9th Parliament · 2nd Session
Mr. Speaker (Rt. Hon. W. A. Watt) took the chair at 3.30 p.m., and read prayers.
Terms of Reference
– Have the terms of reference in the sugar inquiry been determined, and if so, what are they? A responsible officer of the Public Service has been relieved of duty pending this inquiry, and the matter should be expedited.
– I am informed that the Attorney-General’s Department has now practically completed the terms of reference. I hope to be in a position tomorrow or Friday to indicate what they are.
– I notice that the Prime
Minister, speaking on Tuesday, at the luncheon tendered to him by the Victorian Institute of Advertising Men, complained that life in Australia is far too easy. I ask the Prime Minister whether there is anything we, on this side of the House, can do to make it a little more strenuous?
– In any caseI sug gest that the attempt should not be made in the House.
Mr. BAYLEY, as Chairman, presented the report on War Service Homes Dis posals.
Ordered to be printed.
asked the PostmasterGeneral, upon notice -
Whether he willplace on the Librarytable the Departmental file dealing with the case of T.C. H. Hayward?
– Hayward was dealt with by a Board appointed under the provisions of the Public Service Act. It is not the practice to make the papers in such cases available.
asked the Treasurer, upon notice -
– I am not in a position to furnish the information asked for, as Parliament has placed the control of the note issue in the hands of the Note Issue Board. I shall, however, cause inquiry to be made.
asked the Minister for Works and Railways, upon notice -
– No. Tenders and alternative tenders have been received, and these are now receiving earnest consideration.
Mr.FENTON (for Mr.Forde) asked the Treasurer, upon notice -
In view of the discussion that took place on the Estimates, and of his promise that he would see that the ligh thousemen, and others who were taken over by the Commonwealth Service within the last ten years, would get the benefit of the superannuation scheme, will he, if necessary, introduce an amendment ofthe Superannuation Act before the session closes?
– This matter is under consideration.
Grant to Migrants
Mr.FENTON (for Mr. Coleman) asked the Prime Minister, upon notice -
– Assuming the honorable member’s question refers to grants for passage money, the reply to his question is as follows : -
The British Government, through the Overseas Settlement Office, London, provided free passages to Australia to British ex-service men and certain dependants, and to British exservice women, whose applications were lodged with and approved by the Overseas Settlement Committee before 31st December, 1921, and who were accepted by the Commonwealth Migration andSettlement Office, London, as prospective settlers for Australia. The Overseas Settlement Committee definitely agreed to make this free passage grant available at any time during the year 1922,provided the persons concerned had duly registered their applications with the Overseas Settlement Office before 31st December, 1921. The Overseas Settlement Office made it quite clear that any exservice migrants who left Great Britain after 3 1st March, 1922, without obtaining free passage grants, would not be entitled to any refunds of passage money.
Duties - Estimating Clerk - Secretary
asked the Prime Minister,upon notice -
– The answers to the honorable member’s questions are as follow : -
Cost of Delegation
asked the Prime Minister,upon notice -
Mr. Bruce, Prime Minister; Senator Wilson, Assistant Minister for Trade and Customs; Sir Robert Garran, Solicitor-General; ViceAdmiral Sir Alan Everett; Mr. R. McK. Oakley, Comptroller-General of Customs, and Chairman of the Tariff Board; Mr. P. Strahan, Assistant Secretary, Prime Minister’s Department; Mr.F. Ainsworth, Foreign Secretary, Prime Minister’s Department; Mr. A. W. Smith, Secretary; Mr. A. Russell, Unofficial Personal Secretary to Mr. Bruce; Mr. E. Carter, Private Secretary to Senator Wilson; Mr. F. M. Cutlack, Publicity Officer?
– A statement giving the desired particulars is being prepared.
Bill returned from the Senate without amendment.
The following paper was presented: -
Papua Act - Infirm and Destitute Natives Account - Statement of transactions of Trustees, 1922-23.
In Committee (Consideration resumed from 21st August, vide page 3192) :
Clause 5 - (Taxation of companies) .
– I desire some information on this clause with a view to moving an amendment to subsection 3 of section 20 of the principal Act, which reads -
A company, notwithstanding any contract, agreement, or arrangement entered into by it, may, with the approval of the Commissioner, charge pro ratâ, the amount of the tax actually paid by it against those beneficially interested in the income of the company.
The object that I have in view is to compel persons resident abroad who receive income from company operations in Australia to pay the same amount of tax on that income as would be payable if they resided in Australia. I understand that the provision of the Bill is that such persons shall simply pay the company rate of1s. instead of the full rate chargeable on their income.
– The honorable member is referring to a graduated basis.
– That is so. The present position is that absentee shareholders, say, of one of the big pastoral companies of Australia, or of the firm of Paterson, Laing, and Bruce, which have their head-quarters in London, deriving their income from profits earned in Australia, are taxed in Australia at the companies’ rate, which is now being reduced from 2s. 5d. to1s. On the other hand, an Australian shareholder, receiving a large income in Australia from the same source pays at a higher rate. I shall give an example to drive the facts home. An absentee shareholder drawing £7,500 in dividends from a company earning its profits in Australia, would pay £375 annually in income tax. Another shareholder, living in Australia, and drawing the same amount of income from the same company, would pay £2,118. This is not something new, because this evil has existed for a long time.
– What particular clause is the honorable member referring to?’
– I propose to add a new proviso to clause 5 dealing with sec tion 20 of the principal Act, which will place the two shareholders I have described on the same footing respecting incomes derived from an Australian company. It is only fair to correct this anomaly in the principal Act. In the instance I have given, the absentee shareholder pays a rate of1s. in the £1 on £7,500, and the shareholder in Australia pays approximately 5s. in the £1. The present company rate is 7d. in the £1, but it is now proposed to make it1s. in the £1.
– Companies will really be in a worse position than before.
– Certainly. The Government will obtain an advantage in that respect, but still the rate is a long way from equitable. I wish to insert an amendment that will compel shareholders outside Australia to pay a graduated rate according to the income they enjoy, whether that rate be5s. or 6d. in the £1. I am referring, of course, to dividends earned in Australia. I move -
That the following proviso be added to subsection 3 of section 20 of the principal Act : -
Provided that, in the case of a company which has its head office located outside Australia, it shall, where the total Australian assessable proportion of dividends and interest, including debenture interest paid to each absentee shareholder, depositor, or debenture holder, exceeds £721, pay income tax on such total assessable sum at the rate the shareholder, depositor, or debenture holder would be required to pay if the head office of the companywere located in Australia.
– The amendment that the honorable member for Yarra has moved will not add to the legislative power of the statute already given in section 65 of the principal Act. Companies that have their head-quarters outside Australia, although deriving income from Australia, are, for the purpose of the Act, regarded as foreign companies, and the tax on their absentee shareholders is raised by this Bill from 7d. to1s. in the £1. Under the Income Tax Assessment Act of last year, the tax on companies was 7d. in the £1, that being regarded as a fair average rate. The absentee company holding shares in another company which derives income from Australia will not be taxed on the dividends received from the Australian company. The new rate fixed for companies, of1s. in the £1, will have to be paid on the dividends the companies declared. But any absentee shareholder whose dividend would carry tax at a higher rate than1s. is, at present, liable to be assessed for the additional tax.
– Under what section?
– Section 65. The difficulty is that shareholders who are absentees are individually beyond the jurisdiction of the Commonwealth, and, therefore, the Act provides that the company shall pay tax on dividends distributed to absentees in addition to the company’s own tax.
– I understood that a decision was given that they were beyond Commonwealthjurisdiction because no provision was made for them in the Act.
– The difficulty is to recover the tax from those who reside outside the Commonwealth. Where possible, this is done through the company, but where the company has no power to deduct payment from the shareholder, the Commonwealth is unable to recover the tax from the shareholder. We can assess, but we cannot collect.
– A provision should be inserted requiring the company to collect.
– The company cannot always collect in such cases.
– If the Commonwealth assess at1s., they can collect the tax.
– Where possible, we collect the tax through the company.
.- The explanation of the Treasurer does not cover what the honorable member for Yarra has in mind. It is evident from the Treasurer’s statement that absentee shareholders, who derive large incomes from Australian companies with headquarters outside Australia, pay a very small income tax compared with that of shareholders resident in Australia. This anomaly should be remedied. Although the Bill proposes to increase the company rate from 7d. to1s., the tax is still inadequate. Some provision should be made to deal specially with foreign companies. The Treasurer pointed out that, at present, we had no power to collect the tax outside Australia, but that we have the power to assess the flat rate which is fixed for companies in Australia. In order to obviate the difficulty of collecting tax, all we have to do is to provide that in connexion with these com panies taxation shall be paid at a certain rate by shareholders resident outside Australia. It is very unfair that Australian shareholders in companies having their head offices abroad should have to pay the highest rate of tax applicable to their incomes in Australia, whilst shareholders of the same company living outside of Australia escape with the tax of1s. in the £1 now proposed as the company rate. The view may be considered somewhat far-fetched, but I direct attention to the fact that we are spending a great deal of money in order to induce people to come to Australia, while at the same time, we enable people outside of Australia whose incomes are derived from the profits of companies operating in the Commonwealth to escape taxation which is levied upon residents of the Commonwealth. That is not likely to promote settlement in Australia. As a result of the existing position, we may have large companies purposely establishing their head offices outside of Australia, to enable their shareholders resident abroad to avoid the payment of income tax to the Commonwealth. All shareholders of a company earning profits in Australia should bear an equal share of the burden ofour taxation, because people abroad who invest their money in these companies do so only because they regard their shares as a good investment. We have expended very large sums during recent years to keep everything right in Australia and the Empire, and the people to whom I refer should bear their share of the burden which that expenditure has imposed upon the Commonwealth. The honorable member for Yarra (Mr. Scullin) mentioned some of the companies operating in Australia that have their head offices in London. I can refer honorable members to another, the Scottish Australian Land Development Company, which carries on separate operations in connexion with a coal interest. This company has its head office outside of Australia, and although all its operations are carried on here, and the whole of its profits are earned here, absentee shareholders of that company are required to pay less than half the Commonwealth taxation which resident shareholders of the same company have to pay. I do not suggest that absentee shareholders of these companies should be called upon to pay a higher rate of income tax than is required from resident shareholders, but they should pay the same rate of tax.
– That would not be likely to encourage capital to come into the country.
– We have often heard that statement about capital, but those who have capital to invest will always go where they can invest it to advantage. Australian shareholders of these companies will be taxed, not at the proposed company rate of1s. in the £1, but at a rate of approximately 2s. 2½d. in the £1, and why should not shareholders living outside of Australia and deriving their income from the same company pay an equal amount of taxation?
– They might try to invest their money elsewhere.
– The fact remains that it is invested here, and these companies have never endeavoured to get rid of their Australian properties. The company to which I have referred, has been operating in Australia since I was a boy, and has increased its interests in the Commonwealth. Many of the companies which we relieved of hundreds of thousands of pounds of taxation by the Bill which we considered last night are also concerned in this measure, and so their absentee shareholders will be given double relief as compared with Australian shareholders interested in the same concerns. If there were any preference provided for, the Australian shareholders should receive it. That might encourage people to settle here, and discourage the monopolization of our industries by companies established abroad. If people abroad do not think that they will get a better return for investments in Australia than elsewhere they will not invest their capital here. Companies operating in connexion with the land have, because of the advance in the price of wool, made more money since the war period than they ever made previously. Absentee shareholders of those companies have derived more wealth from their operations than theycould have anticipated, and they should certainly be called upon to share equally with resident shareholders in the same company the expense which the people of the Commonwealth have to bear to carry the baby for them. I appeal to the Treasurer to submit the amendment which has been suggested by the honorable member for Yarra (Mr. Scullin), because I feel sure that if the honorable member moves the amendment it will be defeated. No matter how sound the argument may be in support of an amendment submitted from this side, it is defeated because we are in a minority.
– We had a win yester- day.
– Yes, we had; thanks to a few honorable members on the other side throwing in their weight with us. We do not look for political kudos in connexion with this matter, and I appeal to the Treasurer to submit some amendment in connexion with this Bill to provide that people living abroad, who are deriving large incomes from profits earned by companies operating in Australia, shall at least pay the same rate of income tax to the Commonwealth as Australians interested in the same companies are required to pay.
– There is a certain amount of misapprehension regarding this clause. When I last spoke I referred to the legislative authority necessary to give effect to what the honorable member for Yarra (Mr. Scullin) has in mind. I tried to make it clear that that legislative authority is already embodied in the existing Act. What the honorable member desires could not be satisfactorily effected by an amendment of this Bill, but would require an. amendment of the Act fixing the rates of tax. I might explain the position. There is, first, now a flat rate on the total profits of the company, which, under this Bill, will be1s. in the £1. Previously the tax was 2s. 5d. in the £1 on the undistributed profits only.
– And in the case of absentee companies, on all profits.
– No ; but absentee shareholders were called upon to pay a special rate of 7d. in the £1, which was collected from the company. That was regarded as a fair rate, spread over the bulk of the shareholders in companies operating in Australia, and having their head offices outside the Commonwealth. Honorable members will understand that a British company operating in Australia will have big as well as small shareholders, and the additional rate of 7d. in the £1 was regarded as fair, in view of the flat rate of 2s. 5d. in the £1 charged on undistributed profits of these companies. It is now proposed that the special rate of 7d. in the £1 shall be increased to1s. in the £1. Under this Bill there will be a flat rate of1s. in the £1 on the whole of a company’s profits earned in Australia, and absentee shareholders of such companies will thus have to pay a special rate of1s. in the £1. The special rate imposed on absentee shareholders is collected from the companies in Australia.
– I suggest that we might effect what is desired by providing that in addition to the company rate of1s. in the £1 these companies should be required to pay in respect of dividends distributed to absentee shareholders taxation at the rate which those shareholders would have to pay if they were resident in Australia.
– There is a difficulty in fixing a rate which it would be easy to collect.
– If, as the Treasurer proposes, the special rate on absentee shareholders is to be raised from 7d. to 1s. in the £1, could not that rate be raised to the equivalent of the income tax rate which resident shareholders of the same company will have to pay in Australia ?
– There is some difficulty in imposing taxation on people resident outside of Australia, and in collecting that taxation. Honorable members will recognise that it would not be an easy matter to tax a company shareholder living in a village in Yorkshire. The desired amendment should be made by an alteration of the rates Bill.
– I see nothing in the principal Act to give the Government this legislative power.
– I direct the honorable member’s attention to section 65, which provides -
1 ) The Commissioner may, by notice in writing (a copy of which shall be forwarded to the taxpayer to the last place of address known to the Commissioner), require -
– Butwe want the amount stipulated.
– The actual amount should be set out in the rates Bill.
Mr.LAZZARINI (Werriwa) [4.19].- I hope the amendment submitted by the honorable member for Yarra (Mr. Scullin) will be accepted. If we can raise the rate levied upon foreign investors in Australian companies from 7d. to1s. in the£1, we have only to extend the principle and increase the rate to any amount the Committee deems desirable. The foreign investor should pay, at least, the same, if not a higher, rate than company shareholders domiciled in Australia. The clause as it stands is a direct encouragement to persons with money available for investment to establish the head office of an Australian company in a foreign country, Britain, for the purposes of this Act, being regarded as a foreign country.
– In that event they would have to pay double income tax.
– It does not necessarily follow that they would. So far as Great Britain is concerned, there has been an adjustment with Australia in that matter. The clause in its operation will retard the development of this country, and I am opposed to it.
.- I could not follow the line of reasoning taken by the honorable member (Mr. Lazzarini) who has just resumed his seat. Nor could I quite follow the Treasurer (Dr. Earle Page) on the two occasions when he rose to reply to the point raised by the honorable member for Yarra (Mr. Scullin). It seems to me that one of the principles of our income taxation, to which the Treasurer did not refer, is that shareholders in Australian companies whose head offices are not in Australia, and who have invested their money for the development of Australia, shall not be taxed twice. The English Income Tax Act taxes English investors on their domicile without regard to where the profits on their capital are earned. If we follow the suggestion of the honorable member for Yarra and tax the individual assessments of foreign shareholders in companies operating in Australia, nearly the whole of the profits made in Australia would be absorbed, because those shareholders would also be taxed at the very high present rates of the British income tax. Thus a most insidious form of double taxation would be encouraged. I believe that the party represented by the honorable member who raised the point recognised and laid down in the first Commonwealth Income Tax Act the principle that shareholders who invested money in Australia for the development of Australia, but who lived in England, should not be taxed twice.
– We tax them twice in Australia. They have to pay the State and Federal income tax.
– That is another unfair form of taxation. I trust that this Bill is going some of the way to abolish even that.
– I do not think so.
– Unfortunately, in the limited time available to honorable members it is impossible to give the various clauses of this important measure that consideration which their subject demands. I am sorry that the committee stages of the Bill have to conclude by 6 o’clock, because we have had an hour’s very profitable discussion on the question referred to by the honorable member for Yarra, and we may safely assume that other points perhaps of equal importance will be raised in the course of the debate. I have not been able to get a copy of the second-reading speech made by the Treasurer, and I regret that in this abnormal legislative session I have not had an opportunity of speaking before upon some principles involved and some amendments proposed in this class of legislation. The provisions of section 20 open up a wide field for discussion. Clause 5 of the Bill is designed, I understand, to alter the incidence of the flat rate upon companies, and .to radically amend section 20, which provides that the flat rate upon companies shall only be imposed upon the undistributed profits. The proposed amendment is going some way, but a very little way, towards the taxation of in comes at their source. Since 1917 some of us have been urging the abolition of duplication in respect of Federal and State income taxation, but our voices were like that of one crying in the wilderness. This plank has been in the platform of the National party since 1917, but the present Treasurer is tie first who has tried to do something practical. There have been many official, as distinct from parliamentary, attempts to simplify the income taxation, and to abolish duplication. Conferences of Federal and State taxation representatives have been held, and the matter has been discussed at various Premiers’ Conferences, but with each amendment of the Income Tax Assessment Act we seemed to be getting further away from a realization of tour aim. The chief point of difference between the Commonwealth and the States is in regard to the taxation at the source of incomes derived from companies. I agree that mathematically and academically the Federal system of income tax assessment, carrying the graduation to three points of decimals, and to curves of the second and third degree, in the assessment of individuals, is absolutely accurate. But the States say, with some truth, that it is a very impracticable method of assessing income taxation, and that their method of taxing at the source, although not so scientifically accurate, raises just as much revenue, and enables the Department to be much more efficient.
– It is more equitable.
– It is less equitable, but more equitable as the graduations are nol extended to three points of decimals. I believe that, generally speaking, the State method is the more practicable and reasonable, and tends towards simplification of administration. For instance, in connexion with the Broken Hill Proprietary Company, which has, perhaps, 10,000 shareholders, the Federal method requires 10,000 individual assessments, each carried to three points of decimals, and debiting the taxpayers if their individual income rates are higher, and crediting them when they are less than the flat rate paid by the company. The amendment of section 20 prepares the way for the imposition of a flat rate of ls. in the £1 on companies’ profits instead of the rate of 2s. 5d. on undistributed profits. The Treasurer has stated that that tax of ls. will give an advantage to the taxpayers, inasmuch as on the average for six years 52 per cent. of the profits of the companies throughout Australia were distributed to the shareholders, and 48 per cent were undistributed, so that if the flat rate of1s. is paid on all profits of a company, whether distributed or undistributed, it will mean a slightly lower taxation than would the payment of 2s. 5d. in the £1 on the 48 per cent. of undistributed profits. New South Wales pays 40 per cent. of the taxation of the Commonwealth, and a table prepared for the State Government by Mr. A. Jobson, a wellknown financial authority in Sydney, showed that in respect of 253 companies in 1920, 305 in 1921, and 326 in 1922, the distributed profits were 67 per cent., 71 per cent., and 72 per cent., respectively, of the total profits. If those figures are correct, and I believe they are, this alteration of the incidence of company taxation will increase the impost upon companies in that State. Assuming that 70 per cent. of the profits of companies registered in New South Wales are distributed, the flat rate of1s. in the £1 upon all profits, in lieu of a rate of 2s. 5d. on the undistributed profits, will mean an increase of about 30 per cent. in the company tax in New South Wales. I believe that the methods proposed by the Treasurer, if I understand them aright, will modify, to some extent, the present duplication by State and Federal authorities. At any rate, they will relieve the much-harassed taxpayer of the duty of preparing more than one return, and that is a long step in the right direction. I have heard a lot of argument about the amour propre of the Commonwealth being affected by the proposal to surrender its rights of taxation, but the taxpayer does not differentiate between the Federal and State authorities in regard to taxation. It does not matter to him to which authority he pays his taxes; he is concerned only with the total amount he has to pay.
– I remind the honorable member that some of us sat all through last night with the guillotine hanging over our heads, and the honorable member is now making a second-reading speech in Committee and monopolizing the time that is required for the consideration of all the remaining clauses of the Bill.
– During this session my contributions to the debates have been few and brief. The question arises whether the arrangement proposed by the Commonwealth is constitutional. The Treasurer has not laid upon the table any copy of an agreement between the States and the Commonwealth.
– The agreement with New South Wales was laid on the table about a fortnight ago.
– But no agreement has yet been made with Victoria and the other States.
– An agreement with Victoria and Tasmania is practically assured.
– It is not yet un fait accompli. If the whole of the States do not subscribe to the same agreement as has been made with New South Wales, can the Federal authority collect income taxation in different forms in the several Slates?
– No differentiation in the tax will be involved.
– But the incidence of the administration of the tax will vary in different States. We hear taxation very glibly discussed, and one, listening to the Opposition, would think that it was the function of this Parliament to look about for means of raising more taxation instead of seeking a way by which it may be reduced. The total taxation - Federal and State - imposed in the various States upon incomes of £1,000 and £10,000 per annum respectively is approximately: - Victoria, 2s. and 9s. in the £1 ; Tasmania, 2s. 6d. and 9s. 6d. ; South Australia, 2s. 6d. and 10s. 6d.; New South Wales, 3s. and 11s.; Queensland, 3s. 3d. and 12s.; and Western Australia, 2s. 6d. and 13s. These rates are higher than those imposed on incomes in Great Britain. How can we expect to develop this country if we desire still further to increase them? Some honorable members are always crying for a little more juice out of the taxation lemon. Without having heard all about the Treasurer’s proposals, I may say that I approve of any step to simplify taxation and abolish duplication; and I certainly approve of any step that will reduce the big army of civil servants that we now have in our Taxation Departments, and will secure economy.
.- The explanation of the Treasurer has not satisfied me, and I shall, therefore, proceed with my amendment. I have no desire to impose double taxation on company shareholders, and I do not think the amendment will have that effect. My proposal is that if a shareholder in an Australian company, who lives in London, has an income of £20,000, of which £7,500 is derived from his Australian interests, he shall be taxed on that £7,500 at the Australian rate.
– But he pays again in London on that amount?
– I think not. I understand that there is an arrangement between the British and Australian Governments by which adjustments are made in such cases.
– There is an elimination of the lower tax.
– I understand that shareholders in Australian companies are assessed under the British income-tax legislation, but are given a rebate of the amount of fax they pay in Australia.
– Do they receive a rebate of the whole of the Australian tax?
– The agreement is rather bewildering, but I understand that the amount of rebate cannot exceed 6s. in the £1. As that is approximately our maximum rate, shareholders in England who derive income from Australian companies would, under my proposal, receive a rebate of practically the whole of the amount of Australian taxation imposed on them. I ask the Government to accept this amendment. The matter can be adjusted easily. I desire to see affirmed in the ‘principal Act the principle that persons abroad who derive incomes from the operations of companies in Australia, which have their head office in London, shall pay the full amount of taxation which would be assessed’ on their incomes if they lived in Australia. If we agree to this amendment, any necessary adjustments in the rates Act may be made later. I do not think a flat rate of ls. is equitable. Why should a person who receives only a small income from company operations be taxed ls. in the £1, while others who receive much larger incomes also pay only the same amount? I understand that a legal opinion has been given that no power is given in the principal Act to permit of a differential rate such as I am suggesting. I -wish to see the definite instruction given that differential rates shall be imposed on shareholders in Australian companies who live abroad.
The honorable member for Martin (Mr. Pratten), in speaking to the amendment, said it would oblige shareholders living in England to pay a double tax. He must remember that shareholders in Australia have to pay a double tax. They are required to contribute to both the Commonwealth and State revenues. We control only the Commonwealth taxation, and we should make it as equitable as possible. Why should taxation privileges be given to people who live abroad ? They should not be placed in a better position than shareholders who reside in Australia. We should attempt to induce them to come to Australia to live, but the Government proposal is rather an encouragement to them to remain abroad. When companies are operating in Australia, we should endeavour to get them to establish their head office in the Commonwealth.
– We are only talking about the shareholders at present.
– That is so, but if taxation on a company is less because its head office is in Australia, the shareholders will benefit accordingly. I think all the shareholders in a company, whether they reside in Great Britain, Australia, or any other country, should be placed on the same basis of taxation. Companies operating in Australia could escape some of the British taxation which is said to oppress them so heavily, if they had their registered office here. I do not think that the domicile abroad of a shareholder should relieve him of taxation- 1 am sorry there is not more time for us to* debate this amendment, but the guillotine is to be applied at 6.15 p.m., and between now and then we wish to move a number of other important amendments to this Bill. I think the honorable member for Martin (Mr. Pratten) will admit that insufficient time has been allowed for the consideration of this measure. I trust that the Treasurer will accept the amendment.
– The Government cannot see its way clear to accept this amendment. The proposal in the ‘Bill really increases the taxation on companies. The purpose of the amendment is to attempt to follow the individual shareholders wherever they may go. I do not see how that can be done. The rate that has been fixed by the Government is, as nearly as can be ascertained, the average rate of taxation on shareholders. The Taxation Department is of the opinion that shareholders will now have imposed upon them what will practically amount to a standard rate of taxation on the whole of the profits of the company. Even if the proposal of the honorable member for Yarra (Mr. Scullin) were practicable, the cost of collecting the tax he wishes to impose, would be very high.
Question - That the amendment (Mr. Scullin’s) be agreed to - put. The Committee divided.
Majority . . . . 11
Question so resolved in the negative.
Clause agreed to.
Clause 6 agreed to.
Clause 7 -
Section 23 of the principal Act, is amended -
by adding atthe end of paragraph
of sub-section (1) thereof the following proviso: - “Provided that no deduction shall be allowed of sums expended by the taxpayer for repairs to property coming withinthe provisions of paragraph (c) of section 16 of this Act; and
by omitting from paragraph (i) of that sub-section the words “base metals or rare minerals,” and inserting in their stead the words “ basemetals, rareminerals, or oil “.
.- I move -
That the word “ or,” in line 15, paragraph (b) be left out, and that the words “ or afforestation” be added to the paragraph.
Afforestation is of national importance. Throughout Australia the forests are being rapidly depleted, and little effort is made to restore them. Year after year, millions of feet of soft timbers for the manufacture of cases, &c., are imported into Australia. We have millions of acres of land at present of very little use, though suitable for the growth of the pinus insignis. If men are prepared to invest capital in ventures such as afforestation, that will not show a return for probably twenty or twentyfive years, they should be afforded every possible protection. The South Australian Government are carrying on a progressive afforestation policy, employing a large number of men all the year round. Land which was not worth 5s. or 10s. an acre is now worth £500 an acre owing to the growth of timber on it over a period of twenty -five years. Companies are being formed for afforestation purposes.
– How will those companies come under the Bill ?
– I am asking for the same exemption for them that is given to companies mining for base metals, rare minerals, or oils. Afforestation is an industry of equal national importance, and unless assistance is given to this industry, timber will be very scarce in Australia in thirty years’ time. I ask the Treasurer to accept the amendment.
– I have a prior amendment.
– The amendment of the
Leader of the Opposition can be moved only with the consent of the honorable member for Barker.
– Inthe circumstances, I am prepared to withdraw my amendment.
Amendment, by leave, withdrawn.
– I move-
That sub-clause (a) be omitted.
This sub-clause provides that no deduction shall be allowed of sums expended by the taxpayer for repairs to property. It is ridiculous to tax a man’s home, and, under this proposal for capitalizing the value at 4 per cent. instead of at 5 per cent. as formerly, to deny that man the right to deduct from his assessable income, moneys expended on repairs to his property. Under the Act this is allowed, but the Bill proposes to take away that right. The advantage of the difference of 1 per cent. is more than counteracted by the effect of sub-clause (a). I ask the Treasurer to accept the amendment.
– The alteration proposed in this Bill has been recommended by the Conference of taxation officials of the Commonwealth and States. The purpose is to secure uniformity in the assessment, and to prevent a considerable amount of misunderstanding arising out of the existing Federal provision, which has led to a great deal of correspondence. Under the existing Federal Act 5 per cent. of the capital value of the taxpayer’s residence has to be added to his income for taxation purposes, and he is allowed to deduct from his total income expenditure on repairs. This has led to endless correspondence and much discussion regarding the amounts charged for repairs. The Victorian Act is much simpler in this respect. It requires 4 per cent. of the capital value of the taxpayer’s residence to be added to his total income, which is 20 per cent. less than the amount which has to be added for this purpose under the Commonwealth Act. The difference is found, by experience, to cover the average amount deducted for repairs under the present Commonwealth Act. The amendment proposed by. the Leader of the Opposition would leave the matter as it stands at present.
– No, I do not propose to interfere with the 5 per cent.
– The position would be better than it will be under this Bill.
– The Government has an open mind in this matter, and is in the hands of the Committee. The purpose of the proposed amendment, as I have said, is to secure uniformity of assessments, and to facilitate work in the taxation office. I understand that the New South Wales Government is prepared to come into line with the legislation of Victoria in this respect.
.- I wish only to say that my amendment has nothing to do with the assessment at 5 per cent., but deals with quite another matter. Personally I have never been in favour of the imposition of taxation based on the capitalization of a man’s home. I regard that as a property tax. It is true that if the percentage is reduced from 5 to 4 that will mean that for a home, the capita] value of which is £1,000, £40 will be added to the taxable income, instead of £50 as under the existing Commonwealth Act. But that is not a justification for the proposed repeal of the existing right to deduct the cost of repairs. In the case of my own home the annual cost of repairs would not be covered by the proposed reduction of the percentage from 5 to 4. I hope the Treasurer will meet the Committee in this matter. Honorable members on this side are endeavouring to improve the Bill, and it is, in my opinion, unfair that people who have exercised thrift and provided a home for themselves should be penalized in the way proposed.
Amendment agreed to.
– I have given notice of an amendment of paragraph (e), sub-section 1 of section 23 of the principal Act, and I should like to know whether it should be submitted at this stage.
– I remind the honorable member that the Committee has already dealt with an amendment of the paragraph of the section to which he has referred. His proposed amendment of paragraph (e) would, therefore, not be in order. It will be necessary for him to submit it as a new clause later on.
Amendment(by Mr. M. Cameron) agreed to -
That after the word “ oil “ in paragraph (b) of clause 7, the words “ or in any company carrying on afforestation “ be inserted.
– I move -
That the following new paragraph be added to the clause : -
Notwithstanding anything contained in the principal Act or this Act there shall be deducted from the assessable income of a taxpayer for the financial year commencing on the 1st day of July, 1923, all sumspaid by the taxpayer during the financial year commencing on the 1st July, 1921, in calls on shares in any company or syndicate prospecting for oil in the Commonwealth.
-Is that not already provided for in the clause?
– No. In moving the amendment, I wish to say that the consolidating Act passed last year did not include shareholders in companies prospecting for oil in the same category as shareholders in companies mining for gold, silver, and so on. The Commonwealth, having offered a bounty of £50,000 to any one finding oil, a great impetus was given to prospecting for oil, and many people in a small way put money into companies formed for the purpose. Whilst taxpayers are allowed to deduct from their assessable income calls paid to gold mining companies, in the last financial year they were not permitted to deduct anything in respect of calls or shares in companies formed to prospect for oil. I remind the Committee that if these companies are successful, quite as much taxation will be derivable in the future from profits earned from oil as from profits earned from gold mining and similar industries.
Amendment agreed to.
.- Clause 7 deals with section 23 of the existing Act, and that section covers the deduction allowed for children. The present deduction permitted is £40 for each child. I propose to move that the allowance be increased from £40 to £60. On the last occasion when this matterwas under discussion, the Treasurer, who was then in opposition, said that he was very sorry that the Government had not increased the deduction allowed for children, because we should encourage people with families. In the circumstances, I ask the honorable gentleman to accept my amendment. The concessions made in the Bills which have been under our consideration during the last few days will benefit a particular section of the community; but the poorer people, who, generally speaking, have the largest families, have been given no concession by the amending legislation which has so far been proposed. In the case of a man with a family of six earning £5 per week, if the allowance for children were increased to £60, he would escape liability to pay income tax.
– Make the allowance £50.
– I have no objection to compromise and split the difference; but I should like to know what the Treasurer has to say on the matter. I move -
That the following new paragraph be added to the clause : -
By omitting from paragraph (k) the figures “ 40 “ and inserting in their stead the figures “ 50 “.
– The amendment to increase the exemption in respect of children under sixteen years to £50 involves a considerable sacrifice of revenue. So far as I am able to ascertain, the amount is between £60,000 and £70,000. In New South Wales, the exemption is £50, but in the other States it is notso high as that. As honorable members are aware, negotiations are taking place between the Commonwealth and the States with a view to securing uniformity in income tax legislation, and the desire is that the exemptions shall tally as closely as possible. This question of increasing the Commonwealth exemption to £50 has received the consideration of Cabinet, but finality has not been reached on the subject. However, the Government are prepared to accept the amendment.
Amendment agreed to.
– I move -
That the following new paragraph be added : -
by adding the following new paragraph : -
Dividends received from gold-mining companies and incomes of gold producers derived from gold production for a period of five years from 1st day of July, 1923.
The gold-mining industry for many years has been in a position entirely different from any other industry in the Commonwealth. The ex-Prime Minister (Mr. W, M. Hughes) during the war imposed an embargo upon the export of gold, which had to be sold in Australia at prewar prices, and owing to the higher cost of production the industry lost very heavily. One of our highest mining authorities, Mr. Dyason, has pointed out that for the four and a-half years during which the embargo was operative the gold producers of the Commonwealth lost between £2,000,000 and £3,000,000; and as Western Australia produces twothirds of the gold output, of Australia, the industry in that State lost £2,000,000. It is unnecessary for me, at this stage, to stress the parlous position of the industry. I may point out, however, that in 1913 the gold production of the Commonwealth totalled 2,207,000 fine ounces, and the persons employed in the industry numbered 33,000. In 1922 the production had fallen to 754,000 fine ounces, and the number of persons employed was only 11,000. During the war the United States Government took over the whole of the silver production of that country at $1 per ounce, which was below the world’s parity, and now, in order to stabilize the industry, have agreed to take 200,000,000 ounces of silver at $1 per ounce which is now above the current market price. I can assure the Prime Minister that I am not attempting to put before him this proposal at the request of the Gold Producers Association. But gold producers in Western Australia are naturally anxious that the Government should deal with this as an urgent matter. If the apple, sugar, and beef industries can be assisted by the Commonwealth Government, surely the gold-mining industry, which helped the Empire to win the war, is entitled to the same consideration !
– I am sure that all honorable members have every sympathy with those associated with gold-mining in Australia. We should have a real sense of gratitude to the industry for the service which it rendered to the Empire and Australia during the war. Gold is, of course, a most necessary commodity. It is also the standard of value. During the war, as the honorable member for Kalgoorlie (Mr. A. Green) has pointed out, there was an embargo upon its export from Australia. The gold-mining companies, by their efforts to increase production, did much to assist Australia and the Empire to carry on the war. I want to make it quite clear that, although I cannot see my way to accept the amendment, I have every sympathy with the industry, and I think it has a fair claim to consideration. The suggestion has been made on many occasions that the Commonwealth Government made a profit upon the Australian production of gold during the war period. The Commonwealth Government took no profit from the gold-mining industry during the war period.
– I did not make that suggestion.
– I admit that, and I think that everybody associated with the industry knows that there was mo foundation for the statement. Whilst the price of gold in Australia during the war was stabilized and did not vary, the cost of production increased considerably, and as a result the industry is now in an unfavorable position. This question of relief was raised when I was in Western Australia. A large deputation, accompanied by Mr. Gardiner, the Colonial Treasurer, waited upon me there, and another deputation, representative, I think, of all the interests concerned, saw me about a fortnight ago. I must say, in all fairness to them, that the case for the industry has been stated with the greatest moderation. The facts appear to be irrefutable. Various suggestions for the relief of the industry, including the proposal to exempt it from income taxation for a period of five years, have been considered, but the Government have come to the conclusion that this course would create a most dangerous precedent. Other industries which happened to fall upon troublous times would be able to refer to Government action in connexion with the goldmining industry as justification, for requests from them for similar assistance. There is also the fact that the concession asked for is based, not so much upon the present position of the industry as upon the services which it rendered to Australia and the Empire during the war period, which, is now some years behind. I suggest that, to exempt those engaged in gold-mining from the payment of income taxation for a period of five years is not the proper way to assist the industry. There are other methods. The honorable member mentioned the action taken by the Government of the “United States in acquiring the total silver production over a period, in order to stabilize the industry. ‘ That is a matter which would have to be carefully considered by this Government. We should have to determine whether it would be a satisfactory method of meeting the situation here. We have given careful consideration to this question on several occasions, and we are still considering it. There is no occasion to refer to what has been done by Parliament with regard to other industries. The position of the gold industry is hardly analogous to those mentioned by the honorable member. The Government came to the assistance of those industries because they were regarded as of national importance. If the Govern - ment came to the conclusion that the goldmining industry was vital to the interests of the whole of the people, its position then would be analogous to the industries mentioned. At the moment the position is being considered from that point of view. Certainly there was a curtailment of profits over a considerable period, when other industries were able to advance their charges as a result of the increased cost of living, and so make more substantial profits. I suggested to the earlier deputations that the representatives of the industry should endeavour to evolve a suggestion that would overcome the difficulty. I cannot accept that which has been offered by the honorable member for Kalgoorlie, because I consider it would establish a most dangerous precedent. The Government is still considering the requirements of the industry to see if some way out of the trouble can be found. It is prepared to give consideration to any suggestion that the industry itself cares to make, but I cannot accept this amendment for an exemption from income tax as a possible solution of the difficulty.
Clause, as amended, agreed to.
Clause 8 -
Section 27 of the principal Act is amended by omitting from sub-section 2 thereof the word “ Ten “ and inserting in its stead the words “Seven and one half”.
Section proposed to be amended - 27. - (1.) Every person whose principal place of business is out of Australia, and who either as owner or charterer nf any ship carries passengers, live stock, mails or goods shipped in Australia shall by his agent or other representative in Australia, when called upon by the Commissioner by notice published in the Gazette or by any other notice, make a return of the full amount payable to him (whether such amount be payable in or beyond Australia) in respect of the carriage of the passengers, live stock mails and goods (2.) The agent or other representative shall be assessed thereon and liable to pay- tam on Ten pounds per centum of the amount so payable.
.- I ask the Committee to delete this clause. Itis a repetition on a modest scale of the sort of thing we have been fighting during the past two or three days. It proposes that the taxation of foreign shipping companies shall be based on l per cent., instead of on 10 per cent, of the gross earnings in respect of freights and fares from Australia. The rate of taxation upon companies has already been reduced from 2s. 5d. to ls. I ask honorable members to realize what these two alterations will mean. At present on £100 worth of freight an overseas shipping company is taxed on a 10 per cent, basis, at the rate of 2s. 5d. in the £1, a total of £1 4s. 2d. The new rate of ls. in the £1, on a basis of 1 per cent, of the gross profits, will reduce the tax payable by the company to 7s. 6d. for every £100 of freight. That applies only to foreign shipping com: panics.
– Was the 10 per cent, basis fair?
– If honorable members will look at the balance-sheets of the foreign shipping companies they will realize that it was more than fair. Shareholders in Australian shipping companies* will have to pay income tax on the full profits. I have made a rough calculation that this Bill makes a direct gift to the foreign shipping companies of £100,000 per annum. That is why the Government is forcing through this measure with tha aid of the guillotine. If this clause is deleted the 10 per cent, basis will continue, but the companies will pay only at the rate of ls. in the £1. The proposal contained in the clause is an outrage.
– The law at present is that foreign companies trading to Australia are taxed on the basis of 10 per cent. of their gross earnings in freight and passage money. During the war that tax was reasonable, because the profits made by the shipping companies were considerable. On that basis, the companies paid at the rate of 2s. 5d. in the £1. The position to-day is very different. I have consulted with the manager of the Commonwealth Shipping Line, and I am informed that all the private companies, as well as the Commonwealth Shipping Line, are losing money. The Australian shipping companies are taxed only on their profits; if they make no profits they pay no tax, but the foreign companies are taxed on their earnings, whether or not they make any profits. The present tax is very oppressive. During the year, representatives of the beef industry approached the Commonwealth Government for a bounty, and the Government insisted that cheaper freights should be charged. The foreign shipping companies made representations regarding the high tax imposed, not on their profits, but on their total earnings. They asked for an alteration of the basis of assessment from 10 per cent. to 5 per cent. of the gross earnings, and a reduction of the rate of tax to1s. 6d. in the £1. TheGovernment decided to impose a uniform tax on companies of1s. in the £1, and to assess the taxable income of the overseas companies on the basis of7½ per cent. of the total freights and passage money. I have gone closely into this question, and I regard the amendment as absolutely fair. The only effect of the present high rates of taxation is to keep up the freights on the primary produce carried overseas.
.- This is another exhibition of the antiAustralia policy of the Government, which, apparently, has gone out of its way to find means of assisting privileged sections of the community. Now it is proposed to grant to foreign companies a substantial measure of relief from taxation. The Government looks . after the ships manned with black labour, and the tonnage owned by the Inchcape Combine and the rest of that crowd who depend on coloured and sweated labour. The workers who are endeavouring to live on the basic wage get absolutely no consideration from the Government.
When the Leader of the Opposition (Mr. Charlton) moved that the allowance in respect of each child should be increased to £60, this allegedly Australian Government refused to agree to it. But foreign shipping companies, whose profits upon goods carried from Australia are enjoyed by people outside the Commonwealth, can get what they want. The Government is reducing their taxation by 68 per cent., but there is no consideration for the Australian people who bear and rear children. The rearing of children is practically confined to one class; if the maintenance of our population depended upon the birth rate amongst the wealthy, the race would die out.
– The time allotted for the consideration of this stage of the Bill has expired.
Question - That the clause be agreed to - put. The Committee divided.
Majority … … 4
Question so resolved in the affirmative.
Clause agreed to.
Question - That the remainder of the Bill be agreed to, and the Bill reported with amendments - put. The Committee divided.
Majority … … 10
Question so resolved in the affirmative.
Bill reported with amendments; report adopted.
Motion (by Dr. Earle Page) proposed -
That the Bill be now read a third time.
.- I move -
That the Bill be recommitted for the purpose of amending clause 8 so that the provision for the reduction of taxation provided therein shall apply only to (hose shipping companies which observe Australian conditions.
In the few moments at my disposal when I moved for the deletion from the Bill of clause 8, I pointed out that it would have the effect of reducing the taxation on foreign shipping companies by 68 per cent., and that the amount involved was over £100,000. If this remission of taxation is to be granted, it should be only to companies which comply with Australian conditions.
– I do not think we can consider this amendment.
– I draw attention to the fact that the time has arrived for taking the vote on the third reading of this Bill.
– The vote on the third reading of the Bill is to be taken at 6.15 o’clock. It is not yet that time.
– A reason why this amendment cannot be accepted is that the Commonwealth Government Line of Steamers alone of those that trade to Australia from abroad observes Australian conditions. If the amendment were includedin the Bill there would be no shipping companies to which it could apply.
– The time allotted for the consideration of the Bill has now expired.
Question - That the amendment (Mr. Scullin’s) be agreed to - put. The House divided.
Majority … … 11
Question so resolved in the negative.
Bill read a third time.
Bill returned from the Senate, with amendments.
Sitting suspended from 6.2fr to 8 p.m.
– I move -
That the Bill ‘be now read a second time.
Honorable members are aware of the action which the Commonwealth Government took in conjunction with the Imperial authorities concerning the acquisition of wool and the introduction of war precautions necessary to give effect to the acquisition and control of the sale and purchase of wool during the period nf the war, and for some time following that great event. This Bill arises out of certain contracts which- were made in circumstances due to the war. It proposes the validation of contracts made, as the Bill says, “ during the late war, relating to the manufacture of wool tops, or the purchase or sale of wool for the manufacture of wool tops.” It has been introduced in consequence of certain doubts that have arisen as to the validity of the contracts in the absence of express legislative authority to enter into them. There are altogether five contracts dealt with. Two were entered into between the Commonwealth and Whiddon Brothers Limited, the first dated March, 1917. and the second 7th December, 1918. There was a further contract made between the Commonwealth and the Yarra Falls Spinning Company Proprietary Limited, dated 24th December, 1918. Another was made between the Commonwealth and the Lincoln Spinning Mills Proprietary Limited, dated 2nd October, 1919. There -is a fifth contract, dated 12th March, 1920, between the Commonwealth and the Colonial Combing, Spinning, and Weaving Company Limited, of Sydney. The two contracts with Whiddon Brothers were on different terms as regards remuneration. In the case of the first of .these contracts, made in 1917, the wool purchased for the purpose of manufacture was at appraised prices, and adjusted to flat rates. The remuneration of the company was to be on the basis of fifty-fifty if war-time profits tax had not been introduced, and if it was operating then, on the basis of one-third to the company, and two-thirds to the Commonwealth Government. Under the other contract the wool was to be paid for at appraised prices, adjusted to flat rates; but there was one particular clause in the agreement under which the company was to pay such additional sum for the wool purchased during any wool season as should be decided by the Central Wool Committee to be equal to the percentage amount of the dividend payable by the Wool Committee to the growers of wool in respect of profits, if any, resulting from sales by the Imperial Government of wool derived from the wool clip from which the wool purchased was derived. That amounted to an increase of nearly 20 per cent, above appraised prices, the proceeds of which were credited to the Wool Pool. The Commonwealth Government received as licence fees, or war-time profit tax, or income tax, the balance, excluding State income tax. The remuneration under the second contract of Whiddon Brothers was based upon a commission. They were manufacturing and selling as agents for the Commonwealth, and they were to be paid 4id. per lb. of tops combed for the first 1,000,000 lbs., 4d. for the second 1,000,000 lbs., and 3$d. for the third and fourth 1,000,000 lbs.. Under that contract, they were supplied with wool at agreed on prices; they manufactured as agents of the Commonwealth; and were to be paid a certain commission, whilst the profits resulting were to be paid to the Commonwealth. The contracts with the Yarra Falls and Lincoln Companies were on similar terms, and based on the same principle of an agency business and payment of commission. There is another contract dealt with in the Bill, which was made with the Colonial Combing, Spinning and Weaving Company Limited. It was based on a different principle. The division was to be 80 per cent, to the Commonwealth Government and 20 per cent, to the company. I do not wish to go further into the details.
– Will the Minister say whether in the case of the Colonial Combing, Spinning and Weaving Company the contract was ever legally agreed to.
– It was signed and executed by the Right Honorable William
Morris Hughes, Prime Minister, on behalf of the Commonwealth in the presence of Sir Robert Garran, and it was signed on behalf of the company by William Hughes, John Christian Watson, and Roderick McLean, directors of the company. These contracts were made in all good faith, freely and voluntarily, by all the parties concerned. Whiddon Brothers entered into the first contract freely and voluntarily, and later voluntarily undertook the second contract. In the case of the Yarra Fall’s and Lincoln Mills companies, they had been carrying on” operations, and in co-operation with the Central Wool Committee they extended their plant for the purpose of increasing their output, and engaging in this business on the terms of their contracts. Therefore, as regards the equities, no possible question can arise. The parties entered into the contracts freely of their own motion, and having done so, they continued to operate under them for some considerable time, as regards three of the companies practically up to 1920. They received the remuneration they had agreed to receive, and undoubtedly they made fair profits out of their contracts. They handed over to the Commonwealth Government, and it received from them, approximately, £600,000. No question of duress or hardship of any description was raised by the companies, but recently a letter has been received by the Commonwealth Government from Whiddon Brothers, in the following terms: -
I am instructed by my board of directors to address you with reference to certain payments made by this company under what purported to be agreements dated Srd April, 1917, and 7th December, 1918, respectively, between the Commonwealth of Australia and Whiddon BrO’thers Limited.
We have been advised that we are entitled to recover the whole of the moneys so paid, and/or retained, and now enclose statement showing how the sum of £324,331 9s. 5d. which we claim is arrived at.
In the light of recent decisions of the High Court of Australia, we assume that the Government of the Commonwealth will admit the company’s claim (subject to the accuracy of the figure supplied).
Wc shall be glad to have your assent to this, and to know as early as convenient when the amount is likely to be available.
Whiddon Brothers is the only company that has made a claim, but if similar claims are made by the other companies referred to, and on the same basis, the total amount claimed would be about £600,000. The point is that they cannot arid do not set up any claim in equity that they have any right to participate in that amount on merit or by virtue of any contract, or because of any disadvantage they suffered. The contracts they entered into provided for certain remuneration, which remuneration has been, and will be, given. The object of the legislation proposed is to 1 validate the agreements I have referred to, which the company says, because of a recent decision of the High Court, are invalid. The High Court did hold that certain agreements were invalid. ‘ Judgment has been come to upon those particular contracts, and the rights of the parties . have been determined in the course of litigation by the Court. The Government are accepting that decision, and exempting those cases from the operation of this Bill. The ground of the. High Court decision was practically that the Executive of the day had no authority, either under the Constitution or under then existing legislation to enter into these contracts.
– Not even under the War Precautions Act?
– No. Whiddon Brothers are claiming on the technicality that there was not legislative sanction for the contracts, and they are, therefore, entitled to get out of them, and make their claim on the Commonwealth. I submit to honorable members that in the circumstances they will agree that there is absolutely no justification for the claim, and the Commonwealth Government is perfectly justified in keeping the parties to the terms of the contracts, which were fairly and openly made.
– Did the Government receive £600,000?
– And it is holding on to that money?
– Yes. It was paid in accordance with the remuneration to which the companies agreed.
– The contracts were fully carried out by the Commonwealth?
– Yes. All that the Government is asking under this Bill is that legislative ratification shall be given to these contracts, the validity of which has been questioned^ because legislative authority was not obtained before they were entered into.
– This means that the Government are trying to prevent certain persons from getting money out of the Commonwealth illegitimately.
– We propose to prevent them from being able to say that they are not bound by the contract and are entitled to more than they contracted for.
– - Has any action been taken in the Courts in regard to the agreement ?
– No. So far only one claim has been made upon the Commonwealth. As regards the Colonial Combing, - Spinning, and Weaving Company, a claim has been made by the Commonwealth. Nothing has been paid over. The contention is that the company have made no profits, and that they are governed by the decision of the High Court in the previous case.’ The question of profits is a matter for accountancy. Whatever is due the Commonwealth ought to get. Counsel have advised, in consequence of the doubts that have been raised, that the Commonwealth should validate the contracts by passing this legislation. I may add, in closing, that the Central Wool Committee strongly recommend the Government to resist in every way possible the payment of such profit, which would mean, in practice, that these companies were able to secure raw wool in Australia at appraised prices - the lowest in the world - and sell wooltops in the open markets at the world’s quotations during war time. All other woollen manufacturers were subject to the control of the Central Wool Committee during the war period, and were restrained from selling woollen goods overseas except based on the world’s prices for raw wool. If Whiddon Brothers Limited or other wool-top companies selling tops for export overseas were allowed such profits as they are now claiming, they would secure terms much more advantageous than were permitted any other wool organization in the British Empire. Upon these grounds I ask the House to assist me in placing this measure upon the statute-book of the Commonwealth.
Debate (on motion by Mr. Charlton) adjourned.
In Committee (Consideration of. Go vernor-General’s message) :
Motion (by Dr. Earle Page) agreed to-
That it is expedient that an appropriation of revenue be made for the purposes of a Bill for an Act relating to the collection of income tax and for other purposes.
Resolution reported; Standing Orders suspended, and resolution adopted.
That Dr. Earle Page and Mr. Groom do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented, and (on motion by Dr.
Earle Page) read a first time.
– I move -
That the Bill be now read a second time.
The purpose of the measure is twofold. In the first place it is to authorize the Government to enter into agreements with the States for the collection, by State officers, of’ Commonwealth income taxation due by persons in the various States whose income is earned in a particular State, and in the second place, it is to authorize the payment of compensation to officers of the Commonwealth Taxation Department who may be retired in consequence of retrenchment. It is well known, as the honorable member for Martin (Mr. Pratten) said this afternoon, that for the past six years there have been continual complaints concerning the duplication of work imposed on taxpayers in the preparation of returns of income. There have been complaints also of the unnecessary maintenance of separate staffs for twice doing work which should be done only once. The Commonwealth Government, as a result -of negotiations with the’ States, have at last been able to ameliorate the position by arranging with the States for the collection by State officers, of Commonwealth income taxation earned within their boundaries. In the Budget speech, this subject was discussed at some length. It is scarcely necessary to recapitulate now the reasons then adduced. I should like to state that in any arrangements that have been made or that are in . contemplation, there will be no abrogation in the slightest degree of the taxation powers of the Commonwealth Parliament. The State staffs will simply collect the Commonwealth tax under the supervision of the Federal Commissioner of Taxation, and will pay the proceeds from day to day into the Commonwealth Treasury. Already an agreement has been arrived at with the State of New South Wales, and that document has been laid on the table of this House. At present the Government are in negotiation with the Governments of the other States, and yesterday afternoon, I was fortunate enough to finalize the agreement with Sir William McPherson, ou practically all points, with regard to the State of Victoria, and it is hoped that within the next day or two, South Australia, for which State Sir William Mcpherson is acting, will come into line. In connexion with Queensland, a fairly close rapprochement has been possible with the Premier (Mr. Theodore), and we hope that the uniform returns will be sent, out in that State by the 30th September. Copies of all the agreements will be laid upon the table of the House.
– Will all the agreements be the same?
– Unfortunately, we cannot get complete uniformity. The agreements with New South Wales and “Victoria are substantially the same in most particulars, and with regard to the other States we are making the best possible terms.
– It will be a bit of a mixture.
– It is much better to arrive at an agreement in this’ way than to endeavour to secure the passage of a uniform taxation Act for the whole of Australia by its thirteen houses of Parliament, which would be the only other way in which uniformity could be secured.
– I am afraid the scheme will prove unworkable.
– ‘The collection of the Commonwealth tax by State officers will necessitate an increase in State staffs, but this increase will not absorb the whole of the Commonwealth staff at present engaged in the various States. It is impossible to say immediately the exact number that will be retrenched in the near future, but it will be very considerable, and the saving to the Commonwealth, it is expected, will be in the vicinity of £260,000.
– I thought the Minister on a former occasion, stated the amount at £400,000.
– That amount would have been saved if the original proposals of the Commonwealth had been accepted by the States.. We intend to continue the negotiations in the hope of being able to bring about uniformity, for it must be borne in mind that any saving effected in this direction will be a direct relief to the taxpayers, who are the same whether under Federal or State jurisdiction.
– I am afraid that what we would save by retrenching the Commonwealth Departments, will be counterbalanced by the added cost of the State Departments.
– It is anticipated that there will be a saving in the number of employees engaged. Ail examination of the New South Wales agreement which has been laid on the table of the House, will show that the permanent and probationary employees of the respective Taxation Departments will be added together, and that whatever retrenchment may be necessary will be borne in proportion to the number of officers engaged in both services. Similar terms are being arranged with Victoria and South Australia.
– What will be the term of the agreement?
– Five years.
– If the agreement is for five years, how can a different arrangement be possible, as the Minister indicates, next year?
– This arrangement is purely for the purpose of collecting Commonwealth taxation for next year. Ti the Commonwealth determine to evacuate a certain field of taxation, that will not make any .difference to the terms of the agreement which are sufficiently wide to enable that to be done.
– All the terms of the agreement will fit into either arrangement.
– Yes. If next year it is determined that the Commonwealth only shall tax companies, or shall tax only incomes above £2,000 per annum, this Parliament will alter its own Act; but the arrangement with regard to the cost of collection, which is to be borne by the respective Governments in proportion to the amount of work entailed, will not ‘be affected by such action by this Parliament. The two matters are quite .distinct. The agreement for the collection of the tax has a currency of five years, and any action that may be taken by Parliament to amend the Assessment Act will not invalidate “the agreement. There has been a certain amount of confusion in the public mind in regard to this matter, and I am glad that the question asked by the honorable member for Martin (Mr. Pratten) has enabled me to make the position clear. There are two distinct and independent issues, which do not conflict in any way. The saving in the cost of administration will continue, and, I hope, will increase, but, during this year, and, possibly next year, it will be necessary tlo provide a certain amount of money for the compensation of officers who have to be retrenched.’ The Government has tried to approach the retirement of these permanent officers with the utmost sympathy, consistent with its duty to the public at large. The Bill includes provisions relating to their compensation. Generally speaking, the compensation will be on the same scale as that provided for defence officers last year. We have been able to profit by experience, and we have tried to make a provision for compensation which will be as generous, as possible to the retrenched servants, whilst at the same time conserving the public interests. The basis is a month’s pay for each year of service, with a minimum of six months’ pay. For this purpose pay will be deemed to include salary, basic wage allowance, cost of living allowance, and such other allowances as- may be approved by the GovernorGeneral in Council. In order to retain in the service as many as possible of the taxation officers, provision is being made in the Bill to pay compensation to any officer in any branch of the Public Service who voluntarily retires, and whose position the Public Service Board may fill by an officer of the Taxation Department.
– Is that for the purpose of retaining the smartest men ?
– The arrangement will have that advantage. Very many capable men entered the Taxation Department believing that it was a permanent field of employment, and the Govern ment is anxious tlo retain the services of such officers, who undoubtedly will be a great asset to the Public Service in time to come. Another provision of the Bill aiming at the retention of taxation officers is that when the Public Service Board is of opinion that any officer of the Taxation Branch is more deserving than any officer employed in any other Department or branch of the Commonwealth Public Service, the taxation officer may be retained, and the services of the other officer dispensed with. Of course, compensation will be payable to the officer retired. It is intended that the time during which any retired officer was on war service shall be included in the period for which compensation is provided by the Bill. Where an officer, prior to permanent appointment, was employed temporarily, the temporary service will count. That point was raised the other day in connexion with superannuation and its benefits, and in regard to this compensation the rights of the officers are stated beyond any possibility of doubt. There are a good many returned soldiers who through negligence failed to put themselves in a permanent position, although they had passed the prescribed examination. Under the Bill they will be entitled to compensation in respect of the period subsequent to the date of the passing of the examination or the commencement of temporary service, whichever is the later. Ex-soldiers in some cases have had their appointments to the Public Service ante-dated to the time of enlistment. If any such are retired in accordance with the Bill their compensation will be calculated as from the ante-date. Following the action taken on 30th June, 1922, when compensation intended to be paid to Defence officers on their retirement was charged in the Treasury accounts to the expenditure of the year then closing, the sum of £200,000, now estimated to be required for compensating Taxation and other officers, was transferred to a trust account in the Treasury on 30th June, 1923. I have had no previous opportunity of replying to the criticism directed to that portion of my Budget speech. I submit that it is wise and prudent when such a change is contemplated to make provision, not out of estimated receipts which may never be realized, but out of an actual surplus which the Treasurer has in hand. I believe that is a com- !plete answer to the whole of the critijcism directed against this transaction. I This Bill appropriates out of the Consolidated Revenue such amounts as may be necessary to pay compensation in accordance with its other provisions.
Debate (on motion by Mr. Charlton) adjourned.
In Committee (Consideration resumed from 26th July, vide page 1703) :
Clause 3 -
Section 5 of the principal Act is amended by , omitting therefrom the word “ three,” and inserting in its stead the word “ four “.
– A number of questions having been. raised during the previous discussion of this Bill, the Government, after further consideration of the measure, has decided to limit the amendments of the principal Act to (1) the increase of the members of the Board from three to four, as provided for in clause 3, and (2) to extend the duration of the Board by one year instead of five, as proposed in the Bill. This amendment will give hon- .orable members a further opportunity next session of going fully into the whole question. I shall therefore propose later that clauses 5, 7 and 8 be deleted, and that clause 9 be amended by inserting the word “ three “ instead of “ seven,” thus extending the life of the Board by one year.
– The Minister has given the Committee no information as to why the Government desires to appoint an additional member to the Board.
– I explained the reasons in my speech on the second reading. In my opinion, the principal reason for strengthening the Board is that it is very busy, and has to inquire very closely into many details, and I believe that if it comprised four members instead of three it would be unnecessary for it to work unreasonable hours.
– Who will be the fourth member?
– I do not know. The appointment will be made by me with the sanction of Cabinet. When Mr. Herbert Brookes went on leave recently, I had great difficulty in ‘finding a suitable man to fill his position. He had to be a man of high repute, experienced in business, and not personally interested in any active business. A man with those qualifications is hard to find. Eventually I selected Mr. John Vicars, and I think honorable members will agree that I made a very good appointment.
– Hear, hear ! A very good man.
– He is a good Nationalist.
– I do not “ think any honorable member will say that Mr. Vickars is a partisan.
– We know that he is.
– In such a position we must have a man who will act absolutely fairly.
– He will look after the interests of the big shipping companies fairly.
– I suppose he subscribed to the £25,000.
– I do “not know anything about that. I am not concerned about the £25,000. I did not get any of it. We need a man who will look after the interests of the country. I think that’ all honorable members in this Chamber know that Mr. Vickars is a man of high character and great business experience. He will deal fairly and squarely with all matters that come before him. I do not care what a man’s politics are so long as he is not a pronounced .partisan and will regard the interests of the country.
.- The Minister says that he wants to put in this position a man who will consider the interests of .Australia. I say, deliberately, that I believe the reason for proposing to increase the number of members on the Tariff Board, is that a representative of the Country party may be appointed. From time to time in this Chamber during the last year or so, members of the Country party have urged that they should have representation on the Board. When any proposal is made to give the industrial workers representation on such a Board, the Country party representatives vote solidly against it. They do not think that Labour should have representation on these Boards, but they want it for themselves. Only recently, honorable members on this side of the House urged very strongly that a representative of the maritime workers should be appointed to the Shipping Board, but the members of the Country party would not hear of it. Our sole reason for seeking such representation was to assist in the smooth working of the Commonwealth Government Line of Steamers. This cannot be considered an urgent matter. The Government seems to lose sight of the fact that as honorable members have been sitting in this Chamber continuously since 11 o’clock yesterday morning, save for a brief interval, it is a fair thing that they should be asked to deal only with urgent business. The Tariff Board will continue for twelve months more unless we renew it, and surely this matter could be allowed to remain in abeyance until the whole question is before us next session. It seems that every matter which involves giving sops to certain sections of the community is considered urgent by this composite Government. It was most urgent yesterday that we should rush through a Bill which presented £1,300,000 to the big pastoral interests of the country.
– But they had to drop the loot.
– The measure before us earlier in this sitting also aimed at giving special consideration to certain classes of the people. The fact is that the members of the Country party realize that they must treat some of these questions as urgent to justify themselves in the eyes of the people who sent them here. Unless they take actions of this kind they are doomed. Meetings are being held all over the Commonwealth which indicate that they are in disfavour even with their own supporters. The Country party can no longer be regarded as a separate political entity. Only two parties exist in this House - the Nationalist party and the Labour party. The so-called Country party has ceased to function.
– But the honorable member for Hunter is claiming that it is functioning in this very matter.
– Actions such as this are taken only to save ‘its face. The Government cannot reasonably ask honorable members to agree to this clause and leave the appointment with the Cabinet. We should have much more information than has been given to us. Some honorable members say that the Tariff Board has done no good, and statements have appeared in the press from time to time criticising it and charging it with having interfered with the Tariff. I do not agree with those statements. I believe that the’ Board has rendered good service to the country. If some alterations are necessary to give Parliament more control of it they should be before us, but no necessity whatever exists to appoint another member. These members cannot go separately to different places and decide matters. The business with which they have to deal must be settled in consultation, and chiefly in consequence of representations made to them as a body. I have had some dealings with Mr. Vicars, and, in justice to him, I think that I should say that he is a very good man for the position he occupies. On all occasions on which I have approached him he has endeavoured to do his best for the country. I believe that he and the other members of the Board are striving to give effect to the intention of the legislation which they have to administer. They are well able to cope with their work. The only complaint that I have heard respecting them is that they are doing too much. If some honorable member who had time would’ sit down and total up the cost to the country of the legislation we have passed within the last fortnight he would get a very interesting result. It seems to me that lately we have been doing nothing but spending the taxpayers’ money. There is no call for us to spend still more in appointing another member to the Tariff Board. Such an appointment would not lead to any expedition in the business of the Board. It is strange that such an appointment is advocated by honorable members opposite who are so much concerned about keeping down the expenses of the country, and who talk so much about reducing our heavy national debt. I suppose that the salary of another member of the Tariff Board would be about £1,200 or £1,500 a year. We may be told that a thousand or two is nothing, and judging by the way in which we have been giving away millions one would be entitled to believe that statement. . The trouble is that all these odd thousands mount up. The members of the Tariff Board are well able to do all the work that is required of them. Their duty is to report to the Minister on various Tariff matters: that is what they are doing. Let them keep on doing it, and let us resist this attempt to incur additional unnecessary expenditure. Honorable members opposite complained about the large expenditure involved in the Estimates, but a day or two after the Estimates are out of the way they are anxious to still further increase the expenditure. I know that the honorable member for Swan (Mr. Gregory) holds views on the Tariff different from mine. He is at all times a staunch Free Trader, and he has some support in this House.
– It is growing.
– That is one of the curiosities of the age.
– I will say for the honorable member for Swan that one always knows where he stands. He can be depended upon all the time.
– No matter how foolish his ideas may be.
– I wish that I could say as much for his colleagues. Some of them will vote for Protection on all occasions except when the interests-1 of the men on the land are concerned.
– Or when explosives are needed for miners.
– The. honorable member for Gippsland (Mr. Paterson) evidently does not realize that it was absolutely necessary for me to adopt the attitude I did on that matter. If he had known the facts, he would not have allowed the honorable, member for Forrest (Mr. Prowse) to prompt him.
– I was not prompted.
– Well, I inform the honorable member for Gippsland that my action in regard to explosives was taken for the protection of human life. He will always find me trying to protect life.
– I commend the honorable member’s action.
– I am glad of that. The matters which I had in mind when the honorable member interjected were quite different from mining explosives. A. duty on dried fruit would be acceptable to the honorable member, but it is quite another matter with machinery. The
Minister has acted wisely in deleting a number of clauses from the Bill, and in limiting the operation of the Board to one year. We shall thus have proper opportunity for debate next session. The honorable member for Swan (Mr. Gregory) foreshadowed an amendment, and I should like to know whether he intends to proceed with it.
– No. We shall have plenty of time next year to fully consider the whole subject.
– I oppose the appointment of an additional member to the Tariff Board. No reason has been given for it, and we should refuse to incur this additional expenditure at a time when strict economy should be exercised to reduce the national debt.
– I agree with the remarks of my leader. The Minister might very well explain the necessity for appointing an extra member to the Tariff Board. Has the work increased to such an extent that the present Board cannot deal with it?
– That is one of the reasons.
– Then the Board should go out of existence. It has encroached upon the prerogative of Parliament by interfering with Tariff duties.
– It cannot do that.
– What are the functions of the Board? Before being asked to support this measure we should have information of the volume and nature of its duties. Do the members admit that they are incapable of dealing with the increased volume of work? Persistent rumours are afloat that the honorable member for Swan is to be appointed to this position at a salary of £2,500 a year. This would suit the honorable member, because when the House adjourns he would have this fat job in his pocket, with no chance of the Labour party forcing him to drop the loot.
– On a point of order. The honorable member for Dalley (Mr. Mahony) has insinuated that I am to be appointed to the Tariff Board, and has also made use of an offensive remark concerning the “ dropping of the loot.” There is no truth whatever in the statement that I have been offered the position, and I ask that the offensive statement be withdrawn.
– I did not intend to say anything offensive to the honorable member, but I am out to arrive at the truth. If the honorable member for Swan says that .he knows nothing of the appointment, I am prepared to accept his word. Does the Minister (Mr. Austin Chapman) know anything about it? Has some intermediary approached him concerning the appointment of a member of the Country party to smash the Protectionist incidence of the Tariff ?
– I should not take the position if it were offered to me.
– I assure the honorable member for Dalley that it is not intended to offer the position to the honorable member for Swan.
– At least, I have gained the assurance that the honorable member for Swan will not be appointed. The honorable member for Forrest (Mr. Prowse) said that a Protectionist policy would ruin Australia. He advocated Free Trade for everything except onions and potatoes, and for those commodities he thought protection should be provided. Is the position to be offered to the honorable member for Forrest? The Minister should inform the Committee who is to be appointed. It is very pertinent that I should ask whether the Temporary Chairman (Mr. Cook) has been offered this position ?
The TEMPORARY CHAIRMAN.I ask the honorable member to confine his remarks to the clause.
– It is possible that this new position may be offered to the honorable member for Riverina (Mr. Killen), or the Government Whip (Mr. Marr), who has lately taken a wonderful interest in Australian industries. Will the Minister say whether this position is to be given to the honorable member for Parkes. The honorable member would not be a bad man for the job. If the Minister will not say who is going to be given the appointment, I might be permitted to offer him a few suggestions. There is quite a number of honorable members on this side who would be very suitable for the position. What better fighter have we in this Parliament than the honorable member for Melbourne Ports (Mr. Mathews) ? In season and out. of season the honorable member has fought strenuously for Australian indus tries, and what better type of man could be appointed to- a Board of this kind ?
– If I could get the honorable member’s equal I would be satisfied.
– Why not give the honorable member, himself, the job? The Minister is not prepared to offer the position to the honorable member for Melbourne Ports because he does not belong to the right political party. If he belonged to the Free Trade brigade in the corner, who support a ProtectionistMinister for Trade and Customs, he would no doubt get the appointment. The big squatters and the beef barons have been given some of the loot, and possibly some honorable members of the Country party would also like to have a share in the spoils. This Parliament is pledged to the policy of Protection, and I ask whether it is to have that policy flouted and circumvented by the appointment of a rabid Free Trader as fourth member of the Tariff Board. I enter my protest against the measure, because the Minister is not prepared to say who is to be appointed to this position, what the salary is to be, and what are the functions of the Board.
.- The honorable member for Dalley (Mr. Mahony) asked whether any members of the Tariff Board had complained of the work they were called upon to do. Quite recently the Board presented its annual report. Although the honorable member for Dalley discussed the Board freely, he does not know what the Board is doing, nor has he taken the trouble to read its report. Still he thinks himself a fit and proper person to air his ignorance of the subject in this Chamber. If honorable members will turn to page 24 of ths Tariff Board’s report they will find the following statement there : -
With reference to itself, the Board desires to say that the work it has been called upon to do has been exceptionally heavy and requires the closest application. The Board has taken a keen interest in some of the serious problems which have confronted Australia as an aftermath of the war conditions, and has willingly spent much time, private as well as public, on the metal, hop, carbide, sulphur and other industries.
The members of the Board have spent their own time, as good public servants, in the work of the country, and although they have been overworked they are pre- pared to carry on their job. The Board further reports -
The work tends to increase and cannot be coped with in the usual official hours.
Honorable members opposite always claim that no man should be asked to do more than a fair day’s work. One of the members of the Tariff Board is going to England as a member of the staff of the Prime Minister, and he will be away from Australia for some months. Although there is work to be done which cannot be accomplished by three men except by working overtime, for which they are given no recompense, honorable members on the other side tell a tale in this matter which is very different from the tale which they tell outside when they are asking for votes on the hustings. They wish, in this case, to sweat the members of the Tariff Board by refusing them the assistance they require. An extra member is required on the Board, particularly during the absence of the chairman. I have no doubt that when I resume my seat some honorable members opposite will get up and put a few new clothes on the same old skeleton.
– Drop the loot.
-Honorable members opposite have got that phrase into their heads, and they mouth it over and over again like so many parrots. One of them will shortly come to the table, but will give the Committee no new ideas. I ask honorable members opposite whether they are prepared to go outside and admit that they have deliberately attempted to sweat a Board of deserving public servants by refusing them the assistance they urgently require.
.- I hoped when the honorable member for Richmond (Mr.R.Green) rose that he would announce his intention to do the job which the Minister for Trade and Customs (Mr. Austin Chapman) evaded, and would give the Committee some information. All that he said was that honorable members on this side have one idea which they mouth like parrots, but the honorable member had not an idea to mouth. If he is in want of ideas he has only to come over to this side. He will find dozens of speeches always prepared, and, incidentally, I may say they are not prepared for us, because we are able to prepare them ourselves. Can the Minister explain the secrecy that is sur rounding this particular appointment? If what the Government propose to do is fair there should be nothing to hide. If it has decided to loot the Treasury to the extent of £1,400, it has also no doubt decided who is to get that particular “ cut.” Is the Government afraid to make an announcement on the subject before Parliament rises? The Temporary Chairman is a member of the Country party that has been submerged or swallowed, and I ask whether he can give any information as to who is to get this job, and how much he is to be paid.
– That is a matter that does not concern the Chair.
– The Minister has refused to give information, and the honorable member for Richmond attempted to give information and failed because he had none to give. He was as barren and dry as a barrel in Bourke in December. The honorable member had handed to him the report of the Tariff Board, and dutifully read it out, but gave no reason for the proposed appointment. I suggest that when the Minister has a tale to tell he should see his supporters, tell them what he proposes to say, and ask them not to say something different. This is only a small looting expedition, ifI may be permitted to use that term. It is for a job worth £1,400 a year, including expenses, which, of course, the people of the Commonwealth will be expected to pay. We have seen lately how scientifically and secretly the Treasury may be looted of large sums of money. I have in mind the Government proposal to give away £200,000 for the purchase of cheap wire netting for their farmer friends, but the honorable member for Fawkner (Mr. Maxwell) turned on the light, and tripped up the little expedition. Thanks bo the exposure by the Labour party, this grant for wire netting will now be distributed through bonâ fide channels. TheMinister has told us that there is safety in numbers, hence the decision of the Government to appoint a fourth member to the Tariff Board. If there be safety in numbers, why not increase the members of the Board to twelve ? But I am reluctant to accept the Minister’s assurance, and I am convinced that this is merely another little scheme for looting. Yesterday the Government attempted an expedition for £1,300,000 in the interests of the big pastoralists, but the Labour party threw a piece of iron into the machinery, and something went wrong. That expedition was tripped. The original looting proposal had to do with the disposal of the Commonwealth Woollen Mill at Geelong, in the interests of the rag merchants of Yorkstreet and Flinders-lane. These people had to be placated. Competition by the Commonwealth Mill had to be removed, and accordingly a property worth somewhere in the vicinity of £400,000 was disposed of, chiefly to Flinders-lane interests, for £155,000. Since that deal prices for woollen cloth have gone up. There is evidence that the Inchcape Combine, together with certain other shipping organizations, which we cannot yet link up with the Inchcape combination, have their tentacles upon this Government.
(Mr. Cook). - The honorable member must confine himself to the clause under discussion.
– I was endeavouring tlo do so, Mr. Chairman. These several looting or pirating expeditions are so related one to the other that I think my remarks are relevant. Shipping interests, employing almost wholly black labour, got a present of £100,000 from this Government to-day. But I do not wish to proceed further in that matter. No doubt you have your own feelings as well as honorable members on this side of the Chamber, and I do not ‘wish to hurt them. This Bill is only one of a series of expeditions. I have no doubt that there are other persons in the background, party backers, and wire-pullers who are hoping, perhaps in company with the Minister for Trade and Customs, the PostmasterGeneral, or the Prime Minister, to make a little trip into the Treasury, to get, for services rendered, their quid “pro quo. We on this side of the House intend to reiterate our allegations in regard to these expeditions. We intend to tell the people of Australia where all this money is going, and by what channels it reaches its destination.
– I was wondering, when the honorable member for Richmond (Mr. R. Green) was speaking, what interest he had in this subject, for it was clear that he spoke very feelingly. The honorable member for Dalley (Mr. Mahony) mentioned quite a number of people who have been spoken of as likely to receive the appointment. One who is mentioned more than any other is the gentleman who was so narrowly defeated by the present honorable member for Richmond. No doubt the possibility of getting rid of a dangerous rival was a good and sufficient reason, in the opinion of the honorable member for Richmond, why a fourth man should be appointed to the Board. In the hope of arresting any misgivings that might be disturbing him, I now ask the Minister in charge of the Bill this simple question - “ Is it the intention of the Government to appoint this dangerous rival to the honorable member for Richmond?”
– The time for asking questions has passed.
– I am sorry I cannot give the honorable member for Richmond the assurance which I hoped to be able to give. If the gentleman referred to does not receive the appointment, I. am afraid we shall shortly miss the honorable member for Richmond. The Minister is not treating the House fairly in this matter. He would not give us an assurance that -the honorable member for Swan (Mr. Prowse) was not going to get the job, nor would he say that you, Mr. Cook, were not a candidate; but when your name was mentioned I noticed that you blushed very deeply.
– I ask the honorable member not to make personal allusions to the Chair.
– I accept your statement that you are not a candidate for the position. No honorable member in the Corner except one, who has a personal interest in the matter, has asked for an assurance regarding the fiscal complexion of the man to be appointed to this Board. Have those honorable members already received an assurance that the appointee will be a rabid Free Trader ? The only inference to be drawn from the silence of the Country party is that honorable members have been assured that a Protectionist will not be appointed.
– What a vivid imagination the honorable member has.
– That is our only means of eliciting information. ‘ The honorable member for Swan was a good friend to the last Government; he was a reliable bridge-builder, and was always ready to help the Government out of a difficulty. Ishould not be surprised if he received this proposed appointment as a reward for past services. It is of vital importance to the industries of the country that this Committee should know whether the appointee will be a Protectionist or a Free Trader, and what salary will be paid.
– The principal Act specifies the salary.
– Would the Minister be acting fairly if he appointed a Free Trader, such as the honorable member for Swan or the honorable member for Perth (Mr. Mann), to the Tariff Board ? Nobody can say that the members of the Board are overworked, and I have not heard that they have complained on that score. The Government has some object in appointing a fourth member, and we have a grave suspicion that it is plotting to undermine the Tariff and the Protectionist policy of this country. Composed of two parties that cannot agree on fiscal matters, the Government cannot possibly carry on unless it gives sops all round - to the Protectionists to-day, and to the Free Traders to-morrow. The last appointee was a Protectionist, and in order that the fusion may live, and honorable members in the corner be appeased, the next person to be appointed will probably be a Free Trader.
Question - That the clause be agreed to - put. The Committee divided.
Majority … … 12
Question so resolved in the affirmative.
Clause agreed to.
Clause 4 agreed to.
Clause 5 negatived.
Clause 6 -
Section 12 of the principal Act is amended by omitting from sub-section 3 thereof the word “ deliberate,” and inserting in its stead the word “deliberative”.
.- This Bill increases the number of members of the Tariff Board to four. Under these circumstances will the Chairman have a deliberative and casting vote?
– He will have both.
– That means that the Chairman and another member of the Board can decide all matters that come before the Board. I am much afraid that the so-called Country party has nominated for the extra seat on the Board a man who has been accepted by the Government, and one whose political fiscal views are not in accord with the policy of this country. If that is so, it constitutes another scandal that thisGovernment has perpetrated.
Clause agreed to.
Clauses 7 and 8 negatived.
Clause 9 -
Section 37 of the principal Act is amended by omitting therefrom theword “ two,” and inserting in its stead the word “seven”.
– I move -
That the clause be amended by striking out “seven,” and inserting “three.”
The amendment means that the Tariff Board will have a life of one more year instead of five more.
Amendment agreed to.
Clause, as amended, agreed to.
Title agreed to.
Bill reported with amendments; report adopted.
Bill read a third time.
Order of the Day discharged; Bill withdrawn.
Message recommending appropriation reported.
In Committee(Consideration of Governor-General’s message) :
Motion (by Mr. Bruce) agreed to -
That it is expedient that an appropriation of revenue be made for the purposes of a Bill foran Act to provide for the payment of an annuity to the widow of the late Honorable Frank Gwynne Tudor.
Standing Orders suspended, and resolution adopted.
That Mr. Bruce and Dr. Earle Page do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Bruce, and read a first time.
– I move-
That the Bill be now read a second time.
This Bill provides for the payment of an annuity, at the rate of £156 per annum, to the widow of the late Honorable Frank Gwynne Tudor. Mrs. Tudor, owing to unfortunate circumstances over which she personally had no control whatever, has been left without funds with which to1 sustain herself, and is practically in a condition of destitution. The services rendered to the Commonwealth of Australia by the late Mr. Tudor are well known to all honorable members of this House. His memory is revered by every one of us who had the privilege of knowing him during his long career in the public life of this country. He was elected to membership of the Commonwealth Parliament at the inception of Federation, and he retained his seat until the day of his death. During that time he was a minister of the Crown in four administrations. At the time of his death he was the Leader of the Opposition. Few men in Australia’s history have given up their lives from a stronger sense of public duty than did Mr. Tudor. I am sure that all honorable members will feel that it would be most lamentable if his widow, through circumstances over which she personally had no control, should be placed in the position of having to work to obtain the bare necessaries of life. This Bill is to prevent that, and I think it will commend itself to all honorable members. Mr. Tudor certainly died in the service of his country, and those who remember the circumstances will appreciate that it was an almost unparalleled sense of duty, and a determination to carry through his part at whatever cost to himself that brought about his untimely and early death. The basis upon which this pension has been determined is that set out in the Australian Soldiers Repatriation Act. The proposed annuity is equivalent to the amount that would be payable to the widow of an officer who was receiving the maximum pay provided for in the First Schedule. It is appropriate that that should be the basis on which a pension should be provided for the widow of Mr. Tudor, because no soldier sacrificed his life from a greater sense of duty to his country than did Mr. Tudor. I have much pleasure in placing this measure before honorable members.
– I very much appreciate the action of the right honorable the Prime Minister and his Government in introducing this Bill. I associate myself with the remarks made concerning my late leader. It is well known that Mr. Tudor devoted himself conscientiously and ably to his public duties - so much so as to cause his untimely death. Mrs. Tudor, through no fault of her own, is in poor circumstances, and consequently the Government have decided to assist her. Some provision should be made by honorable members to prevent these cases from occurring. It is unfortunate that many men, who have for years given their best to the country, as did the late Mr. Tudor from the inception of Federation, should, at death, leave their families without sufficient means of support. On behalf of Mrs. Tudor, I again thank the Government for their kindly action.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Motion (by Mr. Bruce) agreed to -
That the House, at its rising, adjourn until 11 o’clock a.m. to-morrow.
Motion (by Mr. Bruce) proposed -
That the House do now adjourn.
.- Yesterday a deputation of the female postal employees waited upon me, and I introduced them to the PostmasterGeneral. He received them very cordially, and promised to see whether anything could be done for them. To-day a further deputation waited upon me, and pointed out that they were placed in a very awkward position, inasmuch as they belonged to the General Division, and while certain allowances were made during war-time, and since, to compensate for the increased cost of living in other Departments, they had been merged into the salary and become permanent. These female postal employees are in a different position. T. should perhaps put their case better by reading their own statement -
During war-time period cost of living allowances were granted as under: - Women, £27 a year; single men, £42 a year; married men, £62, plus child endowment, £13. Mr. Atlee Hunt recently gave an award to mechanics and postal sorters, increasing the allowance of single men from £42 to £62 a year, an increase of £20. Ata conference of representatives of the Public Service Board Commissioner and associations last week it was agreed to accept Mr. Hunt’s ruling to increase the allowance of all single men by £20, the same increase being granted to women clerks, women telegraphists, and postmistresses; the cost of living allowance of all women members of the General Division to remain at only £27. If this proposal be accepted, messengers after attaining the age of twenty-one years would receive asa minimumsalary £194 per annum, as against the maximum salary of £198 for a woman assistant, highly qualified and doing responsible work. We would point out our cost of living is as great, or greater, than that of a single man, and the absurdity of estimating the cost of living for one woman at £62 and for another, far more poorly paid, at £27 a year. The injustice is too apparent to require further comment, especially as if these allowances are merged into salary, it will destroy the principle of equal pay for equal work, which was embodied in thefirst FederalPublic Service Act.
This Parliament is about to be prorogued, and unless the Minister can see his way clear to grant these increases to these employees, they will be compelled to approach the Court for an award. Such applications occasion considerable cost, and after an award is made it must be laid on the table of the House for a certain period before it becomes operative. If this Parliament is prorogued for six or eight months, these employees may be unable to receive their extra pay until the House is again in session. Honorable members will admit the awkward position in which these women are placed.
– It is an injustice.
– One of them told me that it cost her 35s. a week for board, and, in addition, she had to provide travelling expenses, clothing and other necessaries to keep her in the state of respectability required by her occupation. It is only fair that these employees should receive a benefit extended to others. In the event of these female employees obtaining an award, the increase might be made retrospective, but I was informed to-day that it could not be done. A great injustice is likely to be inflicted upon the women workers of the Postal Department. If necessary the Bill should be amended. This case is of sufficient importance to justify the moving of the adjournment of the House, but I did not desire to obstruct the business of Parliament, and I thought this an opportune time to place the particulars before honorable members. I ask the Government to give this case favorable consideration.
– I have to-day received from Sydney a telegram which I shall read for the benefit of the Treasurer. It says -
To-day’s paper reports Nelson having said that Vestey’s had deliberately defied the Mini stry, and refused to pay land tax. We have neither defied Ministry nor refused pay; therefore statement absolutely incorrect. Competent any member get information my statement by asking question House. Authorize you use this. Further innuendo that Federal Commissioner of Taxation takes refusals to pay lying down appears to be most improper reflection that public servant. Doubtless Treasurer already protected him.
– That effusion is characteristic of the person who inspired it. The instigator is Mr. Conacher, who is the sole representative of Lord Vestey in Australia, and who recently published an article in the Herald. The object of the telegram is to try to intimidate and to discredit me. In spite of what the big vested interests have to say, the Secretary of the Smallholders Association regularly wires congratulating me on the work I do for his members. I am perfectly satisfied that so long as I protect the interests of the smaller men, I shall be justified in my actions in this House.
– The Northern Territory has a good representative in the honorable member.
– I consider it to be always my duty to expose the methods of large firms like Vesteys. Notwithstanding their £20,000,000 capital, the Northern Territory would be far better without them. They monopolize the whole of that country. The honorable the Minister for Home and Territories once informed a- deputation that the future of the Northern Territory depended absolutely on Vesteys. - It had reached the stage when they practically controlled the Northern Territory. Cencerning the telegram that has been read, I note with a certain amount of pleasure that the honorable member for Bass, who has been through the Territory, and. knows something of the condition of Vesteys’ runs, and of the way in which they slave their men-
– I know nothing of the conditions under which they slave their men. I do not admit that they do.
– The honorable member knows the conditions under which they house their men. Notwithstanding the fact that he poses as a champion of the Northern Territory on this occasion, he did not support the wire he received from Sydney concerning my remarks. It was not I, but I believe the Treasurer, who made, the statement referred to in the wire that since 1917 the big squatters had refused to pay their taxes, and that the Bill provided for a retrospective remission of taxation. Vesteys’ name, amongst others, was mentioned. In speaking, I drew attention to that fact, and asked why was the discrimination made, seeing that when I and others refused to pay taxes because of .a fundamental principle, we were sent to gaol without the option of a fine. Yet Vestey Brothers and others were allowed to remain free, and, in addition, legislation was introduced to remit to them sums that they owed to the Crown. I make no apology whatever for anything I said about Vesteys. ] ‘#,
– I have taken a note of what the honorable member for Bass (Mr. Jackson) has said. I am having inquiries made, to-day, regarding the statement the honorable member is alleged to have made. I did not, of course, say that any one had refused to pay his tax. What I said was that there had been a suspension order by the Treasurer of the day, and that resumption of collection had’ not taken place since. You will remember, Mr. Speaker, that the various attempts I made to secure a hearing last night were not very successful, but I have no desire to resume now where I left off then. I shall take the matters referred to into consideration.
– As honorable members are tired, I shall be very brief. But as Parliament will rise for an indefinite period within the next few days it is necessary that I should avail myself of this opportunity again to ask the Government to apply the provisions of section. 8 of the Customs Tariff (Industries Preservation) Act to the Australian marble industry. The quarries of the ‘ Ulam Carrara Marble Syndicate, the Ulam White Marble Company Limited,, and the Paris Creek Marble Quarries Limited, of South Australia, are closed down because the companies find that they cannot compete with importations of Italian marble. Following the depreciation of Italian currency, the Australian firms complain that the protection offered them is quite inadequate, and they ask for the application of the Industries Preservation Act to their industry. A representative of the Central Queensland quarries came to Melbourne five months ago and waited on the Tariff Board in connexion with thi3 matter. I am sorry that no definite decision has yet been given by the Board. I heard it said that at the end of last year the Board considered that the protection afforded by the Tariff is adequate, but letters received by the Ulam Carrara Marble Syndicate from business firms show that it is not sufficient. I quote a few words from these letters in proof of my contention. From Messrs. Train and Company, South Melbourne -
Owing to the big drop in the price of the imported marble we find the demand for the local marble falling off.
From Messrs. C. Heath and Sons, 159 Dorcas-street, South Melbourne -
The price of Italian sawn slabs is far cheaper than what you are charging in block form.
Our Mr. Parkinson has returned from bis six months’ trip throughout New Zealand, and found everybody loaded to the full with Carrara marble, which has been dumped on them at cheap prices, and Odlings with a bond full of marble which he has had thrown on bis hands, and is quitting at cut-throat prices..
If there is something which we have not heard from the Department to show why the Industries Preservation Act should not be applied to this industry,’ the Government should make it known. Whether there are some secret treaties with Italy in existence ‘ affecting the matter I do not know; but the House should be given all the facts. The marble industry in an important one and gives employment to hundreds of men in Australia. It should receive the protection it deserves. In 1914-15, Australia imported marble to the value of £46,000; and in 1921, to the value of £66,000. I have been unable to obtain figures showing the quantity imported, but I have no doubt that double or three times the quantity of Italian marble is now being imported, as compared with the imports prior to the war. I again appeal to the Minister for Trade and Customs (Mr. Austin Chapman), who is an ardent Protectionist, to take ‘this question up, if necessary, with the Cabinet, and come to a decision in favour of applying section 8 of the Customs Tariff (Industries Preservation) Act to Italian marble, because the Australian industry is at present practically dead for want of adequate protection?
.- I wish to .indorse the remarks of the honorable member for Capricornia (Mr. Forde). I have received through Mr. L. Hunkin, M.P., a request, similar to that made to the honorable member, on behalf of the marble industry in South Australia. 1 hope the Minister for Trade and Customs will see his way to give an adequate measure of protection to this very valuable industry, and will not allow it to be placed at a disadvantage through ‘importations’ of Italian marble. I trust that the Minister will give the matter his immediate attention, because it is very urgent.
– I wish to associate myself with the matter referred to by the Leader of the Opposition (Mr. Charlton). I have received a communication on the subject from the women folk in the South Australian service. We know that a contented service is a useful service. I should like to point out that we have passed a measure recently providing for’ a reduction of 50 per cent, in the postal rate, and of 100 per cent, in the weight of postal matter to be carried for the rate, for the benefit of the commercial community. It was pointed out when the Postal Bates Bill was under consideration that, if such a reduction in postal rates could be made, those employed in the Department, whose work has made that possible, should be adequately recompensed for their services. The claims of the women’ folk may be overlooked, because there is not the same cohesion amongst them as amongst men in the service, but they are banded together, and desire to be placed in the same position as male workers. The policy of honorable members on this side is equal pay for equal work, and I hope this policy will be given effect, notwithstanding the difficulties that may be in the way. When I approached the PostmasterGeneral in connexion with the matter, he referred me to the Public Service Board. The honorable gentleman is edged round with a lot of red-tape, and he should use the scissors and cut it. He should do the Billy Hughes’ stunt, and should not mind the Department. He should take up the mammoth role of the Little Giant, and see that justice is done to these women.
– I should like to know whether anythinghas yet been done towards making appointments to the Shipping Board, and whether the Prime Minister is in a position to make known its personnel! The delay in the appointment of the Board is causing a good deal of confusion and bother in tho administration of the Commonwealth Shipping Line and of affairs at the Cockatoo Island Dockyard. Certain important works are held up pending the appointment of the Board.
– I regret that I am not in a position to make an announcement with regard to the Shipping Board. I desire to do so at the earliest possible moment, because I agree with the honorable member that the position with regard to both the Dockyard and the Commonwealth Shipping Line must be one of uncertainty until the Board is appointed and functioning. The delay is due solely to the desire to secure for the Commonwealth Shipping Line the best possible Board, and , to afford it every opportunity to prove a success. I hope to be able to reach finality in connexion with the matter in the very near future, and to be able then to make an announcement on the subject. In connexion with the matter raised by the Leader of the Opposition and supported by the honorable member for Adelaide, I should like to inform the honorable member for Adelaide (Mr. Yates) that it is not the Government that determines the pay and positions of the ladies referred to, but the Public Service Arbitrator. The question turns on the circumstances arising, should there be a reference to the Arbitrator when Parliament is. not sitting, These matters, in the first place, go through the Attorney-General’s Department. I will consult with the Attorney-General, and give honorable members an answer in the matter to-morrow.
Question resolved in the affirmative.
House adjourned at 10.48 p.m.
Cite as: Australia, House of Representatives, Debates, 22 August 1923, viewed 22 October 2017, <http://historichansard.net/hofreps/1923/19230822_reps_9_105/>.