulless and bowelless, and that the great wholesale concerns extracted extortionate profits from the general public and manufacturers of Australia. Serge material, which was made i.at the Geelong’ mill for lis. per yard, was sold at Flinders-lane the following day at 39s. per yard; yet the
Prime Minister contends these wholesale firms are not making extortionate profits. Honorable members opposite should read the unbiased report of the Clothing Commission which was appointed by u Tory Government of Victoria. It is, if anything, more damning than that of the Inter-State Commission. The Prime Minister has submitted to the House a faked table of figures.
Mr SPEAKER (Rt Hon W A Watt:
– The honorable member is not in order in making that remark.
Mr CUNNINGHAM:
– I will take a direction from you, Mr. Speaker.
Mr SPEAKER:
– I will not give a direction.
Mr CUNNINGHAM:
– If the remark is not in order I withdraw it. The table of figures referred to does not set out the true position according to the balancesheet submitted by the Commonwealth Government.
It is said that figures cannot lie. You can so arrange figures, however, that they make a position appear entirely different from what it really is. The Prime Minister has quoted as gross profit figures which are shown in the balance-sheet as net profit. The gross profit for the year 1916-17 was £42,638. From that amount was deducted depreciation to the extent of £10.810. As the honorable member for Yarra (Mr. Scullin) pointed out this afternoon, 5 per cent, was too high a depreciation to write off buildings; 2J per cent, would have been ample. Interest at 4 per cent, on the capital invested, or loaned by the Commonwealth Treasury to the mills, totalled £9,414. It is only after that depreciation and interest had been deducted that we get the net profit of £22,414. Gross profit is the amount actually received on account of sales made, with no charges for depreciation or interest. How often does a private concern, when it has had a lean year, reduce the amount of depreciation rather than disclose a lesser profit, keeping the dividend at the amount distributed in ordinary years? That is a wise thing to do in order that the shares shall not appear in the trading list as having carried a lesser dividend one year than another. The Prime Minister has deducted from that net profit of £22,414, taxation, municipal, and other charges amounting to £5,746. I submit that it is entirely irre gular to charge with Federal and State income tax money invested by the taxpayers, and say that you can compare it with private enterprise. We, as the people, own this concern, and it would be ridiculous to tax our own investment. The Prime Minister asks us to consider these State enterprises from the point of view of the balance-sheet. You might with equal justification consider your own home from the point of view of the balance-sheet - put the expenditure in connexion with your home on one side and the profit accruing from it on the other side; and, because it does not show a profit, sell your home. It is ridiculous to say that a State enterprise should be made to show a profit in its balancesheets.. You do not expect that from your developmental enterprises, such as this mill was. Even from the point of view of profits, this concern would still show an enormous return. For what reason are State enterprises brought into existence ? In the first place, many of them are instituted to protect the people from undue exploitation from private enterprise. Therefore, their first duty is to keep down the cost of the commodity to the public. That is a fair and reasonable thing. The question of balance-sheets is a secondary consideration.
The Prime Minister has said that the Queensland Government has lost thousands of pounds on its cattle stations. Private enterprise also throughout the length and breadth of Queensland has lost heavily - so heavily that these gentlemen, who do not believe in socialistic enterprises, have had to* come ca.p in hand to this private enterprise and business Government to receive a dole. We do not object to that. We on this side believe in assisting industries that are in difficulties. The Labour party says “ Help the meat-grower; tide him over this period of depression.” We say, also, “ Help the wage-earner and the small man in the back country; let him have cheap cloth and so help him .to keep from his door the’ spectre of starvation.” He is more entitled to it than are the wealthy in the. community. With the wealthy people the matter of a few thousand pounds one “way or another does not mean the difference of one pair of blankets, one meal, or a pair of boots; but the difference between 6s. a yard and 30s. or 35s. a yard for tweed - as charged by Flinderslane - does compel the worker to do without a pair of blankets, or a pair of boots for his children, or for . his wife some of those little luxuries with which the wealthy people are surfeited. The following table discloses the real position with regard to these profits, during the period from 1916 to 1922 : -
There were only two years - 1919-20 and 1920-21 - during which this mill competed to any extent with private enterprise. I wish particularly to draw the attention of the people to these figures, because by his action in regard to the balance-sheets . the remainder of the Prime Minister’s statements can be measured.
Mr Fenton:
– Absolute juggling with figures.
Mr CUNNINGHAM:
-It was an absolute juggling with figures, which did not disclose the real position of this enterprise that the foresight of the Labour party was responsible for having created before the war. Had these mills not been established, many hundreds of thousands of pounds would have been added to the enormous burden of war taxation which the people of Australia are carrying today by reason of the profits that would have been extracted from the Government by the private enterprise contractors, who made a habit of fleecing ‘ the people during a period of war. The troops of Australia were admittedly the bestclothed troops that participated in the war, and that was due wholly and solely to the fact that this enterprise was brought into existence by the Labour Government, which had the courage to put into effect its policy during the time that it occupied the Treasury benches.
I ask the Minister for Defence (Mr. Bowden) to tell us why the Government turned down the recommendation of the Munitions Board - that Mr. Denison should be appointed a valuator - and appointed Mr. Kettlewell.
Mr Bowden:
– Sir John Higgins thought that Mr. Kettlewell was the best man for the position.
Mr CUNNINGHAM:
– Does the Government of the country rest in the hands of Sir John Higgins?
Mr Bowden:
– No; but he is a good adviser.
Mr CUNNINGHAM:
– What was wrong with the other man? Did the Minister have inquiries made to ascertain what was Kettlewell’s connexion with the Lincoln mills, and what was Senator Guthrie’s connexion with them? Occupying the position he does, the Minister should have made the fullest possible inquiries. He should have said to Mr. Kettlewell, “ Are you in any way. associated with any of the parties who are buying this concern?” As a valuator for the Commonwealth, Mr. Kettlewell might continually have come into conflict with the interests of Senator Guthrie in the valuations that he was making. It may be said that Senator Guthrie’s interests were only small; I think the Prime Minister mentioned that he held 2,000 £1 shares. It would not matter if he had only1s. invested in this syndicate. Senator Guthrie had inside information from Mr. Massy Greene that £130,000 was the amount of the highest tender. In view of that, it was most improper for the Commonwealth Government to appoint as valuator for the sellers a co-director of one of the buyers. Those are the facts which were stated by the honorable member for Yarra (Mr. Scullin) which brought upon him the vials of the Prime Minister’s wrath. The honorable member for Yarra made no comment on those facts. I do. I say that it was the duty of the Government to make the most extensive inquiry to ascertain who were members of the board of directors of this concern, in which Mr. Kettlewell was interested. If that is not done, then, in the event of an unscrupulous Government coming into power, we shall have “ graft “ of the very worst description, and this transaction will be cited as a precedent.
In attempting to justify the action of the Government in disposing of the Geelong Woollen Mill, the Prime Minister painted a very doleful picture of the future of the industry. He declared that investors in enterprises of this character were undertaking a very hazardous operation, and that many of these were doomed to failure. Yesterday, the honorable gentleman put before us an entirely different picture. Under his Government, he told us, Australia would have an era of prosperity, and he proceeded to open up a smiling prospect of fields of industry and great profits. There is every reason to believe that the woollen industry of Australia has a most promising future, since the Government will have” to raise the Tariff to such an extent that it will not pay to import woollens to compete with local manufacturers. Did the Prime Minister whisper in the ear of young Mr. Russell, “ Tell your dad that this is a rotten undertaking ?” Did he advise his confidential secretary to tell his father that he should “ pull out “ of this hazardous enterprise? I think not. The honorable gentleman said that the profits from the mill were a diminishing quantity, and that the profit made by it on the tweeds manufactured and sold for the clothing of our returned soldiers was due to the fact that they were confined to plain patterns. The truth is that the suits for our soldiers were made from tweeds of many patterns, and’ that it is estimated that the machinery necessary to enable the mill to turn out a most extensive range of patterns could be installed at a cost of from £40,000 to £50,000. The mill was able to sell its output at 6s. per yard, and yet make substantial profits. The outlook of the industry was never, better than it is to-day. Notwithstanding the dislocation of trade on the continent of Europe, and the possibility of war in the near future, which would make more difficult clearances from continental countries, prices for raw wool in Australia have never been higher than they are at the present time. Does that suggest a diminishing field of profits for the local industry ? Does it suggest that those engaged in the woollen industry believe that a falling away of profits is in store for them? The Government having consented to hand over to the States the power to levy income tax on individuals, the Commonwealth will have to rely on Customs duties for its revenue, and, in order to’ meet their obligations, the Government will be compelled in the near future to substantially increase the Customs Tariff. This will mean a higher measure of protection for Australian manufacturers, and the indications are that the woollen industry in Australia will flourish as it has never flourished before. For the Prime Minister to say that the undertaking is a hazardous one is to entirely misrepresent the position. Senator Guthrie, when speaking of this matter in another place, pointed to the enormous increase in the number of woollen mills in Australia. He declared that within the last few years the number had been trebled, and that the mills were employing a far greater number of hands than ever before. This is due to our highly protective Tariff, which is assisting our manufacturers, and opening up to them on a more favorable basis of competition the great market at our own door.
I come now to the value of the mill building. The Prime Minister says that the building is a magnificent one. It is acknowledged to be one of the best for the purpose in Australia ; but its construction is not on extravagant lines. I know of other woollen mills in . Geelong that, like it, are constructed of brick with concrete floors and iron roofs. There is not much difference between the mill buildings which the Government have just sold and others in the industry.
Mr Scullin:
– Except that the lay-out of the Commonwealth building is more modern.
Mr CUNNINGHAM:
– That is so; but it would be idle to attempt to carry on the industry in a building constructed of, say, galvanized iron, with an earthen floor. In order to carry the requisite machinery, the building must be of a substantial character, the floor must be impervious to water, and be capable of being swept and washed down. It is absurd to say that a building for use as a woollen mill could be erected” for much less than the valuation put upon this mill. While it is certainly a fine building, and, unlike many a structure erected by contract,’ was faithfully and honestly constructed, I emphasize the point that it was not extravagantly built, and that any man proposing to set up a woollen mill would have to adopt the same class of construction. No more effective reply to the Prime Minister’s Statement on this subject could be given than that afforded by the valuation of the building and machinery made by the Government’s own valuer. The book value of the building allows for £85,000 written off for depreciation. That amount was provided out of the profits of the mill, and must be taken into account when determining what the actual profits were. The Prime Minister misrepresented the position, because we know that great business enterprises, owning properties worth hundreds of thousands of pounds, set out in their balance-sheets book values which frequently represent but a ridiculously small portion of their true value.
In dealing with State trading, the Prime Minister failed to refer to the Queensland Government’s highly successful State insurance scheme. He carefully avoided that phase of its activities. So successful has the Queensland State insurance scheme been that the general manager of one of the big life insurance companies, speaking publicly in New SouthWales, said that a Commonwealth insurance scheme on the same lines would release for employment in more reproductive forms of industry many thousands of canvassers, and would save to the people millions of pounds in respect ‘ of premiums paid. The Prime Minister, however, said nothing of that phase of State enterprise. Surely, since he thought it fair to refer to the Queensland State cattle stations, he should have referred also to the success of the Queensland State insurance scheme. Only within the last few weeks the Queensland Government appealed to the people who are the grand jury of Queensland, with the’ result that they annihilated their opponents. This was the result of their appeal notwithstanding the fact that several members of this House went to Queensland in an endeavour to deal a death-blow at the socialistic Labour Government of that State. I have had personal experience of Queensland, and I say that that State offers great opportunities to any young men desiring to go upon the land, if they are prepared to put up with the hardships of pioneering. Queensland is blessed with a good climate and a sufficient rainfall, and there is less land alienated there than in any other of the Eastern State3 of Australia. New South Wales, with a larger area of
Crown lands alienated, is gaining population more rapidly than Victoria.
Mr Gregory:
– In the big cities, not in the country districts. New South Wales is losing population in the country districts.
Mr CUNNINGHAM:
– I will answer the honorable member for Swan (Mr. Gregory) by saying that those who are responsible for driving young men to the cities are the big squatters and land monopolists who support him, and who will not allow the young Australian to get on to the land. He may stay in the back country if he is content to be a boundary rider, for which position he requires only to be lazy and civil. That is not a high ambition for any young man, and it gives no adequate return for the hardships which one has to endure far from the centres of population. The blame for the fact that the country districts are losing their population lies at the door of the supporters of the honorable member for Swan. These are the men whom I had to fight in New South Wales, the big ‘squatters who were to be found behind every Country party candidate driving them from place to place, organizing for them and pouring money into their campaign funds; and for what reason ? Was it to put men on the land ? Not an all; it was to keep them off the land. The soldiers who fought for Australia in other lands will not put up with the conditions which the land monopolists of Australia ask them to put up with. Life in the cities is more attractive, and they will not remain in the back country unless they have land to settle on. They will not stay there as wage earners for some one else. I ask honorable members to say whether we can blame them. I have seen beautiful children reared on back-block stations, and I have in mind a wealthy man who closed a school and refused to provide a teacher for thechildren of his employees. His desire was that they should be allowed to grow up in. ignorance, to know of nothing beyond the limits of his station, in order that they might be content to work for him throughout their lives as did their parents before them. Those who have large families will not remain in the back country when by doing so they must deprive their children of the advantages of education. If they do, they feel they are recreant to the trust reposed in them. The country worker with a family growing up looks for work in the city in order to give his. children the advantage of education, so that in the competition with the children of the wealthy they may not subsequently start with the handicap of being ignorant as well as poor. I ask the honorable member for Swan to consider the transfer of population from country districts to the cities from this point of view.
I regret that the Prime Minister did not answer one charge made against him by the honorable member for Yarra (Mr. Scullin). He side-stepped the honorable member’s charges like a champion toreador. The toreador is the man to be seen in ‘the bull ring in Spain who, with a red flag, side-steps the horns of the angry bull. I venture to say that the Prime Minister’s exhibition of side-stepping today qualifies him for the position of a toreador, in which I believe he would be a great success. I suggest that the honorable gentleman might stop in Spain, on his road to Great Britain to attend the Imperial Conference and set the world right. In the last Parliament we had leading the Government the “ gentleman who won the war.” We were told that he was indispensable, that he could not be done without; that he was the little champion who won the war. But a nev/ Richmond is now in the field. In the present Prime Minister we have the “ gentleman who is going to save the world.” He is going to Great Britain for the purpose, at the taxpayers’ expense, of course. I suggest that the taxpayers might also be taken to the Conference to state their views on Imperial Defence. The Prime Minister told us that there is no necessity for the Commonwealth Woollen Mill, to-day because of the decisions of the Washington Conference on the matter of disarmament. Pie said yesterday that we are menaced in the East and must arm. He said, “ I must go to the Imperial Conference, and when I return must impose an enormous burden upon the people of Australia in the interests of Imperial Defence.” He has changed his position since last night, as a result of the amendment submitted by the honorable member for Yarra. Disarmament is now his theme. He trims his sails to every passing breeze. The Government find themselves in an awkward position because of their incompetence - to use the most charitable term
I can employ to describe their action ia connexion “with the Commonwealth Woollen Mill. They have sacrificed that mill. I toured a great portion of the electorate I represent since the mill was sold, and I have heard strong supporters of the Government express amazement at the price received for it. In view of the profits made by the mill, and its value as set out in the balancesheets year by year, they are amazed that it should have been sold for £155,000. One can make a very good estimate of the value of such a property when he knows the amount of capital invested in it, the time the plant has been in use, and the care taken of it. The management of the mill has always been considered highly satisfactory. We know that the machinery has been well looked after. Independent men have said that it is in good order and condition. Why, then, did the Government sacrifice the mill for the price that has been received for it? Why did the Prime Minister say that there should be consultations with the highest tenderer, and why did he minute the papers to the effect that the best possible terms should be made with that tenderer? In the case of Government contracts, of whatever kind, if there is an alteration involving even only fi or £5, the new conditions should bc advertised to the world. I take no notice of what the Prime Minister says about advertising in Groat Britain and America, because it has no bearing on the question. Capitalists in Great Britain and America have propositions placed before them every duy, so that they have not much inducement to go beyond their own countries for investments. Then, an American coming here would not perhaps understand our laws, or appreciate our labour conditions. Such men will lend to Governments, because then the transaction is on a broad basis, and they know what, they are doing; but the fact that no tenders were received from abroad for a private investment does not signify that the mill was’ unsaleable, or disclose any reason why such a ridiculously low price should have been accepted for it. These are the facts that have been placed before the House and the people by the honorable member for Yarra. I regret that the name of the ex-member for Richmond,
Mr. Massy Greene, has cropped up, when he cannot be here to explain the circumstances of his conversation with Senator Guthrie. The position was certainly a serious one for a gentleman occupying the high and honorable position of Minister. No matter what position Senator Guthrie may occupy, or in what esteem he may be held in this or another place, no Minister should have disclosed to him or any one else what the highest tender was. The occurrence may have been an oversight on the part of Mr. Massy Greene; but, even so, there was all the more reason why Senator Guthrie should not have associated himself with any interested syndicate. No member of Parliament is supposed to use, in his own interests, information received in the course of his parliamentary duties. At any rate, that is the view of honorable members on this side, though, of course, the standard of honorable members opposite may be different. If the standard of honorable members opposite is different in this regard, they ought to say so, and allow the people at large to judge between the parties. I do not think, however, that any member opposite would say that a member of Parliament should make use of information so obtained, or become associated with any syndicate or body . in such a way as to expose himself to the implication involved; otherwise the purity of our public life may be seriously affected, and the high respect in which. Parliament has been held in the past may rapidly disappear. If such conduct is permitted, gentlemen who for the first time enter Parliament, filled with high ideas, will -find that there are interested people only too ready to misconstrue any action on their part, and therefore it is all the more necessary for members to see that they are in no way connected with any transaction or persons likely to prejudice them in public life.We ought to live up to those high traditions which we are led to believe influence the mother of Parliaments.
Senator Lynch and other senators strongly protested against the disposal of these mills, and Senator Guthrie, when he spoke on the subject in the Senate during the last Parliament, made a speech of such a character that the Leader of the Senate said he would like to know whether it was in favour of the sale of the mill or otherwise. This allows that even strong supporters of the Government could not decide in their own minds whether it was right to dispose of it or not. The Prime Minister says that the forty-six members who voted for the sale of the mill have been again returned to Parliament, but it would be a strange thing indeed if that honorable gentleman were not returned by the constituency for which he now sits. Probably, in the welter of politics during the elections, the wisdom or otherwise of selling the mill never entered into consideration, and, therefore, it is wrong for the Prime Minister to say that the policy of the Government in this regard has been indorsed. As a fact, the selling of the mills for £155,000 has never been indorsed by the people ; indeed, the Government has never been indorsed by the people, and holds no mandate to govern. The Government came into existence as the result of intrigue and wire-pulling - as the result of work that is certainly no credit to the gentlemen who now occupy the Ministerial seats.
Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP
– Underground engineering !
Mr CUNNINGHAM:
-Absolutely. Those honorable gentlemen opposite oughtto be working on the underground railway in Sydney, for they would, I am sure, complete that work in no time.
Mr Bowden:
– Be generous, if you are not just!
Mr CUNNINGHAM:
– The honorable member was one of the party managers, and is now a Minister. I can only hope that if ever negotiations are opened up with my party I shall be among the party managers, for, if I am as successful as some gentlemen I see before me now, my elevation to the Cabinet will be assured. This Government, of all Governments wehave everhad., should be careful what they do, because they and their policy have not been indorsed by the people. The Prime Minister himself was not indorsed as the Leader of the Government. No sooner were the elections over than the Leader of the Country party (Dr. Earle Page), smarting under the whips of the scorpion tongue of the ex-Prime Minister (Mr. Hughes), demanded, like Salome, the latter’s head, and the present Prime Minister and his colleagues rushed off eager to bring the head of their late Leader grinning on a salver. Such are the gentlemen who now say that they had a mandate to sell the woollen mill for £155,000.
Let us glance for a moment at what has occurred even within the ranks of the Ministerial party itself. The honorable member for Lang (Sir Elliot Johnson) was not apprized of the fact that he was to be beheaded. until two days before the event, though every one else knew. I regret to say that the honorable gentleman who now occupies the chair was elevated to the position of Speaker not because the Government and their supporters thought that he had any superior attainments to fit him for the position, but simply because they wanted to get him off the floor of the House, because they were afraid of criticism that might injure them.
Mr Gregory:
– Do you suggest that the present Speaker has not the attainments to fit him for the office?
Mr CUNNINGHAM:
– I say that the Government and their supporters did not elevate him to his present position because they considered he had the necessary attainments, but simply to get rid of him. In the course of time, when, as inevitably happens to the occupant of the Speaker’s chair, his prestige as a fighting man has been lost, and he is no longer a factor in political warfare, he, in his turn, will be beheaded and another placed in his position. Thus the chair becomes a block instead of a chair to which dangerous political opponents are elevated, only, later, to lose their political heads! I urge on those honorable members who have no chance of getting into the Caibi.net to look at this matter from the point of view of the people, and ask themselves if, in connexion with the sale of the woollen mills, the taxpayers of the Commonwealth have received a fair deal? I am satisfied that if the honorable member for Martin (Mr. Pratten) had owned the mills, he, with his keen knowledge of business, would never have assented to their disposal in such a manner, and so I ascribe what has happened to the incompetence of the occupants of the Treasury bench. They have come into prominence, not so much because of their ability as because of their political intriguing. Their policy has never been indorsed by the people, and I am confi dent that this latest transaction will be resented at the ballot-box when next we face the electors.
Mr Prowse:
– “Which ballot-box?
Mr CUNNINGHAM:
– The ballotbox that will be used when the honorable gentleman is put out of Parliament. I repeat that the policy of the Government has never been indorsed by the people. Ministers have no mandate to govern. Honorable members on this side of the House have been charged with delaying the business of the country and with being obstructionists. It costs approximately £150,000 a year to run the Commonwealth Parliament. If we were to sit here for twelve months instead of one week debating only this question, and if, as the result of our protest, we could save the woollen mills, we would be able to show a profit to the people. The Government have lost the respect of their own supporters, if not in this House, then, certainly, outside. It has been well said that good business men invariably make indifferent public men, because, owing. to their business training, they are unable to consider matters from that broad stand-point so essential if the affairs of the country are to be administered successfully. The Government stand discredited in connexion with the sale of the Geelong mills. I have conversed freely with their . supporters throughout the country, and I am satisfied that when they read the Prime Minister’s statement to-day they will be confirmed iri their belief that the Government no longer deserve their confidence. The Prime Minister’s speech this afternoon contained not one definite statement in refutation of the charge made by the honorable member for Yarra (Mr. Scullin), and I am firmly convinced that very many honorable members opposite believe that in the disposal of the mill at the price the people of the Commonwealth have not had a fair deal.
Mr YATES:
Adelaide
.- I do not intend to delay the House for long. If I did I would be paying’ no compliment to the honorable member for Yarra (Mr. Scullin), who submitted the amendment this afternoon. But I wish to express my appreciation of the manner in which he stated his case. The .Prime Minister (Mr. Bruce) said that the honorable member for
Yarra (Mr. Scullin) had treated this transaction as a political matter. It has indeed been smellful in the highest degree, and the honorable member for Yarra might well be congratulated for having laid bare the facts about it. The trouble, from the Government point of view, is that he was too truthful, and so the Prime Minister made an attempt to side-track the issue and to make the people believe that the amendment is only part of a political game. The Leader of the Government asked why we did not follow the well-established custom of having our criticism on the AddressinReply taken in globo. No doubt that course would be acceptable to the Government, because a lot of very important matters would then pass unnoticed. We are determined, however, to place our fingers upon the weak spots in the administration of public affairs in order that the people may understand what is being done by the Government. Never in the history of the Commonwealth has a charge been more clearly and fairly placed before the House than was the case this afternoon when the honorable member for Yarra submitted this motion of censure. His handling of it will redound to his everlasting .credit. He was fair to the minutest degree. He took the departmental figures and facts, so it was impossible for the Prime Minister to refute them. Yesterday, in flamboyant terms, the Leader of the Government asked why we could not be fair, and why, when we objected to the session being limited to ten weeks, we did not admit that the Fisher Government in 1911 closed . down Parliament for nine months. Then when I asked him why he could not be fair and say that in 1911, twenty-two members of the Commonwealth Parliament went Home to the Coronation festivities, he closed up like an oyster and said no more. So much for the Prime Minister, when he wants to gain his point. He occupies his present position by virtue of the fact that he is a business man. We were told that business men were wanted in this Parliament because they would better be able to control the affairs of the Commonwealth. -Well, the people placed a business man at the head of the Government, and he will be judged by this scandalous betrayal of the people of Australia in connexion with the “business like “ transaction which the honorable member for Yarra has exposed. In order to divert attention from the real issue, he resorted to subterfuge, and made the base accusation that the amendment was moved to secure party advantage. If ive had allowed this transaction to pass without comment we would have been told by the people in no uncertain terms that in the words of the ex-Assistant Minister for Defence (Sir Granville Ryrie) “ they had been sold a pup.” The first question members on this side of the Chamber would have been asked would have been, “ What did you do when the people of Australia were betrayed by the sale of the Geelong Woollen Mills ?” The honorable member for Yarra (Mr. Scullin) has done what he has been sent here to do, and has done it well. He is performing his duty in the interests of his constituents just as the Prime Minister (Mr. Bruce) is endeavouring to work on behalf of the business interests of Flinders-lane which, as the present Postmaster-General (Mr. Gibson) said before the formation of the present Ministry, were the money masters of the late Government. The Postmaster-General now bows and scrapes to this man as his Leader.
Mr DEPUTY SPEAKER (Mr Bamford:
HERBERT, QUEENSLAND
– The honorable member for Adelaide (Mr. Yates), having spoken on the main question, must now confine his remarks to the amendment before the Chair.
Mr YATES:
– 1 am confining myself to the language used in the amendment of the honorable member for Yarra, and showing the insincerity of the present Postmaster-General, who made - use of the words I have quoted. I am merely twitting the Minister for his changed attitude in regard to the sale of the mills. The Prime Minister (Mr. Bruce) is doing his job” for the moneyed interests which control the Government, but he is not performing his work as cleanly or as efficiently as the honorable member for Yarra, who has placed all his cards on the table. He has given the source of his information, which has been clearly examined, and, in fact, he has told the House that when he was not satisfied with the advice of one expert he went to another in order to deal fairly with the Government. Notwithstanding this, it has been inferred that the honorable member is insincere in his attitude. He was outspoken and truthful, and, despite the interjections from honorable members opposite, was able to demonstrate in the most effective manner that our policy of the socialization of production, distribution, and exchange is one that would be of benefit to the community. Honorable members opposite accept that portion of our policy which suits them, and ridicule that which is unacceptable to them. The honorable member for Macquarie (Mr. Manning) a day or two ago was advocating the payment of a subsidy to steamers trading to the East. To benefit whom? Was it for the purpose of finding an outlet for our markets or for subsidizing companies controlling steamers which would be worked by Chinamen or members of coloured races?
Mr DEPUTY SPEAKER:
– The honorable member is again deviating from the amendment before the Chair.
Mr YATES:
– I may have gone as far as the East, but I shall now return to the dead centre in Melbourne, and deal further with the sale of the Geelong Woollen Mills. Are the so-called representatives of the primary producers, which the Commonwealth Line was established to benefit, prepared to tell their supporters that they are- in favour of scrapping the’ steamers ? They are not as open and honest in regard to their policy as the honorable member for Yarra was with the one he enunciated this afternoon. They are in favour of retaining the line; but say it is only a question of what ships will pay. The Commonwealth Woollen Mills have paid handsomely, and are likely to continue doing so; only the profits from the undertaking will pass into the hands of private individuals instead of benefiting the whole community. Through the medium of Ilansard my words will reach the masses of the people, and may be of assistance in bringing about even greater support for our policy of the socialization of production, distribution, and exchange. The time is not far distant when it will be unnecessary for the sons of capitalists to be placed in charge of State enterprises. At present we have to draw the heads of such concerns from the sons of men engaged in Flinders-lane warehouses, in banks, shipping companies, and other commercial institutions throughout the State, and, naturally, they are reared in an environment which prevents them making the businesses they are conducting the success they would otherwise be. When matters can be so adjusted that men whose interests are similar to ours are in control of undertakings such as that under consideration, they will be managed in such a way that their value to the people cannot be challenged. The Government have no right to dispose of what is unquestionably a valuable asset in such a way as to make it appear that a forced sale was necessary. The Commonwealth is not bankrupt. If the time was unsuitable, and the Government could get an offer of only £150,000 for what is worth practically £250,000, they were not justified in acting as they did. The words of the honorable member for Yarra will reach more than the supporters of the Labour party, and the fair-minded and level-headed people of the Commonwealth will show their disapproval of the actions of the supporters of the present Government as they did in South Australia at the last general election. When the next appeal is made to the people it will be found that the Labour party will return with an even greater number of the scalps of their opponents than they got on the last occasion. The honorable member clearly demonstrated this afternoon what can be done under Government control, and it will not be long before this Chamber is composed of men who will not only strongly oppose the disposal of an important and successful industry, but will be in favour of establishing others. The honorable gentleman says that the use to which it is proposed the Commonwealth Woollen Mills should now be put is totally foreign to what was originally intended by the Labour party when they were established. In other words, he declares that it was not the intention of that party to carry the manufacture of woollen cloth to the extent which would be necessary if the Government were to retain the mills. He is very ingenuous in making that statement, because it was the intention of the Nationalist Government to carry on the mills for the purpose of supplying the public. Seeing that an amount of £45,000 was provided on the Estimates for the purpose of extending the mills, it is quite evident that until the Minister who was in favour of retaining the woollen mills was “scrapped” in. the interests of Flinders-lane, Ministers were prepared to extend operations and furnish that larger range of patterns which was necessary ito enable them, to compete with private enterprise. At any . rate, until the present Ministry was conceived, as it was, in political iniquity, there was no intention of making this establishment a free gift to the moneyed interests which now control the Cabinet. I wish I could hear the honorable member for North Sydney (Mr. ‘.Hughes) upon this subject. I would like to hear him speak again in that spirit in which he lived before he betrayed the workers of the Commonwealth. I wish that men would be honest throughout their lives, and that gifts of £25,000 would not tempt them away from their natural inclinations. ‘I would like also to hear the ex-Minister for Defence (Senator Pearce) tell the truth in regard to what was intended when these mills were established. The Prime Minister knows well that he was misstating the position when he said that it was not the intention of those who established the Commonwealth Woollen Mills at Geelong to carry on in competition with private enterprise. He knows that it was the policy of the Labour party to have everything possible made in Australia, by Australian workmen, for Australian people. Would the people of the Commonwealth approve of the attitude taken up by the honorable member for Yarra, who seeks to give them cloth from their own mills at 6s. a yard ? Or would they rather uphold Flinders-lane, which would sell them the same cloth at 32s. 6d. a yard? The Prime Minister declares that the speech of the honorable member for Yarra will most likely be pamphleted and distributed throughout Australia, But there is nothing to prevent him from pamphleting his reply and distributing it in the same way, so that the people may be able to judge ‘between the two statements. If it were left to the dinky-dye Aussie to give his judgment,” I would ‘be prepared to accept it.
It is no compliment to the honorable member for Yarra” for any other member to go over matters that he has already set out so clearly and thoroughly, but there is one thing to which I wish to draw particular attention. The Returned Soldiers’ Association were willing to take over the mills, but their circumstances would not permit them to finance such a big undertaking. The honorable member, for Yarra suggested, as is shown in the correspondence^ that they should have been afforded a little more time and given some assistance, so that they might be in a position to take over the mills on behalf of the men who paid a heavy price overseas in order to make Australia secure. If the Government had given the mills to them, the soldiers would not have got one-half of what was promised to them when they went away to fight for Australia. The ‘Government would give them neither terms nor assistance to enable them to acquire the mills, but when it was a matter of drawing up conditions under which Flinders-lane, a member of the Senate, and a relative of the unofficial private secretary to the Prime Minister could get the mills, the rate of interest was reduced from 6 per cent, to 5£ per cent., ten instead of five years in which to make the payments were stipulated, and a deposit of 10 per cent, instead of the 33.3 per cent, for which the Government had asked, was accepted. Why could not the soldiers get the favorable terms which were available to persons who were purchasing the mills for business purposes, and, in all probability, so that they might be in a position to use some idle wealth? And why did not the Prime Minister touch on that point in his reply? Simply because he does not believe in the policy of extending preference to returned soldiers.
Mr LISTER:
Corio
.- It is only fitting that I should say something with regard to the amendment. It is deplorable that those who happen to disagree with the Opposition on the occasion of no-confidence motions have to submit to being dubbed, by inference, men without principle. If lie charges levelled against the Government by the honorable member for Yarra (Mr. Scullin) could be substantiated, he would have done right in bringing his amendment forward, and every honorable man would be bound to support him.
Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP
– Do you support the appointment of a Royal Commission to inquire into the question?
Mr LISTER:
– I wish to see justice done to everybody concerned. I have always stood for what is right, and I think honorable members opposite will give me credit for taking that attitude. I happen to represent the constituency in which the woollen mills are situated, and I find that there is not such a keen interest in the sale of the mills in the city of Geelong as some honorable members suggest. I have in mind a visit paid to Geelong, when the sale was first proposed, by two gentlemen who were detailed to speak at a meeting of protest. I refer to the honorable member for Yarra (Mr. Scullin) and the member for Flemington in the Victorian Legislative Assembly (Mr. Warde). An indignation meeting was freely advertised, and notices appeared in the press day after day, but there was so little interest shown in the gathering that, although the night was fine, fewer than 400 people attended.
Mr Scullin:
– Ten times as many as were present at your election meetings.
Mr LISTER:
– That is not a fact. I opened my campaign with a meeting at which there was an attendance of 1,250 people. I took it as a distinct compliment that my electors were so satisfied with my services as their representative that they did not consider it necessary on every occasion to attend to hear what I had to say. At the time of which I speak, there were about 340 employees in the woollen mills, and one might have supposed that a larger attendance than 400 would have been attracted to a well-advertised indignation meeting. A - considerable number of those present were in favour of the sale of the mills. Frequent conversations with the employees led me to think that quite a number were in favour of the Government disposing of the establishment, believing that under private enterprise their own interests would be better served, and the industry more satisfactorily developed. When on the public platform, I always advocated the sale of the mills, but that fact did not lead to my defeat at the elections, despite the argument of honorable members opposite that candidates had been rejected for favouring the disposal of the undertaking as a Government enterprise. There is a lot of truth in the statement of the Prime Minister that honorable members opposite are anxious to make political capital out of the transaction. The . people in the electorate were quite satisfied that the mills should be handed over to private enterprise. The honorable member for Adelaide (Mr. Yates) wanted to know why the Returned Soldiers Association was not given an opportunity to purchase the mills. Prior to the decision to sell them, the soldiers themselves were negotiating for the establishment of mills at Geelong, and a Bill was passed authorizing the Government to loan to the Geelong Returned Soldiers and Sailors Woollen and Worsted Co-operative Manu.facturing Company a sum not exceeding £50,000. After a thorough canvass of Australia, almost from one end of it to the other, they obtained promises to take up £65,000 worth of shares. That fact demonstrates the impossibility of the soldiers financing this proposal and paying the amount or anything like the amount that has been charged to the syndicate purchasing the mills.
Mr Scullin:
– The soldiers said they could do it if they were given a chance.
Mr LISTER:
– The fact remains that they could not raise more than between £60,000 and £70,000 capital.
Mr Mahony:
– The Geelong Advertiser said something very different from that.
Mr LISTER:
– I do not think it did, but if the honorable gentleman can find the extract for me, I shall be prepared to accept his statement. The honorable member for Yarra (Mr. Scullin) was justified in stressing the success ‘ of the mill in the past. That success, I think, is admitted by everybody, and there were reasons, apart from those which have been advanced, for it. The first reason was that the Government was exceptionally fortunate in securing the services of Mr. Smail as manager, and a very capable man as his successor when he went over to Vicars, at Marrickville, in Sydney. The mill has been successful because of excellent management. The Government had brains enough to let the manager .do the managing; it did not interfere with him in matters which were his ‘especial business. A second reason for the success of the mill was that the manager, when he desired to make purchases of wool to carry on the season’s work, had almost unlimited cheap capital at his disposal. Such an advantage is not often enjoyed by concerns of this kind. Many private firms have been very severely handicapped because they could not lay their hands on sufficient money to make purchases at the time which was most suitable for the successful carrying on of their business. Another reason for the success of the mill is the fact, which is not generally known, or, at least, is not generally admitted, that it incurred no expense for distribution. The Prime Minister touched upon certain aspects of this matter in his reply to the honorable member for Yarra (Mr. Scullin), but there was one phase to which he did not refer. If the Government had continued this mill, it would have had to appoint a large army of men of various grades to distribute the products.
Mr Mahony:
– That is absolutely ridiculous. -Mr. LISTER. - It is not absolutely ridiculous. The distribution of the output of the mill was undertaken by the Ordnance . Branch of the Defence Department, and the success of the mill was due very largely to the fact that it never had any charges set against it in that connexion.
Mr West:
– That is not the same statement that the honorable gentleman made at Geelong.
Mr LISTER:
– It is. I have always, been frank in expressing my views on this question. I wish to emphasize the fact that the position has changed, and that the prospect of carrying on the mill successfully in present circumstances is extremely remote. I am given to understand that there are mills in Australia which are working at unremunerative prices in order to keep their employees together. They are continuing to manufacture in the hope that better days will come-, when they will be able to make up their leeway. The various State Governments in the past have been very large customers of this mill. Honorable members generally may not know that the Government of New South Wales has given a 10 per cent, preference to the manufacturers of that State, and has ceased placing orders in “Victoria. The Victorian Government has accepted higher tenders than those submitted by the Commonwealth Mill, because Commonwealth concerns are not subject to State income tax. Apparently the State
Governments are allowing State jealousy to determine their policy, and this is not conducive to the best interests of the country generally. I hurl in the teeth of those who made them the charges that members of this side of the House are under the domination of the National Union, and have been the recipients of party funds from that organization. I have been in this House for six years, and I say quite distinctly that the National Union has never, to my know- , ledge - and I have a fairly good grasp of what is taking place - contributed a penny piece to my election expenses. On my return from the Front the people of Geelong elected me to ‘the National Parliament and defrayed my election expenses, without making any call upon the National Union in Melbourne. They indorsed my selection in defiance of the “ powers that be “ who operate in Melbourne. I say, quite truthfully, . that the same spirit has been -shown by the people of Geelong at later elections. I have been twitted for’ supporting the sale of the Commonwealth Woollen Mills because I was a returned soldier who applied for shares in the returned soldiers’ mill at Geelong; that I had an ulterior motive in advocating the disposal of the mill; and that I ‘took that attitude for purely personal reasons. My sincerity in this . regard is shown by the fact that I declined, and still decline, to accept shares in the soldiers’ mill, notwithstanding that I believe it will be a good proposition. I do not intend to give any man an opportunity to say that I supported the sale of the Commonwealth Mill because I had a personal interest in a rival concern. That has been my attitude throughout. Honorable members who are intimate with me know that ever since I entered this Parliament I have been actuated by the” very highest motives, and I assure this House, and the country generally, that I have not allowed personal considerations to influence me in supporting the sale of the mill. It is in the best interests of the people I represent that the mill should be disposed of to private enterprise in view of the possibilities of greater development, and unless I am given more substantial evidence of corruption than has been shown to honorable members today, I shall still persist in supporting the action of the Government.
Question. - That the words proposed to be added (Mr. Scullin’s amendment) be so added - put. The House divided.
AYES: 26
NOES: 0
Majority . . 8
AYES
NOES
Question so resolved in the negative.
Amendment negatived.
Debate (on motion by Mr. Blakeley) adjourned.
page 236
SPECIAL ADJOURNMENT
Motion (by Mr. Bruce) agreed to -
That the House, at its rising, adjourn until to-morrow at 2 30 o’clock p.m.
page 236
ADJOURNMENT
Unemployed Deputation : Main Road Development
Motion (by Mr. Bruce) proposed -
That the House do now adjourn.
Mr BRUCE:
Prime Minister and Minister for External Affairs · Flinders · NAT
– I received to-day a deputation of the unemployed in the city of Melbourne and in the State of Victoria. I admit that I took a rather unusual course in receiving them, but I think that my honorable friend (Mr. Charlton) will forgive me and believe that no lack of courtesy towards him governed my action. . The deputation presented their case to me and indicated the great hardship that they were suffering because of the winter. They also pointed out that the great percentage, if not the whole, of their number were anxious and willing to find employment, but were unable bo do so. I naturally replied to the deputation that one had every sympathy with people who desired to find work, but who, unfortunately, could not do so. I pointed out, of course, that it was primarily for the State to take action, but that the Commonwealth was very sympathetic, and so far as it could help Victoria or any other State which was faced with the unemployed problem, it was desirous of doing so.
The Government have given consideration to the matter, and are prepared to give effect to the proposal which we outlined at the Conference with State Ministers. We there indicated to the States that we were prepared to advance £500,000 for main road development, and that that sum would be distributed - as to £300,000 on a population basis, and as to £200,000 on an area basis. We made it very clear that the money was not to be spent on necessary road construction that the States themselves would otherwise have to undertake; our proposal was merely a recognition by the Commonwealth of the paramount importance in Australia of good means of communication as an aid to development. The roads on which the money is to be spent must be such as will open up new country for agricultural, pastoral, and mineral activities, and give access to railways or main thoroughfares to facilitate the marketing of produce. The proposal which we have suggested is a sound and economic one.
We are desirous of going on with this matter because we are certain that, if the necessary measure can be put through this House, the States will immediately avail themselves of some part of our offer, and, perhaps, that will assist in finding soma solution of this problem of unemployment, which, of course, is a serious one for those concerned; although, fortunately, not nearly so serious in Australia as in every other country. The Government are prepared to make this an urgent measure, and to go on with it as soon as we can get rid of the debate which is taking place upon the AddressinReply.
Mr CHARLTON:
Hunter
.- Mr. Speaker-
Mr SPEAKER (Rt Hon W A Watt:
– The utterance of the Prime Minister has closed the debate. If the honorable member desires urgently to speak, no doubt the House . will give him permission to do so.
Leave granted.
Mr CHARLTON:
– I shall not abuse the privilege which has been granted me. I quite understand that the speech the Prime Minister made closes the debate on the motion for adjournment; but as this is such an important question, and as the Prime Minister did not mention it when we had a chance of discussing it, I think the House has extended to mo a courtesy to which, in the circumstances, I am entitled.
We on this side of the House are very pleased, indeed, to hear from the Prime Minister that the Government intend to make available the amount of money mentioned at the Conference with State Ministers. We regard this, not so much as a question of urgency as far as this House is concerned, as one of urgency as far as . the States are concerned. Sufficient of the £250,000 granted twelve months ago is still unexpended to find employment for the unemployed in Melbourne to-morrow. I ask the Prime Minister to look into that statement and see if it is not correct. This Parliament twelve months ago allocated to the States on a population basis the sum of £250,000. Three weeks ago I asked my secretary to ascertain . whether that money had been expended. Although thousands of men are unemployed, only about two-thirds of that amount has been expended. Now we ‘ have this matter mentioned by the Prime Minister in a speech which precludes further debate in an endeavour to make political capital out of it.
Government Members. - Oh, no!
Mr CHARLTON:
– I hope that the Prime Minister will ascertain what amount of that money is still unexpended, and see that these men aro given employment by the State Governments immediately, instead of waiting for this House to take further action. We on this side will do in a legitimate way everything we can to help the unemployed of this country.
Question resolved in the affirmative.
House adjourned at 10.38 p.m.
Cite as: Australia, House of Representatives, Debates, 20 June 1923, viewed 22 October 2017, <http://historichansard.net/hofreps/1923/19230620_reps_9_103/>.